Expropriation claims arise in both investment treaty arbitration and political risk insurance disputes. Direct expropriation involves formal seizure; indirect expropriation involves measures that substantially deprive the investor of economic value.
Political risk experts establish the political context and sequence of government actions. Valuation experts apply the Chorzow Factory fair market value standard to quantum.
Regulatory taking analysis requires distinguishing legitimate public policy from measures that cross the threshold into expropriation under treaty and insurance standards.
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Frequently Asked Questions
How do tribunals assess indirect expropriation?
Tribunals assess the cumulative effect of government measures on investment value, whether the measures were proportional to a legitimate public purpose, and whether the investor was singled out for discriminatory treatment. Political risk experts provide the factual and political context for this analysis.
Is expropriation analysis different in insurance vs treaty claims?
The underlying analysis of host state conduct is similar, but insurance policies have specific definitions and exclusions that may differ from treaty standards. Experts must analyse both the political facts and the applicable policy or treaty language.