International News

EU could drop investment from major trade deals: commissioner

BRUSSELS, July 10, (APP/AFP) – The European Union
could drop investment from major free trade deals in an effort to ease ratification, a top EU official said on Monday as Brussels is set to
begin talks on the issue with Japan.
European Commission vice president Jyrki Katainen spoke just days
after EU and Japan formally agreed the broad outlines of a landmark trade deal but with the highly sensitive investment portion still left
unresolved.
“We have to discuss with (EU) member states on this issue but I
wouldn’t be surprised if they agree,” said Katainen, who oversees
investment issues at the EU executive.
“Let’s keep free trade agreements as they are … and then
investment-related issues could be seen, or must be seen … separate from
trade deals,” the former Finnish premier said in response to a question
by AFP.
Japan and the EU are still very far apart on investment and
so-called investment courts, a controversial mechanism usually included
in trade deals to resolve disputes.
This mechanism has come under furious opposition in Europe and the
EU is trying — so far unsuccessfully — to persuade international
partners to adopt a new system staffed by public as opposed to private sector officials.
A publically run system as desired by Brussels “will take some
time” even if it is the “good sustainable solution”, Katainen said.
But Japan insists on sticking to the old system, which is a
deal-breaker for the Europeans.
The issue became even more pressing after the EU’s highest in
court in May said trade deals that included investment would require
ratification by all the EU’s national parliaments, instead of far less
risky fast-track approval by the national governments.
“With many of our partners, (an) investment agreement is not the
utmost importance,” Katainen said, implying that Europe could in some
cases put the issue on the side, at least for now.
While investment “plays a role in the future” of EU free trade
agreements, for the time being and with certain countries they are not necessarily the top priority, he said.