International Trade Law Commons^™

Investment Promotion And Facilitation For Sustainable Development, Brooke Guven

Columbia Center on Sustainable Investment Staff Publications

Investment is a critical component of sustainable development. In particular, under the right conditions, foreign direct investment (FDI) can improve economic growth and living standards, create jobs, transfer technology and know-how and result in supply chain upgrading. However, its benefits are not automatic, and, if not carefully governed, investment can result in harm to the environment, labour standards and lead to tax evasion or other undesirable outcomes. Investment promotion and investment facilitation, in turn, can help states attract, expand and retain FDI.

Comment On Us Trade And Investment Agreements Submitted To Ustr, Columbia Center On Sustainable Investment

Columbia Center on Sustainable Investment Staff Publications

Comments to USTR Re: U.S.-Kenya Trade Agreement (April 28, 2020): CCSI, in response to the United States Trade Representative’s request for public comment to inform its approach to a U.S.-Kenya Trade Agreement, submitted Comments elaborating on our main points that (1) investor-state dispute settlement should not be included in any U.S.-Kenya agreement and (2) principles that should guide an investment chapter or investment provisions in any such agreement should (a) strategically support cross-border investment that produces positive development outcomes for the U.S. and Kenya, (b) facilitate and support good governance of investment projects, and (c) enhance cooperation to solve challenges …

Anticipating Venezuela's Debt Crisis: Hidden Holdouts And The Problem Of Pricing Collective Action Clauses, Robert E. Scott, Stephen J. Choi, Mitu Gulati

Faculty Scholarship

A creditor who asks for stronger enforcement rights upon its debtor’s default will rationally accept a lower interest rate reflecting the greater expected recovery the exercise of those rights provides. Over a dozen studies, however, have failed to document this basic relationship in the context of the collective action clause, a key provision in sovereign bonds. We conjecture that this failure is because enforcing the rights in question requires collective decision-making among anonymous creditors with different interests, impeding market predictions regarding future price effects. The pricing of rights that require collective enforcement thus turns on whether the market observes an …

Preventing The Bad From Getting Worse: The End Of The World (Trade Organization) As We Know It?, Bernard Hoekman, Petros C. Mavroidis

Faculty Scholarship

Recent survey evidence and proposals made in long-running negotiations to improve WTO dispute settlement procedures illustrate that many stakeholders believe the system needs improvement. The Appellate Body crisis could have been avoided but for the use of consensus as WTO working practice. Resolving the crisis should prove possible because the matter mostly concerns a small number of more powerful WTO members. We make several proposals to revitalize the WTO appellate function but argue that unless the WTO becomes a locus for new rulemaking, re-establishing the appellate function will not prevent a steady decline in the salience of the organization. A …

The Paradox Of Contracting In Markets, Robert E. Scott

Faculty Scholarship

Traditional economic analysis distinguishes economic organization along three dimensions: firm, contract, and market. This categorization is misleading in any number of respects, but none more so than the assumption that contract and market are separate modes of exchange. In fact, other than barter, which is almost unknown in contemporary commercial transactions, every market transaction is implemented by contract. Thus, in markets the two modes of exchange are inextricably combined. Moreover, the vast majority of contract activity occurs in some form of market, so it does not require much loss of generalization to say that not only are contracts in all …

Insulating A Wto Investment Facilitation Framework From Isds, George A. Bermann, N. Jansen Calamita, Manjiao Chi, Karl P. Sauvant

Faculty Scholarship

The authors identify several ways in which a WTO investment facilitation framework for development can be insulated from investor-state dispute settlement provisions in international investment agreements, and suggest specific formulations in this respect.

