Arbitral Tribunals Research Articles

Mass claims in international investment arbitration

Following the economic crisis in Argentina international investment tribunals faced a new challenge: mass claims characterized with multiple claimants bringing the significant amount of homogeneous investment protection claims against the host state. Neither the 1965 Convention on the Settlement of Investment Disputes Between States and Nationals of Other States, nor applicable bilateral investment treaties cover the tribunals’ power to resolve mass claims. They are silent on crucial questions of jurisdiction and consent and do not address important procedural issues either. In these circumstances arbitral tribunals face the inevitablegap-filling process, which boils down to the critically important question of legal nature of mass claims. If mass claims are nothing more than a mere variety of “ordinary” claims, than the issues of special or “secondary” consent are irrelevant, since the general consent for arbitration will suffice for the tribunal to find itself competent to resolve the dispute. By contrast, if mass claims are different in their legal nature from “ordinary” bi- or multiparty arbitration, they cannot “fit” into the scope of parties’ general consent. In controversial Abaclat decision the majority ruled that the questions of tribunal’s powers to decide on mass claim brought by Italian investors against Argentina pertain to the sphere of admissibility rather than jurisdiction. This analysis was not accepted by dissenting arbitrator G. Abi-Saab. Interestingly, other multi-party “Argentinian” awards followed the line of argument which significantly differed from both the majority opinion in Abaclat and G. Abi-Saab’s dissent. This only highlights the controversial nature of mass claims in international investment arbitration. This article is dedicated to analysis of jurisdictional issues raised in the course of “Argentinian” arbitrations. Since this analysis is strongly intertwined with two other systems of resolution of mass claims, namely American class arbitration and public international law mechanisms dealing with the compensations for states’ international wrongdoings, these two mechanisms are also explored to provide better context and understanding.

Deference of Seat or Foreign Courts to International Commercial Arbitration Tribunals Concerning Procedural Issues: Australia in Regional and Global Contexts

Deference of Seat or Foreign Courts to International Commercial Arbitration Tribunals Concerning Procedural Issues: Australia in Regional and Global Contexts

“Historic title” in international law of the sea and the legal significance of the July 12, 2016 award of the arbitral tribunal constituted under annex VII to the 1982 United Nations Convention on the law of the sea

On July 12, 2016, the International Arbitral Tribunal constituted under Annex VII to the 1982 United Nations Convention on the Law of the Sea (UNCLOS) officially ruled the case of the Philippines against China, thereby confirming the claims of China in the South China Sea are nullified. The ruling in favor of the Philippines is mainly to exercise political and diplomatic pressure and create public opinion to force China to behave in consistence with UNCLOS. Even so, the award still has the legal effect of effectively deterring China’s expansionist policies. This article addresses the role of the award in nullifying the “historic title” claimed by China to realize its “nine-dash line” under its territorial claim in 2009 in the future.

PRACTICE OF MEDIATOR'S COURT IN URBAN SETTLEMENTS OF THE FIRST QUARTER OF THE 19th CENTURY

Mediation is an integral part of pre-trial conflict resolution. The decrees on me-diation available in the Russian legislation of the 18th–19th centuries regulate the main criteria for functioning of this institution and include such elements as court composition, scope of regulation, terms, etc. The report considers three main laws on the practice of the mediator’s court covering almost a century. The first mention of the term refers to 1727 and used to mean an intermediary. Through time, the mediator’s court undergone changes affecting its social, professional and procedural scope of regulation, and by the beginning of the 19th century it had acquired the features of arbitral tribunal. Despite the complica-tion of legal proceedings, the basic feature of mediator’s court was the unchanging agree-ment of the parties with the candidates for mediators and the decisions they made. The in-cident that happened in Sergiyev Posad demonstrates the use of mediation in practice in the first quarter of the 19th century, and allows us to conclude that mediation is one of the most important components of municipal government, it is historically determined, de-pends on changing real conditions, and is adjusted by life circumstances.

