Free trade agreements and international investments
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CADTM | 12-03-08
Free trade agreements and international investments
Author Hugo Ruiz Diaz
Freely translated by Anoosha Boralessa in 2015 for bilaterals.org
Developed countries see free trade treaties as forming part of a two-pronged strategy:
– to use international law to lay down market rules; and
– to give the appearance of legality to a system that allows States and their people to be exploited, robbed of their resources and wealth by excluding them from the international community and then legitimizing this exclusion.
Are we headed towards the construction of an alternative new legal order? In relation to the free trade treaties and to international investments. The relevance of the Calvo Doctrine today.
Introduction
International investments are governed by free trade treaties and by treaties on the protection and promotion of investments. Such treaties established and establish the exceptional turf for conflicts between powerful, developed countries and countries of the South that are developing, that are underdeveloped or that want to be known as such.
Jurists constructing theses to defend the Western Order and the interests of transnational corporations consider that we need to liberalize investment flow to allow the free establishment of transnational enterprises. In the same way and this is proof:
“the interest of the international economic community requires businessmen and businesses to be able to establish themselves, dismantle their operations and relocate to make profit …” [1].
This is a clear example of scientific and objective Western Positivism in its most absolute form.
The current rules on economic and trade issues effectively establish by force an anti – democratic international order. According to militant Western Jurists, such rules enable the construction of an international legal order that can put in place disorderly domestic legal orders.
Western jurists consider that we are fortunate today. This is because now, after the upheaval of the 60s and 70s, we may talk of a restorative step [2] that is consolidated through free trade agreements and investment protection treaties. And it is clear that in this process of global liberalization, if a government:
“… does not submit to the mandatory rules of the market … it will be considered as untrustworthy and rather hostile. Capital will then flow to other countries with a better reputation.” [3]
This is under the cloak of the supposedly objective, scientific, positivist Western Doctrine that deliberately conceals its ideological choices from the system [4] Paris September 2000.
In contrast, rather than producing a clinical, normative, objective and positivistic analysis bearing the mark of Kelsen, we state the key points of international realism, produced by the imposition of a single global social model: the loss of sovereignty which is clearly reflected in the free trade treaties notably investment protection treaties and FTAS known as WTO plus for a simple reason. Clauses and obligations are laid down in relation to investments, treatment of investments, investors, intellectual property rights and the privatization of natural resources, the protection of private property, free transfer of profits and others. Such rules go so much further and are more radical that the WTO rules.
With unparalleled cynicism, the OECD declares that:
“… private investment increases economic production, stimulates job creation, increases profits, and, in the case of international investment, allows the local diffusion of technological knowledge and business know – how, promoting domestic investment, particularly through linkages created with local suppliers. These positive effects greatly contribute to development and to the eradication of poverty ….” [5].
For the United States and developed European countries, multilateral treaties, bilateral and sub-regional free trade treaties and investment protection treaties, form part of a two-pronged strategy:
– to impose, through international law, market rules as the only viable framework for international social relations on a continental and global scale.
– to seek to legitimize an order where States and people are exploited, their resources and riches looted by international social exclusion that is legally organized. The essential structure that defined capitalism from the very beginning has been preserved. This is the private control of the means of production and unpaid work. However, it has the capacity to rebrand itself and transform. Capitalism follows foremost private profit. This is because private profit is at the heart of capitalism and makes the entire system function.
The unconditional defense of private property is a fundamental element of the system. It is expressed in international relations by legal structures that are compatible with it and serve to promote it. International law plays the role of enshrining property rights as sacred so that they are almost never compromised. It is thus that investors cannot:
“….be subject to any permanent or temporary measures that limit property rights”
as article 5 of the 1990 Morocco-Italy treaty relating to the promotion and protection of investments clearly provides.
This same logic is applied in the field of intellectual property rights which TRIPS describes like this:
“…intellectual property rights are private rights…”.
Even more clearly, article 41 of the TRIPS clearly provides that:
“1. Members shall ensure that their national legislation establishes enforcement procedures to respect intellectual property rights in accordance with this Part. They shall ensure that they allow efficient measures to be adopted against any action that infringes intellectual property rights that is referred to in this Agreement. This includes expeditious remedies to prevent infringements. It also includes remedies that establish efficient ways of dissuading further infringements. These procedures shall be applied so as to avoid creating obstacles to fair trade and they must provide safeguards against their abuse…”.
The current phase of globalization corresponds, on the one hand, to the needs and edicts of capitalism to expand continuously and, on the other hand, to find exit mechanisms from the crisis that began in 1973. These exits for capital require the reduction of labor costs, which affect workers and social fringe benefits.
That explains the direct, frontal attack launched against the State and public powers, against fiscal regulations, increasing taxes, labor protection and social security as well as other matters. Economic deregulation began in the 80s and promotes globalization. It develops inequalities. It made inroads on social policies and reduces well-being, gives primacy to the market place and gives international finance the status of a hegemon. Political and social needs bow in submission to demands of the economy and finance. Economic and financial needs are premised on the absolute nature of private property, first as a value that overrides all political, social, economic, labor, environmental and human rights etc..
In this neoliberal phase, capitalism mostly (though not exclusively) penetrates the underdeveloped or developing world. But from outside, capitalism eliminates any chance of such societies and their natives directing their own development. Capitalism destroys economic relationships both those being forged and those well settled. It sets up structures that promote the interests of dominant powers, distorting domestic social, labor and environmental structures.
Our working hypothesis of this role is as follows: just because we are living in a period where there are no viable alternatives to global capital, it can still be logically maintained that Latin America has supported a process that is seeking to establish a viable alternative. In this process, which is the fruit of the people’s struggle, international law plays an important role, legitimating the alternative process as the fruit of contradictions.
A. Preliminary Reflections
1. Brief Factual Analysis
Economic inequality best characterizes the world in which we live. Every country in the world puts up with inequality within its borders although some more than others. There is inequality in every country. This highlights that, despite the progress made in science, technology and economic growth, no meaningful steps have been taken to producing a fairer economic order. The inequality within the nation state however is blunted if one engages in an inter-national comparison. Economic inequality between states is truly scandalous when one considers the annual statistics that the UNDP Human Development Report produces.
A fifth of the world’s population lives in countries whose inhabitants cannot even pay for a cup of coffee a day and survive on less than a dollar a day; where children die because their families lack the means to buy for themselves a “mosquito net”. [6] The gap between rich and poor countries becomes wider; gut-wrenching inequalities are the true sign of our times. [7] It is also deplorable that the 500 richest people in the world have an income that is equivalent to 416 million of the poor and that, despite this extreme situation, 2.5 000 million people survive on less than two dollars a day. This is equal to 40% of the world’s population. [8] More than 850 million people, of which a third are children of a pre-school age, continue to live debilitated by the vicious cycle of malnutrition and hunger. [9]
According to CEPAL, 220 million people were recorded as living in poverty in Latin America in 2002. This is 43.4% of the total population [10]. This indicates how widespread extreme poverty is on the continent.[11] This situation contrasts with the economic euphoria that is revealed when developed countries declare policies and jurists and economists defend:
– Liberalizing international economic transactions;
– Establishing competitivity as the exclusive economic benchmark;
– Deregulating the labor market; and
– Increasing privatization of the public sector.
Protecting the “policy space” promoting human development is contrary to multilateral trade obligations. So such obligations conflict with our national and regional developmental strategies.
During the 1990s, in most Latin America countries, general industrial productivity decreased or remained constant and wages decreased. These countries include important exporters such as Mexico. The increase in industrial productivity was small and wages were frozen. [12]
The competitiveness of manufacturers in many countries in the region, appears to be further undermined by sharp depreciations of their currencies, notably in Argentina, Brazil and Peru. Foreign capital investment was almost negligible. Rather than contributing to development, [foreign investment] inhibited production and technological progress. According to the 2005 UNDP Report 2005 [13], the terms of exchange will continue to worsen, with Latin America being one of the regions the most affected. As this report highlights, this decline is also reflected in the external debt crisis [14] that shook the entire region [15] and compelled Latin America both to apply macroeconomic programs imposed by the IMF/WB [16] and to expedite liberalizing international trade under the aegis of the WTO.
