POTESTÀ REGOLAMENTARE E DIRITTO INTERNAZIONALE DEGLI INVESTIMENTI: LA TUTELA DELL¿AMBIENTE TRA CRISI DI LEGITTIMITÀ E PROPOSTE DI RIFORMA

The international regime for the protection of foreign investments has consolidated though a dens network of agreements, so-called international investment agreements (IIAs), aimed at ensuring stability and security of foreign investments. Conceived to safeguard the interests of capital-exporting States, these instruments establish treatment standards in favor of investors and grant them the right to initiate international arbitration proceeding against the host States in the event of an alleged breach of its obligations. For a while, the investor-State dispute settlement (ISDS) mechanism was rarely used. Since the 1990s, however, its application has significantly increased, thereby revealing certain shortcomings and raising doubts as to its suitability for resolving disputes involving matters of public interest. In particular, arbitral practice has often yielded inconsistent outcomes, due to the ad hoc nature of ISDS arbitration, making it difficult to distinguish between measures incompatible with IIAs obligations and legitimate acts of the State’s sovereign regulatory powers. States have repeatedly denounced the unpredictability of arbitral awards as well as the insufficient consideration given to public regulatory needs. These shortcomings have contributed to a growing legitimacy crisis of the system and to the emergence of the so-called regulatory chill phenomenon, whereby States refrain from adopting measures in the public interests for fear of arbitral proceedings. Considering this, the thesis will seek to analyze the instruments that international law provides to States to rebalance the protection of investments with the exercise of regulatory authority, with particular reference to environmental law. Following the historical overview of the regime and the examination of its main features presented in the first chapter, the second chapter will focus on the interpretation of the standards of treatment set forth in IIAs within arbitral practice, with regard to cases in which State measures adopted in the protection of collective interests have been challenged. The analysis will show how case law has displayed elements of inconsistency and a tendency to broadly expand the scope of guarantees accorded to investors and will highlight the consequences of this approach on the legitimacy of the systema and on States’ regulatory discretion in the field of environmental protection. The third chapter will examine the causes of jurisprudential inconsistency, which may be traced back to substantive issues and will identify possible international law instruments designed to limit arbitral discretion in ISDS disputes. The analysis will focus on features of so-called new generation IIAs, which introduce more precisely defined treatment standards, explicit clauses safeguarding regulatory autonomy, carve-outs and exceptions. Special attention will be devoted to provisions expressly recognizing environmental protection as an interest deserving consideration. The fourth chapter will turn to international law instruments of procedural nature, useful for reforming the ISDS mechanism, including those ensuring greater transparency of the proceeding. The role of amici curiae or of non-disputing States interventions and the possibility for States to bring counterclaims will also be examined, as mechanisms that promote consideration non-economic interests during disputes. Finally, possible solutions to enhance consistency in arbitral decisions will be analyzed, such as joint interpretation by investment committees and the potential establishment of an appellate mechanism or a multilateral investment court. This comprehensive analysis will allow for an assessment of the effectiveness of those instruments in promoting a balanced international investment framework, capable of reconciling the protection of investors with the safeguarding of States’ regulatory powers, particularly in the context of environmental protection. The fifth chapter will ultimately assess the impact of these reforms, which on the one hand reduce the protection granted to investors, while on the other mitigate the features that ISDS shares with commercial arbitration, on the original function of IIAs and the potential disinterest of State in such instruments. In this regard, particular attention will be paid to the termination of numerous treaties and to the growing withdrawal from the 1965 ICSID Convention, underlining the tendency of certain States to promote alternative treaty models for this purpose. In particular, the growing importance of investment facilitation agreements will be examined. Unlike traditional IIAs, such agreements limit treatment standards and exclude ISDS. The analysis will assess whether these instruments may represent a more effective alternative for the development of a more balanced system.