Research On The NPM Provisions In Sino-foreign Bilateral Investment Treaties

In the bilateral investment treaty relationship, the parties reserving the right to takemeasures to safeguard national security interests, has become a exception of bilateralinvestment treaty commitments. NPM is this exclusion clause, ensuring the nationtaking special action on grounds of the fundamental interests of freedom,and theconsequences caused by the loss borne by the foreign investors, so, make a risks andbenefits redistribution and balance between foreign investors and host countries. As alarge country both at home and abroad pays equal attention to attract foreign capital andoverseas investment, the number of signed bilateral investment treaties came second inthe world, but in so many bilateral investment agreements, NPM terms were low overall,only little more than ten percent, and the attention and utilization degree on the NPMterms are far from enough. At the same time, we should also clear NPM terms are fromzero to so many in practices of the sino-foreign bilateral investment agreements, and itie really a quite sucess, suggesting the enhancement of the state sovereigntyconsciousness and safety consciousness, so reduce the blindness of investment and theutilization of foreign capital. However, throughout the existing designs of thesino-foreign bilateral investment agreements terms, provision patterns were vary, andthe main problems were lacking of definiteness、skill and operability. In the investmentagreement signed between China and other countries, lack a scientific and perfect NPMprovisions is no better than without, in this regard, the arbitration case betweenArgentina and the United States around Article11had provided a lesson for us.From thepractices of international arbitration, quoting terms of NPM successful or not, wasrelated to the size of the liability to pay compensation, therefore, cannot have anyambiguity.In this paper, making existing provisions of the sino-foreign bilateral investmenttreaties as the breakthrough point, we can see the integrated use of literature study、empirical analysis and comparative analysis methods.Combined with typical arbitrationcases on international investment law, discuss the existing NPM’s interpretationapplication standards. Find the NPM terms’s different from international customary lawin four aspects, thereby avoid the confusion in actual application. In view of thedifference, put forward some tentative suggestions on the arbitration examination andrecognition, adopting stringent or relatively loose standards. At the same time, make areasonable guidance on our country’s actively using NPM clause defense in thearbitration practice. Finally, Based on the instructions on NPM’s provision andapplication practices, from a long-term view, the author creatively put forward some assumptions on future sino-foreign bilateral investment treaties. It adapts to theequirements of the ongoing or upcoming bilateral investment treaties negotiations,andhas profound practical significance and influence. In addition to the preface andconclusion, there are six parts in this article. Overall, the article’s main innovation pointsare the following points：In the first part, the author make a classification on the way of sino-foreignbilateral investment treaties’ existing NPM terms. From the different presentationway,we can Intuitively and vividly see the importance, feasibility and effectiveness ofNPM terms,at the same time, it can also reflect the pros and cons of choosing made byour country and other countries on NPM terms. First of all, the distribution of the NPMclause in the agreement is different, so, the degree of importance is different. Putting theNPM terms in the preface as a statement or in the protocol as a supplement, before orafter feels are different. Second, for the NPM terms of sino-foreign bilateral investmenttreaties, there are different content, abstract、general or specific、refinement, weakoperability or strong operability. Finally, using a unified manner can make the NPMterms have fully force. In the opposite, the effect will be weakened.In the second part, the author keep a dialectical view on the NPM clauses of thesino-foreign bilateral investment treaties. On the one hand, the critical author points outcritically the problem that there are no relevant provisions or optional provisions interms of NPM.. On the other hand, the author keeps a objective evaluation of ourcountry’ trying to actively use NPM terms as a balance on bilateral investmentrelationship, which leads to great value and profound significance.In the third part, in the principle of the interpretation of the NPM clause, the authorputs forward to consider joint intent and negotiated consensus firstly, and thisexplanation has the priority in effectiveness. The arbitration tribunal must fully respectthe highest common interests of both sides. The following explanation and illustrationon the NPM clause elements, particularly with regard to the goal of public health, theauthor puts forward our country can make a more strict standard in the field of healthaccording to our specific conditions and actual needs. In this respect, the agreement hasprovided legal support and affirmation, so we must fully guide NPM terms to a higherstandard of health protection. In addition, in terms of "correlation", the author putsforward "minimal Breaking" as a standard to judge national measures whethercommensurate or not.In the fourth part, using comparative study methods, the author points out thedifference between NPM terms and international rules, in the substance、reason、scopeand sources of effectiveness. Only to find out the difference between them, can weavoid confusion. This is also the matting of the fifth part. In the fifth part, the author thinks that the arbitration tribunal should use a looserstandard or a more stringent standard when decides whether states government’sbehavior conforms to the NPM terms or not. While moderate examination standardcorresponding to NPM terms which have the nature of independent judgment, strictexamination standard corresponding to NPM terms whose evaluation right are grantedto the arbitration tribunal in a express or implied way. In addition, the author also putforward the explanation and application made by the arbitration court on NPM termsmust be coherent and consistent. When NPM terms are quoted as a defense way bycountries in the arbitration court, we should take flexible strategies according to thedegree of difficulty.In the last part, by integrating the current situation of the existing provisions、evaluation、interpretation、comparison and application aspects, the author put forwardcreatively several ideas on the way of sino-foreign bilateral investment treaties’ NPMterm design. The author puts forward original ideas on the definition of NPM terms’nature、scope of validity、review and the consequences of application. Especially on thequestion of quoting NPM terms whether means exempting from compensation or not,there is no unified conclusion. The author suggests we should take mandatorycompensation practices. From illegal compensation to fair compensation, the differencelies not only in a single word but in legal basis.