The backlash against investment arbitration has led to a wave of investment law reform. Approaches include creating obligations relating to investor conduct, clarifying existing disciplines, safeguarding policy space and revising ISDS mechanisms. This piece investigates the link between investment treaty design and the risk of arbitration claims.
The world is witnessing critical changes in a new generation of investment treaties, laws, policies and regulations. Egypt contributed to this process through revamping its national and international legal frameworks regulating investment. The new Egyptian Investment Law No. 72 of 2017 is at the core of this contribution.
In July 2018, Ecuador’s Ambassador released the zero draft of one of the most important international human rights treaties in recent years. How does this draft measure up to the high expectations and needs expressed by the international community and especially those in need of justice and reparation?
IISD is releasing an e-book summarizing and analyzing 10 treaty-based investor–state arbitration cases decided in the 2010s. The cases are relevant to a range of issues relating to sustainable development, including environmental protection, socio-environmental impact assessment, renewable energy, taxation, corruption and human rights.
In May 2018, the Dutch Ministry of Foreign Affairs published its new draft model bilateral investment treaty (BIT), in hopes to foster rethinking of existing and future Dutch BITs. Will this revised model achieve this goal, or does it fall short of the promised policy reset?
Third-party litigation funding (TPF) is a rapidly expanding industry composed of speculative investors who invest in a legal claim for control of the case and a contingency in the recovery. In the wake of the global financial crisis and the demand by speculative finance for new investment vehicles, TPF has discovered the regime of bilateral investment treaties (BITs) with investor–state dispute settlement (ISDS) mechanisms.
The right to regulate can be defined as states’ sovereign right to regulate in the public interest—their policy space. Because international investment agreements (IIAs) were created to limit certain aspects of countries’ right to regulate, the first wave of IIAs inhibited host countries’ regulatory experimentation that could be harmful to foreign investors’ rights.
Political positions and laws on foreign investment have been polarized into two opposing perspectives. On the one hand, there is the assumption that foreign direct investment (FDI) is essential for the economies of peripheral countries to take a leap toward development, prompting FDI promotion and even generating competition among countries to attract more investment.
Current and future investment treaties and chapters involving EU member states or the Union itself may be profoundly impacted by a landmark ruling of the European Court of Justice (ECJ). In this piece, the author explores the judgement from an EU constitutional point of view and analyzes potential consequences. Did the Achmea ruling come as a surprise to EU law insiders?
It will take time for dialogues on ISDS reform to produce results. In the interim, rather than continue to assume the unjustified risks associated with the flawed ISDS system, states could consider two near-term options. This piece looks at the advantages and disadvantages of each.
On the heels of our 11th Annual Forum of Developing Country Investment Negotiators, we interviewed Luis Guillermo Vélez, Director-General of Colombia’s National Agency for the Legal Defense of the State (ANDJE), to capture his experiences on investment negotiations and disputes, his expectations for investment reform processes and views on the value of the Forum.
Meaningful and effective remedies need to be provided to those injured by business-related human rights abuses. An intergovernmental working group at the United Nations is working to bridge gaps among stakeholders and negotiate a binding instrument on transnational corporations and other businesses with respect to human rights.
Tanzania passed three new laws in July 2017 that significantly change the regulatory landscape governing natural resources. The reforms are aimed at ensuring that foreign investment benefits Tanzanian citizens.From an African perspective, this article argues that it is time to rethink investment treaty regimes to ensure that they do not hinder much-needed reforms.
Over 300 experts gathered in Geneva to take stock of the sustainable development-oriented reform of the investment treaty regime and discuss policy options for modernizing the existing stock of older-generation treaties. Participants recognized that multilateral collaboration would be key to addressing the complex IIA regime.
In their new book, Jonathan Bonnitcha, LaugePoulsen and Michael Waibel develop a coherent structure for policy analysis of investment treaties that should attract interest as governments review their treaty policies. It argues that investment treaties as currently applied often appear poorly tailored to address identifiable economic concerns.
Two African developing countries respond to criticisms against the investment regime. The innovative treaty offers protection to foreign investors without compromising on the host state’s capacity to regulate in the public interest.
China has sustained robust inbound and outbound flows of foreign direct investment and expanded its web of investment treaties. This note sheds light on the country’s appearance in investment treaty cases in the past decade, either as home or host state.
Does the prospect of foreign investor claims against countries in investor–state arbitration lead to regulatory chill? The authors asked officials whether ISDS contributed to changes in the internal vetting of government decisions on environmental protection.
Host states have had the challenge to protect their citizens from human rights violations caused by multinationals. This paper explains the bases of states’ obligations under international human rights law and how foreign investors may be held responsible.
The Energy Charter Secretariat is in expansion mode, wanting to gain access to energy resources in Africa and Asia for its members—and extending a far-reaching and outdated investment protection system to investments in resource-rich countries.
The Base Erosion and Profit Shifting (BEPS) reform project led by the OECD tackles corporate measures aimed at shifting profits to no- or low-tax destinations. But investment law can hinder the implementation of much-needed reform in international taxation.
The problems of traditional BITs and the growing number of ISDS cases were among factors that led Brazil to develop the CIFA model, aimed at promoting and facilitating high-quality and productive foreign investment.
In theory, the common European market works based on principles that protect intra-EU cross-border investments. In practice, can these principles be reconciled with dozens of intra-EU BIT still in place?
Argentina has come back to the BIT negotiation arena after a 15-year halt, concluding a treaty with Qatar and engaging in ongoing negotiations with Japan. The new treaty includes traditional along with innovative provisions.
Developed by IISD and the United Nations Environment Program (UNEP), this toolkit is designed to help trade and investment negotiators by showing how specific provisions can better support sustainable development objectives.
