This scenario tests the understanding of the scope of investment protection under international investment law, specifically concerning the concept of “investment” itself as defined in investment treaties and customary international law. The core issue is whether a series of short-term, opportunistic contractual arrangements, lacking the typical characteristics of an investment such as a significant commitment of capital, duration, and an expectation of return, would be recognized as an “investment” for the purposes of investor-state dispute settlement (ISDS). Alabama, like other U.S. states, has entered into various international investment agreements that define what constitutes an investment. Generally, an investment requires a contribution, a certain duration, regularity of profit, or contribution to the development of the host state, and an element of risk. The sporadic nature, lack of a dedicated asset, and the primary aim of profiting from price fluctuations rather than building a long-term enterprise weigh against classifying these transactions as an investment. The absence of a substantial commitment of resources and the speculative nature of the transactions are key factors that arbitral tribunals consider when determining the existence of an investment. Therefore, without meeting the established criteria for an investment, the investor would likely not have a valid claim under the treaty.

The core of this question revolves around the concept of “umbrella clauses” or “treaty-based international law clauses” in Bilateral Investment Treaties (BITs). These clauses, often found in Article X of a BIT, stipulate that the host state shall comply with its obligations towards the investor, not only under the treaty itself but also under other international law obligations it has assumed. This means that if a host state breaches a separate international legal obligation owed to the investor’s home state, and that breach also impacts the investment in a way that falls within the scope of the BIT, the investor can bring a claim under the BIT. For instance, if State A, through a separate treaty with State B, has an obligation to refrain from certain actions that State B’s investor is undertaking in State A, and State A breaches this obligation, potentially harming the investor’s project, the investor might be able to invoke the umbrella clause. The question posits a scenario where Alabama, as a host state, has a separate international obligation under a multilateral environmental agreement with Canada, concerning the protection of migratory bird species. A foreign investor, operating a chemical plant in Alabama, is found to be in violation of this environmental agreement, leading to a dispute. The question asks about the potential basis for the investor to bring a claim against Alabama under a hypothetical BIT between Canada and Alabama, focusing on Alabama’s breach of its international environmental obligation. The umbrella clause, by extending the scope of the BIT to cover breaches of other international law obligations, directly addresses this situation. Therefore, the investor could potentially rely on the umbrella clause within the BIT to bring a claim, as Alabama’s breach of the environmental treaty constitutes a breach of its international obligations, which is then encompassed by the BIT’s umbrella clause. This principle allows investors to leverage a broader range of international legal commitments made by the host state.

The core of this question revolves around the interpretation of the “umbrella clause” in international investment agreements, specifically how it elevates contractual obligations between a host state and an investor to treaty-level obligations. Alabama, like other US states, is bound by its federal government’s treaty obligations. When a BIT includes an umbrella clause, often referred to as a “treaty-based umbrella clause” or “all-encompassing clause,” it typically mandates that the host state shall observe all obligations it has undertaken with regard to an investment. This includes obligations arising from specific contractual agreements, permits, licenses, or undertakings given to the investor. Therefore, a breach of a contractual obligation by the host state, even if not independently a breach of a specific BIT provision like fair and equitable treatment or expropriation, can be treated as a breach of the BIT itself if the umbrella clause is broad enough. The case of Maffezini v. Kingdom of Spain is a seminal example where the umbrella clause was interpreted to encompass contractual breaches. The question asks for the legal mechanism that allows a breach of a contractual obligation to be considered a breach of the investment treaty. This mechanism is the direct incorporation of contractual obligations into the treaty’s scope through the umbrella clause, making the treaty itself the basis for the claim.

The scenario presented involves a potential breach of a bilateral investment treaty (BIT) between the fictional nation of Veridia and the United States, specifically concerning an investment made by an American company, “Alabaster Industries,” in Veridia. The core issue is whether Veridia’s imposition of a temporary, sector-specific export ban on raw timber, ostensibly to combat illegal logging and protect its nascent reforestation efforts, constitutes an unlawful expropriation under international investment law. To determine this, we must analyze the concept of indirect expropriation. Indirect expropriation, unlike direct expropriation where the state physically seizes an asset, occurs when state measures, while not directly seizing property, nevertheless deprive the investor of the fundamental economic use and enjoyment of their investment to such an extent that it is tantamount to a taking. Key factors in assessing indirect expropriation include the character of the measure, its economic impact on the investor, and whether the measure interferes with legitimate expectations. In this case, Alabaster Industries, which has a significant investment in timber harvesting and export in Veridia, is directly impacted by the export ban. The ban, even if temporary and for a stated public purpose, could be argued to deprive Alabaster Industries of the substantial economic benefit derived from exporting its primary product. However, international investment law also recognizes the inherent right of states to regulate in the public interest, even if such regulations have an adverse economic impact on foreign investors. This right is often balanced against the investor’s right to protection from unlawful expropriation. The crucial element here is whether the measure is “disproportionate” or “unreasonable” in its impact, or if it goes beyond what is necessary to achieve Veridia’s stated environmental goals. A measure that is non-discriminatory, transparent, and enacted for a genuine public purpose (like environmental protection) is less likely to be considered an unlawful expropriation, especially if it is temporary and accompanied by measures to mitigate its impact or provide compensation. However, if the ban is found to be arbitrary, discriminatory against foreign investors, or excessively burdensome without adequate justification or compensation, it could be deemed an indirect expropriation. The question asks about the most appropriate legal characterization of Veridia’s action. Considering the principles of indirect expropriation and the state’s right to regulate, a measure that significantly impairs an investment’s economic viability, even if for a public purpose, can be characterized as expropriatory if it lacks proportionality or fails to meet the standards of fair and equitable treatment, which often includes respecting legitimate expectations. The export ban, by directly preventing the core economic activity of Alabaster Industries, likely crosses this threshold if it is not carefully tailored and justified. Therefore, characterizing it as a potential indirect expropriation, requiring further examination of its proportionality and the existence of a public purpose defense, is the most accurate legal assessment. The calculation is conceptual, focusing on the application of legal principles rather than a numerical outcome. The core logic is that the state’s action has a severe economic impact on the investor, which, if not properly justified under exceptions, can be classified as expropriation.

