MONTENEGRO RECAP: THE STANDARD OF FAIR AND EQUITABLE TREATMENT (FET) AS A CATALYST FOR INVESTMENT DISPUTES

The fair and equitable treatment (FET) standard stands for one of the most significant yet debated principles in safeguarding foreign investments. While its wording is often broad and vague, its definition often emerges through arbitral awards based on the particulars of each case. This paper analyses the FET clauses in Montenegro’s Bilateral Investment Treaties (BITs) within the context of its EU accession and modern approaches to FET regulation. By examining Montenegrin BITs and reviewing past disputes, the paper explores key aspects of FET application in Montenegro’s Investor State Dispute Settlement (ISDS) practice so far. Given that the FET standard has been a central issue in nearly all disputes against Montenegro, the analysis underscores the need to review and refine FET regulation in Montenegrin BITs, in order to ensure better protection for foreign investments and clarify which state actions violate FET. Furthermore, the paper compares Montenegro’s FET clauses with those in EU practice, offering recommendations for aligning it with more robust frameworks.