As for trade agreements or free trade agreements both at the regional or bilateral level: these lay down obligations that even go much further than the WTO rules, particularly in areas of investments, services and intellectual property. [17]
It was also during the eighties and nineties that the majority of developing countries undertook broad ranging market driven reforms with the expectation that a better allocation of factors would be fundamental for their integration in a global economy. The Bretton Woods Institutions played a dominant and ill-fated role in this context, by [both] granting loans with macro-economic policy conditions attached, lifting trade barriers, and ordering countries receiving such loans to embark on privatizations. These programs were exclusively focused on market forces, promoting the interests of the countries of the North and their transnational companies [18].
2. Erosion of sovereignty and loss of state powers
Three key elements relating to sovereignty are:
– rights to resources and self-determination;
– excluding the application of national law;
– excluding and waiving the jurisdiction of national courts and replacing them with ICSID.
These elements are present in all sub-regional, bilateral free trade treaties and investment protection treaties. Furthermore, these agreements were characterized by legal fiction, by formal positivism. However, they could be reduced to a policy adopted by countries of the North to plunder and dominate.
It is easier to make the point with examples. According to art 5 of the Treaty between Spain and Bolivia, expropriation and nationalization are expressly prohibited. So too is any measure of a similar nature that produces equivalent or similar effects. [19] This same provision is found in art 4 of the Ecuador-Germany Treaty [20].
CAFTA contains the following provision:
“1/No party shall expropriate or nationalize a covered investment, whether directly or indirectly, through measures equivalent to expropriation or nationalization (“expropriation”) unless it is:a/ for a public purpose;
b/ carried out in a non-discriminatory manner;
c/ accompanied by prompt, adequate and effective compensation in accordance with paras 2 and 4; and
d/ in accordance with due process and art 10.52. Compensation shall:
a/ be paid without delay;
b/ be equal to the fair market value of the investment that has been expropriated immediately before the expropriation was carried out (“date of expropriation”);
c/will not reflect any change in value on account of the intention to expropriate, known prior to the date of expropriation; and
d/ be fully realizable and freely transferable…” [21]
Article VI of the Bolivia – US Investment Protection Treaty should be set out in full and it provides:
“Neither Party shall establish or shall enforce, as a condition for the establishment, acquisition, expansion, management, exploitation or operation of an investment that was undertaken (translator’s note: English version of treaty refers to covered investment), any requirement (including undertakings or promises that relate to granting an official permit or authorization that obliges:a/ reaching a certain level or percentage of local content, or buying, using or, in any way, preferring products or services of national origin or from any other internal source.
b/ restricting import of products or services needed to carry out the investment, according to a particular volume or value set by production, exports or profits in foreign exchange earnings.
c/ exporting a certain type, level or percentage of products or services on general terms or to a specific market region.
d/ restricting sales of products or services that the investment produced on the Party’s territory, in relation to a particular value or volume of production, exportation or profits in foreign currencies.
e/ to transfer technology, modes of production or other know-how to a national or company in the Party’s territory unless pursuant to an order, undertaking or promise that is enforced by a court or administrative authority or a competition authority to remedy an alleged or adjudicated violation of competition law; or
f/ to carry out a type, level or percentage of research and development in the Party’s territory”.
This implies that a State does not have the right to demand that a particular investment is made to further national development or that it is implemented in the general framework of public development policies. Still less does a State have the right to demand the transfer of technology or other techniques so that a country can benefit from advances in this field and with time can acquire greater independence.
Thus, a cursory analysis of these provisions indicates that any public development policy is severely compromised.
In addition, the notion of investments covers a broad field embracing virtually all sectors of the economy. Let us cite as an example, the Investment Protection Treaty between Bolivia and Spain. Art 1.2 defines this scope of investments as follows:
“2. “investments” means any type of investment activity by investors of a Contracting Party in the territory of another Contracting Party under its legislation specifically including but not restricted to it, the following:a/ moveable and immovable goods as well as other real property rights such as mortgages, pledges, usufructs and similar rights;
b/ shares, bonds, debentures and other forms of participations in companies;
c/ rights to monetary contributions and to any other contractual service of
economic value that is bound to an investment;
d/ intellectual property rights: industrial property rights such as trademarks, patents, designs and industrial designs; copyright and related rights; integrated circuits and plant breeders rights;
e/ rights to carry out economic and commercial activities, that are conferred by law or by virtue of a contract including concessions to explore, prospect, cultivate, extract or exploit natural resources.”
Another important point to highlight is the following: investment arbitration. Bilateral investment and promotion treaties – IPPAs - establish, together with other free trade treaties such as CAFTA, the US-Peru treaty, the USA-Colombia treaty, the US-Chile treaty, basic regulatory instruments that provide a legal framework for matters ranging from the freedom to exploit natural resources to intellectual property rights, ranging from the patenting of plants and other genetic resources.
These treaties form the basis for and guarantee investment protection.
This is principally because they provide and promote exceptional methods for resolving disputes between a State and an investor. [22] International arbitration has established a better solution catered to directly serving foreign investors to guarantee private property rights. Such rights have been coined by ICSID as “fundamental property rights.” [23] And this, as a writer on investments pointed out,
“thanks to the opening of the market and to the multiplication of investments, new rules will develop on dispute settlement that will grant investors direct access to an international arbitral tribunal” [24]
For example, art 10 of the Argentina – Spain IPPA provides:
“1. Disputes that may arise between one Party and an investor of the other Party in relation to investments as defined in this Agreement shall, as far as possible, be settled amicably by the parties to the dispute. 2. If a dispute as defined under para 1 cannot be resolved within six months from the date it was initiated, it shall be submitted, at the request of one of them, to the competent courts of the Party in whose territory the investment was made. 3. The dispute shall be submitted to an international arbitral tribunal in any of the following circumstances: a/ at the request of one of the parties to the dispute, when there is no decision on the merits, after 18 months has elapsed from the date on which the process was initiated as provided by para 2 of this article, or when such a decision has been made but a dispute still exists between the parties; b/when both parties to the disputes have agreed. 4. In the cases provided by para 3 above, where the parties have not agreed otherwise, the disputes between the parties, as defined under this article, shall be submitted, on mutual agreement, either to arbitral proceedings under the auspices of “Convention on the Settlement of Investment Disputes between States and nationals of other States” on 18 March 1965….”
Art IX.1. of the US – Bolivia BIT provides:
“ A national or a company that is a party to an investment dispute may submit it for settlement under one of the following procedures: a/ the courts or administrative tribunals of the Party that is a party to the dispute, or b/according to any procedure that has been already been agreed for dispute-settlement or c/ in accordance with the provisions of para 3 2 a Whenever a national or a company concerned has not submitted the dispute for resolution under para 2 subsection a/ or b/, and three months have elapsed from the date on which the dispute arose, the said national or company will be able to submit the dispute for settlement by binding arbitration: i. The Centre will be available….”
This implies that a foreign investor has the right, power and discretion to bring a direct action against the state before ICSID without needing to exhaust local remedies. This privilege is not conferred on citizens when they are [pitted against a State] trying to assert their human rights.
Furthermore, it should be stressed that decisions [rendered by such tribunals] are of direct effect and are not in need of enabling domestic legislation to be recognized and enforced by the Host State. Art 12.10 of the Venezuela – Canada Investment Protection Treaty is clear on this point:
“the arbitration award is final and binding. Each Contracting Party will provide for the enforcement of the award on its territory…”.
Through these clauses, the States and public powers have relinquished their right to submit such matters to the domestic legal order, thereby effectively waiving all control over their natural resources, trade and investments.
However, as discussed further on in this paper, a genuine process of re-democratization of international relations is unfolding in Latin America. Democracy is being restored and democratic rights are being exercised. But what is most important, sovereignty has been restored and with it, state powers reinstated. Before moving on to analyze these points, let [us pause and] consider briefly the international order and its ramifications for the function of the State.
