An Umbrella just for Two? BIT Obligations Observance Clauses and the Parties to a Contract. (25th August 2014)

• Record Type: Journal Article
• Authors: Gallus, Nick
• Is Part Of: Arbitration international. Volume 24:Number 1(2008)
• Page Start: 157
• Page End: 170
• Publication Date: 2014-08-25
• Subjects: Arbitration and award, International -- Periodicals; 341.522
• DOI: 10.1093/arbitration/24.1.157
• Languages: English
• ISSNs: 0957-0411

Abstract

Abstract : Of all the controversial aspects of the bilateral investment treaty, perhaps none are as controversial as the scope of the treaty obligations observance, or 'umbrella, ' clause. By requiring states to observe obligations they have entered with regard to investments, the clause potentially enables foreign investors to pursue any contractual disputes with the host state before an independent arbitration tribunal. Foreign investors have also sought to rely on the clause to pursue their contractual disputes with sub-state entities as well as their local subsidiaries' contractual disputes. This article examines the result of these claims to determine if there is, indeed, room for more than just the foreign investor and host state under the obligations observance clause umbrella.