My buddy Bryan Mercurio and I were emailing about the new tobacco carveout in the amended Australia - Singapore FTA, and he suggested that this carveout may violate the fair and equitable treatment obligation. At first I thought, how would a provision in an investment chapter violate that very chapter? That doesn't make any sense! But then I started thinking like a complainant, and maybe there is a way to make the argument.
Assuming there is some foreign investor who can and would make the case (a big assumption), the argument could go something like this. The investor made its investment in Singapore/Australia on the basis of the existing legal framework, which included the right to bring ISDS cases against tobacco control measures. Suddenly, this right was taken away from them through an amendment to the FTA, and this amendment violates the fair and equitable treatment obligation in the investment chapter of that FTA. In the context of the fair and equitable treatment obligation, a number of investment tribunals have looked at whether a measure was "arbitrary." Here, the amendment is arbitrary because there is no good reason to single out tobacco control measures, which have only rarely been challenged or targeted in ISDS cases, as compared to other measures/industries. And anyway, a general exception for legitimate public policies is a non-discriminatory solution.
The TPP situation is different, of course, because the carveout was in there from the beginning. It is the act of excluding tobacco control measures later, after investments have been made at a time when ISDS was available to all, that is a particular problem.
That's the short version of the argument. I'll let the high-priced attorneys who bring these cases flesh out the details.
One final point. I'm not sure if the amendment to the Australia - Singapore FTA has to be implemented in domestic law. If so, that domestic implementation act could be the measure challenged. But if not, the government behavior at issue could be the act of amending the existing FTA.
