Belgium asked the European Court of Justice on Wednesday (6 September) for its view on the EU-Canada free-trade agreement, part of a compromise reached with its French-speaking Wallonia region, which had threatened to block the deal last year.
The Comprehensive Economic and Trade Agreement, known as CETA, will still take effect on a provisional basis on Sept. 21, with reduced import tariffs on a range of goods.
But full implementation of the accord, including chapters related to investment, will happen only after ratification by all 28 member states. In the case of Belgium, that will require approval by federal and regional parliaments.
Wallonia last year threatened to block even provisional application of CETA, principally over the issue of investor protection, the provision allowing multi-nationals to sue governments in special courts.
The provision, which critics says enables foreign companies to sidestep local courts and challenge government policy, was the focus of mass protests, notably in Germany.
As part of a deal struck with Wallonia, the Belgian federal government is asking the court if the CETA investment provisions are compatible with EU law, including the supremacy of the European Court of Justice and the right of access to courts and to an independent judiciary.
The European Commission, which negotiates trade deals on behalf of the 28 EU members, believes its investment court system, with tribunal judges to settle disputes, answers some of the critics of existing dispute mechanisms, who complain that arbitrators are not impartial.
Environmental activist law group ClientEarth said there were serious doubts that CETA would survive scrutiny by the European court.
“If the ECJ proves us right, it would be a huge victory for the rule of law and for judges across Europe,” said its trade lawyer, Laurens Ankersmit.
“Trade agreements that allow investors to go to special tribunals and sideline ordinary courts are not acceptable. We welcome the fact that the European Court of Justice will now decide on the legality of the Investment Court System. If it finds this system to be in contravention of EU law, it will be the end of CETA as we know it,” added Paul de Clerck, Economic Justice programme coordinator at Friends of the Earth Europe.