Chief negotiators of the EU-Myanmar Investment Protection Agreement met on April 26th and 27th to discuss unresolved issues from the 4th round of negotiations held in December 2016. The discussions focused on the most recent aspects of the EU’s reformed approach to investor protection and investment dispute resolution. Among the key developments, a new code of conduct for Investment Court System judges was put forward. Agreement was reached regarding the main provisions of the reforms but further discussions will be held to settle the final details. The progress made at the meeting builds upon the previously established sections of the agreement on transparency and sustainable development.
The agreement represents an important development for prospective EU investors in Myanmar through the fostering of a more secure and predictable investment climate. An investment protection treaty provides rights for investors in Myanmar in case of expropriation or discriminatory treatment. It also requires “fair and equitable” treatment of investors. Most importantly, investors have access to an international disputes settlement mechanism even if the investment contract does not provide for any foreign arbitration. The introduction of an investment dispute settlement process provides a more viable pathway than in the past to impartial and transparent resolution of potential conflicts. Additionally, the promotion of improved administrative practices and transparency are aimed at facilitating a more streamlined and open environment for EU investors.
The Sustainability Impact Assessment (SIA) released by the European Commission in 2016 provides a thorough analysis of the agreement’s potential economic impacts. Among the takeaway points, the SIA concludes the agreement could lift the level of EU-sourced FDI in Myanmar closer to that of leading foreign investor countries. As Myanmar already maintains longstanding bilateral investment treaties with key actors such as China, India and Japan, the increased quality of legal protections will help to create a more level playing field and increase investor confidence. Furthermore, the SIA points to the strong incentives for increased EU investment in Myanmar as a result of the new guarantees and protections provided by the agreement.
The SIA can be viewed here.