Policy Brief: State Interpretations of Investment Treaties: Feasible Strategies for Developing Countries

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Over 3,000 investment treaties are in force today. Many contain vague provisions that give arbitration tribunals insufficient guidance and leave states vulnerable to unintended interpretations.

Under international law, governments have the right to use interpretive tools to clarify these provisions. Yet to date states have made only modest use of such mechanisms. In this brief, we distil lessons from an ongoing process to facilitate interpretative statements, asking what constrains states’ use of interpretive statements and how such constraints might be alleviated. We find that the primary constraints are logistical and practical, rather than any deep-seated political opposition. Given this finding – and states’ expressed desire to pursue greater use of interpretive statements – we suggest three objectives:

1. Increase awareness of interpretive statements as a legal tool

2. Encourage states to share experiences and identify common areas of interest

3. Identify possible institutional forums to support plurilateral interpretive statements