Introduction

(Note: updated paper 25/05/2020 and 21/09/2020 (footnotes corrections)) The Covid-19 epidemic which is currently sweeping the globe represents a serious challenge not only for the global health system, but also for the more esoteric world of international investment law. Crises inevitably produce litigation, and there is no reason to suppose that this crisis will be any different to any other in this regard. However, as will be seen below, disputes related to health emergencies appear to be less frequent than disputes related to financial or civil emergencies, e.g. civil insurrection, war, and so on. In consequence, there is a lacuna of both jurisprudence and academic writing addressing the possibility of claims against states as a result of measures taken in the context of an epidemic. Although there is a significant body of literature on states use of police powers in the context of their right to regulate, little of this deals with issues of health, and none of it addresses the specific context of an epidemic. In the same vein, although some international investment agreements include carveouts for measures taken to protect health, there are very few cases interpreting such provisions and none in the context of an epidemic let alone a pandemic. Lastly, there appears to be little writing and no cases which address the potential application of the defence of necessity under customary international law to such claims.

This article therefore aims to address the gap in the literature by considering the potential claims which could be brought against states for actions taken in the current crisis and the defences states might raise against such claims. As the legal basis of such claims and defences is not in itself novel, this will involve revisiting some core investment law issues but always through the lens of the Covid-19 crisis and considering the latest developments in the field. It is also important to note as an initial point that this article does not aim to be an exhaustive study of all the potential claims and defences which might be raised as a result of the current crisis, rather it will only address the most important.  The article will proceed firstly, by briefly outlining potentially problematic measures taken by governments due to the Covid-19 pandemic; secondly, it will analyse the potential basis of claims under international investment agreements due to such measures and, thirdly, it will discuss defences which states could raise against such claims.

This paper is be part of a series of papers on "Force Majeure, Hardship, etc". More information here www.transnational-dispute-management.com/news.asp?key=1813

A draft version of this paper was published on TDM (12 May 2020) entitled "The COVID-19 Crisis: An Investment Law Perspective".