1 Investment treaties provide various dispute resolution mechanisms, “one of the most important of which is international investor-state arbitration which entitles an injured investor to sue the host government for damages because of a violation of treaty standards and rights.” Salacuse, Jeswald W., The Emerging Global Regime for Investment, 51 HARV. INT’L L.J., 427, 446 (2010)Google Scholar. A supervising body may assist in appointing arbitrators, determining the place of arbitration, determining costs and arbitrator fees, and so forth, and will itself charge a fee for the performance of these functions. The most common supervisory bodies referred to in investment-enabling institutions are the International Centre for the Settlement of Investment Disputes (ICSID) and the International Chamber of Commerce's (ICC) International Court of Arbitration; each body has its own set of arbitration rules. See id. at 446-47 n.91. Ad-hoc arbitrations most often follow the arbitration rules of the United Nations Commission on International Trade Law (UNCITRAL). See id.

2 In the Canfor v. United States Order of the Consolidation Tribunal, the Tribunal noted the general trend in investor-State arbitration is transparency of process, a trend to which the tribunal itself subscribed. See Canfor Corporation v. United States, UNCITRAL, Order of the Consolidation Tribunal, ¶ 139 (Sept. 7, 2005); see also Biwater Gauff (Tanz.) Ltd. v. United Republic of Tanz., ICSID Case No. ARB/05/22, Procedural Order No. 2, at 5 (May 24, 2006).

3 Even if disputes do not result in regulatory rollback, there are other possible policy implications, which are harder to measure.

4 See Voon, Tania & Mitchell, Andrew, Time to Quit? Assessing International Investment Claims Against Plain Tobacco Packaging in Australia, 14 J. INT’L ECON. L. 515, 517-18 (2011)Google Scholar (discussing attempts by tobacco companies to discredit Australia's TPP plain packaging scheme by looking to international investment law).

5 Much of the debate regarding the ISDS provisions of the KORUS FTA is viewed as an outgrowth of political posturing prior to the parliamentary and presidential elections next year rather than legal or economic arguments. But the developments in Korea have potentially lasting effects throughout our (Asia-Pacific) region and beyond (especially in the context of Japan joining TPP negotiations).

6 Australia is trying to persuade other TPP members to do away with ISDS in the investment chapter. See DEP't OF FOREIGN AFFAIRS & TRADE, GILLARD GOVERNMENT TRADE POLICY STATEMENT: TRADING OUR WAY TO MORE JOBS AND PROSPERITY 14 (2011), available at http://www.dfat.gov.au/publications/trade/trading-our-way-to-more-jobs-and-prosperity.html. The reason for doing so according to Australia is that ISDS is not required to secure foreign direct investment (FDI) into TPP countries and they confirm this through an independent study. Trakman, Leon E., Investor State Arbitration or Local Courts: Will Australia Set a New Trend?, 46 J. WORLD TRADE 83 (2012)Google Scholar. This is an interesting issue for the developing members of the TPP to seriously consider and they may have to conduct a study to confirm or rebut Australia's findings.

7 Similarly, the Australia-US FTA does not contain an investor-state dispute settlement clause (ISDS), although other Australian PTAs—e.g. the Singapore-Australia FTA—contain such a clause.

8 See Chang-fa Lo, External Regime Coherence: WTO/BIT and Public Health Tension as an Illustration, 7 ASIAN J. WTO INT’L HEALTH L. & POL’Y 263, 276 (2012).

9 For instance, recent agreements negotiated by the United States and Canada suggest a recognition of potential investment-environment conflicts, although it remains debatable as to whether the additions and clarifications in these agreements go far enough. In terms of arbitration institutions, there is certainly a growing consensus that that they require a higher degree of transparency and accountability than has been traditionally accepted.

10 General Agreement on Tariffs and Trade, art. XX, Oct. 30, 1947, 61 Stat. A-11, 55 U.N.T.S. 194 [hereinafter GATT].

11 However, it is worth mentioning that general exceptions incorporated in investment treaties may not be interpreted in the same manner than within WTO, which raises the issue of diverging interpretation for similar provisions.

12 See generally Dattu, Riyaz, A Journey from Havana to Paris: The Fifty-Year Quest for the Elusive Multilateral Agreement on Investment, 24 FORDHAM INT’L L.J. 275 (2000)Google Scholar (discussing investment liberalization); Mansfield, Edward D. et al., World Trade Report 2011. The WTO and Preferential Trade Agreements: From Co-Existence to Coherence, 11 World Trade Rev. 327 (2012)Google Scholar (discussing trade liberalization).

13 See Olmedo, Javier Garcia, The Use of Tobacco Trademarks Versus Public Health: A New Trend in Investor-State Arbitration, 15 INT’L ARB. L. REV. 42 (2012)Google Scholar.

14 See generally Franck, Susan D., The Legitimacy Crisis in Investment Treaty Arbitration: Privatizing Public International Law Through Inconsistent Decisions, 73 FORDHAM L. REV. 1521, 1584 (2005)Google Scholar.

