Abstract
<p>The global investment regime is a prime example of the so-called ‘politicization beyond the state.’ Investment agreements with an Investor–State Dispute Settlement (ISDS) mechanism have become contested in several corners of the globe, triggering a widespread reform process encompassing national, regional and multilateral levels. This article examines the consequences of this confluence of politicization processes, focusing on the European Union (EU) and two key venues of ISDS reform: the United Nations Commission on International Trade Law (UNCITRAL) and the Energy Charter Treaty (ECT). Combining different strands of politicization literature in International Relations and Political Science, the article advances a nuanced conceptualisation of the institutional consequences of politicization that goes beyond a deepening/decline dichotomy. Instead, the article examines whether and how politicization generates ‘authority shifts,’ either through a vertical move between international and national levels; and/or through a horizontal recalibration between public and private forms of governance. The article argues that although the EU’s initiative for global ISDS reform intended to rebalance public and private authority while strengthening its international character, the on-going reform processes at the UNCITRAL and the ECT may eventually lead to a (partial) dismantling of international authority.</p>
Highlights
Foreign investment is typically considered a key driver of economic growth, job creation, development and lasting peace
With a focus on ‘authority shifts’ in inter-linked arenas of Investor–State Dispute Settlement (ISDS) reform this article has sought to contribute to politicization literature in three ways
The picture that emerges from the analysis of authority shifts is a nuanced one, showing that while most states agree on the need for reforming investor–state arbitration, there are still competing options of authority recalibration
Summary
Foreign investment is typically considered a key driver of economic growth, job creation, development and lasting peace. While taking these approaches as a point of departure, this article suggests a more nuanced way to assess the consequences of politicization, focusing on whether it leads to actual ‘authority shifts.’ To that aim, it brings different strands of politicization literature in International Relations and Political Science closer together, by examining whether widespread societal contestation of international institutions leads to a vertical displacement of authority between international and national levels; and/or a horizontal recalibration between public and private forms of governance. It is argued here that such a conceptualisation can offer a more finegrained diagnosis of global governance changes without prejudging their normative implications This conceptualisation of the consequences of politicization is applied to the study of three crucial venues of ISDS reform: the EU—the world’s largest source of foreign investment; the United Nations Commission on International Trade Law (UNCITRAL)—the UN body providing one of the most widely applied arbitral rules; and the Energy Charter Treaty (ECT)—the world’s most litigated international treaty. The last section concludes, summarizing the findings and discussing the implications of the politicization of ISDS for the future shape of investment governance and beyond
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a call
