Regulation by Exception – The Emergence of (General) Exception Clauses in International Investment Law?

Abstract

General exception clauses are increasingly gaining relevance in investment arbitration. Included in investment treaties to strengthen the right to regulate, these mechanisms have received mixed reactions in the literature. While being unacknowledged in arbitral practice for a long time, recent cases illustrate the difficulties in interpreting and applying general exception clauses. This contribution will reflect the role of general exceptions for investment treaties and its perception in the literature. Moreover, it analyzes some of the most pertinent issues in case law, such as its relationship to other defences in arbitral proceedings as well as the question whether successful invocation precludes compensation.