Fair and Equitable Treatment Standard in International Investment Law

OECD, Directorate for Financial and Enterprise Affairs, OECD Working Papers on International Investment 01/2004;
Source: RePEc

ABSTRACT The obligation to provide “fair and equitable treatment” is often stated, together with other standards, as part of the protection due to foreign direct investment by host countries. It is an “absolute”, “non-contingent” standard of treatment, i.e. a standard that states the treatment to be accorded in terms whose exact meaning has to be determined, by reference to specific circumstances of application, as opposed to the “relative” standards embodied in “national treatment” and “most favoured nation” principles which define the required treatment by reference to the treatment accorded to other investment1. Although some references to the standard can be found in the first negotiating attempts of multilateral trade and investment instruments, it became established as a principle mainly through the increasing network of bilateral investment treaties.

The obligation of the parties to investment agreements to provide to each other’s investments “fair and equitable treatment” ...

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    ABSTRACT: Like all rules of customary international law those existing in the field of international investment law are binding upon all States. According to the theory of the persistent objector, however, a State is not bound by a rule if it objected to it in the early stages of its formation and continued to do so consistently thereafter. This paper analyses the different grounds of criticisms that have been raised against the concept. We found that there is only very weak judicial recognition of the concept, that there is no actual State practice supporting it and that it is logically incoherent. Specifically, this paper argues that the concept should not be successfully used in investor-State arbitration proceedings to prevent the application of a custom rule by an arbitral tribunal. This is essentially because of the great importance of the only few custom rules existing in that field and the fact that they represent universally-recognised values.
    Leiden Journal of International Law 04/2009; · 0.46 Impact Factor


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