Types and Subtypes of Sustainable Development Provisions in International Investment Agreements

28th May, 2024 - 10:38 am Categories: News & Updates 0 Comments

INTRODUCTION

TRLs (Transparency and disclosure) are the fifth category of the Executive Order. The main goal of TRLs is writing the regulations and liquidity measurement rules for the investment systems that operate nationally and internationally, and on a city level. They may as well cover the ways of such laws and policies are thought of and implemented. Use our instant AI to create an interesting and unique sentence. The AI is powered by GPT-3, a state-of-the-art language model. Starting today, create engaging paragraphs that will hook your audience! Because transparency in law is a vital component of good governance, it is an indication of what could be regarded as the social area of sustainable development.

Corresponding to the release document are the procedural transparency provisions (TRAs). JSIs are about provisions on the transparency of dispute resolution method of ISA. TRA`s functions may cover different aspects of proceedings within the frames of IIA, such as e.g. publishing arbitration activities, including arbitration awards and written submissions, arrangement public access to hearings of arbitration proceedings and providing third parties with appropriate participation in proceedings of arbitration (e.g. through amic curiae disposition). TROs have started receiving the attention ot IIAM -making as ISA starts revealing its public law nature began to be generally recognised.

Countering, thwarting, and preventing external threats to any nations’ security (NES) is the eighth subject. The main purpose behind the role of the North Atlantic Treaty Organization is the protection of the host country’s national security against any potential threats. Being national security seen as a community benefit of a state or an entire international community where a status of such a security is almost unavoidably connected to the well-being of a state, it gets its essential part in maintaining the state’s overall positive development. This will build on the view of NES as a nominal SDP of IIAs.

And, the business responsibility approach (RBP) or corporate policy aftermath (CSR) forms the eighth category. What RBPs are, short and clear, is mainly the deepening of the IIAs content by raising foreign investors’ responsibilities. Though the individuals with capital are also a part of transnational investment activities, what is more prominent in multinational businesses (MNEs) and global investment governance structure are investors, whose investors are, predominantly, multinational businesses. Doubts about the sustainability of growth with them might come, but the same can be true about the prospects that the factor of migration fosters for the development of the hosting states. On the one hand, it may be argued that a big part of the investors’ behavior is determined by the international laws and the case-by-case domestic laws of the host countries and, on the other hand, the imposition of certain requirements on the investors is not only necessary but also relevant by IIAs. RBPs carries the responsibility as it is not only for host countries to understand the sustainable issues and how to address them, but also the rules and regulations that relate to the environment and human rights stressed in RBPs are the very elements that enable sustainable development to realize its environmental and social pillars

In conclusion, to round up the provision of these points is the firm. First, while the following forms of SDPs are common in IIAs, they are not an exhaustive list of all SDPs in current IIAs. Second, the topic matters of the various types of SDPs varies, which influences the character and function of the SDPs to some extent. Some SDPs, such as ENVs, GENs, and NES, are designed to address “traditional” types of sustainable development concerns, such as environmental protection and national security; other SDPs are designed to address various social aspects of sustainable development, such as labour rights and human rights protection, as well as the rule of law in global investment governance. These SDPs are classified as “social SDPs,” as they primarily affect ATCs, LHRs, TRAs, TRLs, and RBPs. Third, because the notion of sustainable development is ever growing, future IIAs are likely to include “novel” sorts of SDPs. For example, human society is undergoing tremendous technological improvements today, and data security has recently emerged as an increasingly crucial and pressing issue for states and individuals. Though the precise effects of such technology innovation on global investment governance are not yet evident, it is not surprising that future IIAs may include provisions to address this issue.

Major SDP subtypes

The availability and types of SDPs contained in the IIA, as well as their practical usefulness, determine whether or not an IIA is sustainable development-oriented. The practical efficiency of SDPs is mostly judged through their subtypes. In this study, each and every SDP is classified into a specific subtype based on the nature of the duties imposed by the SDPs. The following sections explain the many subtypes of SDPs.

