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The Nature of Investor’s Rights under Investment Treaties: A Rejoinder to Martins Paparinskis

Published on October 31, 2013        Author: 

Editor’s note: This is the final installment in the discussion begun last week of Martins Paparinskis’s EJIL article, “Investment Treaty Arbitration and the (New) Law of State Responsibility“.

Martins’ reply to my comments on his EJIL article highlights a number of challenging issues regarding the ongoing debate over the direct or derivative nature of investors’ rights under international investment agreements (IIAs). To summarize our disagreement: Martins, on the one hand, views the derivative rights approach “as only one of a number of plausible ways of articulating international law arguments about investment law”; on the other, I remain strongly reluctant towards this polyphony of plausible  articulations, and rather find that the direct rights model is unconvincing.

Martins questions, first, whether the practice of NAFTA Parties indeed favours the derivative model; second, whether international law provides for causality (or even correlation) between the nature of obligations under treaties and the nature of rights derived thereunder; and, third, whether indeed the HICEE v Slovakia award explicitly adopts the derivative rights model. By way of rejoinder to Martins’ reply, I will address the first point separately, and the second and third points jointly. Read the rest of this entry…

 
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The Nature of Investor’s Rights under Investment Treaties: A Comment on Paparinskis’ “Investment Treaty Arbitration and the (New) Law of State Responsibility”

Published on October 22, 2013        Author: 

Gourgourinis_photoDr Anastasios Gourgourinis is Lecturer in Public International Law at the National and Kapodistrian University of Athens Faculty of Law, and Research Fellow at the Academy of Athens.

Martins Paparinskis’ EJIL Article argues that the conceptual challenges faced by contemporary investment treaty arbitration can be effectively addressed if the regime is not viewed in isolation from its progeny, i.e. international human rights and consular law, the law of treaties and the law of diplomatic protection. The discussion in Paparinskis’ piece is essentially centred on the debate regarding the character and nature of investors’ rights under international investment agreements (IIAs), i.e. either as direct or derivative rights. Paparinskis address the nature of investors’ rights under IIAs from the terminologically different, but contextually similar, lens of the models of direct rights, beneficiary rights, and agency. He explicitly declines to take a firm position regarding which of these models is the most plausible one, but he appears, at least in my eyes, more prone to side with the direct rights model, especially in view of the analogies with human rights law (see also his analysis here). This is where we will have to part ways, and in this post I take issue with this, largely drawing from my chapter on the direct/derivative rights debate.

Below, I take issue with the idea that an investor may be considered as a holder of direct rights akin to human rights. Although Paparinskis does a tremendous job in drawing normative parallels between the two regimes, I remain of the  view that the very different nature of obligations derived from human rights instruments and IIAs cautions against such an approach, and rather supports the derivative model of investors’ rights. The debate over the direct or derivative nature of investors’ rights received full treatment in the seminal BYBIL article by Zachary Douglas and evidence that it is  ongoing and growing, is manifested by the fact that during the recent 2013 ILA Regional Conference in Sounion, Greece, three papers touching upon these and similar issues were presented (see here, here and here). Read the rest of this entry…

 
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