B. Attempt to characterize of the socio – political and international legal order
1/ The changes in international law and international economic relations
The international order coincides with private interests
As Professor Robert Charvin declares, both the international order and domestic order can be characterized by seriously weakened legal regulation. [25] In fact, the contemporary international society operates on logic that is completely determined by “private powers” based in its turn on commodifying the human being, the entire international society and all peoples. [26] All people find themselves subject to legal rules because of radical changes in international law caused by major changes in the power relations between the main protagonists of history. This change is, at the same time, determined by the character of the actors, in their presence.
The power of the contemporaneous international society has fundamentally evolved as its composition has doubled. On the one hand, the private sector and large transnational firms have asserted their power through multilateral, regional or bilateral laws and rules. This is how the WTO rules were made to advance the interests of the private sector [27], all obligations being shifted onto States (Agreement on Intellectual Property Rights, Agreement on Services…). [28] The WTO is the main multilateral international organization with the remit of regulating de-regulation. [29] This is because it consists of agreements that range from the privatization of services to intellectual property rights…). This same trend may be noted in sub-regional agreements on free trade such as CAFTA and NAFTA, in the unsuccessful proposal for a FTAAs, in bilateral agreements like IPPAs. In the same manner, the multi-lateralization and exercise of power extends to international financial institutions the main activities of which consist of [setting up] privatization policies, privatizing public services and transferring such services to the private sector where their profitability is guaranteed.
As a general rule to which there are exceptions, the other component of power is traditionally concentrated in the hands of the State. [It would be more accurate to say] this power is actually concentrated in the hands of developed States of the North (ex G8, OECD, IMF & WB) which, in accordance with private interests, dictate neoliberal policies. But military power also has consolidated. Another way this consolidation manifests itself is through states being custodians of the neoliberal order.
Such states safeguard the protection of private power. They provide private power with an international legal regime aligned to their interests. Such states establish and reinforce new rules or adapt them to the new international situation. We are thus facing the establishment of a genuine, transnational power that has a mixed political-financial nature, bringing together transnational corporations, multilateral institutions (including the UN) and the public powers of developed countries.
The violence, the wars of aggression, re-structuring the constitutional aspects of the UN Charter, large-scale violations of human rights, war crimes and crimes against humanity are part of the formula that makes up the neoliberal order.
An essentially anti-democratic international order
In this scheme of things, international law (including its legal framework for international economic relations) has been subject to radical changes. Thus “classic international law” based on State sovereignty, equality of states, self-determination of people, non-intervention, all rules of a political nature, is literally being reconfigured and dismantled [30]. A new characteristic has emerged as a substitute premise: putting contract law at the heart of international law. Contract law and trade law are clearly reflected in agreements such as the WTO, regional or bilateral FTAs or Bilateral agreements such as IPPAs. The purpose of this commercialization is, in the final analysis, to allow a handful of transnational corporations belonging to Northern states, principally the US [32] to control the international economy [31]. On an ideological level, this change is principally expressed as “global governance”[33] the need of the international society reorganizing itself on the basis of work, carried out by states, civil society and private society collaborating together on a global scale, but which falls within a “single world market”.
At issue is an order dominated by the increasing marginalization of a number of developing countries. Marginalizing them and weakening them has led to increasing the gap between developed and poor countries [34]. As a UN Human Rights Commission report pointed out,
“…. The economic and political inequalities in the world are closely related to Western, in particular to North American globalization… without respect for other cultures or beliefs and governments and Western enterprises sell to others their own model of governance (democracy and the Rule of Law). It is not out of altruism that they do this but because this model produces economic advantages. Free trade helps the rich more than it helps poor countries. Legal regulation permits these transnational companies to function without taking great risks. Thus democracy is promoted in all parts (except if it produces independent governments and regimes) [35].
It is the international order that legally organizes the exclusion, just as it did in former colonial times and neo-colonial times.
To summarize, this marks the return to corporate law, a kind of feudal law (as opposed to international law) that is exercised exclusively in the interests of big transnational capital and rich states. Furthermore, this corporate law is accompanied by binding provisions to ensure that its rules are enforced. In fact, one of these devices is ICSID which has already been referred to earlier on in this paper.
It may be said that the international society coupled with its “new law” has an anti-democratic character because it confirms the might of the strongest under the semblance of the law. This observation explains why for some time now, the UN General Assembly, after a long period of silence, has declared the need for a fair and democratic order [36].
2. Transforming the role of the State and competences of public powers
At the end of the 80s and the beginning of the 90s the prescriptions of the Washington Consensus, with the implementation of policies and IMF and WB conditionality, led to the political and economic transformation of States in Latin America and the world. This was characterized by economic liberalization, the institutional reform of the State, deregulation and massive privatizations. In this context, international financial institutions played a prominent role. These institutions and the programs they elaborate and impose in the form of conditionality,
“….express a political project: a deliberate strategy of social transformation on a global scale. The main aim of this strategy is to transform the world into a big playground where transnational companies may act with complete security. In short, the structural adjustment programs (SAPs) act as a “correa de transmission” to facilitate globalization through liberalizing, deregulating and reducing the involvement of the state in national development.”
In other words, international financial institutions form part “of the neo liberal counterrevolution”. [37]
This indiscriminate opening was accompanied by drafting legal instruments, notably in matters of trade, investment, movement of capital, intellectual property, in accordance with objectives pursued in favor of large transnational companies, etc.
This process is characterized by abandoning the state’s social ordering function and replacing it with a politica de atracion – that almost always is devoid of careful choice, lacks the potential to control foreign capital [38] and fails to give credit to investment for development.
Protecting the rights of investors that operate cross border has been transformed into an issue of primary importance. This has also occurred in the WTO and its investment group. [39] With the expansion of the socio liberal model on the global scale with regional groupings, taken together with the entire process of globalization that establishes a global market that functions as both a social regulator and is subject to a process that it cannot challenge.
This offensive seeks above all, to drastically limit public authorities’ powers to make policies for the common good. The State and the public powers are now constrained, having to be accountable to the private sector and not to the citizenry. Big transnational corporations have all their rights and all freedoms guaranteed and yet are not subject to any countervailing legal obligations backed up by sanctions.
On the political ideological level, democracy is being attacked. Thus the state is required to be managed like a private company through “good governance”, terminology lifted directly from the regulation of transnational companies.
It is easier to see this in the context of the World Bank. According to this institution ( a specialized agency of the United Nations), the role of the State is to:
“develop the market through good regulation … and to ensure a good relation between the market and the State.” [40]
To safeguard the relationship between the State and the market, public authorities must prioritize the privatization of public services, because this is the only “…. evident solution”. [41] But the rationale or hypothesis for this is not given. It is evident, ineluctable, inescapable, that this is said without a basis.
Furthermore as the World Bank document points out,
“.. the State has a mediocre role before its essential tasks of :
– maintaining public order;
– protecting private property; and
– applying weak rules and policies. If a state fails to fulfill these essential functions, investors consider the State lacks credibility. This perception seriously damages both economic growth and investments”. [42]
Effectively, liberal globalization plays a part in breaking down the State, preventing it from guaranteeing social relations and democracy. As Professor Jean Salmon points out, state functions and public powers are reduced to
“… those of a policeman that safeguards freedom for a privileged minority who exploit others” [43].
It is also a fact which has an evidentiary basis that public authorities that comprise the State, must avoid any:
“… covert or collateral interference with the use of property that has the effect of depriving totally, or to a significant extent, the owner from using or deriving an economic benefit that one would reasonably expect from property ….” [44] as ICSID categorically confirmed.
The State is reduced to the bare minimum: the policewoman that guarantees an order identified largely with protecting investments of transnational corporations, protecting financial capital so that it is not fixed in place but freely circulates and guaranteeing that free trade agreements are fully effective. We are now faced with a real change of direction that is increasingly repressive to states. The public powers are thus established in “ambulance” states: [45]
To offset social and environmental catastrophes provoked by private economic policies, privatizations and common goods for the public [46], there is a State of compassion and of private charity. Latin America has not escaped this phenomenon.