Stakeholder Preferences And Priorities For The Next Wto Director General, Matteo Fiorini, Bernard Hoekman, Petros C. Mavroidis, Douglas Nelson, Robert Wolfe

Faculty Scholarship

The WTO is looking for a new Director-General (DG). What does the trade community think is needed? This paper reports on the results of an expert survey undertaken as part of a research project on global trade governance at the European University Institute to solicit views on what WTO members and the international trade community consider the most important attributes of candidates for the position, as well as views on the substantive policy and institutional reform priorities confronting the WTO – and thus the new DG. The results suggest strong support for someone with managerial and political experience, and a …

To Ab Or Not To Ab?: Dispute Settlement In Wto Reform, Bernard M. Hoekman, Petros C. Mavroidis

Faculty Scholarship

Recent debates on the operation of the WTO’s dispute resolution mechanism have focused primarily on the Appellate Body (AB). We argue that this neglects the first-order issue confronting the rules-based trading system: sustaining the principle of de-politicized conflict resolution that is reflected in the negative consensus rule for adoption of dispute settlement findings. Improving the quality of the work of panels by appointing a roster of full-time professional adjudicators, complemented by reforms to WTO working practices that reduce incentives to resort to formal dispute settlement, can resolve the main issues that led to the AB crisis. Effective, coherent, and consistent …

Making Sense Of The Arbitrator’S Ruling In Ds 316 Ec And Certain Member States – Measures Affecting Trade In Large Civil Aircraft (Article 22.6-Ec): A Jigsaw Puzzle With (At Least) A Couple Missing Pieces, Petros C. Mavroidis, Kamal Saggi

Faculty Scholarship

“The U.S. won a $7.5 Billion award from the World Trade Organization against the European Union, who has for many years treated the USA very badly on Trade due to Tariffs, Trade Barriers, and more. This case going on for years, a nice victory”, tweeted President Trump’s on October 3, 2019. The United States (US) won not only the highest amount of retaliation ever adjudicated in the history of the WTO but also an ongoing right to retaliate on an annual basis until such time as the EU had complied by either removing the subsidies it granted Airbus or somehow …

Wto Dispute Settlement And The Appellate Body Crisis: Insider Perceptions And Members’ Revealed Preferences, Matteo Fiorini, Bernard M. Hoekman, Petros C. Mavroidis, Maarja Saluste, Robert Wolfe

Faculty Scholarship

The WTO dispute settlement system is in crisis, following the decision of the United States to block new appointments to the Appellate Body (AB). The AB went into hibernation in December 2019, not having enough sitting members to be able to operate. What do WTO members think of the performance of WTO dispute settlement? How much do WTO members care about the existence and operation of an appeals mechanism? In this article, we report on the results of a survey of WTO Members’ perceptions of the AB and the role it plays (should play). We complement this with data on …

Inconsistency's Many Forms In Investor-State Dispute Settlement And Implications For Reform, Lise Johnson, Lisa E. Sachs

Columbia Center on Sustainable Investment Staff Publications

Attracting investment in agriculture has been a key policy goal of governments in the global south. Development partners have supported these policies. But what do governments hope to achieve by attracting investment in the agricultural sector? Why are companies interested in investing? What is in it for local communities? And what is the role of lawyers? This primer provides an introduction to some of the key issues that arise in the negotiation of contracts linked to investments in agriculture, and practical guidance for how to approach common issues. Section 1 of this primer outlines the typical goals of three important …

Uncitral Working Group Iii On Isds Reform: How Cross-Cutting Issues Reshape Reform Options, Lorenzo Cotula, Thierry Berger, Lise Johnson, Brooke Güven, Jesse Coleman

Columbia Center on Sustainable Investment Staff Publications

The United Nations Commission on International Trade Law (UNCITRAL) is currently working on how to reform international investment treaties, focusing in particular on those treaties’ provisions enabling investors to sue governments in international arbitration. As an observer organization in this process, CCSI has emphasized that in the context of investor-state dispute settlement (ISDS) reform, it is important to first consider what it is that investment treaties aim to achieve, and only then to consider what form(s) of dispute settlement will best advance those objectives. This means not only looking at reform of the existing ISDS mechanism, but also alternatives to …

Draft Text Providing For Transparency And Prohibiting Certain Forms Of Third-Party Funding In Investor–State Dispute Settlement, Brooke Güven, Lise Johnson, Nathalie Bernasconi-Osterwalder, Lorenzo Cotula, Jane Kelsey

