Published 24 August 2017
China's active role as both capital importer and capital exporter in the global economy is not matched by its diverse and often outdated bilateral investment treaties. This article examines the investment protection available to Chinese infrastructure investors under the Belt & Road Initiative. Going beyond the conventional account of three generations of Chinese investment treaties, the article collects data on all the Chinese investment agreements with the B&R countries, and develops an analytical framework tailored to the B&R Initiative's signature characteristic of infrastructure investments. It first describes how a typical infrastructure investment is structured under the B&R Initiative, and identifies the major risks that investment treaties can help mitigate. It then maps the variance in the treaties' major constituent elements and discusses the relevant jurisprudence. In particular, it analyses the issues that are most likely to arise in arbitral proceedings that involve infrastructure investments. Highlighted issues include whether Chinese state-owned enterprises are investors for the purpose of an investment treaty, how to interpret the restrictive scope of Investor-State dispute settlement provisions, whether a violation of contractual obligations amounts to expropriation and violation of the fair and equitable treatment standard. The analysis concludes by discussing potential avenues of ensuring better protection besides renegotiating the investment treaties.
This paper will be part of the TDM Special Issue on "One Belt One Road (OBOR)". More information here: https://www.transnational-dispute-management.com/news.asp?key=1652