Mr. David O'Sullivan:

The two things are parallel. When the European Commission was faced with difficulties about the ISDS in the context of TTIP - the Deputy will remember that there was a huge amount of concern and anxiety about it - it launched a widespread consultation and reached the conclusion that the European Union should seek to replace the current system of ad hocarbitration with a multilateral investment court.

At the same time, we were negotiating with Canada. The Canadians were highly sympathetic to our concerns. In fact, Canada is our greatest ally in trying to reform the system of ISDS. As there was not yet a multilateral court, the best we could do with Canada was to agree a kind of bilateral version of a multilateral investment court. That is basically what CETA does. It is a kind of stepping stone.

My personal view, respectfully, is that it is important to demonstrate to the rest of the world, which we are trying to persuade to come on board for this multilateral investment court, that we can have a functioning model in CETA to show how such a system might work and be improved relative to ad hocarbitration.

The investor-state dispute settlement system does not replace the national legal system. It is always possible for companies, governments and civil society to go through the national system. The difference is that under the arbitration system, basically both sides voluntarily accept that they will go down the road of trying to resolve these issues by arbitration rather than through the national courts.

I want to give just another little bit of context, if I may, so the committee gets this. Why is this important to many member states which believe we need a system of investor protection? Companies frequently investing substantial sums of money in countries with unstable governments or legal systems can encounter real problems such as having their property expropriated or having changed terms of the investment in ways which can be very damaging. This is unfair and discriminatory. If they try to use the national courts in the country concerned, they may well lose because the government in question is able to change the law or manage the system. They wanted an independent system which could guarantee them certain rights to protect investments. That is the background. I fully agree with Deputy Howlin's suggestion that there is not much risk of that between Canada and the EU. Canada wanted very much to reform the system, as we did. We wanted to put into this agreement a working model of how one could have a better way of dealing with this issue than the traditional ad hoctribunal.

Citizens' rights under national law are unchanged. They would still be able to pursue their national rights. While I have not read the latest text, as I understand it, it is foreseen in the multilateral investment court that civil society and other actors can be party to the proceedings, make their views known and have their concerns taken into account. It is a fairly transparent and open process.