Intra-EU Application of the Energy Charter Treaty: A Critical Analysis of the CJEU’s Ruling in Republic of Moldova

In its recent judgment in Republic of Moldova (also known as the Komstroy case), the Court of Justice of the European Union (CJEU) took the view that the arbitration clause contained in Article 26(2)(c) of the Energy Charter Treaty (ECT) does not apply to intra-EU investor-State disputes. This article provides a critical analysis of this ruling and highlights the methodological flaws of its reasoning. As part of this analysis, it discusses the implications of the Energy Charter Treaty’s nature as a “mixed agreement” for the scope of application of Article 26(2)(c) and the CJEU’s jurisdiction to interpret the ECT. It also discusses the proper interpretation of Article 26(2)(c) pursuant to the rules on treaty interpretation laid down in the Vienna Convention on the Law of Treaties, including with the help of documents from the ECT’s travaux préparatoires. Finally, the article deals with Republic of Moldova consequences – or rather the lack thereof – for arbitral tribunals and the courts of non-EU countries.

Contencioso entre Guyana e Suriname acerca dos limites marítimos (2000-2007)

This paper objective to analyze the main outlines of the dispute about the maritime limits between Guyana and Suriname and the scope of the arbitration award that delimited the maritime border between the two countries. Guyana and Suriname find themselves in a geopolitical position of fusion and meeting between the Caribbean and the Amazon region, providing a rich field of research. The methodology adopted consisted of consulting the specialized bibliography and analysis of official documents presented to the Arbitral Tribunal by both countries, as well as documents referring to the decision of the case. The main considerations about the research point out that the bilateral relationship between Guyana and Suriname was built on the basis of pendular dynamics, that is, they sometimes pointed to an approximation, sometimes to distance, in which attempts to define maritime limits were developed. The claims were arbitrated internationally, whose decision, establishing a single maritime limit, corroborates the gradual process of stability between the two countries.

Incidental Jurisdiction in Investment Treaty Arbitration and the Question of Party Consent

Arbitral tribunals in investment treaty arbitration have not contributed much to the theoretical development of the concept of incidental jurisdiction, even though they have occasionally exercised it in practice. One possible explanation for their apparent reluctance to make explicit and greater use of the concept of incidental jurisdiction is the tendency to adopt a strict approach to jurisdiction governed by party consent. In this essay, I argue that incidental jurisdiction is not in tension with the consensual foundations of international jurisdiction when it is viewed as one inherent power of international courts and tribunals. Key to this argument is that incidental determinations are not binding, and therefore do not need to fall within party-defined jurisdictional limits.

A study on denial of benefits clause in international investment arbitration

오늘날 일부 국제투자협정은 적용대상 투자 및 투자자의 범위를 포괄적으로 규정하면서, 특정 범주의 투자자를 그 적용범위에서 배제하는 소위 혜택부인조항을 두고 있다. 이는 협정의 체약국과 일정한 관련이 없는 투자자에 대하여 협정의 보호를 배제하는 취지의 규정이다. 즉, 혜택부인조항은 투자자가 실질적인 투자 활동 없이, 오직 투자중재의 관할권을 획득할 목적으로 지배구조를 개편하여 유리한 협정의 보호를 원용하려는 소위 협정쇼핑과 같은 절차남용적 행위를 차단하는 역할을 할 수 있다. 본고는 중재판정사례를 통하여 혜택부인조항의 적용요건과 방식 및 효과를 분석하였다. 이를 통해 투자중재에서 노출된 문제, 예컨대 투자협정의 불분명한 조문을 명확히 하여 중재판정부의 자의적인 해석이 개입되지 않도록 하는 한편, 이것이 투자협정의 보편적인 규정으로 정립하는데 따른 정책적 시사점을 제시한다.Denial of benefits clause in international investment treaties is generally designed to exclude from treaty protection nationals of third States who seek to benefit from provisions that the State parties to the treaty did not intend to grant them. This clause allows a State party to deny the benefits of the treaty to investors that lack a sufficient connection to the treaty party in which they are incorporated. Thus, it prevents the third country nationals who own or control the investor from gaining access to treaty protection when they would otherwise not benefit from such protection due to their nationality. With respect to the procedural requirements of the denial of benefits clause, arbitral tribunals have consistently required that a State must affirmatively exercise its right to deny benefits to an investor. Once a State exercises its right to deny the treaty protection, it remains to be answered whether it affects the tribunal’s jurisdiction to hear the claim, or only the substantive provision under a treaty. This turns on the wording and scope of the provision in question. Denial of benefits clause is an important too by which State parties can achieve a policy of excluding certain investors from the benefits of investment treaties. However, efforts should be made to treaty drafting in order to ensure that investors falling within the scope of a denial of benefits clause and the procedural requirement for invoking the clause are clearly defined in order for this policy to be achieved.

