International investment law and public health: the need for forward-looking reforms

Abstract Although unsuccessful, Phillip Morris’ claims against tobacco control measures implemented by Uruguay and Australia drew attention to the potential for public health measures to be challenged under international investment agreements (IIAs). This article examines how states have responded to these and other cases, with recently concluded IIAs now often containing clarifications on the scope of indirect expropriation, exceptions for public health measures, and/or carve-outs from investor-state dispute settlement for tobacco control measures or other public health measures. While these changes in treaty drafting provide some protection for policy space related to public health, this article argues that they are largely reactionary to cases that have been brought in the past, and do not address potential new battlegrounds between investors and states relating to public health, for example, emerging health risks for which we do not yet have any international consensus on the appropriate regulatory response (e.g. e-cigarettes), and the measures that many states are now taking to favour domestic producers to ensure manufacturing capability for key public health supplies and pharmaceuticals in the wake of the COVID-19 pandemic and recent geo-political tensions. This leaves a clear direction for future research into how IIAs could be drafted with flexible mechanisms that safeguard policy space for public health crises in future, which may not have been foreseen at the time of treaty drafting. The article then goes on to consider the scope for future research on how IIAs can, in fact, forward public health, through targeted investment facilitation provisions.