Balance Between Investment Protection and Sustainable Development in BITs

The Example of Switzerland

In: The Journal of World Investment & Trade
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  • 1 Ecole Polytechnique Fédérale de Lausanne, Lausanne, Switzerland,

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The objective of this article is to examine how substantive and procedural rights granted to foreign investors by Swiss bits are gradually being balanced with social and environmental provisions. Switzerland has enjoyed a long bit practice, as it signed its first treaty with Tunisia fifty years ago. Swiss bits rely on the post-establishment model and include usual standards of treatment. From 1981, they also systematically provide for a dispute settlement mechanism for disputes arising between an investor and a host State. Since the Switzerland – El Salvador bit in 1994, sustainable development concerns have been expressly inserted in some Swiss bits, as well as in several recent free trade agreements. Provisions on this theme are however far from being systematic in Switzerland’s bit practice and essentially remain declaratory in nature. The trend towards wider inclusion of sustainable development provisions in bits still faces several practical and political challenges.

  • 35

    Dolzer and Stevens, supra note 11, p. 66.

  • 37

    Gattiker, supra note 26, p. 46.

  • 49

    Dolzer and Stevens, supra note 11, p. 99.

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