Multinational Enterprises and the Global Investment Regime: Toward Balancing Rights and Responsibilities

Abstract

The question of balancing rights and responsibilities of MNEs and host states is of cardinal importance for the legitimacy and stability of the international investment regime. Many of the shortcomings of the regime are the result of its expansion during a period when the focus was almost exclusively on the responsibility of host countries, as well as the speed with which the regime developed over the past 30 years or so. The rebalancing that is underway, and the various improvements that are being discussed, will help to rectify this situation, and hence need to be pursued vigorously. This chapter takes stock of where we stand in the evolution of the investment regime. It also shows that finding the proper balance regarding the rights and responsibilities of all stakeholders in the international investment regime is an ongoing struggle. Particularly now, the regime is very much in flux, given the various changes in the international economy: we are in the middle of a dynamic process in which key actors are reassessing their interest situations and objectives, including in the light of changing attitudes vis-a-vis FDI and changing expectations regarding the role of the regime. In the end, we might well have to transcend the combination of international investment agreements, customary international law, judicial decisions, authoritative statements, and voluntary rules that make up the international investment law and policy regime today and move toward a binding Multilateral Framework for Investment that comprehensively accommodates the rights and responsibilities of the various stakeholders in a manner that provides legitimacy to the entire regime.