24 - Compensation assessments: perspectives from investment arbitration

Summary

Introduction: similarities and differences between investment and trade law

The organizers of the workshop and editors of this volume have asked me to draw lessons from the compensation assessments made in international investment law for use in international trade law. Therefore, one must first inquire about the similarities and differences between these two fields of law in order to determine to what extent lessons learned in one field can be applied to the other.

There are obvious differences between international trade transactions and the classical notion of foreign investment. It has even been asserted that the broad concept of investment enshrined in Article 25 of the ICSID Convention can be characterized by drawing a contrast with international trade transactions. Yet, international trade and foreign investment law are two subfields of international economic law and the differences between the two result more from the function of the different regulatory angles which they adopt, rather than from the underlying economic realities. With the present complexity of international business transactions, it is increasingly difficult to draw a clear line between the economic realities of foreign investment and trade, as a transborder transaction (such as a sale of goods or the provision of services) may well constitute a component of a larger investment scheme.

In spite of the commonalities in terms of underlying realities, the present contribution focuses on the specific regulatory angles used by international trade law, on the one hand, and international investment law, on the other hand. Indeed, this approach appears better suited to explore the potential contribution of investment law to trade law with respect to monetary remedies for breach of a given norm or standard of conduct.