110 research outputs found
Book Review: Lillich & Magraw eds., The Iran-United States Claims Tribunal: Its Contribution to the Law of State Responsibility
Investor-State Disputes under NAFTA: The Empire Strikes Back
This Article examines the growing opposition to arbitration of investor-state disputes involving challenges to regulatory measures under Chapter 11 of NAFTA. The NAFTA Parties apparently seek to restore national sovereignty over such matters by subjecting these awards to heightened review by municipal courts at the seat of arbitration, effectively giving Canadian, Mexican, and United States courts the final authority to interpret Chapter 11. When successful, this practice violates both the letter of Chapter 11 and the intent of the NAFTA Parties to place investor-state disputes within the deferential legal framework of international commercial arbitration. Although the NAFTA Parties may, escape liability for such unlawful conduct, they threaten to undermine the past century\u27s efforts to promote robust principles of state responsibility for economic injuries to aliens. Furthermore, routine derogation from the principle of voluntary acceptance of authoritative decisions rendered at the international level by impartial bodies charged with supervision of treaty compliance bodes ill for the development of the rule of law in international economic relations
What I Tell You Three Times Is True: U.S. Courts and Pre-Award Interim Measures Under the New York Convention
Against Imperial Arbitrators: The Brilliance of Canada\u27s New Model Investment Treaty
Investment treaty arbitration has become politically “toxic” even in states that pioneered the development of investment treaties. There is consensus on the need for reform. But there is a dearth of historical research on what went wrong with investment treaties, when it happened, or how to find the way forward in light of the past. As a result, reform efforts have a stumbling quality. One can see this in multilateral fora, such as the United Nations Commission on International Trade Law (UNCITRAL), where over four years of study and negotiations have produced little consensus. One can also see it in the investment treaty practice of individual states, such as Canada, which has recently lurched across the spectrum from investment treaty arbitration to a permanent international investment court, to the abandonment of investor-state dispute settlement (ISDS), and back to investment treaty arbitration. This article fills the gap in understanding by explaining what went wrong with investment treaty arbitration and when it happened. It demonstrates that the customary international law on state responsibility for injuries to aliens evolved during the 19th century to protect foreign investors against exceptional failures of the nightwatchman and rule-of-law states. As the consensus regarding customary international law standards of treatment unraveled during the 20th century due to the spread of communism, decolonization, and economic nationalism, capital-exporting states turned in bilateral investment treaties (BITs) to uphold traditional principles regarding the protection of foreign investment. Starting in the late 1990s, however, an unexpected surge of claims brought under NAFTA’s investment chapter fortuitously opened the door to the central problem of modern investment treaty practice: the rise of “imperial arbitrators” who do not merely police exceptional failures of the nightwatchman and rule-of-law states, but who choose to second-guess the normal operations of modern regulatory states without any meaningful checks or balances. Although the NAFTA Parties nipped that development in the bud, the rise of imperial arbitrators leapt to the broader universe of investment treaty arbitration, where it flourished until claims against developed states for measures such as the phaseout of nuclear power brought investment treaty arbitration to a crisis point. Seeking a way forward in light of the past, the article examines Canada’s recent experimentation with investment treaty reforms, including the development of a permanent international investment court in relations with the EU, the complete elimination of ISDS in relations with the United States, and a return to traditional investment treaty arbitration in a new model investment treaty coupled with substantive reforms that virtually eliminate opportunities to second-guess the normal operations of modern regulatory states. The article describes the last option as the most brilliant because it is the only one that substantively eliminates toeholds for imperial arbitrators while preserving arbitration as a safeguard against the exceptional failures of the nightwatchman and rule-of-law states. Seeking a way forward in light of the past, the article examines Canada’s recent experimentation with investment treaty reforms, including the development of a permanent international investment court in relations with the EU, the complete elimination of ISDS in relations with the United States, and a return to traditional investment treaty arbitration in a new model investment treaty coupled with substantive reforms that virtually eliminate opportunities to second-guess the normal operations of modern regulatory states. The article describes the last option as the most brilliant because it is the only one that substantively eliminates toeholds for imperial arbitrators while preserving arbitration as a safeguard against the exceptional failures of the nightwatchman and rule-of-law states
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