Towards an Asia-Pacific Regional Investment Regime

Many similarities and occasional differences are evident concerning the current approaches of Australia and New Zealand towards investment treaties, including the now politically sensitive issue of investor–state dispute settlement (ISDS). This chapter considers the potential of these two closely integrated countries to influence the future design of investment treaties in the Asia Pacific region, including for the Regional Comprehensive Economic Partnership (RCEP or ‘ASEAN+6’ agreement) – the negotiations for which include China. The chapter compares key areas of existing treaties already signed by Australia and New Zealand, as well as apparent positions set out by them in a leaked draft RCEP investment chapter. Given the concerns about US–style treaty drafting displayed recently by Indonesia and India, major economies still negotiating RCEP with Australia and New Zealand (as well as bilateral agreements with the former), the chapter also considers the scope for Australia and New Zealand to promote more pro-state provisions regarding both substantive commitments and procedures such as ISDS, which characterize contemporary preferences of the European Union. The chapter concludes that a transition to a new generation of treaties is likely not only given the evolving preferences of counterparties and local politics, but also because of various policy arguments for dialing back treaty commitments to foreign investors—albeit without eschewing them altogether.