3. International Instruments deployed to redefine role of the State
The signature and ratification of IPPAs and FTAs is a very common occurrence in almost all Latin American countries [47]. In fact, in the last decade, developing countries signed and ratified a large number of bilateral investment treaties with countries from the North, both among themselves [48] and as bilateral free trade treaties (Chile- USA, Peru-USA, Colombia – USA, etc) and regional treaties (CAFTA, NAFTA etc.).
Generally speaking the attack on democracy and public powers requests, in different ways, all state entities to decline to exercise some of their powers, especially those that relate in different ways to:
a/ the power to control the activities of SNTs [translators note: I am guessing that SNT means a transnational corporation]
b/ the power to control and regulate trade
c/ the power to control and regulate capital flows
d/ the power to control and regulate investments
e/ the power to implement policies of local development and environmental policies etc.
It should be stressed that in practice, this translates into a radical loss of national sovereignty. The State and consequently the governments and all state institutions, are limited to “managing private goods” and to guaranteeing their inviolability even at the cost of:
– human rights,
– environmental protection,
– independent national development and above all,
– eroding the right to legislate to exercise sovereign rights on the exploitation and management of natural resources.
It is easier to illustrate this through the vehicle of international instruments. Although it may appear tiresome, it is arguably a useful exercise to refer to these instruments in one section.
International instruments that most clearly preclude states from exercising their rights and powers are the Investment Protection Treaty and the Free Trade Treaty.
All IPPAs contain the following clauses:
1. a prohibition on expropriation and nationalization
2. the duty to provide fair and equitable treatment to investors
3. the duty to provide national treatment. This means prohibiting any public policy that injures the interests and rights of investors and private property (including those relating to subsidies, medications and foods etc).
4. obligations to amend all laws, regulations, administrative acts and other obligations that violate these agreements
5. waiver of the application of local law
6. waiver of the right to submit transnational corporations and investors to local courts.
This is the scheme that permits neoliberal policies to being indiscriminately accepted throughout the world. Above all, this scheme enables these policies to penetrate all states and all state authorities, ravaging their independent national economies, destroying the state’s provision of social protection and leading to serious social and environmental damage.
Let us consider this in more detail. Art III.1. of the US Bolivia Investment Protection Treaty provides as follows:
“Neither Party shall expropriate or nationalize directly a covered investment nor shall it do so indirectly by applying measures equivalent to expropriation or nationalization (“expropriation”) unless it is for the public interest, carried out on a non-discriminatory basis and accompanied by prompt, adequate and effective compensation in accordance with due process of law and general principles of treatment provided in para 3 of art II. Compensation shall be paid without delay, and shall be equal to fair market value of the expropriated investment immediately before the expropriatory act was taken (“the date of expropriation”) and will be completely effective and freely transferable”: /and as the OECD has rightly pointed out
“today, countries have a very positive attitude to foreign investment and this may be seen throughout the world. There has been a proliferation of bilateral agreements and other investment agreements that require prompt, adequate and effective compensation for the expropriation of foreign investment. This has deprived the word direct expropriation of its content [49].It should be noted that the clause covers more than expropriation and the abolition of legal title. It covers mere State interference with the use of this property or the benefits derived from it, without the state needing to confiscate or tamper with legal title. Such measures taken by a State can thus have an effect similar to an expropriation or a nationalization. That is, they can constitute an unchecked indirect expropriation that is essentially the same as an expropriation. [50]
As ICSID indicated:
“it is beyond doubt that regulations can be characterized as creeping expropriation... In fact, many creeping expropriations can be carried out through regulations. A global carve-out for regulatory measures would create a wide gap in the scheme for international protection against expropriation. [51]Furthermore,
“…regulatory administrative acts are inapplicable, even if they meet the requirement of public utility, (such as environmental protection measures) when, the negative economic impact of such acts on the net worth of the investment is so great that the value or economic or commercial utility of the investment is totally neutralized.”The logic is that
“measures to protect the environment can be considered as expropriatory measures that a State is taking to implement its policies. So where property is expropriated, even if this is by the application of environmental measures, the State must pay due compensation.” [52]According to ICSID, the same goes for mandatory measures:
“…for their nature, these too if they are deemed an expropriation and have that effect, will be deemed an indirect expropriation and will have an effect that is equivalent to expropriation. If such measures operate over a period of time, they may also be classified as progressive. It is also this Tribunal’s opinion that they are no different in kind from those classified as “indirect” expropriation or “tantamount to expropriation...” [53]Today these include political clauses seeking to guarantee and to legalize the policies of dominant States that breach international law. A good example is the US Uruguay Protection Treaty that provides:
“Art 17: Denial of Benefits1/ The United States may deny benefits of this Treaty to an investor of the other Party that is an enterprise of that Party and to investments of that investor, if persons of a non-Party country are the owners or control the enterprise and the United States:
a/ does not maintain diplomatic relations with the non-Party country; or
b/ adopts or maintains measures in relation to the non-Party country or a person of the non-Party, that prohibit transactions with this enterprise, or that would be violated or circumvented if the benefits of this Treaty were granted to the enterprise or its investors.
2/ A Party shall deny the benefits of this Treaty to an investor of the other Party that is an enterprise of the other Party and to investments of that investor if:
the enterprise does not engage in significant commercial activities in the territory of the other Party and persons of a non Party or persons of the denying Party are the owners or control the undertaking.This is the same as, for example, implicitly recognizing that sanctions against Cuba are legitimate and furthermore acts that constitute serious breaches of international law are legal. [54]
As UNCTAD rightly indicated, these arrangements involve:
“…the reduction of independent policy- making (as a consequence of) the undertakings that countries give in multilateral agreements…” [55]The situation described is very different from that period in history when Latin American countries and Third world countries were making passionate demands for their sovereignty and to exercise their power.
In Latin America, and also on the international plane with the emergence of the so called Third world countries, the assertion of sovereignty established the confirmation of the validity and of the current situation …
C/ Calvo Doctrine
We will briefly set out the doctrine for two reasons:
– first, because as a doctrine, it shows us that international law is a battlefield. International law reflects and materializes the correlation of forces (and fixes them) as the result of contradictions.
– Second, because it is surprising that today it is a thriving rule of international law.According to then contemporary doctrine emanating from dominant Western states, an offense committed against a foreign citizen also constituted a direct offence against the State of which the investor was a national. In such circumstances, the State had the right to obtain justice as it considered the most suitable: armed force was an option. Such states did not consider national law or national courts could provide an appropriate remedy. Dominant Western doctrine legally justified the right of direct intervention and the use of violence against Latin American states. It was in this historical context that the Calvo Doctrine was created. For the first time Latin American states restricted and tried to eliminate the constant danger of direct foreign intervention, chiefly on account of loans and the investments made by foreign citizens. Military interventions with their consequent use of violence [56] were a current practice and set up a sword of Damocles for the economic development of countries that had recently become independent.
In the 19th century, most Latin American countries were politically independent but politically unstable. It should be noted that they could neither develop nor fully exercise their sovereignty owing to foreign interferences in the form of diplomatic claims that European and North American investors were making. Such diplomatic claims were supported by international law chiefly built on contemporary European doctrines that conferred upon them the right to intervene and to use unlimited violence. This is typical of the legal structures neocolonialism sets up.
The Argentine diplomat and international jurist Carlos Calvo theorized and constructed the general principle that maintained that disputes between foreign citizens must be resolved by local courts and diplomatic intervention by the investor’s home state must be avoided. This new theory was developed in his book International Law: Theory and Practice, published for the first time in 1868.
The foundation of his doctrine rests on the principles and rules of national sovereignty, sovereign equality of states, that nationals and foreigners are equal before the law, all of which fall within the territorial jurisdiction, more precisely, the State’s territorial jurisdiction. Investments made by foreigners are also subject to national law. Where disputes arise, there are national courts that apply the law. The fundamental points are:
a/Sovereign states enjoy the right to be free from any form of interference or intermeddling by other States;
b/ foreigners have the same rights as nationals and, in case of disputes or claims, they shall be required to exhaust all legal remedies before the local courts. The State of which it is a national loses the right to protect and the right of direct intervention. [57]
It is logical that dominant countries reject and deny that this theory has any legal content.