Can the European Union act alone in concluding agreements such as CETA and the EU–Singapore FTA? Or must EU member states also ratify them? ECJ Advocate General Sharpston discusses the allocation of powers in the field of investment under EU law.
The Bolivian government has enacted three laws—on investment, arbitration and state-owned companies—that reflect the country’s public policy on domestic and foreign investment. Investing in Bolivia requires a careful reading of the three new laws.
In the context of disputes involving governments, settlement agreements threaten accountability, respect for the rule of law, transparency and respect for citizens’ rights and interests. Any reform agenda must cover settlements and the policy issues they raise.
Over 125,000 complainants requested a temporary injunction against Germany’s approval of the Canada–European Union Comprehensive Economic and Trade Agreement (CETA). While rejecting the request, what concerns did the German Federal Constitutional Court raise with respect to CETA?
The Government of India has proposed a Joint Interpretative Statement to its bilateral investment treaty (BIT) partners. The statement clarifies key substantive and procedural provisions, bringing them more in line with India’s new foreign investment policy.
Special and Differential Treatment (S&D), originally forged in the trade regime, has evolved in trade negotiations and gained momentum in investment agreements, to provide greater flexibility for developing countries based on their needs and capabilities.
As part of the World Investment Forum (WIF) 2016,[1] negotiators of international investment agreements (IIAs) and various stakeholders convened at the High-Level IIA Conference on July 19, 2016 in Nairobi, […]
The future operation of the investment dispute settlement facility of the Union of South American Nations is likely to generate scepticism, as it could undermine international standards in favour of regional parameters and lead to increased instability in the region. Alternatively, it could enhance the legitimacy and popularity of ISDS mechanisms in UNASUR member states. What are the procedural and substantive novelties contained in the Draft Constitutive Agreement?
Foreign direct investment became part of the sphere of exclusive competence of the European Union in 2009. Since then, the European Commission has been negotiating investment treaties with a number of countries—as well as authorized several individual EU member states to negotiate BITs.
States’ regulatory powers are the rule, and investors’ rights under international investment law are the exception. Or is it the other way around? Book review of Public Purpose in International Law.
Did you know that the United Kingdom’s treaty network is twice as consistent as that of Egypt or Pakistan? Have you noticed that 81 per cent of the TPP’s investment chapter is the same as the investment chapter in the U.S.–Colombia FTA, concluded ten years before, in 2006? Treating investment treaty texts as data can equip policy-makers, practitioners and researchers with a more sophisticated understanding of the universe of international investment agreements.
The Observatory is an intergovernmental initiative to provide information and exchange of knowledge and experiences on investment arbitration. It also aims at creating equal conditions between investors and states so as to promote sustainable investment that respects state sovereignty.
The popularity of BITs in large parts of the developing world was due to a failure to appreciate their bite. Why would so many governments sign up to some of the most potent instruments in international economic law without even caring to check what the treaties meant?
Legality of investor–state dispute settlement (including in the form of an Investment Court System) in EU trade agreements under EU law is a contentious issue. This article details four legal objections raised by academics and legal experts, and discusses the potential for a legal challenge of ISDS under EU law.
Argentina and Ecuador are now well experienced in ISDS and have had some success in defending domestic interests from investor claims. Lessons from these prior experiences could benefit other countries, particularly in the developing world, as they devise their legal defence strategies.
This week’s climate change negotiations should inform many spheres of global governance—including international trade and investment policy. One of the most important trade and investment agreements is the Trans-Atlantic Trade and Investment Partnership (TTIP)—currently under negotiation between the European Union and United States—given the role it will likely play in establishing rules for the global economy in the 21st century.
Those that propose that the environment needs “more investment protection” are recommending a very long-term solution (of questionable efficacy) to what is essentially a short-term problem.
Bolivia enacts Law No. 708, or the Conciliation and Arbitration Law (LCyA). LCyA was enacted (i) to preserve the public interest and the free will of the parties, (ii) to provide legal security (predictability) to both the state and the investor (iii) in a framework of equality and equity for both.
Heads of state of the United Nations came together in late September 2015 to formally adopt the 2030 Agenda for Sustainable Development, including a set of 17 Sustainable Development Goals (SDGs). These goals, which comprehensively address the economic, environmental, and social dimensions of sustainable development, set out a new vision for the world. To achieve that vision, international financial systems will have to play their part.
The inaugural session of the Open-ended Intergovernmental Working Group for the Elaboration of an International Legally Binding Instrument on Transnational Corporations and Other Business Enterprises (TNCOBEs) with respect to Human Rights (the Working Group) marks the beginning of a process to negotiate a binding treaty on business and human rights.
Since the signing of the first Agreement on Cooperation and Facilitation of Investments (ACFI) by Brazil, in March 2015, English translations of the document and analyses of its innovative aspects have been published. The hidden question is: to what extent do Brazil’s ACFIs innovate in the regulation of foreign investments?
Access to water is the driving force behind the surge in foreign investment in farmland. Yet, with all the focus on “land grabbing” and food security, water issues have received little attention. It is vital to understand all applicable legal regimes and the rights of all stakeholders.
This paper provides an overview of how the European Union and the United States promote labour rights in trade and investment agreements. It then warns that language in the investment and regulatory coherence chapters may contradict the language in the labour rights chapters. Finally, the paper suggests ways that TTIP can be redesigned to benefit workers and promote employment, based on interviews with 23 eminent scholars as well as original ideas from the author.
The international investment agreement (IIA) regime is experiencing an unprecedented surge in public attention. Prime examples are the debates surrounding the conclusion of the Canada–European Union Comprehensive Trade and Investment […]
Investor–state dispute settlement (ISDS), a concept much unknown to the broader public and even top policy-makers only a year ago, is making headlines, especially as the European Union and the […]