This paper examines
the legal permissibility of a state using the doctrine of countermeasures as a
defence against liability for destruction of foreign investor assets through
the imposition of sanctions. Part I briefly surveys the origins and history of
countermeasures, particularly in light of Articles for the Responsibility of
States for Internationally Wrongful Acts (ARSIWA), before outlining their
substantive and procedural requirements in current doctrine. Then, Part II
examines several recurring questions within the doctrine of countermeasures. It
explores whether third-party countermeasures are permissible within the context
of erga omnes obligations, where all states have a shared interest in
enforcement. It then addresses the unsettled issue of whether countermeasures
may be raised as a defence against claims by private investors brought under
bilateral investment treaties. Here, arbitral decisions, such as ADM v. Mexico,
Corn Products v. Mexico, and Cargill v. Mexico, which were decided in the
context of the North American Free Trade Agreement (NAFTA), illustrate a sharp
divergence in opinion over whether investor rights are derivative of states, or
independent in nature. Finally, consideration is given to the relationship
between lex specialis and lex generalis, assessing whether and when specific
treaty provisions can displace Customary International Law (CIL) on
countermeasures. This paper aims to introduce, in brief, the ongoing tension
between state sovereignty, collective enforcement of international norms, and
investor protections, while underscoring the lack of consensus on the
permissibility of unilateral third-party countermeasures.