The Tension between Korean Environmental Protection Policies and U.S. Investors\u27 Interests Under the U.S.-Korea Free Trade Agreement

South Korea’s low carbon and ‘green growth’ policies possess potential regulatory changes that reduce foreign investors’ interests and legitimate expectations concerning the profitability of their businesses. Although international investment law protects a government’s right to protect legitimate public welfare objectives, such as environmental protection, the investor-State dispute settlement provision allows foreign investors to seek compensation for a country’s law and policies contrary to their interests. On the other hand, investor-State dispute settlement provisions inherently have many problems. Despite the problems, protecting both foreign investors’ interests and States’ regulatory sovereignty is very important. For this reason, this dissertation examined why the tension between foreign investors’ rights and States’ regulatory sovereignty arises and how to solve this tension. This dissertation especially reviewed whether there is a possibility that U.S. investors will bring a claim against South Korea for infringing their property rights, because the Korean government’s environmental measures may amount to an indirect expropriation or a breach of fair and equitable treatment under the KORUS FTA and ultimately suggested ways to reconcile Korean environmental protection policies and U.S. investors’ interests under the KORUS FTA