Posts tagged ‘investment law’
Reading Public Interest into BITs: Continuing Avidan Kent’s Discussion
I read Avidan Kent’s post, and the commentary that followed, on this blog describing his view of the true nature of BITs with great interest. I wanted to continue the discussion of the place of public interest in BITs and to the extent that they are considered. I am in agreement with Kent’s assessment. I offer here at least a narrow area in international investment law where arbitral tribunals have managed to read in public interest into BITs. In considering whether an investor’s legitimate expectation should be protected under the commonplace fair and equitable treatment clauses, there is some room for maneuverability and consideration of “public interests” in determining when the investor’s expectations are in fact “legitimate”.
I draw the readers’ attention to the 2007 ICSID award in Parkerings v. Lithuainia. Had the BIT contained a stabilization clause to the effect that the host State had assured and represented that the legal and regulatory conditions under which the agreement was entered into was to remain the same, then the outcome of the tribunal’s analysis would have been different. In the absence of such assurances, the tribunal extended its analysis beyond the mere wording of the BIT to the social and political framework of Lithuania at the time that it was entered into. The arbitrators found that 1998 Lithuania was in a transition from being a part of the Soviet…
The true nature of BITs (at least as I see it…)
On February 19-20 a conference which dealt with recent developments in the field of international investment law took place at Sydney University.[1] About sixty speakers from all around the world gathered for two intensive days of exchanging ideas, debating pressing issues and discussing what seems to be an emerging sub-field of international law. One important trend that was highly emphasised during this conference was the recognition that international investment law is far more public in nature than it was considered to be in the past. The effects of foreign investment on public interests such as the environment, human rights and labour standards are now obvious and the tension between the protection of investments on the one hand, and the governments’ interests in regulating these sensitive fields on the other, is often emphasised in academic writings and arbitration awards.
The conceptual change that international investment law seems to have gone through has not however reached one very fundamental point. To my great surprise, speakers continually repeated the same old mantra concerning the main objective of investment treaties: the objective of investment treaties, so it was argued, is the protection of investors. This, I would argue, carries the same amount of logic as claiming that the objective of preparing a salad is cutting tomatoes. While it is true that Bilateral Investment Treaties (BITs) are designed to provide…
