Economic news Embassy 9 June 2008
When BITs bite back
This month around 20 members of the Association of Economic Representatives in London attended a seminar on Bilateral Investment Treaties at the City Law firm Allen and Overy.
The discussion was very timely especially since there has been a sharp rise in the number of BIT signed, combined with an explosion of claims made by investors, especially in the energy industry, made against host states.
Mark Levy of Allen and Overy explained to AERL members the benefits of BITs because a claim can be brought by an investor against a host without involving the home states, thereby ‘depoliticising’ the dispute and eliminating the risk of ‘gunboat diplomacy’.
The Q&A session raised interesting questions about sovereign wealth funds, and whether they would fall under a BIT because they are owned by another state.