Investment Treaty Arbitration

Investment Treaty Arbitration: Belgium

Overview of investment treaty programme

1. What are the key features of the investment treaties to which this country is a party?

Belgium

Nearly all of the bilateral investment treaties (BITs) that are the subject of this study were concluded by the Belgo-Luxemburg Economic Union (BLEU). The BLEU was established by treaty between Belgium and Luxembourg  in 1921 for the purposes of boosting commercial exchange, regulating customs and excise taxes, and setting up common monetary policies. The treaty establishing the BLEU was most recently extended in 2002, broadening the relationship to reinforce cooperation in international institutions, defence, development and peacekeeping.

When a treaty has not been concluded by the BLEU but rather by Belgium or Luxembourg alone, it shall be so noted.  

BIT Contracting Party or MIT1

Substantive protections

Procedural rights

Fair and equitable treatment (FET)

Expropriation

Protection
and security

Most-favoured-nation (MFN)

Umbrella clause

Cooling-off period

Local courts

Arbitration

1.

[Model BIT] (2002)2

Yes

Yes

Yes

Yes

Yes

6 months

Yes

Yes

2.

Albania (18 October 2002)

Yes

Yes

Yes

Yes

Yes

6 months

Yes

Yes

3.

Algeria (13 February1992)

Yes

Yes

Yes

Yes

Yes

6 months

No

Yes

4.

Argentina (20 May 1994)

Yes

Yes

Yes

Yes

Yes

None (for submission to local authorities)

Yes

Yes

5.

Armenia (19 December 2003)

Yes

Yes

Yes

Yes

Yes

6 months

Yes

Yes

6.

Azerbaijan (27 May 2009)

Yes

Yes

Yes

Yes

Yes

6 months

Yes

Yes

6.

Bangladesh (15 September 1987)

Yes

Yes

Yes

Yes

No

3 months

Yes3

Yes

8.

Benin (30 August 2007)

Yes

Yes

Yes

Yes

Yes

6 months

Yes

Yes

9.

Bolivia (10 January 2004)

Yes

Yes

Yes

Yes

Yes

6 months

No

Yes4

10.

Bosnia and Herzegovina (16 September 2010)

Yes

Yes

Yes

Yes

Yes

6 months

Yes

Yes

11.

Bulgaria (29 May 1991)5

Yes

Yes

Yes

Yes

No

6 months

Yes (expropriation compensation) only)

Yes (expropriation compensation) only)

12.

Burkina Faso (13 January 2004)

Yes

Yes

Yes

Yes

Yes

6 months

Yes

Yes

13.

Burundi ( 12 September 1993)

Yes

Yes

Yes

Yes

Yes

3 months

No

Yes

14.

Cameroon (1 November 1981)

Yes

Yes

Yes

Yes

No

6 months

No

Yes

15.

Chile (5 August 1999)

Yes

Yes

Yes

Yes

Yes

6 months

Yes

 

Yes

16.

China (5 October 1986)6

Yes

Yes

Yes

Yes

Yes

6 months (expropriation compensation only)

Yes

Yes (expropriation compensation only)

17.

China (1 December 2009)

Yes

Yes

Yes

Yes

Yes

6 months

Yes

Yes

18.

Croatia (29 December 2003)7

Yes

Yes

Yes

Yes

No

3 months

Yes

Yes

19.

Cyprus (5 June 1999)8

Yes

Yes

Yes

Yes

Yes

6 months

No

Yes

20.

Czech Republic9 (13 February 1992)

Yes

Yes

Yes

No

No

6 months

No

Yes

21.

Egypt (29 May 2002)

Yes

Yes

Yes

Yes

No

6 months

No

Yes

22.

El Salvador (12 November 2002)

Yes

Yes

Yes

Yes

Yes

6 months

Yes

Yes

23.

Estonia (23 October 1999)10

Yes

Yes

Yes

Yes

Yes

6 months

No

Yes

24.

FYROM (former Yugoslav Republic of Macedonia) (4 November 2002)

Yes

Yes

Yes

Yes

Yes

6 months

Yes

Yes

25.

Gabon (28 May 2005)

Yes

Yes

Yes

Yes

Yes

12 months

Yes

Yes

26.

Georgia (3 July 1999)

Yes

Yes

Yes

Yes

Yes

6 months

No

Yes

27.

Hong Kong (18 June 2001)

Yes

Yes

Yes

Yes

Yes

6 months11

No

Yes

28.

Hungary (28 September 1988)12

Yes

Yes

Yes

Yes

No

6 months

No

Yes

29.

India (8 January 2001)

Yes

Yes

No

Yes

Yes

6 months

Yes

Yes

30.

Indonesia (17 June 1972)13

Yes

Yes

Yes

Yes

No

None

No

Yes

31.

