NECESSITY DOCTRINE AND NON-PRECLUDED MEASURES PROVISIONS IN BILATERAL INVESTMENT TREATIES AS INVESTMENT PROTCTION IN EXCEPTIONAL CIRCUMSTANCES IN THAILAND

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จุติรัตน์ วรรณโชติ

Abstract

Necessity doctrine and non-precluded measures (NPM) provisions in bilateral investment treaties were studied as investment protection in exceptional circumstances in Thailand. NPM and exception provisions serve as safeguards to protect host state interests from threats caused by exceptional circumstances. As an exception to bilateral investment treaties, they preserve host states from being liable for damages to foreign investors while maintaining policy spaces. To determine NPM, international investment arbitrators apply the concept of necessity derived from international customary law and World Trade Organization (WTO) rules. The latter are seen as an example of the need for WTO law in investment activity, to develop international investment law principles and conditions in future. In December 2016, the Thai government announced its intention to close the Kingdom’s only active gold mine by the end of the year due to environmental concerns. This and related measures led to submission of a dispute for international investment arbitration by an affected foreign investor, claiming compensation. This case study applies to the use of general exceptions in the investment context and the importance of including NPM and exception provisions in Thai international investment agreements to best protect and maintain the Kingdom’s essential interests.

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