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Open letter

EU-Myanmar/Burma Investment Protection Agreement (IPA) and impact assessment


fail to protect human rights
Brussels, 5 December 2016
Dear Ms Malmstrm,
We are writing to express our serious concern over the final version of the report on the sustainability
impact assessment (SIA) for the EU-Myanmar investment agreement that is currently under
negotiation. The document that fails to retain recommendations that would establish human rights
safeguards should in consequence be rejected
In mid-2015 and early 2016, the EU adopted new guidelines to enhance the quality of its human rights
impact assessments. 1 In October 2015, the EU released its new trade and investment strategy that
commits the EU to enhance the analysis of the impact of trade policy on human rights both in impact
assessments and in ex-post evaluations based on the guidelines. 2 The strategy also aims at
implementing the EUs 2015-2018 human rights action plan, which commits the EU to continue to
develop a robust and methodologically sound approach to human rights impacts of trade and
investment agreements, in ex-ante impact assessments, sustainability impact assessments, and expost evaluations. 3
In October 2015, the EU launched the SIA for the EU-Myanmar investment agreement. Its terms of
reference (ToR) state that the EU should examine the potential impacts of the agreement on human
rights, in accordance with the European Commissions Better Regulation Package and the Guidelines
on the analysis of human rights impacts in impact assessments for trade-related policy initiatives. 4
FIDH regrets the ongoing failure to implement all these new guidelines and commitments, as the SIA
actually failed to meet the EUs standards. In a letter dated December 2015, commenting on the first
draft report issued as part of this SIA process, we recalled that the European Commission has the
1

The Better Regulation Package adopted by the Commission on 19 May 2015, its Better Regulation Guidelines and
Better Regulation tool 24 on Fundamental Rights and Human rights Commission Staff Working Document, "Better
Regulation Guidelines", SWD(2015) 111 final, 19 May 2015, http://ec.europa.eu/smartregulation/guidelines/docs/swd_br_guidelines_en.pdf http://ec.europa.eu/smartregulation/guidelines/tool_24_en.htm reaffirming the pre-existing Operational Guidance on taking account of
Fundamental Rights in Commission Impact Assessments dated 2011 Commission Staff Working Paper,
"Operational Guidance on taking account of Fundamental Rights in Commission Impact Assessments",
SEC(2011)567, 6 May 2011, http://ec.europa.eu/justice/fundamental-rights/files/operational-guidance_en.pdf ; The
Guidelines on the analysis of human rights impacts in impact assessment for trade-related policy initiatives
adopted in July 2015 European Commission, DG Trade, Guidelines on the analysis of human rights impacts in
impact assessment for trade-related policy initiatives, 2 July 2015
http://trade.ec.europa.eu/doclib/docs/2015/july/tradoc_153591.pdf and The New "Handbook for Sustainability
Impact Assessment", 27 April 2016 http://trade.ec.europa.eu/doclib/docs/2016/april/tradoc_154464.PDF
2
EU Commission, trade for all. Towards a more responsible trade and investment policy, October 2015,
http://trade.ec.europa.eu/doclib/docs/2015/october/tradoc_153846.pdf
3
Council conclusions on the action plan on human rights and democracy 2015 2019, July 2015,
http://www.consilium.europa.eu/en/press/press-releases/2015/07/20-fac-human-rights/
4
ToR Related to a contract to provide a Sustainability Impact Assessment (SIA) in support of an investment protection
agreement between the European Union and the Republic of the Union of Myanmar. Multiple Framework Contract
TRADE2014/01/01; request for services TRADE2015/B2/B03
http://trade.ec.europa.eu/doclib/docs/2015/october/tradoc_153820.pdf

