Socialising losses, privatising gains: how Dutch investment treaties harm the public interest
Joint publication (20 pages), January 2015
Dutch investment treaties (BITs) are frequently used by foreign companies to sue governments in the North and South for policies that might harm their future profits. 75% of these cases were brought by mailbox companies with no real economic substance in the Netherlands, making use of the vast web of Dutch BITs and the rights and protection given to foreign investors.
The Netherlands takes a central position in the current debate around BITs and international investment agreements (IIAs). More than 10% of all known investment treaty claims make use of Dutch Bilateral Investment Treaties (BITs).The growing controversy surrounding BITs – and in particular the mounting critique of Dutch BITs as being excessively investor-friendly, to the detriment of the policy space of developing countries– has led the Dutch trade department to announce a review of Dutch bilateral investment treaties with developing countries. This paper gives a critical civil society perspective on the clear tension between BITs protections and the democratic right and duty of the state to regulate in the broader public interest.
This paper also discusses the risks that the extensive Dutch BIT network poses for the Netherlands itself. So far, the Netherlands has never been on the receiving end of an ISDS claim, but changing global patterns of investment increase the likelihood of developed countries being sued before ISDS tribunals. The paper concludes with concrete recommendations for a more sustainable and inclusive investment policy.
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