15 See Roberts, Anthea, Power and Persuasion in Investment Treaty Interpretation: The Dual Role of States, 104 AM. J. INT'L L. 179, 179 (2010)Google Scholar (“As investment treaties create broad standards rather than specific rules, they must be interpreted before they can be applied. Investor-state tribunals have accordingly played a critical role in interpreting, hence developing, investment treaty law.”).

16 Of course, the WTO has not directly tackled the broad issue of foreign investment rules. Instead, GATT and the WTO have dealt with a narrow set of very specific issues, which has left nations to formulate their own policies through BITs. The WTO, however, handles two agreements that address investment directly: the Agreement on Trade-Related Investment Measures (TRIMs) and the most important the General Agreement on Trade in Services (GATS). On the attempts at crafting multilateral disciplines on investment, see Chakraboty, Debashis, Chaisse, Julien & Mukherjee, Jaydeep, Deconstructing Services and Investment Negotiations: A Case Study of India at WTO GATS and Investment Fora, 14 J. WORLD INVESTMENT & TRADE 44 (2013)Google Scholar. See also Collins, David, A New Role for the WTO in International Investment Law: Public Interest in the Post-Neoliberal Period, 25 CONN. J. INT’L L. 1 (2009)Google Scholar.

17 See Salacuse, Jeswald W., The Treatification of International Investment Law, 13 LAW & BUS. REV. AM. 155 (2007)Google Scholar.

18 JAMES ZHAN ET AL., UNITED NATIONS CONFERENCE ON TRADE & DEV., WORLD INVESTMENT REPORT 2012, 199 annex tbl.III.1 (2012) (listing IIAs as of mid-June, 2012).

19 Salacuse, supra note 1, at 432.

20 International investment regulation is an example par excellence for fragmentation in an important area of international economic law. Despite this similarity in structure and areas of substantial convergence, there are also areas characterized by wide variation in the substantive provisions. See Chaisse, Julien et al., The Regulatory Framework of International Investment: The Challenge of Fragmentation in a Changing World Economy, in THE PROSPECTS OF INTERNATIONAL TRADE REGULATION – FROM FRAGMENTATION TO COHERENCE 417, 417-51 (Thomas Cottier & Panagiotis Delimatsis eds., 2011)Google Scholar.

21 The extent to which BITs actually attract increased flows of foreign direct investment is disputed. According to Salacuse & Sullivan, entering a BIT with the United States of America would nearly double a country's FDI inflows. Salacuse, Jeswald W. & Sullivan, Nicholas P., Do BITs Really Work?: An Evaluation of Bilateral Investment Treaties and Their Grand Bargain, 46 HARV. INT’L L.J. 67 (2005)Google Scholar. However, entering BITs with other OECD countries had no significant effect on FDI. See id. at 105-11. Another important study concludes that there is “little evidence that BITs have stimulated additional investment.” Hallward-Driemeier, Mary, Do Bilateral Investment Treaties Attract FDI? Only a Bit … and They Could Bite 22 (World Bank Dev. Research Grp., Research Working Paper No. 3121, 2003)CrossRefGoogle Scholar, available at http://elibrary.worldbank.org/content/workingpaper/10.1596/1813-9450-3121.

22 MODEL CANADA FOREIGN INVESTMENT PROMOTION AND PROTECTION AGREEMENT, ART. 7, available at http://italaw.com/documents/Canadian2004-FIPA-model-en.pdf.

23 GATT, supra note 10, at art. XX. This provision justifies deviations from all WTO rules, in particular, but not exclusively, from the constitutional principle of national treatment and from the key prohibition of quantitative restrictions. Id.

24 Do Bilateral Investment Treaties Increase Foreign Direct Investment Flows, BITSEL INDEX, http://www.cuhk.edu.hk/proj/BITsel (last visited Feb. 8, 2013). For a commentary on this Index, see Chaisse, Julien & Bellak, Christian, Do Bilateral Investment Treaties Promote Foreign Direct Investment? Preliminary Reflections on a New Methodology, 3 TRANSNAT’L CORPS. REV. 3 (2011)Google Scholar.

25 New Zealand-Malaysia Free Trade Agreement, Oct. 26, 2009 [2010] NZTS 09, available at http://www.parliament.nz/NR/rdonlyres/EF72A49B-246D-4775-88EB-1606723EC005/209843/DBHOH_PAP_22632_NewZealandTreatySeriesMalaysiaNewZ.pdf.

26 Id. art. 17.1.

27 Free Trade Agreement Between the Government of New Zealand and the Government of the People's Republic of China, Apr. 7, 2008 [2008] NZTS 19, available at http://www.parliament.nz/NR/rdonlyres/EAF7A717-6DD2-4A77-833A-7C1A86B42A33/202439/DBHOH_PAP_22061_NewZealandTreatySeriesFreeTradeAgr.pdf.