www.fidh.org

responsibility to ensure that the guidelines are followed. We also insisted on the necessity for the
Commission to ensure the studys independence.5
In April 2016, commenting on the second step of the SIA (i.e. the draft final report issued on 18 March
2016), FIDH and its member organisation for Myanmar, ALTSEAN-Burma, welcomed the fact that,
despite some weaknesses, this first human rights impact assessment ever carried out in the context of
the EU trade and investment agreement, led to concrete achievements and proposals. The draft report
proposed to introduce concrete human rights safeguards directly into the agreement. It proposed the
introduction of human rights references in the clauses of the IPA. It recommended the establishment of
effective monitoring and enforcement mechanisms that could be used to address human rights and
human rights impacts. The SIA draft final report also proposed guidelines for the formulation of some
of the clauses negotiated to protect the investors (for example, on expropriation), it recommended
dispute settlement mechanisms, and proposed safeguards to better protect the right to regulate. These
safeguards would have provided a significant answer to the inexplicable lack of human rights
protections in the trade and investment agreements negotiated by the EU and would have participated
to prevent negative impacts on human rights, and to strengthen the respect for human rights and the
rule of law.6
Regrettably, the content of the final report, which was published in July 2016, was disappointing.
Compared to the draft version, the final report, was extensively modified. Its conclusions and
recommendations on human rights were significantly changed, watered down, or removed altogether.
As a result, the final report, in its current version, recommends business as usual vis--vis Myanmar.
This approach would result in the application to Myanmar of the EUs current model of its agreements
drafted for Canada, the US (i.e. developed countries that do not face the same human rights challenges
as Myanmar), or Vietnam (whose free trade and investment agreement has been negotiated and
concluded without carrying out a human rights impact assessment).
FIDH and ALTSEAN-Burma, as well as a number of experts and NGOs, consider that this approach is
a serious threat to the respect of human rights and disqualifies the agreement under EU and
international law. 7 In addition, the way in which the draft final report has been devoid of its substance
raises serious concerns
As highlighted by the UN, the preparation of human rights assessments prior to the conclusion of trade
and investment agreements is aimed at securing the respect, by EU Member States and their partner
States, of their human rights obligations.8 Human rights impact assessments fulfil an obligation under
Articles 3, 6, and 21 of the Treaty on European Union (TEU) and Article 207 of the Treaty on the
Functioning of the European Union (TFEU), which oblige the EU to shape its trade policies in a manner
that respects, promotes, consolidates and supports the rule of law and human rights.
Deriving from these legal obligations, the SIA is not a simple formality but needs to:
-

Identify and duly assess the human rights risks potentially created by the IPA under negotiation;

Be convincing in its reasoning, provide adequate recommendations, and present options that
effectively strike a balance between the IPAs twin objectives of: 1) protecting investors; and 2)
complying with human rights requirements, expectations and obligations. To this end, the
impact assessment should use all relevant information, effectively compare the various options,
alternatives, and mechanisms available, and assess the impacts of the wording of the clauses

Civil society dialogue meeting on the sustainability impact assessment (SIA) on the EU-Myanmar investment
protection agreement, 5/11/2015, Minutes, http://trade.ec.europa.eu/doclib/docs/2015/november/tradoc_153981.pdf
6
FIDH and Altsean-Burma, EU-Myanmar/Burma Investment Protection Agreement (IPA). Comments on Sustainability
Impact Assessments Draft final Report, Position paper, April 2016, https://www.fidh.org/IMG/pdf/313053268-eumyanmar-burma-investment-protection-agreement-ipa-comments-on-sustainability-impact-assessment-s-draft-finalreport.pdf
7
FIDH, Open letter: EU-Myanmar/Burma Investment agreement and its sustainability Impact Assessment - concerns
on the way human rights are taken into account, 7 December 2015 https://www.fidh.org/en/internationaladvocacy/european-union/eu-myanmar-burma-investment-agreement-and-its-sustainability-impact ; FIDH and AltseanBurma, EU-Myanmar/Burma Investment Protection Agreement (IPA). Comments on Sustainability Impact
Assessments Draft final Report, Position paper, April 2016, https://www.fidh.org/IMG/pdf/313053268-eu-myanmarburma-investment-protection-agreement-ipa-comments-on-sustainability-impact-assessment-s-draft-final-report.pdf
8
/HRC/19/59/&dd.5, Report of the Special Rapporteur on the Right to Food, Olivier De Schutter, Addendum, Guiding
Principles On Human Rights Impact Assessments of Trade and Investment Agreements, December 2011, p. 7

www.fidh.org

in light of the relevant arbitration cases and the specific context in which the IPA will operate (in
the case of Myanmar, the weak legislative framework, practices, and institutions with regard to
human rights). All these elements should lead to sensible conclusions and proposals.
In the human rights context, the European Court of Justice (ECJ) requires that the EU institutions prove
that they have carefully considered different policy options and have chosen the most proportionate
response to a given problem. 9 The European Commission equally recognizes that human rights
impacts assessments must support sound policy-making by analyzing the advantages and
disadvantages of available solutions, leading to the insertion of safeguards in the agreement when
needed and being transparent and convincing in their thinking10. The EU Ombudsman recalled these
principles in its decision, dated 26 February 2016, related to the EU-Vietnam free trade agreement. 11

The final report does not meet these criteria. Instead, it validates the European Commissions
approach (rejected by the EU Ombudsman in other circumstances), which consists of
concluding a trade or investment agreement without conducting a full prior human rights impact
assessment, and carrying out a retrospective human rights impact assessment in cases where
human rights have been negatively affected. The final report fails to provide specific and
convincing arguments to explain how the recommendations that it has made fulfil the EUs
human rights obligations. It also fails to explain how these recommendations are better suited
than the recommendations made by the human rights experts and stakeholders consulted to
strike a balance between protecting investment and strengthening human rights.

