Abstract
Abstract Stabilization clauses, which can be contract or legislation based, are meant to restrain a government from exercising its legislative and administrative powers to modify investment contracts it struck with mining companies. Their purpose is to assuage the investor’s concerns that the state party may unilaterally nullify mining rights through legislation. From the viewpoint of national public law, the idea that a state could fetter its ability to legislate through contract is problematic. Such tension is well illustrated by an Israeli Supreme Court Decision from 27 March 2016, according to which stabilization clauses breach ‘the general principle of administrative law regarding the prohibition of shackling the authority’s ability to govern’ since ‘the government does not have the power not to decide and not to act.’ Many questions arise concerning the effect of stabilization clauses in national and international law. These include: (1) whether stabilization clauses are compatible with national constitutions, (2) whether international law gives any effect to stabilization clauses even when they are incompatible with national law, (3) whether these clauses impede state regulation or merely create a duty to compensate the mining company. We will explore these three issues by analysing the contractual and legislative practice of Kazakhstan and Uzbekistan, referring to the not-so-consistent international case law on those issues.