Regulatory Chill and Domestic Law: Mining in the Santurbán Páramo

Abstract

Abstract A persisting question about investment treaties is whether they lead to regulatory chill – the reluctance to regulate on environmental and social issues due to fear of investment claims. The literature on this topic has been predominantly focussed on how the state responds to international pressures, and little has been written about what happens within the state itself. This article aims to fill that gap by analysing the interplay of domestic laws and institutions in the context of potential investment claims, based on the case study of mining in the Santurbán páramo region in Colombia. The article shows that even though Colombia had created laws and institutions that internalized international investment law, it did not bring about regulatory chill in the case of Santurbán; this is due to the role of domestic constitutional law and the Constitutional Court. This case study also adds to the understanding of how the Liberal International Order is shifting from international to domestic governance, by showing how domestic laws and institutions can have diverging priorities when determining how the risk of investment claims is dealt with.