Bilateral Investment Treaty

Bilateral Investment Treaty (BIT) and the GATT Policy Negotiations

In relation to the GATT Policy Negotiations, Christopher Mark (1993) provided the following explanation and/or definition of Bilateral Investment Treaty (BIT): An agreement between two countries providing for nondiscriminatory treatment of direct investments. A BIT usually contains provisions for prompt and adequate compensation in the event of expropriation; guarantees on free transfers of investment earnings; freedom from performance requirements; and mechanisms for resolving disputes such as third-party arbitration. As of September 1993, the United States had signed 25 BITs –13 of which had entered into force –with another 20 under discussion with foreign countries.