1st August 2014

Will Germany stop the EU-Canada FTA?

Germany is reportedly considering rejecting the EU-Canada free trade deal, which is currently being negotiated. According to Brussels diplomats, the deal provides for such a strong investment-protection mechanism, that investors might stop or reverse certain laws in force in the EU28, mainly in the environmental area. Germany has reportedly made it clear, that a deal with provisions on investor-to-state dispute settlement mechanism as they are negotiated now, will not pass in Germany. With that, the deal would be dead. Far worse is, however, that the EU-Canada deal is seen as a test for the TTIP and fears grow, that if one falls, the other will eventually fall, too. Responding to Germany´s concerns, the Commissioner for trade Karel De Gucht organized public consultation in investor-to-state dispute settlement mechanism. Also, according to the Commission, a strong mechanism is needed otherwise Canadian companies will not invest in the EU. Canadian trade ministry stated, that the bilateral deal with Germany has provisions far tougher, than the new EU-Canada agreement and therefore investment protection should not be an issue. The deal will come into force, once definitively negotiated, after it has passed a vote by the Member States and by the EP. It is expected to raise EU-Canada trade by one fifth to €26 billion a year.

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Members of the American Chamber of Commerce in the Czech Republic