When a state grants\u00a0 MFN and\/or national treatment to a treaty partner, this means it needs to treat investors from the partner state no less favourably than it treats investors in like circumstances from other states or domestic investors. From an environmental perspective, it will be important to ensure that states retain the right to distinguish environmentally sound investments from those investments and operations that will or may potentially harm the environment. For example, to encourage the production of renewable energy, states may want to treat it more favourably than fossil fuel production. Similarly, a state might wish to regulate one operation more heavily\u2014and therefore less favourably\u2014than another similar operation because it is situated in an environmentally sensitive area.<\/p>\n
In trade law, GATT specifies that discrimination is only prohibited between \u201clike products.\u201d Being prudent, some recent investment agreements, analogous to GATT, have begun explicitly clarifying that discrimination is only prohibited when it is between investors or investments in \u201clike circumstances\u201d or \u201clike situations.\u201d In order to provide additional guidance, parties could incorporate language and criteria to clarify what constitutes \u201clike circumstances\u201d or \u201clike situations.\u201d If applied properly, these criteria should avoid situations in which two investments with different environmental impacts are found to be in \u201clike circumstances,\u201d and therefore cannot be legally treated differently.<\/p>\n
States may also choose to omit MFN obligations from the agreement altogether. Several agreements do this, not so much for environmental reasons, but rather to avoid allowing investors to import provisions from other BITs that the parties never intended to apply between them (see Section 5.4.2.2<\/a>).<\/p>\n","protected":false},"excerpt":{"rendered":" When a state grants\u00a0 MFN and\/or national treatment to a treaty partner, this means it needs to treat investors from the partner state no less favourably than it treats investors in like circumstances from other states or domestic investors. From an environmental perspective, it will be important to ensure that states retain the right to… Read more »<\/a><\/p>\n","protected":false},"author":7,"featured_media":0,"parent":134,"menu_order":0,"comment_status":"closed","ping_status":"closed","template":"","meta":{"_acf_changed":false,"footnotes":"0"},"class_list":["post-205","page","type-page","status-publish","hentry"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.iisd.org\/toolkits\/sustainability-toolkit-for-trade-negotiators\/wp-json\/wp\/v2\/pages\/205","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.iisd.org\/toolkits\/sustainability-toolkit-for-trade-negotiators\/wp-json\/wp\/v2\/pages"}],"about":[{"href":"https:\/\/www.iisd.org\/toolkits\/sustainability-toolkit-for-trade-negotiators\/wp-json\/wp\/v2\/types\/page"}],"author":[{"embeddable":true,"href":"https:\/\/www.iisd.org\/toolkits\/sustainability-toolkit-for-trade-negotiators\/wp-json\/wp\/v2\/users\/7"}],"replies":[{"embeddable":true,"href":"https:\/\/www.iisd.org\/toolkits\/sustainability-toolkit-for-trade-negotiators\/wp-json\/wp\/v2\/comments?post=205"}],"version-history":[{"count":0,"href":"https:\/\/www.iisd.org\/toolkits\/sustainability-toolkit-for-trade-negotiators\/wp-json\/wp\/v2\/pages\/205\/revisions"}],"up":[{"embeddable":true,"href":"https:\/\/www.iisd.org\/toolkits\/sustainability-toolkit-for-trade-negotiators\/wp-json\/wp\/v2\/pages\/134"}],"wp:attachment":[{"href":"https:\/\/www.iisd.org\/toolkits\/sustainability-toolkit-for-trade-negotiators\/wp-json\/wp\/v2\/media?parent=205"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}