Lecture notes BIT

Lecture notes BIT - International investment treaties and...

Info iconThis preview shows pages 1–9. Sign up to view the full content.

View Full Document Right Arrow Icon
1 International investment treaties and Chapter 11 of NAFTA November 15, 2007
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
2 Topics in this lecture Goals and history of international investment agreements. Mechanics of the agreements (dispute settlement) Incentives to sign these treaties; the case NAFTA Empirical evidence of effect of treaties. The role of the investor-to-state provision The relation between trade and investment disputes
Background image of page 2
3 Goals of investment agreements Basic goal is to promote foreign investment by: i) Giving foreigners the right to invest in markets. ii) Treating foreign and domestic investment equally (e.g. regarding taxes). iii) Protecting foreign investment from government actions that decrease its values (expropriation). Investment requires (large) sunk costs and tends to be more risky than trade in products, therefore requires special protection.
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
4 History of multinational international investment treaties (Non-ratified) International Trade Organization contained provisions promoting liberalization of both trade and investment. GATT incorporated trade provisions but not investment provisions Late 90’s unsuccessful Multilateral Investment Agreement (Favored by EC and US, resisted by developing nations.) Early 2000’s continued attempts to introduce Investment Agreement into WTO (and resistance to these attempts).
Background image of page 4
5 Facts about Bilateral Investment Treaties (BITs) Over 2000 BITs. These became important during post WW II period when many former colonies were nationalizing foreign investment. Dispute tribunals: United Nations Commission on International Law and the World Bank’s International Settlement for Investor Disputes. Historically these were used to arbitrate disputes regarding narrow commercial interests, where strict confidentiality made sense. These fora are now used to arbitrate Chapter 11 complaints
Background image of page 5

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
6 NAFTA Chapter 11 dispute tribunal and appeals Tribunal consists of three members, one chosen by each party and the third chosen by compromise Only appeals process is via the domestic court system in which the tribunal is legally located. (e.g. Mexico appealed Metalclad case in a British Columbia court. The dispute between Mexico and US firm was eventually decided in Canadian court.)
Background image of page 6
7 NAFTA and Chapter 11 (the “Investment Chapter”) Chapter 11 of NAFTA was used as model for the failed Multilateral Investment Agreement. Preamble of NAFTA agreement states that objectives include the preservation of public welfare, the promotion of sustainable development, strengthening and enforcing environmental regulations. Do the investment rights in Chapter 11 conflict with these goals?
Background image of page 7

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
8 Mexico’s view of Chapter 11 of NAFTA By reducing risk, investment treaties (ITs) (presumably) promote investment. Prior to NAFTA (ratified in 1994) Mexico had
Background image of page 8
Image of page 9
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 30

Lecture notes BIT - International investment treaties and...

This preview shows document pages 1 - 9. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online