28 Id.

29 Id. art. 200.

30 The EFTA is a free trade organization between four European countries that operates in parallel with the European Union (EU). The EFTA was established on May 3, 1960 as a trade bloc-alternative for European states who were either unable or unwilling to join the then-European Economic Community (EEC) which has now become the EU. See The European Free Trade Association, EFTA, http://www.efta.int/about-efta/the-european-free-trade-association.aspx (last visited Apr. 11, 2013).

31 See Free Trade Agreement Between the EFTA States and Hong Kong, China, EFTA-H.K., art. 4.9, June 21, 2011, European Free Trade Ass’n, available at http://www.efta.int/free-trade/free-trade-agreements/hong-kong.aspx.

32 Id.

33 Overview of Peru (PESFTA), IE SINGAPORE, http://www.fta.gov.sg/fta_pesfta.asp?hl=3 (last visited Feb. 27, 2013).

34 Peru-Singapore Free Trade Agreement, Peru-Sing., art. 18.1(2), May 29, 2008, Org. of Am. States, http://www.sice.oas.org/TPD/PER_SGP/Final_Texts_PER_SGP_e/index_e.asp#top.

35 United States-Singapore Free Trade Agreement, U.S.-Sing., ch. 15, art. 21.1, May 6, 2003, Office of the U.S. Trade Representative, http://www.ustr.gov/trade-agreements/free-trade-agreements/singapore-fta/final-text.

36 Bilateral Investment Treaty Between the Government of Hashemite Kingdom of Jordan and the Government of the Republic of Singapore, Jordan-Sing., May 16, 2004, http://www.worldtradelaw.net/fta/agreements/JorSing_BilInvTreaty.pdf [hereinafter BIT Jordan-Sing.].

37 Specifically,

Overview of Hashemite Kingdom of Jordan (SJFTA), SING. FTA NETWORK, http://www.fta.gov.sg/fta_sjfta.asp?hl=5 (last visited Apr. 12, 2013).

38 BIT Jordan-Sing., supra note 36, at art. 18.

39 Agreement Between Canada and the Republic of Peru for the Promotion and Protection of Investments, Can.-Peru, art. 10, Nov. 14, 2006, available at http://unctad.org/sections/dite/iia/docs/bits/canada_peru.pdf.

40 Agreement Between Japan and the Republic of Singapore for a New-Age Economic Partnership, Japan-Sing., art. 83, Jan. 13, 2002, Ministry of Foreign Affairs of Japan, http://www.mofa.go.jp/region/asia-paci/singapore/jsepa.html.

41 ORG. FOR ECON. CO-OPERATION & DEV. [OECD], INTERNATIONAL INVESTMENT LAW: UNDERSTANDING CONCEPTS AND TRACKING INNOVATIONS: A COMPANION VOLUME TO INTERNATIONAL INVESTMENT PERSPECTIVES 182 (2008).

42 Draft MODEL NORWEGIAN BILATERAL INVESTMENT TREATY art. 11 (2007), available at http://www.asil.org/ilib080421.cfm.

43 The Dominican Republic-Central America-United States Free Trade Agreement, art. 17.12, Aug. 5, 2004, Office of the U.S. Trade Representative, http://www.ustr.gov/trade-agreements/free-trade-agreements/cafta-dr-dominican-republic-central-america-fta/final-text.

44 CHRISTIAN BELLAK & SUSANNE MAYER, INWARD FDI IN AUSTRIA AND ITS POLICY CONTEXT 5 nn.9-10 (2010), available at http://www.vcc.columbia.edu/files/vale/documents/Austria_IFDI_Final.pdf.

45 The Harvard Draft Convention on the International Responsibility of States for Injuries to Aliens has been cited by a number of IIA tribunals as an authoritative statement of certain aspects of the minimum standard of treatment.

46 Special Rapporteur on State Responsibility, First Rep. on State Responsibility – Review of Previous Work on Codification of the Topic of the International Responsibility of States, Int’l Law Comm’n, U.N. Doc.A/CN.4/217 and Corr.1 and Add.1 Annex VII at 143 (1969) (by Roberto Ago) [hereinafter Special Rapporteur, State Responsibility], available at http://untreaty.un.org/ilc/guide/9_6.htm (Article 3 of the Draft Convention on the International Responsibility of States for Injuries to Aliens).

47 Id. (Article 4 of the Draft Convention on the International Responsibility of States for Injuries to Aliens).

48 Id. (Article 4, subsection 2 of the Draft Convention on the International Responsibility of States for Injuries to Aliens).

49 Id.

50 GATT, supra note 10, at art. XX.

51 See Bartels, Lorand, The WTO Legality of the Application of the EU's Emission Trading System to Aviation, 23 EUR. J. INT’L. L. 429, 450-51 (2012)Google Scholar.

51 See Bartels, Lorand, The WTO Legality of the Application of the EU's Emission Trading System to Aviation, 23 EUR. J. INT’L. L. 429, 450-51 (2012)Google Scholar.

