Research On Legal Regulation Of "Treaty Shopping" In International Investment

In the practice of settling disputes between investors and the host country,in order to seek more favorable entity or procedural rules,investors often take some means to circumvent the rules signed with the host country that should be applied,such as acquiring new investor nationality through corporate restructuring or extending the application scope of most-favored-nation treatment clauses to make them applicable to procedural rules.Scholars have named this phenomenon "treaty picking" or "treaty shopping",and disputed its legality.Not all "treaty shopping" practices are illegal.For example,the selection of more favorable substantive rights for investors based on the rationale of the MFN clause is permitted under international law.As for the behavior of investors changing their nationality to select the treaty,there are also contradictory arbitration awards in practice due to the unclear definition of the concepts of "investor" and "investment behavior".First of all,investors can obtain more favorable dispute settlement conditions through "treaty shopping",but this often causes unexpected losses to the host country,which is a breach of the original intention of signing the investment agreement.Therefore,it will affect the conclusion of the investment treaty of the host country in the future,thus having a negative effect on the transnational investment of the international community.However,the existing domestic investment laws and international investment agreements still have some deficiencies in the legal regulation of this issue.Therefore,it is of practical significance to take the host country as the main body to study this problem.Secondly,by analyzing the background,causes,types and purposes of the phenomenon of "treaty shopping",it can be concluded that its essence is similar to legal circumvention.Moreover,the causes have both internal and external causes,which are relatively complex and the means adopted are also diversified.Starting from the causes and operating means of this problem,three entry points of legal regulation can be put forward,namely,investor eligibility,application of MFN clause and diversification of dispute settlement mechanism.By analyzing one by one,we can put forward possible solutions or perfect methods.Finally,by analyzing China’s legal and regulatory attitude towards "treaty shopping",it can be seen that China is attaching more importance to this issue and,due to its own positioning transformation,pays more attention to the balance between the status of investors and the host country.Based on China’s new international investment needs and the innovative provisions of the new generation investment agreement of the European Union(CETA and JEEPA),this paper seeks solutions around the above three legal regulation entry points,and puts forward the specific content of reform.In future legislation,the definition of "investment" should be clarified and the scope of "investor" regulated;Adopt a partially negative attitude towards the extension of MFN treatment,fully consider the application of Oriental culture in the establishment of the dispute settlement mechanism with One Belt And One Road characteristics,and make effective use of the mediation system.