Investor Presentaiton
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2. Treaty solutions
Many treaties do not include an umbrella clause at all. Omitting
them altogether is thus an option that removes some of the
uncertainty surrounding their meaning and effect.
A number of treaties, especially those concluded by the United
States, refer to the settlement of disputes arising from breaches of
"investment agreements" between investors and States as a separate
category of ISDS (see Section II.B.1.iv above). These agreements
are usually further defined in the IIA and do not cover all contracts
between an investor and a host State.
Some treaties containing more traditional umbrella clauses have
added a clarification aimed at excluding the availability of the IIA's
dispute settlement mechanism for disputes arising out of a contract
when there is a contractually specified dispute settlement provision.
For example, the Greece-Mexico BIT (2000) provides:
"Article 19. Application of other Rules
[...]
Each Contracting Party shall observe any other obligation it
may have entered into in writing with regard to a specific
investment of an investor of the other Contacting Party. The
disputes arising from such obligations shall be settled only
under the terms and conditions of the respective contract.
[...]." (Emphasis added).
In a similar vein, the Colombia-Japan BIT (2011) provides that
"where the written agreement referred to in paragraph 3 of Article 4
["umbrella" clause] stipulates a dispute settlement procedure, such
procedure shall prevail over this Chapter [ISDS]".
The Germany-Pakistan BIT (2009) seeks to reconcile the two
procedures in a more nuanced way:
UNCTAD Series on International Investment Agreements IIView entire presentation