Question

What is creeping expropriation? How does it differ from general expropriation, and how can it be remedied?

Answer 1

The initiative of the government to remove the rights vested in the domestic properties by foreign investors is referred to as Creeping Explorations. It is done by increasing tax rates, implementing new rules, laws and legislations such that it discourages foreign investors by making their projects yield very less or nothing.

The remedies for include:

• Resorting to treaties between the foreign government and with the home. They may be foreign trade policies, Double tax avoidance agreements, etc.
• Availing political insurance viz an insurance designed to protect the interests of the investors when the host government implements nationalisation of the domestic properties or investments..
• Foreign investors can also negotiate with the host government and enter into agreements for having properties in the country.

General expropriation is a system where government exercises it's right to bring the benefits of private property into public usage. It may be by using the private properties for use of highways, bridges, bus stations, metro, etc.