The agendas for curbing global warming that were laid out in the 2015 Paris Agreement and Sustainable Development Goals will require investments amounting to trillions of dollars across the globe. Renewable energy must become even more affordable and available; energy-efficient transportation will be needed to carry an increasingly mobile world population; sustainable agriculture and forest restoration must substitute unsustainable land use and deforestation; and climate-resilient infrastructures must be built where global warming and rising sea levels already put communities at risk. To some extent, the technologies necessary already exist – solar and wind power, energy-efficient vehicles, and carbon capture and storage – but enormous investments are needed to deploy these on a meaningful scale. In other areas, investments are needed to support the innovation of new technologies where existing ones fall short.
A recurring theme post Paris has been that although the money for these green investments exists, investors are hesitant to deploy their funds in the absence of stable and transparent legal frameworks, including neutral and reliable enforcement mechanisms. Today, no international legal instrument exists that specifically incentivizes and protects cross-border investments aimed at climate change mitigation and adaptation.
Against this background the Arbitration Institute of the Stockholm Chamber of Commerce (SCC), with partners like the International Bar Association (IBA) and the crowd sourcing platform HeroX.com, is launching the Stockholm Treaty Lab – an innovation contest where the grand prize will be awarded to the contestant team that drafts the model treaty with the greatest potential to increase investments in climate change adaptation and mitigation. The aim of this competition is set high: The drafting of a new model international treaty that will encourage investment in climate change mitigation and adaptation. A treaty that, if implemented, would create transparent, stable and enforceable investment policy regimes and encourage investors to fund low-carbon projects, support technological innovation, and otherwise invest in a sustainable future.
The SCC envisions that contestants will draw inspiration from the existing regime of international investment agreements, which encourages foreign investments by ensuring market liberalization, fair treatment of investors, and neutral enforcement through arbitration.
This short video introduces the Stockholm Treaty Lab. More information on the initiative is also available on the Stockholm Treaty Lab website.
The contest will be launched shortly, and additional reading can be found here. If you would like to join this initiative, please do not hesitate to contact us.
Annette Magnusson, SCC Secretary General
