Chapter 1 is an introduction to language analysis in the linguistic sense. It establishes the specifications of the scientific approach to language, describes uses and characteristics across different areas, and provides an overview of the domains of linguistics. This includes a review of sounds, including phonetics and phonology; structure, including morphology and syntax; and meaning, including semantics and pragmatics. Through the provision of Discover Activities that provide a scaffold for the investigation of these concepts, readers then become familiar with the analytic techniques that will be emphasized throughout the book. These techniques are finally specified and detailed as part of a broader method of investigation and hypothesis testing.

The area of international law on foreign investment is the result of an intense clash of different interests at play. Elucidation of the nature of the conflicts in the different areas of this field of law will help in understanding the issues involved.1 The historical factors which shaped the law were set out briefly in Chapter 1. This introductory chapter also indicated the changes that have taken place in the framework within which foreign investments are made. The present chapter elaborates further the legal context in which foreign investment operates.

As the number of arbitrations under the investment treaties increases and the perception of their legitimacy decreases with conflicting decisions, the adoption of expansionary techniques of interpretation increasing the jurisdiction of the tribunals, the creation of new substantive principles of liability and the award of huge sums as damages, states have responded in three principal ways.1 The first has been one of withdrawal from the system of investment arbitration.2 Some states have announced that they will consider not extending the life of their investment treaties after they expire.3 This response is a calculated decision based on the belief that the costs of arbitration and disputes outweigh the benefits that investment treaties bring to a state. Withdrawal and termination are matters of sovereign prerogative, but such a withdrawal has to be effected through the manner prescribed in the treaty.4 The effectiveness of withdrawal depends on its timing. Such withdrawal is not possible as to existing disputes or disputes that arose while the treaties were pending. The termination provisions in the treaties are relevant in determining such issues.5 Treaties could be terminated by agreement between the parties at any time.

What constitutes an act of taking of foreign property in international law was once clear but is now befuddled with difficulty due to the progressive expansion of the concept of taking. The reaction to this by states has been to curtail the expansionary trends through the revival of the rule on non-compensable regulatory takings. The response of the expansionists has been to restrict the rule through the introduction of a hitherto unused rule that requires proportionality between the object of the regulatory taking and the harm to the investor. In the past, the law was discussed in the context of outright takings of the property of the alien. There was no difficulty in characterising the act of physical dispossession and transfer of ownership as a taking.1 After colonialism came to an end, there was a spate of nationalisations intended to regain control of the economy from the companies of the erstwhile colonial powers. These involved the taking of property from the foreign multinational corporations of the former imperial power and vesting ownership of it in the state or a state-owned company.

The first bilateral investment treaty, the treaty between Pakistan and Germany, was made in 1959. The reason for the treaty was that two states, knowing that the international law on the protection of foreign investment was uncertain, made the rules certain as between themselves. Treaty activity between 1957 and 1990 was slow. There was a massive proliferation of bilateral investment treaties in the 1990s. A World Bank study stated that in 1994 there were over 700 such treaties.1 By the end of the millennium, the figure had moved towards 2,600 treaties.2 It exceeded that mark, reaching around 3,300.3 There has been a decrease in numbers since then, due to termination of treaties by many states. UNCTAD states that the number of treaties now is around 2,896.4 There are 390 free trade agreements and other treaties with investment provisions. There are now mega-treaties like the Trans Pacific Partnership (TPP),5 which contain chapters on investment. The Regional Comprehensive Economic Partnership was negotiated in 2020, though it has not been ratified. It includes the ten ASEAN states and China, India, Australia, New Zealand, Japan and Korea.