I Introduction

For the purposes of this brief review, a foreign investor is assumed to be, in principle, entitled to compensation in damages, resulting from a breach by a host state of its obligations relating to the protection of an investment (wrongfulness).2 The right to compensation arises under the applicable law, which is here taken to be 'rules of international law' as may be the case when the claims are based on the breach of a treaty, the parties have expressly or implicitly agreed that such rules shall apply, or when the arbitrators in some institutional arbitrations find that the application of rules of international law is most appropriate. What is said may also be of interest when national law applies to the dispute, but its application must be checked with reference to rules of international law; compare International Centre for Settlement of Investment Disputes (ICSID) Convention Article 42(1) and ICSID Additional Facility Rules (Arbitration) Article 54(1).3

It is further assumed that the host state puts up a defence with a view to reduce the entitlement of the investor. Such defence may be that compensation should be denied or reduced because of contributory fault or failure to mitigate the loss. A defence may also be based on the doctrine of investment risk, the doctrine of necessity, the very fact that the respondent is an entity of a public nature or that the investor has conducted some form of corrupt act relating to the investment.

II Reduction of damages Owing to contributory fault

Contributory fault is recognised within international law.4 The International Law Commission Articles of State Responsibility (the ILC Articles) Article 39 sets out: 'In the determination of reparation, account shall be taken of the contribution to the injury by wilful or negligent action or omission of the injured State or any person or entity in relation to whom reparation is sought.'5 Contributory fault has been successfully invoked by states in a number of disputes.

MTD v. Chile 6 (an ICSID arbitration under the Chile–Malaysia bilateral investment treaty (BIT)) regarded a contract between MTD and Chile's Foreign Investment Commission (FIC) for the development of a real estate project consisting of the construction of a self-sufficient satellite city. The project required the rezoning of the land by the Ministry of Housing and Urban Development. MTD had made its investment upon approval of the contract by the FIC, although the necessary rezoning had not yet been approved. As it turned out, MTD could not start the works and suffered economic loss. The arbitral tribunal found that Chile, by authorising an investment that could not take place for reasons of its urban policy, was in breach of the fair and equitable treatment standard defined in the BIT. The tribunal did, however, also find that MTD was in contributory fault, since it failed to adequately control that the project would receive necessary permits, or at least failed to structure the investment in such a way that the injury would be as small as possible if necessary permits were not granted. MTD was found not to have acted as a 'wise investor' and hence that it had contributed to its own misfortune.7 The arbitral tribunal found that MTD should bear 50 per cent of the damages it had suffered, but did not develop the reasoning behind the apportionment.

An ICSID annulment committee reviewed the award in 2007 after an application for annulment filed by Chile.8 In its decision, the committee inter alia emphasised the general difficulties in apportioning fault in investor–state disputes and also noted that contributory fault by an investor often leads to a fifty-fifty apportionment of the damages in international investment arbitrations. The committee stated that:

As is often the case with situations of comparative fault, the role of the two parties contributing to the loss was very different and only with difficulty commensurable, and the Tribunal had a corresponding margin of estimation. Furthermore, in an investment treaty claim where contribution is relevant, the respondent's breach will normally be regulatory in character, whereas the claimant's conduct will be different, a failure to safeguard its own interests rather than a breach of any duty owed to the host State. In such circumstances, it is not unusual for the loss to be shared equally. International tribunals which have reached this point have often not given any “exact explanation” of the calculations involved.9

One way to rationalise the outcome would be to say that given the difficulties, an apportionment may end anywhere between the end points on a stick. The least arbitrary point on the stick is the middle point. So if none of the parties can convince the tribunal that another apportionment is more reasonable, the middle point will be chosen as it is the least arbitrary point of decision.

The middle-point approach is not generally prevailing, however. In the ICSID arbitration Occidental v. Ecuador,10 the arbitral tribunal came to the conclusion (with a dissent)11 that the investors should bear 25 per cent of the loss. The award illustrates an upside-down application of contributory fault. The investor was in breach, but the state's reaction to the breach was disproportionate so that the investor became entitled to an apportioned compensation. Occidental had, in 1999, entered into a participation contract with Ecuador to explore and exploit hydrocarbons in a certain region of the country. Occidental later concluded an agreement with another investor to which a share of Occidental's hydrocarbon interest was transferred. This triggered Ecuador to terminate the participation contract and to resort to certain expropriation measures.

