In the book’s concluding chapter, Attila Tanzi reflects on the combination of the Court’s overall ‘preservative rationale’ with its ‘restorative-distributive justice’ approach to issues of reparation, while at the same time offering insightful comments on the preceding chapters.
This article addresses the relationship between the protection of foreign investment and the protection of public interests of host States, with special regard to the public utilities sector when privately operated by foreign investors. It primarily focuses on an assessment of the scope of the concept of public interest particularly in the light of the interpretative developments concerning national security and general well-being that may be affected by foreign investment. The article highlights the trend gradually emerging from the recent international investment arbitration case law towards the harmonization between foreign investment interests and local public interests. It considers the policy rationale behind such a trend, as well as the legal reasoning and principles, with special regard to due diligence and proportionality, which may possibly enhance it.
This chapter investigates the importance and function of the investor’s good faith in investment arbitration. Good faith, a bona fide general principle of law, operates at several stages of the proceedings and gives rise to different more specific doctrines. Ascertainment of the investor’s good faith and the investment’s legality informs the tribunal’s determinations regarding its own jurisdiction, the claim’s admissibility, the State’s liability and the quantum of compensation. The chapter illustrates the role of good faith and its proximate declensions (estoppel, clean hands), accounting for the tribunals’ preference for nuanced solutions. The chapter also addresses the principle’s new frontier, relating to the investor’s compliance with standards of international law (which transcends the simple requirement of domestic legality). Ultimately, good faith is portrayed also as an interpretive benchmark rather than an autonomous rule of conduct: the case law shows that ‘bad-faith defences’ raised by the host State may steer the tribunal’s use of the applicable law and weaken – if not altogether bar – the investor’s claim.