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Legal Assistant - Global Rights Compliance/United Nations International Residual Mechanism for Criminal Tribunals
I. Introduction
Such limitation or exclusion of treaty application may be effectuated either through a reservation (usually for multilateral treaties), or by including an unequivocal limitation clause in the treaty itself,2 having the effect of a Public Interest clause.
United Nations General Assembly Resolution No. 626 (VII), 21 December 1952; International Covenant on Economic, Social and Cultural Rights, 16 December 1966, 3 January 1976, Arts. 1, 25; The International Covenant on Civil and Political Rights, 16 December 1966, 23 March 1976, Arts. 1, 47; United Nations General Assembly Resolution No. 3201 (S-VI), 1 May 1974.
RREEF Infrastructure (G.P.) Limited and RREEF Pan-European Infrastructure Two Lux S.à r.l. v. Kingdom of Spain, ICSID Case No. ARB/13/30, Decision on Jurisdiction, 6 June 2016 , para. 85; Eiser Infrastructure Limited and Energía Solar Luxembourg S.à r.l. v. Kingdom of Spain, ICSID Case No. ARB/13/36, Award, 4 May 2017, paras. 186-187.
II. Rationale for treaty exclusions for natural resources
Treaty exclusions for natural resources direct the tribunal to assess whether the alleged treaty breach is excused on the basis of the exception. This differs from a situation where a tribunal balances the competing interests of investor protection with societal or environmental protection in determining a treaty breach, as is the case, for instance, where investment treaties simply emphasise on the importance of principles such as environmental protection and sustainable development in their preambles3 or special provisions.4
Agreement between the Belgium-Luxembourg Economic Union, on the one hand, and the Republic of Colombia, on the other hand, on the reciprocal promotion and protection of investments, 4 February 2009, Art. VII; U.S. Model Bilateral Investment Treaty 2012, Art. 12; Canada - Jordan BIT (2009), 28 June 2009, Art. 11; Canada - Latvia BIT (2009), 5 May 2009, Arts. II(5), XVII(2); Benin-Canada BIT (2013), 9 January 2013, Art. 16.
III. Types of treaty exclusions for natural resources
Investment treaties may incorporate natural resources exclusions in numerous ways:
Agreement between the Belgium-Luxembourg Economic Union, on the one hand, and the Republic of Colombia, on the other hand, on the reciprocal promotion and protection of investments, 4 February 2009, Art. VII; Argentina - New Zealand BIT (1999), 27 August 1999, Art.5(3); Agreement between the United States of America, the United Mexican States, and Canada, 30 November 2018, Art. 14.10(3)(c)(iii).
Canada Model FIPA 2014, Art. 18(1); Agreement Between the Government of Canada and the Government of the Republic of Ecuador for the Promotion and Reciprocal Protection of Investments, 29 April 1996, Art. XVII(3)(c); Investment Agreement For the COMESA Common Investment Area, 23 May 2007, Art. 22(1); SADC Model Bilateral Investment Treaty Template 2012, Art. 25.1; Canada – Peru BIT (2006), Art. 10(1); Canada - Romania BIT (1996), 17 April 1996, Art. XVII(3).
The General Agreement on Tariffs and Trade (GATT 1947), 30 October 1947, Art. XX; Agreement Between the Government of Canada and the Government of the Republic of Armenia for the Promotion and Protection of Investments, 8 May 1997, Art. XVII; ASEAN Comprehensive Investment Agreement, 26 February 2009, 24 February 2012, Art. 17(1).
Russian Federation - Sweden BIT (1995), 19 April 1995, Art. 3(3); Canada – Peru BIT (2006), Annex II, II-C-11; Treaty Between the Government of the United States of America and the Government of the Republic of Azerbaijan Concerning the Encouragement and Reciprocal Protection of Investment, 1 August 1997, Annex, para. 4.
Canada - Mali Foreign Investment Promotion and Protection Agreement, 28 November 2014, Annex II; Estonia - Morocco BIT (2009), 25 September 2009, Art. 2(5); Canada – Peru BIT (2006), Annex II, II-C-11; Treaty Between the Government of the United States of America and the Government of the Republic of Azerbaijan Concerning the Encouragement and Reciprocal Protection of Investment, 1 August 1997, Annex, para. 4.
Agreement between the United States of America, the United Mexican States, and Canada, 30 November 2018, Art. 14.10(3)(c)(iii); North American Free Trade Agreement, 17 December 1992, 1 January 1994, Art. 1106(6)(c); United States of America - Uruguay BIT (2005), 4 November 2005, 31 October 2006, Art. 8(3)(c)(iii); Canada – Peru BIT (2006), Annex II, II-C-11; Rwanda - United States of America BIT (2008), 19 February 2008, Art. 8(3)(c).
Agreement between the Belgium-Luxembourg Economic Union, on the one hand, and the Republic of Colombia, on the other hand, on the reciprocal promotion and protection of investments, 4 February 2009, Art. IX(3)(c); United States of America - Uruguay BIT (2005), 4 November 2005, Annex B(4)(b); Brazil - India BIT (2020), 25 January 2020, Art. 6.4; Investment Agreement For the COMESA Common Investment Area, 23 May 2007, Art. 20(8); U.S. Model Bilateral Investment Treaty 2012, Annex B; Canada Model FIPA 2014, Annex B.10(c).
Philippines-Germany BIT (1997), Ad Art. 2; Fraport AG Frankfurt Airport Services Worldwide v. Republic of the Philippines (I), ICSID Case No. ARB/03/25, 16 August 2007, Award, Dissenting Opinion of Mr. Bernardo M. Cremades (Award), paras. 9-12; Fraport AG Frankfurt Airport Services Worldwide v. Republic of the Philippines (I), ICSID Case No. ARB/03/25, Award, 16 August 2007, para. 345.
Bibliography
Hindelang, S. and Krajewski, M. (eds.), Shifting Paradigms in International Investment Law: More Balanced, Less Isolated, Increasingly Diversified, 2016.
Qalo, V., Bilateralism and Development: Emerging Trade Patterns, 2008.
Rabinowitz, R.W., Japan's Foreign Investment Law of 1950: A Natural History, 2003.
Southern African Development Community and others, Investment Regimes, Foreign Direct Investment Trends, and Characteristics in SADC Member States, 2010.
Yannaca-Small, K., Arbitration Under International Investment Agreements: A Guide to the Key Issues, 2010.