The Future We Want: Sustainable Development as an Inherent Aim of Foreign Investment Protection

Abstract

It is now acknowledged that sustainable development is a new paradigm of international investment protection law, to be taken into account when planning domestic investment policies and drafting future investment agreements.

Yet, the paper intends to provide a re-contextualization of the currently existing investment regime in a way that already allows focusing on the protection of wider interests than the ones of pure economic value in the application of investment law.

In order to do that, the paper consists of two parts. First, it analyses the term economic development as the object and purpose of the currently existing international investment regime, suggesting that economic development is a generic term whose current meaning requires to put it in the context of sustainable development. Sustainable development essentially means the achievement of an equitable balance between economic development, social development and environmental protection. Consequently, sustainable development - as the object and purpose of investment protection law - requires finding a balance between the State’s regulatory responsibilities and a foreign investor’s interests.

Second, the paper suggests that in order to find that balance, sustainable development - as the inherent objective of investment protection - may alter perceptions of applicable law and guide the contextual and effective interpretation of investment protection standards by requiring a focus on wider interests than merely those of foreign investors. As a result, it may influence the methodologies used for the establishment of violations of investment guarantees.

Keywords: sustainable development, investor-State arbitration, foreign investment protection law, object and purpose, treaty interpretation