IS THERE ANY CONTRAST BETWEEN FAIR AND EQUITABLE TREATMENT AND PUBLIC INTERESTS UNDER INTERNATIONAL INVESTMENT AGREEMENTS AND INVESTOR-STATE ARBITRATIONS?

Today, more than 3,200 international investment agreements (IIAs) have been concluded, and most of them address substantive and procedural protection mechanisms. One of the essential substantive standards is the standard of fair and equitable treatment and one of the procedural mechanisms is Investor-state Arbitration. Usually, when an investor investing in the host state, there can be no denying that there may be a conflict between the public interest and the investor protection mechanisms. The mechanism of fair and equitable treatment is one of the essential standards that may be harmed by the public interests, especially the protection of the environment. On the one hand, in accordance with this standard, the host states are obliged to create stable, fair, favorable and transparent conditions for investors. On the other hand, the states have a duty to the public interests of their countries and at a larger level the international community. Purpose: In this paper, we want to show whether there is a discrepancy between the substantive standard of fair and equitable treatment and public interest in the text of the IIAs or in the arbitration procedure? Methods: general scientific methods of theoretical knowledge, as well as general logical methods and research techniques are used in analyzing existing investment agreements and Arbitration awards. Results: Examining the text of many of the IIAs, we came to the conclusion that there is no difference in the text of the agreements, in other words, the agreement encourages governments to strike a balance between investor protection standards and the protection of the public interest. However, in the implementation of agreements by the states, there is a difference between the two areas of protection of public interest and the standard of fair and equitable treatment, and here the arbitral tribunals must resolve the differences.

Corporate Wealth Over Public Health? Assessing the Resilience of Developing Countries' COVID-19 Responses Against Investment Claims and the Implications for Future Public Health Crises

In the wake of the Covid-19 pandemic, states around the world swiftly enacted a multitude of far-reaching emergency responses to contain the viruses’ spread and to cope with the economic repercussions of the ensuing crisis. However, these measures detrimentally impacted the operating conditions of many businesses or, at the least, decreased their profitability. As this inevitably affected foreign investments, investors could be tempted to invoke “Investor State Dispute Settlement” (“ISDS”) clauses in International Investment Agreements (IIAs) to initiate proceedings before arbitral tribunals and seek compensation for loss of profit caused by states’ Covid-19 responses. Due to the specific circumstances in most developing countries, they were hit particularly hard by the crisis and are especially vulnerable to the threat of investment claims. It is therefore important to enable developing countries to realistically anticipate the risk of investment arbitration by assessing the chances of success of foreign investment claims against those policies that were most frequently adopted by them amidst the crisis. Against this background, this paper assesses how likely developing countries’ Covid-19 responses breached substantive standards of investor treatment under typical IIAs and which defense strategies states may invoke to justify their regulatory action. Based on this analysis, this paper concludes by formulating policy recommendations on how developing countries may enhance the resilience of their emergency responses against foreign investors amidst future public health crises.

Blockchain-Based Smart Contract: Advancing Digital Consumer Protection and Preventing Private International Law E-Commerce Cases

<em>Blockchain has functioned as a ledger that decentralizes controls with immutable and irreversible character and have the potential to overcome the deficiency of traditional contracts, especially in today’s digital era such as the e-commerce industry. Unfortunately, although famous to be used for blockchain and smart contracts have not been applied widely in Indonesia and there is no regulation that specifically regulates the use of blockchain technology and smart contracts. This article will analyze the application of smart contracts to escalate consumer rights in e-commerce services. This research showed that the self-executory characteristic of smart contracts helps the consumer to have an equal bargaining position with businesses actors in determining the contents of the contract. In response to those curative efforts, the smart contract will be advantageous as a preventive scheme for PIL cases. The self-executory character of the smart contract will prevent many PIL cases which are potentially occurred. The immutable nature of blockchain records will also be helpful for any dispute settlement scheme. This might be led to the tendency that international e-commerce cases should not be litigated or to be set for an arbitration tribunal. Those international e-commerce cases might not require settlement of judicative branch and may be settled at the administrative level. Consequently, this would create a more effective and efficient settlement, both in time and money. Those advantages have made blockchain-based smart contracts will be prospective in Indonesia, in the upcoming future</em>

The arbitrability of antitrust disputes: a Chinese perspective

Abstract The cornerstone of public policy debate opens the door for arbitral tribunals to deal with antitrust disputes. It has long been a controversial issue whether antitrust disputes related to commercial contracts could be arbitrable, given the lack of clarity under Chinese law. China’s Supreme People’s Court in Shell v Huili has seemingly provided important but paradoxical guidance on non-arbitrability. Arguably, the ruling may be incompatible with the doctrine of international comity in the current transnational dispute resolution mechanism. It is argued that the operation costs for all stakeholders would be considerably reduced if China could integrate into the established international track.

