Thank you very much.
It's my honour to appear before you as a witness. Thank you for inviting me. I will provide my opening remarks in English, but I'm bilingual—I'm a Montrealer—so feel free to interact with me in either language.
I'm a partner in the law firm Norton Rose Fulbright, which is a global law firm. We have an important presence in Canada, with offices across the country. I'm based in Montreal, and I'm the head of the international arbitration practice for the firm in Canada. My practice is devoted almost entirely to the practice of international arbitration. It's split about evenly between commercial arbitration between private parties, generally businesses, and investor state arbitration disputes between investors and host states.
I endorse many of the comments I heard from the first two speakers, in particular those relating to the benefits of the agreement in respect of opening up trade and investment. I have perhaps a slightly different perspective on the investor state dispute resolution mechanism in the treaty, which, as Ms. Barrington mentioned, has gone through some changes in the last little while. Let me also make it clear that I'm speaking in my personal capacity. My comments really reflect my own views and not the views of my firm generally or of any clients for whom I might appear in proceedings.
What are my general views on the investor state dispute resolution mechanism as currently reflected in the treaty? I think we need to step back and recognize, as Louise Barrington did, that there have been criticisms of investor state arbitration.
I recall being at a number of conferences a few years ago where isolated voices claimed that these were secret tribunals that were biased against countries, and so on. Frankly, it was a bit of a niche criticism. I thought it was often misinformed and tended to exaggerate certain information. We've seen, over the last year or two, this criticism amplified by various movements, including by groups who are opposed to globalization generally, in my view. This has resulted in some of the opposition we've seen, in particular during the negotiation of both CETA and the transatlantic partnership.
In the context of CETA, it appears to me that there's been an effort to appease the critics by making successive changes or various promises regarding the mechanism. First there was a move away from the traditional investor state dispute settlement model that Louise Barrington described. That's the traditional model of arbitral tribunals established for each individual case, where the investor and the host state can each appoint an arbitrator. Usually there's a third arbitrator who is appointed by those two to resolve the dispute. We've moved now, in the text, to the model of a permanent tribunal selected only by the states, with individual cases to be decided by so-called divisions of the tribunal. This model is being referred to as the “investment court system”, even though it's still very much based on a model of arbitration because the rules applicable will be various arbitration rules.
Most recently, in order to get the treaty adopted in Europe—I think this is very important for members of the committee to realize, although you probably already do—there's been an agreement to suspend the application of even this new model. There's been an agreement to suspend the application of the dispute resolution model until all 28 national parliaments in Europe ratify the treaty. To my understanding, based on published reports out of Europe, there is a serious risk that at least Belgium, anyway, does not have the political will or the support in all of its federal and regional parliaments to ratify CETA's investment court system in its current form.
Where are we right now with CETA? It looks as though the appeasement has not worked. The critics are not appeased. They want a fully fledged, multilateral investment court and an appellate mechanism, with all traces of the arbitration mechanism removed. You can see this in the text of the treaty. Article 8.29, I believe, refers to that effort to continue working on some sort of multilateral investment tribunal.
I'll wrap up with these next two points.
What does this mean for Canada and Canadian companies and investors? For now, CETA has no investment protection regime, because it will be suspended during provisional application. Basically, unless you have that kind of mechanism, none of the substantive protections for investors can be enforced, so what is the future of the investment protection regime? It's highly uncertain. In my view, Canadians would have been better served with the traditional arbitration model in CETA. As I said, much of the criticism, in my view, has been misguided or misinformed, and frankly—