International Investment Agreements Protection

54 Current results are available under investmentpolicyhub.unctad.org/IIA/mappedContent. 133 However, full compensation would lead to over-investment (due to the moral hazard resulting from insurance against regulation) and an optimal compensation mechanism would only provide compensation for certain contingencies (ideally only if regulation is ineffective at the global level). If this condition is not verifiable, there are different second options in their model. See also Aisbett – Bonnitcha, supra note 2 (distinction between regulatory changes due to temporal inconsistencies, those caused by new information). ILOs and MITs generally contain similar investor protection measures. The most common safeguards found in these instruments are: statistics show the rapid expansion of the IIA over the past two decades. By the end of 2007, the total number of I2 had already exceeded 5,500[12] and increasingly included the closing of the ITAPs, which focused on investment. As the types and content of I2 are increasingly diverse and almost all countries participate in the completion of the new I2, the global IS system is extremely complex and difficult to insert. This problem has been compounded by the shift of many States from a bilateral model of investment agreements to a regional model, without completely replacing the existing framework, which has led to an increasingly complex and denser network of investment agreements, which will certainly be increasingly opposed and overlapping. The main mechanism for resolving investment disputes is through the International Centre for the Settlement of Investment Disputes (ICSID). ICSID was established in 1965 as part of the ICSID Convention (also the Washington Convention). It has been ratified by more than 150 states.

The first case before ICSID was in 1972. Since 2000, the number of cases has increased significantly. It is also customary for investment contracts to provide that an investor can count on the free transfer of investments and funds in and out of the jurisdiction in which he has invested. However, another court held that a safeguard clause in another investment contract would not make sense if it did not result in a breach of the contract.3 61 See Brazil Direct Investment Abroad, CEIC, www.ceicdata.com/en/indicator/brazil/direct-investment-abroad. 55 UNCTAD reports 942 known cases by the end of 2018. See UNCTAD, Investment Policy Hub, on investmentpolicy.unctad.org/news/hub/1611/20190528-fact-sheet-surge-in-isds-cases-continues-in-2018. There is no comparable database of state claims, but the academic letter suggests that these claims are relatively few. See Roberts, Anthea, State-to-State Investment Treaty Arbitration: A Hybrid Interdependen Theory oft Rights and Shared Interpretive Authority, 55 Harv. Int`l L.J. 1 (2014); Nathalie Bernasconi-Osterwalder, settlement of state disputes in investment contracts (International Institute for Sustainable Development, Oct 2014). An International Investment Agreement (IIIA) is a kind of country-to-country treaty that addresses issues relevant to cross-border investment, usually to protect, promote and liberalize such investments.

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