WASHINGTON (Reuters) - A trade deal between the United States and Europe is hard to imagine without strong investor protection, U.S. Trade Representative Michael Froman said on Thursday.
Negotiations on investor protection rules in the world's biggest trade deal have been frozen after criticism in Europe and the European Commission is digesting the results of a public consultation before deciding how to go ahead.
Froman said including investor-state dispute settlement provisions, which allow companies to bring claims against a government, would not impinge on a government's ability to regulate in the public interest.
"It's hard to imagine a high standard agreement ... that does not have a high standard of investor protections as well," he said at the Washington Ideas Forum.
European Union lawmakers have said they will reject any Transatlantic Trade and Investment Partnership (TTIP) agreement that contains investor protections and Germany, the bloc's biggest economy, also opposes such provisions.
But U.S. business groups are adamant the TTIP must include investor protections, or ISDS, or risk setting a bad precedent for investment negotiations with other countries, such as China.
It would be hard to line up U.S. support for a deal which did not include ISDS, said U.S. Council for International Business vice president for investment and financial services, Shaun Donnelly.
Outgoing EU Trade Commissioner Karel De Gucht has also said there will be no TTIP without an ISDS mechanism.
The Commission expects to make a decision on ISDS by the end of the year.
(Reporting by Krista Hughes; Editing by Lisa Shumaker)