Iranian Journal of Trade Studies

Iranian Journal of Trade Studies

The Status and Validity of the Theory of Prohibition of Denial of Justice in Foreign Investment Rights

Document Type : Research Paper

Authors
seyedhamidreza malihi 1
mohammad bagher parsapour 2
1 Student of Tarbiat Modares university
2 Associate Professor in Tarbiat Modares University (Corresponding Author)
10.22034/ijts.2024.2024310.3968
Abstract
One of the most important factors to the growth of international investment is the trust of foreign investors in the judicial system of the host country and the fair handling of disputes between these investors and government of that country. Although there is no doubt about the necessity of this matter, it is very important to determine the legal basis of the government's obligation to conduct the above-mentioned proceedings and the limits of their obligations. One of the theories that can be the basis of the government's commitment to provide a fair judicial system in order to deal fairly with disputes caused by foreign investment, is the theory of denial of justice by governments. A theory that emerged in international law from the middle centuries of the Middle Ages and became a lever to protect the rights of foreign nationals, including foreign merchants. Although this theory was cited by arbitrators and international lawyers in many fields of international law, including human rights, international arbitration and foreign investment, but, continuously, its concept suffered ambiguity which necessitated more flexibility. After the major changes in international investment law and its transformation into a separate branch of legal science with its own resources, it raised serious doubts in the validity and possibility of using the historical concepts of this branch of law, including the concepts of the aforementioned theory. The question was that the theory can still be used to protect the rights of foreign investors and whether the limitations of this theory are still valid in protecting their rights or should a new basis be found to pursue the aforementioned goal? In this article, the primary goal of the authors is to remove the ambiguity from this historical theory and enumerate its examples using the judicial procedure and to recognize it as much as possible. Like in the past, is this theory with all its limitations the basis for foreign investors to enjoy justice? It seems that despite the fact that this theory itself has lost its relevance in the subsequent developments of foreign investment rights, it is still one of the definite examples of the violation of the host governments and its lack of relevance is only due to acceptance of more general standards in respect of the rights of foreign investors.
Keywords
Denial of Justice / Investment Treaty / Fair & Equitable Treatment / Foreign Investment

Subjects

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  • Receive Date 06 March 2024
  • Revise Date 02 April 2024
  • Accept Date 06 April 2024