Written answers

Wednesday, 24 June 2015

Department of Jobs, Enterprise and Innovation

Trade Agreements

Photo of Finian McGrathFinian McGrath (Dublin North Central, Independent)
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147. To ask the Minister for Jobs, Enterprise and Innovation if he is aware of the consequences of the inclusion of the investor state dispute settlement mechanism in the transatlantic trade and investment partnership agreement; and if he will make a statement on the matter. [25403/15]

Photo of Richard BrutonRichard Bruton (Dublin North Central, Fine Gael)
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According to assessments made by the EU Commission, a comprehensive EU/US Free Trade agreement (TTIP) could over time boost EU GDP by 0.5% per annum bringing significant economic gains as a whole for the EU. This converts into 400,000 jobs across the EU. A study commissioned by my Department estimates that these benefits in Ireland will be proportionally greater than in the EU as a whole. It suggests growth in Irish exports of almost 4%, increases in investment of 1.5% and increase in real wages of 1.5%. It estimates somewhere between 5,000 and 10,000 additional export related jobs. The EU Commission’s mandate to negotiate with the United States on a new Free Trade deal includes in the scope (paragraphs 22 and 23), investment protection and investor-state dispute settlement (ISDS). The stated aim of negotiations on investment is to negotiate investment liberalisation and protection provisions on the basis of the highest levels of liberalisation and highest standards of protection that both sides have negotiated to date.

The mandate makes it clear that the inclusion of investment protection and ISDS will depend on EU interests being met and on the final balance of the Agreement. Importantly, the mandate states that the objectives of any investment protection provisions would be without prejudice to the right of EU and the member states to adopt and enforce measures necessary to pursue legitimate public policy objectives such as social, environmental, security, stability of the financial system, public health and safety in a non-discriminatory manner.

This means that the type of investment arbitration system under TTIP will be a vast improvement on investment protection in existing Bilateral Investment Treaties, some of which date back to the 1950’s.

The Commission’s Concept Paper, “Investment in TTIP and beyond – the path for reform”, published on 6 May, sets out the context for this reform and, building on the important progress that has been achieved in the investment agreements with Canada and Singapore, sets out four areas for further improvement: Governments’ right to regulate, establishment and functioning of tribunals, relationship between national judicial systems and an ISDS system, and an appellate mechanism.

These improvements are aimed at fixing the problems with investor dispute settlement in order to create a new modern system of investment arbitration. Ireland already provides the highest protection for investors by virtue of Article 43 of our Constitution, so the policy intention of the Commission in these negotiations is not new to Ireland.

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