Columbia Center on Sustainable Investment Staff Publications

The United Nations Commission on International Trade Law (UNCITRAL) is currently working on how to reform international investment treaties, focusing in particular on those treaties’ provisions enabling investors to sue governments in international arbitration. As an observer organization in this process, CCSI has emphasized that in the context of investor-state dispute settlement (ISDS) reform, it is important to first consider what it is that investment treaties aim to achieve, and only then to consider what form(s) of dispute settlement will best advance those objectives. This means not only looking at reform of the existing ISDS mechanism, but also alternatives to …

Third-Party Rights In Investor-State Dispute Settlement: Options For Reform, Jesse Coleman, Lise Johnson, Brooke Güven, Lorenzo Cotula, Thierry Berger

Columbia Center on Sustainable Investment Staff Publications

The United Nations Commission on International Trade Law (UNCITRAL) is currently working on how to reform international investment treaties, focusing in particular on those treaties’ provisions enabling investors to sue governments in international arbitration. As an observer organization in this process, CCSI has emphasized that in the context of investor-state dispute settlement (ISDS) reform, it is important to first consider what it is that investment treaties aim to achieve, and only then to consider what form(s) of dispute settlement will best advance those objectives. This means not only looking at reform of the existing ISDS mechanism, but also alternatives to …

Draft Treaty Language: Withdrawal Of Consent To Arbitrate And Termination Of International Investment Agreements, Brooke Güven, Lise Johnson

Columbia Center on Sustainable Investment Staff Publications

The United Nations Commission on International Trade Law (UNCITRAL) is currently working on how to reform international investment treaties, focusing in particular on those treaties’ provisions enabling investors to sue governments in international arbitration. As an observer organization in this process, CCSI has emphasized that in the context of investor-state dispute settlement (ISDS) reform, it is important to first consider what it is that investment treaties aim to achieve, and only then to consider what form(s) of dispute settlement will best advance those objectives. This means not only looking at reform of the existing ISDS mechanism, but also alternatives to …

Human Rights Law And The Investment Treaty Regime, Jesse Coleman, Kaitlin Y. Cordes, Lise Johnson

Columbia Center on Sustainable Investment Staff Publications

In its current form, the international investment treaty regime may stymie the business and human rights agenda in various ways. The regime may incentivize governments to favour the protection of investors over the protection of human rights. Investment treaty standards enforced through investor-state arbitration risk adversely affecting access to justice for project-affected rights holders. More broadly, the regime contributes to a system of global economic governance that elevates and rewards investors’ actions and expectations, irrespective of whether they have adhered to their responsibilities to respect human rights. Without comprehensive reform, investment treaties and investor-state arbitration will continue to interfere with …

Ccsi Submits Written Views To Us Department Of State Regarding Uncitral’S Working Group Iii, Columbia Center On Sustainable Investment

Columbia Center on Sustainable Investment Staff Publications

In connection with the US Department of State’s Annual Advisory Committee on Private International law meeting in May 2019, CCSI submitted written views regarding UNCITRAL’s Working Group III on ISDS reform. CCSI’s comments highlighted specific areas of CCSI’s research as it relates to the US Government and its work within the Working Group. Specifically, US investment treaty negotiating objectives specify that covered foreign investors in the United States should not be accorded greater substantive rights than domestic investors. CCSI highlights the ways in which greater procedural rights afforded under investment treaties to foreign investors in practice result in greater substantive …

The Legitimacy Of Economic Sanctions As Countermeasures For Wrongful Acts, Lori Fisler Damrosch

Faculty Scholarship

This essay offers an installment of what would have been a continuing conversation with David D. Caron, a close colleague in the field of international law, on themes that engaged both of us across multiple phases of our intersecting careers. The issues are fundamental ones for both the theory and the practice of international law, involving such core concerns as how international law can be enforced in an international system that is not yet adequately equipped with institutions to determine the existence and consequences of violations or to impose sanctions against violators; and how to ensure that self-help enforcement measures …

