Fiona Beveridge
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The challenges of free trade
Issues arising from the treatment and taxation of foreign investment in the EU and NAFTA
in The treatment and taxation of foreign investment under international law
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This chapter illustrates some of the challenges which the pursuit of a 'free trade' goal raises for traditional international economic law in relation to the treatment and taxation of foreign investment. It considers two free trade areas in particular, the EU and NAFTA, the two in which the subjugation of state interests to supranational institutions and laws is greatest. As far as investment is concerned, NAFTA follows the general approach of BITs; however, it goes further than the current generation of BITs in its identification of potential problems faced by foreign investment. Litigation has been less important as a means of clarifying the scope of the obligations under NAFTA than in the EC to date, but there are some important recent cases. The chapter also addresses a number of issues concerning dispute resolution mechanisms.

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