Kazakhstan (6 February2001)

Yes

Yes

Yes

Yes

Yes

6 months

Yes

Yes

32.

Korea, Republic of (27 March 2011)

Yes

Yes

Yes

Yes

Yes

6 months

Yes

Yes

33.

Kuwait (8 December 2003)

Yes

Yes

Yes

Yes

No

6 months

Yes14

Yes

34.

Latvia (4 April 1999)15

Yes

Yes

Yes

Yes

Yes

6 months

No

Yes

35.

Lebanon (5 March 2004)

Yes

Yes

Yes

Yes

Yes

6 months

Yes

Yes

36.

Libya (8 December 2007)

Yes

Yes

Yes

Yes

Yes

6 months

Yes

Yes

37.

Lithuania (6 September 1999)16

Yes

Yes

Yes

Yes

Yes

6 months

Yes

Yes

38.

Madagascar (29 November 2008)

Yes

Yes

Yes

Yes

Yes

6 months

Yes

Yes

39.

Malaysia (29 November 2008)

Yes

Yes

Yes

Yes

No

3 months

No

Yes

40.

Malta (15 June 1993)17

Yes

Yes

Yes

Yes

No

18 months

Yes

Yes

41.

Mauritius (16 December 2009)

Yes

Yes

Yes

Yes

Yes

6 months

Yes

Yes

42.

Mexico (14 March 2003)

Yes

Yes

Yes

Yes

Yes

6 months

Yes

Yes

43.

Moldova (20 April 2002)

Yes

Yes

Yes

Yes

Yes

6 months

No

Yes

44.

Mongolia (15 April 2000)

Yes

Yes

Yes

Yes

Yes

6 months

No

Yes

45.

Morocco (29 May 2002)

Yes

Yes

Yes

Yes

Yes

6 months

Yes

Yes

46.

Mozambique (1 September 2009)

Yes

Yes

Yes

Yes

Yes

6 months

No

Yes

47.

Paraguay (9 January 2004)

Yes

Yes

Yes

Yes

Yes

6 months

Yes

Yes

48.

Peru (12 September 2008)

Yes

Yes

Yes

Yes

No

6 months

Yes

Yes

49.

Philippines (19 December 2003)

Yes

Yes

Yes

Yes

Yes

6 months

Yes

Yes

50.

Poland (2 August 1991)18

Yes

Yes

Yes

Yes

No

6 months (expropriation claims only)

No

Yes (expropriation claims only)

51.

Romania (9 March 2001)19

Yes

Yes

No

Yes

No

None (for submission to local authorities)

Yes

Yes (expropriation compensation only)

52.

Rwanda (1 August 1985)20

Yes

Yes

Yes

Yes

No

18 months

Yes

Yes

53.

Russian Federation (13 October 1991)21

Yes

Yes

Yes

Yes

No

6 months (expropriation compensation only)

No

Yes (expropriation compensation only)

54.

Saudi Arabia (11 June 2004)

Yes

Yes

Yes

Yes

Yes

6 months

Yes

Yes

55.

Serbia (12 August 2007)

Yes

Yes

Yes

Yes

No

6 months

Yes

Yes

56.

Singapore (27 November 1980)

Yes

Yes

Yes

Yes

No

3 months

No

Yes

57.

Slovakia (13 February 1992)22

Yes

Yes

Yes

No

No

6 months

No

Yes

58.

Slovenia (14 January 2002)23

Yes

Yes

Yes

Yes

Yes

6 months

Yes

Yes

59.

South Africa (14 March 2003)24

Yes

Yes

Yes

Yes

Yes

6 months

Yes

Yes

60.

Sri Lanka (26 April 1984)

Yes

Yes

Yes

Yes

No

6 months

No

Yes

61.

Thailand (19 September 2004)

Yes

Yes

Yes

Yes

Yes

6 months

No

Yes

62.

Tunisia (18 October 2002)

Yes

Yes

Yes

Yes

Yes

6 months

Yes

Yes

63.

Turkey (4 May 1990)

Yes

Yes

Yes

Yes

Yes

12 months

Yes

Yes

64.

Ukraine (27 January 2001)

Yes

Yes

Yes

Yes

Yes

6 months

Yes

Yes

65.

United Arab Emirates (10 November 2007)

Yes

Yes

Yes

Yes

Yes

6 months (for submission to local authorities)25

Yes

Yes

66.

Uruguay (23 April 1999)

Yes

Yes

Yes

Yes

Yes

6 months (for submission to local authorities)

Yes

Yes

67.

Uzbekistan (6 February 2001)

Yes

Yes

Yes

Yes

Yes

6 months

Yes

Yes

68.

Venezuela (29 April 2004)

Yes

Yes

Yes

Yes

Yes

6 months

Yes

Yes26

69.

Vietnam (11 June 1999)

Yes

Yes

Yes

Yes

Yes

6 months

No

Yes

70.

