Study On The Fair And Equitable Treatment Standard In International Investment Law: Trend And Strategy

Since its establishment, the Fair and Equitable Treatment Standard (FET) has become one of the most important standards in the investor protection area after years of practice. As an absolute standard, FET offers the investor high standard of protection. In sharp contrast to FET's ubiquitous, the standard is under great uncertainty. At present, the explanation of FET mainly relies on the ambiguous provisions in international investment agreements and decisions of tribunals. Opinions of these agreements and decisions vary and the discrepancy brings great uncertainty to the host states and investors which deters the smooth development of international investment. Only a definite FET can better promote the floating of international capital.Apart from the introduction and conclusion, this article is divided into four parts. The first chapter is the origin and development of FET. This chapter explains the development of FET in bilateral and multilateral treaties and provides background analysis for deeper discussion in the subsequent chapters. The second chapter is the explanation of FET. The author believes that the ambiguity of the FET clause is the source of controversy in the explanation of FET. The chapter compares the elements of FET and Minimum Standard of Treatment in order to distinguish these two different standards. The third chapter is the expanded explanation of FET. The chapter sums up the elements of legitimate expectations, stability and transparency which are applied by recent tribunals. The part points out the unreasonableness of this approach and makes clear the reasonable boundaries of FET. The last part is the legislation of China on FET and its improvement. This part analyzes the defects of FET clauses in Chinese investment agreements and the author gives his suggestions for improvement.