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Umbrella clauses are highly controversial in arbitration awards because they offer foreign investors the opportunity to increase their violation of contractual investment rights to the violation of investment contracts under international law. The effect of the safeguard clauses remains controversial. Four main interpretations have been created. In SGS v. Pakistan10, the intermediate inspection contract between the applicant and Pakistan, which includes the selection of forums for Pakistani courts, was unilaterally denounced by Pakistan. However, the applicant commenced arbitration proceedings before the International Center for Settlement of Investment Disputes under the ILO between Pakistan and Switzerland. The court took a much-criticized decision and ruled that the safeguard clause in the event of a breach of contract between the parties was not effective. The court justified its decision by the fact that, while acknowledging that states can agree in an ILO that transfers all violations of the treaties of states in violation of the ILO, there is no clear or convincing evidence in this case that this was the real intention of the two states, whereas the safeguard clause, which was established in the 1950s in the 1950s , was adopted to improve the protection of investor government contracts. „1 The framework clauses provide that host Member States respect `the commitments they have made` (or,.

B“respect,“ „execution,“ „respect“ or „respect“ for compliance with commitments, or. B „commitments“ (or „commitments“ for example. B.“ Umbrella clauses apply only to companies in the host Member State and not to companies of foreign investors2. Another issue discussed with regard to the clauses made is whether or not they protect unilateral actions such as state legislation. Gazzini, T. and Tanzi, A., Handle with care: Umbrella Clauses and MFN treatment in investment arbitration, The Journal of World Investment – Trade, 2013, 978-994. In Noble Ventures in Romania20, the Tribunal held that even if the contract between the applicant and the Romanian public property fund, which is its own legal entity, is concluded, the safeguard clause of the contract applies, since the Romanian government may be held responsible for the breach of contract by a state fund. On the contrary, at Impregilo v. Pakistan21, it was concluded that the applicant could not benefit from the ILO interim clause signed between Italy and Pakistan, since the contract was not concluded directly with Pakistan, but with a separate entity, the Pakistan Water and Power Development Authority22. Mayer, P., Contract claims and jurisdictional clauses of investment protection treaties, Journal of International Law, 2009, 71-96. The first type applies only to contractual, explicit or implied obligations16 Despite the English wording of the safeguard clause of ECT17, it is generally accepted that it applies only to consensual obligations and not to general state legislation.18 Argentina13, CMS v. Argentina14 and Sempra v.

Argentina15, which had added to their argument a distinction between sovereign status and the commercial status of states. The courts have pointed out that the framework clauses in investment arbitration proceedings only cover disputes relating to investment contracts or contracts involving states as sovereigns, not as a commercial contractor16. Therefore, these decisions clarify the idea of limiting the scope of obligations under framework clauses in investment contracts, unless the state has acted within its function as a public power.