Introduction

An increasing number of international investment treaties include non-regression clauses in their provisions. Addressed to the host state, those clauses essentially prevent it from pushing back on its commitments to ensure minimum safeguards to certain non-economic interests (such as the protection of the environment). Practically, these treaty mechanisms prohibit the host state from relaxing different forms of protection (legislative, regulatory, or administrative) of a covered non-economic interest in order to attract foreign investment.

While not new, conceptually, non-regression clauses have seen a surge in their inclusion in modern-day international investment agreements. They also form part of a wider (substantive) movement looking to (re)balance the structure of international investment instruments. Seen in their broader context, non-regression clauses could lead to the identification of an interesting pattern - a move away from an investment treaty paradigm geared exclusively (or mostly) towards investor protection to something seeking to actively strike a balance between investor and non-investment interests.

Underlying non-regression clauses is perhaps an unexpected push towards not only safeguarding non-economic interests through exceptions (as would be the case, for example, with treaty clauses reinforcing a state’s right to regulate or to act in a way that safeguards its national security interests ) but towards establishing a minimum baseline for the protection of those non-economic interests. Moreover, when zooming in on climate change concerns, one can clearly identify the leveraging of investment treaties for the protection of international community and of its fundamental interests, or the common heritage of humanity (it is the host states themselves that face an obligation when it comes to these non-regression clauses), with the protection of the environment (and climate change action) used as a case-study throughout the article.

Conceptually, the move towards setting a minimum baseline for the protection of non-economic interests through non-regression clauses identifies a regulatory paradigm slowly developing in the structure and conceptual characteristics of investment treaties. A prohibition addressed to host states from compromising the protection offered to non-economic interests; the establishment of a minimum standard of protection (albeit relative) for those non-economic interests and its specificity; the particularly managerial approach in the design of this type of rules (which would also normally be enforced by a regulator/agency acting in a managerial way, but which is not present in the structure of non-regression clauses and investment treaties in general) are all characteristics of a shift towards a regulatory paradigm in investment treaties, although with only piecemeal developments at the moment. What, exactly, is this pattern and the extent to which non-regression clauses underlie such a pattern will be explored in this article.

Footnotes omitted from this introduction.

This paper will be part of the second TDM Special Issue on "International Investment Arbitration - Environmental Protection and Climate Change Issues". More information here www.transnational-dispute-management.com/news.asp?key=1893