Research On Indirect Expropriation In Chinese International Investment Agreement

Recently,the identification standard of indirect expropriation has become the central topic of discussion.In the past,the research focus of the academic circle on indirect expropriation mainly focused on the compensation standard,but recently shifted to the identification standard of indirect expropriation.Indirect expropriation is a concept relative to direct expropriation,which has the characteristics of concealment and indirectness.There are three main standards for the identification of indirect expropriation: pure effect standard,purpose standard and the combination of effect and purpose,among which the combination of effect and purpose standard has gradually been widely accepted by the international community.The indirect expropriation clauses in different international investment treaties show different characteristics.The American BIT has more extensive influence,and its provisions on indirect expropriation are more detailed.Relatively developed investment treaties such as the RCEP,CPTPP and the USMCA all have high-standard indirect expropriation rules.From the international investment treaties signed with foreign countries,the regulation of indirect expropriation has shown a dynamic change process in different historical periods.The investment treaties signed in the 1980 s and 1990 s were mostly passive,and the rules of indirect expropriation were not yet perfect or even clearly distinguished from direct expropriation.There are many kinds of expressions about indirect collection in both our BIT and FTA.In the 21 st century,the indirect levy clause in the investment treaty has gradually been adjusted and upgraded.The mid-2006 BIT is a good example.Looking at the international investment treaties signed by our country,we can find the following problems of indirect expropriation rules: vague and inconsistent concept of indirect expropriation,inconsistent compensation standards of indirect expropriation,the scope of arbitration relief is too narrow,imperfect provisions of indirect expropriation exceptions and lack of cohesion of indirect expropriation rules in domestic law.In the new period,it is necessary to adjust the rules of indirect expropriation,considering the dual identities of the big foreign investor and the importing country,to balance the interests between the regulation right of host country and investors’ rights.Firstly,the concept of indirect expropriation should be defined,the wording should be unified,use the "equivalent effect" category of expression,and the criterion of "both effect and purpose" should be established as the identification method of indirect expropriation.Secondly,the compensation standard of indirect expropriation should be unified,and the method of "fair market value" should be adopted,supplemented by the method of actual loss and profit loss.Thirdly,set up a reasonable arbitration scope clause to avoid the scope of arbitration relief is too narrow.Again and again,improve the public interest clauses of indirect expropriation,and stipulate the exception of exception,reserve certain policy space for our country;Finally,it is necessary to improve the provisions on indirect expropriation in domestic law simultaneously,so as to strengthen the interaction between domestic law and international treaty.Indirect expropriation has gradually become an important issue leading to international investment arbitration.It is necessary to update the inopportune indirect expropriation rules in our investment treaties.