Rules and Practices of International Investment Law and Arbitration

Under the international law of State responsibility, the existence of an internationally wrongful act requires that three cumulative conditions be fulfilled: (1) attribution of a conduct to the State; (2) breach of a State’s international obligation by that conduct; and (3) a lack of circumstances precluding the wrongfulness of that conduct. A finding that such an internationally wrongful act occurred entails certain legal consequences, which in particular requires the State to provide full reparation for the damages caused. Chapter 15 analyses how these rules apply in the context of investor–State arbitration. More precisely, it focuses on attribution, circumstances precluding wrongfulness and reparation, with Part II of the textbook setting out a discussion of the relevant breaches of IIA obligations. This analysis is conducted in light of the relevant treaty and arbitration practices as well as the Articles on Responsibility of States for Internationally Wrongful Acts, which are almost systematically referred to by arbitration tribunals when dealing with those matters.