Regulatory Takings and Environmental Regulation in NAFTA's Chapter 11
Resource information
Date of publication
December 2006
Resource Language
ISBN / Resource ID
AGRIS:US2016200592
NAFTA's investment treaty has led to several expropriation compensation claims from investors hurt by new environmental regulations. Expropriation clauses in international treaties solve post-investment moral hazard problems such as hold-ups. However, these clauses can interact with National Treatment clauses in a manner that hinders investment. A police powers carve-out from the definition of expropriation can be Pareto-improvingand can increase the level of foreign investment.