The arbitral tribunal found that Occidental's agreement with the other investor amounted to a breach of the participation contract as well as Ecuadorian law. The tribunal, however, also found that Ecuador's termination of the participation contract had not only been made in violation with Ecuadorian law, the BIT and customary international law, but also was a disproportionate response to Occidental's actions. The tribunal found that Ecuador had not suffered any quantifiable loss as a direct result of the other investor taking economic interest in the hydrocarbon exploitation. Since Ecuador's measures were disproportionate, Occidental was entitled to damages. However, as a party in breach, Occidental was found to have contributed to its own loss, which caused a 25 per cent reduction of the claimed damages by the tribunal.

Occidental v. Ecuador can be compared with Genin et al v. Estonia.12 The dispute concerned the cancellation by a state-owned bank of an operating licence held by a financial institution in which the claimants were shareholders. The reason for the cancellation was said to be financial uncertainties with the financial institution. The tribunal found that the bank had taken actions because of the behaviour of the investors comprising the non-disclosure of the true ownership of the financial institution. The behaviour of the investors was found to have caused the bank's cancellation of the operating licence, and was the sole cause for the alleged injury. The state's conduct, therefore, was not found to be in breach of the relevant BIT, and the investors' claim was therefore denied in its entirety.

More recently, the principle of contributory fault was applied in the consolidated arbitrations usually referred to as the Yukos Awards.13 The arbitrations concerned measures taken by Russia primarily between 2003 and 2007. The investors claimed that Russia had breached the Energy Charter Treaty (ECT) by failing to treat the investments in a fair, equitable and non-discriminatory manner. The investors further claimed that Russia unlawfully expropriated the investments.

The tribunal found that Russia's measures had included forced sale of one of Yukos' main oil production complexes, tax reassessments, harassment and more. Russia, however, as defence, invoked several instances of alleged misconduct by the investors, including skimming of profit, abuse of Russian corporate law, engagement in a tax optimisation scheme and obstruction of enforcement of tax claims.

The arbitral tribunal found that one of the invoked misconducts was to be seen as contributory fault by the investors according to Article 39 of the ILC Articles, namely the investors' abuse of low-tax regions. The tribunal seemingly regarded this to be one of the underlying causes of events that followed (i.e., wrongful measures taken by Russia).

Because of this, the tribunal reduced the claimed damages by 25 per cent, without any detailed explanation of the basis for the apportionment, however. The tribunal acknowledged that it had a wide discretion to apportion responsibly, and that a 25 per cent reduction would best represent the parties' shares of responsibility.

The most recent discussions regarding contributory fault in ICSID arbitrations can be found in the awards in Bear Creek Mining Corporation v. Republic of Peru14 and Burlington Resources v. Republic of Ecuador,15 both rendered in 2017. In both cases, one of the appointed arbitrators found that the compensation to the claimants should be reduced due to the contributory fault.16 The majority in both cases, however, found that the states failed to meet its burden to prove contributory fault and thus dismissed the state's claims for liability of the investor. Since the principle of contributory fault was not de facto applied by the tribunal, the cases will not be discussed further in this review.

III Reduction of damages Owing to failure to mitigate loss

Reduction resulting from failure to mitigate loss refers to a situation where the injured party is, in principle, entitled to compensation, but fails to take 'reasonable steps' to reduce the loss.

Although it is widely recognised in civil law17 as well as in common law that failure to mitigate may lead to a reduction of the compensation, the standing and closer meaning of the principle as part of international law is not entirely clear. It finds its strongest manifestation in international contract law. A duty to mitigate is, for example, explicitly expressed in the UNIDROIT Principles of International Commercial Contracts (PICC) and in the Convention on the International Sale of Goods (CISG).18

In the case concerning the Gabčikovo-Nagymaros Project (Hungary v. Slovakia),19 a leading International Court of Justice case, the court established that although the principle of an injured party's duty to mitigate is internationally recognised, it can only be invoked as a base for calculating damages.20 Thus, failure to mitigate can never materially justify a wrongful act. The court concluded that the duty to mitigate is not a legal obligation that itself entails responsibility, but rather that a failure to mitigate by the injured party precludes recovery to that extent.

