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Investor Presentaiton

52 INVESTOR-STATE DISPUTE SETTLEMENT: A SEQUEL of investments (pre-establishment" IIAs). Agreements of the latter type have wider breadth of coverage. IIA substantive obligations. The potential for IIA claims depends on the specific IIA obligations found in the treaty (for example, whether or not it includes a prohibition of performance requirements, an umbrella clause or the FET standard) as well as on the specific content of these obligations (whether or not the free- transfer provision is qualified by exceptions, whether the FET standard is qualified by reference to the customary international law minimum standard of treatment of aliens, etc.). The fewer and more circumscribed the obligations are, the less scope there is for ISDS. IIAs' substantive obligations can be delineated by general exceptions. The latter allow States to derogate from the IIA obligations when such derogation pursues a policy objective included in the general-exceptions clause. Such policy may include public health and safety, national security, environmental protection and some others. A number of treaties now contain general exceptions, but how they will work in practice is yet to be tested. (ii) Range of persons benefitting from the treaty ISDS involves a national or company of one State submitting a claim against another State. The underlying issue is whether the protections and rights contained in an IIA should be extended to a specific claimant. Through its definition of "investor", an IIA typically covers both natural and legal persons but there are a number of options to make the range of covered persons broader or narrower. Natural persons. IIAs typically apply to natural persons who are recognized by the domestic law of the relevant contracting party as a national or citizen. An IIA may, however, also extend beyond nationals to cover permanent residents of the State and thereby increase the scope of coverage. UNCTAD Series on International Investment Agreements II
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