52 Chaisse, Julien, Non-Trade Norms in WTO Litigation, in NORMER LE MONDE: L’ENONCIATION DES NORMES INTERNATIONALES 213 (Schemeil, Yves & Eberwein, Wolf-Dieter eds., 2009)Google Scholar.

53 The WTO DSB is established by the Understanding on Rules and Procedures Governing the Settlement of Disputes (DSU, Annex 2). This agreement provides for the establishment of panels and the Appellate Body to deal with disputes between members which both form the DSB. See Jackson, John H., The WTO Dispute Settlement Understanding – Misunderstandings on the Nature of Legal Obligation, 91 AM. J. INT’L L. 60, 60–64 (1997)Google Scholar; see also Jackson, John H., International Law Status of WTO Dispute Settlement Reports: Obligation to Comply or Option to “Buy Out”?, AM. J. INT’L L. 109, 109–125 (2004)Google Scholar.

54 Lamy, Pascal, The Place of the WTO and Its Law in the International Legal Order, 17 EUR. J. INT’L L. 969, 970 (2006)Google Scholar. Indeed, the dispute settlement practice followed by WTO since 1995 shows that the purpose of judicial organs responsible for resolving disputes is a reminder of the legality rather than the protection of particular interests of the contracting governments. What the DSB does is to monitor legality at the international level. See Chaisse, Julien & Chakraborty, Debashis, Implementing WTO Rules Through Negotiations and Sanctions: The Role of Trade Policy Review Mechanism and Dispute Settlement System, 28 U. PA. J. INT’L L. 153, 168 (2007)Google Scholar.

55 However, the WTO is at a disadvantage because all its decisions have to be taken by consensus which paralyses the progress of negotiations.

Chaisse, Julien & Matsushita, Mitsuo, Maintaining the WTO's Supremacy in the International Trade Order: A Proposal to Refine and Revise the Role of the Trade Policy Review Mechanism, 16 J. INT’L ECON. L., 1, 1 (2013)Google Scholar.

56 Chaisse, supra note 52.

57 For a comprehensive presentation of the GATT general exceptions, see GUIGUO WANG, RADIATING IMPACT OF WTO ON ITS MEMBERS’ LEGAL SYSTEM: THE CHINESE PERSPECTIVE 140-51 (2011).

58 See GATT, supra note 10, at art. XI. It justifies deviations from rules, in particular, but not exclusively, from the principle of national treatment and from the prohibition of quantitative restrictions. Id. Similar deviations also exist under the GATS. See Bartels, supra note 51, at 460-61.

59 WANG, supra note 57, at 142.

60 See Correa, Carlos M., Implementing National Public Health Policies in the Framework of WTO Agreements, 34 J. WORLD TRADE 89 (2000)Google Scholar.

61 See GATT, supra note 10, at art. XX.

62 See id.

63 General Agreement on Trade in Service, Apr. 15, 1994, Marrakesh Agreement Establishing the World Trade Organization, Annex 1B, art. XIV, THE LEGAL TEXTS: THE RESULTS OF THE URUGUAY ROUND OT MULTILATERAL TRADE NEGOTIATIONS 284 (1999), 1869 U.N.T.S 183, 33 I.L.M. 1167 (1994) [hereinafter GATS].

64 Id.

65 Id.

66 See Luan, Xinjie & Chaisse, Julien, Preliminary Comments on the WTO Seals Products Dispute: Traditional Hunting, Public Morals and Technical Barriers to Trade, 22 COLO. J. INT'L ENVTL. L. & POL'Y 79 (2011)Google Scholar.

67 In order to fall within the ambit of subparagraph (b) of Article XX, a measure must “necessary for the protection of human, animal or plant life or health.” GATT, supra note 10, at XX(b). In EC—Asbestos, the Appellate Body was called upon to elaborate on the correct meaning and application of paragraph (b) of Article XX of the GATT 1994. See Appellate Body Report, European Communities—Measures Affecting Asbestos and Asbestos-Containing Products, WT/DS135/AB/R (Mar. 12, 2001). After having determined that the French measure “protects human … life or health” within the meaning of Article XX(b), it turned to examine whether the measure was “necessary” for the protection of public health. Id. ¶ 164. This dispute marks the first decision under the WTO regime in which an otherwise inconsistent measure was found by a panel or the Appellate Body to be justified under Article XX(b) of the GATT 1994. The Appellate Body seized the opportunity to clarify, and to slightly refine, the findings of the panel in relation to the necessity test in Article XX(b). For more information, see SIMON LESTER, BRYAN MERCURIO & ARWEL DAVIES, WORLD TRADE LAW: TEXT, MATERIALS AND COMMENTARY 363-415 (2d ed. 2012).

