Investment for Green Growth: An Analysis of the CAI Environmental Provisions

Abstract

Since 2012, international investment tribunals have passed several awards highlighting the interaction between environmental obligations imposed upon foreign investors and the host State’s duties towards investors in terms of green investment. The EU-China Comprehensive Agreement on Investment (CAI) is a step forward in continuing the debate on environmental protection and conservation in the context of investment law. This article focuses on section IV subsection 2 of the CAI and analyses the relevant provisions of the CAI and other Sino-EU BITs having a potential impact on the development of environmental policy and climate change-related measures. This article references publicly available investor-State arbitration decisions to understand the ramifications of environmental standards on foreign investment policymaking. Further, this article also highlights the potential impact of the CAI on green investment and green financing measures undertaken by the European Commission.