Investor Presentaiton

54 INVESTOR-STATE DISPUTE SETTLEMENT: A SEQUEL (iii) Geographical application of the treaty The issue of geographical application of the treaty has two aspects. The first is that most IIAs cover investments "in the territory" of the contracting Party and thus exclude assets that may have some characteristics of an investment but are not physically located in its territory. Second, the geographical scope depends on the IIA's definition of the term "territory", in particular on whether the definition extends coverage beyond the boundaries of the territorial waters of a State to the continental shelf and exclusive economic zone. (iii) Temporal application of the treaty The main issue here is whether treaty protection extends to investments made before the entry into force of the agreement. Including them can significantly enlarge the number of covered investments. However, this approach does not mean that an IIA acquires retroactive effect as the IIA obligations apply only with respect to acts or facts occurring (or continuing to exist) after its entry into force. To reinforce this principle, IIAs that apply to investments made both before and after their entry into force specifically exclude claims arising out of events which occurred, and disputes which had been settled, prior to that date.41 40 A related issue is the exclusion of existing non-conforming measures. For example, the Canada-Czech Republic BIT (2009) specifies that protections do not apply to "any existing non- conforming measure" (Article IV(1)). 40 Article 28 of the Vienna Convention on the Law of Treaties. 41 E.g., Mexico-Singapore BIT (2009), Article 27. UNCTAD Series on International Investment Agreements II

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