The first case where the Calvo Doctrine was applied was in Mexico, a state that very often has had to invoke the doctrine to defend its national interests and its inherent sovereignty.
In 1873, the Mexican Minister of Foreign Affairs, Lafragua, sent a note to the North American ambassador Foster, claiming that on the basis of the doctrine developed by the Argentine jurist Calvo, Mexico was not responsible for damages caused to foreign property. Foster replied that Calvo was not an internationally accepted author [58]. Western countries had made this very clear. In the case at hand, the USA denied that the doctrine had any legal validity. Together with European countries, the US declared that it was fiercely opposed to it.
Before this, it must be emphasized that international Latin American jurists battled tirelessly and with a single-minded tenacity for Calvo’s ideas to be universally accepted and established as a binding legal norm of international law.
– The International Conference of the States of America or the Pan-American Conference 1889 – 1890 in Washington where all Latin American states participated (with the exception of San Domingo) provided a tremendous platform for the principles of Carlos Calvo. An ad hoc commission for the study of international law affirmed that national citizens and foreigners have identical rights and duties. So foreigners had to follow the same legal appeals as nationals.
– This recommendation was subscribed to by all the Latin American states except for Haiti that abstained. Naturally, the US delegation opposed. However the idea had already cemented in the minds of the South American jurists and diplomats that it was necessary to undertake this very important role.
– At each of the “Pan-American” meetings, the Calvo Doctrine was invoked in different ways, sometimes without being directly referred to.
– In the Second Conference of the City of Mexico (22 October 1901 – 31 Jan 1902), fifteen States approved a convention which provided that foreigners had the same civil rights that nationals enjoy and that they had to use them on strictly the same terms as nationals. And furthermore, States did not have nor did they recognize any other obligations or responsibilities than those owed to nationals as established under the Constitution and laws. [59] It must be highlighted that the Calvo Doctrine already had practical application in bilateral treaties many years before. [60]The result of the persistent struggle expressed in the interpretative works of Latin American jurists to recognize the Calvo Doctrine as an international legal norm: the so-called Calvo clause. It was introduced in agreements with foreign citizens (foreign investors). This clause required foreign investors – by virtue of the exercise of state powers - to first exhaust local remedies of dispute resolution. To this extent, the Calvo clause is a direct and logical consequence of the doctrine.
This is a brief summary of the principal points of doctrinal thought, which has and continues to have, considerable importance and influence in Latin American countries. Today it is more relevant than ever. The Calvo Doctrine represents the struggle between two schools, two doctrines and two practices that represented, and represent today, two distinct visions of the world: one of rich countries and the other of the poor countries of the South or the Third World.
A specific example in the application of the doctrine can be found in the 1969 nationalization of Gulf Oil that took place when the Government of Alfredo Ovando Candia was in power. The Decree-Law was proposed by Marcelo Quiroga Santa Cruz, the minister of Mining and Oil. The person who took control of the oil fields out of the hands of the oil company was General Juan Jose Torres.
The Decree states thus:
“Considering: That the Bolivian Gulf Company establishes a new Superstate, that has economic and political power superior to the State, incompatible with the principle and practice of national sovereignty.That the revolutionary Government has derogated from the Oil Code, legal regulatory laws on the exploitation of national hydocarbons, drafted by lawyers dependent on foreign private oil companies and that pushed the country, through pseudo nationalist governments, to guarantee the Bolivian Gulf company a margin of profits and impunity that seriously compromises the economic interest and national dignity….
Decree: Art 1: the reversion to the State of all concessions granted to the Gulf, and the nationalization of all establishments, buildings, means of transports, studies, plans, projects and all other property, without any exception.”
Then, as we were able to note, IPPAs and free trade treaties have successfully sidelined this international legal rule that correctly served to guarantee the self-determination of people, legal pluralism and more democratic international relations.
However, we can see un pas en arriere to the sources, principally in Latin America.
D. The process of recovery of state powers and democracy, are we headed towards the reconstruction of a new international economic and social order?
The recovery of national sovereignty, the full exercise of democratic rights, the complete recovery of all state powers are some of the clearer signs that are now sweeping across our continent. We are going to examine some of these events. However this examination is by no means exhaustive.
In 2005 the MERCOSUR countries checked radically the FTAAs. Venezuela denounced the free trade agreement of the group of three (Mexico, Colombia, Venezuela). In Bolivia, Ecuador and Venezuela, specific measures were taken to radically revise state contracts in Bolivia and Venezuela; the nationalization of telecommunications in Bolivia and Venezuela. In Uruguay, the public demanded that the control of water be returned to the public authorities.
In Peru, we witnessed an increase of popular and indigenous sectors in an alternative project. These were not defeated by anti-communist propaganda of hostile business sectors. The social crisis continued openly.
In Paraguay, the Executive sanctioned a Decree Law that declared that debt contractually owed to foreign private banks was void. This was the first time this had happened 50 years. The Paraguayan Senator adopted a law that provided hydrocarbon resources of the soil and the sub-soil were public property that were not capable of being appropriated.
In Nicaragua, the FSLN revolution confirms that there is an alternative to the neoliberal system prevailing in Nicaragua and the whole of Central America. There have been unprecedented regional mobilizations against the FTA known as CAFTA. The President of Ecuador expelled the representative of the World Bank, a decision unprecedented in the historical context of international financial institutions. The President Evo Morales announced that Bolivia, together with other ALBA countries, would withdraw from ICSID. President Hugo Chavez declared that his country would withdraw from the IMF and the WB and at the same time would construct an alternative Bank for the South. A government wishing to terminate its relationship with the IMF and the WB, has never before taken such action. It is significant that it happened when the influence of these institutions in Latin America had plummeted and they were in a deep crisis.
It is without doubt possible that such acts and others open new paths in hemispheric relations and international relations. This is principally a shift in power towards the people. History can be an important instrument in this field.
1/ The Historic Rejection of Western Capitalist Law
Regional plan
Following the Second World War, Latin American states have been looking for ways to exercise their self – determination. As a model for economic and political development through the coordination of policies between Latin American countries.
The UN Economic Commission for Latin America and the Caribbean (CEPAL), established in 1948, recommended pan Latin American economic integration. From the 1950s and 1960s CEPAL assumed a leading role on the basis of three interdependent elements:A. A deviation from the foreign economic policy aimed at improving the disadvantageous and marginalized situation of Latin America vis-à-vis the global economy, through a regional integration movement, reducing damage of “terms of trade” or terms of unequal trade. The underlying aims of the proposal are to permit Latin American markets to grow through integration and to try to find at the same time, a greater negotiating capacity within context of GATT 1947.
B. The model of import-substitution should push economic development through industrialization. For this reason, CEPAL tried through its organizations, to harmonize economic policies so as to integrate Latin American markets inter se (horizontal cooperation). This strategy was aimed at overcoming “traditional economic dependence” on industrialized countries, notably the United States.
C. The diplomatic component should strengthen its negotiating power on the international stage. In the 1960s, CEPAL acting through CECLA (a special commission for coordination), succeeded in articulating a common regional position through multilateral economic groupings, principally those relating to the US trying, as far as possible, to articulate new regional mechanisms to modernize the service sectors that can win the support and interest of a group of political and economic agents. To that effect, a strong relationship between Latin American countries was constructed through political channels representing the Third World at the international level. [61]
On the international plane
The debate on investments, control over transnational corporations and trade took on political features that were very important in the decolonization process and in strengthening States that recently gained their independence in the 60s and 70s. In this period, the so-called Third World countries managed, to change the rules of the games imposed by the Dominant West to some extent using international law as a vehicle.It was clear that the political independence of the former colonies or semi-colonies did not lead to economic independence. Developing countries were faced not only with a weaker economy; conditions of subordination [were attached to their membership of] economic supranational organizations. They also were, to some extent, financially, commercially and technologically dependent. Further, developed countries imposed an international legal framework on them. Third World Countries quickly understood that without economic sovereignty, the political independence that they had gained, would be simply illusory if the global market rules and customary international law deprived the people of their wealth in favour of foreign investors or prevented states asserting sovereignty over natural resources.