Competition Enforcement, Trade And Global Governance: A Few Comments, Petros C. Mavroidis, Damien J. Neven

Faculty Scholarship

The debate on international antitrust has come from two perspectives. On the one hand, the trade community has emphasised the interface between trade policy and competition (policy and) enforcement. This interface, which was recognised from the outset of multilateral efforts to liberalise trade in what would become the GATT and eventually the WTO, focuses on the prospect that trade liberalisation through border instruments should not be undone by restrictive business practices (RBPs), placing a particular responsibility in this respect on competition enforcement. On the other hand, the antitrust community has emphasised the risk of inefficient enforcement when several jurisdictions can …

Sovereignty And Complex Interdependence: Some Surprising Indications Of Their Compatibility, Charles F. Sabel

Faculty Scholarship

Even as democratic sovereignty and globalization are increasingly seen as incompatible in theory, this chapter argues that, in some important realms, they are proving compatible in practice. As tariffs have fallen to negligible levels, trade agreements among rich countries have come to focus on reconciling regulatory differences. In many sectors, novel forms of cooperation have emerged that allow trade partners deliberately to investigate and learn from one another’s practices, eventually recognizing the equivalence of regimes that are not strictly identical — and in the process extending domestic political oversight to relations among states while often heightening domestic accountability. The emergent …

Twin Crises In The Wto, And No Obvious Way Out, Bernard M. Hoekman, Petros C. Mavroidis

Faculty Scholarship

Pause for a moment. Assume that, by magic wand, the Trump Administration changes its attitude, and agrees to new appointments to the Appellate Body (AB). Have the WTO problems disappeared simply because a complete AB is now in place? Even if matters such as Rule 15 are addressed,1 the distinction between facts and law is clarified and a resolution is found to concerns regarding the AB overstepping of its mandate, we are left with the fact that new trade agreements are being routinely negotiated outside the confines of the WTO, leading enforcement to migrate elsewhere. Is the AB crisis simply …

Greening The Wto: Ega, Tariff Concessions And Policy Likeness, Petros C. Mavroidis, Damien J. Neven

Faculty Scholarship

This paper considers the APEC and EGA agreements which grant tariff concession through HS classifications beyond the six digit level ("ex outs") in favour of "green" goods and discuss how these initiatives fit into the WTO legal regime. Even if the practical significance of the APEC agreement should not be overestimated as it involves modest tariff concessions over a subset of goods which are not heavily traded, these agreements involve a paradigm shift to the extent that they use tariffs concessions negotiated on a plurilateral basis as a policy instrument to meet public policy concern, instead of making market access …

Open Plurilateral Agreements, International Regulatory Cooperation And The Wto, Charles F. Sabel, Bernard Hoekman

Faculty Scholarship

Sustained high growth in many developing countries (‘the rise of the rest’) combined with long-standing WTO working practices hampers the ability of the WTO to perform its routine functions and paralyzes efforts to adapt to new circumstances. Preferential trade agreements have taken up some of the slack in addressing differences in domestic regulation of product safety, environmental and social conditions, but are exclusionary and inefficient from a global perspective. In this paper, we argue that a new type of agreement based on open plurilateral cooperation offers better prospects for groups of countries to explore and develop their potential common interests …

Burning Down The House? The Appellate Body In The Centre Of The Wto Crisis, Bernard Hoekman, Petros C. Mavroidis

Faculty Scholarship

In December 2019 the WTO Appellate Body (AB) will cease to operate unless the United States stops blocking new appointments. The US argues the AB has exceeded its mandate and has indicated it wants to ensure that the AB performs the role originally assigned to it in 1995. This paper discusses the Uruguay round negotiating history with the view to establish what “going back to 1995” entails. It concludes that this should not be difficult assuming a willingness of the WTO membership to seriously consider the US concerns and acceptance by the US of a commitment by the membership to …