The core issue revolves around the concept of “umbrella clauses” or “creeping expropriation” within the context of international investment law, specifically as interpreted through the lens of the Alabama-Germany Bilateral Investment Treaty (BIT). The scenario describes actions by the State of Alabama that, while not a direct seizure of assets, cumulatively diminish the value and control of the German investor’s hydroelectric dam project. These actions, such as imposing stringent and unforeseen environmental regulations, revoking previously granted permits without clear justification, and imposing a sudden, disproportionate tax increase specifically targeting renewable energy infrastructure, can be construed as indirect expropriation if they deprive the investor of substantially all economic benefit or control over their investment. The principle of “fair and equitable treatment” (FET), a cornerstone of most BITs, is often invoked in such cases. FET encompasses a spectrum of protections, including the state’s duty to act in good faith, provide transparency, and not frustrate the investor’s legitimate expectations. The arbitrary and burdensome nature of Alabama’s regulatory and fiscal measures, particularly when they appear to target a specific foreign investment without a clear, overriding public policy rationale that is applied non-discriminatorily, could be seen as a violation of FET. The concept of “legitimate expectations” is crucial here; if the German investor reasonably relied on the stability of the regulatory framework and the predictability of tax policies when making its investment, and Alabama’s actions fundamentally alter this predictability, it strengthens the claim for a breach. The question probes the student’s understanding of how a pattern of seemingly disparate state actions can collectively amount to a breach of investment protection standards under a BIT, even in the absence of overt nationalization. The correct answer identifies the most encompassing legal basis for a claim under the BIT, considering the cumulative impact of Alabama’s actions.

The core issue here revolves around the interpretation of “expropriation” within the framework of international investment law, specifically concerning indirect expropriation. Indirect expropriation occurs when a host state’s actions, while not a direct seizure of an investment, nonetheless deprive the investor of the substantial benefits of ownership, effectively amounting to a taking. This often involves regulatory measures that significantly diminish the economic value or control of the investment. Key to determining if a regulatory measure constitutes indirect expropriation is the assessment of its proportionality, the investor’s legitimate expectations, and whether the measure was taken for a public purpose and under due process. Alabama, like other U.S. states, is bound by international investment agreements to which the United States is a party, and its regulatory actions are subject to scrutiny under these treaties. In this scenario, the state’s stringent environmental regulations, while ostensibly for public health and safety, have rendered the industrial park financially unviable for the foreign investor. The regulations do not target the investor specifically but are broad in scope. However, their impact is so severe that it effectively extinguishes the economic purpose of the investment. The critical factor is whether these regulations, despite their general application and public purpose, go beyond what a reasonable state could enact without triggering a compensable taking under international investment law. This involves balancing the state’s sovereign right to regulate in the public interest against the investor’s right to protection from measures that, in effect, confiscate their investment without adequate compensation. The question tests the understanding that even non-discriminatory, generally applicable regulations can constitute indirect expropriation if their impact is sufficiently severe and undermines the fundamental economic viability of the investment, especially when coupled with a lack of transparency or a deviation from established regulatory norms that fostered the investment. The calculation, in this context, is not a numerical one but rather a qualitative assessment of the regulatory impact against established international legal standards for expropriation. The answer reflects the principle that a severe, disproportionate regulatory impact, even without direct confiscation, can constitute expropriation.

The core of this question lies in understanding the nuanced application of the “umbrella clause” or “treaty override” provision within an investment treaty, specifically in the context of Alabama’s international investment agreements. An umbrella clause typically obligates a host state to observe obligations it has entered into with respect to an investment. This means that if Alabama, through a separate agreement or commitment (e.g., a specific regulatory assurance or a concession agreement with an investor), breaches a distinct international obligation concerning that investment, the umbrella clause can be invoked to bring that breach under the purview of the investment treaty’s dispute settlement mechanism. The question posits a scenario where Alabama enters into a separate, non-investment treaty agreement with a foreign investor concerning environmental standards for a new manufacturing facility. Subsequently, Alabama enacts legislation that directly contravenes the specific environmental commitments made in that separate agreement. This breach of a distinct, treaty-based obligation concerning the investment is precisely what an umbrella clause is designed to capture. Therefore, an investor could likely bring a claim under the umbrella clause of an applicable Bilateral Investment Treaty (BIT) between the investor’s home country and the United States, arguing that Alabama’s new legislation violates the broader obligation to respect all commitments made to the investor, including those in the separate environmental agreement. The challenge for the investor is to demonstrate that the separate environmental agreement constitutes an “obligation” that Alabama has “entered into with respect to an investment” and that the subsequent legislation constitutes a breach of that specific obligation, thereby triggering the treaty’s dispute resolution provisions. The question is not about whether Alabama has the right to regulate environmental standards, but whether its specific legislative action violates a prior, distinct international commitment made concerning the investment that is covered by the umbrella clause.

The question revolves around the interpretation of “indirect expropriation” within the framework of international investment law, specifically concerning the Alabama-Aethelred Bilateral Investment Treaty (BIT). Indirect expropriation, also known as regulatory expropriation, occurs when a host state’s actions, though not a direct seizure of an investment, effectively deprive the investor of the substantial use, enjoyment, or value of their investment. Key factors in determining indirect expropriation include the severity of the interference, the duration of the measure, the investor’s reasonable expectations, and whether the measure served a public purpose without discriminatory intent. In the scenario presented, the Alabama government’s imposition of stringent environmental regulations on the chemical manufacturing plant owned by Aethelred Industries, a foreign investor, led to a significant reduction in its operational capacity and profitability. While the regulations were ostensibly for public health and environmental protection, the analysis must consider whether these measures went beyond legitimate regulatory action and constituted an expropriatory interference. The core of the legal determination lies in whether the regulations, in their application and effect, effectively stripped Aethelred of the essential economic benefits of its investment. A crucial element in assessing indirect expropriation is the concept of “legitimate expectations.” If Aethelred had a reasonable expectation, based on prior assurances or the regulatory environment at the time of investment, that its operations would continue without such drastic, unforeseen limitations, this strengthens its claim. However, the Alabama government’s right to regulate in the public interest, particularly concerning environmental protection, is also a significant factor. The determination hinges on whether the regulatory action was a bona fide exercise of police power or a disguised means of achieving an expropriatory outcome. The calculation of compensation, if expropriation is found, would typically involve determining the fair market value of the investment immediately before the expropriation occurred. This often includes lost profits and other damages directly attributable to the unlawful measure. However, the question asks about the *threshold* for finding indirect expropriation, not the quantum of damages. The correct option hinges on the principle that regulatory actions can amount to indirect expropriation if they are so severe as to deprive the investor of the substantial use, enjoyment, or value of their investment, irrespective of whether the state intended to expropriate. This is often referred to as the “substantial deprivation” test. The Alabama government’s actions, by severely curtailing operations and profitability, could meet this threshold if the interference is deemed excessive and not a proportionate exercise of regulatory power.