One response of Third World countries was to establish a United Nations Conference for Trade and Development in 1964 as an international agency to drive the assertion of public development policies. UNCTAD was specifically created to support the independent strategies of trade and development of the countries of the South. This was under the control of the public authorities as was the policy of substituting local production for imports coming from developed countries. Third World countries denounced the relationship of domination around which international law is structured as well as permissive, liberal international law that is indifferent and incompatible with the development of the people.
In fact, if the State cannot exercise the required level of control over investments, nor exercise its right over natural resources, nor control the activities of transnational companies, sovereignty is reduced to an abstraction. The countries of the South undertake to defend sovereignty energetically, striking at international norms and international relations. The key point goes to the assertion and jurisdizacion of permanent sovereignty over natural resources. From the Third World perspective, there are two advantages.
From the legal perspective, it was a question of using rules of interpreting the principles of UN Charter to affirm the fundamental attributes of sovereignty. It is equally through departing from the uniformity, fiction and formalism of Western imperial law and establishing heterogeneous and pluralistic rules. In the second place, the declaration of sovereignty over natural resources implies declaring rules, based on international law fundamentals, with a concrete content: the right to nationalize, the right to expropriate, the right to confiscate all foreign investment.
Similarly, this declaration of sovereignty is naturally accompanied by the right to control over investments and capital. These on the one hand must be subject to national laws and on the other hand must be admitted and permitted according to the requirements and needs of economic and social development of the people.
The consequences are huge. Now it is not the investors that determine when, how and where to invest, but public powers that decide. Similarly, new rules can be laid down to ensure that private property, such as Western countries consider, lose their sacred character like its claim to be absolute and supreme over all other rights. In summary, the countries of the South try to ensure the necessary freedom concerning the right to regulate economic and social aspects such as those public development policies. It was a massive shock for dominant countries accustomed to impunity, domination and traditional hegemony.
The UN General Assembly is going to be the privileged site of battle. We are going to analyze two different episodes that precisely define the evolution of the reassertion of sovereignty. One of the first structured responses was the Res 1803 (XVIII), 16 December 1962, entitled Permanent Sovereignty over Natural Resources. The other, in the context of the general offensive and the retreat of Western countries, and the reassertion of a New International Economic Order, is expressed in Resolution 3281 (XXIX) of 12 December 1974 entitled Charter of the Economic Rights and Duties of States.
The Resolution 1803
Resolution 1803 interprets the UN Charter so as to gives a specific content to sovereignty, as affirmed by art 2 of the Charter. As such, the legal basis for the Resolution is rooted in customary [international] law. The Resolution contains various provisions that directly related to IPPAs and FTAs: conditions relating to the authorization of capital; applicable law, competent jurisdictions in case of disputes, the supremacy of the public interest over private interest and private property and the affirmation of the right to exercise full and complete exercise of state powers.One of the important points is number 1 which strongly asserts:
“… the right of the people and the nations to permanent sovereignty over their wealth and natural resources…”It also determines how natural resources should be exploited in the specific context. In this respect, its exploitation:
“must be exercised for national development and for the well-being of people of the respective state.”Number 2 established that the exploration, development and provision of these resources as well as the import of foreign capital to achieve them, must conform to the rules and conditions that peoples and nations freely consider necessary or desirable to authorize, limit or prohibit these activities. And it is rounded off by number 3 that where authority is granted, capital introduced and its increases shall be governed by the national law in force and by international law. One essential aspect of sovereignty is reflected in number 4 that establishes the following:
“… nationalization, expropriation and confiscation shall be founded on reasons and motives of public interest, for security and national interest, which are recognized as superior to both individual or private interest both foreign and domestic. In these cases, the State shall pay the owner the appropriate compensation due, in accordance with the rules that are in force in the State that adopts these measures exercising its sovereignty and in accordance with international law. In any case, where a dispute arises as to compensation, the foreign investor must exhaust the local remedies of the State that adopts these measures. However, in agreement with Sovereign States and other interested parties, the dispute shall be resolved by arbitration or international judicial resolution. Foreign [Translator’s note: sentence incomplete in the original text]”This act was followed by a Declaration on Social Progress and Development, Resolution 2542 (XXIV), 11 December 1969, that reaffirms entirely the rules set out in Resolution 1803.
The Charter of the Economic Rights and Duties of States
The Charter emerged in the context of the reestablishment of a New Economic International Order that formed part of the search for alternative development paths, and confirmed that States and governments have the right to fully exercise their powers in respect of economic, social, financial and trade matters. Resolution 3201 May 1974 expressed its determination to work with urgency to establish a New Economic International Order based - hear me well:“in equity, sovereign equality, interdependence, the common interest and cooperation between states regardless of their economic and social systems, that will correct inequalities and make amends for injustices between developed countries and developing countries and guarantees to present and future generations, peace, justice and economic and social development that accelerates at a sustained pace.”The Charter contains a fundamental principle of international law that:
“each State has the sovereign, inalienable right to choose its economic system. Similarly States have the right to choose their political, social and cultural systems in accordance with the will of the people, without foreign interference, coercion or threats of any type”.Each State, as expressed in art 2 of this Charter:
a/ regulates and exercises authority over foreign investment within its national jurisdiction and in accordance with its laws and regulations in accordance with its national objectives and priorities; and
b/ regulates and supervises the activities of transnational corporations within its jurisdiction and takes measures to ensure that such activities comply with its laws...”Art 2 c/ confirms the right of States to nationalize properties and national resources that they find in the hands of foreign investors and also proposes to create cartels for the production of raw materials. [translator’s note: the proposal to contain create for the production of raw materials is not contained in art 2 ©]
The Charter goes further than Resolution 1803 in the following sense. Resolution 1803 concedes that in the event of expropriation or nationalization or any other act of dispossession of private property of the investor, the State shall pay to the owner compensation in accordance with the laws in force of the State that adopts these measures in exercise of its sovereignty and in accordance with international law.
In contrast, the Charter declares that in such cases, compensation will be made in accordance with the domestic law of the State that has taken the measure and by national tribunals. Only after this, can it finally have recourse to international arbitration.
However, we know, the alternative plan of Third World countries collapsed in a spectacular failure.
2/ The Revival of the Calvo Doctrine
In this context, a state act that more clearly marks a return to implement the Calvo Doctrine is Supreme Decree no 28701, 1 May 2006. Art 1 declares as follows:
“ In the exercise of national sovereignty, in obedience to the mandate of the Bolivian people as expressed in the binding Referendum of 18 July 2004 and in strict application of constitutional principles, hydrocarbons, the natural resources of this country are nationalized. This State is recovering its property, its possession and its total and absolute control of these resources.” [62]Therefore, it is unambiguously recalled:
“… in accordance with art 24 and 135 of the Political Constitution of the State, all undertakings established in the country are considered nationals and are considered subject to the sovereignty, laws and authorities of the Republic authorities.”On these facts, this Decree implies the implicit waiver of the investment protection agreements without substantially modifying its provisions. Indeed, even when Evo Morales announced on 30 April 2006 his intention to denounce the Washington Convention of 1965, enterprises established in the country are subject to the sovereignty, laws and authorities of Republic. This implies the denunciation of ICSID as the preferred dispute settlement mechanism. International arbitration acquires a totally new meaning: it is subordinate to the national courts and supplements them. It is not a substitute for them, as ICSID purports to be.
We were able to superficially analyze the political scope of the initiatives and the extremely important acts. However this is not enough. The IPPAs and the FTAs are substantially incompatible with a process of recovery and a process of socio-politico-economic integration. And for this reason, the governments should denounce clearly inter alia:
– the Washington Convention of 1965,
– the waiver or radical revision of clauses of all IPPAs concerning the right to regulate and control investments, the right to apply national laws, and
– the right to expropriate and to nationalize – not as residual or exceptional power as is the case etc.Equally it demands the revision and scrutiny of all the state contracts. If such contracts conflict with the domestic order, they must be declared null.
