Legal Research On The Umbrella Clause Of China Under The Perspective Of "One Belt One Road"

As one of the standards for protection in bilateral investment treaties,the umbrella clause does not follow the identical model in different treaties.Arbitral tribunals interpret treaties according to Vienna Convention on the Law of Treaties 1969,and their wider interpretation or a narrow one to that clause would affect directly that the contracts between the investors and the host country concluding under equal statutes would be covered fully by it or not.Within relative cases,an uncertainty arises from different legal backgrounds and views about the cases of arbitrators.The purpose of most bilateral investment treaties is to encourage investment and make a balance between investors and the host country.Therefore,the wider interpretation of the umbrella clausewould conform better to the principle of interpretation in good faith required by the convention.Countries along “One Belt One Road” do have high risks.For the protection of investment from China with taking count of national interests,signing bilateral investment treaties containing the umbrella clause with the countries along that area could use the term of “approved” to confine the investment contract,avoid the term of “any” to describe the investment obligations,and put the provision disputes settlement clause meanwhile.In addition,fork-in-the-road clause and non-precluded measures provisions should be set alternatively in the BITs so that the adverse effects of applying the umbrella clause to China as a host country would be reduced and more interpretive opportunities for national interests could be gained.