In AIG v. Kazakhstan,21 the dispute arose after Kazakhstan's expropriation of the investors' investment in a joint-venture real estate development project. The state argued that the investors had failed to mitigate since they had declined an offer to develop on an alternative site instead of on the site that had been expropriated. The tribunal found that the investors were under no circumstances obligated to accept the alternative site, by law or by contract. Hence, the choice by the investors to decline the offer did not amount to a failure to mitigate. The tribunal stated that:

When it comes to taking of the property of a foreign investor and to offers of “an alternative solution” more favourable to the host State, this Tribunal is of the view that once the host State decides to expropriate or to take measures tantamount to expropriation of property, it would be wrong in principle to impose on the injured party (the creditor or foreign investor) a “duty” to examine (and if reasonable, to accept) an alternative solution. Such an imposition would only encourage Governments to breach with impunity solemn provisions of an international treaty and weaken the protection of foreign investors – which such a treaty is expressly designed to safeguard.22

IV Investment risk

Investments are always subject to risk, meaning that the expected return on the investment may not materialise because of ordinary business risk. International investments are further exposed to an additional risk – country risk – which causes the investor to seek a higher rate of return. A portion of the country risk may be referred to as political risk. The country risk increases in proportion with the expected timescale of the investment. The doctrine of investment risk seeks to filter out losses resulting from commercial risk and some elements of the country risks, so that investment treaties do not work as an insurance against risks that the investor shall bear. Any part of the loss that results from impudence shall be eliminated from the compensation. In brief summary, it seems correct to say that when a loss is caused by a number of factors, the compensation shall be based only on the factors that are relevant to the purpose of the treaty.

Himapurna v. PLN23 illustrates one way to go about it. The arbitration took place under the UNCITRAL arbitration rules. The substantive law governing the energy sales contract under dispute was found to be Indonesian law. The parties had agreed, however, that the tribunal should not be bound by rules of law insofar as their application would contradict the terms of the contract. The tribunal applied international law since the parties had referred to international authorities in their pleadings and submissions showing 'tacit common position as to the permissibility of such references'. Himapurna was found to be entitled to compensation for lucrum cessans. Himapurna submitted that the total projected revenues through 2030 would amount to US$4.048 billion if discounted at 8.5 per cent. Himapurna then deducted the present value of costs at the same discount rate to get the lucrum cessans. The tribunal reduced the compensation sought because of a number of factors, which we will not detail here. As regards the remaining portion of the claim, the tribunal determined the present value of the future net income. Himapurna had, as mentioned above, applied a discount rate of 8.5 per cent to the projected revenue stream and to the costs associated with the revenues. The tribunal adjusted the discount rate, having regard to the risks facing the project, and found that the rate should be 19 per cent, which brought down the compensation considerably. The tribunal pronounced:

The fact remains that it is riskier to enter into a 30 year venture in Indonesia than in more mature economies. . . . [T]here are documents which by their terms allot 100 per cent of the risk to the debtor bonds. Although they may be denominated in US dollars, although they may stipulate absolute obligation to pay, it still makes a difference whether the issuer is Switzerland or Swaziland.24

Thus, the level and type of risk that an investor generally needs to assess depends on the risk profile of the state where the investment is made. This is also illustrated by the AMT v. Zaire dispute.25 It concerned damage that had been made to certain property owned by the investor by Zairean armed forces. The tribunal found that Zaire was in breach of the relevant BIT but did not award the investor the claimed damages in full. The tribunal indicated that the awarded damages should be lower than they would have been if the investment had been made in a more economically and politically stable state. The tribunal found that the investor seemed to have calculated the claimed damages with a method practicable under normal circumstances in an 'ideal country' with a very stable climate of investment and, therefore, decided to use another method for calculating fair compensation. The tribunal pronounced that:

Preferably, the Tribunal will opt for a method (for calculating damages) that is most plausible and realistic in the circumstances of the case, while rejecting all other methods of assessment which would serve unjustly to enrich an investor who, rightly or wrongly, has chosen to invest in a country such as Zaire, believing that by doing so the investor is constructing a castle in Spain or a Swiss chalet in Germany without any risk, political or even economic or financial or any risk whatsoever.26

There are also examples where states, as a ground for reduction or decline of damages claims, have successfully argued that the investor has made an inadequate assessment of relevant investment risks prior to the investment, or voluntarily accepted the relevant risks, which should lead to a reduction of damages. See for example the MTD v. Chile dispute, mentioned under Section II.

