International Investment Agreements Policy Space

Investment agreements or investment chapters in trade agreements (AI) concluded by states – in a bilateral, regional or international environment – can undermine companies` respect for human rights in different ways. In addition to limiting the legal or political leeway available to states to regulate investor behaviour, AI can also undermine the right of the communities concerned to seek effective remedies against investors in the event of project-related human rights violations. How could states maintain such domestic policy flexibility? Building on the work of UNCTAD and others in this area, the Working Group aims to unpack the impact of Principle 9 on the three pillars of the United Nations Group and to provide states with concrete directions to better deal with the adverse effects of AI on human rights. Principle 9 of the UN Guidelines for the Economy and Human Rights therefore reminds states to “maintain sufficient leeway to fulfil their human rights obligations when pursuing political objectives related to business with other states or companies, for example through investment or investment contracts.” The 2021 Working Group`s report to the UN General Assembly will focus on providing states with practical guidelines for negotiating human rights-compliant IDAMIT, in accordance with undaunted secretaries-general. The report will cover all three pillars: the obligation for states to maintain regulatory space in AI negotiations, in order to strike a balance between attracting investment and promoting responsible trade conduct; The responsibility of investors to respect all internationally recognized human rights; and the role of the IIS in providing remedies to individuals and communities involved in investment-related projects. In its October 2017 report to the UN General Assembly (A/72/162), the working group stressed that “effective remedies for business-related human rights violations could be sought in various areas… and that the negative effects of … Dispute resolution under trade or investment agreements relating to access to effective remedies within the framework of the United Nations should be managed. The report also recommends that “States conduct a full and transparent assessment of the impact on human rights prior to the conclusion of trade agreements and explicitly enshrine human rights provisions in these agreements, in order to maintain adequate political flexibility to meet their human rights obligations.” In March 2019, the working group and other UN experts joined other UN experts to raise concerns about the ongoing work of Working Group III on Investor-State Dispute Resolution Reform (IRDD). The 2021 report will build, among other things, on the previous work of the working group examining the different dimensions of the interface between iZUR and human rights.