{"id":3827,"date":"2016-08-10T09:41:56","date_gmt":"2016-08-10T14:41:56","guid":{"rendered":"http:\/\/itn.mattrock.ca\/?p=3827"},"modified":"2024-08-09T18:27:10","modified_gmt":"2024-08-09T16:27:10","slug":"india-takes-steps-to-reform-its-investment-policy-framework-after-approving-new-model-bit","status":"publish","type":"post","link":"https:\/\/www.iisd.org\/itn\/2016\/08\/10\/india-takes-steps-to-reform-its-investment-policy-framework-after-approving-new-model-bit\/","title":{"rendered":"India takes steps to reform its investment policy framework after approving new model BIT"},"content":{"rendered":"<p>India has started to send official\u00a0<a href=\"http:\/\/thewire.in\/52022\/remodeling-indias-investment-treaty-regime\/\">notices to terminate<\/a>\u00a0bilateral investment treaties (BITs) to 57 partner countries with which it has BITs that have already expired or will expire in the near future.<\/p>\n<p>Moreover, to the 25 countries with which India has BITs with initial durations expiring from July 2017 onward, India has started to propose\u00a0<a href=\"http:\/\/www.madhyam.org.in\/remodeling-indias-investment-treaty-regime-ii\/\">signing joint interpretative statements<\/a>\u00a0to clarify ambiguities in treaty texts, for example, with respect to the definitions of investor and investment and the exclusion of taxation matters.<\/p>\n<p>These bold steps follow the approval of\u00a0<a href=\"http:\/\/finmin.nic.in\/the_ministry\/dept_eco_affairs\/investment_division\/ModelBIT_Annex.pdf\">India\u2019s new model <span class='tooltipsall tooltipsincontent classtoolTips63'>BIT<\/span><\/a>\u00a0in December 2015, which narrows the scope of the standard of treatment of investors (avoiding the term \u201cfair and equitable treatment\u201d), leaves out the <span class='tooltipsall tooltipsincontent classtoolTips75'>MFN<\/span> clause and includes investor obligations. While retaining investor\u2013state arbitration, the model requires investors to exhaust local remedies before commencing international arbitration against the host state.<\/p>\n<p>India\u2019s foreign investment policy has shifted in response to an increased number of challenges to government measures and policies by foreign investors under investment treaties:\u00a0<a href=\"http:\/\/investmentpolicyhub.unctad.org\/ISDS\/CountryCases\/96?partyRole=2\">seven arbitration cases<\/a>\u00a0are known to have been initiated against India since 2012.<\/p>\n<p>Renegotiating investment treaties pursuant to the new model and embedding its revised policy in ongoing trade and investment negotiations\u2014with partners such as Canada, European Union and the United States, and in the context of <span class='tooltipsall tooltipsincontent classtoolTips35'>RCEP<\/span>\u2014will be India\u2019s next political challenge.<\/p>\n<p>A despondent\u00a0<a href=\"http:\/\/bigstory.ap.org\/article\/8d659574fe3840daaf0144b930057dcf\/india-wants-new-foreign-investment-pacts-limit-lawsuits\">letter<\/a>\u00a0sent on May 25, 2016 by <span class='tooltipsall tooltipsincontent classtoolTips117'>EU<\/span> Trade Commissioner Cecilia Malmstr\u00f6m to India\u2019s commerce and finance ministers illustrates the challenge. She warned that India\u2019s notices of termination to \u201ca significant number\u201d of EU member states could \u201chave serious consequences\u201d if replacement treaties are not in place. According to her, it could \u201ccreate a gap in investment protection and consequently discourage EU enterprises from further investing in India,\u201d as investors \u201cmay perceive the investment climate as deteriorating.\u201d<\/p>\n<p><em><a href=\"https:\/\/www.iisd.org\/itn\/2016\/08\/10\/news-in-brief-24\/\">More News in Brief<\/a><\/em><!