The presence of legal certainty within a country’s legal system is a very relevant factor in the foreign investor’s decision to invest in a particular country. It is therefore necessary for countries to develop mechanisms for avoiding or reducing the uncertainty over the law in their legal systems. This article studies the Southern Common Market’s (“MERCOSUR”) structure and function with the purpose of assessing it as a mechanism to offer legal certainty to foreign investors in the region. The analysis is carried out by examining three basic elements of this regional integrationist experience: a) its body of law, b) its institutional experience, and c) its juridical system. By analyzing each of them, it is possible to identify several elements that contribute to the provision of legal certainty for foreign investors: a coordinated work among its institutions, recognition of the principle of supremacy of its body of law, the private sector’s participation in the decision-making and a tribunal that issues consulting opinions about the meaning of MERCOSUR law. Under these considerations, the article proposes MERCOSUR as an innovative alternative to the traditional mechanisms used by countries for the provision of legal certainty, such as bilateral investment treaties.
Camilo A. Rodriguez Yong , Providing Legal Certainty in South America: Can Mercosur Help?, Pace Int’l L. Rev. Online Companion, Oct. 2010, at 1.