Non-discrimination and other investment protection standards
This chapter deals with non-discrimination standards routinely included in IIAs, though often in different forms. Next to the two central non-discrimination standards of national treatment and MFN treatment, IIAs often also contain some specific prohibitions of arbitrary and discriminatory treatment. As we have already seen, the latter can also be regarded to form an inherent part of host state obligations under FET.
To give a little bit of historical background, reference shall be made to Elihu Root, one of the first presidents of the American Society of International Law, who gave what, at the time, was a very remarkable statement:
Each country is bound to give to the nationals of another country in its territory the benefit of the same laws, the same administration, the same protection, and the same redress for injury which it gives to its own citizens, and neither more nor less: provided the protection which the country gives to its own citizens conforms to the established standard of civilization.1
The relationship between national treatment, formulated very broadly, and an international minimum standard is quite obvious in this formulation. Each country is considered to be bound to give the same treatment to foreign nationals as to its own nationals. Such treatment may concern some crucial aspects of the exercise of state power, such as legislation, administration and the judiciary. However, the proviso here is – quite interestingly – that the protection which the country gives to its citizens conforms to the ‘established standard...
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