Fair and Equitable Treatment in Investor-State Dispute Settlement: A New Interpretative Framework


Journal of Business Law

A paraître

Départements : Droit et fiscalité, GREGHEC (CNRS)

The fair and equitable treatment (FET) standard has become the cornerstone of investor-state dispute settlement, and one of the most disputed notions in international business law. With investors facing increasing uncertainty, and states moving closer to denouncing treaties they see as limiting their sovereign right to regulate, FET has come to pose a significant risk to the entire investor-state dispute resolution system. This paper outlines an alternative way to consider FET, by acknowledging its thick and indeterminate character as a legal standard. It argues that previous traditional taxonomies have inherent limitations, and that practitioners should instead seek to understand the FET standard through the lens of the rule of law. The paper offers an analysis of the jurisprudence of the International Centre for the Settlement of Investment Disputes (ICSID) to show that three principles of the rule of law – due process, legal certainty, and the prohibition of arbitrariness – constitute an operational and certain, yet flexible framework of interpretation for the application of the FET standard