Research Of Essential Security Exception Clause In Bilateral Investment Treaties

International direct investment plays an important role as a host country to attract foreign investment to develop its own economy and to show the international community the benchmark of its economic openness.Similarly,by investing overseas,investors can not only expand their international influence but also generate huge profits from their overseas markets.Due to the wide variety of political systems,economic development levels,and international discourse powers,it is difficult to reach large-scale and influential international multilateral investment treaties at the international level.At this time,the status of the Bilateral Investment Treaty(hereinafter referred to as BIT)is prominent.It plays a role in investment and protection between the capital exporting countries and the capital importing countries,and plays a role that cannot be underestimated.In the early BIT,both parties often defined the contracting purpose of BIT as protecting and promoting investment,so BIT is naturally value-oriented.Most of the terms of the bilateral investment agreements concluded between the countries are the commitments made by the host country to foreign investors and the protection of investors.With the development of international practice,some countries have begun to realize that they cannot restrict the rights of their own countries to protect the interests of foreign investors.At this point,the essential security exception clause appears in the treaty.The essential security exception clause in the BIT is differentfrom other provisions that protect and promote investment.As a clause in the BIT that“breaks” the purpose of protection and promotion of investment,it coordinates the host country’s attraction of attracting foreign investment and protecting national security,so that the two countries are in a relatively balanced state.In addition to the introduction and conclusion,this article will use three chapters to discuss the application of the essential security exception clause.The first chapter is an overview of the article and is divided into three sections.The first section introduces the concept of a essential security exception clause,which is divided into two parts in the concept.The first part is the concept of a essential security exception clause.The definition of the concept is first introduced from the perspective of four scholars.In order to better define the essential security exception clause,the author compares the essential security exception clauses in the US,Germany,Canada,and India bilateral investment agreement models.Then the author gives a definition of the essential security exception clause by summarizing and analyzing.The second part describes the types of underlying security exceptions.This article divides the underlying security exception clause into two categories based on whether there is a“it considers” in the clause,a essential security exception clause of the self-judgment model and a essential security exception clause of the non-self-judgment model.The classification of the above two modes paves the way for the discussion of the scope of the essential security exception clause in the second chapter of the dispute.The second section describes the evolution of the essential security exception clause.The essential security exception clause is not an original clause of the BIT,but is borrowed from the friendly trade maritime treaty.Therefore,this article is formally included in the BIT as a demarcation point with the essential security exception clause,and the change of the essential security exception clause is divided into two stages.The third section focuses on the composition of the essential security exception clause,and analyzes the application of the essential security exception clause from the perspectives of scope of application,value objective and relationship.In the scope of application,the main discussion of the essential security exception clause is applicable to the entire treaty,excluding all obligations conferred by the treaty,oronly applicable to specific clauses,as a disclaimer of specific obligations.The scope of application is different in international practice.The United States,Canada and India all advocate the application of the full text;Germany advocates specific application;our country analyzes it according to specific issues,and there is no consistent practice.However,looking at international practice,most countries extend the application of essential security exceptions to the entire treaty.The value goal mainly defines the value pursuit of the essential security exception clause.Traditional value objectives are primarily fundamentally safe,in addition to international peace and security,public order,public health,public health and public ethics.The value objective of the essential security exception clause is ultimately a game in which the host country regains sovereign rights from foreign investors.The relationship mainly discusses that the measures taken by the host country to safeguard the interests of the East must be related to the value objectives pursued.The second chapter is the typical application and dispute analysis of the essential security exception clause of The International Center for Settlement of Investment Disputes(ICSID).The second chapter,which is the core and focus of the article,consists of two sections.The first section is a brief introduction to the background and typical cases of the Argentine series of cases,and the second section is the focus analysis of the disputes of the case.The essential safety exception clause has been followed by scholars from various countries because of the Argentine series of cases at the beginning of this century.Due to the disagreement between ICSID on the application of the essential security exception clause,the arbitral tribunal