Yemen (11 June 1999)

Yes

Yes

Yes

Yes

No

6 months

Yes

Yes

 

Substantive Protections

Procedural Rights

 

BIT Contracting Party or MIT

Fair and equitable treatment (FET)

Expropriation

Protection and Security

Most-favoured-nation (MFN)

Umbrella clause

Cooling-off period

Local courts

Arbitration

Energy Charter Treaty (16 April 1998 for Luxembourg; 6 August 1998 for Belgium)27

Yes

Yes

Yes

Yes

Yes

3 months

Yes

Yes

Yes

1 In addition to the 70 treaties set forth in this table, the BLEU has concluded BITs with a further 27 countries, namely: (1) Bahrain; (2) Barbados; (3) Belarus; (4) Botswana; (5) Brazil; (6) Comoros; (7) Democratic Republic of Congo; (8) Costa Rica; (9) Colombia; (10) Cuba; (11) Ethiopia; (12) ) Ivory Coast; (13) Guatemala; (14) Kosovo (entered into without prejudice to the positions of other countries on the status of Kosovo’s independence); (15) Liberia; (16) Mauritania; (17) Montenegro; (18) Nicaragua; (19) Oman; (20) Pakistan; (21) Panama; (22) Qatar; (23) Sudan; (24) Tajikistan; (25) Togo; (26) Uganda; and (27) Zambia. However, the treaties with these countries have not entered into force.

2 The Belgo–Luxembourg Model BIT can be found at: http://investmentpolicyhub.unctad.org/Download/TreatyFile/2831.

3 The text of this treaty does not provide for the possibility of investors pursuing local remedies. However, in the Exchange of Letters between the parties following the signature of the treaty, the parties agreed that investors “may, at their option, resort to the local remedies, either administrative or judicial, for settlement of such dispute before referring it to ICSID”.

4 This treaty provides that investors can choose between arbitration before ICSID, the ICC or the SCC. Bolivia denounced the ICSID Convention in 2007. To the extent arbitration before ICSID is no longer available, investors can still have recourse to arbitration before the ICC or SCC.

5 This treaty, like others in this table, is an intra-EU BIT, ie, a BIT between two EU Member States. It should be noted that the European Commission initiated infringement proceedings on 18 June 2015 against five Member States (Austria, the Netherlands, Romania, Slovakia and Sweden), requesting them to terminate intra-EU bilateral investment treaties between them. The Commission is requesting information from and initiating an administrative dialogue with the remaining 21 Member States who still have intra-EU BITs in place. According to the Commission, intra-EU BITs must be terminated because they “fragment the single market by conferring rights to some EU investors on a bilateral basis. Their provisions overlap and conflict with EU single market law on cross-border investments”. See European Commission – Press Release, “Commission asks Member States to terminate their intra-EU bilateral investment treaties”, available at http://europa.eu/rapid/press-release_IP-15-5198_en.htm.

6 Pursuant to EU Regulation 1219/2012 (OJ L 351, 20.21.2012, pp. 40 – 45), Member States have been required to report to the EU all BITs with non-EU countries they have signed, and which they want “to maintain in force or permit to enter into force”. This BIT was arguably terminated on 1 December 2009, when a new BIT came into effect between the BLEU and China (see line 17 of this table). However, Belgium has notified the EU, pursuant to EU Regulation 1219/2012, that this is a BIT that it wishes to “maintain in force”.

7See footnote 5 above.

8See footnote 5 above.

9 The BLEU concluded this treaty with Czechoslovakia on 24 April 1989. Czechoslovakia ceased to exist on 31 December 1992, becoming two separate nations: the Czech Republic and Slovakia. The treaty entered into force on 13 February 1992 in each of those nations, respectively, in addition to Belgium and Luxembourg. Cf. footnote 5 above.

10 See footnote 5 above.

11The cooling-off period is phrased differently in this BIT from others. This BIT provides that a dispute “shall, after a period of six months from written notification of the claim, be submitted to such procedures for settlement as may be agreed between the parties to the dispute. If no such procedures have been agreed within that six-month period, the parties to the dispute shall be bound to submit it to arbitration”.

12 See footnote 5 above.

13 This BIT was entered into between Belgium – not the BLEU – and Indonesia. 

14 This BIT provides that the investor can choose between arbitration and “any procedure agreed upon and applicable to the resolution of disputes”.

15 See footnote 5 above.

16 See footnote 5 above.

17 See footnote 5 above.

18 See footnote 5 above.

19 See footnote 5 above.

20 The BLEU and Rwanda concluded a new BIT on 16 April 2007.  It has not yet come into force.

21 This BIT was entered into between Belgium and Luxembourg, respectively – not as the BLEU – and the Union of Soviet Socialist Republics (USSR). The Russian Federation took over the rights of the USSR under this treaty. 

