Daniele Gallo, Fernanda Nicola, The External Dimension of EU Investment Law: Jurisdictional Clashes and Transformative Adjudication (June 8, 2016). Fordham International Law Journal, Forthcoming. Available at SSRN
The external dimension of European investment law is part of a newly-acquired power that the Treaty of Lisbon conferred to the European Union (“EU”) in 2008. Even though scholars have long witnessed areas in which new powers require EU institutions to adjust to the gaps left in the Treaty, and Member States to overcome resistance created by the shift of power to the Union, the rate at which the global trade and investment architecture is evolving through the mega-regional Free Trade Agreements (“FTAs”) is unprecedented. Rather than assessing the role of the EU as a major global player, we explain how European lawyers, scholars and politicians are exploring internally the new investment competence, while at the same time reforming investment arbitration and proposing new systems of dispute resolution at the international level. The EU rationale to put forward transformative proposals for investment chapters included in the FTAs does not stem from the need to address global inequalities, but rather as the result of careful negotiations to safeguard the clashing of the autonomy of its legal order with international arbitration law. By mapping the challenges arising from the relationship between investor-State adjudication and the autonomy of the EU legal order, we identify the possible legal tools needed to overcome them. Moreover, while supporting the new judicial architecture put forward by the EU through an Investment Court System (“ICS”) for FTAs, rather than traditional Investor-State Dispute Settlement (“ISDS”) clauses, we propose greater engagement with State-to-State arbitration and further reforms for a truly transformative adjudication system addressing global inequalities created by the current investment regime.