Unlawful Investors Cannot Depend On Bilateral Treaties In A Dispute

Article by Gerold Zeiler and Katarina Hruskovicova

Many bilateral investment treaties (BITs) contain provisions under which investments have to be made in accordance with the host state's laws. A violation of domestic law bears the imminent danger that the investor will lose the protection of the BIT. Gerold Zeiler and Katarina Hruskovicova of Schoenherr address the scant jurisprudence on this point.

For many foreign investors, the protection of their investment by international law is an essential criterion when they decide to invest. The extent of this protection largely depends on whether the host state has concluded a BIT with the investor's home state and whether it is a party to the European Charter Treaty and to the Icsid Convention.