This is from Roger Alford at Opinio Juris:
despite the assumption that international trade disputes must be resolved before the WTO DSB, the existence of broad umbrella clauses in BITs present a promising vehicle for enforcing investment commitments in trade agreements.
...
umbrella clauses in BITs could create a private right of action for resolving WTO disputes. Investment arbitration circumvents the traditional barriers to initiating a WTO dispute. Diplomatic espousal is no longer a reliable check on the pursuit of unmeritorious claims. Through umbrella clauses foreign investors could seek recourse for violations of investment obligations that form part of WTO disciplines.
Personally, I'm pretty happy with the balance WTO dispute settlement draws in terms of creating binding international economic law while allowing enough flexibility to keep the system from interfering too much with domestic sovereignty. Throwing off this balance by allowing a private right of action makes me nervous.
I suppose that if the investment arbitration community wants to try to expand its role in this way, they can give it a shot. There seems to be a combination of pushing forward and pulling back going on right now. It's not clear where things will end up.
