The Allocation of International Responsibility in the Context of Investor-State Dispute Settlement Mechanisms Established by EU International Agreements

Abstract:

The present paper addresses the problem of determining who, between the EU and its member states, must bear international responsibility for the treatment afforded to a foreign investor. The main issue in this respect appears to be whether, under international law, the way in which competences are distributed between the organization and member states may be a criterion for the allocation of international responsibility. It is submitted that the view that international responsibility should correspond to competence is not generally accepted in international practice.

The existence of a special rule of attribution applicable to the EU is also doubtful. Whatever the solution to be given to such problem under general international law, however, the allocation of international responsibility between the EU and its member states will mainly depend on the legal regime established by future investment treaties, or by trade agreements with investment chapters, that the EU will conclude with third states. In this respect, by leaving to the EU the decision as to who will act as the respondent, the investor-state dispute settlement mechanism established under the draft text of CETA will permit to the EU to foster a competence-based approach to the problem of allocating international responsibility.

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