Gary Born's separate opinion in the Philip Morris v. Uruguay award (see Annex B) is referred to as a "concurring and dissenting opinion," but I'm going to focus on the dissent part. Read his whole opinion, of course, but a good summary comes early on (Investment Arbitration Reporter subscribers can read Jarrod Hepburn's summary here):
4. First, this Opinion is directed towards a highly unusual aspect of the Uruguayan legal system, which produced a result in this case that has never previously occurred under Uruguayan law. As discussed below, two of the country’s highest civil courts reached directly contradictory interpretations of precisely the same statutory provision, in closely-related proceedings involving claims by the same party against the government, with these contradictory interpretations then being applied, in each case, to deny that party relief. Moreover, that same party was then left with no judicial forum in which to assert otherwise available constitutional challenges to the relevant statutory provision, as it had been authoritatively interpreted and applied to that party. In my view, that unprecedented result plainly constituted a denial of justice under Article 3(2) of the BIT and basic principles of international law.
5. Second, this Opinion is directed towards an equally unusual aspect of Uruguay’s regulatory regime for tobacco – namely, a “single presentation requirement” that permits only a single presentation of any trademark used in marketing tobacco products. It is undisputed that no other country in the world has adopted such a requirement, which is also neither required nor contemplated by the comprehensive international regulatory regime for tobacco products. In my view, given the factual background against which it was adopted and the evidentiary record in these proceedings, this unprecedented requirement is manifestly arbitrary and disproportionate and, as a consequence, constituted a denial of fair and equitable treatment under Article 3(2) of the BIT and international law.
One thing that struck me about his reasoning is that, as far as I could tell, the same result could have been reached under various reformed FET language that has been put out there in recent years. Take, for example, the FET provision proposed by the EU in the TTIP (also in CETA):
Treatment of Investors and of covered investments
1. Each Party shall accord in its territory to covered investments of the other Party and investors with respect to their covered investments fair and equitable treatment and full protection and security in accordance with paragraphs 2 to 5.
2. A Party breaches the obligation of fair and equitable treatment referenced in paragraph 1 where a measure or a series of measures constitutes:
(a) denial of justice in criminal, civil or administrative proceedings; or
(b) fundamental breach of due process, including a fundamental breach of transparency and obstacles to effective access to justice, in judicial and administrative proceedings; or
(c) manifest arbitrariness; or
(d) targeted discrimination on manifestly wrongful grounds, such as gender, race or religious belief; or
(e) harassment, coercion, abuse of power or similar bad faith conduct; or
(f) a breach of any further elements of the fair and equitable treatment obligation adopted by the Parties in accordance with paragraph 3 of this Article.
Many government officials talk about the need to reform the substance of international investment law to ensure domestic "policy space," "regulatory autonomy," "sovereignty," etc. I can imagine that some of them are heartened by the result in the Philip Morris v. Uruguay award, taking it to mean that domestic regulation is now safe. But there is a question of how much certainty you need on this. Some people may take this award to mean that the system is fine as is. However, based on the dissent, I think you could also conclude that there is a widely held view that tribunals should hold governments to a pretty strict standard with regard to their domestic policy-making, one that governments often do not meet.