GENs are frequently declarative in nature (DEC), and they frequently appear in the preambles of IIAs. Treaty preambles can assist in interpreting treaty sections as “context” under Article 31, and in determining the purposes and purpose of the treaty under Articles 18 and 60 of the 1969 Vienna Convention on the Law of Treaties (VCLT).[i] Arbitration practise has confirmed such assisting features in a number of ISA instances, including Siemens v. Argentine[ii] and Vivendi v. Argentine.[iii] Despite their usefulness, treaty preambles do not confer contractual rights or responsibilities on the contracting parties, even if they may represent customary law standards and form an integral element of a treaty.[iv] In this respect, GENs have limited practical usefulness because they cannot compel contracting nations or foreign investors to take measures for long-term development.

ATCs are further subdivided into three categories. The first category is declaratory (DEC), which primarily calls on contracting states and investors not to engage in corrupt practises. The second type requires contracting states (AOS) to either take anti-corruption measures or refrain from engaging in corruptive behaviour. The third category is directly related to foreign investors (AOI), either requiring them not to engage in corruptive behaviour or punishing them for such behaviour.

ENVs are the most common type of SDP in current IIAs, and they are further subdivided into three types. The first subtype is referred to as a non-derogation requirement on contracting states (NDG), which effectively requires states not to decrease their environmental laws or standards in investment governance in order to avoid a “race to the bottom” in environmental protection. The second kind primarily tries to confirm or recognise that contracting states have obligations under national or international laws to take essential actions to protect the environment, human, animal, or plant life, and public safety and health (CON). The third subtype is exceptive in nature (EXP), which exempts contracting governments from taking environmental measures that are otherwise inconsistent with their IIA duties.

LHRs, which can be further categorised into four subtypes, are becoming increasingly prevalent in IIAs nowadays. A reference to external human rights or labour rights standards (REF), such as the ILO core labour standards or standards in other international human rights agreements, is the first subtype. Such a reference does not always include the external standards as a legally binding component of the IIA. The second kind is the non-derogation obligation (NDG), which requires contracting states not to decrease human rights or labour rights standards in investment governance. The third subtype seeks to confirm or recognise that contracting states have primary obligations to defend human or labour rights (CON). The fourth kind is exceptive (EXP), which exempts contracting governments from taking human rights or labour rights measures that are otherwise inconsistent with their IIA responsibilities.

CONCLUSION

TRLs have been more common in trade and investment treaties in recent years, as transparency of laws and government actions is widely seen as an important component of the rule of law and good governance. TRLs in IIAs are further subdivided into three categories. The first subtype requires contracting governments to publish investment-related laws and regulations (PUB), which is also the conventional and most common type of TRL. Such TRLs are frequently referred to as “transparency” in various IIAs. The second subtype requires contracting states to communicate effectively on their investment-related laws, rules, policies, and practises, particularly when partner states have relevant queries or concerns (COM). The primary goal of such TRLs is to improve contracting states’ understanding of each other’s investment regulatory systems in order to improve investment governance. The third category essentially demands contracting states to allow stakeholders to participate appropriately in the development of an investment-related law or policy (ENG). Typical TRLs allow the public to provide feedback during the legislative or policymaking process.

Author: Kaustubh Kumar, in case of any queries please contact/write back to us via email to chhavi@khuranaandkhurana.com or at  Khurana & Khurana, Advocates and IP Attorney.

[i] Villiger, M. E., 2008. Commentary on the 1969 Convention on the Law of Treaties (The Hague: Martinus Nijhoff), p.44

[ii] Siemens A.G. v. The Argentine Republic (ICSID Case No. ARB/02/8), Decision on Jurisdiction of 3 August 2004, available at http://www.italaw.com/cases/1026, at para.81

[iii] Compañiá de Aguas del Aconquija S.A. and Vivendi Universal v. Argentine Republic (ICSID Case No. ARB/97/3), Award of 20 August 2007, available at http://www.italaw.com/cases/309, at para.7.4.4

[iv] See generally Fitzmaurice, G., 1957. The Law and Procedural of the International Court of Justice 1951-1954.33, British Year Book of International Law 229.