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Making Allowances for Carbon Emission Allowances in Investor-State Disputes: A Case Study of the Republic of Korea

Chapter

Abstract

On December 2, 2014, the National Assembly of the Republic of Korea passed the two ratification bills for Korea-Australia and Korea-Canada free trade agreements (FTAs) containing investor-State dispute settlement (ISDS) provisions soon after the end of trade negotiations with the two Pacific Rim partners, regardless of an on-going multi-billion dollar ISDS claim initiated by the Lone Star Funds—an American private equity firm—against the Korean government (LSF-KEB Holdings SCA and others 2012), invoking similar ISDS provisions provided in another investment treaty with the Belgium-Luxembourg Economic Union (Korea-Belgium/Luxembourg BIT 2006). In fact, this claim placed Korea for the first time as a respondent State in known ISDS cases (UNCTAD 2013). Such a bipartisan support to the proposed bills resembles that of the National Assembly in May 2012 when its members passed the Emissions Trading Scheme (ETS) bill almost unanimously with only 3 abstentions and placed Korea as the first Asian country to initiate an ETS (International Emissions Trading Association 2013), despite the fact that the ETS of the European Union (EU), the largest carbon trading market, revealed its serious loopholes in its trial period. Interestingly enough, the two FTAs and the Korean Emissions Trading Scheme (KETS) came into effect concurrently from January 2015.

Keywords

European Union Emission Trading Scheme Investment Treaty Bilateral Investment Treaty European Union Emission Trading Scheme 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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Copyright information

© Springer International Publishing Switzerland 2016

Authors and Affiliations

  1. 1.Yonsei Law SchoolSeoulSouth Korea

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