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4 A History of International Investment Treaties

From: The Law of Investment Treaties (3rd Edition)

Jeswald W. Salacuse

From: Oxford Public International Law (http://opil.ouplaw.com). (c) Oxford University Press, 2021. All Rights Reserved.date: 23 June 2021

Subject(s):
Investment — ECT (Energy Charter Treaty) — NAFTA (North American Free Trade Agreement) — BITs (Bilateral Investment Treaties) — Travaux préparatoires

This chapter traces the history and considers the purposes and consequences of the movement by states to negotiate investment treaties. In the post-colonial era of nationalizations and contract renegotiations, the economic facts of life in host countries struggled against the form of various legal commitments made to foreign investors. To change the dynamics of this struggle so as to protect the interests of their companies and investors, capital-exporting countries began a process of negotiating international investment treaties that, to the extent possible, would be: (1) complete; (2) clear and specific; (3) uncontestable; and (4) enforceable. These treaty efforts took place at both the bilateral and multilateral levels, which, though separate, tended to inform and reinforce each other. As a result of this process, a widespread treatification of international investment law took place in a relatively short time. By the end of the second decade of the twenty-first century, foreign investors in many parts of the world were protected primarily by international treaties rather than as previously by customary international law alone. For all practical purposes, treaties have become the fundamental source of international law in the area of foreign investment.

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