The Evolution of Investment Security Guarantees: History, Doctrine, and Arbitral Practice

The article examines the evolution of international legal guarantees of the security of foreign investments within the treaty-based framework of investment protection and in the practice of international investment arbitration. It identifies the role of the fair and equitable treatment standard and the full protection and security standard within the system of treaty guarantees, and analyses their legal nature, functions, and principal interpretative approaches developed in arbitral proceedings. Particular attention is paid to the relationship between treaty standards and customary international law, including the international minimum standard of treatment, as well as to the relevance of legal certainty, procedural safeguards, and proportionality of public interference when assessing the permissibility of the host State’s regulatory measures. It is argued that the stability of investment security guarantees is primarily determined by the treaty text and its interpretation in light of the object and purpose of the investment protection regime, while maintaining a balance between the protection of the investor’s legitimate interests and the State’s right to regulate within the limits of international legality.