International Business Quarterly: The Importance of Rule of (Investment) Law
April 9, 2014
The “rule of law” is important, but it often is taken for granted. In the marketplace, rule of law is like oxygen: it’s difficult to see, but you can’t survive without it. Investment chapters of U.S. free trade agreements, which govern investment rules, have been a topic of controversy since the North American Free Trade Agreement (NAFTA) first included bilateral investment treaty (BIT) provisions as a trade agreement chapter. Despite two major reviews of U.S. policy designed to address concerns over these provisions, the critics are as vocal as ever, both here and among U.S. negotiating partners. This quarter, we will offer some context about how investor protection agreements advance the country’s economic interest, as well as evidence about how these agreements actually operate.