Весьма актуальная публикация посвящена инвестиционным договорам Украины. В центре внимания — двусторонние инвестиционные договоры (ДИД). Особенное внимание уделяется вопросам, связанным с инвестиционными спорами, конфиденциальностью в инвестиционном арбитраже и страхованием инвестиций.
Investment treaty practice
Does the state have a model BIT?
Does the state have a central repository of treaty preparatory materials? Are such materials publicly available?
Under the Order of the State Committee On Archives of Ukraine and the Ministry of Foreign Affairs on approval of the Regulations of the State Departmental Archive of the Ministry of Foreign Affairs of Ukraine (No. 59/78, dated 17 April 2006, as amended), materials created in the course of the activity of the Ministry of Foreign Affairs, including the originals of international treaties and materials related to them, are located in the State Departmental Archive of the Ministry of Foreign Affairs. It provides copies of documents for a fee.
Scope and coverage
What is the typical scope of coverage of investment treaties?
Pursuant to Ukrainian investment treaties, the investor may be an individual or legal entity. In respect of individuals, Ukrainian investment treaties normally define an ‘investor’ as a citizen or national of a contracting party. Permanent residents are not usually included in the definition of ‘investor’. However, under four BITs (with Azerbaijan, Canada, Israel and Kazakhstan), the ECT and Commonwealth of Independent States Treaty (CIS Treaty), protection is provided to citizens or nationals and permanent residents of a contracting party.
While most Ukrainian investment treaties provide that a juridical person incorporated or duly organised according to the laws of a contracting party is an ‘investor’, certain BITs contain additional requirements as to the territory of a contracting party:
14 BITs (with Argentina, Austria, Bulgaria, Cuba, Germany, India, Lithuania, Macedonia, Mongolia, Morocco, Oman, Serbia, Slovenia, Tajikistan and Turkmenistan) require that such entities have their seat in the territory of a contracting party;
five BITs (with Chile, Iran, Jordan, Poland and Switzerland) require that such entities have their seat and business activity in the territory of a contracting party;
four BITs (with Portugal, Saudi Arabia, Slovakia and Turkey) require that such entities have their main office or headquarters in the territory of a contracting party;
the France and Lebanon BITs require that such entities have their legal address in the territory of a contracting party;
the Finland BIT requires that such entities have their registered office in the territory of a contracting party; and
the Bosnia and Herzegovina BIT requires that such entities have their registered seat, central office or main business activity in the territory of a contracting party.
Most Ukrainian BITs contain no exclusion of certain assets from the definition of ‘investment’. However, the Canada BIT does not protect real estate or other property not acquired in the expectation or used for the purpose of economic benefit or other business purposes. The Israel BIT does not protect the operations of obtaining loans, credit facilities and reimbursable financial assistance by the investor.
Most Ukrainian investment treaties explicitly require investments to be made in accordance with the contracting party’s laws.
What substantive protections are typically available?
Ukrainian investment treaties typically prescribe:
protection from expropriation;
fair and equitable treatment;
full protection and security;
an umbrella clause; and
a most-favoured-nation clause.
All Ukrainian investment treaties provide for protection against unlawful expropriation. In addition, 13 investment treaties expressly protect against direct as well as indirect expropriation (Brunei, Chile, Finland, France, Iran, Jordan, Kuwait, Lebanon, Netherlands, Poland, Turkey, United Arab Emirates and United States BITs). Half of the BITs expressly provide protection to investors owning shares in the expropriated company. Only the CIS Treaty and four Ukrainian BITs (with Armenia, Azerbaijan, Russia and Turkey) do not contain the fair and equitable treatment standard. While most investment treaties simply stipulate that each contracting party shall ensure fair and equitable treatment to investments, only the France BIT is more prescriptive. It stipulates that limits imposed on the purchase or transportation for production of raw materials or supporting materials, fuel and energy shall be considered as a breach of fair and equitable treatment.
