Application Of State Of Necessity In International Investment Arbitration

State of necessity,as a ground for precluding the wrongfulness of one state's act,has existed for a long time and the application field has extended from military to that of environment,economy,humanism,etc..For a long period of time,states frequently invoked this principle and further claimed to be exempted from liability. State of necessity was provided by International Law Commission(ILC) in Article 25 of ILC's Articles on State Responsibility and took it as one of six circumstances of precluding the wrongfulness of an act.However,ILC did not make an explicit definition for it.Recently,in several ICSID cases against Argentina,Argentina invoked state of necessity principle provided in Article 25 of ILCs Articles on State Responsibility as well as emergency clauses of the US-Argentina Bilateral Investment Treaty(BIT) to defend and further claimed to be exempt from responsibility,while the tribunals reached contrasting conclusions.State of necessity principle attracts people's attentions for its application in the international investment field.While the research of our country's scholars on this principle is relatively limited and this dissertation hopes to probe into the source of the state of necessity principle firstly and points out the problems existing in the process of international investment arbitration when that principle and emergency clauses are applied after analyzing these cases,and further makes some recommendations to improve relevant provisions of Sino-foreign BITs and customary international law.This dissertation consists of four chapters in addition to Preface and Conclusion.Chapter One introduces the historical evolution of state of necessity principle. Firstly,the author retraces the establishment of this principle by ILC;then introduces and compares some principles related to state of necessity principle-state of emergency in domestic law as well as derogation clause in international human right Chapter Two probes into the application of state of necessity principle as well as emergency clauses in the four Argentina involved international investment arbitration cases and makes brief analysis.Chapter Three discusses in detail several disputes and problems to be solved when state of necessity principle is applied to the international investment arbitration.There exist priority application issue of the similar regulations between ILC's Articles on State Responsibility and international investment treaty;as for the provisions of the state of necessity principle itself,there also exists several problems to be solved,such as scope of essential interest,judgment of severity of crisis,the only way and the compensation.Chapter Four put forwards recommendations for improvement of state of necessity principle.The author holds that,it is necessary to explicitly provide emergency clause in Sino-foreign BITs;as for state of necessity principle under customary international law,it is also necessary to further provide its substantive and procedural requirements.