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Regulatory Chill and Domestic Law: Mining in the Santurbán Páramo

Published online by Cambridge University Press:  13 January 2023

Anna Sands Open the ORCID record for Anna Sands [Opens in a new window]
Anna Sands*
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Senior Policy Advisor at WWF–UK (but writing in personal capacity)
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Email: annazsands@gmail.com
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Abstract

A persisting question about investment treaties is whether they lead to regulatory chill – the reluctance to regulate on environmental and social issues due to fear of investment claims. The literature on this topic has been predominantly focussed on how the state responds to international pressures, and little has been written about what happens within the state itself. This article aims to fill that gap by analysing the interplay of domestic laws and institutions in the context of potential investment claims, based on the case study of mining in the Santurbán páramo region in Colombia. The article shows that even though Colombia had created laws and institutions that internalized international investment law, it did not bring about regulatory chill in the case of Santurbán; this is due to the role of domestic constitutional law and the Constitutional Court. This case study also adds to the understanding of how the Liberal International Order is shifting from international to domestic governance, by showing how domestic laws and institutions can have diverging priorities when determining how the risk of investment claims is dealt with.

Keywords

ISDSinvestment lawconstitutional lawColombiainvestment treaty
Type
Original Article
Information
World Trade Review , Volume 22 , Special Issue 1: Domestic Investment Laws and International Economic Law in the Liberal International Order , February 2023 , pp. 55 - 72
Copyright
Copyright © The Author(s), 2023. Published by Cambridge University Press

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26 See Article 14 of the Decree. This distinguishes it from the 42 states that have granted consent to international arbitration via their domestic law, see T.L. Berge and T. St John (2021) ‘Asymmetric Diffusion: World Bank “Best Practice” and the Spread of Arbitration in National Investment Laws’, Review of International Political Economy 28, 584.

27 Mining Code (Law 685 of 2001). Law 685 of 2001.

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37 Ibid 16.

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87 Which reinforces the argument that capacity needs to be analysed at the level of the institutions within the state, not as that of the state as a whole. See: Geddes, Politician's Dilemma: Building State Capacity in Latin America, supra n. 19 (n 20); K. Bersch et al. (2017) ‘Bureaucratic Capacity and Political Autonomy Within National States: Mapping the Archipelago of Excellence in Brazil’, in M.A. Centeno, A. Kohli and D.J. Yashar, with D. Mistree (eds.), States in the Developing World. Cambridge University Press, www.cambridge.org/core/product/identifier/9781316665657%23CT-bp-6/type/book_part (accessed 14 March 2020); M.A. Centeno et al. (2017) ‘Unpacking States in the Developing World: Capacity, Performance, and Politics’, in Centeno et al.,(accessed 18 March 2020); E.M. McDonnell (2017) ‘Patchwork Leviathan: How Pockets of Bureaucratic Governance Flourish within Institutionally Diverse Developing States’, American Sociological Review 82, 476.

88 Para. 19.3 of the Judgement.