L’indemnisation en vertu des traités d’investissement

The document examines the current state of compensation in investment treaty disputes, highlighting a trend toward massive awards driven by the 'discounted cash flow' (DCF) method. It argues that current practices often diverge from international law and national legal standards, creating significant financial burdens for host states. The guide analyzes three main valuation categories—market-based, income-based, and asset-based—and evaluates emerging treaty practices from Africa, India, and the Netherlands. It concludes by proposing four reform options: balancing rules, limiting compensation to actual investment amounts, integrating host-state benefit analysis, and applying national laws.

• Compensation awards in investment treaty arbitrations have reached unprecedented levels, with the largest single award in the Hulley v. Russia case totaling 40 billion USD.
• The increase in award amounts is primarily attributed to tribunals' willingness to use income-based valuations, specifically the discounted cash flow (DCF) method, to project future expected revenues over an investment's entire lifespan.
• There is significant inconsistency in how tribunals apply valuation methods; for example, in Tethyan Copper v. Pakistan, a DCF approach led to a 4.087 billion USD award for a mine never built, whereas in Bear Creek v. Peru, a similar project was valued only at 18 million USD based on actual expenditures.
• Current arbitration practices often ignore critical contextual factors, such as the public interest justification for a measure (e.g., environmental goals) or the host state's actual capacity to pay without causing economic paralysis.
• New treaty practices in Africa (SADC, COMESA, PAIC) are attempting to shift away from 'fair market value' toward a 'balanced approach' that considers public interest, the history of acquisition, and the duration of the investment.
• The guide proposes four primary reform options: implementing balancing rules, capping compensation at the amount actually invested, using a formula based on the lower of the investor's loss or the state's gain, or requiring tribunals to apply the host state's national laws.

APA

Bonnitcha, J., & Brewin, S. (2020). L’indemnisation en vertu des traités d’investissement. International Institute for Sustainable Development. https://www.iisd.org/system/files/2021-01/compensation-treaties-best-practicies-fr.pdf

Chicago

Bonnitcha, Jonathan, and Sarah Brewin. L’indemnisation en vertu des traités d’investissement. International Institute for Sustainable Development, 2020. https://www.iisd.org/system/files/2021-01/compensation-treaties-best-practicies-fr.pdf.

Wikipedia

{{cite report |last1=Bonnitcha |first1=Jonathan |last2=Brewin |first2=Sarah |title=L’indemnisation en vertu des traités d’investissement |publisher=International Institute for Sustainable Development |date=November 2020 |url=https://www.iisd.org/system/files/2021-01/compensation-treaties-best-practicies-fr.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{bonnitcha2020lindemnisation, author = {Bonnitcha, Jonathan and Brewin, Sarah}, title = {{L’indemnisation en vertu des traités d’investissement}}, institution = {International Institute for Sustainable Development}, year = {2020}, month = nov, url = {https://www.iisd.org/system/files/2021-01/compensation-treaties-best-practicies-fr.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }