The Invocation of State of Necessity Defense to justify Covid-related Measures Before International Centre for Settlement of Investment Dispute (ICSID)

Abstract

The Coronavirus Disease 2019 pandemic has forced countries to adopt a number of regulatory defensive measures, which, in turn, could negatively impact foreign investors. Therefore, many conceive that foreign investors might recourse to ICSID to initiate investor-State claims against host states under different bilateral investment treaties (hereinafter BIT). The Covid-19 pandemic has badly affected Kuwait, forcing it to adopt a national lockdown to slow down the transmission of the disease.The lockdown has remained in place for several weeks causing a number of layoff of employees, and companies to declared bankrupt. In this context, this article argues that if UCSID claims are initiated against Kuwait, Kuwait will be able to defend its Covid-19-related measures under the BIT defenses, particularly it can invoke the necessity defense through non-precluded measures provision (hereinafter NPM).