LAWS6916 International Investment Law - Take-Home Assignment

QUESTION 2:

2. Despite/Following your advice, BOC invests in Egypt through the German subsidiary (“BOC GmbH”). However, after some years of operations and profitable business, the environment for foreign investors in Egypt begins to deteriorate. With the election of a new populist government, there is a rise in anti-foreign sentiment, and protestors often blockade the main office of BOC GmbH in Cairo, preventing employees and management from attending work; the Egyptian police does nothing to assist when BOC GmbH calls for help. The GOE also begins to make life difficult, with repeated failures to meet contractual payment obligations to the JVC, the adoption of arbitrary changes in the regulatory framework, the arrest and detention of members of senior management on the basis of fabricated evidence, and the imposition of unjustified tax audits. In addition, the pipeline has repeatedly been attacked and subjected to physical damage in a remote part of Egypt, with the most recent attack by protestors putting the pipeline out of operation for two months and causing BOC to suffer USD 50 million in losses. The General Counsel of BOC has asked you to assess BOC’s litigation options, and to issue a short opinion assessing whether the GOE’s conduct amounts to a breach of obligations under any applicable bilateral investment treaties.