The core of this question revolves around the concept of legitimate expectations in international investment law, particularly as it relates to the fair and equitable treatment (FET) standard. FET is a broad and evolving standard that generally encompasses a host state’s obligation to treat foreign investors in a manner that is consistent with international law. This includes providing stability and predictability in the investment climate. Legitimate expectations are often formed by representations made by the host state to the investor, such as those found in investment agreements, official statements, or regulatory pronouncements. When a host state subsequently acts in a way that frustrates these established expectations, it can be considered a breach of FET. In this scenario, the Alabama Department of Environmental Quality’s (ADEQ) initial assurances regarding the streamlined permitting process, coupled with the subsequent imposition of significantly more burdensome and unforeseen requirements, directly undermines the predictability and stability the investor, “AquaGen Renewables,” reasonably relied upon. The change in regulatory approach, without a clear and justifiable public interest rationale that outweighs the investor’s established expectations, points towards a violation of the FET standard. The fact that Alabama has entered into various bilateral and multilateral investment treaties that incorporate such standards is crucial. While specific calculations are not involved, the assessment hinges on the qualitative impact of the state’s actions on the investor’s reasonable expectations. The subsequent regulatory changes, creating a de facto prohibition on the project through insurmountable hurdles, directly contravene the initial representations that formed the basis of AquaGen’s investment decision. This failure to provide a stable and predictable regulatory environment, and the frustration of the investor’s legitimate expectations derived from state assurances, constitutes a breach of the fair and equitable treatment standard, a cornerstone of international investment protection.

The question pertains to the principle of “legitimate expectations” within international investment law, specifically how it interacts with a host state’s regulatory autonomy. Legitimate expectations are often invoked by investors when a host state alters its policies or regulations in a way that negatively impacts an investment, even if the alteration is not a direct expropriation. This concept is closely tied to the broader principle of fair and equitable treatment (FET), which is a cornerstone of most Bilateral Investment Treaties (BITs) and multilateral investment agreements. When a state makes specific commitments or representations to an investor, creating a clear expectation of a certain regulatory environment, and then deviates from these without adequate justification or compensation, it can be seen as a breach of legitimate expectations. This does not grant investors a perpetual shield against all regulatory changes, as states retain the right to regulate in the public interest, provided such regulations are applied non-discriminatorily, are not arbitrary, and are accompanied by appropriate compensation if they amount to indirect expropriation. The challenge lies in balancing the investor’s reliance on prior assurances with the state’s inherent sovereign right to adapt its legal and economic framework to evolving societal needs, such as environmental protection or public health. The concept of proportionality is crucial here; regulatory actions must be proportionate to the public interest objective they seek to achieve. Alabama, like other U.S. states, is bound by the investment provisions of treaties to which the United States is a party, meaning its regulatory actions are subject to international scrutiny under these principles.

The question probes the interplay between a host state’s regulatory autonomy and the substantive protection afforded to foreign investors under international investment law, specifically focusing on the concept of “legitimate expectations.” Legitimate expectations, in this context, are generally understood to arise from specific representations or assurances made by the host state to an investor, which can modify or supplement the general protections provided by a treaty. When a state alters its regulatory framework, it must consider whether such changes frustrate legitimate expectations created by prior governmental actions or statements. The principle of fair and equitable treatment (FET) often incorporates this element. In the scenario presented, the State of Alabama, through its Department of Environmental Quality (ADEQ), issued a permit to Solara Innovations for a solar energy project, explicitly stating that the permit would remain valid for 25 years, subject to compliance with stipulated environmental standards. This explicit assurance, coupled with Solara’s subsequent substantial investment in specialized equipment and infrastructure based on this permit’s duration, creates a legitimate expectation of regulatory stability for that period. Subsequently, Alabama enacts a new statute mandating a review and potential revocation of all existing solar energy permits after 10 years, irrespective of compliance with original conditions. This action directly contradicts the assurance given in the permit. While states retain the sovereign right to regulate in the public interest, this right is not absolute and is constrained by international investment treaty obligations, including the FET standard. The new statute, by arbitrarily shortening the permit’s validity and overriding the prior specific assurance without demonstrating overriding public necessity or offering fair compensation, is likely to be viewed as a breach of Alabama’s obligations to Solara under a hypothetical bilateral investment treaty (BIT) that includes FET provisions. The calculation of damages, if a dispute were to arise, would involve assessing the loss incurred by Solara due to the premature revocation of its permit. This would typically include lost profits over the remaining 15 years of the original permit term, the unamortized capital expenditure, and potentially other consequential damages. For instance, if Solara’s projected annual profit was $5 million and its remaining unamortized capital expenditure was $50 million, the total compensation could be estimated as \(15 \text{ years} \times \$5 \text{ million/year} + \$50 \text{ million}\), which equals $125 million. This calculation is illustrative of how a tribunal might approach quantifying the economic harm stemming from the breach of legitimate expectations. The core legal issue is whether Alabama’s regulatory action was a legitimate exercise of sovereign power or a breach of its international investment commitments due to the frustration of Solara’s legitimate expectations.

The question asks to identify the most appropriate legal basis for an investor to challenge a state’s regulatory action that diminishes the value of its investment, considering the specific context of Alabama’s potential adherence to international investment norms. Alabama, as a state within the United States, is generally bound by federal law regarding international agreements. While the U.S. has entered into numerous Bilateral Investment Treaties (BITs) and Free Trade Agreements (FTAs) with investment protection chapters, these are federal instruments. Therefore, an investor would typically seek recourse under these federal agreements. The concept of “legitimate expectations” is a key component of the Fair and Equitable Treatment (FET) standard, which is a cornerstone of most modern investment treaties. FET obligations often encompass protection against arbitrary or discriminatory regulatory actions that frustrate an investor’s reasonable expectations formed based on representations made by the host state. The specific wording of the BIT or FTA would govern the precise scope of this protection. The challenge arises in determining if Alabama’s actions, undertaken by a state entity, constitute a breach of the host state’s obligations under an applicable international investment agreement, which would be interpreted and enforced at the federal level. Options referring to purely domestic Alabama law without an international nexus, or to general principles of international law not specifically incorporated into an investment treaty, would be less direct or applicable in this context. The prompt implies a scenario where Alabama’s regulatory action is being scrutinized under international investment law principles.

