2019 Reports

Investment Treaties, Investor-State Dispute Settlement and Inequality: How International Rules and Institutions Can Exacerbate Domestic Disparities

Sachs, Lisa E.; Johnson, Lise

International investment treaties entrench and exacerbate intra-national inequality by:

1) Providing stronger substantive legal rights to a certain class of actors that in turn strengthen the legal force of their economic rights and “expectations”, with potentially negative impacts on the competing rights and interests of other stakeholders; and
2) Providing unequal procedural rights to a certain class of actors, easing their ability, through ISDS, to challenge regulatory measures negatively impacting their economic interests, while other individuals and entities continue to face relatively high legal and practical barriers to using litigation to protect and/or enhance public interest objectives.

This Working Paper, adapted from the book chapter “Investment Treaties, Investor-State Dispute Settlement and Inequality: How International Rules and Institutions Can Exacerbate Domestic Disparities” (in José Antonio Ocampo, ed., International Rules and Inequality: Implications for Global Economic Governance (Columbia University Press), 2019-01), explores these channels in greater depth. It also calls for further research to explore how international investment governance could be enlisted to combat inequality, instead of embedding and inflaming it.