Venezuela currently faces 7 cases before ICSID tribunals, most as a result of the forced nationalizations in industries such as petroleum and mining.

Although Venezuela has often sought to compensate foreign investors, its offers have usually been rejected as too low.

In this context, Article 5 of the Venezuela-Russia BIT, which calls for compensation at market value in cases of expropriation, is noteworthy. This is a departure from many of Venezuela’s previous BITS, such as those with the UK, Canada and Sweden, which refer to ‘adequate and effective compensation’ based on “genuine value.”

Venezuela has often offered to compensate companies for nationalizations using the usually lower book value instead of market value, notes Andres Mezgravis, a Caracas-based lawyer. This may hurt Venezuela’s nationalization efforts because investors from countries protected by BITs with national treatment clauses could demand compensation at market value by referencing the Russia-Venezuela BIT, said Mr. Mezgravis.