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Venus, Mars, and Brussels: Legitimacy and Dispute Settlement Culture in Investment Law and WTO Law: A Response to Joost Pauwelyn

Published online by Cambridge University Press:  20 January 2017

Robert Howse*
Affiliation:
New York University School of Law
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Late last year, the European Commission unveiled an ambitious and complex proposal to replace investor-state arbitration with a transnational court, including an appellate instance, which has now been incorporated into its new bilateral agreements with Vietnam and Canada (CETA). The Commission was responding to strong public resistance to including investor protections in the Transatlantic Trade and Investment Partnership (TTIP), the trade and investment agreement being negotiated between the European Union and the United States. This resistance reflects a remarkable shift in emphasis from the World Trade Organization (WTO) to the investment regime in what could be called loosely the antineoliberal globalization movement. The overarching concern is that international decision-makers with a neoliberal or procorporate bias will limit the policy space of sovereign states, especially in sensitive areas such as public services, the environment, health, and safety. While it is arguable that few of the actual outcomes in investor-state disputes can properly be understood in this way, the pursuit by Philip Morris of its attack on tobacco regulation through the investment regime has certainly provided a very obvious example for the activists. (The defeat of that challenge on jurisdictional grounds doesn’t really provide assurance about the substantive norms at issue and their consistency with policy space.)

Type
Symposium on Joost Pauwelyn, “The Rule of Law Without the Rule of Lawyers? Why Investment Arbitrators are from Mars, Trade Adjudicators are from Venus”
Copyright
Copyright © American Society of International Law 2015

References

1 Philip Morris Asia Limited v. Commonwealth of Austl., PCA Case No. 2012-12.

2 See for example Pia Eberhardt & Cecilia Olivet, Profiting from Injustice: How law firms, arbitrators and financiers are fueling an investment arbitration boom (2012).

3 Pauwelyn, Joost, The Rule of Law without the Rule of Lawyers? Why Investment Arbitrators are from Mars, Trade Adjudicators from Venus, 109 AJIL 761 (2015)CrossRefGoogle Scholar.

4 Panel Report, United States—Measures Concerning the Importation, Marketing and Sale of Tuna and Tuna Products, WT/DS381/R (Adopted June 13, 2012).

5 Panel Report, Brazil—Measures Affecting Imports of Retreaded Tyres, WT/DS332/R (Adopted Dec. 17, 2007).

6 Panel Report, Canada—Certain Measures Affecting the Renewable Energy Generation Sector, WT/DS412/R (Adopted May 24, 2013).

7 Panel Report, European Communities—Measures Affecting Asbestos and Products Containing Asbestos, WT/DS135/R (Adopted Apr. 5, 2001).

8 Appellate Body Report, European Communities—Measures Concerning Meat and Meat Products (Hormones), WT/DS26/AB/R, WT/DS48/AB/R (Adopted Feb. 13, 1998).

9 Appellate Body Report, United States—Import Prohibition of Certain Shrimp and Shrimp Products, WT/DS58/AB/R (Adopted Nov. 6, 1998).

10 Appellate Body Report, European Communities—Measures Affecting Asbestos and Products Containing Asbestos, WT/DS135/AB/R (Adopted Apr. 5, 2001).

11 Appellate Body Report, European Communities—Conditions for the Granting of Tariff Preferences to Developing Countries, WT/DS246/AB/R (Adopted Apr. 20, 2004).

12 Appellate Body Report, United States—Continued Suspension of Obligations in the EC—Hormones Dispute, WT/DS320/AB/R (Adopted Nov. 14, 2008); Appellate Body Report, Canada—Continued Suspension of Obligations in the EC— Hormones Dispute, WT/DS321/AB/R (Adopted Nov. 14, 2008).

13 Appellate Body Report, European Communities—Measures Prohibiting the Importation and Marketing of Seal Products, WT/DS400/AB/R, WT/DS401/AB/R (Adopted June 18, 2014).

14 Pauwelyn, supra note 3, at 764.

15 Appellate Body Report, European Communities—Measures Concerning Meat and Meat Products (Hormones), WT/DS26/AB/R, WT/DS48/AB/R (Adopted Feb. 13, 1998).

16 Appellate Body Report, United States—Import Prohibition of Certain Shrimp and Shrimp Products, WT/DS58/AB/R (Adopted Nov. 6, 1998).

17 Appellate Body Report, European Communities—Measures Affecting Asbestos and Products Containing Asbestos, WT/DS135/AB/R (Adopted Apr. 5, 2001).

18 Appellate Body Report, European Communities—Conditions for the Granting of Tariff Preferences to Developing Countries, WT/DS246/AB/R (Adopted Apr. 20, 2004).

19 Appellate Body Report, United States—Continued Suspension of Obligations in the EC—Hormones Dispute, WT/DS320/AB/R (Adopted Nov. 14, 2008); Appellate Body Report, Canada—Continued Suspension of Obligations in the EC— Hormones Dispute, WT/DS321/AB/R (Adopted Nov. 14, 2008).

20 Appellate Body Report, European Communities—Measures Prohibiting the Importation and Marketing of Seal Products, WT/DS400/AB/R, WT/DS401/AB/R (Adopted June 18, 2014).

21 Appellate Body Report, United States—Measures Affecting the Production and Sale ofClove Cigarettes, WT/DS406/AB/R (Adopted Apr. 4, 2012).

22 Appellate Body Report, United States—Measures Concerning the Importation, Marketing and Sale ofTuna and Tuna Products, WT/DS381/AB/R (Adopted June 13, 2012).

23 AppellateBodyReport,UnitedStates—CertainCountryof OriginLabelling (COOL)Requirements,WT/DS384/AB/R (Adopted July 23, 2012).

24 Appellate Body Report, Brazil—Measures Affecting Imports of Retreaded Tyres, WT/DS332/AB/R (Adopted Dec. 17, 2007).

25 AppellateBodyReport,Canada—CertainMeasuresAffectingtheRenewableEnergyGeneration Sector, WT/DS412/AB/R (Adopted May 24, 2013).

26 Appellate Body Report, United States—Measures Concerning the Importation, Marketing and Sale ofTuna and Tuna Products, Recourse to Article 21.5 of the DSU by Mexico, WT/DS381/AB/RW (Adopted Dec. 3, 2015).

27 Metalclad v. United Mexican States, ICSID Case No. ARB(AF)/97/1.

28 CMS Gas Transmission Company v. Republic of Arg., ICSID Case No. ARB/01/8.

29 Bilcon of Delaware v. Government ofCan., PCA Case No. 2009-04.

30 I must disclose that I acted as a consultant to the investor’s counsel in that case.

31 Loewen Group v. U.S., ICSID Case No. ARB(AF)/98/3, Award, para. 217 (June 26, 2003), 7 ICSID Rep. 442 (2004).

32 Glamis Gold v. U.S., Award (June 8, 2009), 48 ILM 1038 (2009)

33 See Alison Ross, Freshfields lecture 2011: Saving Investment Arbitration from Itself, Global Arbitration Review (Dec. 6, 2011).