Research On Indirect Expropriation Problems Of Bilateral Investment Treaties

In the1990s, the meaning of indirect expropriation in international treaties began tobe amplified. Part of the reason is that direct expropriation in the usual sense is graduallyreduced, and accompanied the surge of bilateral investment treaties, the disputedcompensation standards have become no longer the center of the controversy, but theimportant reason of indirect expropriation becoming a new focus, is that it is once againcaused a war between the developing and developed countries.Indirect expropriation claims under international law are increasingly being seen asa threat to States’ police power. The inconsistent manner in which these claims are beingdealt with means that uncertainty prevails for both investors and States. There are threemain theories that have been proposed to resolve these problems. It is argued that the soleeffects doctrine should be preferred as the first choice, because it is more consistent withpre-existing law in this field. In order to resolve this issue in the interests of both theStates and investors, a balanced approach is required to determine whether a host State’sregulatory measure amounts to an indirect expropriation. An appropriately deferentialuse of proportionality analysis is a more coherent approach to indirect expropriation thatprovides greater space for host states to take measures in the public interest, yet providessufficient scrutiny to control misuse of public power.This article is divided into four parts. First, make the article refers to the concept of"indirect expropriation" clear, combined with the provisions in the relevant internationaltreaties, and summed up the definition of indirect expropriation. Second, research on theproblems of identification of "indirect expropriation". Third, sum up internationalarbitration organization’s trials about indirect expropriation cases. Finally, make analysisof indirect expropriation terms in the bilateral investment treaties which China has signed,and put forward recommendations on Improving China will sign indirect expropriationprovisions in the bilateral investment treaties.