Journal of Siberian Federal University. Humanities & Social Sciences / States’ Defenses against Foreign Investors in Times of Political and Economic Crisis

Full text (.pdf)
Issue
Journal of Siberian Federal University. Humanities & Social Sciences. 2024 17 (12)
Authors
Sabalbal, Helene
Contact information
Sabalbal, Helene: Paris 2 Pantheon- Assas University Paris, France;
Keywords
state defense; necessity; non-precluded measures clauses; emergency clauses; right to regulate; general interest; police powers; investment treaties; state responsibility; investment arbitration; crisis; damages; foreign investors
Abstract

During periods of economic and political crises, investors become more vulnerable because States usually adopt quick measures like protective policies and measures of public interest, which frequently come into conflict with international investment law: Foreign investors may resort to arbitration under investment treaties and file complaints usually arguing that changes and measures taken by the State violate the protections offered in these treaties. Legal defenses of States in times of crises are on the other hand very limited and constrained by strict conditions. Host States can invoke their right to modify rules to preserve public order under the customary principle of police powers. States may also rely on certain treaty provisions called non-precluded measures provisions if they exist and / or the exception of necessity under customary international law codified in article 25 of the International Law Commission (ILC) Articles on State Responsibility for Internationally Wrongful Acts to exclude from wrongfulness measures and acts adopted in a crisis situation. Arbitral jurisprudence provided clarifications on how to interpret non-precluded measures clauses in investment treaties in relation to the necessity plea under customary law. It has often addressed the question of whether the necessity defense is self-judging and also has taken different approaches to the determination of damages in cases involving the successful or unsuccessful use of necessity and non-precluded measures clauses

Pages
2337–2346
EDN
DXFMVC
Paper at repository of SibFU
https://elib.sfu-kras.ru/handle/2311/154279

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