Final reflections
From the outset, it must be said that if Latin America is experiencing a privileged moment in history in its efforts to reconstruct the international order, it is due to the struggle of its people and the victories that they have achieved. The Summit of the People 2005 explicitly expressed its support for reforms implemented in Latin America and the implementation of alternative regional instruments to push forward alternative processes of regional integration (ALBA). [63]The Declaration of the Summit also recalls that any agreement between nations must start from principles based on respect for human rights, the social dimension and respect for sovereignty, complementarity, cooperation and solidarity.
It should also take into account economic asymmetries in favor of countries that are less developed. Accompanying this process, MERCOSUR moves from being a classical, neoliberal free trade area to more of a socio-political grouping that, in addition to other initiatives, seeks to promote a new framework for regional cooperation. The deep crisis in which this regional grouping was immersed does validate this at all. At the same time, we have seen signals, principally from Venezuela, to move from an offensive diplomatic policy aimed at reconstructing South-South cooperation and alliances. And at the regional level, we have seen energy treaties and others concluded outside the context of the WTO, BITs and other free trade treaties.
To summarize, our Association is witness and participant at a unique moment of history, that is consistent not only with the reinstatement and recovery of national sovereignty but principally in the search for the construction of an alternative model.
I conclude with this: our Association, must play an active role as an institution in the struggle to transform and bring to the people and democratic governments on their path of transformation, its powers, the doctrinal struggle, the struggle for legal- political and ideological construction of the legitimacy of this unique process. Above all, in this process of recovering the people’s right to self-determination it must contribute to the revival and reaffirmation of the Calvo Doctrine. And logically, to support to an alternative process, called ALBA and others.
Our Association must reaffirm firmly and forcefully the need to reestablish radically the international order that in its turn demands the following:
a/ the right of all the people to freely determine, including the right to determine freely, the political condition and obtain freely its economic, social and cultural development;
b/ the right of the peoples and the nationals to the permanent sovereignty over their wealth and natural resources;
c/the right of all human beings and all people to develop;
d/ the right of all people to peace;
e/ the right to an international economic order based on participation on equal terms in the decision-making process, interdependence, mutual interests, solidarity and cooperation between all states;
f/solidarity is a fundamental value which should be applied when addressing global issues so that costs and expenses can be distributed fairly in accordance with the fundamental principles of equality and social justice. Keen regard should be paid to ensure that those who suffer or benefit less, receive the help of those that benefit more.
g/the promotion and strengthening of transparent international institutions that are democratic, fair and accountable and that have undergone a root and branch overhaul.This translation has not been reviewed by bilaterals.org nor any other organization or person.
Publicado por CADTM
Notas:
[1] Carreu D., Droit international Economique, Paris, 2005, p. 380.
[2] Carreau D., Op. cit., p. 381.
[3] Walde Thy. , Nouveaux horizonts pour le droit internatinal des investissemnts dans le contexte de la mondialisatin de l’économie, Paris, 2004, p. 14.
[4]Véase también Pierre Noël, La constitutionalisation du régime juridique international des investissement pétroliers et la (re)construction du marché mondial, Institut d’économie et de politique de l’énergie
[5] Organisation de Coopération et de Développement économiques, Cadre d’action pour l’investissement, Paris, 2006, p. 7. Véase también, Codigo de liberación de capitales cuyas disposiciones tienen fuerza obligatoria para los miembros. OCDE, Paris, junio 2006.
[6] PNUD, Rapport sur le Développement humain, 2005, p. 20. .
[7] Ibid.
[8] Ibid.
[9 PNUD, Rapport sur le Développement humain, 2005, p. 82.
[10] Comisión Económica para América Latina y el Caribe (CEPAL). Panorama Social de América Latina, 2002-2003.
[11] PNUD, Rapport sur le Développement humain, 2005, p. 28.
[12] CNUCD, Informe sobre el comercio y el desarrollo, La acumulación de capital, el crecimiento económico y el cambio estructural, UNCTAD/TDR/2003, Ginebra, 2003, p. 29 y ss..
[13] UNCTAD, Trade and Development, Report, 2005, p. 92.
[14] PNUD, Rapport sur le Développement humain, 2005, p. 25.
[15] UNCTAD, 2005, Op. Cit., p. 93-94.
[16] CDH-ONU, Effets des politiques d’ajustement structurel et de la dette extérieure sur la jouissance effective de tous les droits de l’homme, en particulier des droits économiques, sociaux et culturels, Rapport de M. Bernards Mudho, expert indépendant, sur les effets des politiques d’ajustement structurel et de la dette extérieure, E/CN.4/2003/10, 23 octobre 2002.
[17] PNUD, Rapport sur le Développement humain, 2005, p. 28..
[18] Véase, CNUCED, Études de la CNUCED sur les politiques d’investissement international au service du développement, Chapitre 2, New York et Genève, 2005.
[19] Ver también tratado de protección inversiones Bolivia- UK, artículo 5. Para una profundización del tema de las inversiones en América latina y una visión global de las privatizaciones recomendamos CEPAL, La inversión extranjera en América Latina y el Caribe, Informe 2004.
[20] Véase también articulo 5 Ecuadro Inglaterra.
[21] El artículo 10 del tratado de libre comercio entre USA Y Perú es una copia fiel de esta disposición.
[22] Los datos sumamente útiles suministrados por el Centro de Arreglo de Diferencias relativas a Inversiones -CIADI- en sus informes anuales son claros al respecto. En estos informes se refleja el hecho del número impresionante y la proliferación de demandas introducidas por los inversores extranjeros contra los Estados, principalmente contra Estados del sur. El CIADI es una institución arbitral que fue establecida por el Convenio de Washington, de 18 de marzo de 1965, sobre arreglo de diferencias relativas a inversiones entre Estados y nacionales de otros Estados. El CIADI es miembro del Grupo del Banco mundial y su presidente es el del Banco Mundial, actualmente Paul Wolfowitz. El CIADI se sustituye a los tribunales nacionales y a las leyes nacionales. El CAIDI aplica el derecho internacional de las inversiones e interpreta y aplica las normas liberales. Sus decisiones no pueden ser recurridas y son de ejecución obligatoria, substituyéndose así a la fuerza ejecutiva de sentencias dictadas por jurisdicciones nacionales. La ejecución de sus de laudos arbitrales son directas. Véase sobre el arbitraje BROCHES, A.; “Convention on the Settlement of Investment Disputes between States and Nationals of Other States, Explanatory Notes and Survey of its Application”, Y.B.Com.Arb., Vol.18, 1993, pp.627 y ss; FERNANDEZ MASIA, E.; Arbitraje en inversiones extranjeras: el procedimiento arbitral en el CIADI, Valencia, Tirant lo Blanch, 2004; HIRSCH, M.; The Arbitration Mechanism of the International Center for the Settlement of Investment Disputes, Dordrecht, Martinus Nijhoff, 1993; SCHREUER, C.; The ICSID Convention: A Commentary, Cambridge, Cambridge University Press, 2001; VIVES CHILLIDA, J.A.; El Centro Internacional de Arreglo de Diferencias relativas a Inversiones (CIADI), Madrid, McGrawHill, 1998.
[23] CIADI- CMS c. Argentina, Caso ARB/01/8, Laudo 12 de mayo de 2005, 262. .
[24]Dumberry P., L’entreprise, sujet de droit international? RGDIP, janvier-mars 2004, vol. I, 2004, p. 112
|[25] Charvin R., «Régulation juridique et mondialisation néolibérale, droit mou, droit flou et non droit», Actualité et Droit International, janvier 2002, p. 3.
[26]Cf. Benchikh M, Charvin R., Demichel F., Introduction critique au Droit international public, Collection Critique du droit, Presse Universitaires de Lyon, 1986, p. 12.
[27] Consultar, Carreau D., Droit international économique, Dalloz, Paris, 2004.
[28] 1Cf., Salmon J. « Le droit international à l.épreuve au tournant du XXIè siècle. in Cursos Euromeditarraneos Bancaja de Derecho international, vol. VI, 2002, p. 212 y ss..
[29] Ver, Albala N., «L’ONU et le triumvirat FMI/BMOMC », in ONU, droit pour tous ou droit du plus fort? CETIM, Genève, 2005, 141-147.
|[30] Véase, Mendes-France Fanon M., Ruiz Diaz Babluena H., Réflexions sur les mutations du droit international, CEDETIM, agosto 2005.
