Convergence and Divergence in the Investment Treaty Universe – Scoping the Potential for Multilateral Consolidation

Trade, Law & Development, Vol. 8, No.2, 2016, pp. 152-183

Ottawa Faculty of Law Working Paper No. 2017-38

32 Pages Posted: 24 Aug 2017 Last revised: 5 Sep 2017

See all articles by Wolfgang Alschner

Wolfgang Alschner

University of Ottawa - Common Law Section

Dmitriy Skougarevskiy

European University at St. Petersburg

Date Written: August 1, 2016

Abstract

How far are we from a multilateral investment treaty? In this paper we answer this question by empirically assessing convergence and divergence in the pool of existing bilateral investment treaties (BITs) scoping the potential for multilateral consolidation. To do so, we introduce a novel automated coding procedure, which investigates investment treaty content across 1628 English-language BITs and their 22,500 articles. We show that treaties are split into older, short and shallow agreements and newer, deep and complex ones. This creates possibilities for consolidation around a lowest common denominator. A multilateral treaty with the 27 most prevalent features (out of a total of 66 coded features) would already substitute the content of 50% of all BITs and one with the 36 features could replace 80% of agreements. In contrast, consolidating practice around deeper agreements balancing investment protection and State sovereignty explicitly is politically more desirable, but also more ambitious. Only a minority of treaties contain non-investment protection features and their design diverges increasingly as States adopt varying architectures to solve similar policy challenges. As a result, further consolidation at the regional level and partial multilateralizations become necessary stepping-stones, if a future multilateral investment agreement is to converge practice around deeper BITs.

Keywords: Investment Law, Investment Treaties, Convergence, Multilateral, Multilateralization, Consolidation, Text-as-Data, Empirical

Suggested Citation

Alschner, Wolfgang and Skougarevskiy, Dmitriy, Convergence and Divergence in the Investment Treaty Universe – Scoping the Potential for Multilateral Consolidation (August 1, 2016). Trade, Law & Development, Vol. 8, No.2, 2016, pp. 152-183, Ottawa Faculty of Law Working Paper No. 2017-38, Available at SSRN: https://ssrn.com/abstract=3024861

Wolfgang Alschner (Contact Author)

University of Ottawa - Common Law Section ( email )

57 Louis Pasteur Street
Ottawa, K1N 6N5
Canada

Dmitriy Skougarevskiy

European University at St. Petersburg ( email )

6/1A Gagarinskaya Street
St. Petersburg, 191187
Russia

HOME PAGE: http://eusp.org

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