The strategic use of sustainable development to adequately address social and environmental issues in disputes involving transnational companies
- Autores: Sebastián Preller Bórquez
- Directores de la Tesis: Angel José Rodrigo Hernández (dir. tes.)
- Lectura: En la Universitat Pompeu Fabra ( España ) en 2020
- Idioma: español
- Tribunal Calificador de la Tesis: Carlos Espósito Massicci (presid.), Antoni Pigrau i Solé (secret.), Elisa Morgera (voc.)
- Programa de doctorado: Programa de Doctorado en Derecho por la Universidad Pompeu Fabra
- Materias:
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- Resumen
I would like to state that the research objective was to examine the extent to which sustainable development could be used in international litigation in order to integrate social and environmental concerns into disputes brought by transnational companies against public authorities before international adjudicative bodies. This objective aimed to show the extent to which the determination of the responsibility and liability of the parties could be affected if sustainable development could prove to be successfully integrated within international adjudicative processes.
Through the analysis of the developments in international policy and further elaborations made upon the concept of sustainable development in international adjudication, this study argued for the existence of two main narratives grounded in the core of sustainable development: a narrative of balance or integration between the three elements of sustainable development, and a narrative of prevention or mitigation of the adverse impacts of economic development upon social development and the environment. Accordingly, the study supported that the role of the sustainable development narratives of balance and prevention within international law was to inform the application of international norms and obligations in order to align them with the global interest that sustainable development represents.
In this sense, to address the strategic use of sustainable development is novel to the extent that this angle implies a twist on the practical reach of a concept that was originally created to prevent the potential environmental damages that so-call developing countries may cause in their way to achieving economic development.
As it can be observed, despite of the academic nature of this research, it is also highly relevant from a practitioner’s viewpoint as it deals with practical issues arising in international, field-specific litigation. Indeed, the study develops a novel theory on the effects that sustainable development narratives of balance and prevention may have within disputes arising in the fields of deep seabed mining beyond national jurisdiction and foreign investment, exploring the extent to which these narratives may influence the determination of the responsibility and liability of public authorities brought before international adjudicative bodies by private entities claiming to have suffered the violation of their rights as conferred by the international legal system. The research also advocates for sustainable development narratives of balance and prevention to have a role in the determination of the amount of compensation owed to private entities in case the liability of the public authority is ascertained. Indeed, it is argued they may nourish the legal reasoning concerning the application of the contributory fault standard in both deep-seabed-mining- and foreign-investment-related disputes.
Particularly, concerning Part I, deductive reasoning was applied upon primary sources of international law to reach the findings therein. Primary sources consulted in this Part range from international treaties and resolutions of the United Nations General Assembly related to sustainable development, to the analysis of the jurisprudence of international adjudicative bodies on the same topic. The findings reached through this method of reasoning are supported with references to secondary sources of international law, mostly academic studies developed in the areas of general international law, international environmental law, and international law on sustainable development.
As for it is concerned to Part II, deductive method of reasoning was applied on primary sources of international law such as the United Nations Convention on the Law of the Sea, and the rules, regulations and procedures adopted by the International Seabed Authority, and upon the decisions and advisory opinions rendered by the International Tribunal for the Law of the Sea. As such, deductive reasoning was also applied to further elaborate on the few doctrinal studies on the matter found in a fruitful research stay at the International Tribunal for the Law of the Sea in Hamburg.
Part III mainly uses inductive reasoning applied upon awards rendered by international arbitral tribunals in investment treaty arbitrations, substantiated by different rules of procedure and submitted to different arbitral institutions. The findings reached were strengthened by the analysis of secondary sources of international law such as academic studies and the reports of international organisations on issues related to international investment law and Investor-State dispute settlement.
Part I was aimed to describe the history and evolution of sustainable development in international policy and within the jurisprudence of international adjudicative bodies to argue for the existence of a narrative of balance and one of prevention subjacent to the term. Part II and III were aimed to evaluate the thesis, this is, to examine the extent to which sustainable development could be strategically used in the litigation of disputes involving transnational companies, in order to adequately integrate social and environmental issues in disputes arising in the fields of deep seabed mining activities in the Area and foreign investment.
Now, let me, please, expand a bit on the main arguments developed in each of these sections and their main concluding remarks.
Part I examined the place that sustainable development has in the field of international policy and law, and within the jurisprudence of international adjudicative bodies in inter-state disputes. Out of this study, it was evidenced that a narrative of balance and a narrative of prevention were at the core of the concept of sustainable development.
To present these core elements as narratives wants to highlight their main feature, which is their stand as hermeneutical resources to the construction of legal reasoning. The narratives subjacent to sustainable development represent the more practical, legal dimension of this term, and are inclusive of the goals set for sustainable development as a public global interest. Indeed, they are directed to evaluate in an integrated manner all economic, social and environmental aspects in any decision-making process. As such, these narratives strengthen the exercise of authority through a coherent and solid legal discourse.
Particularly, concerning the narrative of balance, in most of the decisions of the international adjudicative bodies that were reviewed, sustainable development was considered a concept able to express the need of balance between economic, social and environmental aspects. The jurisprudence was uniform as to considering the three dimensions of sustainable development to be mutually reinforcing elements, this is, that all of them were to be considered and weighed equally. In this sense, the jurisprudence of the adjudicative bodies reviewed is in conformity with the developments that the concept of sustainable development has gone through in the realm of international policy and law under the auspices of the UN.
