Investitionsschutz und Geschäftsgrundlage

Various national legal orders provide for a fundamental change of circumstances, as does public international law in Art. 62 of the VCLT. However, can a host state invoke Art. 62 of the VCLT against a foreign investor to justify new legislation during an economic crisis? Is the VCLT’s rule applicable against a private individual or product? This thesis examines the field in which public international law and private law intersect, unravelling the different issues underlying this question. In an abstract theoretical analysis, it finds that Art. 62 of the VCLT is also applicable in a mixed arbitration. Consequently, its concrete application to the cases filed against Spain’s withdrawal from solar power promotion demonstrates that Art. 62 of the VCLT is in fact the more appropriate solution, as opposed to state necessity or the FET standard. Modern treaty practice supports this conclusion, as new investment treaties increasingly provide for a fundamental change of circumstances in their terms.