Most Investor-State projects involve significant capital investment, while recognizing the existence of acute risk factors. After making such investments, investors expect fiscal, regulatory, and political conditions to remain stable or favorable throughout the project's duration. However, due to the long-term nature of agreements, there have historically been significant disputes over differences in expectations versus reality. States may rapidly evolve their economies and interests, sometimes pushing for new deals seen as fairer to investors with changing circumstances. Stabilization clauses have traditionally been used by investors to protect their interests, but over time, such measures have weakened as they are perceived as a threat to the State's sovereignty. As an alternative, renegotiation is being considered as a more mutually inclusive process. This article explores the significance of renegotiation, its evolution, and the issues that need addressing for it to be an acceptable solution for all stakeholders.


Journals and Periodicals

Adler, Barry E. “Efficient Breach Theory Through the Looking Glass.” New York University Law Review 83, no. 6 (2008): 1679-1724.

Al Faruque, Abdullah. “Renegotiation and Adaptation of Petroleum Contracts: The Quest for Equilibrium and Stability.” Journal of World Investment and Trade 9, no. 2 (2008): 113-145. doi:10.1163/221190008X00124.

Berger, Klaus Peter. “Renegotiation and Adaptation of International Investment Contracts: The Role of Contract Drafters and Arbitrators.” Vanderbilt Journal of Transnational Law 36, no.4 (2003): 1347-1380.

Bouchez, Leo J. “The Prospects for International Arbitration: Disputes Between States and Private Enterprises.” Journal of International Arbitration 8, no.1 (1991): 81-115. doi:10.54648/joia1991005.

Cameron, Peter D. “Stabilization Clauses: Do They Have a Future?” BCDR International Arbitration Review 7, no. 1 (2020): 109-132.

Dias, Nelia Daniel. “Stability in International Contracts for Hydrocarbons Exploration and Some of the Associated General Principles of Law: From Myth to Reality.” Oil, Gas, and Energy Law 8, no. 4 (2010), available at www.ogel.org/article.asp?key=3053.

Gotanda, John Y. “Renegotiation and Adaptation Clauses in International Investment Contracts.” Vanderbilt Journal of Transnational Law 36 (2003): 1461-1469.

Hunter, Howard. “Commentary on ‘The Renegotiation of Contracts’” Journal of Contract Law 13, no. 3 (1998): 205-209.

Kadarisman, Abimanyu. “Disclosure of Third-Party Funding Arrangements and The Existence of Third-Party Funders in International Investment Arbitration,” Indonesian Journal of International Law 17, no. 1 (2019): 91-112. doi: 10.17304/ijil.vol17.1.779.

Konarski, Hubert. “Force Majeure and Hardship Clauses in International Contractual Practice.” International Business Law Journal 4, no. 1 (2003): 405-428.

Lopez-Rodriguez, Ana M. and Pilar Navarro. “Investment Arbitration and EU Law in the Aftermath of Renewable Energy Cuts in Spain.” European Energy & Environmental Law Review 25, no. 1 (2016): 2-10.

Marsh, Brandon. “Preventing the Inevitable: The Benefits of Contractual Risk Engineering in Light of Venezuela's Recent Oil Field Nationalization.” Stanford Journal of Law, Business and Finance 13, no. 2 (2008).

Ng’ambi, Sangwani Patrick. “Efficient and Flexible: The Case for Renegotiation Clauses in Concession Agreements,” Zambia Law Journal 45, no.1 (2014): 1-28.

Vagts, Detlev F. “Coercion and Foreign Investment Rearrangements.” American journal of International Law 72, no. 1 (1987): 17-36. doi: 10.2307/219970.

Vedeer, V. “The Lena Goldfields Arbitration: The Historical Roots of the Three Ideas.” International and Comparative Law Quarterly 47, no. 4 (1998): 747-792. doi: 10.1017/S0020589300062527.

Books and Book Chapters

Cameron, Peter D. International Energy Investment Law, The Pursuit of Stability. Oxford University Press, 2010.

Crawford, James. Brownlie’s Principles of Public International Law. Oxford University Press, 2019.

Ho, Jean. State Responsibility for Breaches of Investment Contracts, First Edition. Cambridge: Cambridge University Press, 2018.

Lowenfeld, Andreas F. International Economic Law, Second Edition. Oxford: Oxford University Press, 2008.

Muchlinski, Peter T. Multinational Enterprises and the Law, Third Edition. Oxford: Oxford University Press, 2021.

Peter, Wolfgang, Jean-Quentin de Kuyper, and Bénédict de Candolle. Arbitration and Renegotiation of International Investment Agreements, Second edition. Dordrecht: Martinus Nijhoff Publisher, 1995.

Posner, Eric A. and Alan Sykes. Economic Foundations of International Law. London: Harvard University Press, 2013.

Salacuse, Jeswald W. The Three Laws of International Investment-National, Contractual and International Frameworks for Foreign Capital, First Edition. Oxford: Oxford University Press, 2013.

Sornarajah, Muthucumaraswamy. International Commercial Arbitration: The Problem of State Contracts. New York: Longman, 1990.

Legal Documents

Vienna Convention on the Law of Treaties. 1155 UNTS 331 (opened for signature 23 May 1969, entered into force 27 January 1980).

Amoco International Finance Corporation v. The Government of the Islamic Republic of Iran & Ors, (1987) 15 Iran-US Claims Tribunal 189.

Charanne BV and Construction Investments S.A.R.L v Kingdom of Spain, SCC Case no 062/2012.

Desert Line Projects LLC v. The Republic of Yemen, ICSID Case No. ARB/05/17.

Gabcikovo-Nagumaros Project, Hungary vs Slovakia, 1997 ICJ 3.

Kuwait v. The American Independent Oil Company (AMINOIL), 21 ILM 976.

North Sea Continental Shelf, Germany v. Denmark, (1968) ICJ Rep. 9.

Railway Traffic between Lithuania and Poland, P.C.I J., Series A/B, No. 42, at 116.

Southern Pacific Properties (Middle East) Limited v. Arab Republic of Egypt, ICSID Case No. ARB/84/3.

Total S.A. v Argentine Republic (ICSID Case No. Arb/04/01).

Williams & Humbert v. W & T Trademark, (1986) AC 368.

Web Sources

Mehboob, Danish. “Vodafone v. India.” ITR Global Tax Review, 5 February 2021, accessed 5 February 2022, https://www.internationaltaxreview.com/article/2a6a800txc7nnn27smio0/itr-global-tax-50-2020-21-vodafone-v-india.

Other Sources

International Finance Cooperation. Stabilization Clauses and Human Rights, World Bank (2008). Available a

Kahale, George. “The Uproar Surrounding Petroleum Contract Renegotiations.” Oxford Energy Forum, August 2010, available at https://www.oxfordenergy.org/publications/issue-82-august-2010-2/.

Mansour, Mario and Charole Nakhle. “Fiscal Stabilization in Oil and Gas Contracts.” The Oxford Institute for Energy Studies, (2016), available at https://www.oxfordenergy.org/wpcms/wp-content/uploads/2016/02/Fiscal-Stabilization-in-Oil-and-Gas-Contracts-SP-37.pdf