Research On The Problem Of “Treaty Shopping” In International Investment Arbitration

In recent years, there is an increasing number of international investment treaties and terms based on bilateral investment agreements and free trade agreements, in the meanwhile, there are various provisions of the "investor" definition and dispute settlement procedures. Therefore, investors can invest to the host country by Conduit company to achieve the purpose of “treaty shopping”. And according to the arbitration clause in the treaty, Host country will be drawn into the unsuspecting international investment arbitration procedure. However, an application for arbitration to the international arbitration institution through “treaty shopping”, whether therefore be a qualified institutional investor in that treaty, it need to be decided in accordance with the specific provisions in this investment treaty. With the different contents in investment treaties and to maximize the benefits of international investors, "Treaty shopping" phenomenon has been rampant in the international investment community. Special arrangements between the parties to the treaty could easily be destroyed, and judicial sovereignty of the host country will also face the risk of being trampled. How International arbitration institutions respond for investors whether is entitled to invoke a particular investment treaty or not, whether it is necessary and what should be do for china to restrict the Treaty Shopping in International Investment Arbitration, This paper is going to focus on these problem.The methods of Literature analysis, empirical analysis and comparative study will be used in this paper. Typical cases on “treaty shopping” in international investment arbitration will be introduced and compared. The thesis will seek the general rule on international arbitration institutions in dealing with “treaty shopping”, it also analyze and summarize relevant experience in different host countries to participate in the arbitration case and to provide reasonable proposals for china in response to the problem of "Treaty buy" in the international investment arbitration. This paper is divided into three chapters.Chapter 1 is an overview on “treaty shopping” in the international investment arbitration. First, it raises the question of “treaty shopping” in the international investment arbitration by the introduction of the famous case on Philip Morris. Then, the concept, classification and causes of “treaty shopping” will be introduced in turn.Chapter 2 will introduce the related arbitration cases, which involve treaty shopping in the international investment arbitration. By comparing the results of different cases, the paper seeks the general rule on international arbitration institutions in dealing with “treaty shopping”, and Analyze and summarize relevant experience in different host countries to participate in the arbitration case, and it looks for reasons on whether it is necessary to restrict "Treaty buy" in the international investment arbitration.Chapter 3 focuses on several suggestions on China’s response to the question of “treaty shopping” in the international investment arbitration. Firstly,the question of “treaty shopping” in the international investment arbitration can be prescribed in China’s "Foreign Investment Law" to make up for the vacancy of the current national legislation; Secondly, in the investment treaties which will be signed in the future, the definition of "investor" should be limited, and the denial of benefits clause can be added to reduce the space on "Treaty shopping"; Finally, according to the general rules of international arbitration institutions and respondent experience of the host country, "good faith principle" and “Piercing the corporate veil “can be used to against for the behavior of “treaty shopping “in the last line of defense.