Comment: The false hopes and empty promises of investment treaty modernization
'The false hopes and empty promises of investment treaty modernization;, 5 October 2021
"On September 9, an investor–state dispute settlement (ISDS) tribunal released its final decision on the merits of a closely watched case pitting Eco Oro Minerals, a Canadian mining company, against the Republic of Colombia. Though both sides initially declared victory, the truth is the tribunal handed a devastating win to Eco Oro with implications for environmental protection, human rights and climate change policy in both Canada and Colombia.
This bad decision reinforces the ever-present danger of “fair and equitable treatment” guarantees, however carefully worded, in Canadian investment treaties. Importantly, Eco Oro’s win also exposes, yet again, the hollowness of our government’s insistence that investment treaties do not compromise environmental protection...
...Colombia's taxpayers are now on the hook to compensate Eco Oro, at a level to be set by the tribunal in the next phase of the arbitration. Though it will likely be less than the nearly US$700 million sought, ordering any amount of compensation is problematic as it codifies the unacceptable view that governments must pay off foreign investors when they protect the environment...
...Our governments—in Colombia and Canada—claim that modern language in investment treaties and FTAs can protect more policy space by limiting the scope of “minimum standard of treatment” and “fair and equitable treatment” provisions. Again and again, private tribunals show that this is not the case. Arbitrators, like those in the Eco Oro case, will rule expansively in the interest of private capital over government’s right to regulate...."