Adapting Legitimate Expectations to International Investment Law: A Defence of Arbitral Tribunals' Approach
Published 21 May 2014
Abstract
The protection of investors' legitimate expectations under bilateral investment treaties, as part of the 'fair and equitable treatment' standard, is becoming highly criticised. The literature has often recognised that arbitral tribunals' adoption of the 'legitimate expectations' doctrine departs significantly from its origins in domestic administrative law. The use of the doctrine by arbitral tribunals is accordingly perceived as an excessive and undesirable fetter on a state's ability to achieve regulatory changes. This paper departs from these criticisms and takes a more sympathetic view of arbitral tribunals' practice. It interprets arbitral tribunals' adaption of the legitimate expectations doctrine as both pragmatic and largely necessary, in order to reconcile the objectives of international investment law with those of domestic administrative law.