22 See line 20 regarding the Czech Republic; see also footnote 15.

23 Further to footnote 5 above, neither the BLEU nor Slovenia has reported this BIT to the EU (see OJ C 169, 5.6.2014, pp. 6, 79).

24 South Africa denounced this BIT, terminating it on 7 September 2012. A sunset clause in the BIT nonetheless continues to protect investments made before termination for a period of 10 years.

25 This treaty specifies that “local arbitration centers” qualify as local authorities.

26 This BIT provides that investors can choose between arbitration either before ICSID or under the UNCITRAL Rules. Venezuela denounced the ICSID Convention in 2012. To the extent arbitration before ICSID is no longer available, investors can still have recourse to arbitration under the UNCITRAL Rules.

27 Belgium and Luxembourg each adhered to the Energy Charter Treaty separately, not as part of the BLEU.

Qualifying criteria - any unique or distinguishing features?

2. What are the distinguishing features of the definition of “investor” in this country’s investment treaties?

Belgium

Issue

Distinguishing features in relation to the definition of “investor”

Legal persons as “investors”

The BLEU BITs generally require that, for legal persons to be considered investors of a Contracting State, they must: (i) be constituted in accordance with the laws of the relevant Contracting State; and (ii) have their registered office in the territory of that State.  Some BITs only impose condition (i), without also imposing condition (ii).28 At least one BIT also requires “business activity” in the territory of the relevant Contracting State,29 and another imposes the additional requirement of “residence”.30

Companies controlled by investors as “investors”

The BLEU BITs generally do not foresee the possibility of companies controlled by investors to be considered as investors themselves. There are exceptions to this rule. Some BLEU-BITs allow companies controlled by investors to be considered as investors, but only to the extent the company controlled is not located in one of the Contracting States.31 Other BLEU BITs do not impose such a requirement, allowing the controlled company to be located anywhere.32  

Natural persons as “investors”

Under the BLEU BITs, physical persons usually qualify as an investor when he or she is considered a citizen under the laws of the relevant Contracting State. Only rarely do BLEU BITs impose a residence requirement.33 

Governments as “investors”

Three BLEU BITs have extended the definition of investor to include certain governments. The BLEU-Kuwait BIT defines “the Government of the State of Kuwait” as an investor. A similar provision can be found in the BLEU-Saudi Arabia BIT. For its part, the BLEU-UAE BIT defines the governments of both Contracting States as investors.

Investors’ rights in case of multiple applicable treaties

The BLEU’s BITs generally do not limit the ability of investors to bring claims under multiple treaties. The one exception to this appears to be the BLEU-Morocco BIT, which provides that an investor loses the right to protections under the treaty if the investor has invoked the dispute resolution provisions of another BIT “concluded by a Contracting Party on the territory on which the investment has been effected”.

28 See, e.g., Bangladesh, Egypt, Hong Kong, India, Korea, Kuwait, Malaysia, Sri Lanka, Tunisia, Yemen. 

29 See Chile.

30 See Libya.

31 See, e.g., India, Mozambique, Peru.

32 See, e.g., Morocco, Philippines, Thailand, Venezuela. 

33 See, e.g., Bosnia and Herzegovina, Hong Kong.

3. What are the distinguishing features of the definition of "investment" in this country’s investment treaties?

Belgium

Issue

Distinguishing features in relation to the concept of “investment”

Definition of investment

As set forth in the Model BIT, most BLEU BITs define investment as “every kind of asset and any direct or indirect contribution in cash, in kind or in services, invested or reinvested in any sector of economic activity”. Some older BITs simply define an investment as “any kind of asset”. The BITs then generally go on to set forth a non-exhaustive list of protected investments. One BIT has further defined investments only as those “made in view of establishing sustainable economic links with a company”.34 

Requirement for government approval

In certain countries, an investment can only benefit from the protections of the relevant BIT if the investment has “received written approval from the competent authority”.35

Compliance with national law

A handful of BLEU BITs require that any investments be made in accordance with national law.36 

Exclusions

At least one BIT has limited protected investments to certain fields.37  Others have excluded from the definition of investment payments or loans to a State or State-owned company.38

Previous investments

As set forth in the Model BIT, most BLEU BITs provide that they “apply to investments made before [the treaty’s] entry into force by

investors of one Contracting Party in the territory of the other Contracting Party in accordance with the latter’s laws and regulations”.  At least two BITs set the prior date as of which investment protection is afforded.39 

34 See Mexico.

35 See, eg, Thailand, Singapore, Sri Lanka.

36 See, eg, Albania, Argentina, China, Egypt, India, Indonesia, Philippines, Russia, Saudi Arabia, Serbia, Singapore, Sri Lanka, Thailand, Yemen.

