[Jürgen Kurtz is an Associate Professor at the University of Melbourne Law School in Australia.]
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.
For a respectable number of commentators in the field of international investment law, its dispute settlement machinery – which often confers procedural rights on foreign investors as well as states - position the field closer to the private rather than public law end of a spectrum. In his thoughtful new
article, Dr. Stephan Schill comprehensively dismantles this claim by advancing “an understanding of international investment law as an internationalized discipline of public law” (p. 59). There is, of course, an important structural justification for positioning international investment law as an integral part of the public international law universe. Various international regimes similarly accommodate non-state actors as either complainants or respondents in dispute settlement, including both human rights protections and international criminal law. It would be implausible to characterize these systems as carve-outs to public international law, and the investment treaty network is no different. For Schill however, the mechanisms to address the growing disenchantment of states parties towards this regime go beyond the confines of public international law itself. Instead, his “core idea is to tackle problems arising under international investment treaties by means of a comparative public law method, which takes inspiration from the more advanced systems of public law at
both the domestic and international level” (emphasis added, p. 60).
Comparativism is a powerful methodology. It is one of the few laboratories open to lawyers to assess and understand the operation of different legal and institutional models designed to tackle similar objectives and problems. But at least when it comes to investment law, there may be another approach which is logically and strategically a necessary precursor (at least at this particular stage in the evolution of the system). One of the premises underpinning Schill’s argument is that states only “occasionally react to the decision-making of arbitral tribunals by recrafting investment treaties” (p. 81). Schill’s preference then is for “system-internal adaptation” (pp. 68-71) with the lessons drawn from a comparative law analysis seemingly intended for consumption by adjudicators ruling on an assumed stable set of legal norms. My reading of the treaty landscape is very different. I see the network as deeply heterogeneous with states employing complex (but sometimes highly problematic) strategies to recalibrate their treaty obligations. Most fundamentally, there is a distinct shift away from the classic protective BIT model as states parties refine treaty standards by matching them against identifiable political and economic risks faced by foreign investors. This then logically suggests that interdisciplinary analysis should play an earlier role in probing and testing the contemporary justifications for particular investment protections, before advancing select lessons from other legal systems. It would, after all, be imprudent to erect a roof on a house that is built on soft sand.