Azurix v. Argentina27 is an example of when a tribunal specifically considers business risk taken by the investor when deciding on the apportionment of damages. An American company, through an Argentinian subsidiary, invested in a 30-year water concession in the Buenos Aires province. The concession was, however, terminated by the province in only its third year. The tribunal found that the termination by the state was wrongful. It also found, however, that the investor had made an irrational business decision by overpaying for the concession. Because of this, the tribunal found that the investor had to have assumed the risk of not recouping the investment. The tribunal found that most of the investor's loss was because of the irrational business decision rather than because of the state's conduct.

V State of necessity

The ILC Articles describe 'necessity' as circumstances that may preclude wrongfulness by a state.28 A state of necessity refers to a situation where a state's only option to safeguard an essential interest against a grave and imminent peril is to pursue actions in breach with, for example, a BIT. Article 25 of the ILC Articles provides the following:

  1. Necessity may not be invoked by a State as a ground for precluding the wrongfulness of an act not in conformity with an international obligation of that State unless the act:
    1. is the only way for the State to safeguard an essential interest against a grave and imminent peril; and
    2. does not seriously impair an essential interest of the State or States towards which the obligation exists, or of the international community as a whole.
  2. In any case, necessity may not be invoked by a State as a ground for precluding wrongfulness if:
    1. the international obligation in question excludes the possibility of invoking necessity; or
    2. the State has contributed to the situation of necessity.

Article 27(b) of the ILC Articles defines state of necessity as a circumstance that may be invoked as a circumstance precluding wrongfulness regarding the question of damages.

The possibility for a state to invoke necessity (or similar) as a defence, and the preconditions to do so, is also, in some cases, explicitly stated in BITs.29

State of necessity has been invoked by Argentina in several international investment disputes with American companies with similar factual circumstances. In CMS,30 Enron31 and Sempra Energy,32 Argentina invoked state of necessity, both treaty-based and according to customary international law, because the state, as a result of a political, social and economic crisis in the late 1990s and early 2000s, had to take certain measures to maintain public order and protect its essential security interests.

In all of the above-mentioned arbitrations, the necessity defence was rejected by the tribunal since the requirements according to international law for invoking state of necessity were not met. Since necessity could not be invoked according to international law, the tribunals did not find it necessary to take further judicial overview according to the BIT.33

However, in LG&E v. Argentina,34 which had similar factual circumstances to the disputes discussed above, the tribunal found Argentina's invocation of necessity according to the relevant clause in the BIT and general international law justified. The tribunal considered the overall conditions that were invoked by Argentina and found that they 'constituted the highest degree of public disorder and threatened Argentina's security interests'.35 Argentina was, therefore, excused from liability during the specific period when the tribunal found that it was in a state of necessity. The state, however, had to pay damages for wrongful measures taken outside this period.

VI The Public Nature of the State

Sergey Ripinsky and Kevin Williams observe that there are indications that the public nature of the respondent state may have an effect on compensation because of a wrongdoing. This may be the case when the wrongdoing does not result in any transfer of wealth and in cases where a large amount of compensation would have a serious adverse effect on the state's welfare.36

The emerging view was perhaps aptly summarised by Professor Sir Ian Brownlie in his separate opinion in CME v. Czech Republic:

[I]t is simply unacceptable to insist that the subject-matter is exclusively commercial in character or that the interests at issue are, more or less, of essential elements in a Treaty relation. The first element is the significance of the fact that the Respondent is a sovereign State, which is responsible for the well-being of its people. This is not to confer a privilege on the Czech Republic but only to recognize its special character and responsibilities. The Czech Republic is not a commercial entity.37

VII CORRUPTION

Most states perceive corruption to be a violation of international public policy and international law. However, in numerous developing countries corruption is still a real and widespread problem. Corruption and bribery by the investor has been invoked as a defence by host states in several ICSID arbitrations.38 In World Duty Free Co Ltd v. Republic of Kenya,39 the investor brought a claim against Kenya for an alleged expropriation of a contract to operate duty-free concessions at Kenya's international airports in Nairobi and Mombasa. Kenya was, however, able to show that the concession contract had been procured through the payment of a cash bribe to the former President of Kenya. The tribunal found that a contract procured by a bribe was in violation of international public policy and thus void on contractual grounds. The tribunal therefore dismissed all claims against Kenya since the investor was found:

[n]ot legally entitled to maintain any of its pleaded claims in these proceedings as a matter of ordre public international and public policy under the contract's applicable laws.40

In another case, Metal-Tech Ltd v. Republic of Uzbekistan,41 the tribunal found that it lacked jurisdiction to decide the dispute because of corruption related to Metal-Tech's investment. Metal-Tech had in 2000 formed a joint venture with two state-owned Uzbek companies to build and operate a plant for production of molybdenum products. In 2006, a criminal proceeding was initiated because it was suspected that officials of the joint venture had abused their authority. Shorty thereafter, the Cabinet of Ministers in Uzbekistan adopted a resolution that abolished the joint venture's exclusive rights to purchase certain raw materials required to produce molybdenum and to export the products. In 2010, Metal-Tech initiated arbitration, claiming that Uzbekistan had breached its obligations under domestic law and the Israel–Uzbekistan BIT.

