Chapter 8 The impact of investment arbitration in the development of state responsibility defences
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This chapter considers the contribution of investment arbitration towards the development of the defences in the Articles on State responsibility. It begins by reviewing the role of judicial decisions in the development of international law generally, and considers the role played by investment tribunals (broadly understood) in the development of the general law of State responsibility. The chapter then turns to assess the role of this body of case law on the development of the three defences most commonly invoked in investment disputes: force majeure, state of necessity and countermeasures. With respect to force majeure, the chapter turns to the historical case law of the PCIJ and mixed claims commissions and shows the significant impact these decisions had on the development of this defence. With respect to state of necessity and countermeasures, the chapter considers recent investment case law. The chapter argues that in both cases, investment tribunals have contributed to the consolidation of these defences in customary law, and that in grappling with the application of these general and abstract rules to the particular circumstances of each dispute, tribunals have also had to specify and refine the requirements and conditions of each rule. Perhaps more relevantly, these tribunals have had to engage with situations not addressed by the Articles on State Responsibility (or considered during their drafting history) and even with fundamental aspects of these two rules. As an illustration, the chapter will consider the question of the permissibility of countermeasures which affect the rights of investors, as an example of the former type of engagement, and the classification of state of necessity as an excuse rather than a justification, as an example of the latter.

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