13 Jan Venezuela Announces Massive Work Program for International Lawyers
Or so to speak.
The standard narrative about the law of expropriation is that there was a wave of nationalizations (and subsequent arbitrations) in the 1960’s and 1970’s, then a wave or privatizations in the 1980’s and 1990’s. Today’s disputes about expropriation, so the story goes, are about regulatory expropriation–how different types of regulations (environmental, health, tax, etc.) can actually be effective expropriations. In this interconnected new world order, we don’t have to really worry anymore about brutish old-style nationalizations of whole industies. They’re so passe.
I guess Hugo Chavez never got the memo because he announced today that he would nationalize “absolutely all” of Venezuela’s energy industry and electricity sector. This would include, he specified, any foreign-owned projects.
Companies expected to be affected include: Chevron, Conoco Phillips, ExxonMobil, Britain’s BP, France’s Total, and Norway’s Statoil.
Time to dust-off those bilateral investment treaties and call your favorite international lawyer.
UPDATE
Joel Trachtman of the International Economic Law and Policy Blog writes about Venezuela’s actions here. Joel notes in particular that Venzuela does not have a BIT with the U.S.
I pity Norway that our constitution is believed to forbid Bilateral Investment Treaties. Lot’s of tax treaties with Venezuela, no investment treaties.
Any recommended reading on the narrative of the law of expropriation?
Probably the two most famous cases are SEDCO, Inc. v. National Iranian Oil Company, Iran-U.S. Cl. Trib., 10 Iran-U.S. Cl. Rep. 180 (1986) and Award on the Merits in Dispute Between Texaco Overseas Petroleum Company/ California Asiatic Oil Company and the Government of the Libyan Arab Republic, 17 I.L.M. 1 (1978).
For the ICJ’s brief foray into investment disputes, see the ELSI case:
http://www.icj-cij.org/icjwww/icases/ielsi/ielsiframe.htm
Enormous amounts have been written on BITs and expropriation, including: George von Mehren, Claudia T. Salomon, &Aspasia A. Paroutas, Navigating Through Investor-State Arbitrations—An Overview of Bilateral Investment Claims, 59 DISP. RESOL. J. 69 (2004); Kenneth J. Vandevelde, The Political Economy of a Bilateral Investment Treaty, 92 AM. J. INT’L L. 621 (1998); and RUDOLF DOLZER &MARGRETE STEVENS, BILATERAL INVESTMENT TREATIES (1995).
There is also a great deal available via the Internet, and the website for ICSID is probably the best place to start: http://www.worldbank.org/icsid/.
For the question re: Norway, and for the situation where no BIT is in place, the ICJ’s Barcelona Traction (Second Phase) judgment is the place to begin for understanding the diplomatic protection framework for espousing an expropriation (or any other diplomatic protection) claim.