I propose to take Questions Nos. 17 to 22, inclusive, and 34 together.
The EU’s new approach to investment protection includes the Investment Court System (ICS), which will replace the long-standing Investor-State Dispute Settlement or ISDS mechanism. The European Union and its Member States are keenly aware of the criticisms of the ISDS system. To overcome the shortcomings attributed to the ISDS system, the EU and its Member States have put forward new reforms addressing these concerns head-on. This new, progressive system contains investment protection provisions that are balanced against a State’s right to regulate in the public interest.
The Government is currently progressing the Arbitration (Amendment) Bill 2025 in Dáil Éireann as part of ongoing efforts to take forward ratification of the EU-Canada Comprehensive Economic and Trade Agreement (CETA) and other international agreements containing similar ICS investment dispute resolution provisions. The preparation of this Bill has been informed by careful assessment.
These agreements include clearly defined investment protection standards, including on fair and equitable treatment, and provide clear guidance to standing dispute resolution Tribunals on how these standards should be applied. Furthermore, in order to ensure that Tribunals in all circumstances respect the intent of the Parties, the agreements establishing these Tribunals include provisions that provide for the issuance of binding notes of interpretation where serious concerns have arisen as regards matters of interpretation. In the case of CETA, the Joint Interpretative Instrument confirms that “Canada and the European Union and its Member States are committed to using these provisions to avoid and correct any misinterpretation of CETA by Tribunals.”
These agreements include provisions that affirm that the Parties preserve their rights to regulate for public policy purposes. They also provide that investment protection provisions shall not be interpreted as a commitment from governments that their legal frameworks will remain unchanged. The agreements further clarify that the fact that a measure may negatively affect an investment or affect an investor’s expectations of profits is not sufficient to say that the measure is inconsistent with the agreement.
