The (federal government’s) Australian Research Council has provided $260,000 to support this project over 2014-6 (DP140102526), in collaboration with Prof Leon Trakman (lead-CI, former Dean of Law at UNSW), A/Prof Jurgen Kurtz (Melbourne Law School) and Dr Shiro Armstrong (ANU Crawford School of Public Policy, co-editor of the East Asia Forum blog). Below are parts of our original project application to the ARC; an updated and edited version is available at http://ssrn.com/abstract=2362122.
[Abstract] “This project will evaluate the economic and legal risks associated with the Australian Government’s current policy on investor-state dispute settlement through multidisciplinary research, namely econometric modeling, empirical research through stakeholder surveys and interviews, as well as critical analysis of case law, treaties and regulatory approaches. The aim of this project is to identify optimal methods of investor-state dispute prevention, avoidance and resolution that efficiently cater to inbound and outbound investors as well as Australia as a whole. The goal is to promote a positive climate for investment inflows and outflows, while maintaining Australia’s ability to take sovereign decisions on matters of public policy.”
[Aims] Foreign direct investment (FDI) has become essential to global economic development, with FDI flows exceeding US$1.5 trillion in 2012 (UNCTAD 2012). Australia’s treaty making practice, especially its current policy with respect to investor state dispute settlement (ISDS), may be sub-optimal, in that it is not entirely based on sound economic cost-benefit data and supporting econo-legal research. Australia can potentially increase its share of the global FDI pool by adopting a more efficient approach to formulating policy with respect to ISDS.
This project aims to develop a key policy framework and devise salient institutional structures and processes that take account of two competing pursuits: the cost-benefit advantages of promoting Australia as an FDI destination; and the need to ensure that these advantages are considered in light of competing policy objectives that are not explicated exclusively on economic grounds (as explained in the Background section). This project is valuable and innovative because it identifies significant gaps in the current Australian policy framework and uses interdisciplinary research to address them.
The overall purpose is to ensure that Australia attains its optimal share of the global FDI market in the context of competing policy objectives. As such, the project will evaluate the economic and legal risks associated with the Australian Government’s current policy on ISDS through multidisciplinary research, namely econometric modeling, empirical research through stakeholder surveys and interviews, as well as critical analysis of case law, treaties and regulatory approaches. The general aim is to identify optimal methods of investor-state dispute prevention, avoidance and resolution that efficiently cater to inbound and outbound investors as well as Australia as a whole. The specific purposes therefore are: (1) to investigate policies that underpin Australia’s approach to negotiating international investment treaties, with particular emphasis on its policies on avoiding, managing and resolving investment disputes; (2) to identify and analyse links between these policies and the investment practices of both inbound and outbound investors; and (3) to propose recommendations on alternative approaches to investment policy, so that, through a carefully framed cost-benefit analysis, Australia can retain appropriate sovereignty over public policy issues (such as health and the environment) while promoting a positive economic climate for investment inflows and outflows.
Author: Luke Nottage
Prof Luke Nottage (BCA, LLB, PhD VUW, LLM LLD Kyoto) is founding co-director of the Australian Network for Japanese Law (ANJeL), Associate Director (Japan) of the Centre for Asian and Pacific Law at the University of Sydney (CAPLUS), and Professor of Comparative and Transnational Business Law at Sydney Law School. He specialises in international dispute resolution, foreign investment law, contract and consumer (product safety) law.
The Potential Impact of Japan’s New State Secrecy Bill on Freedom of Information
Written by Joel Rheuben (with a more extensively hyperlinked version at freedominfo.org)
As recently reported on the ABC, on 25 October the Japanese government moved to introduce to the Japanese legislature the “State Secrecy Bill” (formally, the Bill on the Protection of Designated Secrets). The government apparently hopes to make the bill law by the end of the year, in time for the establishment of a new National Security Council, which has been used as the justification for the bill.
Perhaps because of this rush, the bill is – to paraphrase Oscar Wilde – not only bad, but badly written, which is worse.
