Examining Public Interest In Indirect Expropriation

Since the establishment of The International Center for Settlement of Investment Disputes(ICSID),there have been many cases concerning disputes between the domestic countries and the investors of other states,and there are more than 300 indirect expropriation claims among them.The ICSID's dispute resolving mechanism has already replaced the traditional way of foreign investment dispute settlement,such as diplomatic protection,and it has contributed a lot for the stable growth of foreign investment together with the international investment treaties.But,when it comes to droving the line between the legitimate regulatory power of the host states and the compensable regulatory takings some tribunals applied different criteria than others and this has become a source of criticism that come from the host states involved and the scholars.Traditional international investment law scholars believed that the disputes between the host states and the foreign investors arose due to the lack of foreign investment protection in developing countries or the protection standards in those countries were below from the fair and equitable treatment standard required in international law,and deemed it a traditional North-South Conflict in economic development.The critics think that the main purpose of current international investment treaties is to protect the interest of foreign investors,and this led to the one sided approach of the arbitrators to partially stressing the investor's interest and ignoring the public interest of the host states when deciding the equilibrium between the two.Those criticisms mainly focus on the different attitudes towards foreign investment protection between developed countries and the developing countries,and the current dispute settlement mechanism.This article starts from the public interest doctrine in international law and analyzes the expropriation clause,exception clauses which are closely linked to safeguarding the public interest in investment treaties.Next analyzes the way and criteria that the tribunals applied in examining and weighing the public interest in indirect expropriation claims.This article then argues that it is due to the ambiguity of the expropriation clause,exception clause,and the differences of the applicable law terms in the investment treaties that bring about the different conclusions when the tribunals examine and weigh the public interest in indirect expropriation cases,and it is reasonable and fair for the tribunals to get different conclusions as long as they base such a conclusion on the factual circumstances.