COVID-19: Public Health Emergency Measures and State Defenses in International Investment Law

As States declare national emergencies to address the COVID-19 pandemic and enact legislation aimed at combatting the crisis, States may take measures that may adversely affect the investments of foreign investors.

This situation could in turn give rise to claims by foreign investors against States pursuant to international investment agreements (“IIAs”), asserting that substantive treaty protections have thereby been breached.

Investment treaty tribunals regularly consider State measures enacted in the context of major crises. While the COVID-19 pandemic is unprecedented in scope and effect, investment arbitrations addressing measures taken by States in prior crises have raised issues that are likely to be relevant in investment disputes that may arise out of the current health emergency.

This alert memorandum addresses selected legal issues that may arise in investment treaty arbitrations relating to the COVID 19 pandemic, including issues arising out of current measures to cope with the public health emergency as well as measures taken in the coming months to address any subsequent economic crisis. This memorandum further analyses the possible defenses that States are likely to raise.

Please click here to read the full alert memorandum.