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Looking Back from Abroad on the Accomplishments of Professor Zentaro Kitagawa
The late Professor Zentaro Kitagawa (1932-2013) is sorely missed, as a renowned scholar of private law and comparative law, as well as an extraordinarily active builder of bridges among researchers in Japan and many parts of the world.
Melanie Trezise’s translation of a speech given by his “deshi” Professor Keizo Yamamoto at a Remembrance Function, held in Kyoto on 23 June 2013, will be published in the next issue of the Journal of Japanese Law along with the following brief remarks from Professor Harald Baum and myself – who first met in 1992 as researchers at Kyoto University under Professor Kitagawa. Sydney Law School will also host a symposium on “Contract Law Reform in Asia”, on 6 December 2013, dedicated to the inspiration and intellectual energy provided by Professor Kitagawa.
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Obituary for Professor Satoru Osanai
Written by Dan Rosen (Professor, Chuo Law School)
You don’t need to believe in the system of making merit for a future life to appreciate its value in the present one. Satoru Osanai was a world-class merit-maker, spreading it across the globe and empowering others to do the same.
Professor Osanai died on September 4th, a few days after his 71st birthday. Throughout his career at Chuo University, he introduced Japanese students and scholars to the legal systems of other countries, and he demystified Japan’s legal system for audiences abroad.
Investor-State Arbitration: In the TPP and RCEP (‘ASEAN+6’ FTA)?
It remains to be seen whether the new Coalition Government will revert to Australia’s longstanding treaty practice prior to the 2011 ‘Gillard Government Trade Policy Statement’. That declared that Australia would not include investor-state arbitration (ISA) protections in future investment treaties – including investment chapters of Free Trade Agreements – even with developing countries.
The new Prime Minister, Tony Abbott, has declared that he is keen to conclude FTAs which Australia has long been negotiating with Japan, Korea and China respectively. The Gillard Government’s stance on ISA adding to delays experienced in finalising these treaties – see comments, including some of my own in The Australian on 21 September 2013. It also complicates negotiations for regional agreements like the Trans-Pacific Partnership (TPP) agreement and the Regional Comprehensive Economic Partnership (RCEP).
The ISA system is far from perfect, but there are many ways for Australia to draft provisions in investment treaties – old and new – to balance public and private interests effectively. Examples that attract varying degrees of support, from experts in international investment law, are provided in my paper co-authored with Chris Campbell and Sophie Nappert, forthcoming in a special issue of the Transnational Dispute Management journal. It and some of my other recent papers relevant to this topic, uploaded on SSRN.com, are listed with their Abstracts below.
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Sydney Law School students in Asia: (4) China
Following on from the report by Angelica McCall on her learning experiences in China, another final-year LLB student, Diana Hu, outlines her participation in an international forum for law students held from 19 August by Renmin University in Beijing – one of Sydney Law School’s important partners in China.
“Legal Integration within the Asia-Pacific: The First China International Legal Elite Camp”
Written by Diana Hu.
“China is now such a powerful country – in terms of size, people, and the economy. What does China have to gain by forming a union with Japan or South Korea?”. This astute question was asked by a PhD student from South Korea and directed at Associate Professor Dong Yang, Vice President of Asia Pacific Legal Studies at the Renmin University of China (RUC). And so begun an intensive week of multilingual lectures, team-based discussions and thought-provoking presentations, all centred around one theme: legal integration within the Asia-Pacific region.
Nineteen law students from 17 universities across the Asia-Pacific met during Beijing’s hot summer, eager to attend the “Future Leader – First China International Elite Camp” hosted by the RUC Law School. Armed with prior research and materials, we all expected to learn about the Chinese legal system while examining the interaction between our diverse laws across the Asia-Pacific region. What I did not expect was one of the most enjoyable weeks of my 6-year (extended) double degree, full of new cultural and social experiences.
