Non-Discrimination and the Role of Regulatory Purpose in International Trade and Investment Law

Andrew Mitchell, David Heaton, Caroline Henckels, Non-Discrimination and the Role of Regulatory Purpose in International Trade and Investment Law (Edward Elgar, 2016) (Forthcoming)

Posted: 11 Sep 2015

See all articles by Andrew D. Mitchell

Andrew D. Mitchell

University of Melbourne - Law School

David Heaton

University of Melbourne

Caroline Henckels

Monash University - Faculty of Law

Date Written: September 7, 2015

Abstract

Non-discrimination is central to national treatment and most-favoured national obligations under both World Trade Organization (‘WTO’) and international investment agreements, yet there are significant inconsistencies in the decided cases in both systems on what constitutes like (or sufficiently comparable) products, services, service-providers, investors or investments (‘PSSPII’) and what constitutes less favourable treatment. WTO and international investment tribunals have invoked ‘regulatory purpose’ to assist in identifying relevant discrimination, but have done so without offering a definition of regulatory purpose and in significantly differing ways. This book argues that these inconsistencies are largely explained by the failure of WTO and international investment tribunals to explain the normative basis of their enquiries — that is, to explain, by reference to the object and purpose of the agreement in question, what kind of discrimination is relevant. It offers a working definition of regulatory purpose as the actual and rational, objectively identifiable intended effects of a measure. It surveys and criticises the manner in which the concept has been used to date, arguing that, in relation to ‘likeness’ or ‘like circumstances’, regulatory purpose is at best evidence of differences or similarities between PSSPII and cannot rise any higher. The book argues, in relation to ‘less favourable treatment’, that regulatory purpose (as defined) should always be considered by a WTO or international investment tribunal. It proposes an ‘enhanced’ legitimate regulatory purpose exception as part of the ‘less favourable treatment’ standard under international investment agreements on the basis of treaty text and purpose and argues that in the WTO context, the Appellate Body’s recent jurisprudence under the Technical Barriers to Trade Agreement suggests that it should reconsider the role of regulatory purpose under the GATT, in particular in relation to circumstances not falling within the enumerated paragraphs of Article XX. Throughout, the book compares and contrasts WTO and international investment law, drawing out several parallels and suggesting areas in which one might supply answers to questions arising in the other.

Keywords: Non-discrimination, National Treatment, Most Favoured Nation, World Trade Organization, international investment law, regulatory purpose, likeness, like circumstances

JEL Classification: K33

Suggested Citation

Mitchell, Andrew D. and Heaton, David and Henckels, Caroline, Non-Discrimination and the Role of Regulatory Purpose in International Trade and Investment Law (September 7, 2015). Andrew Mitchell, David Heaton, Caroline Henckels, Non-Discrimination and the Role of Regulatory Purpose in International Trade and Investment Law (Edward Elgar, 2016) (Forthcoming). Available at SSRN: https://ssrn.com/abstract=2657083

Andrew D. Mitchell (Contact Author)

University of Melbourne - Law School ( email )

University Square
185 Pelham Street, Carlton
Victoria, Victoria 3010
Australia
+61383441098 (Phone)
+61393472392 (Fax)

HOME PAGE: http://www.law.unimelb.edu.au/staff/Andrew%20Mitchell

David Heaton

University of Melbourne ( email )

University Square
185 Pelham Street, Carlton
Victoria, Victoria 3010
Australia

Caroline Henckels

Monash University - Faculty of Law ( email )

Wellington Road
Clayton, Victoria 3800
Australia

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