Rethinking Investment Treaties

The document argues that while encouraging sustainable investment is a central policy challenge, treaties have a limited role compared to national and regional legal frameworks. It suggests that if treaties are used, they should focus on complementary roles such as facilitating international cooperation on high borrowing costs in developing countries, phasing out fossil fuel investments, and ensuring access to justice for those affected by investor misconduct. The authors emphasize that domestic law should remain the primary level of regulation for the social and environmental impacts of investment projects.

• The authors conclude that treaties have a limited role in encouraging sustainable investment, as national and regional legal frameworks are better suited for this purpose. Specifically, they argue that states can remove restrictions on sustainable foreign investment independently without a treaty, and the policy case for the continuing relevance of the treaty protection model is "doubtful".
• Regarding the impacts of investment projects, the document asserts that domestic law should be the primary regulatory level, with treaties serving a complementary role. Treaties should explicitly require that investors "continuously comply with national laws" and focus on ensuring that legal systems are available for tort and civil liability actions when investors commit misconduct.
• The document identifies several collective action problems where international cooperation via treaties could be beneficial, including phasing out fossil fuel investments, ending their public subsidies, and creating funds to support a "just energy transition". Other potential areas for treaty-based cooperation include addressing high capital costs in developing countries and promoting technology and knowledge transfers.
• To ensure positive social and environmental outcomes, the document argues that treaties should not prohibit performance requirements that might hamper national developmental policies. Instead, they should facilitate "productive industrialization" through the creation of decent work, productive linkages with local economies, and technology transfers.

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} }