Armed Conflict as Force Majeure in International Investment Law

Manchester Journal of International Economic Law (2019) Volume 16, Issue 1: 28-56

35 Pages Posted: 31 May 2019

See all articles by Jure Zrilic

Jure Zrilic

University of Liverpool, School of Law & Social Justice

Date Written: May 7, 2019

Abstract

This article examines how force majeure has been invoked in international investment law as a shield against claims of state responsibility for losses that foreign investors sustained in various types of turmoil. The historically rich diplomatic and jurisprudential practice has created a misplaced expectation about the potential of this international law principle as a defence in the modern investment law context. The article argues that the usefulness of the defence depends on the nature of the claim, whereby different categories of claims may be susceptible to different concepts of force majeure, distinguishing in particular between force majeure as a circumstance precluding wrongfulness, a circumstance informing the duty of due diligence, and an exception in investment contracts. The article examines how these concepts overlap and differ, and how the interaction between them affects their application as a defence in conflict-related investment arbitration cases. It argues that while the potential of force majeure as a circumstance precluding wrongfulness is limited, its manifestation as an aspect that modifies the obligation of due diligence or an exception included in investment contracts, has played an important role in investment cases concerning conflict-related losses.

Keywords: force majeure, armed conflict, international investment law, investor-state arbitration, circumstances precluding wrongfulness, due diligence, investment contracts

Suggested Citation

Zrilic, Jure, Armed Conflict as Force Majeure in International Investment Law (May 7, 2019). Manchester Journal of International Economic Law (2019) Volume 16, Issue 1: 28-56, Available at SSRN: https://ssrn.com/abstract=3384201

Jure Zrilic (Contact Author)

University of Liverpool, School of Law & Social Justice ( email )

Liverpool
United Kingdom

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
147
Abstract Views
2,921
rank
221,479
PlumX Metrics