AUTONOMY TO SET THE LEVEL OF REGULATORY PROTECTION IN INTERNATIONAL INVESTMENT LAW

State Autonomy ◽

Competing Interests ◽

Investment Treaty ◽

Investment Law ◽

Regulatory Protection ◽

The Right ◽

Abstract This article argues that State autonomy in setting the level of protection for permissible regulatory aims can be better operationalised in the investment treaty regime. The article draws on comparative insights from WTO law, where it is established that WTO members have the right to determine the level of protection for permissible regulatory aims, although significant disciplines are placed on the means used to achieve those aims. It is then argued that investment treaties are, properly interpreted, consistent with the idea that States retain autonomy to determine the level of protection for permissible regulatory aims. Finally, the article proposes removing from the fair and equitable treatment and indirect expropriation standards proportionality balancing stricto sensu, as this undermines State autonomy in setting the level of protection. Overall, this article argues for a partial reorientation of investment law, in which non-discriminatory measures that pursue a permissible regulatory aim, including at a particular level, should not amount to a breach of a treaty where a State uses the means that involve the least possible restriction of the competing interests protected by relevant investment treaty obligations.

The Application of the Principle of Proportionality to Assess Compensation: Some Reflections Arising from the Case of Joseph Charles Lemire v. Ukraine

The Law and Practice of International Courts and Tribunals ◽

10.1163/15718034-12341275 ◽

2014 ◽

Vol 13 (2) ◽

pp. 199-222

Author(s):

Sondra Faccio

Keyword(s):

Case Law ◽

International Human Rights Law ◽

Human Rights Law ◽

Investment Treaty ◽

Investment Law ◽

Principle Of Proportionality ◽

In the last few years, the principle of proportionality has appeared with a certain frequency in international investment case law: arbitrators have employed it to determine whether the State’s regulatory measure under scrutiny represents a form of indirect expropriation, to assess violations of the fair and equitable treatment (‘fet’) standard, to counterbalance competing obligations drawn from international investment law and international human rights law, and to assess compensation. This article will focus on the so-called “quantum phase” – the part of the award devoted to the assessment of the monetary compensation due to the foreign investor for the breach of the investment treaty provision – and will discuss whether the principle of proportionality can effectively play a role in the assessment of compensation. The work will start from the analysis of the case of Joseph Charles Lemire v. Ukraine, where arbitrators expressly resorted to proportionality to verify whether the indemnity awarded to the claimant for the breach of the fet standard was adequate in light of the specific characteristics of the investment lato sensu and the investor, to then approach the issue of proportionality more in detail.

Beyond Gold Reserve Inc. v Bolivarian Republic of Venezuela: The Host State’s Capacity to Regulate Extractive Activities in Light of Canadian Firms’ Experience in International Investment Treaty Arbitration

Canadian Yearbook of international Law/Annuaire canadien de droit international ◽

10.1017/cyl.2015.13 ◽

2015 ◽

Vol 52 ◽

pp. 261-295

Author(s):

JEAN-MICHEL MARCOUX

Keyword(s):

Investment Treaty ◽

Treatment Provision ◽

Gold Reserve ◽

Investment Agreement ◽

Investment Law ◽

Negative Impacts ◽

AbstractIn a recent award involving Gold Reserve Inc., an international investment arbitral tribunal concluded that Venezuela had to pay compensation of US $713 million for violations of the fair and equitable treatment provision of an international investment agreement between Canada and Venezuela. This decision contrasts sharply with the outcome of other investment disputes concerning Canadian extractive companies. Relying on a detailed analysis of awards involving EnCana Corporation, Glamis Gold Ltd. and Vannessa Ventures Ltd., this article recalls that host states can take measures to increase the benefits and limit the negative impacts of extractive industries’ activities without breaching their obligations under international investment law.

The Limits of the Comparative Public Law Methodology in International Investment Law: An Australian Case Study

University of New South Wales Law Journal ◽

10.53637/dxbe7638 ◽

2018 ◽

Vol 41 (2) ◽

Author(s):

Alexander Ferguson

Keyword(s):

Public Law ◽

Investment Treaty ◽

Australian Case ◽

Legitimate Expectations ◽

Investment Law ◽

Government conduct is increasingly reviewable by investment treaty tribunals. These tribunals often consider whether a host state has failed to afford fair and equitable treatment by defeating a foreign investor’s legitimate expectations. To discern what a foreign investor can legitimately expect, some tribunals use a comparative public law methodology that draws on domestic public law. Using Australian law as a case study, I suggest that the comparative public law methodology may not be able to achieve all of its aims.