Trade Openness And Antitrust Law, Anu Bradford, Adam S. Chilton

Faculty Scholarship

Openness to international trade and adoption of antitrust laws can both curb anti-competitive behavior. But scholars have long debated the relationship between the two. Some argue that greater trade openness makes antitrust unnecessary, while others contend that antitrust laws are still needed to realize the benefits of trade liberalization. Data limitations have made this debate largely theoretical to date. We study the relationship between trade and antitrust empirically using new data on antitrust laws and enforcement activities. We find that trade openness and stringency of antitrust laws are positively correlated from 1950 to 2010 overall, but the positive correlation disappears …

Outcome Report Of Roundtable On International Investment Regime And Access To Justice, Michelle Chan, Kanika Gupta, Jesse Coleman, Kaitlin Y. Cordes, Lise Johnson

Columbia Center on Sustainable Investment Staff Publications

On October 18, 2017, the UN Working Group on Business and Human Rights and the CCSI co-hosted a one-day roundtable on the impacts of the international investment regime on access to justice for investment-affected individuals and communities.

Held at Columbia University in New York, the roundtable brought together 32 individuals from civil society organizations, communities affected by investments at the heart of investor-state claims, governments, academia, donor organizations, UN mandate holders, and other stakeholder groups. The roundtable provided an opportunity for participants to: (i) explore and assess the specific impacts of international investment agreements and investor-state dispute settlement on access …

Rethinking International Investment Governance: Principles For The 21st Century, Emma Aisbett, Barnali Choudhury, Olivier De Schutter, Frank Garcia, James Harrison, Song Hong, Lise Johnson, Mouhamadou Kane, Santiago Peña, Matthew Porterfield, Susan Sell, Stephen E. Shay, Louis T. Wells

Columbia Center on Sustainable Investment Books

Rethinking International Investment Governance: Principles for the 21st Century – written over the course of a week by a distinguished group of experts in international economic governance using the Booksprint process – aims to serve as a practical resource for those interested in the elements of an international investment system that promotes sustainable development and achieves legitimacy by providing benefits to all stakeholders.

The objective of Rethinking International Investment Governance is to change the terms of the debate so that societal values and goals are at the center of discussions about each reform proposal and process. This book rethinks international …

Die Another Day: Zeroing In On Targeted Dumping: Did The Ab Hit The Mark In Us – Washing Machines?, Petros C. Mavroidis, Thomas J. Prusa

Faculty Scholarship

In US – Washing Machines, the WTO Appellate Body (AB) extended the prohibition of zeroing to the so-called exceptional (or W-T) methodology, where the dumping margin is established by comparing the weighted average normal value to export price of specific transactions. Given that the exceptional method was the only method under which the AB had not definitively rejected zeroing, this dispute may have hammered the last nail in the coffin of zeroing. Or, maybe not. The AB did not address a key issue, namely, what is the evidentiary standard that an investigating authority must meet in order to have …

Things Have Changed (Or Have They?): Tariff Protection And Environmental Concerns In The Wto, Petros C. Mavroidis, Damien J. Neven

Faculty Scholarship

This paper considers the APEC and proposed EGA agreements which grant tariff concession in favor of "green" goods. We find that the practical significance of the APEC agreement should not be overestimated as it involves modest tariff concessions over a subset of goods which are not heavily traded. Still, these agreements involve a paradigm shift to the extent that they use tariffs concessions negotiated on a plurilateral basis as a policy instrument to meet public policy concern, instead of making market access conditional on meeting national regulations. We model the mechanism through which these tariff preferences provide incentives to change …

Last Mile For Tuna (To A Safe Harbor): What Is The Tbt Agreement All About?, Petros C. Mavroidis

Faculty Scholarship

The WTO Agreement on TBT (Technical Barriers to Trade) aims at taming NTBs (nontariff barriers), the main instrument segmenting markets nowadays. Some of the terms used to flesh out the commitments undertaken are borrowed from the GATT, and some originate in the modern regulatory reality as expressed through SDOs (standard-development organizations). It does not share a copy-cat function with the GATT, though. Alas, the WTO Appellate Body, by understanding words as ‘invariances’, e.g., interpreting them out of context (without asking what is the purpose for the TBT?), has not only exported its GATT case law, but also misapplied it into …