--more--><\/p>\n<script type=\"text\/javascript\"> toolTips('.classtoolTips7','United Nations Conference on Trade and Development'); <\/script><script type=\"text\/javascript\"> toolTips('.classtoolTips8','Conferencia de las Naciones Unidas sobre Comercio y Desarrollo'); <\/script><script type=\"text\/javascript\"> toolTips('.classtoolTips32','International Institute for Sustainable Development<!--more-->'); <\/script><script type=\"text\/javascript\"> toolTips('.classtoolTips33','Institut international du d\u00e9veloppement durable'); <\/script><script type=\"text\/javascript\"> toolTips('.classtoolTips34','Instituto Internacional para el Desarrollo Sostenible'); <\/script><script type=\"text\/javascript\"> toolTips('.classtoolTips35','Regional Comprehensive Economic Partnership<!--more-->'); <\/script><script type=\"text\/javascript\"> toolTips('.classtoolTips36','Partenariat \u00e9conomique r\u00e9gional global'); <\/script><script type=\"text\/javascript\"> toolTips('.classtoolTips37','Asociaci\u00f3n Econ\u00f3mica Integral Regional'); <\/script><script type=\"text\/javascript\"> toolTips('.classtoolTips43','investor\u2013state dispute settlement'); <\/script><script type=\"text\/javascript\"> toolTips('.classtoolTips58','soluci\u00f3n de controversias inversionista-Estado'); <\/script><script type=\"text\/javascript\"> toolTips('.classtoolTips60','Investment Treaty News'); <\/script><script type=\"text\/javascript\"> toolTips('.classtoolTips63','Bilateral investment treaty'); <\/script><script type=\"text\/javascript\"> toolTips('.classtoolTips67','Energy Charter Treaty'); <\/script><script type=\"text\/javascript\"> toolTips('.classtoolTips75','most-favoured nation'); <\/script><script type=\"text\/javascript\"> toolTips('.classtoolTips106','asociaci\u00f3n p\u00fablica-privada'); <\/script><script type=\"text\/javascript\"> toolTips('.classtoolTips114','Sistema de Tribunales de Inversiones'); <\/script><script type=\"text\/javascript\"> toolTips('.classtoolTips116','European Commission'); <\/script><script type=\"text\/javascript\"> toolTips('.classtoolTips117','European Union'); <\/script><script type=\"text\/javascript\"> toolTips('.classtoolTips118','Union europ\u00e9enne'); <\/script><script type=\"text\/javascript\"> toolTips('.classtoolTips119','Uni\u00f3n Europea'); <\/script>","protected":false},"excerpt":{"rendered":"<p>India has started to send official\u00a0notices to terminate\u00a0bilateral investment treaties (BITs) to 57 partner countries with which it has BITs that have already expired or will expire in the near [&hellip;]<script type=\"text\/javascript\"> toolTips('.classtoolTips63','Bilateral investment treaty'); <\/script><\/p>\n","protected":false},"author":1,"featured_media":15869,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[397],"tags":[1932,1948,1984,1951,1978,2084,1942],"class_list":["post-3827","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","tag-bits","tag-eu-bits","tag-fair-and-equitable-treatment-fet","tag-india","tag-investor-obligations","tag-local-remedies","tag-model-bit"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.iisd.org\/itn\/wp-json\/wp\/v2\/posts\/3827","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.iisd.org\/itn\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.iisd.org\/itn\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.iisd.org\/itn\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.iisd.org\/itn\/wp-json\/wp\/v2\/comments?post=3827"}],"version-history":[{"count":0,"href":"https:\/\/www.iisd.org\/itn\/wp-json\/wp\/v2\/posts\/3827\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.iisd.org\/itn\/wp-json\/wp\/v2\/media\/15869"}],"wp:attachment":[{"href":"https:\/\/www.iisd.org\/itn\/wp-json\/wp\/v2\/media?parent=3827"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.iisd.org\/itn\/wp-json\/wp\/v2\/categories?post=3827"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.iisd.org\/itn\/wp-json\/wp\/v2\/tags?post=3827"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}