The Interplay between International and National Institutions in Fighting Corruption: Lessons from the Piero Foresti, Laura de Carli & Others v. The Republic of South Africa’s Case

Abstract

Piero Foresti, Laura de Carli and others v. Republic of South Africa is the only case, administered by the International Centre for the Settlement of Investment Disputes (ICSID), that involves the Republic of South Africa. This case was characterized by an allegation of corruption which appeared, not ‘before’ the referral to the tribunal as occurs in most investment disputes, but ‘during’ the proceedings of the ICSID tribunal: How did the corruption manifest in this case? How was it fought and by which institutions? This article examines these questions and discusses the role of arbitral tribunals and local institutions (notably courts and national bar associations) in addressing the challenge of corruption. It looks also at the kind of interplay that may exist between international and national institutions for an effective fight against corruption. Such a discussion is particularly relevant in the context of a country like South Africa, which has terminated most of its bilateral investment agreements and replaced them with a national piece of legislation: The Protection of Investment Act (PIA) of 2015 which does not provide for Investor-State Arbitration. Consequently, foreign investors in this country have only recourse to national adjudicative bodies (but also to mediation or state-to-state arbitration) for the settlement of their disputes, including corruption-based disputes. Therefore, what are the lessons to be learned from this case with regard to the uses of the law to combat corruption and to the adequacy of national institutions to deal with corruption cases with transnational elements?