68 In order to fall within the ambit of subparagraph (g) of Article XX, a measure must relate “to the conservation of exhaustible natural resources.” GATT, supra note 10, at XX(g). “The term ‘relat[e] to’ is defined as ‘hav[ing] some connection with, be[ing] connected to.’” Appellate Body Report, China—Measures Related to the Exportation of Various Raw Materials, ¶ 355, WT/DS394/AB/R, WT/DS395/AB/R, WT/DS398/AB/R (Jan. 30, 2012) [hereinafter Appellate Body Report, China] (citing 2 SHORTER OXFORD ENGLISH DICTIONARY 2519 (W.R. Trumble & A. Stevenson eds., 6th ed. Oxford University Press 2007)).

69 “[T]he purpose and object of the introductory clauses of Article XX is generally the prevention of ‘abuse of the exceptions of … Article [XX].’” Appellate Body Report, United States—Standards for Reformulated and Conventional Gasoline, 22 WT/DS2/AB/R (Apr. 29, 1996).

70 See Appellate Body Report, United States—Import Prohibition of Certain Shrimp and Shrimp Products, ¶¶ 111-124, WT/DS58/AB/R (Oct. 12, 1998) [hereinafter Appellate Body Report, Shrimp].

71 Id. at ¶ 119.

72 Appellate Body Report, China, supra note 68, at ¶ 354.

73 This Article does not discuss the paragraph (a) which protects public morals and paragraph (d) which essentially deals with marketing regulations and intellectual property rights. First, these other paragraphs of Article XX of the GATT 1994 have gained less importance. Second, there are simply not relevant in the context of tobacco control.

74 For a comprehensive review of all the WTO cases dealing with tobacco products, see Chang-fa Lo, supra note 8, at 266-68.

75 Specifically,

Julie Ferguson, Cigarette Import Ban in Thailand, TED CASE STUDIES (Jan. 11, 1997), http://www1.american.edu/ted/cigar.htm.

76 Panel Report, Thailand–Restrictions on Importation of and Internal Taxes on Cigarettes, DS10/R-37S200 (Oct. 5, 1990).

77 Ferguson, supra note 75; see also Panel Report, supra note 76, ¶¶ 12, 22, 23, 51, 77.

78 See Panel Report, United States–Restrictions on Imports of Tuna DS21/R – 39S/155 (Sept. 3, 1991); see also Panel Report, United States–Restrictions on Imports of Tuna, DS29/R (June 16, 1994).

79 Id.

80 Appellate Body Report, supra note 69, at 17. For a detailed analysis of the Appellate Body's usage of the VCLT, see Mercurio, Bryan & Tyagi, Mitali, Treaty Interpretation in WTO Dispute Settlement: The Outstanding Question of the Legality of Local Working Requirements, 19 MINN. J. INT’L L. 275 (2010)Google Scholar.

81 Appellate Body Report, supra note 69, at 19.

82 Id. at 20.

83 See id. at 20-21.

84 See id.

85 Id.

86 Appellate Body Report, European Communities–Measures Affecting Asbestos-Containing Products, WT/DS135/AB/R (Mar. 12, 2001). The dispute concerned the French prohibition of the manufacture, processing, sale, import, placing on the domestic market and transfer under any title of asbestos fibers and products containing them. See id. ¶¶ 1-2.

87 Id. ¶¶ 164-175.

88 See id. at ¶ 192.

89 See id.

90 The Appellate Body indicated that:

Id. ¶ 174 (citation omitted)

91 Id. ¶ 168 (emphasis added).

92 See id. ¶¶ 169-175.

93 The 2007 Brazil-Tyres backs up Asbestos and uses a clear test when looking at necessity since the complaining party needs to identify possible alternatives. Panel Report, Brazil—Measures Affecting Imports of Retreaded Tyres, ¶ 7212 WT/DS332/R (June 12, 2007).

94 See supra note 67.

95 Appellate Body Report, United States—Import Prohibition of Certain Shrimp and Shrimp Products, ¶ 145 WT/DS58/AB/R (Oct. 12, 1998). The Appellate Body, however, subsequently established that the U.S. measure was not applied in line with the chapeau of Article XX. Id. ¶ 112.

96 Appellate Body Report, China, supra note 68, ¶ 355.

97 GATT, supra note 10, at art. XX.

98 As noted by Bartels,

Bartels, supra note 51, at 451.

99 See ZHAN ET AL., supra note 18, at 136.

100 See id.

101 GATT, supra note 10, at art. XX.

102 Id.

103 See Noble Ventures, Inc. v. Rom., ICSID Case No. ARB/01/11, Award, ¶ 55 (Oct. 12, 2005). Also, in Sempra v. Argentine Republic, the Tribunal held that a restrictive interpretation of an escape route from the defined obligations is mandatory. See Sempra Energy Int’l v. Argentine Republic, ICSID Case No. ARB/02/16, Award, ¶ 373 (Sept. 28, 2007). More specifically, the Lemire v. Ukraine Tribunal noted that the reservation at issue required prior notification and held that “notification of limiting laws and regulations is not simply a formality: it is a fundamental requirement in order to guarantee that investor's enjoy legal certainty, and States cannot invoke the exception ex post facto, surprising the investor's good faith.” Joseph C. Lemire v. Ukraine, ICSID Case No. ARB/06/18, Award, ¶ 49 (Mar. 28, 2011).

