Most Favored Nation's Scope In Investor-State Arbitration

Many international investment treaties contain Most Favored Nation (MFN) clauses. Those clauses ensure that the signatory countries give preferential treatment to other signatories' nationals. Indeed, "the rise of international commerce in the late medieval period saw states adopting MFN clauses as a means of ensuring that their traders would compete in foreign markets on at least equal terms with traders from third states."¹ Through those clauses, the treaties' substantive protections — notably, Fair and Equitable Treatment (FET), Minimum Standards of Treatment (MST), Full Protection and Security (FPS), National Treatment (NT), Most Favored Nation (MFN) Treatment, Non-Discrimination, Compensation, Public Purpose, and Due Process — are regarded as importable through pertinent third-party treaties. The question is whether procedural provisions, such as exhaustion of local remedies, are similarly importable through the MFN clauses. The debate is brewing in