Reconceptualizing ‘Failure to State Reasons’ as a Ground for Annulment under Article 52(1)(e) of the ICSID Convention

Abstract

According to the majority view on Article 52(1)(e) of the ICSID Convention, an inquiry by an annulment committee into the adequacy of the reasons offered by a tribunal is not an appropriate standard of review, as this would mean that the committee is acting as an appellate court. This article challenges that view. By examining what it means to say that an award has to be motivated by reasons, this article argues that there is no necessary correlation between a less restrictive scope of review and a review of the merits of a case. Rather, ICSID committees ought to examine the adequacy of a tribunal’s reasoning. Additionally, committees enjoy (limited) discretion to require more or less justification regarding particular interpretative problems, depending on the hardness or easiness of each case. A contrary view would deprive annulment of its function as the guarantor of legitimacy in the ICSID dispute settlement system.