Debate: Future of EU international investment policy
Date: WEDNESDAY, 22 JUNE 2022
Speaker: Olivér Várhelyi
Language: EN

Today’s debate comes at a moment where investments more than ever are crucial for the EU’s recovery. Foreign direct investment also plays a key role in achieving our open strategic autonomy and our access to essential inputs such as energy. The EU remains the first outward investor in the world and a major destination for foreign direct investments. The EU offers a very attractive and open market to foreign investments, and through our investment facilitation, liberalisation and protection agreements we ensure that EU companies also operate on a level playing field in third countries. EU investors, more than any other foreign investors, decisively contribute to the sustainable development of the host countries, notably in the EU neighbourhood and Africa.  I would like to thank the rapporteur, Ms Anna Cavazzini, and the shadow rapporteurs for this draft resolution. As you acknowledged, the EU investment policy has significantly adapted and expanded to address concerns faced by EU investors and to take into account EU policy priorities. Our investment policy is also adapting to new political realities and challenges, but the draft resolution is mainly forward—looking. In particular, the draft resolution encourages the Commission to continue negotiating investment liberalisation commitments to ensure the best possible market access conditions for prospective and existing EU investors. The draft resolution also supports the negotiations on investment facilitation for development in the World Trade Organisation so as to help developing countries attract and retain investment. The Commission is playing a proactive role in those negotiations.  On investment protection, the EU fundamentally reformed its approach to ensure the highest standards of legitimacy, transparency and balance in its treaty practice. That reform covered both the investment protection standards and the dispute settlement mechanisms. The draft resolution welcomes the EU’s reformed approach on investment protection, but also calls for further adjustments to address new challenges, in particular climate change. This includes considerations on the sectoral coverage of our agreements, on the role of stakeholders beyond investors, or on how to calculate compensations for the EU.  Investment policy is constantly evolving to match the EU’s policy priorities. The Commission considers that EU—level investment agreements are fully compatible with the Green Deal and the green transition. Notably, our investment agreements include commitments on sustainable development taken by both parties, for instance on matters such as responsible business conduct and the respect of environmental, human rights and labour standards. They are also explicit about the right of governments to pursue legitimate public policy objectives, including the fight against climate change.  Finally, the draft resolution also points to the existence of unreformed bilateral investment treaties by Member States. Those agreements contain certain incompatibilities with EU law and inconsistencies with the EU investment policy. The Commission supports the renegotiation efforts by these Member States. As long as those treaties are not renegotiated or replaced by EU—level agreements, they will remain in place. In that respect, Parliament has done its part in terms of ratification of the CETA and Singapore and Vietnam Investment Protection Agreements, but we also need parliaments of the Member States to do their part of the work.  Again, it is important to highlight that the EU’s reformed approach on investment protection is largely the outcome of a strong call from the European Parliament. This is what led the Commission to propose the more balanced and transparent investment court system, but also to calibrate the standards of investment protection so as to avoid the unwanted impact of the interpretation of EU Agreements. The Commission takes note of the recommendations for further actions and will carefully examine each of them.  Honourable Members, it remains necessary to negotiate and implement disciplines on international investments. EU investors face difficulties when investing abroad, and investment is necessary to reach the Sustainable Development Goals, as well as for the EU’s open strategic autonomy. EU investment agreements do not confer more rights to foreign investors than what is granted under domestic law. The scope of protection in EU agreements corresponds to the minimum treatment afforded to any company in the EU under the rule of law.  Finally, the Commission thanks you for your support to our reformed approach and to the evolution of the EU investment policy. It is clear that the EU’s investment policy is not static and needs to take into account citizens concerns and priorities.