finally made a ruling in the case of a similar arbitration request in the Argentine series of cases,similar defenses,and even the arbitrators of different cases.result.Therefore,the first section of Chapter 2 focuses on the background and case briefs of the Argentine case.In the first section,it is divided into four categories.The first item introduces the economic crisis in Argentina from the perspective of economy,law and policy.The Argentine economic crisis is not only the reason why Argentina cites the essential security exception clause to protect its own security,but also the dispute point of the scope of the essential security exception clause.The second and third items introducetwo typical cases in which the referee results in the Argentine series are reversed:LG&E v.Argentine government case,CMS company v.Argentine government case.These two cases were introduced because the CMS company v.Argentina government case was the first arbitral case made by the arbitral tribunal in the Argentine series of cases.Although the ICSID does not have rules that follow the precedent,the outcome of the ruling in this case serves as a weather vane for subsequent arbitral decisions in Argentina.However,the case had serious legal application errors and was subsequently revoked by the ICSID Special Committee.In contrast to this case,LG&E v.Argentine government arbitrators made an appropriate ruling.In the above two cases,the author will compare the arbitration request and reason of the US investor as the arbitration applicant and the arguments of the arbitral tribunal.The fourth item summarizes the controversial focus of the two typical cases and draws the following.The main points of controversy are: the arbitrability and review of the essential security exception clause;whether the essential security includes economic interests;the analysis of the essential security exception clause and the critical exception;the compensability of the essential security exception clause.The second section analyzes the focus of the disputes in the two disputed cases and the different views of the arbitral tribunal.The second section mainly consists of the arbitrability and review of the essential security exception clause,whether the essential security includes economic benefits,the analysis of the critical security exception clause and the critical exception,and the compensability of the essential security exception clause.In the arbitration and review of the essential security exception clause,it is first clear that arbitration and review are not the same concept.Arbitration is the premise and basis of the review,and the review is an affirmation of arbitration.At the same time,the scope and jurisdiction of the essential security exception clause of the self-judgment model and the non-self-judgment mode are different.The former follows the principle of good faith review and the latter follows the principle of comprehensive review.Whether the essential security includes economic benefits,both arbitral tribunals recognize that they include economic interests.Limiting essential security to the traditional military field has been unable toadapt to the development and changes of the times.At the same time,the International Court of Justice and the arbitral tribunal have also confirmed from the case that the loss of economic interests may endanger the country’s essential security.For the analysis of the essential security exception clause and the critical exception clause,the author distinguishes between the applicable conditions,the applicable premise,the scope of effectiveness,and the applicable order.Finally,the relationship between the two is discussed.For the compensability of the essential security exception clause,the comparative analysis supports two viewpoints of compensability and denial compensability.Finally,the author gives his own point of view.The author believes that after the application of the essential security exception clause,the host country should give foreign investors certain compensation from the perspective of fairness and justice,but the compensation standard can be discussed by both parties.The third chapter is the application and suggestion of the essential security exception clause in China.The first section introduces the overview of China’s investment profile and the application of the essential security exception clause.First of all,from the overview of China’s direct investment development,from the "2017China Foreign Direct Investment Statistics Bulletin" and "China Foreign Capital Statistical Bulletin 2018" to observe the profile of China’s foreign direct investment and foreign direct investment in China.Combined with the data published by the World Investment Report 2018 and the United Nations Conference on Trade and Development(UNCTAD),it discusses the status of China’s BIT and the status of the underlying security exception clause.Finally,it introduces the focus of China’s work in the BIT negotiations in the future-China-US BIT contract.From the Obama administration to the Trump administration,although the conclusion of BIT is intermittent,from a macro perspective,the conclusion of BIT between the two countries is the general trend.And the signing of the United States with the world’s largest economy needs to receive sufficient attention.The second section presents China’s attitudes and recommendations on the conclusion of essential security exceptions in the conclusion and revision of BIT.The author puts forward four suggestions here.First,China should include the essential security exception clause ofthe self-judgment model in the bilateral investment agreement.Second,the composition of strict essential security exceptions.Third,procedural constraints on the invocation of essential security exceptions.Fourth,the legal consequences of invoking the essential security exception clause are explicitly invoked.