Considerations on the judgement of the BVerfG on the conclusion of CETA

• Author: Susanna Villani
• Pages: 231-250

Studi Tributari Europei 1/201 7

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Considerations on the judgement of the BVerfG

on the conclusion of CETA *

Susanna Villani 1

Table of Content

1. Introduction. 2. Subject-matter of the action. 3. The decision of the

German Constitutional Court. 4. Subsequent developments: a focus on the

provisional application of CETA. 5. Conclusions

1. Introduction

After about five years of rounds of negotiations concluded in September

2014, the EU-Canada Comprehensive Economic and Trade Agreement

(CETA)2 provisionally came into force on 21 September 20173 as a result of

the signature on 30 October 2016 by the President of Canada and of the

Presidents of the EU institutions involved – European Commission, Council

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* How to quote this article: S. VILLANI, Considerations on the judgement of the BVerfG on the

conclusion of CETA, in Studi Tributari Europei, n. 1/2017 (ste.unibo.it), pp 231-250, DOI:

10.6092/issn.2036-3583/8778.

1 Susanna Villani, Postdoctoral research fellow in EU Law, University of Bologna.

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2 See, Comprehensive Economic and Trade Agreement (CETA) between Canada, of the one

part, and the European Union and its Member States, of the other part, OJ L 11 of

14.1.2017. In the same edition of the Official Journal there are also the following acts:

Decision of 28 October 2016 on the provisional application of the Comprehensive Economic

and Trade Agreement (CETA) between Canada, of the one part, and the European Union and

its Member States, of the other part; Join t Interpretative Instrument on the Comprehe nsive

Economic and Trade Agreement (CETA) between Canada and the European Union and its

Member States; Council Decision (EU) 2017/38 of 28 October 2016 on the provisional

application of the Comprehensive Economic and Trade Agreement (CETA) between Canada,

of the one part, and the European Union and its Member States, of the other part.

3 See, European Commission, The CETA Agreement comes into force, 20 S eptember 2017 ,

available at http://europa.eu/rapid/press-release_IP-17-3121_en.htm.

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and European Council – and the approval by the European Parliament on 15

February 201 74.

CETA is an example of the so-called ‘new generation’ free trade agreements

(FTAs) concluded by the European Union. In particular, it intends to abolish

99% of all the customs duties and many other obstacles for the commercial

operators by providing for specific provisions on the access to the market

for goods, services, investments and public procurement as well as on

intellectual property, sanitary and phytosanitary measures, sustainable

development, regulatory cooperation, mutual recognition and removal of

technical barriers. Moreover, it contains provisions on the establishment of

an independent Investment Court System (ICS), composed by a permanent

Tri buna l an d an Ap pel lat e Tri buna l, c ons tit ut ed b y ju dge s ap po in ted by

States for resolving disputes between governments and investors known as

investor-state dispute settlement (ISDS). Hence, this structure, to be

activated just according to certain conditions, should replace the current

ISDS system wherein the disputes are settled by ad hoc arbitration panels

appointed by the parties5, thereby making the settlement faster and less

costly6. Moreover, CETA underlines the commitment of the parties to

collaborate for the creation of an International Multilateral Court that the

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4 See, European Parliament legislative resolution of 15 February 2017 on the draft Council

decision on the conclusion of the Comprehensive Economic and Trade Agreement (CETA)

between Canada, of the one part, and the European Union and its M ember States, of the

other part (10975/2016 – C8-0438/2016 – 2016/0205(NLE)) (Consent).

5 In this regard, it is particularly relevant the recent judgement of the EU Court of Justice in

Achmea where it has declared that the arbitration clauses contained in the bilateral

agreements on investments do not comply with the EU legal order because, inter alia, they

jeopardise the principle of autonomy. See, ECJ, Slovak Republic v. Achmea, judgement of 6

March 2018, ECLI:EU:C:2018:158. Tes ta me nt to th e fa ct th at th e me ch ani sm fo r d is pu te

settlement in the field of investments represents one of the more controversial issues of the

common commercial policy, Belgium requested to the ECJ an Opinion on the compatibility of

the jurisdictional system for the protection of investments set by the CETA with the Treaties.

See, Opinion 1/17, Request for an opinion submitted by the Kingdom of Belgium pursuant to

Article 218(11) TFEU, OJ C 369 of 30.10.2017. For a complete reference to the Belgian

request, see Belgian request for an opinion from the European Court of Justice, available at

https://diplomatie.belgium.be/sites/default/files/downloads/ceta_summary.pdf.

6 See, D. Gallo, “Portata, estensione e limiti del nuovo sistema di risoluzione delle

controversie in materia d’investimenti nei recenti accordi sul libero scambio dell’Unione

Europea”, in Diritto del Commercio Internazionale, 2016, pp. 846-852.