The scenario presented involves a foreign investor, “Aethelred Holdings,” established in the United Kingdom, making a direct investment in a renewable energy project within Alabama. Alabama, as a host state, enacts new environmental regulations that significantly impact the operational feasibility and profitability of Aethelred’s project. The core of the legal question revolves around whether these new regulations constitute an indirect expropriation under the most-favored-nation (MFN) treatment standard, as stipulated in a hypothetical Bilateral Investment Treaty (BIT) between the United States and the United Kingdom. To determine this, we must first understand the concept of indirect expropriation in international investment law. Indirect expropriation occurs when a host state’s actions, while not directly seizing an investment, have a similar effect by substantially depriving the investor of the economic value or control of their investment. This often involves regulatory measures that, while ostensibly for a public purpose, disproportionately burden foreign investors. The most-favored-nation (MFN) treatment standard, a cornerstone of many BITs, requires a host state to treat investors from one contracting state no less favorably than it treats investors from any third country. In this context, if Alabama’s new environmental regulations, enacted after the BIT came into force, impose a significantly harsher burden on Aethelred Holdings (a UK investor) compared to domestic investors or investors from other countries not party to a similar BIT with the US, it could potentially violate the MFN principle. The key question is whether the *effect* of Alabama’s regulations on Aethelred, when compared to the treatment of other investors (particularly domestic ones, or those from states with less stringent environmental regulations or different treaty protections), rises to the level of an indirect expropriation. This would likely be assessed based on factors such as the extent of the economic deprivation, the regulatory intent, the proportionality of the measure to its stated public purpose, and whether the measure is discriminatory in effect. If the regulations, when applied to Aethelred, are more burdensome than those applied to comparable domestic investors or investors from other nations, and this burden substantially diminishes the investment’s value or control, then it could be argued as a breach of the MFN standard, leading to a claim for compensation. The absence of a specific carve-out for environmental regulations in the hypothetical BIT, or the lack of a clear “police powers” exception that would shield such measures from scrutiny, would strengthen Aethelred’s position. The question tests the understanding of how regulatory actions by a sub-national entity like Alabama can trigger international investment treaty obligations and how the MFN clause operates in such scenarios, particularly concerning indirect expropriation.

The question probes the nuanced interplay between a host state’s regulatory autonomy and the substantive protection standards typically found in Bilateral Investment Treaties (BITs), specifically focusing on the concept of “fair and equitable treatment” (FET). The scenario presents Alabama, as a host state, enacting a new environmental regulation that impacts an existing foreign investment in renewable energy. The core issue is whether this new regulation, even if enacted in good faith for public welfare, could constitute a breach of the FET standard if it substantially alters the investment’s economic viability or regulatory stability, thereby frustrating the investor’s legitimate expectations. Alabama, like any sovereign state, retains the right to regulate in the public interest, including environmental protection. However, international investment law, as embodied in BITs, often tempers this right. The FET standard is a broad and evolving concept that generally requires a host state to treat foreign investors and their investments in a manner that is not arbitrary, discriminatory, or unjust. It encompasses the protection of an investor’s legitimate expectations, which are often shaped by the legal and regulatory framework in place at the time of investment. If Alabama’s new environmental regulation was introduced without adequate notice, disproportionately impacts the foreign investment compared to domestic investments, or fundamentally undermines the economic basis of the investment without providing just compensation, it could be argued to violate the FET. The key is not the mere existence of the regulation, but its effect on the investment and whether it breaches the underlying principles of fairness and equity expected by investors under the treaty. The question requires an understanding that while regulatory space exists, it is not absolute when international investment protections are engaged. The correct answer hinges on recognizing that a legitimate exercise of regulatory power that significantly and detrimentally alters the investment’s value or operational framework, without proper justification or compensation, can indeed fall foul of FET obligations, even if the state’s intent was public welfare. The absence of a specific compensation provision in the hypothetical BIT for regulatory changes does not automatically shield Alabama from liability if the action is deemed to violate FET.

The question probes the nuanced application of the most-favored-nation (MFN) treatment standard within the context of international investment law, specifically as it might be interpreted in an Alabama-centric BIT. MFN treatment, a cornerstone of investment protection, generally obligates a contracting state to grant to investors of another contracting state treatment no less favorable than that which it accords to investors of any third state. In this scenario, Alabama, as the host state, has a BIT with Country X that contains an MFN clause. Alabama subsequently enters into a new BIT with Country Y, which includes provisions for a lower threshold for proving indirect expropriation than the original BIT with Country X. The core issue is whether the more favorable standard for indirect expropriation in the Alabama-Country Y BIT can be extended to investors from Country X via the MFN clause in the Alabama-Country X BIT. The principle of MFN, when interpreted to encompass substantive protections, would indeed allow for the application of the more lenient standard for indirect expropriation from the Country Y agreement to investors from Country X, provided that the MFN clause in the Country X BIT is interpreted broadly to cover such substantive standards and does not contain specific carve-outs or limitations that would exclude this type of benefit. The Alabama-Country X BIT’s MFN clause, if it is a standard, comprehensive provision, would require Alabama to extend any treatment accorded to investors of Country Y that is more favorable than that accorded to investors of Country X. The lower threshold for indirect expropriation in the Alabama-Country Y BIT is precisely such a more favorable treatment. Therefore, investors of Country X, under the MFN principle, would be entitled to benefit from this more favorable standard, effectively lowering the burden of proof for them in demonstrating indirect expropriation. The calculation or determination here is not numerical but rather a legal interpretation of treaty obligations. The Alabama-Country X BIT’s MFN clause is the operative instrument, and its scope, when read in conjunction with the Alabama-Country Y BIT’s provisions, dictates the outcome. If the MFN clause is interpreted to cover substantive protections and does not have exclusionary language, the benefit of the more favorable standard for indirect expropriation from the Country Y treaty is extended to Country X investors. This ensures that Alabama provides no less favorable treatment to investors of Country X compared to investors of Country Y, as per the MFN obligation.

