Investment treaties and national sovereignty: latest developments

• Published date: 27 May 2021
• DOI: https://doi.org/10.1108/JITLP-01-2021-0001
• Date: 27 May 2021
• Pages: 127-141
• Subject Matter: Strategy,International business,International business law,Economics,International economics,International trade
• Author: Martin Karas,Katarína Brocková

Investment treaties and national

sovereignty: latest developments

Martin Karas

Department of International Political Relations,

University of Economics in Bratislava, Bratislava, Slovakia, and

Katarína Brockov

a

Department of International Law, University of Economics in Bratislava,

Bratislava, Slovakia

Abstract

Purpose –The purpose of this paper is twofold. First, it identif‌ies the latest trends in investment treaty

making anddetermines the degree to which these trends affect theregulatory space of nation states. Second, it

situates the conf‌lict between investment protection and national sovereignty on the level of investment

treaties within the wider theoretical framework of the debate between neoliberalism and neorealism in the

f‌ield of internationalrelations.

Design/methodology/approach –This researchpaper uses qualitative content analysisof international

investment treaties withthe aim of comparing a sample of new investment treaties with a sample of treaties

from a previousgeneration.

Findings –The f‌indings of the paper indicatethat the language of investment treaties signed recently tends

to promote greater regulatory space for the nation states compared to previous generation of treaties.

However, the analysis also suggests that the changesstill offer signif‌icant leeway to investment tribunals in

interpreting the new treaty language,which could mean that the move towards greater national sovereignty

in internationalinvestment law will not be as signif‌icant as many suggest.

Originality/value –Originality of the paper consists mainly in explicit connection it makes between

international investmentlaw and the debate between neorealism and neoliberalismin international relations

theory.

Keywords Neoliberalism, International investment law, Sovereignty, Investment protection,

Investment treaties, Neorealism

Paper type Research paper

1. The new “rise”of the nation state in investment law?

Internationalism and free trade have come under serious challenge in some parts of the

world over the past years. Economic nationalism has been on the rise, as evidenced by

the “America First”catchphrase of president Trump, or the narrative over Brexit. While

these could potentially be seen as isolated, short-term developments, United Nations

Conference on Trade and Development’s (UNCTAD) numbers on the rising protectionism

provide a f‌irm support for the claim (UNCTAD, 2018).These f‌indings are not limited to the

area of trade, as protectionist measures, most notably stricter screening mechanisms are

also identif‌ied in the domain of internationalinvestment (UNCTAD, 2019, p. 86). This paper

analyses similar trends in the domain of international investment law on the level of

international investmenttreaties and situates this development within the framework of the

theoretical discussion between neorealism and neoliberalism in the theory of international

relations.

Investment

treaties

127

Received4 January 2021

Revised17 March 2021

Accepted17 March 2021

Journalof International Trade

Lawand Policy

Vol.20 No. 2, 2021

pp. 127-141

© Emerald Publishing Limited

1477-0024

DOI 10.1108/JITLP-01-2021-0001

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