The Temporal Scope of Application of Investment Treaties and the Effects on General International Law

Abstract

Stephen Hawking begins his exploration of the universe by observing that the strive for answers is ultimately dependent on the physical aspect of time: ‘Only time (whatever that may be) will tell’. Time is not only relative in the physical sense, though, but also the social construction of time varies greatly. This also extends to the realm of law, with legal periods, crucial dates and – last but not least – the scope of application of legal rules being dependent on a number of circumstances. Thus, the temporal scope of application constitutes one of the most crucial elements of treaty law. While the stages of the life of a treaty – from the moment of its adoption until the end of its legal consequences – depend on the will of the parties, the exercise of such will is embedded in an objective regime governing the legal effects and consequences of each stage. The interplay between treaty-specific provisions determining the scope of application of a specific agreement and the general law of treaties has particular relevance in the field of investment law, since tribunals are faced with several crucial moments in time which determine the rights and obligations arising under the specific international investment agreements (IIAs). Such moments in time arise both in relation to substantive questions, as well as in direct consequence to the stages of a treaty’s life (entry into force, provisional application, scope of dispute settlement clause). Hence, a number of questions of general international law, particularly treaty law, arise in this context. Their investigation is also of particular interest given the specific characteristics of investment treaties as treaties for the benefits of investors (third party beneficiaries). Even though owed to these specific characteristics questions of the general law of treaties may need specific answers in the context of investment law, such answers may nonetheless again feed back into the law of treaties. The symbiotic relationship between general international law and investment law has been observed on several occasions, e.g., in the context of substantive standards, or state responsibility. In light thereof, this contribution continues this investigation and focuses particularly on whether investment law (jurisprudence) provides answers to open questions of the general law of treaties relating to the temporal scope of application. The structure follows the relevant moments in time for a treaty, i.e. its entry into force, its life prior to entry into force by virtue of a treaty’s provisional application, and its ‘end of life’, particularly following mutual termination. Given the wide scope of the topic, not all issues arising in this context are addressed to the same extent. Focus is, however, placed on those cases which have the most to offer with regard to the general law of treaties, i.e., the question of the reach of an openly formulated dispute settlement clause, both with regard to preexisting disputes as well as continuing or composite acts, and the legal effects of provisional application. Moreover, as a special feature of investment law related to the ‘end of life of a treaty’, the cancellation of so-called ‘sunset clauses’ is explored from the perspective of the general law of treaties. Owed to the fact that treaty terminations and withdrawals have become more frequent in the field of investment law, the doctrinal discussion underlying many features of investment law – e.g., the nature of investor rights – but also the general law of treaties, i.e. the question of termination of treaties affording ‘third party rights’ may soon be enriched by a significant amount of case law. In a final part, the effects of these developments on general international law are discussed.