Revisiting history: How the past matters for the present backlash against the foreign investment regime

Harvard International Law Journal

Volumn 50, Issue 2, 2009, Pages 491-534

  Kaushal, Asha ^a  

^a NONE

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EID: 69249205649     PISSN: 00178063     EISSN: None     Source Type: Journal    
DOI: None     Document Type: Article

References (335)

1. U.N. Conf. on Trade &Dev. [UNCTAD], Bilateral Investment Treaties 1995-2006: Trends in Investment Rulemaking, 1, U.N. Doc. UNCTAD/ITE/IIT/2006/5 (2007) [hereinafter UNCTAD, Trends in Rulemaking];
2. UNCTAD, Recent Developments in International Investment Agreements (2007-June 2008), 2, U.N. Doc. UNCTAD/WEB/DIAE/IA/2008/1 (Sept. 1, 2008) [hereinafter UNCTAD, Recent Developments 2008]. A comparable number of double taxation treaties also have been concluded.
3. UNCTAD, Recent Developments 2008, supra note 1.
4. UNCTAD, Trends in Rulemaking, supra note 1.
5. Id.
6. Stephen D. Krasner, Structural Causes and Regime Consequences: Regimes as Intervening Variables, 36 INT'L ORG. 185, 186 (1982). "Regime" means "implicit or explicit principles, norms, rules and decision making procedures around which actors' expectations converge in a given area of international relations."
7. See also R. DOAK BISHOP, JAMES CRAWFORD &W. MICHAEL REISMAN, FOREIGN INVESTMENT DISPUTES 9-17 (2005);
8. ALAN REDFERN &MARTIN HUNTER, LAW AND PRACTICE OF INTERNATIONAL COMMERCIAL ARBITRATION 5-12 (4th ed. 2004).
9. Jose' E. Alvarez &Kathryn Khamsi, The Argentine Crisis and Foreign Investors: A Glimpse into the Heart of the Investment Regime 12 (Int'l Inst, for Law &Justice, IILJ Working Paper 2008/5, 2008), available at http://www.iilj.org/publications/documents/2OO8-5.Alvare2Khamsi.pdf.
10. Audio recording: Detlev Vagts, Arbitration's Fall from Grace, Conference on the Backlash Against Investment Treaty Arbitration, held by the International Law Society and Harvard Law School (Apr. 19, 2008), available at http://www.law.harvard.edu/students/orgs/ils/2008-04-19-grad-backlashvsinvest-l. mp3.
11. Alvarez &Khamsi, supra note 6, at 4.
12. UNCTAD, Latest Developments in Investor-State Dispute Settlement, 2, U.N. Doc. UNCTAD/WEB/ ITE/IIA/2006/11 (2006);
13. William W. Burke-White &Andreas von Staden, Investment Protection in Extraordinary Times: The Interpretation and Application of Non-Precluded Measures Provisions in Bilateral Investment Treaties, 48 VA. J. INT'L L. 307, 311 (2008);
14. see also infra Part V.A.3.
15. Already, two parallel investment treaty arbitrations against the Czech Republic have generated contradictory rulings. Compare CME Czech Republic B.V. (Neth.) v. Czech Republic (Sept. 13, 2001) (Partial Award), reprinted in 9 ICSID Rep. 121 (2006) with Lauder v. Czech Republic (Sept. 3, 2002) (Final Award), reprinted in 9 ICSID Rep. 66 (2006).
16. See CMS Gas Transmission Co. v. Argentine Republic, ICSID Case No. ARB/01/8 (May 12, 2005) (Award of the Tribunal), reprinted in 44 l.L.M. 1205, \\ 23, 30, 34 (2005);
17. Enron Corp. v. Argentine Republic, ICSID Case No. ARB/01/3 (May 22, 2007) (Award), \\ 288-345, available at http://ita.law. uvic.ca/documents/ Enron-Award.pdf; Sempra Energy Int'l v. Argentine Republic, ICSID Case No. ARB/ 02/16 (Sept. 28, 2007) (Award of the Tribunal), \\ 247-61, available at http://icsid.worldbank.org/ICSID/FrontServlet?requestType=CasesRH&actionVal= ShowDoc&docId=DC694-En&caseId=C8
18. cf. LG&E Energy Corp. v. Argentina Republic, ICSID Case No. ARB/02/1 (Oct. 3, 2006) (Decision on Liability), reprinted in 46 l.L.M. 40, f 226-66 (2007).
19. See Burke-White &von Staden, supra note 9, at 311.
20. Press Release, Int'l Ctr. for Settlement of Inv. Disputes [ICSID], Bolivia Submits a Notice Under Article 71 of the ICSID Convention (May 16, 2007), http://icsid.worldbank.org/ICSID/FrontServlet?requestType= CasesRH&actionVaI=OpenPage&PageType=announcementsFrame&FromPage= NewsReleases&pageName=Announcement3. Note that foreign investors can still claim the BIT protections under other arbitral institutions and facilities such as UNCITRAL.
21. See Convention on the Settlement of Investment Disputes Between States and Nationals of Other States, Mar. 18, 1965, 17 U.S.T. 1270, 575 U.N.T.S. 159 [hereinafter ICSID Convention].
22. UNCTAD, Recent Developments 2008, supra note 1, at 6; see Ecuador's Notification under Article 25(4) of the ICSID Convention, Letter from Maria Fernanda Espinosa Garces, Minister of Foreign Relations, Ecuador, to Ana Palacio, Secretary General, ICSID, (Dec. 5, 2007), available at http://icsid.woHdbank.org/ICSID/FrontServlet?requestType= ICSIDPublicationsRH&actionVal=ViewAnnouncePDF&An nouncementType= Regular&AnnounceNo=9pdf [hereinafter Ecuador's Notification].
23. UNCTAD, Recent Developments, supra note 1, at 4, 6.
24. Specifically, India omitted the fair and equitable treatment and most-favored nation treatment obligations. Mahnaz Malik, Int'l Institute for Sustainable Dev. [USD], Recent Developments in Regional and Bilateral Investment Treaties 7 (2nd Annual Forum for Developing Country Investment Negotiators, Background Paper, Nov. 3-4, 2008), available at http://www.iisd.org/pdf/2008/dci-recent-dev-bits.pdf [hereinafter USD, Recent Developments);
25. see Comprehensive Economic Cooperation Agreement Between the Republic of India and the Republic of Singapore, India-Sing., June 29, 2005, available at http://www.bilaterals.org/IMG/pdf/India-SGP-CECA-2005.pdf.
26. Set Alvarez &Khamsi, supra note 6, at 5-7.
27. Official Statement, NAFTA Free Trade Comm'n, Notes of Interpretation of Certain Chapter 11 Provisions (July 31, 2001), http://www.state.gov/documents/ organization/38790.pdf [hereinafter NAFTA Notes of Interpretation]; see Metalclad v. United Mexican States, ICSID Case No.ARB(AF)/97/ 1 (Aug. 30, 2000) (Award of the Tribunal), \\ 23-27, reprinted in 5 ICSID Rep. 212 (2002) (construing "fair and equitable treatment" to encompass obligations of transparency);
28. see also Pope &Talbot, Inc. v. Canada, UNCITRAL/NAFTA Arbitration (Apr. 10, 2001) (Award on the Merits), rtprimtd in 41 I.L.M. 1347, 1357 (holding that fair and equitable treatment requires not only compliance with international law, but also with the "ordinary standards" of fairness);
29. S.D. Myers, Inc. v. Canada, UNCITRAL/NAFTA Arbitration (Nov. 13, 2000) (Partial Award), 6, available at http://ita.law.uvic.ca/documents/ SDMeyers-lstPartialAward.pdf (holding that the infringement of any "rule of international law . . . specifically designed to protect investors will tend to weigh heavily in favour of finding a breach of Article 1105").
30. Anthony DePalma, NAFTA's Powerful Little Secret, N.Y. TIMES, Mar. 11, 2001, § 3 (Money &Business), at 1.
31. See Methanex v. United States, UNCITRAL/NAFTA Arbitration (Jan. 15, 2001) (Decision of the Tribunal on Petitions from Third Persons to Intervene as Amici Curiae), reprinted in 7 ICSID Rep. 224 (2003);
32. see also Aguas Provinciales de Santa Fe S.A., Suez, Sociedad General de Aguas de Barcelona S.A. v. Argentine Republic, ICSID Case No. ARB/03/17 (Mar. 17, 2006) (Order in Response to a Petition for Participation as Amicus Curiae), available at http://icsid.worldbank.org/ICSID/ FrontServletPrequestType=CasesRH&actionVal=ShowDoc&docId=DC512-Ena: caseId=C18
33. Glamis Gold, Ltd. v. United States, UNCITRAL/NAFTA Arbitration (Sept. 16, 2005) (Decision on Application and Submission by Quechan Indian Nation), available at http://ita.law.uvic.ca/documents/12Decision-000.pdf
34. Suez, Sociedad General de Aguas de Barcelona, S.A. v. Argentine Republic, ICSID Case No. ARB/03/19 (Feb. 12, 2007) (Order in Response to a Petition by Five Non-Governmental Organizations for Permission to Make an Amicus Curiae Submission), available at http://icsid.worldbank.org/ICSID/ FrontServletPrequest Type=CasesRH-actionVal=ShowDoc&docId=DC519- En&caseId=C19;
35. United Parcel Service of America, Inc. v. Canada, UNICTRAL/NAFTA Arbitration (Oct. 17, 2001) (Decision of the Tribunal on Petitions for Intervention and Participation as Amici Curiae), 2001 WL 34804267.
36. See, e.g., Biwater Gauff (Tanzania) Ltd. v. Tanzania, Procedural Order No. 5, ICSID Case No. ARB/05/22, (Feb. 2, 2007), available at http://ita.law.uvic.ca/documents/Biwater-P05.pdf (permitting amicus briefs from the Lawyer's Environmental Action Team, the Legal and Human Rights Centre, the Tanzania Gender Networking Programme, the Center for International Environmental Law, the International Institute for Sustainable Development, all voicing concern);
37. see also Council of Canadians, Court Upholds Corporate Rights Under NAFTA (Nov. 30, 2006), http://www.canadians.org/trade/documents/ NAFTA-analysis-Nov30-06.pdf (for criticism of court decision finding NAFTA constitutional);
38. USD, Bilateral Investment Treaties and Development Policy Making (Nov. 2004), available at http://www.iisd. org/pdf/2004/trade-bits.pdf; USD, PRIVATE RIGHTS, PUBLIC PROBLEMS: A GUIDE TO NAFTA's cONTROVERSIAL cHAPTER ON iNVESTOR rIGHTS (2001), available at http://www.iisd.org/pdf/trade- citizensguide. pdf; Public Citizen, NAFTA Chapter Investor-to-State Cases: Bankrupting Democracy (Sept. 2001), http://www.citizen.org/documents/ACF186.PDF.
39. See Office of the U.S. Trade Representative, 2004 Model Bilateral Investment Treaty (2004), available at http://www.ustr.gov/assets/Trade- Sectors/Investment/Model-BIT/asset-upload-file847- 6897.pdf [hereinafter 2004 U.S. Model BIT].
40. See Kingdom of Norway, Norway 2007 Model BIT Draft (Dec. 19, 2007), available at http://ita. law.uvic.ca/investmenttreaties.htm.
41. See Jose E. Alvarez, The Evolving Foreign Investment Regime, IL.post (AM. SOC'Y OF INT'L LAW, Washington, D.C.), Feb. 29, 2008, http://www.asil.org/ilpost/president/ pres080229.html.
42. See Methanex v. United States, UNCITRAL/NAFTA Arbitration (Aug. 7, 2002) (Partial Award), 1103, reprinted in 7 ICSID Rep. 239 (2005).
43. USD, Recent Developments, supra note 16, at 10-13.
44. The use of property rights terminology is used to convey the notion that BITs provide foreign investors with an enforceable right to property on the international plane. The "property" in question is the investment, which may not be protected under national law.
45. Stefan D Amarasinha &Juliane Kokott, Multilateral Investment Rules Revisited, in THE OXFORD HANDBOOK OF INTERNATIONAL INVESTMENT LAW 120 (Peter Muchlinski, Federico Ortino &Christoph Schreuer eds., 2008) [hereinafter OXFORD HANDBOOK];
46. Joachim Delaney &Daniel Barstow Magraw, Procedural Transparency, in OXFORD HANDBOOK, supra; GUS VAN HARTEN, INVESTMENT TREATY ARBI- TRATION AND PUBLIC LAW 180-84 (2007);
47. LOUIS T. WELLS &RAFIQ AHMED, MAKING FOREIGN INVESTMENT SAFB: PROPERTY RIGHTS AND NATIONAL SOVEREIGNTY 295 (2007);
48. Memorandum from Karl P. Sauvant, Executive Dir., Vale Columbia Ctr. on Sustainable Int'l Inv., and other colleagues ar Columbia Univ., to the Office of the President, Sec'y of State, Sec'y of the Treasury, Dir. of the Nat'l Econ. Council, and U.S. Trade Representative (Jan. 29, 2009), available at http://www.vcc.columbia.edu/events/documents/ MemoonImprovingIntlInvestmentRegime-2Feb09.pdf.
49. UNCTAD, Recent Developments 2008, supra note 1.
50. See UNCTAD, World Investment Report 2008: Transnational Corporations, and the Infrastructure Challenge, at iii, U.N. Doc. UNCTAD/WIR/2008 (Sept. 24, 2008) [hereinafter UNCTAD, World Investment Report 2008];
51. UNCTAD, Foreign Direct Investment and Financing for Development: Trends and Selected Issues, at 3-7, U.N. Doc. TD/B/COM.2/80 (Dec. 7, 2007);
52. see also Eric Neumayer &Laura Spess, Do Bilateral Investment Treaties Increase Foreign Direct Investment to Developing States, 33 WORLD DEV. 1567, 1568-69 (2005);
53. WORLD BANK, GLOBAL DEVELOPMENT FINANCE: FINANCING THE POOREST COUNTRIES. ANALYSIS AND SUMMARY TABLES, COUNTRY TABLES (2002).
54. UNCTAD, World Investment Report 2003: FDI Policies for Development: National and International Perspectives, at 4, U.N. Doc. UNCTAD/WIR/2003 (Apr. 9, 2008) [hereinafter UNCTAD, World Investment Report 2005].
55. Mary Hallward-Driemeier, Do Bilateral Investment Treaties Attract Foreign Direct Investment? Only a Bit. .. and They Could Bite 2-4 (World Bank, Policy Research Working Paper No. 3121, 2003), available at http://ssrn.com/abstract=636541.
56. Id.
57. UNCTAD, Trends in Rulemaking, supra note 1.
58. UNCTAD, Bilateral Investment Treaties: 1959-99, at 4, U.N. Doc. UNCTAD/ITE/IIA/2 (2000) [hereinafter UNCTAD, BITs 1959-99]. BITs are rarely concluded between countries where FDI flows in both directions, i.e., between OECD countries. UNCTAD suggests that the dearth of BITs between developed countries is attributable to the existence of instruments adopted under the auspices of the OECD, to which all developed countries belong.
59. Id. But see the recent Japan-Switzerland Economic Partnership Agreement, which includes an investment chapter, for a counterexample. Agreement on Free Trade and Economic Partnership Between Japan and the Swiss Confederation, Japan-Switz., ch. 9, Feb. 9, 2009, available at http://www.mofa.go.jp/region/europe/switzerland/epa0902/agreement.pdf (last visited Mar. 15, 2009).
60. Hallward-Driemeier, supra note 32, at 8. In 2007, developed countries accounted for more than eighty-four percent of outflows and sixty-eight percent of FDI inflows. UNCTAD, World Investment Report 2008, supra note 30, Annex B.l, at 247.
61. M. SORNARAJAH, THE SETTLEMENT OF FOREIGN INVESTMENT DISPUTES 159 (2000).
62. BISHOP, CRAWFORD &REISMAN, supra note 5, at 2-3 (2005);
63. ANDREW NEWCOMBE &IUFS PARADELL, LAW AND PRACTICE OF INTERNATIONAL INVESTMENT TREATIES 3-11 (2008).
64. NEWCOMBE &PARADELL, supra note 38;
65. Jeswald W. Salacuse, BIT by BIT: The Growth of Bilateral Investment Treaties and Their Impact on Foreign Investment in Developing Countries, 24 INT'L L. 655, 663-65, 675 (1990). There is some dispute about whether the host state's obligation is a classical international obligation, owed in principle to the home state of the investor, or whether the investor holds new and independent rights of action against the host state. See Zachary Douglas, The Hybrid Foundation of Modern Investment Treaty Arbitration 74 BRIT. Y.B. INT'L L. 151 (2004).
66. BISHOP, CRAWFORD &REISMAN, supra note 5, at 19
67. Id. at 10;
68. Salacuse, supra note 39, at 667-68;
69. see also M. SORNARAJAH, THE I NTERNATIONAL LAW ON FOREIGN INVESTMENT 233-58 (2004) [hereinafter SORNARAJAH, 2004].
70. Salacuse, supra note 39, at 670-73.
71. So, for example, developing countries concluded several different kinds of BITs, depending on the liberalization preferences of their developed country treaty partner. Set UNCTAD, Trends in Rulemaking, supra note 1, at 143-44.
72. Kenneth J. Vandevelde, The BIT Program: A Fifteen Year Appraisal, 86 AM. SOC'Y INT'L L. PROC. 532. 538 (1992) Thereinafter Vandevelde. ASIL Proceedings!.
73. International human rights law is the other significant realm of protection tor individuals under international law. See VAN HARTEN, supra note 28, at 10 (noting the lack of similar protections for migrant workers, refugees, and indigenous peoples).
74. United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards arts. 3, 4, June 10, 1958, 330 U.N.T.S. 38 [hereinafter New York Convention];
75. ICSID Convention, supra note 13, arts. 53-55.
76. Jan Paulsson, Arbitration Without Privity, 10 ICSID REV.: FOREIGN INV. L.J. 232, 234-35 (1995).
77. VAN HARTEN, supra note 28, at 5.
78. Zachary Elkins, Andrew T. Guzman Sc Beth A. Simmons, Competing for Capital: The Diffusion of Bilateral Investment Treaties, 1960-2000, 60 INT'L ORG. 811, 812 (2006).
79. See Antony Anghie, Imperialism, Sovereignty and the Making op International Law 224 (2004).
80. Iran nationalized British oil assets in 1951; Libya expropriated Liamco's concessions in 1955; Egypt nationalized the Suez Canal in 1956; Cuba nationalized sugar interests in the 1960s. Elkins, Guzman Sc Simmons, supra note 49, at 813;
81. see also BISHOP, CRAWFORD Sc REISMAN, supra note 5, at 4-5;
82. Nico SCHRIJVER, SOVEREIGNTY OVER NATURAL RESOURCES: BALANCING RIGHTS AND DUTIES 41 (1997);
83. HENRY J. STEINER, DETLEV F. VAGTS ¶HAROLD HONGJU KOH, TRANSNATIONAL LEGAL PROBLEMS 466 (4th ed. 1994).
84. BISHOP, CRAWFORD &REISMAN, supra note 5, at 5.
85. Permanent Sovereignty over Natural Resources, G.A. Res. 1803 (XVII), 15, U.N. Doc. A/5217 (Dec. 14, 1962), reprinted in 2 l.L.M. 223 (1963) [hereinafter Resolution 1803].
86. SCHRIJVER, supra note 51, at 3.
87. Id. at 20-22.
88. Id. at 85.
89. Resolution 1803, supra note 53, 4.
90. Id. 18.
91. SCHRIJVER, supra note 51, at 83.
92. Charter of Economic Rights and Duties of States, G.A. Res. 3281 (XXIX), U.N. Doc. A/9631 (Dec. 12, 1974), reprinted in 14 l.L.M. 251 (1975) [hereinafter 1974 Charter];
93. see also Declaration on the Establishment of a New International Economic Order, G.A. Res. 3201 (S-VI), U.N. Doc. A/9559 (May 1, 1974), reprinted in 13 l.L.M. 715 (1974);
94. Programme of Action on the Establishment of a New International Economic Order, G.A. Res. 3202 (S-VI), U.N. Doc. A/9559 (May 1, 1974), reprinted in 13 I.L.M. 729 (1974).
95. 1974 Charter, supra note 60, art. 2, 2(c).
96. 1974 Charter, supra note 60, at 265; see Andrew T. Guzman, Why LDCs Sign Treaties That Hurt Them: Explaining the Popularity of Bilateral Investment Treaties, 38 VA. J. INT'L L. 639, 648-51 (1998).
97. Guzman, supra note 62, at 658-61.
98. Jose E. Alvarez, The Development and Expansion of Bilateral Investment Treaties: Remarks, 86 AM. SOC'Y INT'L L. PROC. 532, 555 (1992) [hereinafter Alvarez, ASIL Proceedings].
99. Kenneth J. Vandevelde, The Political Economy of a Bilateral Investment Treaty, 92 AM. J. INT'L L. 621, 621 (1998) [hereinafter Vandevelde, Political Economy].
100. Alvarez, ASIL Proceedings, supra note 64, at 532.
101. See Guzman, supra note 62.
102. Id. at 644-49. This rule was named for Secretary of State Cordell Hull, who articulated the rule in 1940 in response to takings of U.S. national property by Mexico. See Aliens, 3 Hackworth, DIGEST § 889, at 658-59.
103. SORNARAJAH, 2004, supra note 41, at 213.
104. UNCTAD, BITs 1959-99, supra note 35, at 17-20;
105. Neumayer &Spess, supra note 30, at 1568-69;
106. Jeswald W. Salacuse &Nicholas P. Sullivan, Do BITs Really Work?: An Evaluation of Bilateral Investment Treaties and Their Grand Bargain, 46 HARV. INT'L L.J. 67, 69 n.10 (2005);
107. Kenneth J. Vandevelde, Sustainable Liberalism and the International Investment Regime, 19 MICH. INT'L L.J. 373, 386-90 (1998) {hereinafter Vandevelde, Sustainable Liberalisms.
108. ANGHIE, supra note 50, at 223.
109. Interview by Sean Silverthorne with Louis T. Wells, Professor, Harvard Business School, Risky Business? Protecting Foreign Investment (Mar. 5, 2007), available at http://hbswk.hbs.edu/faculty/lwells. html.
110. Guzman, supra note 62, at 652-53;
111. SCHRIJVER, supra note 51, at 174-75, 190-91.
112. Audio recording: William Burke-White, The Suspension of Host Country Obligations in Economic Emergencies, Conference on the Backlash Against Investment Treaty Arbitration, held by the International Law Society, and Harvard Law School (Apr. 19, 2008), available at http://www.law.harvard. edu/students/orgs/ils/2008-04-19-grad-backlashvsinvest-l.mp3.
113. Alvarez &Khamsi, supra note 6, at 4.
114. Elkins, Guzman &Simmons, supra note 49, at 823. In some countries, investment insurance schemes require the signature of BITs.
115. Id.
116. Guzman, supra note 62, at 666-67.
117. See infra Part II.C.2.
118. Rosa Marie Lastra, The International Monetary Fund in Historical Perspective, 3 J- INT'L ECON. L. 507, 507-08 (2000).
119. RICHARD PEET, UNHOLY TRINITY: THE IMF, WORLD BANK AND WTO 56 (2003);
120. NGAIRE WOODS, THE GLOBAUZERS: THE IMF, THE WORLD BANK, AND THEIR BORROWERS 7 (2006).
121. William E. Holder, Exchange Rate Policies: The Role and Influence of the International Monetary Fund, 80 AM. SOC'Y INT'L L. PROC. 29, 30 (1986);
122. Lastra, supra note 80, at 514.
123. Lastra, supra note 80, at 514.
124. Saskia Sassen, Lecture at Harvard Law School (Mar. 13, 2008) (notes on file with Harvard International Law Journal);
125. see SASKIA SASSEN, TERRITORY, AUTHORITY, RIGHTS 157-63, 222-76 (2006).
126. PEET, supra note 81, at 73;
127. Ariel Buira, An Analysis of IMF Conditionality, in CHALLENGES TO THE WORLD BANK AND IMF: DEVELOPING COUNTRY PERSPECTIVES 55, 61-63 (Ariel Buira ed., 2003).
128. The IMF issued new Conditionality Guidelines in 2002, but they do not constrain the IMF's policies in any meaningful sense. IMF, GUIDELINES ON CONDITIONALITY, DECISION NO. I (2002) available at http://74.125.93 104/search?q=Cache: Yvik-gVm7ncJ:www.imf. org/External/np/pdr/cond/2002/eng/guid/092302. pdf+imf+guidelines+on+conditionality+decision+no.+i+Sept+25+2002&cd= l&hl=en&ct=clnk&gl=us&client=firefox-a;
129. see Daniel Kalderimis, IMF Conditionality as Investment Regulation: A Theoretical Analysis, 13 SOC. &LEGAL STUD. 103, 112 (2004).
130. PEET, supra note 81, at 111.
131. CHRISTOPHER L. GILBERT &DAVID VINES, The World Bank: An Overview of Some Major Issues, in THE WORLD BANK: STRUCTURE AND POLICIES 10, 12 (Christopher L. Gilbert &David Vines eds., 2000).
132. See Articles of Agreement of the International Bank for Reconstruction and Development art. 1(2), Dec. 27, 1945, 60 Stat. 1440, 2 U.N.T.S. 134 [hereinafter Bretton Woods, IBRD].
133. SCHRIJVER, supra note 51, at 185-88. MIGA has a mandate to promote investment agreements. See Convention Establishing the Multilateral Investment Guarantee Agency art. 23, Oct. 11, 1985, 1508 U.N.T.S. 99, 24 I.L.M. 1605, 1616 (1985);
134. IBRAHIM SHIHATA, LEGAL TREATMENT OF FOREIGN INVESTMENT 34-35 (1993). Although ICSID and MIGA are independent of the World Bank, they are affiliate institutions of the World Bank Group. For ICSID, there is membership overlap. See, for example, Article 5 of the ICSID Convention establishing that the President of the World Bank is also the Chairman of ICSID's Administrative Council. It is also ICSID's general practice to appoint the Senior Vice President and General Counsel of the World Bank to be Secretary General of ICSID.
135. See also 2 WORLD BANK, LEGAL FRAMEWORK FOR THE TREATMENT OF FOREIGN INVESTMENT: REPORT TO THE DEVELOPMENT COMMITTEE AND GUIDELINES ON THE TREATMENT OF FOREIGN DIRECT INVESTMENT (1992).
136. JOSEPH STIGLITZ, GLOBALIZATION AND ITS DISCONTENTS 14 (2003).
137. PEET, supra note 81, at 121.
138. STIGLITZ, supra note 91, at 44.
139. Kalderimis, supra note 86, at 119
140. It is difficult to obtain precise information about the nature of IMF conditionalities. The IMF made its database of conditionalities available in January 2009, but only from 2002 forward. IMF, Monitoring of Fund Arrangements (MONA) (2009), http://www.imf.org/external/np/pdr/mona/index.aspx.
141. But see Letter of Intent from Juloi de Brun, President, &Isaac Alfie, Minister of Econ. and Fin., Oriental Republic of Uruguay, to Horst Kohler, Managing Dir., IMF (Feb. 6, 2004), http://www.imf.org/ external/np/loi/2004/ury/01/index.htm ("The government will continue to promote a business climate that facilitates investment. Efforts to promote foreign direct investment will build on the successful award in August 2003 of the concession to operate the Montevideo airport. Negotiations on a bilateral investment treaty have been initiated with the United States. A two-year extension of fiscal incentives has been granted for investment projects that were delayed during the economic crisis in 2002.");
142. see also LLSHALA C. SLTUMBEKO &JACK JONES ZULU, WORLD DEV. MOVEMENT, ZAMBIA: CONDEMNED TO DEBT: HOW THE IMF AND WORLD BANK HAVE UNDERMINED DEVELOPMENT 52 (2004) (reporting that Zambia's Investment Act, which increased protection for foreign investors, was a condition of a World Bank reform credit) (cited in VAN HARTEN, supra note 28, at 42 n.157);
143. SORNARAJAH, 2004, supra note 41, at 208 n.6 (2004).
144. John Williamson, What Washington Means by Policy Reform, in LATIN AMERICAN ADJUSTMENT: HOW MUCH HAS HAPPENED? 5, 5-20 (John Williamson ed., 1990);
145. Vandevelde, Sustainable Liberalism, supra note 70.
146. See John Williamson, A Short History of the Washington Consensus, in THE WASHINGTON CONSENSUS RECONSIDERED: TOWARDS A NEW GLOBAL GOVERNANCE 14, 21 (Narcis Serra &Joseph E. Stiglitz eds., 2008).
147. In the past, the IMF acted as a credit flagship for the private sector-if the IMF would not lend to the country, then private banks would follow suit.
148. See, e.g., STIGLITZ, supra note 91, at 42-44; Ariel Buira, An Analysis of IMF Conditionality, in CHALLENGES TO THE WORLD BANK AND IMF: DEVELOPING COUNTRY PERSPECTIVES 55, 60-62 (Ariel Buira ed., 2004).
149. Elkins, Guzman &Simmons, supra note 49, at 833;
150. SORNARAJAH, 2004, supra note 41, at 2, 207-08.
151. Elkins, Guzman &Simmons, supra note 49, at 840;
152. CMS Gas Transmission Company v. Argentina, ICSID Case No. ARB/01/8 (July 17, 2003) (Decision on Objections to Jurisdiction), reprinted in 42 l.L.M. 788, 797 (2003) (stating that invitations to foreign investors during privatization efforts in the 1990s expressly mentioned investment treaty protections).
153. Alvarez, ASIL Proceedings, supra note 64, at 552.
154. Kalderimis, supra note 86, at 108-11.
155. STIGUTZ, supra note 91, at 67.
156. Organization of Economic Cooperation and Development [OECD], Recent Trends in Foreign Direct Investment, in INT'L INV. PERSPECTIVES 23 (2003).
157. See Bretton Woods, IBRD, supra note 89, art. 1(2).
158. See Salacuse &Sullivan, supra note 70, at 71.
159. Note that this Article does not reach the effects of FDI inflows on economic development.
160. See Salacuse &Sullivan, supra note 70, at 71;
161. see also Vandevelde, Political Economy, supra note 65, at 627.
162. 109- Salacuse &Sullivan, supra note 70, at 77.
163. Rudolf Dolzer, The Impact of International Investment Treaties on Domestic Administrative Law, 37 N.Y.U. J. INT'L L. &POL. 953, 953 (2005).
164. 2004 U.S. Model BIT, supra note 22. Luke Eric Peterson notes that references to development are rare in treaties signed by the United Kingdom, Canada, and Switzerland. LUKE ERIC PETERSON, BILATERAL INVESTMENT TREATIES AND DEVELOPMENT POLICY-MAKING 16-17 n.44 (2004), available at http://www.iisd.org/pdf/2004/trade-bits.pdf [hereinafter PETERSON (2004)].
165. UNCTAD, Investment Promotion Provisions in International Investment Agreements, at 3, 61, UNCTAD/ITE/IIT/2007/7 (2008) (indicating that "only a small minority of IIAs contain specific investment promotion provisions" and later that "[traditionally, investment promotion provisions have had their place in the preambles of IIAs");
166. see also UNCTAD, Trends in Rulemaking, supra note 1, at 145.
167. The preamble constitutes part of the context of the treaty for the purposes of interpretation. Vienna Convention on the Law of Treaties art. 31, May 23, 1969, 155 U.N.T.S. 331; UNCTAD, Trends in Rulemaking, supra note 1, at 3.
168. UNCTAD, Trends in Rulemaking, supra note 1, at 145.
169. Indeed, in the early years of the U.S. BIT program, the program expressly disclaimed investment promotion as a goal of BITs.
170. See Vandevelde, ASIL Proceedings, supra note 44, at 535.
171. See, e.g., Hallward-Driemeier, supra note 32. A central issue beyond the scope of this Article is the correct counterfactual to be employed in evaluating these studies. The comparison ought to examine whether the host state receives more FDI from the investor state with or without a BIT. One of the empirical difficulties with these studies is the existence of a BIT, meaning that the counterfactual can only be estimated. I am indebted to Michael Waibel for this observation.
172. M. Sornarajah, State Responsibility and Bilateral Investment Treaties, 20 J. WORLD TRADE L. 79, 82 (1986) [hereinafter Sornarajah, 1986].
173. See UNCTAD, Bilateral Investment Treaties in the Mid-1990s, at 122, U.N. Doc. UNCTAD/ITE/ IIT/7 (1998); UNCTAD, Transnational Corporations in World Development: Trends and Prospects, at 337, U.N. Doc. ST/CTC/89 (1988);
174. WORLD BANK, GLOBAL ECONOMIC PROSPECTS OF DEVELOPING COUNTRIES xvii (2003).
175. UNCTAD, Bilateral Investment Treaties in the Mid-1990s, 122, U.N. Doc. UNCTAD/ITE/IIT/7 (1998); UNCTAD, Transnational Corporations in World Development: Trends and Prospects, 337, U.N. Doc. ST/CTC/89 (1988).
176. WORLD BANK, supra note 118 at xvii. The Report was based on the study by Mary Hallward- Driemeier. See Hallward-Driemeier, supra note 32.
177. Hallward-Driemeier, supra note 32, at 22-23. Determining the validity of this study would require analysis beyond the scope of this Article. For example, one would want to examine when the pro- FDI policies took effect and whether the study covers only post-BIT signature FDI flows. I am grateful to Michael Waibel for this observation.
178. Jennifer Tobin &Susan Rose-Ackerman, Foreign Direct Investment and the Business Environment in Developing Countries: The Impact of Bilateral Investment Treaties (Yale L. &Econ. Research Paper No. 293, May 2, 2005), htrp.7/ssrn.com/abstract=557121;
179. see also Elkins, Guzman &Simmons, supra note 49; Salacuse &Sullivan, supra note 70 (finding a positive effect for U.S. BITs but not for BITs from other OECD countries); Jason W. Yackee, Sacrificing Sovereignty: Bilateral Investment Treaties, International Arbitration and the Quest for Capital (U.S.C. CLEO Research Paper No. C06-15, Nov. 2006), http:// wage.wise.edu/events/archive/?ID=294. For three studies presenting evidence suggesting that BITs have a positive effect on FDI inflows, see Peter Egger &Michael Pfaffermayr, The Impact of Bilateral Investment Treaties on Foreign Direct Investment, 32 J. COMP. ECON. 788 (2004);
180. Neumayer &Spess, supra note 30; Deborah L. Swenson, Why Do Developing Countries Sign BITs?, 12 U.C. DAVIS J. INT'L L. &POL'Y 131, 152-55 (2005).
181. UNCTAD, Total Number of Bilateral Investment Treaties Concluded: Japan (June 1, 2008), http://www.unctad.org/sections/dite-pcbb/docs/bits- japan.pdf.
182. UNCTAD, Total Number of Bilateral Investment Treaties Concluded: China (June 1, 2008), http://www.unctad.org/sections/dite-pcbb/docs/bits-chitna.pdf.
183. UNCTAD, Total Number of Bilateral Investment Treaties Concluded: Brazil (June 1, 2008), http://www.unctad.org/sections/dite-pcbb/docs/bits-brazil.pdf.
184. Anne van Aaken, Perils of Success? The Case of International Investment Protection, 9 EUR. BUS. ORG. L. REV. 1 (2008).
185. Joachim Karl, International Investment Arbitration: A Threat to State Sovereignty, in REDEFINING SOVEREIGNTY IN INTERNATIONAL ECONOMIC LAW 225, 225, 231-38 (Wenhua Shan, Penelope Simons &Dalvinder Singh eds., 2008).
186. NEIL WALKER, RELOCATING SOVEREIGNTY (2006).
187. John H. Jackson, Sovereignty-Modern: A New Approach to an Outdated Concept, 97 AM. J. INT'L L. 782 (2003).
188. Id. at 790.
189. Dolzer, supra note 110, at 957-68. The "political costs of assembling a coalition in support of foreign investors' rights" are also an issue. Elkins, Guzman &Simmons, supra note 49, at 825.
190. Dolzer, supra note 110, at 960, 970.
191. Elkins, Guzman &Simmons, supra note 49, at 825.
192. Some domestic laws will continue to apply to the foreign investor, but the investor is not subject to domestic courts.
193. Elkins, Guzman &Simmons, supra note 49, at 825. This is heightened by the lack of subsidiarity in the regime and any domestic remedies exhaustion requirement.
194. Dolzer, supra note 110, at 957.
195. Asoka de Z. Gunawardana, The Inception and Growth of Bilateral Investment Promotion and Protection Treaties, 86 AM. SOC'Y INT'L L. PROC. 544, 546 (1992).
196. Alvarez, ASIL Proceedings, supra note 64, at 553 (Professor Alvarez uses the "take-it-or-leave-it" character of the U.S. Model BIT to argue that the U.S. understanding of the BIT should be given high probative value in the context of the Argentina arbitrations-he filed expert reports for the investor in several cases);
197. see also Alvarez &Khamsi, supra note 8, at 82-83; Salacuse, supra note 39, at 662-64.
198. I am indebted to Luke Peterson for this point.
199. Elkins, Guzman &Simmons, supra note 49, at 812, 814, 843.
200. Id. at 825.
201. Hallward-Driemeier, supra note 32, at 7.
202. Alvarez, ASIL Proceedings supra note 64, at 553-54.
203. Id. at 554.
204. The umbrella clause has been the subject of varying and still unsettled interpretations by tribunals. For an overview of the jurisprudence, see James Crawford, Treaty and Contract in Investment Arbitration, The 22nd Freshfields
205. WELLS &AHMED, supra note 28, at 5-6.
206. David Schneiderman, Investment Rules and the Rule of Law, 8 CONSTELLATIONS 521, 521-22 (2001).
207. Vandevelde, Political Economy, supra note 65, at 626.
208. MICHAEL P. TODARO, ECONOMIC DEVELOPMENT 533-34 (5th ed. 1994);
209. see also Amy L. Chua, The Privatization-Nationalization Cycle: The Link Between Markets and Ethnicity in Developing Countries, 95 COLUM. L. REV. 223 (1995);
210. U.N. Transnat'l Corp. &Mgmt. Division [UNTCMD], Formulation and Implementation of Foreign Investment Policies, at 25-26, U.N. Doc. E.92.II.A.21 (1992).
211. EDWARD M. GRAHAM &PAUL R. KRUGMAN, FOREIGN DIRECT INVESTMENT IN THE UNITED STATES 86-93 (3d ed. 1995).
212. Jeff Weintraub, The Theory and Politics of the Public/Private Distinction, in PUBLIC AND PRIVATE IN THOUGHT AND PRACTICE 1, 2 (Jeff Weintraub &Krishan Kumar eds., 1997).
213. It must be acknowledged that binaries subsume other binaries, are not fixed concepts, may be used to oppress or harm, and do not always neatly fit reality. They are nonetheless a useful construct, particularly in the face of complex and unresolved historical patterns.
214. Earlier international economic dispute settlement mechanisms, including those following the General Agreement on Tariffs and Trade treaty and the espousal of investor claims by home states, were necessarily often a mix of public and private, given the interests involved. However, they were state-to- state mechanisms on the international plane. See NEWCOMBE & PARADEU., supra note 39, at 3-11.
215. Benedict Kingsbury, Sovereignly and Inequality, 9 EUR. J. INT'L L. 599 (1998).
216. See NEWCOMBE & PARADELL, supra note 39, at 24.
217. RUDOLF DOLZER & CHRISTOPH SCHREUER, PRINCIPLES OP INTERNATIONAL INVESTMENT LAW 12 (2008).
218. ANGHIE, supra note 50, at 226.
219. There is an ongoing debate as to whether the right to bring a claim "belongs" to the foreign investor, or whether the investor's right is derived from the state. See, e.g., Andrea Bjorklund, Private Rights and Public International Law: Why Competition Among International Economic Law Tribunals Is Not Working, 59 Hastings L.J. 241, 306-07 (2007);
220. Douglas, supra note 39, at 162-64.
221. IOANA TUDOR, THE FAIR AND EQUITABLE STANDARD IN THE INTERNATIONAL LAW OF FOREIGN INVESTMENT 55 (2008).
222. DOLZER & SCHREUER, supra note 156, ac 3.
223. Christoph Schreuer, The Relevance of Public International Law in International Commercial Arbitration 22 (unpublished manuscript), http://www.univie.ac.at/intlaw/pdf/csunpublpaper-l.pdf (last visited Mar. 15, 2009).
224. See UNCTAD, Trends in Rulemaking, supra note 1.
225. Dolzer, supra note 110, at 957.
226. Ronald J. Daniels, Defecting on Development: Bilateral Investment Treaties and the Subversion of the Rule of Law in the Developing World 2 (Mar. 23, 2004) (unpublished manuscript), http://www. unisi.it/lawandeconomics/ stile2004/daniels.pdf.
227. Susan Franck, Foreign Direct Investment, Investment Treaty Arbitration and the Rule of Law, 19 GLOBAL BUS. & DEV. L.J. 337, 368 (2007).
228. New York Convention, supra note 46.
229. SASKIA SASSEN, TERRITORY AUTHORITY RIGHTS: FROM MEDIEVAL TO GLOBAL ASSEMBLAGES 243-45 (2006).
230. See Ecuador's Notification, supra note 14;
231. Statement by the OECD Investment Committee (June 2005), in OECD, Transparency and Third Party Participation in Investor-State Dispute Settlement Procedures 1 (OECD, Working Papers on International Investment No. 2005/1, April 2005) (for demands for third- party participation);
232. L. Yves Fortier & S. L. Drymer, Third-Party Intervention and Document Discovery, 4 J. WORLD INV. 473 (2003). For renegotiation of NAFTA, see Press Release, The Council of Canadians, Growing Majority of Canadians Agree with Obama: Renegotiate NAFTA (Sept. 28, 2008), http://www. canadians.org/media/trade/2008/26-Sep-08.html.
233. A. Claire Cutler, Critical Reflections on the Westphalian Assumptions of International Law and Organizations: A Crisis of Legitimacy\ 27 REV. INT'L STUD. 133, 138 (2001).
234. See, e.g., Daniela Caruso, The Missing View of the Cathedral: The Private Law Paradigm of European Legal Integration, 3 EUR. LJ. 3, 3-5 (1997);
235. DUNCAN KENNEDY, The Stages of Decline of the Public-Private Distinction, 130 U. PA. L. REV. 1349, 1349 (1982).
236. Gus Van Harten, The Public-Private Distinction in the International Arbitration of Individual Claims Against the State, 56 INT'L & COMP. L.q. 371, 372 (2007) {hereinafter VAN HARTEN, 2007].
237. See Cutler, supra note 169, at 138.
238. See Sornarajah, 1986, supra note 117, at 81.
239. See Cutler, supra note 169, at 144.
240. ANGHIE, supra note 50, at 234.
241. This statement is subject to the full protection and security obligation in BITs, which has been held to protect foreign investors against certain limited private incursions. Under this treaty obligation, the state should exercise due diligence to protect against private interference that rises to a certain level, such as mob violence. See, e.g., AMCO Asia v. Indonesia, ICSID Case No. ARB/81/1 (Nov. 20, 1984) (Award), reprinted in 1 ICSID Rep. 413 (1993).
242. Van Harten, 2007, supra note 171, at 393; Anne Orford, Locating the International: Military and Monetary Interventions After the Cold War, 38 HARV. INT'L LJ. 443, 472-74 (1997).
243. See L.J. Kerr, Commercial Dispute Resolution: The Changing Scene, in LIBER AMICORUM FOR THE RT. HON. LORD WILBERFORCE 111, 120 (Maarten Bos & Ian Brownlie eds., 1987).
244. 179- Christopher R. Drahozal, Commercial Norms, Commercial Codes, and International Commercial Arbitration, 33 Vanderbilt J. INT'L L. 79, 82-83 (2000).
245. Robert Clow & Patrick Stewart, International Arbitration: Storming the Citadels, 9 INT'L FIN. L. REV. 10, 10-13 (Mar. 1990);
246. HANS SMIT, BOOK REVIEW, 34 AM. J. COMP. L. 395, 395 NN.1-2 (1986) (REVIEWING RESOLVING TRANSNATIONAL DISPUTES THROUGH INTERNATIONAL ARBITRATION, THE SIXTH SOKOL COLLOQUIUM (Thomas E. Carbonneau ed., 1984)).
247. See Luke Eric Peterson, All Roads Lead Out of Rome: Divergent Paths of Dispute Settlement in BITs, in INTERNATIONAL INVESTMENT FOR SUSTAINABLE DEVELOPMENT 123, 128 (Lyuba Zarsky ed., 2004).
248. Jacques Werner, The Trade Explosion and Some Likely Effects on International Arbitration, 14 J. INT'L ARB. 5, 10-11 (1997).
249. Robert D. Cooter, The Objectives of Private and Public Judges, 41 PUB. CHOICE 107, 107 (1983);
250. accord Robert D. Cooter & Daniel L. Rubinfield, Trial Courts: An Economic Perspective, 24 L. & SOC'Y REV. 533, 545 (1990).
251. VAN HARTEN, supra note 28, at 155, 158 (citing Yves Dezalay, Between State, Law and the Market, in I NTERNATIONAL REGULATORY COMPETITION AND COORDINATION 59, 84-86 (W. Bratton et al. eds., 1996)).
252. See Klaus Peter Berger, International Economic Arbitration, in 9 STUDIES IN TRANSNATIONAL ECONOMIC LAW 8 n.62 (1993).
253. Soia MentschikofT & Ernest Haggard, Decision Making and Decision Consensus in Commercial Arbitration, in LAW, JUSTICE, AND THE INDIVIDUAL IN SOCIETY 295, 307 (June Louin Tapp & Felice J. Levine eds., 1977).
254. See YVES DEZALAY & BRYANT G. GARTH, DEAUNG IN VIRTUE: INTERNATIONAL COMMERCIAL ARBITRATION AND THE CONSTRUCTION OF A TRANSNATIONAL LEGAL ORDER 19, 29 (1996).
255. VAN HARTEN, supra note 28, at 172.
256. DEZALAY, supra note 187, at 10 n.7.
257. INTERNATIONAL INSTITUTE FOR SUSTAINABLE DEVELOPMENT [USD], INVESTMENT, DOHA AND THE WTO 9-U (Sept. 2003);
258. VAN HARTEN, supra note 28, at 172 (citing Ghana v. Telekom Malaysia, Oct. 18, 2004 & Nov. 5, 2004, Case No. HA/RK 2004, 667 and Case No. HA/RK 2004, 788;
259. Compa- fifa de Aguas del Aconquija S.A. v. Argentine Republic, ICSID Case No. ARB/97/3 (Oct. 3, 2001) (Decision on Challenge to President)). So, for example, an arbitrator may simultaneously be acting as counsel in a similar case that will benefit from the broad interpretation of a particular treaty obligation. Although there is no formal system of precedent, argument in arbitration proceeds like argument in litigation by analogizing and distinguishing prior cases.
260. Van Aaken, supra note 126, at 12.
261. PHILIPPE KAHN & THOMAS W. WALDE, NEW ASPECTS OF INTERNATIONAL INVESTMENT LAW 48 (2007).
262. FEDERICO STURZENEGGER & JEROMIN ZETTELMEYER, DEBT DEFAULTS AND LESSONS FROM A DECADE OF CRISES 165 (2006).
263. IMF, INDEP. EVALUATION OFFICE, THE IMF AND Argentina: 1991-2001, at 9 (2004) [hereinafter The IMF AND ARGENTINA].
264. See id. (explaining these external shocks included, inter alia, the Asian and Russian crises of 1997-98 and the Brazilian devaluation in 1999).
265. See STURZENEGGER & ZETTELMEYER, supra note 193, at 179;
266. William W. Burke-White & Andreas von Staden, Investment Protection in Extraordinary Times: The Interpretation and Application of Non- Precluded Measures Provisions in Bilateral Investment Treaties, 48 VA. J. INT'L L. 307, 309 (2008);
267. Van Harten, supra note 28, at 1.
268. STURZENEGGER & ZETTELMEYER, supra note 193, at 200;
269. Van Harten, supra note 28, at 1.
270. PAUL BLUSTEIN, AND THE MONEY KEPT ROLLING IN (and Out): WALL STREET, THE IMF and the Bankrupting of Argentina xviii (2005).
271. Sturzenegger & Zettelmeyer, supra note 193, at 179.
272. Id. at 182.
273. See also Decree 471 of March 8, 2002 for details of the pesification. Decree No. 471, Mar. 8, 2002, 29857 B.O. 1.
274. Blustein, supra note 198, at 102.
275. THE IMF AND ARGENTINA, supra note 194, at 79.
276. Id. at 58.
277. See Peterson, 2004, supra note 111.
278. For the role of international institutions in promoting FDI flows, see IBRAHIM F.I. SHIHATA, LEGAL TREATMENT OF FOREIGN INVESTMENT 12 (1993);
279. Ibrahim F.I. Shihata, Promotion of Foreign Direct Investment: A General Account with Particular Reference to the Role of the World Bank Group 6 ICSID Rev.-FILJ 484 (1991). For the role of the international economic institutions in urging Washington Consensus principles, including privatization in Latin America,
280. see DAVISON L. BUDHOO, ENOUGH IS ENOUGH: DEAR MR. CAMDESSUS. . .OPEN LETTER OF RESIGNATION TO THE MANAGING DIRECTOR OF THE INTERNATIONAL MONETARY FUND 102 (1990);
281. see a/so JOHN WILLIAMSON, THE POLITICAL ECONOMY OF POLICY REFORM 17 (1994).
282. Mineral and Petroleum Resources Development Act 28 of 2002. In force as of May 2004.
283. PETERSON, 2004, supra note 111, at 34-35.
284. See Foresti v. Republic of South Africa, 1CSID Case No. ARB(AF)/07/l (Jan. 8, 2007) (pending), available at http://icsid. worldbank.org/ICSID/FrontServlet?requestType=CasesRH&reqFrom= ListCases&caseld=C90&actionVal=ViewCase.
285. See Luke Eric Peterson, Analysis; South African Arbitration May Raise Delicate Human Rights Issues INVESTMENT TREATY NEWS [ITN], Feb. 14, 2007, at 5, http://www.iisd.org/pdf/2007/itn- febl4-2007. pdf.
286. General Agreement on Tariffs and Trade art. 20, Oct. 30, 1947, 61 Stat. A-ll, 55 U.N.T.S. 194. Recent developments may indicate a trend that will ultimately belie this claim. For example, some of Canada's newer Foreign Investment Protection Agreements include a general exceptions provision, as does Canada's model FIPA (2004).
287. See A. Newcombe, Canada's New Model FIPA, 30 CAN. COUNCIL ON INT'L L. BULL. (2004);
288. see also Agreement Between the Republic of Korea and Japan for the Liberalisation, Promotion and Protection of Investment, Mar. 22, 2002, Treaty No. 17, Ministry of Foreign Affairs Notification No. 430 (Japan). Sometimes "non-precluded measures" articles are found in BITs, including the U.S.-Argentina BIT, which provides, "{t]his Treaty shall not preclude the application by either Party of measures necessary for the maintenance of public order, the fulfillment of its obligations with respect to the maintenance or restoration of international peace or security, or the Protection of its own essential security interests," but the Argentine arbitrations show that this has been narrowly interpreted. Treaty Concerning the Reciprocal Encouragement and Protection of Investment, U.S.-Arg., Art. 11(a), Nov. 14, 1991, 31 I.L.M. 124 (1992) [hereinafter U.S.-Argentina BIT]. Moreover, it is present in only nine out of ten BITs.
289. See Burke-White & von Staden, supra note 196, at 311-14.
290. DOLZER & SCHREUER, supra note 156, at 119-
291. F.A. Mann, British Treaties for the Promotion and Protection of Investments, 52 BRIT. Y.B. INT'L L. 241, 243 (1981).
292. TUDOR, supra note 159, at 61-62.
293. DOLZER & SCHREUER, supra note 156, at 128.
294. Note that no similar "guiding" process exists for BIT obligations: the parties would have to agree to rewrite the terms of the treaty. NAFTA Notes of Interpretation, supra note 18.
295. Jose E. Alvarez, Professor, Columbia L. Sch., Comments at the NYU Institute for International Law & Justice Colloquium (Mar. 27, 2008).
296. U.S.-Argentina BIT, supra note 210.
297. PETER MUCHUNSKI, MULTINATIONAL ENTERPRISES AND THE LAW 625 (1995).
298. Christoph Schreuer, Fair and Equitable Treatment in Arbitral Practice, 6 J. WORLD INV. & TRADE 357 (2005);
299. OECD, Fair and Equitable Treatment Standard in International Investment Law 26 (Working Papers on International Investment No. 2004/3, 2004).
300. TUDOR, supra note 159, at 154-81;
301. DOLZER & SCHRBUER, supra note 156, at 133-47.
302. Tecnicas Medioambientales Teemed S.A. v. United Mexican States, ICSID Case No. ARB (AF)/ 00/2 (May 29, 2003) (Award), reprinted in 10 ICSID Rep. 130 (2006).
303. BISHOP, CRAWFORD & REISMAN, supra note 5, at 1016.
304. Teemed, supra note 221, ¶ 153.
305. GAMI Inv. Inc. v. Mexico, UNCITRAL (Nov. 12, 2004) (Final Award), reprinted in 44 I.L.M. 545 (2005); Occidental Exploration and Prod. Co. v. Republic of Ecuador, LCIA Case No. UN 3467 (July 1, 2004) (Final Award), reprinted in 12 ICSID Rep. 54 (2005).
306. Teemed, supra note 221, ¶ 154 (emphasis added).
307. TUDOR, supra note 159, at 176.
308. Teemed, supra note 221,¶156.
309. See, e.g., Occidental, supra note 224, \] 185-86.
310. MTD Equity Sdn. Bhd. v. Republic of Chile, ICSID Case No. ARB/01/7 (May 25, 2004) (Award), reprinted in 12 ICSID Rep. 6 (2007).
311. Id. ¶ 113 (emphasis added).
312. Id.¶ 160.
313. Id. ¶ 163.
314. Middle East Cement Shipping and Handling Co. S.A. v. Arab Republic of Egypr, ICSID Case No. ARB/99/6, (Apr. 12, 2002) (+Award), 89, reprinted in 7 ICSID Rep. 173 (2005).
315. Id. ¶ 43 (emphasis added).
316. Biwater Gauff (Tanzania) Ltd. v. United Republic of Tanzania, ICSID Case No. ARB/05/22 (July 24, 2008) (Award), available at http://ita.law.uvic. ca/documents/Biwateraward.pdf;
317. see also Luke E. Peterson, IN-DEPTH: Other treaty breaches, including of the Pair and Equitable Treatment standard, upheld in Biwater Gauff (Tanzania) Ltd. v. Republic of Tanzania, 1(6) IA REPORTER, July 28, 2008, http://www. iareporter.com/Archive/IAR-07-28-08.pdf [hereinafter Peterson, 2008].
318. Biwater Gauff, supra note 235,¶550.
319. Id. ¶ 497-500.
320. Id.¶ 627.
321. Id. ¶ 500.
322. Id ¶ 696 (emphasis added).
323. It may also conflict with freedom of expression. I am grateful to Michael Waibel for this observation. See Peterson, 2008, supra note 235;
324. see also Eureko B.V. v. Republic of Poland, (Aug. 19, 2005) (Partial Award and Dissenting Opinion), reprinted in 12 ICSID Rep. 335 (2007).
325. Biwater Gauff, supra note 235,¶434.
326. Id.¶515.
327. Peter T. Muchlinski, Caveat Investor? The Relevance of the Conduct of the Investor Under the Fair and Equitable Treatment Standard, 55 INT'L & COMP. L.Q. 527, 528-29 (2006).
328. Dolzer, supra note 110, at 970; see also G. Van Harten & M. Loughlin, Investment Treaty Arbitration as a Species of Global Administrative Law, 17 EUR. J. INT'L L. 121, 125, 148-50 (2006).
329. Two of the more controversial obligations are the prohibition against expropriation without compensation and the obligations observance clause (also known as the umbrella clause).
330. Elizabeth Whitsitt, NAFTA Fifteen Years Later: The Successes, Failures and Future Prospects of Chapter 11, ITN, Feb. 16, 2009, http://www.investmenttreatynews.org/cms/news/archive/2009/02/17/nafta- fifteen-years-later-the-successes-failures-and-future-prospects-of-chapter-11 .aspx.
331. Alvarez, ASIL Proceedings, supra note 64, at 553.
332. USD, Recent Developments, supra note 16; see supra Part I.
333. UNCTAD, World Investment Report 2003, supra note 31.
334. See supra note 28 and accompanying text.
335. David Kennedy, A New World Order: Yesterday, Today and Tomorrow, 4 TRANSNAT'L L. & CON- TEMP. PROBS. 329, 370-74 ( 1994).