In the EU proposal for an investment chapter in TTIP, there is a provision on the "right to regulate" that seemed confusing to me, and certainly not as strong as a real exception. At the same time, some people apparently worried it was too strong.
It looks like the EU may now be weakening the provision, as evidenced by both the EU-Viet Nam FTA text, and the recently "scrubbed" CETA text. Here is the new CETA provision (Article 8.9, para. 1):
For the purpose of this Chapter, the Parties reaffirm their right to regulate within their territories to achieve legitimate policy objectives, such as the protection of public health, safety, the environment or public morals, social or consumer protection or the promotion and protection of cultural diversity.
The corresponding provision in the EU - Viet Nam FTA (Article 13 bis, para. 1) is nearly identical:
The Parties reaffirm the right to regulate within their territories to achieve legitimate policy objectives, such as the protection of public health, safety, environment or public morals, social or consumer protection or promotion and protection of cultural diversity.
By comparison, here's how the right to regulate provision read in Article 2.1 of the TTIP proposal:
The provisions of this section shall not affect the right of the Parties to regulate within their territories through measures necessary to achieve legitimate policy objectives, such as the protection of public health, safety, environment or public morals, social or consumer protection or promotion and protection of cultural diversity.
It's not clear to me what impact any of these provisions will have on the interpretation of other investment provisions. But putting that aside, don't the new CETA and Viet Nam provisions seem much weaker than the TTIP one? Instead of "shall not affect," from the TTIP proposal, what we have now is merely "reaffirming" a right that seems to already exist. What will adjudicators do with this latter language, for example, when evaluating whether particular government actions are "manifestly arbitrary"?
On the political side of things, does this change alleviate the worries of U.S. critics who thought the proposed TTIP language was too strong, and wanted something that would have less impact? Can the U.S. now get on board with an Investment Court? (As long as no one refers to it as an Investment Court, of course.)