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Martín Molinuevo and Michael Jacobson

International rules on foreign investment in trade agreements came from two sets of disciplines. Investment chapters are the obvious source of rules on foreign investment. In addition, chapters on trade in services, especially those following the GATS structure, feature rules on foreign direct investment (FDI) in the services sector. The chapter focuses on disciplines in ‘trade in services’ and their relation to FDI. In particular, it assesses the relationship between the concepts of FDI and trade in services, reviews the scope of main disciplines in services and investment chapters in trade agreements, and brings attention to potential legal conflicts between them. Finally, it considers potential implications of this relationship in dispute resolution by considering how investment disputes in services would be considered at the dispute settlement mechanism of the WTO, and how a trade in services dispute would be viewed in investment arbitration.