The Protection of Property Rights Under the European Convention on Human Rights and the Promotion of Low-Carbon Investments

Climate Law, Vol. 1, No. 1, pp. 93-102, April 2010

41 Pages Posted: 8 Jul 2010 Last revised: 26 May 2014

See all articles by Anatole Boute

Anatole Boute

The Chinese University of Hong Kong (CUHK) - Faculty of Law

Date Written: September 8, 2009

Abstract

Investors in alternative modes of electricity production that build their business cases on support schemes face the risk that states modify the financial incentives provided by these schemes once investments are made and costs are sunk. Similarly, operators of high-efficiency production installations could, in the context of liberalized electricity markets, be confronted with state interference with the electricity price formation mechanism that could prevent them from recovering the higher investment costs of their state-of-the-art equipment. Investors’ perception that states could act opportunistically by reneging on commitments that constitute the financial basis of their low-carbon investments will generate emission reductions at a higher cost than in a guaranteed stable regulatory environment. This paper analyses the extent to which the right to property in the European Convention on Human Rights could offer adequate protection against such potential opportunistic interference of states. It argues that, although the ECHR does not provide investors with absolute guarantees against such interference, it creates essential procedural safeguards that prevent states from imposing most costs of emission reductions on private investors. These safeguards, in turn, contribute to the increased efficiency of climate change policies.

Keywords: Climate Change Mitigation, Investment Protection, Investment Law, European Convention For Human Rights, Right To Property, Regulatory Risk

Suggested Citation

Boute, Anatole, The Protection of Property Rights Under the European Convention on Human Rights and the Promotion of Low-Carbon Investments (September 8, 2009). Climate Law, Vol. 1, No. 1, pp. 93-102, April 2010, Available at SSRN: https://ssrn.com/abstract=1636344

Anatole Boute (Contact Author)

The Chinese University of Hong Kong (CUHK) - Faculty of Law ( email )

6/F Lee Shau Kee Building
Shatin New Territories
Kowloon, Sha Tin
Hong Kong

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