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EPHA Position on Investment Protection in TTIP and Trade Agreements: Response to the European Commission proposal for an Investment Court System to replace Investor-to-State Dispute Settlement (ISDS)

 EPHA welcomes the European Commission’s decision to move away from the proposed Investor-to-State Dispute (ISDS) mechanism proposed in the Trans-Atlantic Trade and Investment Partnership (TTIP). This recognises concerns raised by civil society and the public that private ISDS arbitration is prone to conflict of interests, lacks transparency and could compromise sovereign governments’ right to regulate and provoke ‘regulatory chill’.

It is clear that the new Investment Court System (ICS) proposal of the European Commission has not been drafted for TTIP but rather in the context of future Trade and Investment agreements with non-OECD emerging economies, notably China.

In the context of international trade agreements between partners with mature and stable democracies and Court systems, notably TTIP, an Investment Court System or ISDS clause is not necessary. The public health community expects safeguards to ensure the EU and national governments are guaranteed the right in law and in practice to make policies and laws to protect and improve health. The mature and stable legal and political structures in the EU and US offer entirely adequate assurances to investors and are the only means of ensuring the continued sovereign right to regulate.

How to strike the balance between Protecting Health and Protecting Investments in TTIP and other Trade agreements

1. Defining and implementing policy and legislation to protect and improve public health must remain the sovereign right of domestic governments and take primacy over trade objectives. This right must not be compromised in practice by trade agreements.

2. Any form of Investor-to-State Dispute Settlement (ISDS) or parallel Investment Court System (ICS) is not necessary between trading blocs with stable democracies, mature established Court systems and legislature. The ICS proposal does not address fundamental flaws of ISDS. The ISDS/ICS Chapter should be removed from the EU-US TTIP negotiations.

3. In future trade and investment agreements with emerging economies, negotiators should insist that investors be required to exhaust domestic remedies before proceeding to use investment protection. For these agreements, ISDS should be replaced by a formally constituted and internationally-recognised International Trade Tribunal.

4. Investment protection regimes cannot seek to guarantee a ‘stable business environment’. There can be no ‘legitimate expectation’ that the regulatory environment will not change. Governments at all levels must be able to respond with policy and law to protect citizens’ health. Any claim questioning public interest legislation should be considered as inadmissible.

Download the full paper here

For further questions, please contact:

Zoltan MASSAY-KOSUBEK, Policy Coordinator for Healthy Trade and Health Equity
+32 2233 3872

Further reading:

Press Release: European Commission TTIP proposal for an Investors’ arbitration court dismissed as ISDS2.0
Video – The impact of TTIP for Health in Europe


In this video, EPHA policy coordinator Zoltan Massay-Kosubek addresses the impact of TTIP for health in Europe, covering five key areas: health services (1), healthcare systems (2), the inclusion of ISDS and its effect on healthcare (3), the cost of medicines (4) as well as the regulation on professional’s standards and qualifications (5).

Watch the video and get answers to the following questions:

– Are TTIP and other free-trade agreements a threat to our health services?
– If Healthcare services are to included in the trade deal, how will this effect the average?
– How would the inclusion of ISDS affect the healthcare and public health of Europe?
– Will the governments be able to regulate professional standards and qualifications for health care workers in the same way they do now?
– Will TTIP have an effect on the cost of medicines?

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