Diplomatic Protection

At our firm in West London our solicitors in Heathrow have extensive knowledge in Arbitration proceedings. We are now developing our practice areas. Commercial Law is growing and so are the needs of our clients. Arbitration is a growing industry and we can assist you in the area of Investment Arbitration.  Free initial advice is available from our solicitors in this complex area.  If you are an investor our solicitors can help.

If you are an investor and have made foreign investments in a country you could have a claim against the ‘host state’ meaning the state you made the investment in. There are various types of Investment arbitration between both state and investor and also state and state. An investor who feels that he is powerless against the presence of a state may seek diplomatic protection from his home state in order to take proceedings against the host state.

What is Diplomatic Protection?

Diplomatic protection is made through ‘espousal’ which in effect refers to a government of the home state of the investor taking on a citizens legal claim as its own.

Once espoused an investors claim becomes the home states violation of investment protection promised to a private investor. One method of resolving sovereign disputes is through diplomacy where discussions between government representatives can resolve conflict with minimal damage.

The main aim of diplomatic protection for the wronged investor is the home state as a legal equal to the host is that it is more likely to command the attention of the host in its call for restoring or offering compensation.

Drawbacks of relying on Diplomatic

The main drawback to relying on diplomatic protection for investors is that the individual has no right to espousal.

  1. Espousal lies within the discretion of the state calling itself the sole judge of espousal requests. This means that if there are no concerns relating to an investors dispute itself the state may chose not to espouse a claim under its competence to take into considerations of a political or other nature. The tactical decisions including the substantive pro
  2. Claims pursued by the state may not be the same as those the investor would have chosen.
  3. Espousing a claim to the state has a further drawback of it becoming the home states own. The tactical decisions including the substantive propositions put forward, relief sought and the decision whether or not to settle the case are now in the hands of the state.
  4. Payment of compensation is due to the state not the investor. Damages paid are not always transferred to the investor once collected.

We select the very best solicitors in the area of Arbitration  and Heathrow law is happy to provide an initial free advice session to any States which may need to discuss an issue arising as to investments.