Consolidating the Investment Policy through the most favored Nation Clause in International Investment Agreements

Abstract

The most favored nation clause has attracted much attention in the international investment regime in the past years. The debate has been centered on whether such regulation allows the attraction of more favorable conditions regarding the resolution of controversies. This paper moves away from this debate to analyze another problem that has gained much less attention: the possibility that, through the mentioned clause, more favorable conditions are attracted and included in previously signed treaties. This possibility is of great interest since it could hinder the modification of the investment attraction policies of the States as expressed in their investment treaties. If eventual shifts in the development strategy are desirable, the clause constitutes an obstacle that should be thoroughly examined.