The core issue revolves around the interpretation of “fair and equitable treatment” (FET) in the context of a host state’s regulatory changes that impact an investment. Specifically, the question probes whether a change in environmental regulations, even if enacted in good faith and for a legitimate public purpose like protecting the Coosa River’s ecosystem, can constitute a breach of FET if it significantly undermines the investor’s legitimate expectations formed at the time of investment. Alabama, as a host state, retains its sovereign right to regulate in the public interest. However, international investment law, as reflected in many Bilateral Investment Treaties (BITs) and customary international law, imposes certain obligations on states when they exercise this regulatory power, particularly concerning foreign investors. The FET standard is widely understood to encompass a range of protections, including the protection of legitimate expectations. If an investor made an investment based on a stable regulatory environment, and the host state then introduces new, burdensome regulations that were not foreseeable or that fundamentally alter the investment’s viability without adequate compensation or a clear transitional period, this could be construed as a violation of FET. The concept of “expropriation” is also relevant, as regulatory actions that deprive an investor of the economic value of their investment can be considered indirect expropriation, requiring compensation. However, the question hinges on the *manner* of regulation and its impact on legitimate expectations, not merely the existence of regulation. The critical element is whether the regulatory change was arbitrary, discriminatory, or lacked transparency, or if it frustrated expectations that the host state had implicitly or explicitly fostered. A state’s good faith in enacting regulations is a factor, but it does not automatically shield it from liability if the impact on the investor’s legitimate expectations is severe and uncompensated. The Alabama Department of Environmental Management’s actions, while potentially serving a valid environmental purpose, must be assessed against the specific obligations Alabama has undertaken through its international investment agreements. The question requires an understanding that FET is not a static concept and can be breached by regulatory actions that, while seemingly neutral, have a disproportionate and detrimental impact on an investor’s reasonable expectations. The scenario highlights the tension between a state’s right to regulate for public welfare and its international obligations to provide a stable and predictable investment environment.

The question probes the nuanced understanding of the “umbrella clause” within international investment treaties, specifically its interpretation and application in investor-state dispute settlement (ISDS). The umbrella clause, often found in Bilateral Investment Treaties (BITs), obliges the host state to observe obligations it has undertaken with regard to an investment. This means that if a host state breaches an obligation it has contractually agreed to with an investor, and that contract is incorporated by reference or otherwise falls within the scope of the umbrella clause, the state’s breach of the contract can be treated as a breach of the BIT itself. This allows the investor to bring an ISDS claim under the BIT, rather than being limited to domestic contractual remedies. The key is that the breach must be of an obligation *undertaken with regard to the investment*. This is distinct from a breach of general domestic law, unless that domestic law itself is the manifestation of a specific undertaking to the investor. The scenario describes a situation where the State of Alabama enters into a concession agreement with a foreign investor for the development of a new port facility. This agreement contains specific performance standards and dispute resolution mechanisms. Subsequently, Alabama enacts a new environmental regulation that, while generally applicable, makes it commercially unviable for the investor to operate the port as stipulated in the concession agreement. The investor claims this constitutes a breach of the “umbrella clause” in the BIT between the investor’s home state and the United States, which Alabama is bound by. The core issue is whether the general environmental regulation, which impacts the concession agreement, is a breach of an obligation *undertaken with regard to the investment* as contemplated by the umbrella clause, or if it’s an exercise of sovereign regulatory power. Arbitral tribunals have varied in their interpretation, but a common approach is to examine if the state’s action undermines the specific commitments made in the concession agreement, thereby treating the concession agreement as an undertaking that the umbrella clause protects. If the environmental regulation directly contradicts or frustrates the core obligations of the concession agreement, and the BIT contains an umbrella clause, the investor could potentially bring a claim. The question asks for the most likely outcome given the typical application of such clauses. The correct answer hinges on the understanding that the umbrella clause is designed to protect specific international commitments made by the host state to the investor, including contractual obligations. When a state’s general regulatory action directly impedes the performance of a specific contract it entered into with an investor, and that contract is considered an “undertaking with regard to the investment,” the umbrella clause can be invoked. This is not about the state losing its regulatory power, but about the state being held accountable for breaches of its *specific* international undertakings. Therefore, if the concession agreement is interpreted as a specific undertaking to the investor, and the environmental regulation effectively prevents Alabama from fulfilling its contractual obligations within that agreement, an ISDS claim under the umbrella clause is a plausible, and often successful, avenue for the investor.

The core issue revolves around the interpretation of “expropriation” under an international investment treaty, specifically concerning indirect expropriation through regulatory action. In the hypothetical scenario, the state of Alabaster enacts a stringent environmental regulation that, while ostensibly for public welfare, has a devastating impact on the profitability and viability of a foreign investor’s agricultural operations. The key to determining if this constitutes expropriation lies in assessing whether the regulation has effectively deprived the investor of substantially all use and enjoyment of their investment, or at least the fundamental economic value of it, without providing prompt, adequate, and effective compensation. In international investment law, indirect expropriation, often referred to as regulatory expropriation, occurs when a state’s actions, though not a direct seizure of property, have a similar effect. This is assessed through a multifactorial analysis, often considering the severity of the economic impact, the state’s intent, and whether the measure was arbitrary or discriminatory. For instance, if the regulation is found to be a pretext for achieving an ulterior motive, or if it disproportionately burdens the foreign investor compared to domestic investors, it strengthens the claim of expropriation. Furthermore, the concept of “legitimate expectations” plays a crucial role. If the investor relied on prior assurances or a stable regulatory environment in making their investment, and the new regulation drastically undermines those expectations, this can be a significant factor. The absence of compensation for such a severe economic impact, especially if the regulation is seen as going beyond the state’s legitimate regulatory authority and effectively destroying the investment’s value, would likely lead to a finding of expropriation. The calculation here is not a numerical one, but rather an analytical assessment of the facts against established legal principles of indirect expropriation. The question requires an understanding of the nuances between legitimate state regulation and measures that constitute an unlawful taking of property under international investment law. The relevant legal principles include the prohibition of expropriation without compensation, the distinction between direct and indirect expropriation, and the assessment of whether a state has acted within its regulatory autonomy or exceeded it in a manner that violates international investment obligations. The hypothetical case of Alabaster’s environmental regulation necessitates an examination of whether the state’s action, even if motivated by public interest, crossed the threshold into an expropriatory act by effectively destroying the economic viability of the investment without due process or compensation.

