CONTEMPORARY EURASIA VIII (2) ContEurVIII2 | Page 18

CONTEMPORARY EURASIA VIII (2)
and deprive the owner of the opportunity to manage or control its
property in a meaningful way. Those state actions are called “indirect
expropriation.” 60 The measures implemented by the state, while they
might not qualify as direct expropriation, can interfere with property
rights to such an extent that these rights are rendered so useless that they
must be deemed to have been expropriated, 61 are called different names:
“creeping”, “de facto” or “indirect” expropriation.
The Chinese-Armenia BIT contains the lawful expropriation
standards according to customary international law. Accordingly,
expropriationary measures carried out by the governments can be
qualified as lawful if the measures were being carried out in the public
interest, in accordance to the due process of law, on a non-discriminatory
basis, and with appropriate compensation. The absence of any of those
elements will qualify the measure as unlawful expropriation.
Investor-State Dispute Settlement Clauses
Investor-state dispute settlement (ISDS) clauses in investment
treaties are probably the most significant treatment standard provided,
which allow the investor to be able to bring a direct claim against the host
state in front of international arbiters. The settlement of disputes between
investors and the host state has been qualified as the key aspect of
investment protection provided in international investment treaties. 62
ISDS allows for the internationalization of investment disputes and a
neutral forum, which are an essential layer of protection for investors’
assets in the territory of the host state, according to the substantive and
procedural treatment standard spelled out in the treaty. 63
The Armenia–China BIT limits the dispute settlement clause to
“disputes concerning the amount of compensation from expropriation,”
which is a considerably restrictive approach. This formulation is very
restrictive and allows the claimant to refer its case to international
arbitration only related to the amount of compensation from expropriation,

60
UNCTAD, Expropriation (UNCTAD Series on Issues in International Investment
Agreements II, New York and Geneva, 2012, 5-7).
61 Starrett Housing v. Iran, Interlocutory Award No. ITL 32-24-1, 19 December 1983, 4
Iran-United States Claims Tribunal Reports 122, 154.
62 UNCTAD, Investor-State Disputes Arising from Investment Treaties: A Review
(UNCTAD Series on International Investment Policies for Development, New York and
Geneva, 2005, 1).
63 Valentina Vadi, "Critical Comparisons: theRole of Comparative Law in Investment
Treaty Arbitration," Denv. J. Int'l L. & Pol'y 39 (2010): 71.
18