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Journal > Bilateral Investment Agreement Eu China

Bilateral Investment Agreement Eu China

April 8th, 2021

This would not be the first time that a Sino-Chinese bilateral agreement has hampered efforts between the EU and China to achieve their trade objectives. For example, it took China two years to remove the objections made primarily by the United States (the legitimate right of a third party) to conclude the ue-China agreement on cooperation and protection of geographical indications. Nor would it be the first time that the EU and the United States have competed for access to financial markets in China. With regard to the ongoing bilateral negotiations on trade and investment, some progress has been made recently. China and the EU have signed a bilateral agreement to protect 100 European geographical indications (“ISGs”) in China and 100 Chinese geographical eu companies from usurpation and counterfeiting. In addition, negotiations on the conclusion of the Comprehensive Investment Agreement (IAC) are expected to be concluded by the end of the year. The PGI agreement, concluded in November 2019 and in force from 2021, marks an important step in EU-China trade cooperation, as when it comes into force, it will bring reciprocal trade benefits and allow consumers to obtain quality products guaranteed on both sides. Finally, the EU-China agreement on China`s accession to the WTO (19 May 2000) concluded that, although China would maintain the 50-50 ceiling, China would offer a legal guarantee to avoid prudential interference in private contracts between life insurance joint venture partners. China immediately granted seven new licences for European life and life insurers. In addition, insurance activities were opened to foreign companies two years earlier than in China`s China-U.S. WTO accession agreement, and foreign brokers were allowed to operate in China five years after accession, without any joint venture requirement. The IAC would replace the 26 bilateral investment promotion and protection agreements between China and EU member states (Ireland does not have an ILO with China); Belgium and Luxembourg have a common agreement).

Foreign investors in China face many difficulties due to restrictions (or bans) on investments in certain sectors or services, in addition to bureaucratic procedures that regulate this investment flow, such as special licenses, registrations, licensing procedures, standards and/or certifications. In addition, it may be difficult for foreign investors to interpret the laws and guidelines governing their entry into the market and their businesses, which is often seen as more favourable to local businesses. In the past, ILOs in EU Member States have focused mainly on investment protection and dispute resolution. This also applies to the CAI. Among other things, negotiators have yet to agree on how to resolve disputes. The EU has proposed an investment justice system (ICS). Such a system is part of recent EU trade and investment agreements, such as the Trade Agreement with Canada (CETA) and investment agreements with Singapore and Vietnam. As far as the EU is concerned, it must recognise that the national treatment offered by China when it joins the WTO is subject to its GATS timetable, including financial services. Therefore, the EU`s requirements are WTO-plus in nature and are based on the principle of reciprocity. In other words, China has failed to meet its WTO obligations, with the exception of protecting its financial market through bureaucracy, as it has done for electronic payment services. Beyond the Phase 1 agreement, the EU must once again be pragmatic in recognising that alternative and competitive concessions, both inside and outside the financial services sector, could be a “potential landing zone” on the basis of national treatment. After all, China remains the EU`s second largest market, with many opportunities for EU companies to use it.

Following the situation, the conclusion of the IAC could be at risk by the end of 2020, as more difficult negotiations on access to financial markets are expected, not least because the