Reliance Remedies at the International Center for the Settlement of Investment Disputes

This article will examine the types of situations and expenses which ICSID tribunals have compensated by awarding damages for actual losses suffered and will attempt to illustrate how this choice is generally economically efficient. It will begin by outlining standards of damage remedies that are commonly employed in international law and will conclude with some criticisms of the reliance measure in the investment context. As this article is forum-focused, it will not examine reliance-based remedies in international investment law under other regimes, such as United Nations Commission on International Trade Law (UNCITRAL) arbitrations or under the Iran-U.S. Claims Tribunal, in any detail. Moreover, this article will not explore, other than incidentally, the highly contentious issue of asset valuation methods used in international investment arbitration,4 which are rightly viewed as secondary to the finding of the compensation standardapplicable to the dispute.5 Similarly, the limitations of remoteness and foreseeability which feature in the assessment of damages both in common law and international systems will not be examined. An attempt to define the term investment directly is beyond the scope of this article, although some examples of the types of expenses that ICSID tribunals will recognize when granting recovery will be seen. Finally, this article will not directly consider the controversial issue of when state regulatory actions amount to an expropriation 6 for the purposes of assessing compensation