International Investment Obligations and Industrial Policy: Evolution in Treaty Practice
RTA Exchange (International Centre for Trade and Sustainable Development and Inter-American Development Bank), 2018
21 Pages Posted: 3 Jun 2019
Date Written: August 31, 2018
As industrial policies become more widespread and controversial, the relationship between international investment agreements (IIAs) and industrial policy measures has taken on particular importance. This paper addresses this relationship in light of two competing and strengthening influences: heightened scrutiny of industrial policy measures and heightened expectations for sustainable development. Analysing the IIA-industrial policy relationship requires consideration of the regulatory, national security, and strategic aspects of industrial policy measures, and the legal significance of those differences under international investment law. The paper develops a framework for analysing the different aspects of such measures and the legal consequences that flow from those distinctions. It argues that by providing guidance on the relationship between IIA obligations and strategic industrial policy measures — including guidance on how the policy goal of sustainability affects that relationship — policymakers can reduce uncertainty for states agreeing to IIA obligations and for investors considering potential investments abroad.
Keywords: CETA, CPTPP, industrial policy, sustainability, SDGs
JEL Classification: K33
Suggested Citation: Suggested Citation