Investor-State Arbitration and the Public Interest Regulation Theory

Posted: 18 Jun 2014

See all articles by Fola Adeleke

Fola Adeleke

University of the Witwatersrand - School of Law

Date Written: June 16, 2014

Abstract

When South Africa decided late last year to terminate a number of bilateral investment agreements with European Union countries, it did so at a time when global regulatory governance has come under scrutiny for their disposition to the domestic economic policies of states and the idea of state sovereignty in the regulation of its own economic affairs is fast declining. The prevailing global regulatory governance regime institutionalizes neo-liberalism which has given birth to various economic institutions and rules including bilateral investment treaties (BITs). The policy interest behind BITs is to some extent the suspension of domestic regulation in the governance of foreign investment. With this suspension in place, the regulatory sphere is filled by a supra-national regime that is rigid and restrains state conduct. In this paper, I intend to apply the emerging legal framework of global administrative law (GAL) to investor state arbitration in order to dispel the resistance towards this dispute settlement mechanism found in BITs for its perceived inability to adequately handle disputes that deal with public interest issues that fall outside standard investment protection but are relevant to the resolution of the investment dispute. I propose the application of domestic law concepts in an international sphere and make the argument that a statutory interpretation based on administrative law principles anchors the BIT regime to the domestic policy space of states and builds up the much needed legitimacy for investor state arbitration. The focus of GAL on the procedural elements of administrative law enables the implementation of substantive norms of liberalized trade which also promotes the rule of law, encourage a broader range of social and economic actors to scrutinize decision making and promote a democratic element in global regulatory governance. This democratic element includes public participation, greater transparency as well as an interpretive approach founded on GAL principles.

Keywords: Bilateral Investment Treaties (BITs), Global Administrative Law (GAL), Deference, Public Interest, Investment Arbitration

Suggested Citation

Adeleke, Fola, Investor-State Arbitration and the Public Interest Regulation Theory (June 16, 2014). Fourth Biennial Global Conference of the Society of International Economic Law (SIEL) Working Paper No. 2014/12, Available at SSRN: https://ssrn.com/abstract=2451446 or http://dx.doi.org/10.2139/ssrn.2451446

Fola Adeleke (Contact Author)

University of the Witwatersrand - School of Law ( email )

PBag X3, WITS
2050 Johannesburg
South Africa

Here is the Coronavirus
related research on SSRN

Paper statistics

Abstract Views
2,160
PlumX Metrics