Introduction

Over the years, U.S. investors in developing countries have frequently faced demands from host governments that they renegotiate the deals under which they made their original investment decisions. In some cases, the demands have amounted simply to expropriation. Few developing countries offer much security to foreign investors. Since sovereign governments can easily break promises, it is difficult for them to make commitments that investors find credible. The history of broken promises makes investors wary of new commitments. The blatant expropriations that were characteristic ...