Attribution in international investment arbitration: Sources of law and practical challenges

An arbitral tribunal shall, in its arbitral award, order a State to compensate a foreign investor for damages if the investor proves in international investment arbitration: (i) an act or omission by which the State breached an obligation under international law; and (ii) a basis for attributing such act or omission to the State, provided that there are no grounds excluding the State's responsibility. The conditions under which an act or omission may be attributed to a State are contained in the rules of treaty-based and customary international law. In international investment arbitration, the conduct of State organs is unquestionably attributable to the State. Under certain conditions (which will be analyzed in this paper), the conduct of private entities entrusted by domestic law with public powers may also be attributed to the State, as may the conduct of private entities that neither formally possess the status of State organs nor have been vested with public powers under domestic law. Recent international investment arbitration practice has raised dilemmas regarding the classification of certain entities into one of the aforementioned categories. In Lu pa ka Gold Corp. v. Republic of Peru from 2025, the arbitral tribunal considered the attribution of conduct by an indigenous community possessing separate legal personality from the State - incompatible with the status of a state organ - while at the same time being entrusted with activities that the investor interpreted as public (governmental) powers. The aim of this paper is, first, to present the principal sources of law and the conditions of attribution applicable in international investment arbitration and, subsequently, to analyze the arbitral Tribunal's reasoning in Lu pa ka Gold Corp. v. Republic of Peru.