Sub-theme 4. Commons between colonial legacies and the Anthropocene
Panel 4.10.
Reclaiming commons under or against international investment law? Crossing perspectives from outside, within, and along environment related international arbitration
International investment law, by curtailing market from politics through the postcolonial system of international arbitration, manifests the private enclosure of law itself from the prerogatives of states. Its core mechanism, investors-state dispute settlement (ISDS), enforces a global property regime that recognizes the protection of “foreign investments” at the expenses of other access claims that states and other institutions may wish to consider as property rights or as commons to regulate in the name of the public interest and a liveable environmental future. Amongst other objects of critique, ISDS may enable private investors to chill climate change regulation at local and national levels, to circumvent environmental responsibilities under non-recourse litigation, or to extract rents from collectively owned resources managed by states in the form of compensations and interests upon so-called “stranded assets”.
This panel seeks to explore the various social, legal, political, and epistemological efforts to safeguard environmental commons against investment treaties’ all-encompassing propertisation from outside, within, or in parallel to the international investment treaty regime. In particular, the panel welcomes contributions that question the interactions between, and the translations across outsiders’ (e.g. social and political movements, amicus curiae), insiders’ (e.g. arbitration institutions, litigators), and substitutes’ (alternative courts and dispute resolution mechanisms) in environment related arbitration. How are notions such as investment, public goods, or fair and equitable treatment upheld and given meaning to foster or contest the propertisation of environmental commons in arbitral disputes? For whom, by whom, and under which circumstances are these notions filled with or emptied of legal force?
1. Investor-State vs Landlord-Stranger: Capitalizing on competing property titles over Simandou in Guinea
Harvard Law School, USA
Simandou mountain chain in Guinea contains the biggest unexploited high-quality iron ore reserves in the world. The French colonial regime, Soviet Union, Mitsubishi, Rio Tinto, Chinalco, Vale, Beny Steinmetz Group (BSGR) and Société Minière de Boké have all successively explored and planned to exploit it. However, no iron has been mined to date. The inhabitants of the Simandou mountain chain have hoping that the construction of the mine would bring jobs and modern amenities, just as the Guinean government has been hoping tax revenue and development. Even if not dug, the projected mine has, however, allowed investors to capitalize on the mining prospects, and so largely thanks to guarantees offered by investor-state arbitration. In 2007, Rio Tinto fended off a US$142bn hostile takeover by BHP Billiton by claiming Simandou to be undervalued in its books. In 2011, BSGR sold its rights to half of the reserve to Vale for US$2.5bn and once the Guinean government had revoked its concession based on corruption charges, the company simply sued the country in investment arbitration. At the same time, Simandou inhabitants’ attempts to leverage their position as local landlords to get the mine to open and bring them tribute failed. Based on ethnography in Guinea and analysis of submissions in the various litigations and arbitrations to which this saga has given rise, this presentation shows how different parties’ ability to extract financial value from a mine is conditioned by the scalar strength of their respective property titles.
2. Withdrawing from the Energy Charter Treaty to protect the commons? When mitigating investors’ uncertainties threatens the urgency of an energy commoning
University of Bern, Switzerland
The rationale for the existence of investment treaties, which proliferated in the aftermath of the Cold War, is twofold: reducing the uncertainty of foreign investments and increasing the economic development of host countries. The Energy Charter Treaty (ECT) of 1994, is no exception to this logic as it was born of the will to facilitate energy investments from Western to Eastern Europe. With the increasing number of international arbitration cases brought on the basis of the ECT, the treaty is now under fire. Despite its ongoing reform, many countries have already announced their intention to withdraw from it, in the name of its inadequacy for the current climate emergency, and even the threat it would pose to climate policies. At a time when the ecological crisis is also an energy crisis, and when the scarcity of essential natural resources for our energy needs is bringing to the fore the idea of energy as a common good, the reconfiguration of state-investor relations in the energy sector has become an urgent matter. This contribution will thus seek to shed light on how the ECT threatens the horizon of an energy commons, while paying particular attention to recent developments that the treaty is currently facing and the new possibilities that could open up for an energy commoning.
3. Imperial encounters: a research agenda to reexamine the relationship between international arbitration, value chains and the future’s commons
Catholic University of Lille, France
Cobalt-rich Democratic Republic of Congo and rare earths-rich Burundi loom large in what The Economist has termed ‘the new scramble for Africa’ (2019) against the backdrop of the global rush for the critical minerals needed for the ‘energy transition.’ The trajectories of both countries have also featured widely in the two revolutions that have characterized the post-Cold war international landscape: the boom of international investment arbitration and the intensification of the globalization and financialization of value chains. This paper shifts the focus from the (needed) critique of international arbitration towards the question of the nexus between trans/national law, political change and capitalist expansion. I focus on the zones of contact between the two countries and the world economy as sites of ‘imperial encounters,’ that is symbolic, institutional, and professional spaces of real connections that offer a vista into histories that are connected due to their reciprocal embeddedness in imperial legacies, and because they reflect the interconnectedness between law, politics, and finance in the North and the Global South. Reexamining the position of international arbitration as a set of practice and institutions within and in relation to these zones of imperial encounters, including in the ongoing rush for Burundi as an origination site for rare earths, is a way to ask a crucial question in the current context: is international law enabling the status quo, or can it empower change?
4. The legal business of consistent inconsistency: environmental sovereignty and the impossible reform of international investment law in Tanzania.
University of Bern, Switzerland
In 2017, Tanzania reformed the legal framework which regulates foreign investment in natural resources. The three acts (i.e. so-called Contract review act, Permanent sovereignty act, and Public-Private Partnership act) questioned Tanzania’s participation in the international investment treaty regime, which allows for investor-state disputes to be settled in arbitration tribunals outside national jurisdictions. Through the acts, the Tanzanian government sought to renegotiate contracts’ “unconscionable terms”, such as restricting the right of the State to regulate or undermining measures to protect the environment, and to prohibit investment disputes to be settled in foreign jurisdictions and private fora. While several arbitration notices over investments in extractive projects of so-called critical minerals were subsequently launched, a new arbitration law, which re-opens the door to the ISDS system, was also adopted. This paper investigates how such ambiguous framework – with competing laws simultaneously prohibiting and allowing international arbitration – and its resulting legal uncertainty are perceived both by actors of the arbitration field and by environment related civil society organisations in Tanzania. While civil society organisations tend to reclaim greater legal consistency, including through the maintenance of ISDS provisions considered by many as a necessary evil, arbitration actors seem to accommodate well to its intended ban. They seem to perceive the assumed “legal inconsistency” of the Tanzanian investment framework as overall favourable to the growing enclosure of investment law, whose business is significantly growing in east Africa.