37 See Indonesia, limiting investments to the fields of agriculture, industry, mining, forestry, communications and tourism.

38 See, eg, Peru and Mexico.

39 See Tunisia, setting the date at 1 January 1957; Vietnam, setting the date at 30 April 1975.

Substantive protections - any unique or distinguishing features?

4. What are the distinguishing features of the fair and equitable treatment standard in this country’s investment treaties?

Belgium

Issue

Distinguishing features of the fair and equitable treatment standard

Definition of fair and equitable treatment

As set forth in the Model BIT, most BLEU BITs provide that “[a]ll investments, whether direct or indirect, made by investors of one Contracting Party shall enjoy fair and equitable treatment in the territory of the other Contracting Party”. 

Relationship with customary international law

In most BLEU BITs, fair and equitable treatment is guaranteed as a protection that is “in no case less favorable than [that] recognized under international law”. Nearly all BLEU BITs that guarantee at least international law protection with respect to fair and equitable treatment also do so with respect to “continuous protection and security”,40and sometimes, but less often, with respect to expropriation.

40 Exceptions to this are, e.g., Turkey and Venezuela.

5. What are the distinguishing features of the protection against expropriation standard in this country’s investment treaties?

Belgium

Issue

Distinguishing features of the “expropriation” standard

Expropriation standard

As set forth in the Model BIT, most BLEU BITs establish that “[e]ach Contracting Party undertakes not to adopt any measure of expropriation or nationalisation or any other measure having the effect of directly or indirectly dispossessing the investors of the other Contracting Party of their investments in its territory”. At least one BIT has given examples of what amounts to indirect expropriation: “freezing or blocking the investment, raising arbitrary or excessive taxes, forced sale of all or part of the investment, or other comparable actions or measures”.41

Conditions for expropriation

As set forth in the Model BIT, most BLEU BITs contain the following provision for expropriation: “If reasons of public purpose, security or national interest require a derogation from the [expropriation standard], the following conditions shall be complied with: a) the measures shall be taken under due process of law; b) the measures shall be neither discriminatory, nor contrary to any specific commitments; c) the measures shall be accompanied by provisions for the payment of an adequate and effective compensation.” There are few deviations from these conditions, although at least two BITs provide that the “public purpose” for any expropriation should simply be related to the “internal needs” of the relevant party42; at least two other BITs define due process with reference to local law,43 whereas another does not mention due process at all.44

Compensation standard

As set forth in the Model BIT, most BLEU-BITs set the compensation standard for expropriation as “the actual value of the investments on the day before the measures were taken or became public”. Several BITs have nonetheless set the point in time for determining the value of the investment with reference to the day of the taking or its publication, as opposed to the day before.45 At least one other has set the point in time with reference to the moment “immediately before the impending expropriation becomes public knowledge”, without reference to the moment of the taking itself.46 Yet another BIT provides that the valuation of the expropriation “will not be influenced by the fluctuations in value due to the fact that the intention to expropriate was already known before the operation”.47

Other BITs set forth rules for determining the value of the investment when the value cannot otherwise be easily ascertained, requiring the application of “generally recognized principles”.48 At least one BIT provides that “[i]f an investment does not have a market value or when the investor concerned proves that the market value of the expropriated investments is less than the real and objective value, the compensation is fixed on the basis of this latter value”.49

Right to review

A number of BLEU-BITs foresee the possibility of a local authority to review the conditions of the taking, the value set for compensation, or both.50 

General payment and standard

As set forth in the Model BIT, “compensation shall be paid in the currency of the State of which the investor is a national or in any other convertible currency. It shall be paid without delay and shall be freely transferable. It shall bear interest at the normal commercial rate from the date of the determination of its amount until the date of its payment.” Some BITs do not foresee awarding interest,51or will only award interest if “compensation is unduly delayed [...] for the period of such delay”.52  At least one BIT provides that “[i]n case of unjustified delay [in payment of the compensation], a new evaluation will be done at the request of the investor with a view to correcting the effects of the situation”.53

Assets of a company

A number of BLEU BITs expressly provide that protection against expropriation shall also apply “where a Contracting Party expropriates the assets of a company which is constituted under the laws in force in any part of its own territory and in which the investors of the other Contracting Party own shares”.54

41 See Kuwait.

42 See, e.g., Bangladesh and Hong Kong.

43 See, e.g., Malaysia and Saudi Arabia.

44 See Singapore.

45 See , e.g., Indonesia, Singapore, Turkey.

46 See Philippines.

47 See Mexico.

48 See, e.g., Hong Kong, Kuwait, UAE.

49 See Burundi.

50 See, e.g., Gabon, Hong Kong, India, Korea, Kuwait, Saudi, Serbia, Thailand, Uzbekistan, Yemen.

51  See, e.g., Bangladesh, Indonesia, Tunisia, Turkey.

52 See Philippines.

53 See Yemen.

54 See, e.g., Bangladesh, Cameroon, Gabon (only if the company is not otherwise entitled to bring a claim), Hong Kong, India, Korea, Lebanon, Malaysia, Mozambique, South Africa, Singapore, Thailand.

