Implications of the Eco Oro Decision for Investment Treaty Negotiations and Reforms

In a recent decision, the investment tribunal in Eco Oro v. Colombia held that a GATT-style environmental exception in the Canada–Colombia bilateral investment treaty (BIT) did not preclude Colombia from enacting certain regulatory measures but implied an obligation to compensate the investor. This interpretation is widely considered to have disregarded Canada’s and Colombia’s intentions when signing the BIT. It also raises serious concerns for how arbitrators interpret states’ treaty language designed to protect policy space for environmental regulation and other public interest issues.

Similar exceptions are widely used in existing International Investment Agreements (IIAs), including recent instruments. What does this mean for developing countries’ efforts to reform existing and negotiate new investment treaties? This webinar provided a platform for developing country investment negotiators to discuss this award, share lessons learned, and reflect on concrete solutions.

Focussing on the perspective of investment treaty negotiators, panellists discussed key issues in the wake of Eco Oro: What was decided, and which types of treaty provisions are affected? What are the implications for the existing stock of old-style treaties, model treaties and their recent updates? How can the decision inform countries’ strategies in defending ISDS claims? Ultimately, what lessons could be drawn from the Eco Oro decision in the context of current global reform processes of the international investment policy regime?

Moderator

• Dr. Suzy Nikièma, Lead Sustainable Investment, Investment Law and Policy Program (ELP), International Institute for Sustainable Development (IISD)

Speakers 

• J. Benton Heath, Assistant Professor at Temple University, Beasly School of Law
• Simon N. Batifort, Partner, Curtis, Mallet-Prevost, Colt and Mosle LLP
• Nyaguthii Maina, International Law advisor, ELP, IISD
• Lukas Schaugg, International Economic Law Fellow, ELP, IISD

This webinar is part of a larger series of webinars aimed at supporting developing country investment negotiators as they consider options for reform. Prior webinars on similar issues can be found here.