Between Aspirations and Reality: The European Union and International Investment Law Reform

Abstract

International investment law, as a subsystem of international law for the protection of foreign investors, is at a crossroads. Public and political controversies prompted a number of reform processes, most significantly the multilateral reform of Investor-State Dispute Settlement (ISDS) in the framework of the UN Commission on International Trade Law. The EU, as an emerging actor in the field, has proposed the establishment of a new Multilateral Investment Court as part of the ISDS reform in the EU and international law.

This research evaluates the contribution of the EU to the development of international law in the field of investment, and in particular it assesses whether the ISDS reforms of the EU address the international investment law problems and contribute to the achievement of the rule of law and legitimacy as the reform's normative goals. In order to answer this question, this dissertation provides a substantial analysis of EU investment law and policy in the broader context of international investment law and its reform. The investment reform of the EU is the expression of the constitutional aspiration of the EU to promote multilateral solutions to common ISDS problems. In reality, the EU faces a number of challenges, stemming from the external complexities of international investment law and multilateral governance; as well as the internal limitations of the EU's own constitutional and legal framework.

The approach of the EU to the legal regulation of investment is a pragmatic but ambitious long-term strategy for achieving the EU's internal integrationist and external trade objectives. Its vision of international investment law is a trade-off between aspirational EU values and its commercial objectives, with a fragmentary contribution to the international rule of law and the legitimacy of international investment law. The ongoing multilateral reform process remains a test for the EU to establish a new international court at times when both international law and multilateralism face significant challenges. Show more