The core of this question lies in understanding the concept of indirect expropriation within international investment law, specifically as it relates to regulatory actions by a host state. Indirect expropriation occurs when a host state’s actions, while not directly seizing an investor’s property, nonetheless deprive the investor of the substantial use, enjoyment, or value of their investment to such an extent that it is tantamount to direct expropriation. The standard for determining indirect expropriation often involves a balancing act between the state’s right to regulate in the public interest and the investor’s right to protection against measures that effectively extinguish the economic value of their investment. Key factors considered include the severity of the interference, whether the measures were discriminatory, whether they were taken for a public purpose, and whether they were accompanied by adequate compensation. In the given scenario, the Alabama Department of Environmental Protection’s (ADEP) stringent new regulations on wastewater discharge, which render the existing filtration system of the German solar panel manufacturing plant economically unviable and require a complete, prohibitively expensive overhaul, significantly impair the plant’s operational capacity and profitability. While the state did not seize the plant or its assets directly, the economic impact of the regulations effectively destroys the value of the investment as it was conceived and operated. This level of interference, particularly if the regulations are deemed disproportionate to the environmental harm they aim to address or if they were implemented without adequate consideration for existing investments, could be interpreted as an indirect expropriation. The absence of compensation for the substantial economic loss further strengthens the argument for indirect expropriation. Therefore, the most accurate characterization of the legal situation, from the perspective of international investment law, is that the German investor likely has a claim for indirect expropriation.

The core of this question lies in understanding the concept of “umbrella clauses” or “treaty override” in international investment law, particularly as it relates to the interaction between a Bilateral Investment Treaty (BIT) and a host state’s domestic law. An umbrella clause, typically found in Article X of a BIT, obligates the host state to observe all obligations it has assumed towards the investor, whether by treaty, contract, or domestic law. When a host state breaches a contractual obligation it owes to an investor, and that breach also violates a provision of the BIT (such as the fair and equitable treatment standard), the umbrella clause allows the investor to bring a claim under the BIT for the breach of contract, effectively elevating the contractual dispute to the international investment law plane. This is distinct from a direct breach of the BIT’s substantive provisions. The question asks for the most appropriate basis for an international investment claim in this scenario. The breach of the contractual obligation to pay is also a breach of the host state’s obligation under the umbrella clause to observe all commitments made to the investor. Therefore, the claim is grounded in the host state’s failure to uphold its treaty obligation as defined by the umbrella clause, which encompasses the contractual commitment. Alabama’s investment treaties and domestic laws would be interpreted in light of this general principle of international investment law. The other options are less precise. A direct claim for breach of contract would typically be pursued in domestic courts unless the contract itself provided for international arbitration. While the contract breach is the factual predicate, the *basis* for the international claim is the treaty provision. A claim solely for breach of the fair and equitable treatment standard might be arguable if the contractual breach demonstrably violated FET, but the umbrella clause provides a more direct and encompassing basis for claims arising from breaches of contractual commitments. A claim for breach of the specific payment terms of the contract, without reference to the treaty, would not be an international investment law claim.

The question probes the nuanced application of the most-favored-nation (MFN) treatment principle within the context of international investment law, specifically as it might interact with Alabama’s domestic regulatory framework. MFN treatment, a cornerstone of investment treaties, generally obligates a host state to grant investors of one treaty partner treatment no less favorable than that accorded to investors of any third country. However, the scope and limitations of MFN are critical. In this scenario, Alabama has a pre-existing bilateral investment treaty (BIT) with Nation X that provides a specific, perhaps less stringent, standard for expropriation compensation. Later, Alabama enters into a new BIT with Nation Y, which contains a more investor-favorable expropriation clause. The investor from Nation X, whose investment in Alabama is subsequently expropriated, seeks to benefit from the more favorable compensation terms found in the Alabama-Nation Y BIT, invoking the MFN clause in their own treaty. The core legal question is whether an MFN clause in a BIT can be used to import provisions from a *later* treaty into an *earlier* one, thereby elevating the standard of protection for the investor from Nation X. Generally, MFN clauses are interpreted to apply to third countries that are parties to treaties *contemporaneous* with or *prior* to the treaty in which the MFN clause is found, or as otherwise specified in the MFN clause itself. The principle of non-retroactivity in treaty interpretation and the specific wording of the MFN provision are paramount. Unless the Alabama-Nation X BIT explicitly allows for the importation of provisions from subsequent treaties, or if the MFN clause is drafted in a manner that clearly permits such a broad application, the investor from Nation X would typically be bound by the expropriation compensation standards established in their own treaty with Alabama. The Alabama-Nation Y BIT’s terms would not automatically flow to the investor from Nation X through the MFN clause of the older treaty. This interpretation upholds the principle that treaty rights and obligations are generally governed by the terms of the specific treaty in force between the parties at the time of the dispute, and that MFN clauses, while powerful, are not unlimited conduits for importing all provisions from any other treaty.

The core of this question revolves around the concept of “legitimate expectations” within the framework of international investment law, specifically as it pertains to the Fair and Equitable Treatment (FET) standard. Legitimate expectations are generally understood to arise from representations made by the host state to the investor that create a reasonable belief in a certain treatment or outcome. These representations can manifest in various forms, including public statements, assurances, specific commitments in investment agreements, or even the consistent application of domestic law. The tribunal in the case of *Mesa Power Group, LLC v. Government of Canada* (a hypothetical but illustrative scenario for this question) would analyze the actions and pronouncements of the Alabama state government concerning the development of a renewable energy project. If Alabama officials, through official channels or published policy documents, explicitly assured foreign investors that a specific regulatory framework would remain stable for the duration of their investment, and this assurance was a material factor in the investor’s decision to commit capital, then a subsequent, unexpected regulatory change that significantly undermines the investment could be considered a breach of FET. The key is to establish a direct causal link between the state’s representations and the investor’s detrimental reliance, leading to a violation of the legitimate expectation of a stable regulatory environment. This contrasts with general policy pronouncements or the inherent right of a state to regulate, which do not typically create specific legitimate expectations. The assessment would focus on the clarity, specificity, and context of the state’s assurances, and whether the investor’s expectation was objectively reasonable given these assurances.

The question concerns the interpretation of the “fair and equitable treatment” (FET) standard in international investment law, specifically in the context of regulatory changes by a host state. Alabama, as a hypothetical host state, enacts a new environmental regulation that significantly impacts an existing foreign investment. The core of the FET standard, as developed through arbitral jurisprudence, often includes the concept of “legitimate expectations.” This means that investors are entitled to rely on a stable and predictable legal and regulatory environment, absent unforeseeable and arbitrary changes. When a host state introduces a measure that fundamentally alters the basis upon which an investment was made, and this change is not applied transparently or with due process, it can be considered a breach of FET. In this scenario, Alabama’s sudden and undisclosed regulatory shift, which directly frustrates the investment’s profitability and operational viability without a clear public policy justification or compensatory mechanism, would likely be viewed by an arbitral tribunal as a violation of the investor’s legitimate expectations, a key component of FET. The absence of a transitional period or a clear rationale for the abruptness of the change further strengthens the argument for a breach. This analysis hinges on the principle that FET requires a degree of legal certainty and predictability for foreign investors, protecting them from arbitrary governmental actions that undermine their investment. The explanation does not involve any calculations.

The question revolves around the concept of “legitimate expectations” within the framework of international investment law, specifically as it applies to a hypothetical scenario involving a foreign investor in Alabama. Legitimate expectations, a key component of the Fair and Equitable Treatment (FET) standard, arise when a host state’s actions or representations lead an investor to reasonably anticipate a certain regulatory or legal environment. These expectations are often shaped by specific assurances, representations, or a consistent pattern of administrative conduct. In this case, the Alabama Department of Environmental Quality’s (ADEQ) prior approvals and consistent issuance of permits for similar waste disposal operations, coupled with the investor’s substantial investment based on these prior dealings, create a foundation for legitimate expectations. The subsequent, abrupt change in policy and denial of a permit renewal, without prior warning or a clear, prospective regulatory shift communicated to existing operators, could be interpreted as a breach of FET. This is because it undermines the stability and predictability that investors are entitled to under international investment agreements. The investor’s reliance on the established administrative practice and the significant capital expenditure in Alabama, anticipating continued operation under similar conditions, forms the basis of their claim. The denial of renewal, when the facility was otherwise compliant with existing regulations, suggests a lack of fair and equitable treatment, particularly if the new policy was applied retroactively or in an arbitrary manner without due process or adequate compensation for the disruption of established expectations. This principle is crucial in ensuring that host states do not arbitrarily alter the investment climate in a way that prejudices foreign investors who have acted in good faith and in reliance on prior governmental conduct. The absence of a clear, prospective, and uniformly applied regulatory change that would necessitate such a denial supports the argument for a breach of legitimate expectations.

The scenario describes a situation where a foreign investor in Alabama claims that a new state environmental regulation, designed to protect the Mobile Bay estuary, constitutes an indirect expropriation. The investor argues that this regulation significantly reduces the profitability of their existing port infrastructure development project, which was based on prior, less stringent environmental standards. International investment law, particularly through Bilateral Investment Treaties (BITs) and customary international law, provides protection against expropriation. Expropriation can be direct (outright seizure of assets) or indirect (measures that have a similar effect). For an indirect expropriation claim to succeed, the investor typically needs to demonstrate that the state’s measure deprived them of the economic use and enjoyment of their investment, going beyond mere regulatory interference. Key considerations include whether the measure was non-discriminatory, served a public purpose, and whether compensation was offered. In this case, Alabama’s regulation is a general environmental measure, not targeted at a specific investor. However, the magnitude of the economic impact on the investor’s project is crucial. If the regulation effectively renders the investment valueless or unusable for its intended purpose, it could be considered an indirect expropriation. The principle of “legitimate expectations” is also relevant; if the investor reasonably relied on the prior regulatory regime when making their investment, and the new regulation frustrates those expectations without adequate justification or compensation, the claim gains strength. The investor would need to prove that the economic impact is so severe as to amount to a deprivation of their property rights under international law, rather than a mere diminution in value or a burden associated with legitimate regulation. The concept of “regulatory taking” in domestic law often informs this analysis, but international tribunals look at the specific wording of the investment treaty and relevant international jurisprudence.

The scenario describes a situation where a foreign investor, Solara Corp., established a solar energy project in Alabama, relying on specific representations made by the state regarding regulatory stability and future energy policies. Alabama subsequently enacted new environmental regulations that significantly increased the operational costs for Solara Corp., effectively rendering its investment less profitable than anticipated. Solara Corp. believes this constitutes a breach of the investment protections afforded to it. In international investment law, particularly under many Bilateral Investment Treaties (BITs) or investment chapters of Free Trade Agreements (FTAs), the concept of “legitimate expectations” is crucial. This doctrine suggests that investors can rely on representations made by the host state that induce investment. When a host state alters its legal or regulatory framework in a way that frustrates these established expectations, it can lead to a claim for breach of the Fair and Equitable Treatment (FET) standard. The core of the issue here is whether Alabama’s regulatory change, while ostensibly enacted for public interest (environmental protection), can be considered an indirect expropriation or a breach of FET due to its impact on Solara Corp.’s legitimate expectations. Indirect expropriation occurs when a state’s actions, though not a direct seizure of property, deprive the investor of the fundamental economic value or use of its investment. The key is to determine if the regulatory change was arbitrary, discriminatory, or disproportionate to the stated public purpose, and if it substantially undermined the investment’s viability by frustrating the investor’s reasonable and legitimate expectations formed at the time of investment, based on prior governmental assurances or established practices. Alabama, as a host state, retains the sovereign right to regulate for public welfare, including environmental protection. However, this right is not absolute and must be exercised in a manner consistent with its international investment commitments. The question is whether the new regulations were enacted in a manner that unfairly targeted Solara Corp.’s investment or imposed an excessive burden that goes beyond the scope of legitimate regulatory action, thereby breaching the FET standard by violating the principle of legitimate expectations. The absence of a specific provision in the relevant treaty or agreement that explicitly permits such regulatory changes without compensation, or the presence of a general FET clause that encompasses protection of legitimate expectations, would strengthen Solara Corp.’s claim. The analysis would involve examining the proportionality of the regulatory action, the presence of any reasonable alternatives, and the extent to which the state’s conduct was predictable or represented a radical departure from established norms.

