Abstract
A dispute between two or more countries involved in a foreign investment may arises<br />from investment agreement agreed upon by the parties. If one of the parties breaches<br />the agreement, the parties will automatically agree to resolve the dispute to the agreed<br />arbitration forum based on the dispute settlement clause on the agreement, those<br />forum such as the ICSID arbitration. Therefore, the existence of dispute settlement<br />clause on an investment agreement (Bilateral Investment Treaty) is very necessary.<br />The result of the above-mentioned arbitration proceeding is a binding and final<br />decision for the parties. An arbitral award, should contain relief or compensation<br />set by the arbitrator as the result of the proceeding. The reliefs are given as orders to<br />indemnify the damages obtained by Claimant. Issues arises when Respondent has been<br />proven to have done detrimental damage to the Claimant yet Respondent deliberately<br />neglected his/her obligation to compensate Claimant accordingly based on the relief/<br />compensation specified in the award. The non-compliance of the Respondent to<br />fulfill the compensation obligation is due to the fact that the party habitually assume<br />that the arbitration award does not have the legal force equivalent to the decision<br />of general court, even though the nature of the award is final and binding. Thus the<br />interests and rights of the Applicant who has been declared entitled to compensation<br />based on the arbitration award must be protected so that their rights can be fulfilled<br />according to the law.
Highlights
An agreement has been established when there is a consent between one party to another which is either poured down in writing or in verbal
If the compensation violates the sovereignty of the Host-State, it is possible that the award will be rejected
With the rules under the International Center of Settlements for International Dispute (ICSID) Convention and the New York Convention governing the Host-State obligation to comply with the results of the Arbitration Award, and with the existence of legal procedures, as well as diplomatic procedures that can be carried out by Foreign Investors and the Home-State, international investment law has in its capacity provided legal protection for Investors as the winning party in the international arbitration process in the event that the host-state does not comply with its obligation to provide compensation under an international arbitration award
Summary
An agreement has been established when there is a consent between one party to another which is either poured down in writing or in verbal. 205 the agreement, it is very necessary to establish a dispute settlement clause in case of any breach of contract by the parties or other dispute that causes the contract to be ineffective In those particular dispute settlement clause, the forum of arbitration is a very common alternative between business undertakers as it’s award has the nature of final and binding (Mosgan Situmorang, 2017:310). It becomes important for the author to discuss the legal procedures that can be done by the entitled party when the party required to fulfill the compensation refuses to do so According to this introduction, this article will analysis the granting of compensation by the International Investment Arbitration Forum as the form of legal protection for the disputing parties, and How the leegal protection for lack of voluntary compliance by Respondent is
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