VJIL Symposium: Questions about the Public Law Approach to International Investment Law

by Anthea Roberts

[Anthea Roberts is currently the Visiting Professor of Law and John Harvey Gregory Lecturer on World Organization at Harvard Law School. She also holds the position of Lecturer in Law, Department of Law, London School of Economics and Political Science.]

This post is part of the Virginia Journal of International Law Symposium, Volume 52, Issues 1 and 2. Other posts in this series can be found in the related posts below.

Thank you very much to Opinio Juris for hosting this discussion and to the Virginia Journal of International Law for inviting me to participate.

Investment treaty arbitration has typically been viewed as a field that marries public international law (as a matter of substance) with international commercial arbitration (as a matter of procedure). During the 2000s, however, a number of authors – including Gus Van Harten (2007), David Schneiderman (2008), Santiago Montt (2009) and Stephen Schill (2010) – have argued that investment treaty arbitration should be reconceptualized as a form of public law because it performs a function that is akin to international judicial review.

Public law approaches have played a key role in legitimacy critiques of the investment treaty system. Some authors, such as Van Harten and Schneiderman, have used the public law approach to argue for the system to be fundamentally overhauled by, for instance, proposing that ad hoc investment tribunals be replaced with a standing investment court. Others authors, such as Montt and Schill, argue that many of the legitimacy critiques leveled against investment treaty arbitration could be countered by an expansion of public law thinking within the existing structure of investment treaty arbitration.

In thinking about these public law approaches, some questions continually recur in my mind. I am grateful for this opportunity to pose some of them to Schill:

* What motivates some scholars to use the public law approach to suggest fundamentally revising the system and others to suggest refining the system from within? If most investment arbitrations continue to be heard by arbitrators with a primary background in public international law or international commercial arbitration, how effective can we expect the public law approach to be in revamping the system from the inside? Can some public law changes be affected only by a radical revision of the system? If so, what are the limits of Schill’s more moderate approach?

* Public law principles often seem to be drawn from North American and Western European states, such as the USA, Canada, England, Germany and France. To what extent does the public law approach assume that the respondent state is robustly democratic? How do principles like deference and standards of review apply when dealing with non-democratic states? Could this result in a two-tiered approach with considerable deference being granted to established democracies and little deference being granted to non-democracies? If so, would this reinforce some of the North-South critiques that have plagued investment protection in the past?

* The public law approach typically focuses on investment treaty arbitration. But many cases involve a combination of investment treaty protections and contractual protections. To what extent does the public law approach apply in cases that turn solely or partly on investor-state contracts? Can states limit the public law approach by entering into provisions like stabilization clauses in investor-state contracts? If so, will the rise of public law approaches in investment treaty arbitration lead to a rise in companies seeking investor-state contracts in order to avoid the application of public law principles to their cases?

* Should a clearer distinction be drawn between domestic public law (administrative and constitutional law) and international public law (such as case law from the European Court of Justice, the European Court of Human Rights and the World Trade Organization’s Appellate Body)? The ECHR gives individuals substantive and procedural rights while the WTO does not, which affects the approach of these systems to issues like the availability of inter-state countermeasures. And concepts such as deference to the legislature can differ radically in domestic systems with legislative supremacy and constitutional supremacy. If differences exist within and between domestic and international public law, will Schill’s comparative public law approach simply give arbitrators license to pick and choose principles they like?

http://opiniojuris.org/2012/04/10/vjil-symposium-questions-about-the-public-law-approach-to-international-investment-law/

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