Investment Facilitation Talks Explore future Agreement Integration into WTO Legal Structure
WTO members taking part in the discussions on investment facilitation for development (IFD) made steady progress in negotiating a future Agreement at a new round of meetings on 4-5 October 2021. The meetings saw a high level of engagement and active participation, with delegations engaging in a conceptual discussion on the integration of the future IFD Agreement into the WTO legal structure, based on a series of guiding questions.
The discussion responded to a request in July by delegations asking the coordinator, Ambassador Mathias Francke of Chile, to have the opportunity to exchange views on how to integrate the future negotiated outcome into the legal architecture of the WTO. A first “academic discussion” on this subject took place in the margins of the intersessional meeting on 31 May — 1 June.
A series of questions prepared by the coordinator guided the deliberations. Among other things, participants discussed whether the issue of the legal architecture should be addressed jointly with other relevant joint statement initiatives (JSIs). They also discussed what pathway participating members would favour for the legal integration of the IFD Agreement — a stand-alone agreement, a scheduling approach (with members providing schedules of commitments), or any other innovative option.
Participants discussed the different options bearing in mind the specificities of the IFD Agreement, including its scope (applies to both goods and services); the “erga omnes” nature of most provisions (they would be implemented de facto on a non-discriminatory basis); and the strong development component (calling for comprehensive technical assistance and capacity building for its implementation).
While participants stated that their preferred option would be to achieve a “multilateral outcome” benefiting all WTO members (ideally an Agreement under Annex 1 of the Agreement Establishing the WTO, applied on an MFN-basis), they also remained open to consider other options. At the same time, participants highlighted that their priority, at this stage, was to advance as much as possible on the text of the Agreement.
Participants were also asked about their intention and readiness to apply the future IFD Agreement on a most-favoured nation (MFN) basis, thus conferring rights also to non-participants and potentially facilitating the consensus required for incorporating an IFD Agreement outcome into Annex 4 (Plurilateral Trade Agreements) of the Agreement Establishing the WTO. Finally, delegations shared their views on the application of a future Agreement on a provisional/interim basis and on the possibility of such provisional application being agreed in the margins of a Ministerial Conference.
The two days of meetings also served to continue negotiations on the different sections of the “Easter Text” — the document serving as a basis for the negotiations. Participants reviewed Section III (Streamlining and Speeding Up Administrative Procedures) and discussed Section V (Special and Differential Treatment — S&DT — for Developing and Least-Developed Country Members) focusing on a draft text prepared by the coordinator on provision 25 (General Principles for S&DT). Ambassador Francke requested the proponents of S&DT provisions to hold consultations, with the aim of finding a common text particularly on technical assistance and capacity building.
Participants also reviewed provisions 21 (Focal Points) and 22 (Domestic Regulatory Coherence) in Section IV and discussed provision 24 (Cross-border co-operation on investment facilitation) and a recent communication by Cambodia on this issue. In addition, participants discussed proposed provisions on “Home State Obligations” and “Transfers and Payments”.
A text proposal by Chile on “Non-Discrimination” was circulated to all WTO members. The proposal had been submitted as an alternative formulation for provision 4 (Most-Favoured-Nation Treatment). A more in-depth discussion on this text proposal will take place at the next intersessional meeting. Further negotiating meetings are scheduled (INF/IFD/W/29/Rev.2) for 2-3 November and 24 November, with intersessional meetings on 20-21 October and 16-17 November 2021.
Ambassador Francke thanked all delegations for their high-level engagement and active participation. He encouraged small/discussion groups, as well as delegations, to continue working among themselves between meetings in order to advance the negotiations and facilitate convergence.
Member-driven, transparent, inclusive and open to all WTO members, this joint initiative currently has the participation of over 100 members, up from the 70 that supported the Joint Ministerial Statement on Investment Facilitation for Development launched at the 11th Ministerial Conference held in December 2017 in Buenos Aires.
In a second Joint Statement on Investment Facilitation for Development issued on 22 November 2019, 98 members expressed support for the 2017 joint ministerial statement. They committed to intensifying work to further develop the framework for facilitating foreign direct investment and to work towards a concrete outcome on investment facilitation for development at the 12th WTO Ministerial Conference (MC12). Participating members also agreed to continue their outreach efforts towards non-participating WTO members, especially developing and least-developed members, to ensure that the future framework helps address their investment facilitation priorities and needs.