104 Investment standards definitions and scopes may vary from one treaty to another. However, in order to circumvent this methodological difficulty, I will base each test on a broad (but realistic) definition which gives the standard a wide scope of application. By the same token, it will help to assess the general exceptions clause impact as it is precisely in relation with a powerful investment standard that the exception should be capable to play a role. If the general exceptions clause can justify a deviation from a wide international standard, it would obviously do the same with a narrower standard.

105 Moreover, Mercurio makes the point that it is “dangerous” to import trade law directly into the investment law context. Mercurio, Bryan, Awakening the Sleeping Giant: Intellectual Property Rights in International Investment Agreements, 15 J. INT’L ECON. L. 871, 905 (2012)Google Scholar.

106 WHO Framework Convention on Tobacco Control [FCTC], opened for signature, June 16, 2003, 2302 U.N.T.S. 166. On the FCTC, see Olmedo, Javier Garcia, The Use of Tobacco Trademarks Versus Public Health: A New Trend in Investor-State Arbitration, 15 INT’L. ARB. L. REV. 42, 48–49 (2012)Google Scholar. See also McGrady, Benn, Philip Morris v. Uruguay: The Punta del Este Declaration on the Implementation of the WHO Framework Convention on the Implementation of the WHO Framework Convention on Tobacco Control, 2 EUR. J. RISK REG. 254 (2011)Google Scholar.

107 See WHO FCTC, supra note 106, at arts. 6-17.

108 See id. at arts. 6-13, 16.

109 Suez, Sociedad General de Aguas de Barcelona S.A. v. Argentine Republic, ICSID Case No. ARB/03/17, Decision on Jurisdiction, ¶ 55 (May 16, 2006).

110 See WHO FCTC, supra note 106, at art. 9.

111 Responsibility of States for Internationally Wrongful Acts, G.A. Res. 56/83, UN GAOR, 56th Sess., U.N. Doc A/RES/56/83, at 3 (Jan. 28, 2002), available at http://www.un.org/ga/search/view_doc.asp?symbol=A/res/56/83 (stating in Chapter II, Article 5 that the conduct of a non-public person or entity that is empowered by the law of the State will be considered to be an act of the State).

112 Gemplus, S.A. v. United Mexican States, ICSID Case No. ARB(AF)/04/3 & ARB(AF)/04/4, Award, ¶ 8-23 (June 16, 2010) (holding that a direct expropriation occurs if the state deliberately takes that investment away from the investor and finding that in terminating a concession the respondent effected an expropriation).

113 Julien, Chaisse, Promises and Pitfalls of the European Union Policy on Foreign Investment – How Will the New EU Competence on FDI Affect the Emerging Global Regime?, 15 J. INT’L ECON. L. 51, 66 (2012)Google Scholar.

114 As stated by Gemplus Arbitral Tribunal, “an indirect expropriation occurs if the state deliberately deprives the investor of the ability to use its investment in any meaningful way.” Gemplus, S.A., ICSID Case No. ARB(AF)/04/3, ARB(AF)/04/4, ¶ 8-23.

115 United Nations Conference on Trade and Development, Geneva, Switz., Jan. 2000, Taking of Property, 12, U.N. Doc. UNCTAD/ITE/IIT/15 (2000) [hereinafter UNCTAD].

116 Of course, although there are some variations

Catherine Yannaca-Small, OECD, “Indirect Expropriation” and the “Right to Regulate” in International Investment Law, in INTERNATIONAL INVESTMENT LAW: A CHANGING LANDSCAPE 43, 54 (2005), available at http://browse.oecdbookshop.org/oecd/pdfs/product/2005141e.pdf; see also Aaken, Anne Van, International Investment Law Between Commitment and Flexibility: A Contract Theory Analysis, 12 J. INT’L ECON. L. 507, 510-12 (2009)Google Scholar.

117 See Burlington Res. Inc. v. Republic of Ecuador, ICSID Case No. ARB/08/5, Decision on Liability, ¶ 471 (Dec. 14, 2012).

118 Yannaca-Small, supra note 116, at 45.

119 UNCTAD, supra note 115, at 12.

120 GATT, supra note 10, at art. XX.

121 There is a long-standing international debate over compensation that generally falls on a North-South divide. Industrialized countries have long advocated the so-called ‘Hull formula’ as a means to calculate compensation. See Yannaca-Small, supra note 116, at 44 n.1.

122 Two types of performance requirements have been identified: mandatory performance requirements and other performance requirements which are based on conditions that an investor must meet to secure a government subsidy or incentive. See Lee, Yong-Shik, Foreign Direct Investment and Regional Trade Liberalization: A Viable Answer for Economic Development?, 39 J. WORLD TRADE 701, 707 (2005)Google Scholar.

