Performance requirement prohibitions in international investment law

Abstract

Performance requirements act as policy instruments for achieving broadly-defined economic and developmental objectives of States. A number of States have committed to prohibiting performance requirements in international investment agreements (“IIAs.”). Performance requirement prohibitions (“PRPs”) are meant to eliminate trade-distorting performance requirements and performance requirements which replace investor decision-making by State decision-making.

This dissertation focuses on providing answers to two research questions: first, how do States prohibit performance requirements in IIAs? And second, how should PRPs in IIAs be interpreted and applied?

For the first time, this dissertation: proposes a unitary understanding of PRPs in IIAs; develops a detailed typology and analysis of PRPs in IIAs through the identification of systematically reproduced drafting patterns; conducts the first critical and in-depth analysis of all arbitral awards which have decided claims based on PRPs in IIAs; analyses interpretation and application issues related to provisions that exempt government procurement from PRPs and to reservations that shield sensitive non-conforming measures or strategically important sectors from PRPs; and anticipates the application of most-favoured nation (“MFN”) treatment clauses to PRPs in the future. Finally, this dissertation formulates proposals that can help interpret and apply existing PRPs and draft future PRPs in a more deliberate and informed way.