Concerning the narrative of prevention, the Ogoni People case and the Iron Rhine case represented an improvement in the way that most of the international adjudicative bodies approached to sustainable development. The contribution of these cases was to provide sustainable development with a more practical side compared to that represented by the narrative of balance, which in practical terms can be more difficult to address. Indeed, the duty to prevent or mitigate environmental damages gave rise to a narrative that can be useful to justify the measures taken by states and international organisations aiming to that end, articulating on an integrated manner issues of economic, social and environmental nature.
The analysis in Part I showed that there is sufficient evidence to consider that the narratives of balance and prevention are not fixed to be implemented upon any given category, but can be indistinctly referred to: (i) legal aspects, such as regulations, norms or rights addressing issues of economic, social or environmental nature; (ii) to factual circumstances, as the balance pursued on the potential risks that achieving economic development may pose on social development and/or the environment; or (iii) to a mix of the above, through the balance between the objectives pursued by the law and the economic, social and environmental interests pursued by a state or an international organisation.
Moving to the presentation of Part II which aim was to evaluate the thesis in disputes arising out of DSM, the study showed that the legal framework designed to carry out such activities is well-equipped, at least theoretically, to comprehensively encompass the concurrent economic, social and environmental dimensions during the time when the mining activities are carried out as well as once claims concerning the responsibility and liability of the ISA are to be entertained by the SDC.
These findings were supported, firstly, on the fact that the legal framework for DSM itself envisages an integrated set of norms and obligations aimed to the protection of the common heritage of mankind and the marine environment that all participants taking part in DSM activities must abide by. Secondly, it is also relevant the power vested in the International Seabed Authority to compel contractors to comply with their obligations concerning to the protection of the common heritage of mankind and the marine environment, either through refusing extensions to the exploration contracts or through the adoption of emergency orders and/or the imposition of other sorts of penalties.
As it was shown, the narratives subjacent to sustainable development prove to be useful argumentative resources to interconnect contractors’ obligations as well as to better motivate the measures adopted by the ISA in order to effectively protect the common heritage of mankind and the marine environment. In the third place, sustainable development narratives of balance and prevention were proven to constitute useful argumentative resources to the adjudicative process that the SDC will have to perform, especially regarding disputes concerning the determination of the responsibility and liability of the ISA and the application of the contributory fault standard. As it was claimed, these narratives will aid the SDC to adequately weigh the principles governing the activities in the Area vis-à-vis the behaviour of the parties to the dispute, playing a crucial role both in the assessment of facts and in the application of the relevant law.
Moving on to the evaluation made in Part III, this is to examine the use of the narratives of balance and prevention in Investor-State dispute settlement, the study showed that the strategic use of sustainable development in disputes arising from activities carried out under the umbrella of foreign investment regimes, cannot be performed as straight forward as it was in the case of disputes relating to DSM. This is mostly attributed to the restraints posed to host states by the paradigm of the protection of the investment. Indeed, this paradigm is strengthened, firstly, in the lack of protection granted in international investment treaties to indigenous and local communities, and to the environment, against the solid protection granted to investors’ rights. Secondly, the system created to carry out foreign investment activities, deliberately, leaves on each state the adoption of the domestic legislation aimed to effectively protect their indigenous and local communities and the environment, while they are also urged to create a safe and competitive market environment to encourage foreign investment, all of which, in not few cases, lead states to seek false comparative advantages by lowering their national, social or environmental protection standards. Thirdly, the rules regulating Investor-State dispute settlement mechanisms, provide not much help as far as they are established to grant investors with a secure forum where to claim host states’ responsibility and liability for the breach of the investment protection standards, but where social and environmental aspects of the disputes are often blurred away.
Taking all of this into account, the strategic use of the sustainable development narratives of balance and prevention in ISDS, were to be sought indirectly, this is, through their application in some commonly held arguments crafted by host states against claims raised by investors before international arbitral tribunals. Throughout an exhaustive analysis of cases, four legal arguments were found to be more or less suitable to integrate the narratives subjacent to sustainable development as useful argumentative resources to support the position of host states when they adopt measures in the exercise of their surveillance role.
As such, sustainable development narratives were argued to be useful resources in the construction of arguments related to: (i) The failure of the investor to attain social license prior to the beginning of the developmental project; (ii) The threshold for ruling out a claim of indirect expropriation; (iii) The threshold to considering the state to have validly exercised its police powers; and (iv) To support the position of the host state as for its actions to be motivated on the compliance of international public policy.
To different extents, all four arguments were found to provide fertile ground to accommodate social and environmental concerns in ISDS, while effectively resisting, on the one hand, the strong protection granted to foreign investment in international investment treaties and, on the other, the reluctance observed in ISDS to integrate non-investment-related issues as elements of the adjudication process.
Finally, I want to conclude conveying a general thought that emerges out of this research, which is that the role performed by the participants to the different international dispute settlement mechanisms is central to the achievement of an integrated approach to the sustainable development narratives in international adjudication. In this sense, judges and arbitrators should contribute to the advancement and promotion of the sustainable development narratives of balance and prevention within the construction of their legal reasoning. At the same time, it is expected that states and international organisations also push forward sustainable development arguments when constructing their legal reasoning in order to adequately integrate social and environmental matters within litigation.
Indeed, the contribution of this thesis is to unravel the potential of the concept of sustainable development, making it useful for international litigation operators through the promotion of an argumentative technique that facilitates the integration of the many interests converging in international disputes.
So, if this is the case, the strategic use of sustainable development narratives can contribute to the creation of progressive jurisprudence by setting legal precedents. It may also contribute to the strengthening and clarification of international and regional economic, social and environmental standards, all of which will impact on the legal assessment of the behavior of TNCs, which at its turn is expected to induce a shift in TNCs choices and preferences towards social and environmental matters as the decisions on the disputes will start to grow against them.