123 NAFTA – Chapter 11 – Investment, FOREIGN AFF. & INT’L TRADE CAN., http://www.international.gc.ca/trade-agreements-accords-commerciaux/agr-acc/nafta-alena/gen-nafta.aspx?view=d (last modified Jan. 2, 2013); see also Accord Entre le Gouvernement de la Republique Francaise et le Gouvernement D’Ukraine sur L’Encouragement et la Protection Reciproques des Investissements, Ukr.-Fr., art. II(6), May 3, 1994, http://unctad.org/sections/dite/iia/docs/bits/france_ukraine_fr.pdf (prohibiting “performance requirements … which specify that goods or services must be purchased locally”).

124 NAFTA – Chapter 11 – Investment, supra note 123.

125 Champion Trading Co. v. Arab Republic of Egypt, ICSID Case No. ARB/02/9, Award, ¶¶ 128, 156 (Oct. 27, 2006).

126 See Occidental Exploration & Prod. Co. v. Republic of Ecuador, LCIA Case No. UN3467, Final Award, ¶ 173 (July 1, 2004) (stating that “the purpose of national treatment is to protect investors as compared to local producers, and this cannot be done by addressing exclusively the sector in which the particular activity is undertaken”).

127 The scope and practical relevance of NT is to a large extent dependent on the reading of the term “like circumstances.” Its definition essentially sets the benchmark for national regulatory freedom to treat certain imported products differently from domestically produced. Indeed, “[o]ften the definition of national treatment is qualified by the inclusion of the provision that it only applies in ‘like circumstances’ or ‘similar circumstances.’ As the situations of foreign and domestic investors are often not identical, this language obviously leaves room open for interpretation.” EXPANSION OF TRADE AND FDI IN ASIA: STRATEGIC AND POLICY CHALLENGES 127 (Julien Chaisse & Philippe Gugler eds., 2009)

128 See, e.g., Bayindir Insaat Turizm Ticaret Ve Sanayi A.S. v. Islamic Republic of Pak., ICSID Case No. ARB/03/29, Award, ¶ 389-90 (Aug. 27, 2009) (holding that the tribunal must first assess whether the investor was in a “similar situation” to that of other investors, and if that requirement is met, then the tribunal must further inquire whether the investor was granted less favourable treatment than other investors); BG Grp. Plc. v. Republic of Arg., UNCITRAL, Final Award, ¶¶ 355-56 (Dec. 24, 2007) (stating that a measure that breaches national or MFN treatment would be unavoidably “discriminatory” for the purposes of the BIT standard).

129 Occidental Exploration & Prod. Co., LCIA Case No. UN3467, ¶¶ 175-176. Later in 2009, Bayindir v. Pakistan Award considered that the treaty clause must be interpreted in an autonomous manner, independently from trade law considerations. See Bayindir Insaat Turizm Ticaret Ve Sanayi A.S., ICSID Case No. ARB/03/29, ¶¶ 389, 402.

130 GATT, supra note 10, at art. XX. For instance, the Appellate Body then deliberated whether U.S. Section 609 was exercised in a manner constituting “arbitrary discrimination between countries where the same conditions prevail.” Appellate Body Report, Shrimp, supra note 70, ¶ 150. It concluded that the measure was applied in a manner which amounted to “a means not just of ‘unjustifiable discrimination,’ but also of ‘arbitrary discrimination’ between countries where the same conditions prevail, contrary to the requirements of the chapeau of Article XX. Id. ¶ 184. Under the facts of this case, “[t]he measure, therefore, [was] not entitled to the justifying protection of Article XX of the GATT 1994.” Id. ¶ 184.

131 An appropriate illustration is the Japan-Apples case. It is possible to deviate from Art XI for health and safety, but the chapeau always in play to ensure not just protectionism. See Panel Report, Japan—Measures Affecting the Importation of Apples, WT/ DS245/AB/R (June 23, 2005). For a commentary, see Committee on Trade and Environment, Note by the Secretariat: GATT/WTO Dispute Settlement Practice Relating to GATT Article XX, Paragraphs (b), (d) and (g), WT/CTE/W/203 (Mar. 8, 2002).

132 The Total v. Argentina tribunal noted that the undertaking of the host country to provide fair and equitable Treatment to the investors of the other party and their investments is a standard feature in BITs, although the exact language of such undertakings is not uniform, and the generality of the fair and equitable Treatment standard distinguishes it from specific obligations undertaken by the parties to a BIT. Total S.A. v. Argentine Republic, ICSID Case No. ARB/04/01, Decision on Liability, ¶ 106 (Dec. 27, 2010).

