As noted in Section 3.2, the preamble to an international agreement plays an important role in describing negotiating goals. It is also critically important in guiding its interpretation, including in dispute settlement processes. In order to ensure that environmental considerations are part of any interpretation and application of the agreement, parties need to go beyond just trade-related and purely economic statements. They can include affirmations that economic objectives should not trump other objectives, or can make reference to specific international principles and guidelines to illustrate the parties’ common understanding on environment protection and other issues relating to sustainable development.
In addition to preambles, many international agreements include an article on the purposes and objectives of the parties to highlight the main goals of the international agreement. Like the preamble, this article will act as a guideline for the parties and dispute settlement bodies when they try to interpret or apply a particular provision of the international agreement. A properly drafted article on purposes and objectives gives added weight to the preamble, which does not have the same legal force as operative provisions within the treaties. Some international agreements have incorporated into the article environment and sustainable development principles, and the need for balance between the states’ sustainable development objectives and the protection of investors’ interests.
Option 1:Incorporate sustainable development considerations in the preamble
Sets negotiation goals and guides interpretations
Examples
“The Parties:
Recognizing the important contribution investment can make to the sustainable development of the State Parties, including the reduction of poverty, increase of productive capacity, economic growth, the transfer of technology, and the furtherance of human rights and human development;” (SADC Model BIT, preamble)
How Commonly Used
Examples
“The Parties:
Upholding the rights of their governments to regulate in order to meet national policy objectives, and to preserve their flexibility to safeguard public welfare;” (China-Australia FTA, Preamble)
How Commonly Used
Examples
“The Parties to this agreement, resolving to:
ESTABLISH a comprehensive regional agreement that promotes economic integration to liberalise trade and investment, bring economic growth and social benefits, create new opportunities for workers and businesses, contribute to raising living standards, benefit consumers, reduce poverty and promote sustainable growth;
…RECOGNISE their inherent right to regulate and resolve to preserve the flexibility of the Parties to set legislative and regulatory priorities, safeguard public welfare, and protect legitimate public welfare objectives, such as public health, safety, the environment, the conservation of living or non-living exhaustible natural resources, the integrity and stability of the financial system and public morals;
…PROMOTE high levels of environmental protection, including through effective enforcement of environmental laws, and further the aims of sustainable development, including through mutually supportive trade and environmental policies and practices;
…PROTECT and enforce labour rights, improve working conditions and living standards, strengthen cooperation and the Parties’ capacity on labour issues;
…RECOGNISE the importance of cultural identity and diversity among and within the Parties, and that trade and investment can expand opportunities to enrich cultural identity and diversity at home and abroad;” (TPP, Preamble)
How Commonly Used
Examples
“The Parties:
MINDFUL that economic development, social development and environmental protection are interdependent and mutually reinforcing components of sustainable development and that closer economic partnership can play an important role in promoting sustainable development;” (China – Korea FTA, Preamble)
How Commonly Used
For some other options, see UNCTAD’s Investment policy framework for sustainable development (2015), (Policy Options for IIAs, Section 1) p. 93.
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