Commission proposes new rules to help SMEs with dispute resolution under CETA

The new rules streamline and simplify dispute resolution procedures, making it easier for SMEs to access the investment court system (ICS) foreseen by CETA, and saving them time and money.

Such improved access is particularly relevant in the context of the tremendous uptake by SMEs of the opportunities created by CETA. Since the agreement provisionally entered into force in 2017, more than 2,500 new EU SMEs have started exporting to Canada or investing in the country.

Details of the proposal

The new rules will introduce an expedited procedure for dispute resolution under CETA, to which SMEs and natural persons, as well as claims below a certain level, will have preferential access. It will be possible for these litigations to be heard by a one-member – instead of a three-member – tribunal, and timelines will be shorter. A further streamlining of the rules to improve access of SMEs will be possible following regular reviews.

The new rules will also contain built-in protections for the State (as the defendant), to ensure that the expedited procedure is used by those who need it most and to avoid abuse.

Next steps

The Commission’s proposal, which follows the conclusion of technical negotiations between Canada and the EU on the new rules in February 2024, will now go to the Council for approval. It will be formally adopted by the CETA Joint Committee once internal approval procedures on the EU and Canadian sides are complete. The new rules will enter into force together with the rest of the investment protection and investment dispute resolution parts of CETA, once the agreement has been fully ratified.

For more information

Proposal for a Council Decision

CETA

Investment Court System (ICS) under CETA

Access2Markets: guidance for SMEs and companies on accessing investment dispute resolution mechanisms under CETA and other EU agreements