The subject matter of arbitral tribunals in the resolutions of the Permanent Council (1776–1788)

Original version: Problematyka sądownictwa polubownego w rezolucjach Rady Nieustającej (1776–1788), “Czasopismo Prawno-Historyczne” [Journal of Legal and Historical Sciences], 2016, vol. 68, issue 2, pp. 85–108.

How to Enforce the Achmea Judgment – Tools for EU Member States before, during and after Investment Arbitration Proceedings Brought by an Investor from Another EU Member State

Arbitration tribunals, in particular those established under the ICSID Convention, refuse to adhere to the judgment of the Court of Justice of the European Union in Achmea. Are EU Member States at their mercy? So goes the story presented at conferences and roadshows, as well as in academic publications, which often point to the special protection that ICSID awards enjoy pursuant to Articles 53 and 54 of the ICSID Convention (this element is also often recalled by ICSID tribunals in awards in reaction to arguments based on Union law, in particular the unenforceability of intra-EU awards). This article sets out effective weapons that EU Member States may deploy prior to, during, and after the arbitration procedure, in order to enforce effectively the judgment in Achmea.

ABSENCE OF JURISDICTION AND CONSEQUENCES IN ARBITRAL PROCEEDINGS

The Arbitration Act 1996 states that a request for a stay must be conceded before the individual against whom the procedures were brought has made any move to respond substantively to the case and no sooner than after fitting technical advancements (assuming any) are made to recognize the lawful procedures. The ZPO provides that the challenge must arise prior to the start of the oral hearing on the matter of the dispute. When raising an issue with the courts of law, jurisdiction is of the utmost important for the assurance of whether the option to arbitrate may be postponed. Noncompliance may result in the court continuing to consider the subject of the dispute and, for the most part, make a choice that will exert jurisdiction upon the parties. Despite the fact that the arbitral tribunal may not be limited by the court’s choice, it is, on a basic level, necessary to contemplate upon a protest by one of the parties, regardless of whether the option to arbitrate has been postponed.

The Status of Crimea and the Sea of Azov as a Jurisdictional Hurdle in Ukraine v. Russia

Abstract On 21 February 2020, the arbitral tribunal constituted under Annex vii of the United Nations Convention on the Law of the Sea (unclos) in the Dispute Concerning Coastal State Rights in the Black Sea, Sea of Azov, and Kerch Strait (Ukraine v. the Russian Federation) rendered its award concerning preliminary objections. This comment focuses on the arbitral tribunal’s findings concerning Russia’s two most important and far-reaching objections, both of which concern jurisdiction ratione materiae. First, it argues that the arbitral tribunal convincingly declined jurisdiction over those of Ukraine’s claims, which would have required the arbitral tribunal to decide the dispute between Ukraine and Russia concerning sovereignty over Crimea. Second, this comment analyzes the arbitral tribunal’s conclusion that the parties’ dispute concerning the status of the Sea of Azov and Kerch Strait was not of an exclusively preliminary character and must, therefore, be reserved for the proceedings on the merits.

