Rethinking Investment Treaties

This executive summary outlines a roadmap for rethinking international investment treaties by shifting the focus from fixing existing treaty problems to identifying the foundational policy problems the regime should solve. The authors analyze three main categories: the encouragement of sustainable investment, the regulation of investment project impacts, and cross-cutting governance and international cooperation issues.

• The authors argue that treaties have a limited role in encouraging sustainable investment, as national and regional legal frameworks are better suited for this purpose. While treaties could potentially address collective action problems—such as high borrowing costs in developing countries or subsidies—they are not seen as necessary for investment liberalization and market access, as states can remove such restrictions independently.
• Regarding the protection of investments, the document questions the continued relevance of the treaty protection model due to its known inefficacy and associated costs. The authors suggest that if states continue to grant such protections, they should be restricted to sustainable investments and limited to preventing 'opportunistic conduct' by the host state.
• To manage the impacts of foreign investment projects, the roadmap asserts that domestic law should remain the primary level of regulation, with treaties serving a complementary role. Treaties should mandate that investors comply with national laws and should focus on ensuring that legal systems are available for tort and civil liability actions when investors engage in misconduct.
• The document identifies several areas where international cooperation via treaties could address collective action problems in investment governance. These include phasing out fossil fuel investments and subsidies, creating funds for just energy transitions, reducing capital costs in developing countries, and improving transparency through common beneficial ownership registries and government contracts transparency.

APA

Ostřanský, J., & Bonnitcha, J. (2024). Rethinking Investment Treaties. International Institute for Sustainable Development. https://www.iisd.org/system/files/2024-05/rethinking-investment-treaties-roadmap-summary.pdf

Chicago

Ostřanský, Josef, and Jonathan Bonnitcha. Rethinking Investment Treaties. International Institute for Sustainable Development, 2024. https://www.iisd.org/system/files/2024-05/rethinking-investment-treaties-roadmap-summary.pdf.

Wikipedia

{{cite report |last1=Ostřanský |first1=Josef |last2=Bonnitcha |first2=Jonathan |title=Rethinking Investment Treaties |publisher=International Institute for Sustainable Development |date=May 2024 |url=https://www.iisd.org/system/files/2024-05/rethinking-investment-treaties-roadmap-summary.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{ostansk2024rethinking, author = {Ostřanský, Josef and Bonnitcha, Jonathan}, title = {{Rethinking Investment Treaties}}, institution = {International Institute for Sustainable Development}, year = {2024}, month = may, url = {https://www.iisd.org/system/files/2024-05/rethinking-investment-treaties-roadmap-summary.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }