The states. The OECD estimates that 93%

The conclusion of thefirst BIT between Germany and Pakistan in 1959 marked an important shift in theregulation of international investment1. Underthe early BITs investors remained dependent upon their home states to espousetheir claims under state-state arbitration. By the 1990s ISDS had developed intoa standard provision in modern investment agreements2. ISDSprovided investors, for the first time, with the chance to enforce their rightsunder an investment agreement directly before an international arbitrationtribunal.

Notably, investment protection under a BIT is not limited in time orscope to a particular investment project. It constitutes, instead, a standingoffer to any eligible investor to pursue its rights with regards to any investmentthat falls within the scope of the agreement. Consent of the state-party toarbitration is implied in the BIT, and all that the investor has to do is toaccept the offer by initiating the claim3.  In other words, once the state has decided toinclude ISDS into a BIT there is nothing that can prevent an eligible investorfrom initiating an investment claim under the agreement. ISDS has advanced greatlysince its slow beginnings in the mid-20th Century. Today, both states and investorsare familiar with the system, as it has become a common tool for investors touse in order to enforce their rights against host states. The OECD estimatesthat 93% of all existing BITs contain ISDS provisions4.

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1 J. Salacuse, BIT by BIT: The Growth of Bilateral Investment Treatiesand Their Impact on Foreign Investment in Developing Countries, 24International Law 655, 659 (1990).2 Rudolf Dolzer and ChristophSchreuer, Principles of InternationalInvestment Law (Oxford University Press 2012), at pp. 6-7.

3 Ibid, Dolzer and Schreuer(2012), at p. 257.4 OECD, “Investor-State DisputeSettlement”, Public Consultation Document (2016), at 8.

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