States' Reassertion of Control over International Investment Law: (Re)Defining ‘Fair and Equitable Treatment’ and ‘Indirect Expropriation’

Reassertion of Control over the Investment Treaty Regime ◽

10.1017/9781316779286.013 ◽

2016 ◽

pp. 285-308 ◽

Cited By ~ 4

Author(s):

Eric De Brabandere

Keyword(s):

Investment Law ◽

Fair and Equitable Treatment Between the International and National Rule of Law

The Journal of World Investment & Trade ◽

10.1163/22119000-12340141 ◽

2019 ◽

Vol 20 (4) ◽

pp. 513-552 ◽

Cited By ~ 1

Author(s):

Velimir Živković

Keyword(s):

Decision Making ◽

Rule Of Law ◽

The Rule Of Law ◽

Investment Protection ◽

National Rule ◽

Investment Law ◽

Abstract Promoting the rule of law is a potentially strong legitimating narrative for international investment law. Illustrating the interlinkage, the ubiquitous ‘fair and equitable treatment’ (FET) standard embodies distinctly rule of law requirements. But these requirements remain open-textured and allow understanding their meaning in either more ‘international’ or ‘national’ way. An ‘international’ understanding – detached from the host State’s vision on how the rule of law should look like – should remain dominant. But I argue that decision-making under the FET standard should also involve a systematic engagement with how these requirements would be understood in the host State’s law and how they were complied with from that perspective. Whilst not determinative for establishing a breach, this assessment better respects the expectations of the parties, strengthens the persuasiveness of findings and helps enhance the national rule of law as a key contributor to the ultimate goal of investment protection – economic development.

International Investment Arbitration: Substantive Principles, Principles of International Investment Law and The Fair and Equitable Treatment Standard in International Foreign Investment Law

British Yearbook of International Law ◽

10.1093/bybil/79.1.378 ◽

2009 ◽

Vol 79 (1) ◽

pp. 378-388

Author(s):

C. Baltag

Keyword(s):

Foreign Investment ◽

Treatment Standard ◽

Investment Arbitration ◽

Investment Law ◽

Preventing the Regulatory Chill of International Investment Law and Arbitration

International Law Research ◽

10.5539/ilr.v9n1p85 ◽

2020 ◽

Vol 9 (1) ◽

pp. 85

Author(s):

Atif M. Alenezi

Keyword(s):

Foreign Investors ◽

Regulatory Changes ◽

Resolution System ◽

Investment Law ◽

Foreign Corporations ◽

Equitable Treatment ◽

Legitimacy Crisis

International investment law has increasingly come under attack because it does not put host states on par with foreign investors. Foreign investors can evoke broad investment rights and pursue investment arbitration. The threat of substantial arbitral awards can result in host states not enacting policies, regulations, laws or reaching decisions, despite them being needed in order to protect a variety of important public interests. The concern is, therefore, that international investment law, including the investor-state dispute resolution system, causes a regulatory chill. The paper examines how the asymmetric relationship between foreign investors and host states can be remedied, so that trust in international investment law is strengthened and its legitimacy crisis is overcome. One core issue with international investment law is that the customary international minimum standard and its therein subsumed full protection and security, and fair and equitable treatment and compensation principles are inherently vague, thereby contributing to the overprotection of foreign investors. Arbitral cases further highlight how regulatory changes can result in host states incurring liability and thus enable foreign corporations to shift potential costs and risks. International, and national solutions to prevent the regulatory chill of international investment agreements are spelled out.

Fair and Equitable Treatment and Investor’s Due Diligence Under International Investment Law

Netherlands International Law Review ◽

10.1007/s40802-020-00170-7 ◽

2020 ◽

Vol 67 (2) ◽

pp. 233-255

Author(s):

Yulia Levashova

Keyword(s):

Due Diligence ◽

Host State ◽

Political Background ◽

Legitimate Expectations ◽

Investment Law ◽

The Stability ◽

Abstract The investor’s due diligence has become a significant factor in determining whether the legitimate expectations of an investor give rise to protection under the FET standard. This is especially relevant when an investor’s claim for the protection of its legitimate expectations is based on the stability of a regulatory framework. The investor’s due diligence in the context of the FET standard goes beyond the risk-based business due diligence performed by a foreign investor for its own benefit. It has implications for a state’s right to regulate in the public interest and a broader notion of business responsibilities. Investors are expected to conduct proper due diligence before investing in a host state by demonstrating their reasonable efforts to collect information about the rules and regulations that are pertinent to the proposed investment. In some cases, due diligence extends to an investor’s duty to assess the possible risks related to the broader economic situation and socio-political background of a host state. Focusing on the recent renewable energy awards, this article analyses and clarifies the role of due diligence in the context of the FET standard, as well as its potential application for asserting responsible business conduct in the broader framework of international investment law.