The tribunal's decision that it lacked jurisdiction was based on its finding that Metal-Tech's investment was not 'implemented' in accordance with the laws and regulations of Uzbekistan (Uzbekistan had under the relevant BIT only consented to ICSID arbitration relating to such investments). The tribunal found that payments had been made by Metal-Tech to, inter alia, a government official and the brother of the then Prime Minister in connection with Metal-Tech's initial investment. This, according to the tribunal, constituted corruption to the extent that the investment was considered to not have been established in accordance with the laws and regulations of Uzbekistan and, as a consequence, the dispute could not be subject to arbitration under the BIT.

Lastly, in an arbitration under the ECT, the state (Croatia) raised corruption as a defence to the investor's (MOL Hungarian Oil and Gas Company Plc) claims.42 Croatia argued that a certain shareholder's agreement relating to MOL's investment was procured through bribery of Croatia's then Prime Minister. Croatia relied on a jurisdictional objection based on the argument that the corruption that underlies the shareholder's agreement entailed, inter alia, lack of consent by the host state, lack of investment and violation of international public policy.

VIII Conclusion

This chapter has discussed some of the most commonly seen defences in investor–state arbitrations. However, the law regarding defences to damages claims in investment arbitrations appears to be under development. This is, in the author's opinion, particularly true when it comes to the doctrine of investment risks, which also requires that the arbitrators shall be susceptible to economic theory. Another field under development is the consideration of the public nature of the respondent state, which in some instances may be an answer to some of the political criticism voiced against international investment arbitration.


Footnotes

1 Rasmus Josefsson is an associate at Sandart & Partners Advokatbyrå KB.

2 Consequently, we will not discuss circumstances that may preclude wrongfulness such as consent, self-defence, countermeasures, force majeure and distress. See further, International Law Commission's Articles of State Responsibility Chapter V. See hereto, A Newcombe and A Paradell, Law and Practice of Investment Treaties, 2009, page 510 et seq. We will, however, touch upon the doctrine of necessity in spite of the fact that necessity may preclude wrongfulness altogether.

3 See generally G Cordero-Moss and D Behn, 'The Relevance of the Unidroit Principles in Investment Arbitration', Unif. L. Rev., 2014, pages 1–39.

4 S Ripinsky and K Williams, Damages in International Investment Law, 2008, page 314.

5 Responsibility of States for Internationally Wrongful Acts 2001, annex to General Assembly Resolution 56/83 of 12 December 2001.

6 2 MTD Equity Sdn Bhd and MTD Chile SA v. Republic of Chile, final award of 25 May 2004, ICSID Case No. ARB/01/7.

7 Paragraph 242.

8 Decision of 21 March 2007.

9 Paragraph 101.

10 Petroleum Corporation and Occidental Exploration and Production Company v. The Republic of Ecuador, final award of 5 October 2012, ICSID Case No. ARB/06/11. The award was partially annulled; decision of 2 November 2015.

11 One of the co-arbitrators (appointed by ICSID), Professor Brigitte Stern, found that the 'contribution of the Claimants to the damage has been overly underestimated [by the majority]'. Professor Stern moves on to compare the case at hand with the MTD v. Chile case and concludes that '[h]ere the split 50/50 would have been even more justified [than in the MTD case], as the Claimants have acted imprudently and illegally.'

12 Alex Genin, Eastern Credit Limited Inc and A S Baltoil v. The Republic of Estonia, final award of 25 June 2001, ICSID Case No. ARB/99/2.

13 Veteran Petroleum Limited (Cyprus) v. The Russian Federation, UNCITRAL, PCA Case No. AA 228, Final Award, 18 July 2014; Hulley Enterprises Limited (Cyprus) v. The Russian Federation, UNCITRAL PCA Case No. AA 226, final award of 18 July 2015; and Yukos Universal Limited (Isle of Man) v. The Russian Federation, UNCITRAL, PCA Case No. AA 227, final award of 18 July 2014.

