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*International Arbitration

Published on September 7th, 2017 | by Aspasia Archontaki


CJEU-Preliminary Question Referred : Compatibility of CETA with the European Treaties

On  27  October  2016,  the  Kingdom  of  Belgium  reached an  internal  agreement between  the  Federal  Government  and  the  governments of  the  federated  entities concerned regarding  the signing of the EU-Canada Comprehensive Economic and Trade Agreement (CETA).
This  agreement  contains  a  national  unilateral  declaration  regarding  the  Belgian conditions  for  signing  CETA,  for  which  the  undertaking  was  made  to  request  an opinion  from  the  Court  of  Justice  of  the  European  Union  (CJEU)  regarding  the compatibility of certain aspects of CETA with the European Treaties, in particular with regards to Opinion 2/15.
On 16 May 2017, the CJEU published its Opinion 2/15 regarding the EU-Singapore free  trade  agreement.  Opinion  2/15  states  that  the EU  does  not  have  exclusive competence  with  regards  to  hearing  disputes  between investors  and  States.
Furthermore, the CJEU confirmed that Opinion 2/15 only pertains to the question of competence,  and  not  the  question  of  the  compatibility  of  a  system  of  hearing disputes between investors and States with the European Treaties.

In  light  of  this,  the  Kingdom  of  Belgium  is  requesting  an  opinion  from  the  CJEU regarding the compatibility of Chapter 8 (“Investments”), Section F (“Resolution of investment  disputes  between  investors  and  states”) with  the  European  Treaties, including basic rights. This concerns a new, reformed system of hearing disputes between investors and States, the so-called Investment Court System (ICS), which will consist of a Tribunal and an Appeals Body.

Specifically, the Kingdom of Belgium is requesting the CJEU to provide an opinion regarding the compatibility of the ICS with:
1)The  exclusive  competence  of  the  CJEU  to  provide  the definitive interpretation of European Union law
2)The general principle of equality and the ‘practical effect’ requirement of European Union law
3)The right of access to the courts
4)The right to an independent and impartial judiciary

Regarding  the  right  to  an  independent  and  impartial  judiciary,  the  Kingdom  of Belgium wishes to obtain an opinion regarding the following aspects:
-the conditions regarding the remuneration of the members of the Tribunal and the Appeals Body.
-the appointment of members of the Tribunal and the Appeals Body.
-the release of members of the Tribunal and the Appeals Body.
-the  guidelines  of  the International  Bar  Association regarding  conflicts  of interest in international arbitration and the introduction of a code of conduct for the members of the Tribunal and the Appeals Body.
-the  external  professional  activities  related  to  investment  disputes  of members of the Tribunal and the Appeals Body.
With its request for an opinion, the Kingdom of Belgium hopes to further clarify the legal  framework  in  which  CETA  has  been  established, in  accordance  with  the
agreements  which  pertain  to  the  signing  of  CETA  by Belgium.  The  Kingdom  of Belgium does not take any position itself regarding the questions which have been put to the CJEU.
The  Kingdom  of  Belgium  is  conscious  of  the  fact  that  certain  aspects  of  the elaboration of CETA, and in particular the ICS, still need to be decided on by the Council  of  the  European  Union  on  the  basis  of  a  proposal  by  the  European Commission. This further elaboration may influence the regulatory framework for which the CJEU is requested to advise in this opinion request.
The Kingdom of Belgium is also conscious of the fact that the ICS is the first step towards the creation of a multilateral Investment Court which, in the long run, shall ecome the responsible legal institution to resolve conflicts between investors and states.
The provisions in CETA which are the subject of the Belgian opinion request to the  CJEU  are  excluded  from  the  provisional  implementation  of  the  Treaty.  The provisions  in  question  shall  only  enter  into  force when  all  Member  States  have ratified CETA in accordance with their national constitutional procedures.

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