Introduction
One of the most important pillars of investment
protection under international law is the understanding that a foreign investor
investing in a host state should be treated ‘fairly and equitably.’ The
importance of this notion is supported by the inclusion of the fair and
equitable treatment (FET) standard in most of the International Investment
Agreements (IIAs), as well as its invocation in the vast majority of investment
disputes. However, the concern has been expressed frequently that a broad
interpretation of this usually openly formulated provision has an adverse
impact on the host state’s ‘right to regulate’ in the public interest. These
concerns have been voiced particularly as a result of FET claims in which
investors have challenged a variety of state decisions in publicly sensitive
areas, e.g. renewable energy, waste management, public health issues, and
access to water. In this regard, tribunals have often been criticised for
attaching insufficient weight in their assessment of the FET standard to a host
state’s right to regulate and its duty to fulfil its obligations under other
international treaties, such as human rights and environmental treaties.More...
Editor’s
note: Shamistha Selvaratnam is a LLM Candidate of
the Advanced Masters of European and International Human Rights Law at Leiden
University in the Netherlands. Prior to commencing the LLM, she worked as a
business and human rights solicitor in Australia where she specialised in
promoting business respect for human rights through engagement with policy, law
and practice.
Introduction
This report compiles all relevant news,
events and materials on Doing Business Right based on the coverage provided on
our twitter feed @DoinBizRight and on various websites. You are invited to
contribute to this compilation via the comments section below, feel free to add
links to important cases, documents and articles we may have overlooked.
The
Headlines
Chevron
Corporation and Texaco Petroleum Company v The Republic of Ecuador
On 30 August 2018 an international tribunal
administered by the Permanent Court of Arbitration in The Hague issued an award
in favour of Chevron Corporation and Texaco Petroleum Company, holding that the
Republic of Ecuador had violated its obligations under international treaties,
investment agreements and international law. The tribunal found that a $9.5
billion judgment handed down by Ecuador’s Supreme Court in the Lago Agrio case was
procured through fraud, bribery and corruption. It also found that the Republic
of Ecuador had already released the claims that formed the basis of the
judgment years before. The tribunal concluded that the fraudulent Ecuadorian
judgment is “not final, enforceable, or conclusive under Ecuadorian and
international law” and therefore cannot be enforced within or outside of
Ecuador and that it “violates international public policy and natural justice”.
Draft
Optional Protocol to Business and Human Rights Treaty
On 4 September 2018 the Permanent Mission
of Ecuador to the UN and other International Organizations in Geneva presented
the ‘Draft
Optional Protocol To The Legally Binding Instrument To Regulate, In International
Human Rights Law, The Activities Of Transnational Corporations And Other
Business Enterprises’ (Optional Protocol). The Optional Protocol focuses on
ensuring State Parties to the Optional Protocol establish mechanisms that
provide access to remedy for victims of human rights violations in the context
of business activities of a transnational character. It also provides
individuals and group with the ability to make communications to the Committee
of experts. More...