Study On Relationships Between National Security Review On Foreign Investment And International Investment Agreements

The recent years have witnessed the continuous growth of international investment agreements (IIAs) with the majority of them being bilateral investment treaties (BITs). Meanwhile, the world is still influenced by investment protectionism as indicated by the establishment and improvement in many countries of the national security review system on foreign investment. Although the system as such is said to be intended for the protection of national security, in practice they are often employed as barriers to foreign investment and have caused serious loss on investors’side.In advising investors how to challenge unfair measures adopted for the national security review and avoid risks associated with such review, numerous scholars and practitioners have proposed that investors can invoke the investment agreement entered by its home country and the host country and the investor-state arbitration may be resorted to resolve disputes related to national security review. However, these are few studies on the feasibility and specifics of utilizing this method. This thesis is intended to discuss the relationship between the national security review on foreign investment and IIAs in terns of their effects and applications. Also the thesis tries to give options to strike a balance between the enforcement of national security review on foreign investment and the obligations under IIAs.The body of this thesis consists of the following seven chapters:Chapter I gives an introduction of typical cases where Chinese oversea investments were negatively affected by the national security review by the host country. This part is set to show the frequency and controversy of this kind of situations.Chapter II illustrates in a general way the relationship between the national security review on foreign investment and international investment law. It is pointed that the legal provisions underlying the national security review on foreign investment constitute part of international investment law and should represent the development of the latter.Chapter III through VI provides illustrations with regard to relationships between the national security review system on foreign investment and a series of clauses under IIAs. These include national treatment, fair and equitable treatment, essential security exception, and the investor-state dispute settlement mechanism. This chapter is intended to ask the possibility of challenging the national security measure under the international legal framework of IIAs and, by referring to the practice of domestic legislation and participationChapter VII, based on the discussion above, provides advice for improvements on China’s national security review on foreign investment.