Book contents
- Frontmatter
- Contents
- Preface
- Preface to the first edition
- Abbreviations
- Glossary of Arabic words used
- Table of cases
- Table of statutes
- Table of treaties
- PART I Certain preliminary issues
- PART II Encouragement and protection: form and content
- 4 Legal incentives
- 5 Unilateral guarantees
- 6 Investment treaties: bilateral and multilateral
- 7 Investment insurance programmes
- 8 Assessment of compensation
- 9 Economic development agreements
- PART III Remedies
- Notes
- Select bibliography
- Index
8 - Assessment of compensation
from PART II - Encouragement and protection: form and content
Published online by Cambridge University Press: 02 December 2009
- Frontmatter
- Contents
- Preface
- Preface to the first edition
- Abbreviations
- Glossary of Arabic words used
- Table of cases
- Table of statutes
- Table of treaties
- PART I Certain preliminary issues
- PART II Encouragement and protection: form and content
- 4 Legal incentives
- 5 Unilateral guarantees
- 6 Investment treaties: bilateral and multilateral
- 7 Investment insurance programmes
- 8 Assessment of compensation
- 9 Economic development agreements
- PART III Remedies
- Notes
- Select bibliography
- Index
Summary
As pointed out in chapters 5 and 6, in Sudan and Saudi Arabia foreign investors are given legal assurance, by the local laws and often by treaty, that their investments will not be expropriated or nationalized except for a public purpose and on payment of fair or just compensation. As expropriation and nationalization can never be wholly excluded for the future, what is left to foreign investors in the end is the right to compensation. The existence of such a right under international law is well established. It is supported by existing case-law of international tribunals, state practice and by legal opinion. Though the former communist states sought to deny the existence of the right of compensation in case of nationalization or expropriation, they actually awarded compensation by special lump-sum agreements to Western enterprises.
As nationalization is a relatively recent phenomenon, international law has not evolved a clear or satisfactory standard of valuation of nationalized property for the purpose of compensation. Because of this uncertainty it has become important to foreign investors to have some assurance of favorable techniques and procedures that would secure to them a high scale of compensation. Neither the investment laws nor yet the treaties normally contain detailed rules in this respect. They simply provide general descriptions such as ‘adequate’, ‘prompt’, ‘effective’, ‘equitable’ or ‘just’ compensation. This state of affairs takes the inquiry to the practice of states, to see whether it is possible from that practice to fill in the gap.
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- Publisher: Cambridge University PressPrint publication year: 2003