Understanding International Expropriation: Principles And Protections

Adamay Malik, National Law School of India University, Bengaluru

ABSTRACT

The complexity of expropriation under international law is examined in this essay, with a focus on foreign investments. It explores the differences between direct and indirect expropriation, emphasising the function of customary international law and international investment agreements (IIAs) in offering investor safeguards and channels for resolving disputes. While indirect expropriation devalues investments without a transfer of ownership, direct expropriation entails the state taking property without the owner's consent. The study examines how state laws must strike a compromise between upholding law and order and preventing undue harm to investors. It also looks at the difficulties in defining compensable expropriation and permitted state measures, highlighting the necessity for consistency and accuracy in these definitions. The study concludes by highlighting how expropriation is a dynamic process and the continuous attempts to strike a balance between state sovereignty and investor protection while making foreign investments.