At the 16th European Union-China Summit that took place in Beijing in November 2013, the EU and China formally launched negotiations for an investment agreement. This was an important forward-looking initiative, constituting the first ever EU stand-alone investment agreement, covering both investment protection and market access.
Once concluded the agreement is expected to increase bilateral investment flows by tackling barriers to the making of an investment and by providing for a fair, transparent and predictable legal framework for investors in the EU and in China.
Importantly, the agreement will replace the 26 bilateral investment protection-only agreements currently in place between China and 27 EU Member States, thus providing an equal level of access to the market and a high level of protection for all EU investors in China, irrespective of the specific Member State of origin.
Specifically, the aim is to conclude an agreement that will:
- Provide for new opportunities and improved conditions for access to the EU and Chinese markets for Chinese and EU investors respectively;
- Address key challenges of the regulatory environment, including those related to transparency, licensing and authorisation procedures
- Establish certain guarantees regarding the treatment of EU investors in China and of Chinese investors in the EU, including protection against unfair and inequitable treatment, unlawful discrimination and unhindered transfer of capital and payments linked to an investment;
- Ensure a level playing field by pursuing, inter alia, non-discrimination as a general principle subject only to a limited number of clearly defined situations;
- Support to sustainable development initiatives by encouraging responsible investment and promoting core environmental and labour standards;
- Allow for the effective enforcement of commitments through investment dispute settlement mechanisms available to Contracting Parties and to investors.
The objective and key provisions of the agreement will be guided by the EU-Canada Comprehensive Economic and Trade Agreement (CETA) and EU-Singapore Free Trade Agreement (FTA), as well as by the EU text proposal for the Investment Chapter of the Transatlantic Trade and Investment Partnership (TTIP) with the US.