The Boundaries of Most Favored Nation Treatment Clause (Especially on Dispute Settlement Agreement)

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Beykent Üniversitesi

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The aim of this paper is to examine Most Favored Nation Clause (MFN) existing in the Bilateral Investment Treaties (BITs) to which Turkey is a signatory, from a historical and conceptual perspective; to determine the general boundaries of the application of this clause according the jurisprudence of the international arbitration organs and lastly to point out the important awards that affects its applicability to Dispute Settlement Agreement in Bilateral Investment Agreements. With the aim of preventing discrimination against the nationals of different countries and ascertain equality of treatment regardless of nationality, today, MFN Clauses exist in different types of Model BITs as in the example of German, UK, US, Netherlands, Canadian Model. The restriction of MFN clause which is not directly related with dispute settlement bases on two principals called “temporality” and “erusdem generis” which are stated in Rights of Nationals by the United States of America in Morocco and The Ambatielos Case respectively. Maffezini Case and Siemens vs Argentina Case are in favor of the applicability of The MFN Clause to dispute settlement. However Salini Case and Plama Case have the principal to find the real intention of the parties for the application of the Clause.


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Most Favoured Nation Clause, Dispute Settlement, Bilateral Investment Treaties, Arbitration


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Beykent Üniversitesi Hukuk Fakültesi Dergisi 1/1 (2015), 211-219