Due to the disruptive innovations the tech sector offers—possibly more than any other sector—companies have recently experienced rising regulatory friction with foreign governments. International regulations can sometimes be capricious, unfair, and designed to elicit compromises. International investment law and arbitration can act as a beneficial sword and shield in these situations to defend IT enterprises. While the tech sector has never been one to rely on investor-state arbitration, circumstances are changing. This paper analyses the role of the fair and equitable clause in investor-state disputes in the tech sector, following the intersection between the private tech sector and the host states through an investment agreement regime. The paper also brings out operational difficulties in implementation of the FET clause and the criticisms thereof. Moving on, the paper discusses the limited scope of the FET clause by citing various bilateral and multilateral investment treaties. The paper finally concludes that tech-related investor-state disputes is still an upcoming area of arbitration requiring time to undergo reforms; thus, it is suggested that the FET clause be given a wider interpretation to ensure operational efficiency.

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Demystifying Tech-Related Investor-State Arbitration: Understanding the Role of the FET Clause

  • Charvi Devprakash

摘要

Due to the disruptive innovations the tech sector offers—possibly more than any other sector—companies have recently experienced rising regulatory friction with foreign governments. International regulations can sometimes be capricious, unfair, and designed to elicit compromises. International investment law and arbitration can act as a beneficial sword and shield in these situations to defend IT enterprises. While the tech sector has never been one to rely on investor-state arbitration, circumstances are changing. This paper analyses the role of the fair and equitable clause in investor-state disputes in the tech sector, following the intersection between the private tech sector and the host states through an investment agreement regime. The paper also brings out operational difficulties in implementation of the FET clause and the criticisms thereof. Moving on, the paper discusses the limited scope of the FET clause by citing various bilateral and multilateral investment treaties. The paper finally concludes that tech-related investor-state disputes is still an upcoming area of arbitration requiring time to undergo reforms; thus, it is suggested that the FET clause be given a wider interpretation to ensure operational efficiency.