Proceedings of Annual Tokyo Business Research Conference
9 - 10 November 2015, Shinjuku Washington Hotel, Tokyo, Japan, ISBN: 978-1-922069-88-7
Impact of The Investor State Dispute Settlement in The TTIP:
Portuguese Analysis
Cátia Marques Cebola* and Ricardo Campos Fernandes**
This paper attempts to analyze the impact of the Investor State Dispute Settlement (ISDS) inserted
in the Transatlantic Trade and Investment Partnership between US and EU (TTIP). The ISDS
clauses grants a foreign investor the right to use dispute settlement proceedings against a
Government when the protected rights of the trade treaty are breached, usually using arbitration
courts. This possibility may jeopardize the State’s right to regulate public interests. In fact, most
ISDS cases concern governments’ administrative measures, such as the invalidation of licenses or
permits and land zoning. Therefore, the opponents of the ISDS clauses question their impact on
the governments’ ability to implement legal reforms and policy programs related with public
interests, such as environmental protection, labour rights or public health; since Governments
have to obey the arbitration court decisions that will be based on the treaty clauses and not on the
legal and constitutional rules of each country. We also highlight the lack of transparency on
arbitration proceedings as another critical issue. Furthermore, the parties elect the arbitrators, a
fact that might threat the independence and impartiality of the chosen referees. Nevertheless, data
shows that European judicial systems face several problems, with the slowness being one of the
main critical complications. Therefore, investment arbitration is essential in order to quickly and
effectively solve conflicts that may emerge from the TTIP implementation. Under a qualitative
methodology, we analyze the awards impact under the existing trade treaties indicating which
guarantees should be addressed in the TTIP to ensure that their positive economic effects are not
threaten by the ISDS clause.
JEL Codes: K4, K330
Track: Economics
Keywords: ISDS, TTIP, Investment, Arbitration
*Dr. Cátia Marques Cebola, CIEJ - Research Centre on Legal Studies, ESTG, Polytechnic Institute of Leiria, Portugal.
Email: catia.cebola@ipleiria.pt
**Dr. Ricardo Campos Fernandes, Lawyer, Portugal, Email: r.direito@hotmail.com