European Court of Justice backs legality of CETA’s Investment Court System

 George Thurley, Alternate public health member of the European Commission Expert Group on EU Trade Agreements

On the 30th April, the European Court of Justice (ECJ) ruled that the EU’s Investment Court System (ICS), as included in the EU trade deal with Canada (CETA), is compatible with EU law.

Belgium had asked the court to give its opinion following its ratification of the deal, as requested by Wallonia, whose parliament was concerned about the possible effects of CETA. Belgium expressed doubts as to whether the ICS system, which envisages the creation of a Tribunal and Appellate Tribunal, is compatible with EU primary law.

The ECJ ruled that ICS represents no adverse effect on the autonomy of the EU legal order, but that the tribunals it establishes cannot have the power to interpret or apply EU law beyond CETA, and also found the safeguards to ensure the independence of the Members of the envisaged tribunals sufficient.

Many trade campaigners see ICS as a reboot of the controversial Investor-state dispute settlement (ISDS), and therefore a considerable threat to environmental, labour protections and public health regulations, which could be targeted by businesses considering them irritants to trade. While this ruling is therefore a disappointment in some quarters, it simply re-emphasises the need for EU civil society to continue engaging with EU trade policy to ensure it supports, rather than undermines, the public interest.

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