"But-for" analysis

The "but-for" analysis (or counterfactual analysis) is an economic methodology used to estimate what would have happened in the absence of a specific event — a breach of contract, unfair competition, wrongful termination of a commercial relationship, or disclosure of confidential information. It is central to the quantification of economic damages in commercial litigation and arbitration: by constructing a credible counterfactual scenario and comparing it to the actual scenario, the expert quantifies the harm suffered. In business valuation contexts, it draws on financial modelling, market analysis and industry benchmarking to build a defensible but-for projection.

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Example: a Swiss distributor claims CHF 4.5 million in lost profits following the wrongful termination of an exclusive supply agreement. Hectelion constructs the but-for scenario based on pre-termination growth rates and sector benchmarks, comparing it to actual post-termination revenues. The resulting lost profit estimate of CHF 3.2 million is presented in an expert report submitted to the ICC arbitral tribunal.

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Hectelion prepares but-for analyses for commercial litigation and arbitration proceedings, combining financial rigour with sector-specific market knowledge.