Renegotiation of investment treaties as a mean of internalization

Abstract

A few states in Asia and Latin America have recently embarked on an overhaul of their investment treaty program by terminating and renegotiating the states’ bilateral investment treaties (BITs). While that is commonly viewed as part of a backlash against the global investment treaty regime and particularly its investor-state dispute settlement mechanism (ISDS), this paper suggests that narrowing the scope of the host state’s substantive obligations, preserving regulatory autonomy and limiting the state’s exposure to investment treaty claims are not the only virtues which may arise from a state’s investment treaty renegotiation program. The program, and the resulting new treaties, can also be valuable in enhancing the internalization of investment treaties in the respective state as well as providing a better framework for the treaties’ implementation on a domestic level. The paper will thus elaborates on the notion, process and complexities of ‘internalization’ of investment treaties at a domestic level as one of the keys to understand how such treaties are implemented and observed as well as linking investment treaty renegotiation programs to internalization efforts.