“UMBRELLA CLAUSES” AS GUARANTEES OF THE RIGHT OF FOREIGN INVESTORS AND A MECHANISM FOR PROTECTING FOREIGN INVESTMENTS

Povzetek

The article analyzes international legal guarantees of foreign investors' rights, which can be classified as special in relation to general international legal guarantees, since they have a special subject of regulation ‑ the obligations of states that accept foreign investments. International legal guarantees of foreign investors' rights, being special, are contained in international multilateral and bilateral agreements and include guarantees of foreign investors' property rights, compensation, insurance, guarantees of resolution of international investment disputes, but at the same time, these guarantees are aimed at ensuring the protection of foreign investors' property rights. One such guarantee of an international legal nature is the reservations contained in bilateral investment agreements, which in international law doctrine are referred to as “umbrella” reservations. These clauses are provisions under which the host state undertakes to comply with any obligations to the foreign investor in relation to investments, including contractual obligations. An umbrella clause allows a breach of obligations under a private law contract to be interpreted as a breach of an investment agreement, and despite its prevalence in both bilateral investment agreements and arbitration awards, many questions regarding the nature and application of umbrella clauses remain unanswered.