Abstract

http://ssrn.com/abstract=2157250
 


 



Variations on a Theme: Comparing the Concept of 'Necessity' in International Investment Law and WTO Law


Andrew D. Mitchell


University of Melbourne - Melbourne Law School; NYU School of Law

Caroline Henckels


University of New South Wales (UNSW) - Faculty of Law

October 1, 2012

Chicago Journal of International Law, Forthcoming

Abstract:     
The concept of ‘necessity’ is used in many legal systems to delimit permissible measures from prohibited measures where such measures negatively affect the regime’s primary values, such as human rights, liberalized trade, and unimpeded use of an investment. International investment tribunals have adopted a variety of approaches to the question of whether a host state measure is ‘necessary’ to achieve its objective in relation to a number of provisions of investment treaties, including non-precluded measures clauses and fair and equitable treatment. Yet their approaches to this form of analysis are inconsistent and generally not analytically robust. By comparison, WTO tribunals have developed relatively sophisticated methods for analyzing a measure’s necessity to achieve its objective in the context of general exceptions, sanitary and phytosanitary measures and technical regulations. The WTO approach generally takes into account a number of factors including the importance of a measure’s objective, a measure’s effectiveness at achieving that objective, and the availability of alternative measures. Importantly, WTO tribunals generally undertake this analysis with a degree of deference, in recognition of states’ right to set their own policy priorities. Investment tribunals could usefully employ aspects of the WTO approach to necessity in the context of both non-precluded measures and the positive obligations of fair and equitable treatment, non-discrimination and non-expropriation. Such an approach would go some way toward the development of a consistent, coherent body of cases in relation to the concept of necessity in international investment law, providing greater certainty for both host states and investors.

Number of Pages in PDF File: 58

Keywords: necessity, international law, international investment law, WTO law, non-precluded measures

JEL Classification: K33

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Date posted: October 4, 2012 ; Last revised: February 25, 2013

Suggested Citation

Mitchell, Andrew D. and Henckels, Caroline, Variations on a Theme: Comparing the Concept of 'Necessity' in International Investment Law and WTO Law (October 1, 2012). Chicago Journal of International Law, Forthcoming. Available at SSRN: http://ssrn.com/abstract=2157250

Contact Information

Andrew D. Mitchell (Contact Author)
University of Melbourne - Melbourne Law School ( email )
The University of Melbourne
Victoria, 3010
Australia
+61383441098 (Phone)
+61393472392 (Fax)
HOME PAGE: http://www.law.unimelb.edu.au/staff/Andrew%20Mitchell
NYU School of Law ( email )
185 West Broadway
New York, NY 10013
United States
+1 212 992 6166 (Phone)
Caroline Henckels
University of New South Wales (UNSW) - Faculty of Law ( email )
Kensington, New South Wales 2052
Australia
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