GETTING TO KNOW THE EPA: Provisions on Services and Investment
Does the EPA text include provisions on Services and Investment?
Yes. The EPA contains a comprehensive section on Investment and Services as well as common rules on E-commerce.
Why does the EPA include provisions on Investment?
While European investments into CARIFORUM have generally increased over the last decade, investment flows in recent years have been stagnant in most non-tourism sectors. The Parties agreed to investment liberalization in the EPA, in order to establish rules that facilitate the easier flow of investment across the borders of the European Union and all CARIFORUM countries, and a reduction in discriminatory treatment of foreign investors within their respective territories, and greater predictability and transparency. Such an agreement will benefit CARIFORUM countries in terms of transfer of technology, creation of jobs, quality products and services; while creating a more favourable investment climate for their investors in the European Union. The EU is a significant outward investor, with nine (9) EU members ranking in the top twenty leading outward investor economies. Therefore a properly managed relationship with the EU should create viable opportunities for CARIFORUM, and stimulate growth and dynamism in EU investment flows to the Caribbean.
What are the provisions on Investment in the Agreement?
The EPA rules on investment prescribe the conditions of market access in manufacturing, mining, agriculture and forestry, and service sectors in European and CARIFORUM states. Except for some sensitive sectors, both the EU and CARIFORUM have liberalized several areas of manufacturing. However, public services and utilities and other sensitive sectors have not been opened to foreign participation. CARIFORUM has maintained special reservations for small and medium enterprises in some sectors. The EU also has excluded a few sectors and maintains reservations in some sectors for some of its newer member states. In the European Union (EU), CARIFORUM investors will be treated in the same way as nationals of the European Union. This means that CARIFORUM investors within the EU would be treated no less favorably than domestic EU investors within the EU, and vice versa. In addition, most-favoured nation treatment will apply, which means that investors from a ‘third country’, a country that is not Party to the EPA, will not be given better treatment than CARIFORUM investors within the EU, and vice versa. The EPA includes provisions which guarantee that investment liberalization does not result in high social and environmental costs. This has been facilitated through the inclusion of rules that ensure that investors safeguard the Environment and maintain high labour and occupational health and safety standards. Furthermore, it forbids investors from engaging in corruption to get special concessions from public officials.
