Study On Legal Issues Of Cultural Heritage Protection In International Investment Law

Blankness exists in the international investment law concerning the protection of culturalheritage of the host country. When foreign investment causes threaten or damage of thecultural heritage, the government of the host country often makes response in ways ofdomestic law or administrative means. Such reactions are often deemed by investor to be abreach of the purpose of the investment agreement and constitute an expropriation, thus besuited in the arbitral tribunal.In the past arbitral awards, the arbitral tribunals expressed concern about the protectionof cultural heritage, and confirmed the right of expropriation of the host countryfor the protection of cultural heritage, but also expressed that such expropriation can notrelieve compensation liability. The legal issues on cultural heritageprotection in international investment law thus arise.In the process of expropriation identification, the standards adopted by the arbitraltribunals lack consistency. Both the standard of purpose and the standard of the pure effectobtained adoption, as well as other means in comprehensive identification ofexpropriation. In the judgment of compensation liability, arbitration tribunals inclined toadopting fair liability, while a certain flexibility during judgment is noticed.As a mode of dispute settlement, the Investors-country arbitration inevitably involvesin legal dispute resolution of the protection of cultural heritage. This arbitration absorbsthe advantages of the typical international commercial arbitration, but also has its owncharacteristics. The legal issues arising from how to using this dispute settlement tobalance the protection of cultural heritage of the host country and the interests ofinvestors caused extensive discussion of the academia. The practice of arbitration manifeststhat protection of cultural heritage requires multi-aspect resolution..China is the host country of the international investment and capital-exporting country,and also serves as a prominent country of cultural heritage protection. Thus the resolution ofthe conflict between international investment and protection of cultural heritage is of greattheoretical value and practical significance to China. The existing research on culturalheritage protection is rarely involved in international investment law. No research is made regarding the disputes between the host country and foreign investors due to the protection ofcultural heritage which frequently happened in last30years. Most existing research in Chinaare theoretical based and few is from the aspect of practice.The first part of this paper reviews all the researches about cultural heritage protection inand aboard. The second part pointes out the legal issues on protection of cultural heritage, andmainly focus on the problems arising after the situation when foreign investment threatens theprotection of cultural heritage in the host country, for instance, the right of expropriation innames of cultural heritage protection, the identification of expropriation, the standard ofcompensation and the dispute settlement mode. The third part makes analysis based on thetypical cases. The fourth part proposes legal recommendations in light of the problemsexisting in the protection of cultural heritage in Chinese legal system.