The condition of a host country’s investment climate is a significant factor in determining liability and the amount of damages in investor-state disputes. Conflicting assessment methods can create differences amounting to hundreds of millions of dollars in the final award. Existing methods are insufficient and fail to identify and account for political, economic, legal and regulatory differences among nations and project specific exposures. Country risk assessments can help tribunals and investors understand the nuances of a host country’s investment climate and lead to more equitable outcomes. This is the first article that identifies and demonstrates the ways in which country risk methods can help tribunals and parties to the dispute make more informed decisions during both phases of the arbitral dispute. With a step-by-step demonstration of tailored risk assessments, this paper provides a framework for integrating country risk analysis into international arbitration.

Continue reading Country Risk Analysis and Investor-State Dispute Settlement: A New Approach