ABSTRACT: This paper investigates the application of Community law as part of the law of the host state in investment treaty arbitration. In particular, it examines applicable law rules of investment treaties, default rules setting out applicable law rules, and umbrella clauses and broad jurisdiction clauses under such treaties. The author argues that the terms of a bilateral investment treaty (BIT), which derives from international law, define the scope and the limits of any reference to the law of the host state. In this sense, Community law, such as European Union and Andean Community law, can be applicable to investment treaty disputes as incorporated into the law of the host state, as long as the latter is the proper law of a particular legal relationship. The author concludes that, even where the frame of reference under the applicable law is state responsibility under international law, Community law may have implications which can be relevant for the interpretation of international standards under BITs.
Revista Brasileira de Arbitragem