Study On The Fair And Equitable Treatment In International Investment Law

In arbitration practice,the fair and equitable treatment became one of the most frequently cited claims by foreign investors,most of arbitration cases involve fair and equitable treatment.In the early days,the fair and equitable treatment included in the?A is not limited.Based on the generality,abstractness and ambiguity of the fair and equitable treatment,the expansionary interpretation of the arbitral tribunal was controversial.On the one hand,a state face the risk of being sued,lost as a defendant,and suffer huge compensation frequently.On the other hand,the regulatory power of public policy based on national sovereignty is challenged.The development of the fair and equitable treatment has become topics in focus.Universally recognized by all countries,not violating due process and prohibiting of denial of justice is one part of the connotation of fair and equitable treatment.Discrimination or arbitrary measures have also been accepted by some countries.In addition,the arbitral tribunal has also identified some other factors such as transparency,legitimate expectations of foreign investors,good faith,the stability of legal framework and regards them as the connotation of treatment.These elements are questioned and opposed by many countries.In order to reverse such a serious situation for the state,they focus on the reformation of the fair and equitable treatment in international investment agreements and limit treatment to the category of minimum standards of customary international law.If the arbitral tribunal wants to apply the specific elements,the first step is to prove that the elements meet the two elements of custom,which is very difficult.States are hoping to curb the excessive discretion of the arbitral tribunal.The results are not satisfactory.The practice of arbitration did not follow the states proposed ideal status.Most arbitral tribunals recognize that treatment is limited by customary international law,however,the arbitral tribunal,as always,binds to specific case facts,invokes other arbitral awards,interprets the meaning of the fair and equitable treatment,identifies the specific recognized elements,and judges whether the fair and equitable treatment is breached.Listing the detailed elements in the treaty is another path for the fair and equitable treatment reformation.The open list,adopted by some countries,does not limit the treatment,the practice of arbitration proves the unsatisfactory effect.In contrast,the closed list model,adopted by the European Union,is feasible and can handle the difficulties faced in the concept and practice.In the case that the specific elements included in the list,only prohibiting serious the violation of due process and denial of justice limit connotation of treatment.Other elements should be considered to be involved and limited reasonably,especially the specific elements proposed in the practice of arbitration.According to national conditions and the actual situation and demand of economic development,through the additional protocols,amendments,joint interpretations and other forms,countries should adjust the elements in the list and match the list to the policy options.On the contrary,it would not be the best choice to remove fair and equitable treatment from the treaty.Although China did not lost in arbitration practice on claims of fair and equitable treatment,treaty provisions signed in the early stage were inconsistent,and most of them did not set limit for the fair and equitable treatment.The potential risk of expanded interpretation of arbitral tribunals still exists.However,many treaties signed recently have limited fair and equitable treatment to customary international law in an open list mode.In 2017,with the acceleration of the FTA strategy and the advancement of FTA negotiations,China should conform to the development trend of fair and just treatment,meanwhile,take into account the national conditions and the actual needs and make reasonable provisions which are in line with policy options.Precaution is necessary and important.