12 October 2017

Multilateral Investment Court: Commission suggests counter-claims by states may be possible

Statement by DG Trade official reveals internal debate on controversial new court

Simon McKeagney, Editor

Speaking at a presentation on the Multilateral Investment Court (MIC) today in the International Trade Committee of the European Parliament, Colin Brown, Deputy Head of Unit in DG TRADE suggested that the proposed multilateral court would be able to hear counter-claims by states against the actions of foreign investors.

The suggestion is the first sign that the Commission is considering how to include obligations for international investors within the framework of the MIC, beyond the rights afforded to them in current mechanisms such as ISDS or ICS. 

Answering requests by MEPs, including Green MEP Heidi Hautala, to better explain how investor duties can be included in the new system, the Commission official said:

“To the extent [of] any agreements, and a number of agreements are starting to do this, cover investor obligations or allow counter-claims… to the extent where this is provided under the treaties, this Multilateral Investment Court would be able to hear claims that are brought in respect to the actions of investors.”

“If a treaty foresees that a counter claim can be made by the state alleging that the investor has acted incorrectly, then the Multilateral Investment Court could cover those claims” 

According to sources, the demand to include a framework that allows counter-claims is being pushed by a number of Member States as part of the Council discussion on the final negotiation mandate for the Commission. 

The question remains, could real investor obligations form a genuine part of the MIC proposal? The Commission hopes that moving to a multilateral system under the auspices of the UN will give legitimacy to investor rights. Currently such legitimacy is lacking. Making a concerted effort to enshrine investor obligations may be the only viable route forward.

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