CAFLL-WestPac Recap: BIT by BIT: Researching Chinese Bilateral Investment Treaties

By: Barbara Swatt Engstrom

China Africa News

Introduction:

Seattle University Law Professor Won Kidane is originally from Ethiopia and has a strong background in China-Africa investment relations.  In 2012, he published China-Africa Dispute Settlement: The Law, Culture and Economics of Arbitration, which evaluated existing mechanisms of dispute resolution in China-Africa economic relations.  In subsequent years, he focused on a particular institution for international investment dispute resolution: the International Centre for Settlement of Investment Disputes (ICSID).  In particular, he explored whether ICSID is an appropriate forum to handle the investment disputes stemming from an enormous increase in investment in Africa by China.  In analyzing the ICSID legitimacy debate, he created a framework to assess the suitability of ICSID arbitration for China–Africa investment dispute arbitration.  The outcome of this research project was his article: The China-Africa Factor in the Contemporary ICSID Legitimacy Debate.

As he was working on the project, Professor Kidane decided to delve more deeply into the bilateral treaties that provide the basis for the investment regime he was questioning.  He asked me to research and analyze all bilateral investment treaties (BITs) between China and African countries.

Background on Chinese BITs:

In order to do the analysis part of the project, I needed to get myself up to speed with BITs, generally, and Chinese BITs, in particular.  While BITs vary depending on the negotiating partners, countries use model BITs as starting points.  Historically, there are three generations of Chinese model BITs.  China’s first generation BITs (starting with its BIT with Sweden in 1982) are generally considered to be conservative.  They accord Most Favored Nation (MFN) status but not National Treatment (NT).  The availability of compensation for expropriation was recognized, but the legality of the expropriation was determined by local courts.  China’s second generation of BITs followed China’s accession to the ICSID convention in 1990.  In some of these BITs, the availability of investor access to ICSID arbitration was included but was often limited to the determination of the amount of compensation for expropriation.  The third and current model made both substantive and procedural changes. One of the most important substantive changes was the addition of National Treatment protection. The most important procedural change was unqualified access to international arbitration, including ICSID arbitration.

Research Strategies:

Once I had a very general understanding of Chinese BITs, I was able to much more effectively research and analyze the China Africa BITs for this project.  My main tips for researching BITs are as follows:

1) Start with the United Nations Conference on Trade and Development (UNCTAD) International Investment Agreements Navigator.  This database will give you a fairly comprehensive idea of what is generally available.  It has information on signatory and ratification dates and provides many full text treaties.

2) Use Target Countries’ International Trade Ministries. The English language page of China’s Ministry of Commerce (MOFCOM) has a database of Chinese BITs.  They had the full text of several BITs that were not available via the International Investment Agreements Navigator.

3) Use Print Materials for Older BITs. One of the very best English books for any project involving Chinese BITs is Gallagher and Shan’s Chinese Investment Treaties.  In addition to having great analysis, there are reprints of several BITs in the Appendix.  This was the only place to find the Seychelles –China BIT.  Another very useful print resource, especially for older BITs, is the looseleaf set: Investment, Promotion and Protection Treaties.  This is where I found the China-Mali BIT. Research guides can also be very helpful in pointing you to print sources, as can running searches in the Google Books database.

4) Advanced & Deep Web Searching. Searching Google for BITs can often lead to frustration for a couple of reasons: 1) A basic Google search only crawls the very top layers of websites.  It won’t find anything buried.  The solution is to go directly to the target website and use their search tool to go deeper. 2) BIT is a generic term.  Although the titles vary, BITs generally have the terms “promotion and protection of investments” in them somewhere. It will help if you have model treaty language that you can track.  I also like to use the site search in Google. The advance Google search: Tanzania promotion protection investment site:mofcom.gov.cn brought up the Tanzania-China BIT which was not available in the MOFCOM Bilateral Investment Treaty database.

5) Contact Experts. While attending the ASIL conference in Washington, D.C., I stopped by the Law Library of Congress and met with several of their country specialists.  One of the China specialists found the China-Sierra Leone BIT tucked away in the AsianLII database – a place it had not occurred to me to look.

Additional Resources:

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