A Conventional basis of fair and equitable treatment

‘Fair and equitable treatment’ is, at first, a conventional rule that is found in international investment treaties. Any analysis and construction of fair and equitable treatment therefore requires the identification of the conventional basis of such a norm and the different approaches to the formulation of particular clauses. Thereby, while most multilateral and bilateral investment agreements seem to deal with fair and equitable treatment, there is no commonly agreed clause with a fixed wording entailing fair and equitable treatment. However, the structure and content of bilateral investment treaties (BITs) exhibit notable similarities and hence allow for some type of generalisation. In respect of multilateral agreements, this also appears true, since these agreements have mainly incorporated the pattern already established in BITs. Nevertheless, certain variations in relation to the concrete drafting approach and the embedding of fair and equitable treatment into an investment agreement exist, which shall be outlined in the following.

No reference to fair and equitable treatment

Fair and equitable treatment is acknowledged as one of the most commonly used standards in investment agreements. However, there are several instances, especially in the early days of investment treaty practice, in which the standard has been omitted. These omissions do not seem to be owed to any aversions against the standard, but rather because the general pattern was not fully established when most of these treaties were concluded.