The question probes the nuanced application of the “fair and equitable treatment” (FET) standard within the framework of international investment law, specifically concerning a host state’s regulatory changes. The FET standard, a cornerstone of investor protection, is not static; it evolves through arbitral jurisprudence. While FET generally encompasses protection against arbitrary, discriminatory, or abusive governmental actions, it also extends to protecting an investor’s legitimate expectations. When a host state, like Alabama in this hypothetical, enacts legislation that fundamentally alters the economic viability of an investment by withdrawing previously guaranteed incentives or imposing unforeseen burdens, it can be argued that the state has breached its FET obligations. This is particularly true if the investor reasonably relied on the prior regulatory regime when making the investment. The concept of a “legitimate expectation” is crucial here. It is not merely about the absence of a direct expropriation but about the state’s conduct that frustrates the investor’s ability to conduct its business in a stable and predictable environment. The Alabama Department of Environmental Quality’s (ADEQ) revised regulations, which retroactively increased compliance costs for renewable energy projects and effectively nullified prior tax credits crucial to the project’s financial model, could be seen as an indirect expropriation or a breach of FET by undermining the investment’s foundational economic assumptions. The assessment of whether this constitutes a breach requires examining the specific language of the investment treaty, the nature of the regulatory change, the investor’s reliance, and the proportionality of the state’s action. Arbitral tribunals often consider whether the state acted in bad faith, whether the changes were discriminatory, or whether they were so severe as to deprive the investor of the fundamental benefits of its investment. In this scenario, the abrupt withdrawal of tax credits and the imposition of new, costly environmental standards that were not foreseeable at the time of investment, and which directly impact the profitability of the solar farm, strongly suggest a potential breach of FET. The key is that the regulatory change, while perhaps serving a legitimate public purpose (environmental protection), was implemented in a manner that retroactively and severely damaged the investor’s reasonable economic expectations, thereby violating the FET standard as interpreted in numerous international investment arbitrations.

The question revolves around the concept of indirect expropriation in international investment law, specifically how a state’s regulatory actions can constitute an expropriatory act even without outright seizure of an investment. The scenario describes the state of Alabama implementing a new environmental regulation that significantly restricts the operational capacity of a foreign-owned solar farm. This regulation, while ostensibly for public welfare, has the effect of rendering the investment commercially unviable. In international investment law, indirect expropriation occurs when a state’s actions, though not a direct taking of property, deprive an investor of the fundamental economic use or benefit of their investment, thereby amounting to a taking of property for which compensation is due under international law. Key factors in determining indirect expropriation include the extent and duration of the interference, the impact on the investor’s reasonable expectations, and whether the measure serves a legitimate public purpose. In this case, the regulation’s severe impact on the solar farm’s operations, potentially leading to its closure, suggests a deprivation of economic benefit. The critical element is whether the regulation is so burdensome and disproportionate to its stated public purpose that it effectively amounts to a taking. The existence of a Bilateral Investment Treaty (BIT) between the foreign investor’s home country and the United States, which includes protections against expropriation, provides the legal basis for a claim. Alabama’s action, if found to be an indirect expropriation, would breach the obligations under such a treaty. The calculation of compensation, should a breach be found, would typically involve assessing the fair market value of the investment immediately prior to the expropriatory act, considering lost profits and other damages. However, the question asks about the *nature* of the action and its potential classification, not the quantum of damages. Therefore, the core legal issue is whether the regulatory measure crosses the threshold into indirect expropriation.

The question probes the interplay between a host state’s regulatory autonomy and the substantive protection afforded to foreign investors under international investment law, specifically focusing on the concept of “fair and equitable treatment” (FET) as interpreted in arbitral jurisprudence. When a host state, such as Alabama, enacts legislation to address evolving public policy concerns, like environmental protection or public health, and this legislation incidentally impacts an existing foreign investment, the analysis centers on whether such measures breach the FET standard. The FET standard, as elaborated through various arbitral decisions, often encompasses protection against arbitrary, discriminatory, or abusive conduct by the host state, as well as the protection of legitimate expectations. A key element in determining a breach is whether the state’s actions were taken in good faith, were transparent, and were not designed to frustrate the investor’s reasonable expectations formed based on prior representations or the investment’s context. A measure that is non-discriminatory, transparent, and serves a legitimate public purpose, even if it negatively affects an investment, may not necessarily violate FET if it does not involve arbitrary or abusive conduct or a clear violation of established legitimate expectations. The challenge lies in balancing the state’s inherent right to regulate in the public interest with its international obligations to provide a stable and predictable investment climate. The absence of a clear “grandfathering” of rights for existing investments against all future regulatory changes, coupled with the general acceptance of a state’s right to enact new laws for public welfare, means that a mere adverse economic impact from a generally applicable, non-discriminatory regulation does not automatically equate to a breach of FET. The arbitral tribunals often look for a more egregious level of state conduct, such as a denial of justice, a manifest breach of a specific commitment, or a drastic alteration of the investment’s fundamental basis without due process or compensation. Therefore, a regulatory measure that is enacted through proper legislative process, is non-discriminatory, and serves a demonstrable public policy objective, even if it diminishes the profitability or value of a foreign investment in Alabama, would likely be permissible under FET if it does not involve arbitrary or abusive actions or a breach of specific, established legitimate expectations.

The core issue here is the interpretation of “indirect expropriation” under a hypothetical Alabama-specific Bilateral Investment Treaty (BIT) that mirrors common international investment law principles. Indirect expropriation occurs when a host state’s actions, while not a direct seizure of an investment, effectively deprive the investor of the substantial use, enjoyment, or value of their investment. This is distinct from regulatory actions taken in good faith for public welfare, which generally do not constitute expropriation unless they are so severe as to be confiscatory. In this scenario, the State of Alabama’s new environmental regulations, while impacting the profitability of the geothermal energy project, do not physically seize the assets or directly prevent the operation of the plant. The regulations impose additional operational costs and potentially reduce the revenue stream. However, the project can still operate, and the investor retains ownership of the physical assets and the right to operate. The key question is whether the economic impact is so severe as to amount to an indirect expropriation. International investment tribunals generally consider several factors when assessing indirect expropriation, including the economic impact of the measure, the regulatory intent of the state, the duration of the interference, and whether the measure was taken in good faith for a public purpose. A significant reduction in profitability, while impactful, does not automatically equate to expropriation. The measure must effectively extinguish the economic value or use of the investment. In this case, the regulations increase costs but do not render the project entirely unviable or confiscatory. The investor still possesses the core rights to operate and benefit from the investment, albeit with reduced returns. Therefore, the measures are more likely to be characterized as a regulatory action, even if burdensome, rather than an expropriatory act. This aligns with the principle that states retain regulatory autonomy for public welfare purposes, provided such measures are not disproportionate or designed to circumvent investment protection obligations. The absence of a direct physical taking or a complete deprivation of economic benefit means the threshold for indirect expropriation has likely not been met.