[31] Véase, Ruiz Diaz Balbuena H., L’accord bilatéral sur les investissements entre les USA et l’Argentine ou la démission du pouvoir public en faveur des multinationales, CADTM, abril, 2003.
[32] Jaguaribe H., «América Latina y los procesos de integracion» in Libre comercio. Mitos y realidades, Acosta Alberto y al., Quito, 2004, p. 66
[33]Véase, Mendes-France Fanon M., Ruiz Diaz Babluena H., La dégradation généralisée du droit international, CADTM, septembre 2005.
|[34] AG-ONU, resolución 57/274, Rôle de l’Organisation des Nations Unies s’agissant de promouvoir le développement dans le contexte de la mondialisation et de l’interdépendance, 5 de marzo 2003.
[35] CDH-ONU, La mondialisation et ses effets sur la pleine jouissance des droits de l’homme, Rapport final présenté par J. Oloka-Onyango et Deepika Udagama, E/CN.4/Sub.2/2003/14, 25 juin 2003, § 9.
[36] AG-ONU, Résolucion 56/151, Promotion d’un ordre international démocratique et équitable, 8 febrero 2002.
[37]ONU-CDH, Effets des politiques d’ajustement structurel sur la jouissance effective des droits de l’homme, Rapport de l’Expert indépendant Fantu Cheru, E/CN.4/1999/50,, A. L’ajustement structurel et la contre-révolution néolibérale, 28 - 30 28 - 30.
[38] Daly H.A., « Problemas con el libre comercio internacional. Perspectiva neoclásica y de Estado estable»in Acosta Alberto y al. Los mitos del libre comercio, Quito, 2004, p. 57.
[39] La Conferencia Ministerial de Cancún, desarrollada en septiembre de 2003 tuvo en su agenda el establecimiento mediante consenso, del modo en que habrían de conducirse las negociaciones en esta materia, las que deberían concluir a más tardar para enero de 2005. Punto 20 de la Declaración de la Conferencia Ministerial de Doha, WT/Min01/DEC/1.
[40] L’Etat dans une monde en mutation, Rapport de la Banque Mondiale, Washington, 1997, p. 6.
[41] Ibid., p. 7.
[42] Ibid. p. 5.
[43] Salmon J., « Le droit international à l’épreuve au tournant du XXIè siècle” in Cursos Euromeditarraneos Bancaja de Derecho international, vol. VI, 2002, p. 300.
[44] CIADI, Metalclad c. México, Laudo, 103.
[45] Charvin R., L’investissement interational et le droit au développement, L’H, paris, 2002, p. 60
[46] Ibid.
[47] Véase, Ruiz Diaz Balbuena H., Tratados de Promoción y Protección de las Inversiones (TPPI): PISTAS DE REFLEXION SOBRE ALTERNATIVAS EN VISTAS A LAS NECESIDADES DEL DESARROLLO ECONOMICO SOCIAL DE LOS PUEBLOS, ,( I) junio 2005 ; Los tratados sobre promoción y protección de las inversiones y la República Bolivariana de Venezuela: los riesgos de hipotecar el desarrollo económico, la revolución bolivariana y la democracia participativa, II, Los tratados sobre promoción y protección de las inversiones y la República Bolivariana de Venezuela: los riesgos de hipotecar el desarrollo económico, la revolución bolivariana y la democracia participativa III, julio 2005.
[48] Tomemos los casos de Argentina que ha ratificado 54 TPPI firmados con Estados Unidos, Francia, Canadá, España, Italia, Alemania, Portugal, Gran Bretaña e Irlanda del Norte, República Helénica, India, China, Senegal, Corea, Malasia, Túnez, Marruecos, Egipto, Israel, México, Argelia, Argelia, Armenia, Australia, Austria, Bolivia, Bulgaria, Chile, Suiza, Costa Rica, Cuba, Ecuador, El Salvador, Filipinas, Finlandia, Guatemala, Hungría, Croacia, Polonia, Indonesia, Jamaica, Luxemburgo, Nicaragua, Nueva Zelanda, Países Bajos, Vietnam, Sudáfrica, Suecia, Dinamarca, República Checa, Panamá, Perú, Venezuela, Rumania, Turquía. Brasil ratificó los TPPI firmados con Ecuador, Francia, Hungría, Corea, Países Bajos, Perú, Rumania, Suiza y Reino Unido. En todos los casos, es el Tribunal arbitral del Banco Mundial el que decide sobre la compatibilidad de políticas argentinas con respecto a las obligaciones contraídas como consecuencia de la firma de dichos tratados. Argentina tiene actualmente mas de 35 demandas ante el CIADI por parte de sociedades trasnacionales
[49] OECDE, L’expropriation indirecte et le droit de réglementer» in Le droit international de l’investissement. Documents de travail sur l’investissement international, Numéro 2004/4, p. 1.
[50] Ibid., p. 3-4.
[51] Centro Internacional de Arreglo de Diferencias Relativas a Inversiones, Marvi c. Méjico, Caso Nº ARB (AF)/99/1, Laudo, 16 de diciembre de 2002, 110.
[52] Centro Internacional de Arreglo de Diferencias Relativas a Inversiones, Técnicas Medioambientales TECMED S.A.c. Estados Unidos Mexicanos, Caso No. ARB (AF)/00/2, Laudo, 29 de mayo de 2003, 121. Ver también, International Centre for Settlement of Investment Disputes, Arbitration between Compañía del Desarrollo de Santa Helena, S.A. and The Republic of Costa Rica, Case No. ARB/96/1, 71 y 72.
[53] Centro Internacional de Arreglo de Diferencias Relativas a Inversiones, Marvin c. Méjico, Caso No. ARB(AF)/99/1, 16 de diciembre de 2002, 101.
[54] Véase Ruiz Diaz Balbuena H., Le traité de promotion et protection des investissements Uruguay USA et les négociations commerciales bilatérales entre les Etats-Unis et le gouvernement uruguayen : les enjeux, enero 2006, disponible en www.cadtm.org.
[55] CNCED, INFORME SOBRE EL COMERCIO Y EL DESARROLLO, 2006, PANORAMA GENERAL p. 16..
[56] E. Turlington, Mexico and her foreign creditors (New York, 1932), pp. 116 - 117, 141. A. Blumberg, The diplomacy of the Mexican Empire. 1863 - 1867 (Malabar, R. Krieger Publishing Co., 1987), pp. 12 - 20.
[57] Para un estudio de fondo ver, S. Mendoza, La Doctrina Cárdenas, Texto, antecedentes, comentarios, la Doctrina Monroe, la Doctrina Drago, la Doctrina Calvo, la Doctrina Cárdenas México, Ediciones Botas, 1939..
[58] C. Sepúlveda - A. Martínez Báez - A. Gómez robledo, Carlos Calvo, Tres ensayos mexicanos (Tlatelolco, México D.F., 1974), p. 29.
[59] Véase, D.R. Shea, The Calvo Clause, op. cit. pp. 76 - 77. C. Sepúlveda Gutiérrez, La responsabilidad internacional del Estado y la validez de la cláusula Calvo (México D. F., Facultad de Derecho y Ciencias Sociales, 1944), pp. 27 - 38.
[60] Véase por ejemplo artículo 21 del tratado de amistad, comercio y navegación entre Colombia e Italia ratificado el 10 de agosto de 1894.
[61] Rapoport M, Op. Cit., p. 106.
[62] Véase Ruiz Diaz Balbuena H., En défense des nationalisations en Bolivie : l’actualité des règles internationales, des politiques des nationalisations et du contrôle des activités des transnationales, 2006, Ruiz Diaz Balbuena H., Le Décret de nationalisation en Bolivie: ses fondements en droit international, agosto 2006; disponibles en www.cadtm.org, www.nizkor.org.Igualmente Ruiz Diaz B., H., Le Décret de nationalisation en Bolivie: ses fondements en droit international, agosto 2006. .
[63] III Cumbre de los pueblos de América Latina, Mar del Plata, Argentina, Noviembre 1 al 5, 2005, punto 3.í
