Separate Comments of TEPAC Members on the Investment Chapter of the U.S.- Australia Free Trade Agreement

The authors argue that while the U.S.-Australia FTA's lack of an investor-state dispute mechanism is positive, the substantive investment provisions still grant foreign investors rights exceeding those of domestic investors under U.S. law. They highlight risks to environmental regulation, the lack of a general environmental exception, and the subjective nature of 'fair and equitable treatment' standards.

• The authors approve of the U.S.-Australia FTA investment chapter's lack of an investor-state dispute mechanism, stating that relying on domestic courts and state-to-state settlement better balances investor rights against the public interest and supports the rule of law.
• The authors contend that the agreement violates the Trade Act of 2002 mandate that foreign investors receive no 'greater substantive rights' than domestic investors, as it relies on international law concepts and ad hoc panels not bound by U.S. Supreme Court precedent.
• The agreement is criticized for lacking a general environmental exception in its investment chapter, which the authors argue threatens the ability of governments to enact public interest policies without being forced to compensate investors.
• The authors argue that the 'fair and equitable treatment' standard is inherently subjective, lacks a corresponding right in U.S. law, and could allow arbitral tribunals to second-guess democratic governmental actions.
• The expropriation provisions are deemed insufficient because they omit critical U.S. legal principles, such as the requirement that governmental action must permanently interfere with a property in its entirety to constitute a taking.
• The authors note a lack of evidence that investment rules are even necessary for relations with Australia, stating there is no public information suggesting Australia has mistreated U.S. investors or has an incapable judicial system.

APA

Butler, W., Karpatkin, R. H., Magraw, D., & Zaelke, D. (2004). Separate Comments of TEPAC Members on the Investment Chapter of the U.S.- Australia Free Trade Agreement. Center for International Environmental Law. https://www.ciel.org/wp-content/uploads/2015/05/Tepac_Comment_9Mar04.pdf

Chicago

Butler, William, Rhoda H. Karpatkin, Daniel Magraw, and Durwood Zaelke. Separate Comments of TEPAC Members on the Investment Chapter of the U.S.- Australia Free Trade Agreement. Center for International Environmental Law, 2004. https://www.ciel.org/wp-content/uploads/2015/05/Tepac_Comment_9Mar04.pdf.

Wikipedia

{{cite press release |last1=Butler |first1=William |last2=Karpatkin |first2=Rhoda H. |last3=Magraw |first3=Daniel |last4=Zaelke |first4=Durwood |title=Separate Comments of TEPAC Members on the Investment Chapter of the U.S.- Australia Free Trade Agreement |publisher=Center for International Environmental Law |date=9 March 2004 |url=https://www.ciel.org/wp-content/uploads/2015/05/Tepac_Comment_9Mar04.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@misc{butler2004separate, author = {Butler, William and Karpatkin, Rhoda H. and Magraw, Daniel and Zaelke, Durwood}, title = {{Separate Comments of TEPAC Members on the Investment Chapter of the U.S.- Australia Free Trade Agreement}}, publisher = {Center for International Environmental Law}, year = {2004}, month = mar, url = {https://www.ciel.org/wp-content/uploads/2015/05/Tepac_Comment_9Mar04.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }