Critically analyse the concept of ' fair and equitable treatment ' in Essay

Critically analyse the concept of ' fair and equitable treatment ' in investment treaties, taking into account recent investment - Essay Example In the context of international investment, inter-state negotiation, inter-governmental treaty drafting, diplomatic exchange, etc. have become frequent and critical. Naturally, the number of disputes between investors and host countries is increasing as well. Hence, the issue of fair and equitable treatment in international investment dealing is gaining momentum very rapidly. There is a need to urge the different countries of the world to avoid activities like confiscation, expropriation, discrimination, etc. in regards of the foreign investors and the objective can be achieved if and only if the basic principles of mutual respect are legally defined and incorporated in the treaty frameworks. This paper is developed through a literature review followed by an analysis phase which will critically evaluate the importance of fair and equitable treatment in relation to the recent trends of investment treaties and the different related arbitration cases. Arbitration case examples have been appended after the analysis, followed by a viable conclusion. The paper also aims to comprehend the present trends in the light of the older developments which have shaped up today’s international investment scenario. ... ovide and ensure â€Å"fair and equitable treatment† is generally put forward, along with certain other standards, as component of protection for Foreign Direct Investment (FDI) by the host countries. It is a non-contingent and absolute treatment standard which states that the treatment would be executed in such terms whose exact meanings are well defined, by the means of references to certain situations of application. The â€Å"relative† standards specified in â€Å"national treatment† are not of primary importance in this regard. The standards to determine fair and equitable treatment were developed through multilateral investment and trade instruments, and with the increasing numbers of Bilateral Investment Treaties (BITs), these standards became more critical and debated. â€Å"The obligation of the parties to investment agreements to provide to each other’s investments fair and equitable treatment has been given various interpretations by government al officials, arbitrators and scholars.†1 Thus the backdrop of analysis of the concept of â€Å"fair and equitable treatment† must be based on the literature that describes the trends of international investment law. â€Å"International investment law is one of the fastest-growing areas of international law today. Only a decade ago, the current surge in investor–state arbitrations, having cumulated in approximately 300 investment treaty disputes,  1  was beyond imagination. At the same time, investment treaties enshrine principles of international investment law, rather than hard and fast rules. Almost unavoidably, international investment law therefore became coined more by the dispute settlement activities of arbitral tribunals which entertain claims between foreign investors and host states brought under investment