Changes in Regulatory Framework as a Breach of Fair and Equitable Treatment in Investment Law

Abstract

The Master thesis researched a question of changes in the state’s regulatory framework as a basis of the frustration of legitimate expectations of investors, and consequently breach of FET. The research starts with the analysis of the nature of the FET standard, in order to find out its most appropriate interpretation and content. Demand for such a study is argued by lack of harmonized practice of interpretation of the FET standard, and therefore legitimate expectations, and absence of a single legal instrument that clearly defines its structural components and methodology of its interpretation. Further research of the author is concentrated on analysing the legitimate expectations of investor in relation to the predictable and stable framework of a state. Also, it was discovered that the most appropriate approach in determining whether changes of the state’s legal regulation would be declared as inconsistent with FET - balancing approach, including arbitrariness and proportionality analyses. Such an approach considers all relevant circumstances that influenced on the existence of legitimate and reasonable expectations of the investor and on the emergence of the necessity of the state to adopt certain measures.