Investor-State Climate Litigation: Could International Investment Law Help to Protect the Climate?

Climate Protection and International Investment Law have an ambiguous relationship. Whereas some scholars highlight that investment Law could help in protecting green investments many commentators depict investment protection as an obstacle to States’ climate mitigation policies. This article seeks to go beyond that limited dichotomy in assessing whether investment law could be a tool for investors to argue for more, rather than less climate protection. In particular, full protection and security clauses may well be interpreted to contain due diligence obligations to protect climate sensitive investments against effects of climate change. Moreover, if States postpone climate protection to a time, when only by imposing a comprehensive ban on GHG emissions they may effectively protect the climate, such an ‘emergency stop’ may well amount to an indirect expropriation for many investors. As transition periods are much likely lacking, such an ‘emergency stop’ may also violate fair and equitable treatment provisions. Given that investors increasingly become aware of climate-related economic risks, the article provides a nuanced assessment of legal tools and arguments investors may employ against host-States unwilling to protect against what has often been depicted as “dangerous climate change” (global average temperature increase above 1.5°C).