CYIL vol. 9 (2018)

CYIL 9 ȍ2018Ȏ CHALLENGES OF BILATERAL INVESTMENT BETWEEN THE CZECH REPUBLIC AND CHINA • ensure the free movement of payments, capital, and key personnel necessary for international investment”. Before the TFEU, EU Member States could negotiate their investment protection agreements. Therefore, 1,400 bilateral investment treaties (BITs) which represent about half of the world’s BITs, were concluded prior to the enactment of the TFEU. 9 Most of these BITs contain fundamental protection standards with slight consideration regarding the environment and labour protections. When the EU negotiates its own agreements, a higher- level standard applies; for instance, societal concerns have been integrated, a higher level of market access is enhanced, other modern and innovative provisions are considered. 10 EU investment policy establishes its protection system, namely the EU as an independent entity to perform in IIA negotiation. Tracking back to 2015, the EU set up its Trade for All Strategy, which proposed“ • a stronger emphasis on the right of countries to regulate in the public interest • clearer investment protection rules • a public investment court system to solve investment disputes ” 11 In this strategy, the EU draws attention to global values by designing its own rules. For instance, a more transparent trade and investment policy is required by the EU; a more responsive approach to the public’s expectations on regulations and investment is addressed; a trade agenda to promote sustainable development, human rights, and good governance; the new investor-state dispute settlement (ISDS) mechanism, and the investment court system has been proposed. Moreover, the common policy of the EU also preserves the rights of MS to regulate economies in the public interests. For instance, in September 2017, the EU proposed a regulation (The Regulation) and released a working paper to establish a framework for screening foreign direct investments into the EU. 12 “The Regulation aims to harmonize existing or proposed national screening mechanisms of Member States by providing common criteria and standards (or a set of minimum requirements), and to create a new oversight role for the European Commission (EC) itself to review FDI.” 13 This regulation allows a MS to operate its screening system with necessary flexibility by taking national circumstances and individual legitimate interests into consideration. The key features of this regulation include monitoring the role of the EC, setting up requirements for MS, and listing the screening factors. The Regulation offers the EC the right to screen transactions that are likely to affect the interest of the EU. To ensure transparency of the screening, an annexe subject to the regulation lists the projects under which the EC could make its opinion to the MS, correspondingly, the MS shall consider this opinion, otherwise providing an explanation to the EC when this opinion is not followed. Despite the fact that the opinion of the EC is non- 9 EC, ‘EU Investment Policy State of Play’< http://trade.ec.europa.eu/doclib/docs/2013/april/tradoc_150853 > [accessed 7 March 2018]. 10 Ibid. 11 EC, ‘Trade for All’ < http://trade.ec.europa.eu/doclib/docs/2015/october/tradoc_153846.pdf > ; EC, ‘Investment’ < http://ec.europa.eu/trade/policy/accessing-markets/investment/ > [accessed 7 March 2018]. 12 2017/0224(COD), SWD(2017) 297 final. 13 YIN, Wei & ZHANG, Anran. ‘A New Proposed EU Framework for Screening Foreign Direct Investment’, Leiden Law Blog , (10 October 2017), < https://leidenlawblog.nl/articles/a-new-proposed-eu-framework-for- screening-foreign-direct-investment > [accessed 7 March 2018].

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