6 Absolute Standards of Treatment: Fair and Equitable Treatment, Full Protection and Security

Subject(s):

Intellectual property — International investment law — Fair and equitable treatment standard — Full protection and security

This chapter assesses the absolute standards of treatment, focusing on the multifaceted fair and equitable treatment (FET) standard and the related concept of full protection and security (FPS). After considering trends in state and arbitral practice with regard to FET and FPS, it investigates how these investment standards apply to intellectual property (IP) rights as protected investments. The FET standard has developed into a multitude of elements or factors—such as the protection of legitimate expectations, stability, proportionality, transparency, as well as prohibitions of denial of justice, arbitrariness, and unjustified discrimination—many of which have been considered in the IP-related investor–state dispute settlement (ISDS) Awards issued so far. The FPS standard on the other hand bears a specifically close relation to IP enforcement standards, such as those set out in Part III (Articles 41–61) of the TRIPS Agreement. The chapter then looks at the crucial issue of balancing investor protection with the state’s right to regulate—another aspect that was at the forefront of some of the so far existing IP ISDS cases.