In this essay, I am going to analyse the above mentioned BIT in terms of the meaning of investors and investments. Furthermore, I am looking at the effectiveness of Fair and Equitable Treatment along with Most-Favoured-Nation clause, whether they can operate separately or in some instances shall be treated as related.
Papua New Guinea is a party to the 36 bilateral treaties. Japan has 24 Bilateral Investment Treaties in force. The BIT between Japan-Papua New Guinea was signed on 26/04/2011, and came into force on 17/01/2014. The duration of the Treaty is 10 years. International investment treaties in general do not contain express rules, but as their function is to settle any disputes arising due to opposing rights and interest by applying a specific provision of law. Although, it is not clear whether international investment law has become lex general but the judgement delivered by the International Court of Justice in the Diallo Case suggests, that “….
. in contemporary international law, the protection of the rights of companies and the rights of their shareholders, and the settlements of the associated disputes, are essentially governed by bilateral or multilateral agreements ….In that context, the role of diplomatic protection somewhat faded ….” Diallo was the first case since Barcelona Traction in 1970 which has reached the International Court. Also, in CMS v Argentina, the Tribunal suggested that the fact is that lex specialis is so prevailing that it could be deemed as the general rule.
The purpose of investment treaties are to benefit the host country and the investor, to promote foreign investments and to remove obstacles to allow more foreign investments into the host state. “Under customary international law, states are not under the obligation to admit foreign investments in its territory or in any particular segment of its economy.” Once the foreign investment is allowed the host country become a subject to a minimum standard owed to the foreign investor.