The relationship between international tribunals deriving their existence from bilateral investment and other treaties and domestic courts is one of the most important and also interesting issues of modern investment arbitration. This article addresses the issue of the interaction of contract claims and treaty claims, their classification, and subsequent adjudication and discusses related arbitral decisions and their consequences. It provides an overview of the current state of affairs with regard to the contract claim/treaty claim issue and the problem of the characterization of these claims. This article addresses in detail the issue of umbrella clauses and whether the right to arbitrate under Bilateral Investment Treaties (BIT) can be waived by an investor. It tries to identify the current ‘trend’ in the decision-making of arbitral tribunals and mentions that BITs are worded differently and the circumstances of each case will always be different.