Water, Water Services and International Investment Agreements

Abstract

Globalization has increased the volume of Foreign Direct Investment (FDI) in developing countries. It also has promoted “global constitutionalism,” a process involving the incorporation of international norms into constitutional principles developed at the national level. When conflicts arise between foreign investors and national governments then arbitration tribunals created under international investment agreements are often called upon by the private investor. The objectives of this chapter are to examine whether protection of investment agreements by international tribunals has had negative impacts on water and its services and what can be done to remediate any negative impacts of these agreements. The chapter finds that criteria and procedures used by these tribunals tend to simplify very complex situations, and are often contrary to local and national laws created through centuries of trial and error; and argues that arbitration tribunals should make greater use of principles of law accepted by civilized nations when dealing with cases related to international investment agreements. Otherwise, these courts risk reductionism and, in the long term, irrelevancy.