14 Bear Creek Mining Corporation v. Republic of Peru, final award of 30 November 2017, ICSID Case No. ARB/14/21.

15 Burlington Recources Inc. v. Republic of Ecuador, final award of 7 February 2017, ICSID Case No. ARB/08/5.

16 See Professor Philippe Sands' (QC) dissenting opinion to the Bear Creek Mining Award, para 39 and Professor Brigitte Stern's dissenting opinion as regards contributory fault in footnote 1113 of the Burlington Resources Award. Professor Stern also served as co-arbitrator in the Occidental case discussed above where she also had a dissenting opinion as regards the issue of contributory fault, see note 11.

17 It should be noted, however, that the principle is not applied in all civil law jurisdictions. For example the principle is not recognized under French law, see  Herfried Wöss, et. al., Damages in International Arbitration Under Complex Long-Term Contracts (2014), page 215.

18 See, for example, Article 7.4.8 in the PICC and Article 77 in the CISG.

19 ICJ GL 92, final award of 25 September 1997.

20 Paragraph 80.

21 AIG Capital Partners Inc and CJSC Tema Real Estate Company Ltd v. The Republic of Kazakhstan, final award of 7 October 2003, ICSID Case No. ARB/01/6.

22 Paragraph 10.6.4(5)(a).

23 Final award of 4 May 1999, reported in XXV Yearbook of Commercial Arbitration (2000) pages 13–118.

24 Paragraph 358.

25 American Manufacturing & Trading Inc v. Republic of Zaire, final award of 21 February 1997, ICSID Case No. ARB/93/1.

26 Paragraph 7.14.

27 Azurix Corp v. The Argentine Republic, final award of 14 July 2006, ICSID Case No. ARB/01/12.

28 In international investment arbitrations, parties sometimes argue that the ILC Articles cannot apply in investor–state disputes since the articles only address responsibilities between states. However, according to the wording of, for example, Articles 1 and 76 it is clear that they are intended to cover all international obligations of the state. For further discussion regarding this, see, for example, K Hobér, Selected Writings on Investment Treaty Arbitration, page 53 et seq.

29 According to William W Burke-White and Andreas Van Staden in 2008, such clauses appeared in at least 200 of around 2,000 BITs then in force. W W Burke-White and A Van Staden, 'Investment Protection in Extraordinary Times: The Interpretation and Application of Non-Precluded Measures Provisions in Bilateral Investment Treaties', Virginia Journal of International Law, Volume 48:2, page 313.

30 CMS Gas Transmission Company v. The Republic of Argentina, final award of 12 May 2005, ICSID Case No. ARB/01/8. The award was partially annulled; decision of 25 September 2007.

31 Enron Corporation and Ponderosa Assets LP v. Argentine Republic, final award of 22 May 2007, ICSID Case No. ARB/01/3. The award was partially annulled; decision of 30 July 2010.

32 Sempra Energy International v. The Republic of Argentina, final award of 28 September 2007, ICSID Case No. ARB/02/16.

33 The tribunals and, in the CMS case, the annulment committee, did put a lot of attention to the issue whether the invoking of the relevant clause in the BIT should be considered as independent to the invoking of international law as manifested in the ILC Articles. For further discussion regarding this issue, see, for example, Yearbook on International Investment Law & Policy 2008–2009, page 370 et seq.

34 LG&E Energy Corp, LG&E Capital Corp and LG&E International Inc v. The Republic of Argentina, decision on liability of 3 October 2006, final award of 25 July 2007, ICSID Case No. ARB/02/1.

35 Decision of liability, 3 October 2006, paragraph 231.

36 S Ripinsky and K Williams, op cit, pages 353 et seq.

37 CME v. Czech Republic, Separate Opinion of professor Brownlie of 14 March 2003, paragraph 74.

38 See, for example, a review of such cases under the tribunals decision in World Duty Free Company Limited v. The Republic of Kenya, final award of 4 October 2006, ICSID Case No. ARB/00/7, paragraph 148–155.

39 World Duty Free Company Limited v. The Republic of Kenya, final award of 4 October 2006, ICSID Case No. ARB/00/7.

40 Paragraph 188.

41 Metal-Tech Ltd. v. Republic of Uzbekistan, final award of 4 October 2013, ICSID Case No. Arb/10/3.

42 MOL Hungarian Oil and Gas Company Plc v. Republic of Croatia, ICSID Case No. ARB/13/32.