6. What are the distinguishing features of the national treatment/most-favoured-nation treatment standard in this country’s investment treaties?

Belgium

Issue

Distinguishing features of the “national treatment” and/or “most favoured nation” standard

Scope of national treatment/ MFN treatment

Most BLEU BITs contain separate articles dealing with national treatment and/or MFN treatment that apply to all protections in the treaty. Several BITs specify that national treatment/ MFN treatment only apply to certain specific protections in the treaty.55

Limits to national treatment

Roughly half of BLEU BITs provide for national treatment. When national treatment is foreseen, such treatment is generally only guaranteed in connection with the “operation, management, maintenance, use, enjoyment, sale, or other disposal of investments”.

Limits to MFN treatment

The BLEU BITs generally provide that the obligation to provide most favoured nation treatment does not extend to the benefits of: (i) membership of a customs union, monetary union, or free trade area; and (ii) any agreements on taxation. Some BITs have only excluded MFN treatment with respect to (i), not (ii).56 Others have not included any such exceptions.57 In addition, one BIT provides that MFN is also excluded in the case of “any arrangement for facilitating small scale frontier trade in border areas”.58 Another BIT provides that “most favorable national treatment shall not be applied to matters related to procedural or juridical matters”.59

55 See, e.g., Albania, Burundi, Indonesia, Malaysia, Yemen.

56 See, e.g., Algeria, Azerbaijan, Egypt, El Salvador, Georgia, Kazakhstan, Malaysia, Moldova, Mongolia, Tunisia, Turkey, Ukraine.

57 See, e.g., Cameroon, Indonesia, Singapore, Uruguay, Uzbekistan, Venezuela, Vietnam.

58 See new China.

59 See UAE.

7. What are the distinguishing features of the obligation to provide protection and security to qualifying investments in this country’s investment treaties?

Belgium

Issue

Distinguishing features of the “protection and security” standard

Extent of obligations

As set forth in the Model BIT, most BLEU BITs provide that “[e]xcept for measures required to maintain public order, such investments shall  enjoy continuous protection and security, i.e. excluding any unjustified or  discriminatory measure which could hinder, either in law or in practice, the management, maintenance, use, possession or liquidation thereof.”  Several BLEU BITs contain language different from the general definition, providing only for “full protection”,60 or “full legal protection”.61

60  See, e.g., Indonesia and Malaysia.

61  See Yemen.

8. What are the distinguishing features of the umbrella clauses contained within this country’s investment treaties?

Belgium

Issue

Distinguishing features of any “umbrella clause”

Extent of obligations

As set forth in the Model BIT, the umbrella clauses in most BLEU BITs provide that “[e]ach Contracting Party undertakes to ensure at all times that the commitments it has entered into vis-à-vis investors of the other Contracting Party shall be observed.”   One BIT contains a reciprocal umbrella clause, providing that each Contracting Party must respect its commitments in relation to the investors of the other Contracting Party, and “investors should on the other hand respect and comply with the terms and conditions of their commitments.”62

9. What are the other most important substantive rights provided to qualifying investors in this country?

Belgium

Issue

Other substantive protections

Armed conflict/civil unrest

With few exceptions,63 and as set forth in the Model BIT, nearly all BLEU BITs provide that “[i]nvestors of one Contracting Party whose investments suffer losses owing to war or other armed conflict, revolution, a state of national emergency or revolt in the territory of the other Contracting Party shall be granted by the latter Contracting Party a treatment, as regards restitution, indemnification, compensation or other settlement, at least equal to that which the latter Contracting Party grants to the investors of the most favoured nation.”

Transfer

All BLEU-BITs contain a provision along the lines of the following: “Each Contracting Party shall guarantee to investors of the other Contracting Party the free transfer of all payments relating to an investment.”

Subrogation

All BLEU BITs contain a provision along the lines of the following: “1. If one Contracting Party or any public institution of this Party pays compensation to its own investors pursuant to a guarantee providing coverage for an investment, the other Contracting Party shall recognise that the former Contracting Party or the public institution concerned is subrogated into the rights of the investors. 2. As far as the transferred rights are concerned, the other Contracting Party shall be entitled to invoke against the insurer who is subrogated into the rights of the indemnified investors the obligations of the latter under law or contract.”

