Emerging Trends in FTAs and Public Health: Are the EU, USA, and China shifting positions?
Thursday, 7 October 2021
16:00 – 17:30 CET
The South Centre is holding a series of webinars on emerging trends related to free trade agreements (FTAs) and investment agreements that impact public health. The goal is to generate awareness, share experiences and expand knowledge for academics, policymakers and negotiators in ongoing and/or future negotiations. After our first webinar focused on investment treaties and IP, we this webinar examines the EU, USA, and China’s recent experiences.
Implementation of a TRIPS Waiver for Health Technologies and Products for COVID-19: Preventing Claims Under Free Trade and Investment Agreements
by Carlos M. Correa, Nirmalya Syam and Daniel Uribe
While increasing support from WTO members for a proposed waiver from certain obligations under the TRIPS Agreement with regard to health products required for responding to COVID-19 has made a decision on the TRIPS waiver imminent, the waiver will have to be implemented domestically by WTO members through appropriate legislative, administrative or judicial measures, including through executive orders that have been utilized to implement emergency measures in the context of the COVID-19 pandemic. In this regard, the scope of the TRIPS waiver, as well as the terms of applicable free trade agreements (FTAs) and international investment agreements (IIAs) will also impact the policy space available to countries to implement the waiver. Ensuring a broad scope of the waiver, as well as complementary measures to safeguard the implementation of the waiver from potential challenges under FTAs or IIAs will be critical. This research paper discusses some options that could be explored to enable the implementation of the TRIPS waiver by overcoming possible impediments that could arise under such agreements.
Virtual Consultation in support of the UN Working Group’s 2021 Report to the UN General Assembly on Human Rights-Compatible International Investment Agreements
South Centre, 23 June 2021
Foreign direct investment (FDI) should support States’ efforts to “bring the SDGs and goals of the Paris Agreement to life for all people, everywhere.” However, achievement of these objectives is slowed down in the current situation where investor-State dispute settlement (ISDS) mechanisms are included in international investment agreements (IIAs). These mechanisms have increased the exposure of States to claims from foreign investors against regulatory measures taken to protect and guarantee a clean and safe environment, public health, human rights, social inclusion, and poverty reduction.
In the current scenario marked by the impact of the COVID-19 pandemic, FDI can be a valuable source of financing a better and fairer recovery, including investment needed to achieve the full realisation of all human rights. But to achieve this potential, there is a need to reshape the international investment regime, including through the reform of its substantive rules and standards, as well as of the ISDS mechanisms embedded in existing IIAs.
The South Centre and the United Nations Working Group on human rights and transnational corporations and other business enterprises convened a virtual consultation to identify and assess the different challenges developing countries face while negotiating or reforming IIAs in line with their international human rights obligations. The virtual consultation aimed at highlighting and discussing some of the most common concerns and challenges those developing countries face in the promotion of responsible investment practices, including an exploratory discussion about balancing the rights and obligations of investors in IIAs and safeguarding the sovereign right of States to regulate in the public interest for building back better and fairer in face of the COVID-19 pandemic. It also discussed possible reforms of the ISDS mechanism.
UNCITRAL Working Group III: Moving forward towards consensus or loosing balance?
By Daniel Uribe and Danish
This policy brief considers some concerns arising from the ongoing discussions on procedural reform of investor-State Dispute Settlement (ISDS) in the United Nations Commission on International Trade Law (UNCITRAL) Working Group III. It highlights the need to allocate sufficient time to deliberate upon the important issues being raised by developing countries. It further discusses some structural reform options that have been identified by the Working Group and reflects on some concerns arising from a possible ‘single undertaking’ approach being implemented through a future possible multilateral agreement on ISDS.
Investment Policy Options for Facing COVID-19 Related ISDS Claims
By Daniel Uribe and Danish
Developing and least developed countries have undertaken a number of measures to fight against the multidimensional impacts of the COVID-19 pandemic. Such measures and those that may be adopted in the context of the recovery efforts are, however, susceptible to challenges by foreign investors using investor-State dispute settlement mechanisms.
This policy brief first considers the kinds of measures States have adopted to limit the spread of COVID-19, protect their strategic sectors and promote economic recovery, including through foreign investment aftercare and retention. It then addresses how the investor-State dispute settlement system (ISDS) has been used by investors in times of crises, based on the analysis of the awards in several cases brought against both developed and developing countries.
Against this backdrop, the brief elaborates on the different options and initiatives States can take for preventing ISDS claims at the national, bilateral, regional and multilateral levels. It concludes with some policy advice for developing and least developed countries to face possible COVID-19 related ISDS claims in the future.
Emerging Trends in FTAs and Public Health: Investment Agreements and Intellectual Property
Friday, 28 May 2021 – 16:00-17:30 (CET)
The inclusion of TRIPS-Plus provisions in developing country IP laws, as a result of negotiations of free trade agreements (FTAs) continues to be of concern. In addition, there are various emerging areas that require attention from developing countries, where accumulated knowledge and institutional learning are more limited. These include investment agreements that include ‘intellectual property’ as a category of investment – with subsequent ISDS mechanisms, as well as competition and investment chapters or agreements that may restrict the policy space, such as the China-EU Comprehensive Investment Agreement. There are several important developments to consider for the upcoming years. New negotiations in the period of Covid-19 crisis, when countries are in dire financial situations, may lead to even more unbalanced negotiations. The UK is pursuing new agreements after Brexit with developing countries, while the USA has signaled renewed attention to multilateralism and at the same time is continuing to make use of Section 301 of its trade law to advance reforms in third countries. The AfCFTA negotiations of the intellectual property chapter are set to start this year. Moreover, the RCEP Agreement is to be implemented via national law amendments and attention must be given in particular to the process for Least Developed Countries (LDCs) and the technical assistance offered.
