This essay uses Putnam’s two-level game approach to analyse why CETA was firstly endangered but did eventually not fail because of the dispute on ISDS. I argue that this can be mainly explained by the overlapping of the win-sets, decisively rendered possible by the change of government in Canada.
In this essay, I will first of all evaluate the win-sets of both parties. Secondly, I will analyse how and why these win-sets did at first not overlap but eventually did, before concluding with an estimation of the usefulness of Putnam’s two-level game theory for European trade policy.
Table of Contents
1. Introduction – CETA, ISDS and two-level games
2. The European Union’s win-set
3. Canada’s win-set
4. From hardened fronts to a “clear break from the current ISDS system”
5. Putnam’s two-level game – a useful tool to analyse European trade policy?
Objective and Research Focus
This essay examines the negotiation and eventual signing of the Comprehensive Economic and Trade Agreement (CETA) between the European Union and Canada. The primary research goal is to determine to what extent Robert Putnam’s "two-level game" theory can explain why the agreement was initially endangered by disputes over Investor-State Dispute Settlement (ISDS) regulations but ultimately successfully concluded, highlighting the pivotal role played by shifts in government and changing win-sets.
- Application of Putnam’s two-level game theory to international trade negotiations.
- Evaluation of the EU’s win-set regarding geopolitical and economic interests.
- Analysis of Canada’s win-set and the impact of the 2015 change in government.
- The critical role of ISDS in the ratification process and the challenge of domestic opposition.
- Assessment of the applicability of two-level game theory within the specific multi-layered framework of European trade policy.
Excerpt from the Book
From hardened fronts to a “clear break from the current ISDS system”
Despite promising gains from CETA, several EU governments (also driven by domestic public opinion) made it clear after the publication of the treaty text that they could not accept CETA with the ISDS regulations included.36
In other words, even though the negotiators on Level I (EU Commission and the Canadian government) had agreed perfectly on the content of the treaty, its ratification seemed to be impossible because on Level II (EU governments and their constituencies) the opposition against one element of the treaty was huge enough to blow up the entire deal. Considering that the conservative Canadian government however was reluctant to renegotiate ISDS provisions37 (thus diminishing Canada’s win-set considerably), by mid-2015 CETA was far from being a “done deal”38. Level I at the Canadian side was not ready to give any further concessions and Level II at the European side was not willing to ratify the deal. In short: both win-sets did not overlap at this moment.
However, in order to reach an international agreement, the win-sets of both sides must overlap39, getting more likely with the increasing size of the parties’ win-sets.40 What eventually lead to a breakthrough was apparently the change of government in Canada from the conservative to the liberal party in October 2015, the latter willing to renegotiate on ISDS41, thus increasing again the Canadian win-set and resulting in an overlapping with the EU’s win-set. Along with the government, Canada’s preferences had apparently changed, from insistence on the original ISDS regulations to a fast treaty completion.42 Indeed, an agreement was reached in February 201643 satisfying the requests of previously critical EU governments which consequently signalled to support CETA.44
Summary of Chapters
Introduction – CETA, ISDS and two-level games: This chapter introduces the CETA agreement and the central conflict regarding ISDS, outlining the use of Putnam’s two-level game approach to analyze the negotiation process.
The European Union’s win-set: This section evaluates the factors influencing the EU's win-set, including geopolitical ambitions, economic expectations, and the impact of internal political fragmentation and ratification requirements.
Canada’s win-set: This chapter explores Canada’s economic and geopolitical motivations for the treaty, noting how its federal government structure and specific interests influenced the size of its win-set.
From hardened fronts to a “clear break from the current ISDS system”: This chapter details the deadlock caused by the original ISDS provisions and explains how the 2015 Canadian government change facilitated a compromise that allowed the win-sets to overlap.
Putnam’s two-level game – a useful tool to analyse European trade policy?: The concluding section critically assesses the utility of Putnam’s framework, suggesting it requires adaptation for the unique, multi-layered institutional structure of European trade governance.
Keywords
CETA, ISDS, Putnam, two-level game, European Union, Canada, trade policy, investor-state dispute settlement, win-set, ratification, geopolitical, trade agreement, negotiation, international relations, trade politics
Frequently Asked Questions
What is the core subject of this paper?
The paper analyzes the negotiation and conclusion of the Comprehensive Economic and Trade Agreement (CETA) between the EU and Canada, focusing specifically on the impact of ISDS disputes on the ratification process.
What are the central themes of the work?
The central themes include international trade diplomacy, the intersection of domestic and international politics, the role of investor protection mechanisms, and the political economy of treaty ratification.
What is the primary research question?
The research seeks to determine to what extent the "two-level game" theory can explain how the CETA negotiation survived severe domestic opposition to the ISDS components.
Which scientific methodology is applied?
The author applies Robert Putnam’s "two-level game" framework to map and analyze how international negotiators and domestic political stakeholders reconciled their competing interests.
What aspects are covered in the main body?
The main body examines the specific win-sets of the EU and Canada, the obstacles to ratification caused by public and governmental resistance, and the eventual compromise facilitated by political changes in Canada.
Which keywords define the research?
Key concepts include CETA, ISDS, two-level games, win-sets, and European trade policy governance.
How did the change in the Canadian government affect the treaty?
The change from a conservative to a liberal government in October 2015 provided the flexibility to renegotiate the ISDS provisions, which successfully expanded Canada's win-set and resolved the impasse.
Does the author consider the two-level game theory sufficient for EU politics?
The author concludes that while the theory is useful, it needs adaptation because EU trade policy involves an additional layer of complexity—"two two-level games"—incorporating international, domestic, and intra-EU bargaining.
- Quote paper
- Benedikt Weingärtner (Author), 2016, Innovative ISDS regulations in CETA, Munich, GRIN Verlag, https://www.grin.com/document/373602
