Annual Hyman Soloway Lecture
"The Institutions of Exceptions: Embedding Policy Space in International Economic Law"
Lecture in FTX 227 (bimodal); Followed by reception in the FTX 371 Atrium
Zoom link will follow upon registration.
Panelist(s): Professor Julian Arato of University of Michigan Law School
Description: International economic law seeks to bind the hands of the state, in the interest of liberalizing markets in various ways, including cross border trade in goods and services (trade) and capital (investment). As with all fields of public law, the trade and investment treaty regimes seek to both discipline states through legal rules, while preserving a modicum of governmental power over policy. Though not always recognized as such, the preservation of policy space in these regimes typically involves exceptions-style reasoning by adjudicators – formally in the case of most trade and some investment treaties, and informally in the investment treaty regime more generally. This "exceptions paradigm" of justification has worked well in the trade regime, where it has been especially key to securing a workable balance between market disciplines and regulatory policy space in the WTO/GATT context. But it has been less successful at striking a reasonable balance in the investment regime – irrespective of whether the paradigm has been formally codified in an exceptions clause. This lecture seeks to explain why, by focusing on the institutions within which this mode of justification is embedded. Certain institutional differences between these regimes help explain the varied success of exceptionalism in trade and investment, in particular as to: the right of action (public vs private); the degree of judicial centralization (ad hoc arbitration vs court system); and the available remedies (damages vs regulatory). It is hoped that this focus on institutional embeddedness can also shed light upon the political economy of reform in international economic law going forward.
