The treaty type which is subject to this analysis is a bilateral investment treaty made between Ethiopia and Kuwait (here in after contracting parties), which is signed 14/09/1996 and entered into force 12/11/1998. The author analyzed the treaty beginning from preamble to provision of duration and termination.
Table of Contents
I. Introduction
II. Body Part
A. Preamble
B. Scope and Definition
C. Treatment of Investments
D. Protection of Investments
E. Expropriation
F. Transfer of Related to Investments
G. Other Clauses
H. Settlement of Disputes
I. Institutional issues
J. Treaty Duration, Amendment and Termination
III. Conclusion
Objectives and Research Themes
The primary objective of this analysis is to critically examine the Bilateral Investment Treaty (BIT) between Ethiopia and Kuwait, which was signed in 1996. The paper evaluates the legal structure and provisions of the agreement, focusing on its effectiveness in governing investment relations, identifying potential regulatory gaps, and assessing its alignment with modern international investment standards.
- Legal scope and asset-based definitions within the treaty.
- Mechanisms for investment protection, treatment, and expropriation.
- Evaluation of Investor-State Dispute Settlement (ISDS) and State-to-State Dispute Settlement (SSDS).
- Critique of the treaty regarding sustainable development, environmental standards, and the right to regulate.
- Examination of institutional frameworks and treaty duration clauses.
Excerpt from the Book
E. Expropriation
Under article 6 of the treaty investments made by investors in the territory of either of the contracting states shall not be expropriated, nationalized, dispossessed or subjected to direct and indirect measures having effect equivalent to nationalization, expropriation, dispossession, except for public purpose and upon payment of prompt, adequate and effective compensation, on a non-discriminatory basis and in accordance with due process of law of general application. Such compensation shall amount to equal value of the expropriated investment, computed on basis of fair-market value (as of a principle) of the expropriated investment at a time immediately before the expropriatory action was taken or the impending expropriation become publicly known which is earlier. If fair market value can’t be readily ascertained the compensation shall be determined on equitable principles. The compensation finally determined shall be promptly paid to the investor in a freely convertible currency and without delay. The valuation and payment of compensation is subject to right prompt review by a judicial or any other competent and independent authority in that contracting state. The strongest side of this provision is it prohibits both direct and indirect type expropriation, and absolute right to compensation in certain circumstances. The grounds of expropriation are clearly mentioned.7 The critique this provision is that it doesn’t define what constitutes indirect expropriation.
Summary of Chapters
I. Introduction: Provides an overview of the Ethiopia-Kuwait bilateral investment treaty, noting the signing and entry into force dates, and outlines the scope of the legal analysis.
II. Body Part: Offers a detailed dissection of the treaty's specific articles, ranging from definitions and investor protections to dispute settlement mechanisms and termination clauses, while highlighting structural weaknesses.
III. Conclusion: Summarizes the overall regulatory framework of the agreement and reaffirms the necessity of acknowledging the identified critical deficiencies in the treaty's text.
Keywords
Bilateral Investment Treaty, Ethiopia, Kuwait, Investment Protection, Expropriation, ISDS, SSDS, Asset-based Definition, Fair and Equitable Treatment, Hull-doctrine, Regulatory Autonomy, Sustainable Development, Treaty Termination, Sunset Clause, Investment Law.
Frequently Asked Questions
What is the primary focus of this analysis?
The document provides a comprehensive legal analysis of the Bilateral Investment Treaty between Ethiopia and Kuwait, evaluating its provisions regarding the treatment and protection of investments.
What are the core thematic areas covered?
The core themes include definitions of investment and investors, investor-state dispute settlement (ISDS), expropriation rules, treatment standards, and treaty duration.
What is the overarching research goal?
The goal is to assess the treaty's legal functionality and identify gaps, such as the absence of social, environmental, and sustainable development considerations.
Which scientific or analytical method is applied?
The author performs a textual and legal critique of the treaty's articles, comparing them against standard international investment law practices.
What content is addressed in the main body?
The main body examines specific treaty clauses, including the Preamble, Scope and Definitions, Treatment of Investments, Protection, Expropriation, Transfer of Funds, and Dispute Settlement.
How would you characterize this work using keywords?
The work is characterized by terms such as Bilateral Investment Treaty, Investment Protection, Expropriation, ISDS, and Sustainable Development.
Does the treaty include a "sunset" clause?
Yes, the treaty includes a survival or "sunset" clause that keeps the provisions effective for 20 years after the date of termination for investments made prior to that date.
How does the author view the Expropriation provision in Article 6?
The author considers the prohibition of both direct and indirect expropriation a strength, but critiques the provision for failing to define what specifically constitutes "indirect expropriation."
What institutional mechanisms are missing in the treaty?
The analysis notes that the treaty lacks mechanisms for consultations between state parties, an institutional framework (committee), and provisions for technical cooperation or capacity building.
- Quote paper
- Tewachew Alem (Author), 2019, Analysis of the Ethiopia and Kuwait Bilateral Investment Treaty, Munich, GRIN Verlag, https://www.hausarbeiten.de/document/509392
