Renegotiation of Australia’s Bilateral Investment Treaties

The International Institute for Sustainable Development (IISD) submitted recommendations to the Australian government regarding the renegotiation of older-generation bilateral investment treaties (BITs). The IISD argues that these treaties prioritize investor protection and investor-state dispute settlement (ISDS) over public policy and urges a shift toward treaties that facilitate sustainable investment and climate action.

• IISD recommends that Australia move away from the traditional investment protection model when renegotiating BITs with Czechia, Egypt, Hungary, Lithuania, Poland, and Romania, suggesting that Australia's Green Economy Agreements serve as a better blueprint.
• The IISD proposes that future treaties should prioritize the host state's capacity for sustainable development by facilitating productive industrialization, encouraging technology and knowledge transfer, and ensuring the creation of high-quality employment.
• To protect national regulatory autonomy, IISD suggests that domestic legal frameworks should be the primary regulators for public health, labour, and the environment, and that treaties should require investors to continuously comply with host state laws.
• IISD advises against the inclusion of investment protection and ISDS in treaties, stating that these are better handled via national legal frameworks. If they are included, the IISD recommends they be limited to sustainable investments and modeled on political risk insurance.
• To align with the Paris Agreement, IISD recommends that treaties include specific carve-outs to exempt all fossil fuel investments and legitimate climate change measures from ISDS and treaty protection.
• The document calls for a complete overhaul of how damages are calculated in ISDS to prevent exorbitant awards, specifically recommending a ban on speculative valuations like the discounted cash flow method and capping awards to actual expenditures.

APA

International Institute for Sustainable Development (2026). Renegotiation of Australia’s Bilateral Investment Treaties. https://www.iisd.org/system/files/2026-04/submission-renegotiation-australia-bilateral-investment-treaties.pdf

Chicago

International Institute for Sustainable Development. Renegotiation of Australia’s Bilateral Investment Treaties. 2026. https://www.iisd.org/system/files/2026-04/submission-renegotiation-australia-bilateral-investment-treaties.pdf.

Wikipedia

{{cite report |author=International Institute for Sustainable Development |title=Renegotiation of Australia’s Bilateral Investment Treaties |date=April 2026 |url=https://www.iisd.org/system/files/2026-04/submission-renegotiation-australia-bilateral-investment-treaties.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{internationalinstituteforsustainabledevelopment2026renegotiation, author = {{International Institute for Sustainable Development}}, title = {{Renegotiation of Australia’s Bilateral Investment Treaties}}, institution = {International Institute for Sustainable Development}, year = {2026}, month = apr, url = {https://www.iisd.org/system/files/2026-04/submission-renegotiation-australia-bilateral-investment-treaties.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }