Investor-state arbitration

Our multilingual lawyers, admitted to practice in various jurisdictions, advise clients on international investment protection, including matters related to the Energy Charter Treaty (ECT) and various bilateral investment treaties (“BITs”). Since 1959, the Federal Republic of Germany has concluded more than 130 BITs, making it one of the countries with the most investment protection treaties. As a result, German investors enjoy a strong foundation for asserting their property rights under these treaties.

In addition, we are frequently engaged as experts in foreign court proceedings to address specific issues of international law, such as state immunity and the cross-border collection of evidence. In the case of specific disputes, we also assist during the consultation process that precedes investor-state arbitration proceedings.

Our investor-state arbitration team at Noerr has extensive experience in representing both investors and states in arbitration proceedings under international investment treaties, including bilateral investment treaties and the Energy Charter Treaty.

Foreign investors typically commit to projects in host countries with the expectation of success and a reasonable return on their investments. However, political, economic or financial changes within the host country can have a lasting impact on these investments, potentially causing harm to ventures initially deemed secure.

This includes actions ranging from expropriation of investments to regulatory changes that erode the economic basis of the investment. In such cases, disputes, commonly referred to as investor-state disputes, frequently arise. These disputes often raise questions regarding not only the applicable law but also the appropriate forum for resolution. International arbitration, in particular, has proven to be an effective mechanism for resolving such disputes.

Compared to national court proceedings, international arbitration offers several advantages, including independence from state judicial systems, neutrality, flexibility, access to experienced arbitrators and simplified enforcement of awards.

Arbitration proceedings conducted under the rules of the World Bank’s International Centre for Settlement of Investment Disputes (ICSID) play a particularly important role in resolving investor-state disputes. The number of such proceedings has increased significantly in recent years and has proven to be an effective regulatory mechanism for investor-state disputes.

Since its adoption in 1965, the ICSID Convention has been ratified by 155 states, including the Federal Republic of Germany. The ICSID is the most important institution for resolving investor-state disputes.

Both investors and states require expert legal advice within the ICSID framework.

In the field of investor-state arbitration, our team at Noerr combines a deep knowledge of international investment law and arbitration with significant experience representing clients before leading arbitral institutions, particularly under the ICSID Arbitration Rules.

We assist global investments at every stage of arbitration ‒ before, during and after a dispute ‒ across various key industry sectors, including energy and natural resources, banking and finance, and the construction of highly complex facilities. Our clients benefit from our deep industry expertise.

Furthermore, our team also advises on the potential implications of international law, corporate ESG obligations and human rights for international trade transactions.