EU analyzes extending TPA for investment agreements from July 1
The United States government is at the juncture of extending the Trade Promotion Authority (TPA) for investment agreements, which will expire as of July 1, according to an analysis of the Congress of that country.
The TPA grants the US executive the power to carry out trade negotiations, and present the signed agreements to Congress, for it to ratify or disapprove, without modifying their content.
Without it, the chances of success of any negotiation are seriously diminished, since the current administration cannot guarantee that the results of the negotiation will be approved by the legislature on its terms. For the approval of this law by Congress, the objective of negotiating NAFTA in its trilateral character was set.
While some World Trade Organization (WTO) agreements address investment issues in a limited way, investment provisions in bilateral investment treaties (BITs) and bilateral and regional free trade agreements (FTAs) serve as primary tools. to establish investment rules at the international level.
Investment
The United States is part of the TBI or FTA with investment chapters with more than 50 countries.
These agreements generally aim to reduce restrictions on FDI and ensure non-discriminatory treatment of investors and investment, subject to national security and other exceptions, while balancing other political interests.
Controversies
They are generally enforced through binding arbitration under Investor-State Dispute Resolution (ISDS).
BITs require the approval of two-thirds of the United States Senate and FTAs require the approval of both Houses to enter into force in the United States.
Congress sets US investment negotiation targets in the 2015 TPA, which expires July 1, 2021.
These negotiating objectives seek to reduce or eliminate barriers to foreign investment and to ensure that foreign investors do not receive «greater substantive rights» for investment protection than US investors domestically.
The Mexico-United States-Canada Agreement (USMCA) contains the most recent set of investment commitments from the United States. It limits some fundamental protections for investors, including the elimination of ISDS with Canada and the reduction of the use of ISDS with Mexico.
Analysis
The US Congress may review the objectives of US investment policy in a possible debate on the renewal of the TPA, as well as in the configuration and supervision of possible future negotiations of FTA or BIT.
Congress may also examine investor protection issues with respect to emerging markets, given that the most recent US BIT talks with China and India stalled.
Another potential problem is the possible need for multilateral investment rules, as in the WTO and the (in principle) EU-China investment agreement.
