How is Fair and Equitable Treatment Defined Among International Tribunals
Davy Karkason, Esq. ACiarb.
Founding Member | Cross border disputes and international litigation
?When international investors and governments enter into agreements, disputes may arise that require the involvement of a tribunal. Tribunals are special bodies established to resolve disagreements between foreign investors and states in a fair and equitable manner. But what does "fair and equitable treatment" mean in this context? Let's take a look at how tribunals define this concept.?
The Meaning of Fair and Equitable Treatment?
The term “fair and equitable treatment” is used in many international agreements and treaties to protect foreign investors from arbitrary or discriminatory measures by the host state. The exact definition of “fair and equitable treatment” depends on the context, but typically it includes the right to be treated no less favorably than local investors or investments, as well as the obligation of the host state to act transparently with respect to foreign investments.?
When determining whether an investor has received fair and equitable treatment, tribunals consider several factors including whether the host state has violated any specific commitments made under an investment treaty; whether there has been discrimination against foreign investors; whether there has been a denial of justice; or whether there have been violations of human rights norms. It is important to note that tribunals do not consider each factor in isolation but instead look at all relevant factors together when making their decision.??This is where State responsibilities would follow when protecting investments.
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Tribunal Decisions?
Because fair and equitable treatment is such a broad concept, it can be difficult for tribunals to make decisions about what constitutes fair and equitable treatment in any given case. Consequently, tribunal decisions vary greatly depending on the facts of each case. For example, tribunals may find that a host state has breached its obligations if it fails to provide adequate compensation for an expropriation or if it fails to protect investors from physical harm or property damage due to civil unrest or wars. On the other hand, they may find that a host state has not breached its obligations if it enacts regulations designed to protect public health or safety or if it takes measures necessary for economic stabilization purposes.?
?Conclusion
In short, when assessing claims of unfair or inequitable treatment under international agreements, tribunals must weigh all relevant evidence before coming to a decision about what constitutes fair and equitable treatment in any given case. This often requires an analysis of both legal principles as well as the facts presented by each party involved in order for tribunals to accurately determine whether an investor was treated fairly under international law. Ultimately, when deciding these cases, tribunals strive to ensure that all parties receive a just resolution according to international standards.