Expropriation of foreign investments and its limits
- The legal framework for foreign investment
- The Foreign Investment Law
- not audited
The Foreign Investment Law (Decree 9-98) bars direct or indirect expropriation, or any equivalent measure, except on proven grounds of collective utility, social benefit or social interest; in that case it must be done on non-discriminatory bases, in accordance with the law, and with prior and effective compensation. The same law recognizes the investor's right to turn to international arbitration under the applicable treaties and laws. In practice, the arbitral awards against Guatemala have rested on breach of the minimum standard of treatment under CAFTA-DR (RDC, 2012 award; TECO, 2013 award), not on a formal expropriation. The official text of Decree 9-98 in the Diario de Centro América was not located on this pass; SICE/OAS and UNCTAD mirrors were used.
The research is written in English; quoted figures, source names and the titles of legal instruments stay in the language their source published them in.
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