Investment Protection Agreement between the EU and Vietnam

 

SUMMARY OF:

EU-Vietnam investment protection agreement

Decision (EU) 2019/1096 on the signing, on behalf of the EU, of the Investment Protection Agreement between the EU and the EU countries, of the one part, and the Socialist Republic of Viet Nam on the other

WHAT IS THE AIM OF THE AGREEMENT?

The EU-Vietnam Investment Protection Agreement (IPA) will ensure a high level of investment protection, while allowing the EU and Vietnam to regulate for and pursue legitimate public policy objectives, such as protecting:

• public health;
• safety; and
• the environment.

KEY POINTS

The agreement contains all the innovations of the EU’s new approach to investment protection and its enforcement mechanisms that are not present in the 21 existing bilateral investment treaties between Vietnam and EU countries. It is a very important feature of the IPA that it replaces and improves upon these existing treaties. The IPA has been negotiated together with a free trade agreement.

In line with the objectives set by the negotiating directives, the European Commission ensured that EU investors and their investments in Vietnam will be granted fair and equitable treatment and not be discriminated against compared to Vietnamese investments that are in similar situations.

At the same time, the IPA protects EU investors and their investments in Vietnam from expropriation*, unless it is for public purposes:

• in accordance with due process;
• on a non-discriminatory basis; and
• against payment of prompt, adequate, and effective compensation according to fair market value of the expropriated investment.

The IPA also offers investors the option of a modern and reformed investment dispute resolution mechanism. This system ensures that investment protection rules are adhered to and seeks to strike a balance between protecting investors in a transparent manner and safeguarding the right of a country to regulate in order to pursue public policy objectives. The agreement sets up a standing international and fully independent dispute resolution system, consisting of permanent First Instance and Appeal Tribunals that will conduct dispute settlement proceedings in a transparent and impartial manner.

DATE OF ENTRY INTO FORCE

The agreement needs to be ratified by by each of the parties according to their respective internal legal procedures before it can come into force.

BACKGROUND

See also:

• Guide to the EU-Vietnam trade and investment agreements (EU Delegation to Vietnam)
• Memo: EU and Vietnam reach agreement on free trade deal (European Commission)
• In focus: EU-Vietnam investment protection agreement (European Commission)
• Commission presents EU-Vietnam trade and investment agreements for signature and conclusion (European Commission)
• EU-Vietnam Trade Agreement — memo (European Commission).

KEY TERMS

MAIN DOCUMENTS

EU-Vietnam investment protection agreement

Council Decision (EU) 2019/1096 of 25 June 2019 on the signing, on behalf of the Union, of the Investment Protection Agreement between the European Union and its Member States, of the one part, and the Socialist Republic of Viet Nam, of the other part (OJ L 175, 28.6.2019, pp. 1-2)

RELATED DOCUMENTS

EU-Vietnam free trade agreement

Framework Agreement on Comprehensive Partnership and Cooperation between the European Union and its Member States, of the one part, and the Socialist Republic of Viet Nam, of the other part (OJ L 329, 3.12.2016, pp. 8-42)

Successive amendments to the agreement have been incorporated into the original document. This consolidated version is of documentary value only.

last update 22.02.2019