Preserving Flexibility in IIAs

The Use of Reservations

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Reservations in International Investment Agreements are a key technique for balancing flexibility of national authorities with international commitments in the field of investment, especially for developing countries. This paper studies the use of such reservations at two levels. First, it assesses the various means that signatories have at their disposal when attempting to preserve flexibility and regulatory autonomy. Second, it explores the revealed preferences for flexibility emerging from the reservation lists of eight International Investment Agreements employing a negative list approach to scheduling non-conforming measures.



Handle with care: A word of methodological caution

The empirical work conducted in this study consists of recording the number, nature and sectoral incidence of reservations contained in the reservation lists of each contracting party to the eight IIAs under review. The study’s main aim is not so much to focus on the aggregate number of reservations found under each agreement – which will naturally vary according to the sectoral scope and substantive provisions found in them – but rather to present major trends and to infer and compare patterns of conduct and the policy preferences these patterns reveal. The conclusions and findings stemming from this analysis should be considered as a first tentative approximation on the issue. They should be regarded with a few additional considerations in mind


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