The formulation of the obligation to provide ‘protection and security’ in Ukrainian investment treaties is not uniform. Most investment treaties simply indicate that each contracting party shall grant ‘full protection and security’ to investments. Some provide for ‘full protection’ (eg, the Austria BIT), or ‘full and unconditional protection’ (eg, the CIS Treaty). Four Ukrainian BITs (Armenia, Azerbaijan, India and Turkey) do not provide for ‘protection and security’ as standard.
Twenty-four Ukrainian investment treaties contain an umbrella clause (ECT, and the Albania, Austria, Azerbaijan, Denmark, Egypt, Finland, Germany, Japan, Jordan, Korea, Kuwait, Lebanon, Mongolia, Morocco, Netherlands, Panama, Singapore, Spain, Switzerland, United Kingdom, United States, Uzbekistan and Vietnam BITs). All Ukrainian BITs explicitly provide that the provision of most-favoured nation or national treatment does not extend to the benefits of membership of a customs union, monetary union or free trade area.
In addition, all Ukrainian investment treaties contain a provision that requires the contracting parties to permit investors to freely transfer investments and investment returns. All BITs (except the United States BIT) provide for the right of the host state to subrogation.
What are the most commonly used dispute resolution options for investment disputes between foreign investors and your state?
Most Ukrainian investment treaties provide a right of recourse to ICSID and an ad hoc tribunal constituted in accordance with the United Nations Commission on International Trade Law (UNCITRAL) Arbitration Rules.
Some treaties also allow investors to pursue an arbitration claim through:
the International Court of Arbitration of the International Chamber of Commerce (Bosnia and Herzegovina, Jordan and United Kingdom BITs, as well as the Turkey BIT, but only in case the dispute was first submitted for resolution to the national courts of a disputing party and was not resolved within a year);
the Arbitration Institute of the Stockholm Chamber of Commerce (Russia BIT and the Energy Charter Treaty);
an ad hoc tribunal under the rules specifically provided in the BIT with different appointing authorities (the Armenia, Brunei, China, Cuba, Germany, Libya, Poland and United Arab Emirates BITs); or
any other tribunal acting in accordance with any other arbitration rules as is mutually agreed by the parties (the Kuwait, Japan, Mongolia, United Arab Emirates, United Kingdom and United States BITs).
Does the state have an established practice of requiring confidentiality in investment arbitration?
The awards in investment arbitrations involving Ukraine are usually public. The only confidential awards are the awards in Remington Worldwide Limited v Ukraine and in JKX Oil & Gas, et al v Ukraine. The settlement agreements in Laskaridis Shipping v Ukraine and Western NIS Enterprise Fund v Ukraine are also not public.
The recently rendered awards in ICSID cases Krederi Ltd v Ukraine and City-State NV, et al v Ukraine have also not been made public.
Does the state have an investment insurance agency or programme?
On 20 December 2016, the Ukrainian Parliament adopted the Law of Ukraine On Ensuring the Large-Scale Expansion of the Export of Goods (Works, Services) of Ukrainian Origin through Insurance, Guaranteeing and Cheapening of Export Crediting No. 1792-VIII. According to this Law, the Cabinet of Ministers of Ukraine is empowered to institute the Export-Credit Agency that, among other functions, will provide insurance and reinsurance of direct investments from Ukraine limited to investments into the infrastructure required for the development of the export of goods, works and services of Ukrainian origin. According to the Resolution of Cabinet of Ministers of Ukraine No. 65, dated 7 February 2018, the Export-Credit Agency was established as a form of private joint-stock company.
Law No. 1792-VIII does not contain specific rules on the contingency of the investment insurance on the availability of an investment treaty between the state and the host state (target of the investment). At the same time, according to this Law, the Export-Credit Agency shall be responsible for performance of functions, securing financial obligations and implementation of rights under the bilateral investment treaties of Ukraine and multilateral treaties.
Авторы: Olesia Gontar, Tatyana Slipachuk