Reform and Retrenchment in International Investment Law

Abstract

These Keynote Remarks were prepared for the Santander Roundtable Discussions on International Economic Law, co-hosted by Kenyatta University School of Law, (Nairobi); Riara Law School, (Nairobi); and the International Investment Law Center, at University of Cologne, January 13, 2021. The main claim is that the ISDS-centric focus of the current UNCITRAL Working Group III and ICSID Rule processes do not deal with some of the most fundamental challenges international investment law poses. These challenges are: How rights conferred on investors by international investment law effectively undermine domestic regulatory choices; How international investment law creates an asymmetrical private system of justice in which only investors have rights, whereas States are duty-bearers with no rights; How ISDS cases, and even the threat of investors bringing ISDS claims, creates a regulatory chilling effect; and how reform processes overlook market failures arising from the incentive structure of the international investment law system, allowing investors to externalize massive environmental, human rights and other costs. Perhaps therefore, the ISDS centric nature of the reforms raises the possibility that this reform process has the hallmarks of the most organized constituencies that benefit from its continuation.