‘The Making of an Investment’ in the Context of the Temporal Scope of Investment Treaty Protection. Does the Indian Metals & Ferro Alloys Ltd v. Republic of Indonesia Award of 29 March 2019 Constitute a Breakthrough?

Michał Pyka

doi:10.21697/priel.2021.10.1.01

Published: 2021-04-21

Vol. 10 No. 1 (2021)

‘The Making of an Investment’ in the Context of the Temporal Scope of Investment Treaty Protection. Does the Indian Metals & Ferro Alloys Ltd v. Republic of Indonesia Award of 29 March 2019 Constitute a Breakthrough?

Michał Pyka

Polish Review of International and European Law

Section: Studies

https://doi.org/10.21697/priel.2021.10.1.01

Abstract

This contribution deals with the question of the legal character of investment treaty claims, brought to international investment arbitration, when alleged breaches of investment treaty obligations towards an investor occurred after the entry into force of an investment treaty but before the making of an investment by an investor. The analysis of the existing legal framework allows for the conclusion that the said acts of a host state are generally excluded from the scope of investment treaty protection. An arbitral tribunal neither has jurisdiction over these acts nor is it allowed to apply substantive treaty provisions thereto. This conclusion stems from the principle of intertemporal law and numerous provisions of investment treaties constituting the implementation or modification of this principle. Nevertheless, an arbitral tribunal is not fully deprived of the possibility of considering the acts of a host state preceding the making of an investment
and undertaken before any activity of the future investor took place. It can consider them as evidence of the intent of a host state, acts creating legitimate expectations of an investor or acts constituting elements of what is termed a continuing act.

Keywords:

international investment arbitration, investment treaties, principle of intertemporal law, ILC Articles on the Responsibility of States for Internationally Wrongful Acts, preestablishment expenditures, legality of an investment, legitimate expectations, continuing act

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Pyka, M. (2021). ‘The Making of an Investment’ in the Context of the Temporal Scope of Investment Treaty Protection. Does the Indian Metals & Ferro Alloys Ltd v. Republic of Indonesia Award of 29 March 2019 Constitute a Breakthrough?. Polish Review of International and European Law, 10(1), 9–42. https://doi.org/10.21697/priel.2021.10.1.01

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Michał Pyka

priel@uksw.edu.pl
https://orcid.org/0000-0003-4641-6987

Affiliation:

Jagiellonian University Poland

Bio Statement (e.g., department and rank)

PhD, assistant lecturer at the Jagiellonian University, Faculty of Law and Administration