‘EU for investment court system for dispute resolution under BIT’
NEW DELHI : The European Union (EU) has proposed an investment court system for dispute resolution as part of the bilateral investment treaty (BIT) under negotiation alongside the free trade agreement, European commissioner for trade Valdis Dombrovskis said. EU officials plan to discuss the proposal with finance minister Nirmala Sitharaman on Saturday, Dombrovskis said in an interview. In a sign of easing trade tensions, the EU trade chief said that settlement of outstanding disputes at the World Trade Organization (WTO) is also on the agenda.
The move gains significance as the WTO dispute settlement body is dysfunctional due to the US’ block on the appointment of judges. An investment court system, however, runs counter to India’s favoured method of resolving investment-related disputes under the so-called Model BIT. After several disputes led to adverse rulings and substantial monetary awards against India, the government in 2017 scaled back BITs it had signed and called for their renegotiation using a template from a model treaty that emphasizes state rights over investor rights, emphasizing the exhaustion of local remedies.
“India has an ambition to become a manufacturing hub and integrate itself with the global value chains, which requires a lot of investment. For this investment to come, there also needs to be proper investment protection and a proper mechanism to solve disputes as they arise. EU’s proposal of an investment court system is similar to what we had in a couple of other agreements.
We are awaiting India’s proposal on this," Dombrovskis said. “We have this arrangement in some of the more recent agreements. It’s a change of EU approach.
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