Due diligence is present in a variety of aspects of the protection of foreign investors in international investment law and plays an important role in several aspects of the protection of foreign investors. In particular, certain standards of investment protection, notably "full protection and security" ("FPS") include an obligation for the State to act with due diligence.
This articles seeks to establish an explanatory framework for past and future decisions of arbitral tribunals which have applied or will be confronted to applications of the due diligence standard in international investment law, by providing a typology of the different possible applications of the standard in relation to the obligations of the host State. It addresses the role of due diligence in the law governing State responsibility, and the application of due diligence in the customary norms relating to the protection of aliens. Based on these two sections, it next discusses the principle in contemporary investment law, focusing on the application of due diligence in the FPS, the international minimum standard ("IMS") and the fair and equitable treatment ("FET") standards of treatment. It then addresses the question of whether applying due diligence allows for the possibility of taking into account the relative capacities of host States, and the consequences the application of the due diligence standard has on the compensation for damages.
De Brabandere, Eric
"Host States' Due Diligence Obligations in International Investment Law,"
Syracuse Journal of International Law and Commerce:
2, Article 4.
Available at: http://surface.syr.edu/jilc/vol42/iss2/4