Uzbekistan's New Bilateral Investment Treaty Standpoint: In Case of Uzbekistan-Turkey bit (2018) by F. Muminov and J. Górski About tdm tdm


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Uzbekistan s New Bilateral Investment Tr

Metal Tech vs Uzbekistan ruled that, as a result of 
corruption linked to the establishment of the claimant’s investment in Uzbekistan, the 
investment has not been “implemented in accordance with the laws and regulations of the 
Contracting Party in whose territory the investment is made” as required by art 1(1) of the 
BIT.”
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Similarly, in 
Spentex vs Uzbekistan,
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the tribunal decided in favor of Uzbekistan because of 
bribery allegations. Although the award has not been made public, details of the case and 
tribunal findings have been profusely discussed in professional literature. Reportedly, the 
tribunal found red flags suggesting corruption in the shadow of certain consultant fees for 
public tender
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. In addition, the tribunal in this case also pondered on whether bribery should 
have an impact on the jurisdiction of the tribunal, or the admissibility of the investor’s claim. 
Uzbekistan argued that, for the claim to be admissible, investment required to be established 
“in accordance with the host state law” based on art 2 of Netherlands-Uzbekistan BIT. The 
tribunal concluded in this regard that: 
 “if a finding of corruption routinely leads to the dismissal of the claimant’s claim, 
corrupt investor is punished for their conduct, while corrupt host states are left off 
the hook.”
 “Corruption in the making of an investment established a core violation of the 
principle of good faith and a violation of international public order and the claimant 
who comes with “unclean hands” to a tribunal should be heard.
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Mytilineos Holdings SA vs The State Union of Serbia & Montenegro and Republic of Serbia, PCA, Partly Award 
on Jurisdiction, para.140. 
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Tokios Tokeles vs Ukraine, ICSID Case No. ARB/02/18, Decision on Jurisdiction, paras 74-76. 
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Metal-Tech Ltd. vs Republic of Uzbekistan, ICSID Case No. ARB/10/3. 
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 Spentex Netherlands v. Uzbekistan (Case ARB/13/26) ICSID Award (2016). This case is not published yet. 
See 
a brief review of the case: Kathrin Betz ‘
Proving Bribery, Fraud and Money Laundering in International 
Arbitration: On Applicable Criminal Law and Evidence’ (2017) CUP, 128.
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Greenwald, K. Brody and Ivers Jennifer A ‘
Addressing Corruption Allegations in International Arbitration’ 
(BRILL 2019), 44.
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Spentex Netherlands v. Uzbekistan, para 819. It is interesting that tribunal suggested for the future similar cases 
in BITs: “On one hand, the claimant cannot have its claim entertained (due to a lack of either jurisdiction or 
admissibility). On other hand, a tribunal should be able to entertain the claim as if no corruption had occurred and, 
in case it finds the State liable, calculate damages that a claimant having made investment without resort to corrupt 
would have been entitled to and then order that such amount be transferred not to the claimant, but to an 
appropriate body of the UN and the OECD, or any other body fighting against corruption”. 



2.2. Non-discrimination Clauses 
The non-discrimination clause includes national treatment standard (NT) and most-favored 
nation standard (MFN) imply that the host state shall not treat foreign investors less favorably 
than its own investor (NT) and investors of any third state (MFN). In principle, NT means that 
foreign investors are subject to the same rules and procedures as domestic investors. Art 4 (1) 
of the Uzbekistan-Turkey BIT contains a non-discrimination clause that defines the scope of 
national treatment: 
“Each Contracting Party shall accord to these investments, once established, treatment 
no less favorable than that accorded in like circumstances to investments of its investors 
or to investors to investment of investors of any third State, whichever, is the most 
favorable, as regards the management, maintenance, use, operation, enjoyment, 
extension, sale, liquidation or disposal of investment.” 
Foremost, it is clear that the non-discrimination clause is only applicable after the investment 
has been established. Nowadays, the notion of 

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