133 In this regard, Sempra Energy Int’l v. Argentine Republic notes that fair and equitable treatment is not a clear and precise standard and that it has evolved by case-by-case determinations. Sempra Energy Int’l v. Argentine Republic, ICSID Case No. ARB/02/16, Award, ¶ 296, (Sept. 28, 2007). Recently, El Paso Energy Int’l Co. v. Argentine Republic, citing the CMS Annulment Decision, agrees that there is variation in the practice of arbitral tribunals in relation to the fair and equitable standard. El Paso Energy Int’l Co. v. Argentine Republic, ICSID Case No. ARB/03/15, Award, ¶ 338, (Oct. 31, 2011).

134 Alpha Projektholding GmbH v. Ukraine, ICSID Case No. ARB/07/16, Award, ¶ 420 (Nov. 8, 2010).

135 Spyridon Roussalis v. Romania, ICSID Case No. ARB/06/1, Award, ¶ 314 (Dec. 7, 2011).

136 SAUR Int’l S.A. v. Argentine Republic, ICSID Case No. ARB/04/4, Decision on Jurisdiction and Liability, ¶¶ 485-88 (June 6, 2012).

137 GATT, supra note 10, at art. XX.

138 Parkerings-Compagniet v. Republic of Lithuania found that it is generally accepted that the variation of language between the formulation “protection” and “full protection and security” does not make a significant difference in the level of protection a host State is to provide. Parkerings-Compagniet AS v. Republic of Lith., ICSID Case No. ARB/05/8, Award, ¶ 354 (Sept. 11, 2007).

139 Saluka Invs. BV (The Netherlands) v. Czech Republic, UNCITRAL, Partial Award, ¶ 483 (March 17, 2006).

140 Vannessa Ventures Ltd. v. Bolivarian Republic of Venez., ICSID Case No. ARB(AF)/04/6, Award, ¶ 223 (Jan. 16, 2013).

141 Pantechniki S.A. Contractors & Eng’rs v. Republic of Alb., ICSID Case No. ARB/07/21, Award, ¶ 81 (July 28, 2009) (citing Andrew Newcombe & Lluís Paradell, Law and Practice of Investment Treaties 310 (2009)); see also Parkerings-Compagniet AS, ICSID Case No. ARB/05/8, ¶ 81-84.

142 For instance, Paushok v. Government of Mongolia notes that “legal protection” clause has been raised in a number of BIT cases and has sometimes been interpreted, as a stand-alone clause; as aiming at the physical protection of persons or assets against illegal actions by third parties; in the case before the tribunal the treaty provides clearly for “full legal protection to investments of investors of the other Contracting Party” and there is therefore no reason to limit the protection guaranteed to mere physical protection. Paushok v. Gov't of Mong., UNCITRAL, Award on Jurisdiction and Liability, ¶ 326 (Apr. 28, 2011); see also Unglaube v. Republic of Costa Rica, ICSID Case No. ARB/09/20, Award, ¶ 281 (May 16, 2012) (accepting that “full protection” may, in appropriate circumstances, extend beyond the traditional standard focused on physical security).

143 Frontier Petroleum Servs. Ltd. v. Czech Republic, UNCITRAL, Final Award, ¶ 263 (Nov. 12, 2010).

144 GATT, supra note 10, at art. XX.

145 The presumption enshrined in the Agreement on Technical Barriers to Trade probably is the best example. Several other WTO agreements, however, explicitly refer to other international agreements which indicates that investment treaties could employ the same technique. Many treaties have become part of the corpus of WTO law by incorporation and therefore serve as a direct or immediate source of law in WTO dispute settlement proceedings. These treaties include, most prominently, the substantive provisions of the major international intellectual property conventions referred to in the Agreement on Trade-Related Aspects of Intellectual Property Rights, namely the Paris Convention, the Berne Convention and the Treaty on Intellectual Property in Respect of Integrated Circuits (the latter never per se having entered into force). See Agreement on Trade-Related Aspects of Intellectual Property Rights, Apr. 15, 1994, Marrakesh Agreement Establishing the World Trade Organization, Annex 1C, 1869 U.N.T.S. 299.

146 The TBT Agreement addresses the question of scientific justification necessary for technical regulations that might inhibit international trade. Article 2.4 obliges, in principle, to use international standards where they exist. Agreement on Technical Barriers to Trade art. 2.4, Apr. 15, 1994, Marrakesh Agreement Establishing the World Trade Organization, Annex 1A, 1868 U.N.T.S. 120 [hereinafter TBT Agreement]. Article 2.5 provides that technical regulations are presumed, subject to rebuttal, not to create an unnecessary obstacle to international trade if they are either based on a risk assessment or set in accordance with relevant international standards. Id. At art. 2.5. In this connection, the TBT Agreement explicitly mentions the International Organization for Standardization (ISO). See generally Bernhard Jansen & Maurits Lugard, Some Considerations on Trade Barriers Erected for Non-Economic Reasons and WTO Obligations, 2 J. INT’L ECON. L. 530 (1999) (discussing four categories of trade barriers meant to protect non-economic interests).