We therefore call on the European Commission to:

Recognize that the final report made for the EU-Myanmar IPA does not meet the quality
criteria required by the guidelines on human rights impact assessments and the SIAs ToR, and
that the significant changes in the recommendations are not supported by legal arguments and
reasoning.

Introduce in the text negotiated with Myanmar the proposals made by civil society and human
rights experts, which aim to ensure the respect, protection, consolidation and promotion of
human rights, including proposals regarding alternatives to ISDS/ICS.12

Set up a team of legal human rights experts in order to conduct a human rights impact
assessment that respects the guidelines and ensure the introduction in the investment
agreement of the clauses that aim at effectively preventing negative human rights impacts;and
at providing remedy mechanisms when prevention has failed.

Ensure better quality of future human rights impact assessments by:


o

Requesting in ToRs that the consultant has a proven human rights legal expertise and
track record;

Ensuring that the steering committee can guarantee the effective implementation of the

ECJ, C-310/04, Spain v Council ECR I-7318, paras 133-5 ; Commission Staff Working Paper, Operational Guidance
on taking account of Fundamental Rights in Commission Impact Assessments, SEC(2011)567, 6 May 2011,
http://ec.europa.eu/justice/fundamental-rights/files/operational-guidance_en.pdf; COM(2010) 543 final, Smart
Regulation in the European Union, 8 October 2010, p. 6, http://eurlex.europa.eu/LexUriServ/LexUriServ.do?uri=COM:2010:0543:FIN:EN:PDF
10

Commission Staff Working Paper, Operational Guidance on taking account of Fundamental Rights in Commission Impact
Assessments, SEC(2011)567, 6 May 2011, http://ec.europa.eu/justice/fundamental-rights/files/operational-guidance_en.pdf;
Commission Staff Working Document, Better Regulation Guidelines, SWD(2015) 111 final, 19 May 2015,
http://ec.europa.eu/smart-regulation/guidelines/docs/swd_br_guidelines_en.pdf; European Commission, DG Trade, Guidelines on
the analysis of human rights impacts in impact assessment for trade-related policy initiatives, 2 July 2015
http://trade.ec.europa.eu/doclib/docs/2015/july/tradoc_153591.pdf ; Handbook for Trade Sustainability Impact Assessment, Draft
2015 ; A/HRC/19/59/&dd.5, Report of the Special Rapporteur on the Right to Food, Olivier De Schutter, Addendum, Guiding
Principles On Human Rights Impact Assessments of Trade and Investment Agreements, December 2011
11 EU Ombudsman, Decision in case 1409/2014/MHZ on the European Commission's failure to carry out a prior human rights impact
assessment of the EU-Vietnam free trade agreement, 26 February 2016,
http://www.ombudsman.europa.eu/cases/decision.faces/en/64308/html.bookmark
12 Including FIDH and ALTSEAN-Burma, EU-Myanmar/Burma Investment Protection Agreement (IPA) Comments on
Sustainability Impact Assessments Draft final Report, April 2016, https://www.fidh.org/en/international-advocacy/europeanunion/eu-myanmar-burma-investment-protection-agreement-ipa-comments-on and FIDH EU-Myanmar/Burma Investment
Agreement and its Sustainability Impact Assessment, December 2015, https://www.fidh.org/en/international-advocacy/europeanunion/eu-myanmar-burma-investment-agreement-and-its-sustainability-impact.

www.fidh.org

guidelines to their full extent;

Setting up an independent quality monitoring and advisory body composed of


independent human rights experts;

Providing more time for the realisation of the SIAs in order to ensure better consultations
and a real dialogue between the consultant and the human rights defenders;

Publish the analysis of the legal service of the European Commission on the compatibility of the
text negotiated with Myanmar with Articles 3, 6, and 21 of TEU and Article 207 of the TFEU.

Signatories:
FIDH
ALTSEAN-BURMA

***
FIDH is an international human rights NGO federating 184 organizations from close to 120 countries.
Since 1922, FIDH has been defending all civil, political, economic, social and cultural rights as set out
in the Universal Declaration for Human Rights. FIDH's headquarters are in Paris and the organization
has offices in Abidjan, Bamako, Brussels, Conakry, Geneva, The Hague, New York, Pretoria, and
Tunis.

www.fidh.org