CYIL vol. 10 (2019)

MIRIAMA KISELYOVA CYIL 10 ȍ2019Ȏ US Model BIT 2012 (customary international law minimum standard of treatment), which is a “classic” opposite approach on how to address the FET standard. This closed list of FET was described as “ bold attempt to provide a codification of the concept of fair and equitable treatment 22 ”. Full protection and security is also governed, which covers only physical security of covered investors and investments. Additionally, the article contains the umbrella clause , although only a limited one, covering clear commitments in writing. The agreement protects from both direct and indirect expropriation , unless it is for public purposes, in accordance with due process, on a non-discriminatory basis and against payment of prompt, adequate, and effective compensation (so-called Hull formula) according to a fair market value of the expropriated investment. The compulsory licences to intellectual property rights compliant with TRIPS are excluded. The special regime applies to land expropriation by Singapore. Indirect expropriation is in detail described in the annex part below. Transfers 23 article guarantees (a list of ) transfers in relation to covered investment. Nevertheless, this does not prevent application, in an equitable and non-discriminatory manner, of Parties laws relating to bankruptcy, securities, criminal offences, judgment enforcements, etc. 24 The agreement also contains articles on subrogation 25 and compensation for losses . 26 Dispute settlement Chapter three governs dispute settlement. Section A covers Resolution of Disputes between Investors and Parties . Section B governs Resolution of Disputes Between Parties ( State to State Dispute Settlement ). This article is focused only on Resolution of Disputes between Investors and Parties. Consultation 27 the article stipulates statute of limitations for the dispute to be brought to the arbitration. Notice of intent 28 the article stipulates the determination of the respondent by the EU in case the notice is sent to the Union. Conditions of the submission of claim 29 is an article of special importance. It describes detail very strict procedural conditions for submission of a claim, failure to which shall lead decline of the jurisdiction by the tribunal, upon request of the respondent. This article prevents parallel or multiple proceedings. No U turn principle applies – earlier proceedings shall be suspended before access to arbitration. 30 The tribunal shall also decline jurisdiction 22 McLACHLAN, Campbell, SHORE, Laurence, WEINIGER, Matthew. International Investment Arbitration. Substantive principles . Second Edition, Oxford International Arbitration Series, p. 280. The authors referred to CETA text of FET, however, the content of FET in both treaties is based on the same “closed list approach” and overlaps to a great extent. For the sake of objectivity, it is important to note that the authors expressed a certain degree of scepticism towards such codification, since the list of FET itself is not hermetically closed and e.g. the term manifest will be subject to tribunal assessment. 23 Article 2.7 24 In this relation, it is noteworthy to refer to infringements against Denmark, Sweden, Austria, and Finland for not having the transfer provisions compliant with EU law: http://europa.eu/rapid/press-release_IP-04-618_ en.htm?locale=en.

25 Article 2.8. 26 Article 2.5. 27 Article 3.3. 28 Article 3.5 29 Article 3.7

30 Parallel proceedings in national courts or commercial arbitration between the same parties as the investment arbitration are „ a by-product of the fragmented nature of modern investment protection by treaty, made up, as it is, of a huge network of a bilateral arrangements. ” In McLACHLAN, Campbell, SHORE, Laurence, WEINIGER, Matthew. International Investment Arbitration. Substantive principles. Second Edition, Oxford International Arbitration Series, p. 140.

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