63 Those exceptions are, for example, Algeria, Bangladesh, Indonesia, Malaysia, Sri Lanka, Turkey.

Procedural rights in this country’s investment treaties

10. Are there any relevant issues related to procedural rights in this country’s investment treaties?

Belgium

Issue

Procedural Rights

Restrictions on right to refer to arbitration

A number of BLEU BITs foresee that the investor must first resort to local remedies first for a certain period of time before international arbitration becomes available.64 Other BITs provide that if the investor chooses to resort to local remedies first, there is a waiting period before international arbitration becomes available.65

National arbitration

Two BITs expressly foresee national arbitration as among the local remedies to which an investor can resort.66

Waiver of local remedies

Some BLEU BITs expressly provide that, in the event an investor resorts to arbitration, the investor must waive any local remedies.67

Menu of arbitral institutions

With one exception,68 all BLEU BITs foresee the possibility of pursuing arbitration before ICSID.  In decreasing order of frequency, BLEU BITs will also add the possibility of arbitration under the UNCITRAL Rules, before the ICC, and before the SCC.

Applicable regulations

As set forth in the Model BIT, most BLEU BITs contain a provision along the lines of the following: “If an issue relating to investments is covered both by this Agreement and by the national legislation of one Contracting Party or by international conventions, existing or to be subscribed to by the Parties in the future, the investors of the other Contracting Party shall be entitled to avail themselves of the provisions that are the most favorable to them.”

Consolidation of procedures

The BLEU-Mexico BIT foresees a procedure for consolidating two or more pending arbitrations, which requires the constitution of a “consolidation tribunal”.

64 See, e.g., Argentina (18 months), Romania (2 years), UAE (15 months).

65  See, e.g., Chile (18 months), Paraguay (18 months), Uruguay (18 months).

66  See Madagascar and UAE.

67  See, e.g., China, India, Peru, Philippines, Saudi Arabia, Turkey, Venezuela.

68  See Hong Kong.

11. What is the status of this country’s investment treaties?

Belgium

The European Commission initiated infringement proceedings on 18 June 2015 against five Member States (Austria, the Netherlands, Romania, Slovakia and Sweden), requesting them to terminate intra-EU bilateral investment treaties between them. The Commission is requesting information from and initiating an administrative dialogue with the remaining 21 Member States who still have intra-EU BITs in place. According to the Commission, intra-EU BITs must be terminated because they “fragment the single market by conferring rights to some EU investors on a bilateral basis. Their provisions overlap and conflict with EU single market law on cross-border investments”. See European Commission – Press Release, “Commission asks Member States to terminate their intra-EU bilateral investment treaties”.

Practicalities of commencing an investment treaty claim against this country

12. To which governmental entity should notice of a dispute against this country under an investment treaty be sent? Is there a particular person or office to whom a dispute notice against this country should be addressed?

Belgium

Government entity to which claim notices are sent

As a general rule, BLEU BITs do not specify the governmental entity to which a dispute notice should be sent. We recommend sending any notices to the Prime Minister, Ministry of Foreign Affairs and, in the case of Belgium, also to the relevant regional government (Flanders, Wallonia or Brussels-Capital).

13. Which government department or departments manage investment treaty arbitrations on behalf of this country?

Belgium

Government department which manages investment treaty arbitrations

In the one investment arbitration filed to date against Belgium, the Ministry of Finance and the General Administration of the Treasury managed the matter. 

14. Are internal or external counsel used, or expected to be used, by the state in investment treaty arbitrations? If external counsel are used, does the state normally go through a formal public procurement process when hiring them?

Belgium

Internal/External Counsel

In the one investment arbitration filed to date against Belgium, external counsel acted alongside internal counsel. Belgium invited bids for this work. 

Practicalities of enforcing an investment treaty claim against this country

15. Has the country signed and ratified the Washington Convention on the Settlement of Investment Disputes between States and Nationals of Other States (1965)? Please identify any legislation implementing the Washington Convention.

Belgium

Washington Convention implementing legislation

Belgium: Loi du 17 juillet 1970 portant approbation à la Convention pour le règlement des différends aux investissements entre Etats et ressortissants d’autres Etats, Washington 18 mars 1965.

16. Has the country signed and ratified the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards (1958) (the New York Convention)? Please identify any legislation implementing the New York Convention.

Belgium

New York Convention implementing legislation

Belgium: Loi du 5 juin 1975 contenant approbation de la Convention pour la reconnaissance et l'exécution des sentences arbitrales étrangères, faite à New York, le 10 juin 1958, M.B., 15 novembre 1975.

 

17. Does the country have legislation governing non-ICSID investment arbitrations seated within its territory?

Belgium

Legislation governing non-ICSID arbitrations

Belgium has recently adopted a new arbitration law based on the UNCITRAL Model Law.69 Pursuant to the law, no distinction is made between domestic and international arbitration; the law can apply to investment arbitrations, as well.

 

69  The new Arbitration Law was published in the Moniteur belge/Belgische Staatsblad on 28 June 2013 and came into force on 1 September 2013.

