Week 4

Question 1

Non-discrimination (2)

Answer 1

• most-favoured nation treament
• national treatment

Question 2

Expropriation

Answer 2

(= onteigening) most extreme form of interference by host state with investor; taking foreign investors property.

Question 3

Property

Answer 3

Alienable rights with a market value

Question 4

Conditions for a lawful expropriation (custom law) (4)

Answer 4

• public purpose
• due process
• non-discriminatory
• compensation (Hull-formula)

Question 5

Compensation (3)

Answer 5

• prompt
• adequate
• effective

Question 6

Direct expropriation

Answer 6

Foreign investor loses ownership of investment.

Question 7

Indirect expropriation

Answer 7

When a state takes effective control/interferes with use/enjoyment or benefit of investment, depreciating its economic value, even without direct taking of property.

Question 8

Prompt

Answer 8

Without delay and interest

Question 9

Adequate

Answer 9

Compensation should be equivalent to fair market value of investment before expropriation

Question 10

Effective

Answer 10

Compensation has to be in a recognized usable currency that can be traded in currency of investor

Question 11

BITs

Answer 11

• Fair and equitable treatment
• full protection and security
• regulate expropriation
• make provisions for dispute settlement