Handbook

Investment treaties are among the most powerful and controversial instruments of international economic governance. They grant foreign investors broad protections from interference by the governments of the countries in which they invest. They also establish an international mechanism for adjudication and enforcement, allowing foreign investors to bypass national courts and, instead, bring cases against states directly to international arbitration. The amount at stake in these disputes regularly runs into billions of dollars. Philip Morris’ recent case against Australia arising from Australia’s tobacco plain packaging legislation is a high profile example. Supporters argue that investment treaties promote foreign investment and respect for the rule of law in countries that are bound by them. Critics argue that investment treaties constitute a ‘bill of rights for multinational corporations’ that is enforced through ‘secret courts’.

This course provides an introduction to the law and policy of the investment treaty regime. The course covers the network of almost 3000 bilateral investment treaties, along with the investment chapters of multi-issue free trade agreements, such as NAFTA and the proposed Trans-Pacific Partnership. It also covers international dispute settlement through investment treaty arbitration under the ICSID and UNCITRAL Rules.

Main topics

• The range of foreign investors and foreign investments covered by investment treaties;
• Key substantive protections contained in investment treaties, such as guarantees of ‘fair and equitable treatment’, non-discriminatory treatment and compensation for expropriation;
• Rules and procedures governing investment treaty arbitration;
• International enforcement of arbitral awards.

All topics are illustrated with practical examples drawn from the 700 known investment treaty arbitrations conducted to date.

The course also encourages students to engage with the central policy debates relating to the investment treaty regime, including:

• whether governments fully understood the implications of investment treaties when they signed them;
• whether investment treaties deliver economic benefits promised by their proponents;
• how the goal of protecting foreign investment should be balanced with governments’ need to regulate in the public interest;
• how investment treaties relate to other regimes of investment governance, such as investor-state contracts, national law and investment insurance.

The course is relevant to:

• students considering a career in international dispute settlement, whether in private practice or as a government lawyer;
• students seeking to understand the interaction between national and international legal regimes governing international economic activity;
• students interested in wider debates about globalisation and the regulation of the international economy.