18. Does the state have a history of voluntary compliance with adverse investment treaty awards; or have additional proceedings been necessary to enforce these against the state?

Belgium

Compliance with adverse awards

No publicly available awards have been rendered against Belgium under the BLEU’s investment treaties.

19. Describe the national government’s attitude towards investment treaty arbitration

Belgium

Attitude of government towards investment treaty arbitration

The attitude of the government of Belgium towards investment arbitration is very favourable, as is evidenced by the large number of BITs it has concluded.

20. To what extent have local courts been supportive and respectful of investment treaty arbitration, including the enforcement of awards?

Belgium

Attitude of local courts towards investment treaty arbitration

No publicly available awards have been rendered against Belgium under the BLEU’s investment treaties, although it can be anticipated that the local courts will adopt a pro-arbitration view, as they have done in the commercial context.

National legislation protecting inward investments

21. Is there any national legislation that protects inward foreign investment enacted in this country? Describe the content.

Belgium

No.

National legislation protecting outgoing foreign investment

22. Does the country have an investment guarantee scheme or offer political risk insurance that protects local investors when investing abroad? If so, what are the qualifying criteria, substantive protections provided and the means by which an investor can invoke the protections?

Belgium

Relevant guarantee scheme

Qualifying criteria, substantive protections provided and practical considerations

Multilateral Investment Guarantee Agency

Belgium became a member of the Multilateral Investment Guarantee Agency (MIGA) on 18 September 1992. Under the MIGA, nationals and corporations from Belgium may acquire political risk insurance. This protection is available for medium- and long-term financially viable investments that comply with MIGA’s Policy on Social and Environmental Sustainability and anti-corruption standards.

Export Credit Agency

Belgium has a State-funded Export Credit Agency, which acts as the public credit insurer. The Agency insures companies and banks against political and commercial risks relating to international commercial transactions, mainly regarding capital goods and industrial projects, as well as contracted works and services. For these risks, the Agency can also work alongside banks through risk-sharing schemes. The Agency also insures against political risks relating to foreign direct investments and directly finances commercial transactions of limited proportion.

Awards

23. Please provide a list of any available arbitration awards or cases initiated involving this country’s investment treaties.

Belgium

Concluded Proceedings

Antoine Goetz et consorts v République du Burundi, ICSID Case No. ARB/95/3.

Antoine Goetz & Others and S.A. Affinage des Metaux v Republic of Burundi, ICSID Case No. ARB/01/2.

Camuzzi International S.A. v Argentine Republic, ICSID Case No. ARB/03/7.

Desarrollos en Salud S.A. s/Concurso Preventivo s/Incidente de Revisión (N.V. NISSHO IWAI S.A. (BENELUX)), Juzgado Comercial No. 26 Secretaría No. 51, Argentina.

European Media Ventures SA v The Czech Republic, UNCITRAL.

EDF International S.A., SAUR International S.A. and León Participaciones Argentinas S.A. Argentine Republic, ICSID Case No. ARB/03/23

Jan de Nul N.V. and Dredging International N.V. v Arab Republic of Egypt, ICSID Case No. ARB/04/13.

Peter De Sutter, Kristof De Sutter, DS 2 S.A. and Polo Garments Majunga S.A.R.L. v. Republic of Madagascar, Cour d’appel de Paris, Judgment of 15 March 2016.

Philippe Gruslin v Malaysia, ICSID Case No. ARB/99/3.

Piero Foresti, Laura de Carli & Others v The Republic of South Africa, ICSID Case No. ARB(AF)/07/01.

Ping An Life Insurance Company of China, Limited and Ping An Insurance (Group) Company of China, Limited v Kingdom of Belgium, ICSID Case No. ARB/12/29.

Vladimir Berschader and Moïse Berschander v The Russian Federation, SCC Case No. 080/2004.

Pending Proceedings

LSF-KEB Holdings SCA and others v Republic of Korea, ICSID Case No. ARB/12/37.

Lieven J. van Riet, Chantal C. van Riet and Christopher van Riet v. Republic of Croatia, ICSID Case No. ARB/13/12 

Reading List

24. Please provide a list of any articles or books that discuss this country’s investment treaties.

Belgium

Smets, Paul, La pratique Belge en matière de protection bilatérale des investissements privés étrangers, RBDI, 1973, pp. 28.

Dubuisson, François, Les accords internationaux relatifs à la protection des investissements et le droit d’auteur, RBDI, 1998/2, pp. 451.

Groupe de Recherche sur les acteurs internationaux et leurs discours, Etude exploratoire : Les accords bilatéraux sur l’investissement dans l’UEBL, Rapport Intérimaire, Mai 2002 (Direction : Prof. C. Gobin), Université Libre de Bruxelles Institut de Sociologie. 

Get unlimited access to all Global Arbitration Review content