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law to mitigate the risk of expropriation
without compensation,” Leon adds.
So where does this leave the
international investor? In a document
authored by Leon, Hannah Ambrose,
professional support consultant at
Herbert Smith Freehills, and Ernst
Müller, associate at Herbert Freehills
in Johannesburg, they state that it is
an accepted principle of international
law that a country cannot simply
implement domestic legislation to avoid
its international law obligations. Because
of this, regardless of what domestic
from USD8.3-billion to USD1.3-billion,
its annual GDP growth fell from 2.5% to
1.3%,” says Leon.
“The proposed amendment of section
25 of the Constitution — the property
clause — even while it is still being
debated, may well affect the pricing
of investment risk, which can lead
prospective as well as existing investors
to turn their attention to more hospitable
investment destinations. Existing foreign
investors, in particular, will need to
consider what rights and recourse might
be available to them under international
[18] MINING MIRROR JANUARY 2019
legislation prescribes (which includes
the Constitution), foreign investors can
still rely on the protection afforded by
the existing bilateral investment treaties
or BITs (that is, concluded between two
states) if they can show that they qualify
as ‘investors’ in terms of those treaties.
The report states that many of the BITs
include ‘sunset clauses’, which provide that
the protection afforded under the BIT
will remain in place for a specified number
of years after the BIT is terminated. As
a consequence, a foreign investor’s rights
under these treaties remain in place even
after it is terminated. Article 14 of the
BIT between the United Kingdom and
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