118 MIZAN LAW REVIEW, Vol. 8, No.1 September 2014
International investment law is one of the most dynamic fields of international
economic law. It is also one of the fields of international law discourse that is
subject to continuous policy debate. This comes as no surprise considering the
growing importance being given to protecting the flow of international
investment and how deeply its contents are inserted in domestic policy making
processes. The system is also influenced by the dynamics of globalization and
global governance, and by various economic reforms resulting in investment
disputes. In effect, the rules and principles of the regime are a flux. Treaty
practice and jurisprudence in the area constantly develop and global standards
are always in the making. Rethinking Ethiopia’s Bilateral Investment Treaties
(BITs) within this context is thus a natural response to evaluate the status of the
country’s obligations under the regime of evolving global investment standards.
However, it will be a disservice to attempt to evaluate the entire framework
of BITs signed by Ethiopia in such short article. Rather, for the moment, the
authors chose to examine one of the topical and hotly debated issues in the area;
the dynamism in relation to the concept of Most Favored Nation (MFN)
treatment. In particular the article addresses the nature and purpose of the clause
and its interaction with dispute resolution provisions contained in BITs by
taking recent developments in international investment dispute settlement.
Generally the aim of this article is to show how recent application of MFN
provision contained in basic treaty to benefit an investor from dispute settlement
provisions contained in another comparator treaty is paving new grounds of
application of the standard with the effect of stretching the country’s obligations
under the respective agreements.
The article thus attempts to elucidate the policy coherence pursued in this
line. In making this evaluation, an attempt is made to review all BITs signed by
Ethiopia and important international jurisprudence on the issue. In the
meantime, it is also to be seen that case law and academic literature on the topic
present constantly diverging stream of opinion. Thus, while the article attempts
to be comprehensive in this regard, it does not claim to cover all ground.
The first section of the article provides a general observation on the
development of BITs, by also putting the Ethiopian experience in context.
Section Two discusses the nature, purpose and scope of the MFN clause in
International Investment Agreements and also introduces the debate on its scope
of application to and its interaction with dispute resolution provisions contained
in BITs, which is the main subject matter of this article. Section Three deals
with the types of MFN questions raised in the debate in the context of the rules
contained under BITs sighed by Ethiopia. And finally, some observations of
arbitral practice are highlighted in Section Four with a brief conclusion in the