On 18 January 2024, Steptoe and the British Institute of International and Comparative Law (BIICL) held a launch event for their joint empirical study on performance requirement prohibitions (PRPs) in international investment agreements (IIAs) (recording and publication available here).

The main focus of this empirical study is PRPs.  PRPs are a distinct type of treaty provisions that appear in many IIAs and that seek to curtail States’ ability to impose performance requirements.

According to UNCTAD, performance requirements are “stipulations, imposed on investors, requiring them to meet certain specified goals with respect to their operations in the host country”.  Performance requirements come in the guise of either: (i) conditions precedent to that State’s authorisation for an investor to make, expand or operate an investment in its territory; or (ii) conditions for an investor receiving a State advantage (e.g., a tax credit, a subsidy or other form incentive).  Some of the most common forms of performance requirements include local content requirements, local sourcing requirements, export performance requirements, import restrictions, export controls/restrictions, and technology transfer, licensing and/or local R&D requirements.Continue Reading Industrial Policy Is Making a Comeback – With Some Investment Treaty Protections Standing in Its Way

On 14 December 2022, the Council of the EU (“Council”) and the European Parliament (“Parliament”) adopted Regulation (EU) 2022/2560 of the European Parliament and of the Council on foreign subsidies distorting the internal market (the “Foreign Subsidies Regulation” or “FSR”), which was published in the EU’s Official Journal on 23 December 2022. The FSR gives the European Commission (“Commission”) substantial new powers to investigate “financial contributions” granted by non-EU governments to companies operating in the EU and, where necessary, take measures to redress their distortive effects. Specifically, the Commission will be able to conduct such investigations through three new tools: two notification-based tools to investigate concentrations and bids in public procurements above certain thresholds and a general tool to investigate all other market situations and lower-value mergers and public procurement procedures.Continue Reading The EU’s Foreign Subsidies Regulation Gets Adopted

On September 19, 2022, the European Commission (“Commission”) presented the Single Market Emergency Instrument (“SMEI”), a crisis management framework designed to secure supply chains of “identified, strategically important goods and services” within the European Union (“EU”) during times of emergency.  The SMEI was introduced as a response to the significant structural issues in the EU’s supply chain of critical goods and services, which were highlighted by the COVID-19 pandemic.  Comments on the Proposed Regulation are currently due on December 17, 2022.Continue Reading The EU Single Market Emergency Instrument: Comparing the SMEI Against the U.S. Defense Production Act  

On 29 August 2022, the European Union’s (“EU”) International Procurement Instrument (“IPI”)[1] will enter into force. The IPI was adopted on 23 June 2022 after more than a decade of legislative preparations and discussions. It provides for a new trade policy tool which is designed to address the perceived lack of a level playing field in global procurement markets.

The IPI will enable the European Commission (“Commission”) to impose measures limiting non-EU companies’ access to the EU public procurement market if these companies’ governments do not offer similar access to EU businesses. Specifically, the IPI envisages two types of measures that can be applied: i) a “score adjustment” penalty on tenders submitted by suppliers from the targeted third country; or ii) the exclusion of such tenders from the procurement process. Such IPI measures would be applied following an investigation by the Commission, and after consultations with the country concerned.
Continue Reading EU’s International Procurement Instrument to Enter into Force at the End of August