Pakistan has decided to terminate 23 bilateral investment treaties (BITs) with different countries in order to avoid international arbitration with foreign firms on commercial contracts, reported Tribune.
To date, as many as 10 cases had been lodged by foreign investors in different international arbitral forums, thus exposing the state of Pakistan to billions of dollars in compensation. There are nine other bilateral investment treaties. However, those nine treaties could be terminated or reformed by engaging the respective countries bilaterally.
Pakistan mulled over an option of taking up these nine treaties with the respective states to revise them in line with its revised BIT strategy.
There are 16 other treaties which the government does not want to ratify to avoid financial exposure in case foreign firms file cases in international courts due to litigation in commercial contracts with Pakistan.
According to the Board of Investment (BOI), under Section 9(m) of the Board of Investment Ordinance 2001, the BOI is mandated to negotiate and finalise agreements for promotion and protection of investments/bilateral investment treaties with other countries. To date, Pakistan has concluded 53 BITs with 48 countries.
BIT was a primary source to define the rights and obligations of signatory states and their investors. BITs were considered as tools for attracting foreign direct investment (FDI) through the provision of investment protection and facilitation to the foreign investors