In this context, the South Centre is holding a series of webinars on emerging trends related to free trade agreements (FTAs) and investment agreements that impact public health. In this first session, we will discuss the topic of investment agreements and intellectual property, including varied angles to the issue, such as perspectives for post Covid-19 agreements, the legal construction of IP as a category of investment, the challenges of ISDS and policy reform options, and the analysis of a concrete case.
Could COVID-19 trigger ‘localizing’ of international investment arbitration?
In light of the challenges and travel restrictions due to the COVID-19 pandemic, many developing countries have been unable to effectively participate in international investment arbitration proceedings, traditionally held in locations like Washington D.C. and The Hague. To ease the heavy burdens currently being placed on States and ensuring investor confidence, this Policy Brief argues for the ‘localization’ of investor-State dispute settlement (ISDS) proceedings in host States and regions where the investment is actually located. It highlights the various advantages that localizing ISDS can bring, and the different regional initiatives already working towards this purpose. The brief also considers relevant legal and policy aspects, and seeks to provide concrete suggestions for the localization of ISDS as a small step towards the holistic reform of international investment arbitration.
Countries’ Policy Space to Implement Tobacco Packaging Measures in the Light of Their International Investment Obligations: Revisiting the Philip Morris v. Uruguay Case
By Alebe Linhares Mesquita and Vivian Daniele Rocha Gabriel
This Policy Brief aims to provide a concise analysis of the international investment dispute involving Philip Morris subsidiaries and the Republic of Uruguay. It depicts the main legal and political background that preceded the case, analyzes the decision reached by the arbitral tribunal, and assesses the award’s major regulatory and policy implications. It intends to contribute to the discussions on how and to what extent States can adopt tobacco control measures without violating their international obligations to protect the investment and intellectual property of tobacco companies. The main lesson that can be learned from the analysis of the Philip Morris v. Uruguay case is that investors rights are not absolute and can be relativized when there is a clash between private and public interests, such as in the case of public health. As a result, claims such as indirect expropriation and fair and equitable treatment can be dismissed. Finally, one of the main consequences is the progressive change in the design of international investment treaties, containing more provisions related to the right to regulate.
Guaranteeing Access to Medicines: Reforming Trade and Investment Treaties in the COVID-19 Era
Eight months into COVID-19, what is the status of the international investment regime and access to essential medicines? The GDP Center’s Working Group on Trade and Access to Medicines will host a panel discussion on trade, the investment regime, and access to essential medicines. The event is co-sponsored by the South Centre, the intergovernmental organization of developing nations based in Switzerland.
The ISDS Reform Process: The missing development agenda
By Nicolás M. Perrone
The foreign direct investment (FDI) governance agenda is centred on the reform of international investment agreements (IIAs) and investor-state dispute settlement (ISDS). The proliferation of IIAs and ISDS has contributed to narrowing the FDI agenda. A key policy question is whether this fragmented approach remains consistent with the 2030 Sustainable Development Goals (SDGs). Current FDI discussions point at the need for a holistic approach in this policy area, quite the opposite of a regime primarily aimed to protect foreign investors through treaty standards and international arbitration. The realisation of the SDGs depends on multi-stakeholder partnerships to combat poverty and provide clean water and energy to the world population. Crucially, these partnerships will require more cooperation and coordination than IIAs and ISDS can promote and nurture.
Reforms to Investor-State Dispute Settlement (ISDS) are being discussed in the United Nations Commission on International Trade Law (UNCITRAL) Working Group III. One possible reform is the development of an appellate mechanism, either as part of the proposed two-tier standing investment court, or as a stand-alone appellate mechanism. From the perspective of developing countries as host states that face possible claims from investors, how appealing is an appellate mechanism in ISDS?
Intellectual Property under the Scrutiny of Investor-State Tribunals
Legitimacy and New Challenges
By Clara Ducimetière
In 2009, C.S. Gibson was suggesting that: “With this early coverage of intellectual property in BITs, it is perhaps surprising that there has yet to be a publicly reported decision concerning an IPR-centered investment dispute. Given the trajectory of the modern economy, however, in which foreign investments reflect an increasing concentration of intellectual capital invested in knowledge goods protected by IPRs, this could soon change”. A couple of years later, the first investment cases dealing with IP issues were made public.
In this context, this paper first addresses the conditions that have to be fulfilled in order to bring intellectual property claims in investment arbitration, by touching upon the question of the definition of an investment in theory and in practice. It also tries to shed light on some of the implications of recent arbitral awards touching upon this interaction between intellectual property and investment protection, from a legal and regulatory perspective.
On the other hand, the specific situation of the European Union is scrutinized, and in particular the project put forward by the European Commission to adapt the dispute settlement system for the protection of investments.