National Measures to Secure Constitutionally Justified Regulatory Powers of Korea in the Framework of the Current Korea-US Free Trade Agreement Chapter 11

This paper proposes national legal alternatives for the Korean government, as a party state of the Korea-US Free Trade Agreement (KORUS-FTA), to secure constitutionally legitimate regulatory powers. Critical commentators opine that the Investment Chapter of the KORUS-FTA allows global investors to challenge various types of government action even in a national public area such as public health, environment protection or land zoning. Particularly, investor-state arbitration (ISA) can present a risk to a disputing state. In response to such risks, this research argues for more indirect but legally legitimate control of investment arbitration by using the sovereign power of treaty making. Such measures are acceptable not only to national players but also to global ones in the international investment field, because they are allowed by international and national law. These alternatives can be called a contextual control in the sense that it does not pursue a direct control of the arbitration system; instead, it adjusts the contexts of the arbitrator's act, namely treaty interpretations. The party state transplants its goal of investment policy by facilitating procedural instruments to reduce the discretion in interpreting a disputable treaty provision. The KORUS-FTA, influenced by models of modern international investment treaty (IIT), provides many contextual control measures, despite some limitations.