Peculiarities of Application of Interim Measures in Arbitration

With the entry into force of the new version of the Law of Commercial Arbitration, various amendments have emerged which have advantages and may have disadvantages, one of the main changes - the expanded list of measures of protection. Arbitration is a peaceful way of resolution of disputes, but the Institute for Interim Measures needs to be used in order for the arbitral award to be made. This article discusses specifics of application of interim measures in arbitration. The application of interim measures by the arbitral tribunal may have adverse consequences for the defendant. Therefore, this article will also discuss the possible damages resulting from the application of interim measures in arbitration, indemnity and compensation institute. An analysis of the case law provides conclusions as to whether an intermediate search and a balance of interests are maintained. The findings will also be made or the arbitral tribunal will grant the interim measures without the determination of the state court. In order to discuss in detail the peculiarities of the application of interim measures in arbitration, not only the legal acts and case law of the Republic of Lithuania are reviewed, but also the case law of foreign courts on this issue is analyzed. Problems arising from application of interim measures in national and foreign arbitration courts were also discussed. The analysis of the scientific literature provided preconditions for the formulation of questions, the answers to which would provide a deeper analysis of the scientific problem of this article. According to the results of scientific literature analysis, the general interview questions were formulated in order to get the in-depth insights of the experts about peculiarities of application of interim measures in arbitration. The 5 experts Arbitration specialists perform work functions in the arbitral tribunal were selected and interviewed using the interview method. According to the survey, four out of five respondents consider that it is not necessary for the legislature, in order to address the issue that the arbitral tribunal does not have the possibility to apply coercive procedural measures in the absence of an interim injunction, to allow the claimant to apply for excessive coercive measures. in an arbitration case, in parallel to bring a civil action before a court of general jurisdiction, requesting the use of coercive procedural measures.

CISG as a Governing Law to an Arbitration Agreement

Purpose – This paper studies whether the CISG is applicable to the arbitration agreement when the validity of the arbitration agreement becomes an issue. To make the study clear, it limits the cases assuming that the governing law of the main contract is the CISG and the arbitration agreement is inserted in the main contract as a clause. Also, this paper discusses only substantive and formal validity of the arbitration agreement because the CISG does not cover the questions of the parties’ capacity and arbitrability of the dispute. Design/methodology – This paper is based on scholarly writings and cases focusing on the principle of party autonomy, formation of contract and the doctrine of separability to discuss characteristic of arbitration agreement. In analyzing the cases, it concentrates on the facts and reasonings that show how the relative regulations and rules are interpreted and applied. Findings – The findings of this paper are; regarding substantive validity of arbitration agreement, the courts and arbitral tribunals consider general principles of law for the contract and the governing law for the main contract. In relation to formal validity of arbitration agreement, the law at the seat of arbitration or the law of the enforcing country are considered as the governing law in preference to the CISG because of the recognition and enforcement issues. Originality/value – This paper attempts to find the correlation between the CISG and the arbitration agreement. It studies scholars’ writing and cases which have meaningful implication on this issue. By doing so, it can provide contracting parties and practitioners with some practical guidelines about the governing law for the arbitration agreement. Furthermore, it can help them to reduce unpredictability that they may confront regarding this issue in the future.

The Legal Policy of Executability in the International Arbitral Tribunal Decision for Settlement of Investment Disputes

<div><table cellspacing="0" cellpadding="0" align="left"><tbody><tr><td align="left" valign="top"><p class="AbstractText">The growing number of investment disputes indicates more challenging and controversial matters in the various arbitration practices. However, the International Centre for the Settlement of Investment Disputes (ICSID) rules do not entirely solve the problem in the arbitration process. This study aims to explain how the ICSID tribunal’s inherent reconsideration power can be exercised to “fill the gap” in arbitration proceedings. This study concludes that it can be enforced under Article 44 of the ICSID Convention, which decides the question submitted to the tribunal that the ICSID Convention does not cover. Second, in completing this study, the wording of Rules 19 of Arbitration Rules gives an almost similar order to the tribunals in the case of absence in the conduct of proceedings. Third, under Rule 38 (2) Arbitration Rules, the tribunals can exercise the reconsideration power when discovering new facts that decisively affect the case's outcome.</p></td></tr></tbody></table></div>

Police Powers Doctrine: a reliable State Defense in times of Covid-19?

As measures taken against the threats of Coronavirus to the public health affect investments in South America and internationally, states are looking for defenses under international law to counter potential Investor-State claims. This article explores whether the Police Powers Doctrine could justify the policy measures taken to protect the public health during the Covid-19 sanitary crisis and avoid the payment of compensation for alleged indirect expropriations. The analysis will first lay out the general application of Police Powers Doctrine under international investment law. To do so, it will mainly investigate the interpretation of the Doctrine in cases relating to the protection of public health. Finally, it will assess the strength of the Doctrine in defending general policy measures taken during the Covid-19 sanitary crisis. The paper argues that, while most measures should qualify under the Police Powers Doctrine, arbitral tribunals might examine additional conditions to accord their legal qualification of an exercise of police powers with the specific facts of a case.