Investment Disputes under China’s BITs

Abstract

This chapter first examines and compares the decisions rendered by arbitral tribunals and state courts, on the scope of the consent clauses contained in the Chinese bilateral investment treaties (BITs) of the first generation, with decisions rendered under other BITs with similar wordings. The decisions relating to Chinese BITs have contributed to the debate on the interpretation of treaties contained in arbitral awards that have extended the subject matter of the arbitral jurisdiction and the subsequent state court decisions that have reviewed, and on notable occasions have sanctioned these awards. These decisions contain more particulars pertaining to BITs emanating from socialists’ countries than characteristics specific to China’s BITs. The situation is different for other jurisdictional issues. The territorial jurisdiction of arbitral tribunals under the Chinese BITs—and whether they apply to a special administrative region (SAR)—was examined under the interpretation of the territorial scope of treaties and under the moving frontier rule and the exceptions to these principles, in particular the intent expressed by China. The question of the nationality of the investor seeking the protection of a Chinese BITs also raised Chinese characteristics, as it allowed for the first-time arbitral tribunals to apply, at an international level, the nationality test for both individuals and corporations established in the SARs contained in the municipal law.