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Taking Seriously Consumer Product Accident Reporting Duties under Australian Law
On 8 June 2013 the Sydney Morning Herald reported that Volkswagen Australia would be formally recalling Golf and other Volkswagen-made models that had suddenly lost power. The family of one driver and the driver of a truck that rear-ended her Golf vehicle are arguing before the coroner that this was a possible cause for her fatal accident. Over 300 other owners of Volkswagen-made vehicles have also reported problems. Similar concerns about some of Volkswagen’s direct-shift gearboxes had led to formal recalls of some models as early as 2009 in the USA, then in China, Singapore, Japan, Malaysia and Taiwan. However, Volkswagen reportedly stated that Australia does not have the same gearboxes, and instead had initially undertaken a program involving its dealers. Marketing experts have criticised the recall recently commenced in Australia, suggesting that Volkswagen will have suffered extensive damage to its brands by not acting publically earlier to address consumer concerns – in addition to the estimated $170m in direct repair costs.
It will probably come as no surprise that Volkswagen conducted recalls more promptly in the USA. Toyota suffered extensive adverse publicity there relating especially to problems instead involving sudden acceleration, generating recalls of over 10 million vehicles over 2009-2011 and a recently-finalised $1.6b class action settlement. Nor should it be surprising that Volkswagen undertook a recall in Japan. Japanese consumers have become increasingly sensitive about product safety issues, especially since 2000 – when Mitsubishi Motors was found to have been conducting illegal clandestine recalls over an extended period. The delay in Australia is disturbing, especially given the increased attention otherwise being paid to consumer protection since “re-harmonisation” pursuant to the Australian Consumer Law (ACL) reforms enacted in 2010.
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Guest Blog – Assessing the significance of PM Abe’s electoral “victory”
Written by Joel Rheuben (LLM candidate UTokyo, LLB/BA (Hons) Syd, Solicitor (NSW))
The 21 July 2013 election for the House of Councillors, the upper house of Japan’s Diet, has reversed the status quo of the past several years by providing the governing parties with a majority in both houses. As Tobias Harris rightly points out, possibly pre-prepared descriptions of the victory as a “landslide” fall wide of the mark. Prime Minister Shinzo Abe’s Liberal Democratic Party (LDP) did not achieve a majority in its own right, and will continue to be dependent on the support of its coalition partner, Komeito. The majority also falls well short of the two-thirds that would have allowed Mr Abe to more easily realise his cherished goal of initiating a referendum for constitutional amendment. Nevertheless, this election result does have some constitutional and practical significance.
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Discourse and Practice in International Commercial Arbitration
On 24 May 2013 I gave a presentation by videolink to a conference on “The Roles of Psychology in International Arbitration“, held in London at Brunel University, in the session related to international arbitration awards. This drew partly on Hong Kong based interdisciplinary research project on discursive practices in international arbitration, with considerable emphasis on Asia-Pacific developments. The presentation outline is below or here (download PDF file).
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Disaster Management: Socio-Legal and Asia-Pacific Perspectives
Catastrophic events are increasingly in the public eye, fuelling a burgeoning but complex field of interdisciplinary research and policy-making worldwide. Recent devastating natural disasters have included the Indian Ocean Tsunami in 2004, Hurricane Katrina in the United States (US) in 2005, Cyclone Nargis in Burma (Myanmar) and the Sichuan Earthquake in 2008. Developed economies have not been spared, as shown by the Christchurch earthquake in New Zealand and Australia’s widespread floods in Queensland in 2011. In particular, the disasters that wreaked havoc from 11 March 2011 in the north-east region of Japan have highlighted the significance and challenges of disaster prevention and management.
Based on the international conference held at Sydney Law School in March 2012, which has also generated a recent mini-issue (No 34) of the Journal of Japanese Law, A/Prof Simon Butt, Dr Hitoshi Nasu and I have co-edited “Asia-Pacific Disaster Management: Comparative and Socio-Legal Perspectives” (Springer, forthcoming November 2013). A manuscript version of our extensive introductory chapter, freely downloadable here, outlines:
(i) what can be encompassed by the terms “disasters” and “disaster management”;
(ii) contributions to “disaster studies” from various social sciences as well as domestic and international law perspectives; and
(iii) lessons that can be learned from socio-legal perspectives on recent catastrophes in Asia-Pacific countries, including possibilities for regional and international cooperation in disaster mitigation, relief and recovery.
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