Originally from Investment Treaty Arbitration and International Law - Volume 4

In thinking about a topic for this Luncheon Address, I came upon a recent article by Jürgen Kurtz which made the intriguing observation that "we are now in a state of serious jurisprudential uncertainty about the application of the national treatment norm."1 This comment led me to take another look at the decisions that have considered the national treatment obligation which is common to bilateral investment treaties (BITs) and investment chapters of free trade agreements. My review led me to the conclusion that Kurtz is right, particularly in the case of state-owned enterprises (SOEs), and national champions that are given special benefits by the state.

This is an appropriate time to ponder what to do about this "jurisprudential uncertainty" since the United States is currently reviewing the 2004 Model BIT and recent actions by the Obama Administration seem to suggest a revitalization of interest in trade agreements. While the Administration continues to express support for a successful conclusion of the DOHA Round, the political calendar realistically precludes any likelihood of an agreement this year. On the other hand, regional trade agreements give the Administration the opportunity to focus on the labor and environmental issues that are of concern to democratic constituencies in Congress such as the House Trade Working Group led by Congressman Mike Michaud of Maine.