"The Government’s plans announced in the King’s Speech today that would allow it to renationalise nearly all passenger rail services will need to be scrutinised carefully to ensure that any renationalisation complies with the UK’s obligations under applicable international investment treaties.
The UK is party to more than 100 bilateral investment treaties which provide significant protections to qualifying investors in the UK, including investors (such as shareholders and others with direct or indirect financial interests) in the UK rail infrastructure sector. These treaties contain strict conditions relating to the nationalisation of any protected investment (including an obligation to pay fair market value compensation).
Similarly, a decision by the Government not to renew or extend existing contracts when they expire in the coming years may equally give rise to claims for compensation by affected investors."