Shareholders' Claims for Reflective Loss in International Investment Law Cambridge International Trade and Economic Law Series

In recent years, investor-state tribunals have often permitted shareholders' claims for reflective loss despite the well-established principle of no reflective loss applied consistently in domestic regimes and in other fields of international law. Investment tribunals have justified their decisions by relying on definitions of 'investment' in investment agreements that often include 'shares', while the no-reflective-loss principle is generally justified on the basis of policy considerations pertaining to the preservation of the efficiency of the adjudicatory process and to the protection of other stakeholders, such as creditors. Although these policy considerations militating for the prohibition of shareholders' claims for reflective loss also apply in investor-state arbitration, they are curable in that context and must be balanced with policy considerations specific to the field of international investment law that weigh in favor of such claims: the protection of foreign investors in order to promote trade and investment liberalization.

Introduction. International investment law's narrative and shareholders' claims for reflective loss; 1. Shareholders in international investment law; 2. International investment law's shareholders' claims for reflective loss: a clash of policies; 3. Shareholders' claims for reflective loss in domestic regimes, customary international law of diplomatic protection and human rights law; 4. International investment law on the standing of shareholders; 5. Legal uncertainty and inconsistency militating against shareholders' claims for reflective loss: the unpredictability of investment disputes involving shareholders; 6. Shareholders' claims for reflective loss and the dangers of parallel proceedings; 7. International res judicata as a solution to parallel proceedings arising from shareholders' claims for reflective loss in international investment law; 8. Calculating damages in shareholders' claims for reflective loss; Conclusion; Bibliography; Index.

Lukas Vanhonnaeker is a post-doctoral fellow at the Faculty of Law, McGill University, Montréal, Canada, where he is conducting research in the field of international economic law with an emphasis on international investment law and arbitration and international corporate law.