Research On Environmental Protection Clauses In IIAs

This article conducts its research on Environmental Protection Clauses(hereinafter “EPCs”)in international investment treaty.Different from the traditional Investment Protection Clauses(hereinafter “IPCs”),EPCs mainly reflect the interests of the public rather than private investors.The appearance of EPCs is considered a symbol of revolution in investment law,which finally moves towards a more balanced way between private interests and public interests.Recently,EPCs are already embedded in some international investment agreements(hereinafter“IIAs”)signed by China.Thus,it's beneficial to find the potential implications for China and optimize EPCs accordingly.Chapter one constitutes a background research for EPCs.Section I explains the necessity and possibility for introduction of EPCs in IIAs.Section II points out the interest groups behind the EPCs and their respective attitudes towards EPCs.Only with each party's interests properly considered can agreements be reached on the subsequent optimization of EPCs.Section III manages to classify EPCs into four categories according to their legal binding force,namely declarative clauses,delegation clauses,disclaimer clauses and obligatory clauses.This classification paves the way for following research by providing an analysis tool.Chapter two analyzes EPCs in Typical regional and bilateral IIAs from the perspective of comparative law,and makes a deduction on theevolving trend of EPCs.Section I discusses IIAs signed by foreign countries and Section two describes the situation in China.This chapter argues,although with some improvements already,there are there problems prominent in most IIAs:(1)weak binding effects of EPCs,(2)strong limitations on disclaimer clauses on the one hand and obscure applicable preconditions on the other,(3)unclear relations between delegation clauses and IPCs in conflicts.This chapter provides context for subsequent case study and predicts the potential obstacles for EPCs in investment arbitration.Chapter three selects six environment-related investment disputes as samples for research.For one thing,this article finds the positive influences of EPCs,which is supported by the tribunal's recognition of environment regulatory power exercised by host state and further evidenced by their revised treaty interpretation approach.For another,the article notices some potential negative implications of EPCs.That's,the host states are at risks when they breached their obligations for environmental protection under EPCs.At last,it's worthy to mention,as indicated by case study results,IPCs won't be invalid simply for the purposes of environmental protection.The tribunal only supports those host states which exercise their power under the existing IIAs and in accordance with due procedure.In fact,EPCs mainly play a role in obiter dictum and incidental reasons rather than defenses.This illustrates the necessity for optimization of EPCs.This chapter as a whole provides valuable applicable rules for conciliation between EPCs and IPCs.Chapter four aims to resolve the conflicts between EPCs and other provisions,namely IPCs in IIAs and provisions in other binding environmental agreements.Section I chooses three most often contentious IPCs in environment-related investment disputes as examples,i.e.Non-discriminatory clause,FET clause and Expropriation clause.This article points out the three mentioned clauses can set limits on theapplication of EPCs,substantively and procedurally.Conversely,EPCs also set a high threshold for the breach of these IPCs.This section further points out available solutions to this problem,which calls for a multi-faced approach to adopt intertwined measures in treaty-making,treaty performance and treaty interpretation.Section II first discusses the conflicts between EPCs and provisions in other environment agreements.Then,this section provides a preliminary answer to this question,which is far from satisfaction considering current theory and practice divergence on this issue.This chapter provides a theory frame for optimization in next chapter.Chapter five,on the basis of above discussion,turns to EPCs optimization in IIAs signed by China.Section I summarized the main features of EPCs in Chinese IIAs and further points out their disadvantages,i.e.lack of procedural and mechanism clause and insensitive to state interests and without clear distinctions between different counterparties.Considering that,Section II responds to the current problem by providing suggestions in three ways.First,balance the relationship of environment protection and investment protection on the basis of state interests.Second,be flexible and practical to systematic regulation of environment concerns,either approach is fine at this stage.Finally,pay attention to both substantive justice and procedural justice,i.e.the goal of environment protection and due process doesn't contradict with each other.