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Jan Kunstyr, Legal Director and a key part of Sherrards’ Arbitration Unit, has produced a deep-dive on the UK’s progress on investment treaty protection in a post-Brexit world.
As a Czech and EU citizen living in the UK, I cannot say Brexit made my life easier. It also left Britain with more work to do. In investment protection, the UK gained greater freedom to set its own course, and greater responsibility for getting it right.
Ten years after the referendum, I think it is doing a good job in this area. There are gaps, particularly in Europe, but there are also real opportunities for businesses investing internationally.
In 2016, I wrote that Brexit might create opportunities for the UK to develop its investment treaties. These agreements rarely make headlines, but they can matter enormously when an overseas investment runs into trouble.
Imagine a business builds a factory abroad. Years later, the government takes it without compensation or arbitrarily withdraws the licence needed to operate it. An applicable investment treaty may allow the investor to seek compensation directly from the state through independent international arbitration. That can provide a valuable route beyond the local courts. The investor must establish a treaty breach; an unwelcome policy change is not enough.
Britain already had an extensive network of investment treaties before Brexit. Much of that network remains in place. The opportunity has been to build on it, and one of the clearest examples is the Pacific trade agreement known as CPTPP.
The UK joined the CPTPP in December 2024. Following Canada’s ratification, the agreement has applied between the UK and all 11 other members since 1 September 2026. Its investment provisions give qualifying investors access to treaty protections and, in many member countries, international arbitration. There are exceptions, including the exclusion of investor-state arbitration with Australia and New Zealand.
For businesses, this makes the UK worth considering when planning the ownership of overseas investments. Whether a UK company secures protection depends on the particular treaty and the commercial structure. Simply incorporating here does not guarantee coverage.
Europe presents a less reassuring picture. Some investment treaties between the UK and EU countries have ended, and the UK–EU trade agreement does not replace their investor-state arbitration rights. Older investments may still benefit from provisions extending protection after a treaty ends, sometimes for many years. The investment date and the terms of the termination matter.
Looking ahead, I expect the UK’s most promising opportunities to lie in strengthening protection outside Europe. The quality of any future investment arrangements with India will be one test of that ambition. Closer trading relationships are valuable, but businesses also need effective remedies when a government breaches its commitments.
I also expect political and regulatory risk to give investment protection a more prominent place in deal planning. Businesses and their advisers should ask which treaties apply, who holds the investment and what remedies are available before committing funds. Restructuring once a dispute is foreseeable may be too late.
On this aspect of Brexit, I see grounds for optimism. The UK has preserved useful protections and added new ones. Businesses that understand how to use them may be better placed when an overseas investment goes wrong.
Jan Kunstyr is a dual-qualified lawyer in England & Wales and the Czech Republic. Jan key part of Sherrards’ Arbitration Unit and leads the firm’s Czech and Slovak Desk, advising on international arbitration and cross-border disputes.
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