Arbitration System Research Articles

Investor-State Arbitrators' Duties to Non-Parties

Arbitrators in investor-state disputes plainly owe duties to the parties. They are appointed to do a job and they must do that job and do it well: competently, diligently, ethically, expeditiously, fairly, impartially and independently, and properly. They must act with sound judgment, due care, and an open mind. But do investor-state arbitrators also owe duties to anyone else? If so, what duties do they owe and to whom? From where do such duties originate? Given that party autonomy is a hallmark of arbitration, may duties to non-parties ever prevail over the will of the parties? How are such duties enforced? And, what does the existence of duties to non-parties mean for the system of international investment arbitration? Investment arbitration was born from a party-centric tradition. But it has become clear that tribunal rulings affect non-parties. Scrutiny is needed of the responsibilities the arbitrators owe those outside the room. This article explores this less-trodden terrain. It begins by establishing a beachhead – a clear example of a duty to a non-party, as a proof of concept – before moving into rougher territory. Thus, it opens with an illustration of a duty created by the treaty establishing the International Centre for Settlement of Investment Disputes (“ICSID”): a tribunal must issue a written, reasoned award. After demonstrating that this first duty is owed to ICSID itself as an institution (as well as to the parties), the article adds other duties that investor-state arbitrators owe to arbitral institutions and to non-party participants in investment cases, including other states and non-government organizations. It then introduces the concept of systemic duties, which arbitrators owe not to particular persons, but to the creators of the investment arbitration system (states) and its ultimate beneficiaries (the global public). Finally, the article discusses how recognizing duties to non parties both informs a proper understanding of the investment arbitration system and may help improve that system.

Who wins in international investment arbitration disputes? Evidence from Latin American and Caribbean countries cases under ICSID

During the nineties, an important group of Latin American and the Caribbean (LAC) countries adhered to the International Center for Settlement of Investment Disputes (ICSID) as part of a program of measures that sought to attract foreign investment to the region. Using a dataset of 161 concluded disputes until 2019 corresponding to investments in LAC countries, we find evidence on the influence of parties’ characteristics, the subject discussed in cases, and characteristics of the tribunal on the arbitration outcomes. We find that 50% of tribunal decisions have been favorable to either claimant investors or host countries. However, this result may be subject to sample bias if information of settlements and discontinued cases is not taken under consideration. We also find evidence in favor of selection and party capability theories that helps to explain the determinants of international investment arbitration dispute outcomes. In particular, the results reveal that disputes related to direct expropriations have a relatively higher probability of being considered founded by tribunals than other legal controversies. Likewise, the indicators of the relative strength of parties, such as experience in international arbitration system, have an important influence on tribunal awards. Furthermore, country’s time of experience within ICSID is found to have an important influence on the selection of disputes.

Investor-State Arbitration: Economic and Empirical Perspectives

The investor-state arbitration system (“ISA”) was originally modelled on traditional commercial arbitration and was expected to deliver fast, good, and cheap decisions, especially in comparison to domestic court systems. Yet the ISA system has increasingly been criticized, especially by developing countries. Developing countries claim that the system is not cheap, that decision-making increasingly takes a long time, and that arbitrators are biased in favor of investors (often coming from developed countries in the global North) and against states from the developing South. Several developing states have even withdrawn from the ICSID Convention, which governs the settlement of disputes between investors and states through the institution of the same name. This article provides an economic and an empirical perspective on ISA: It reviews the traditional Law and Economics arguments in favor of and against international commercial arbitration, analyzing to what extent the characteristics of ISA make ISA different than international commercial arbitration. Moreover, the article summarizes the rich empirical literature on the functioning of ISA, and it compares and synthesizes this empirical literature with Law and Economics theories. Based on both Law and Economics and the empirical literature, the article then analyzes existing suggestions for reforming the ISA system.

On Construction of the Sport Arbitration System with Chinese Characteristics

Sports disputes; Sports arbitration; System construction; Chinese Characteristics

A cascade steering shared controller with dual-level dynamic authority

Abstract Advanced Driver Assistance Systems (ADAS) that consider the driver in the control loop (Shared Control ADAS) have the potential to influence upcoming functionalities in partially automated vehicles, improving the driving performance, reducing the workload, and increasing safety. According to the literature, two design parameters are relevant based on the cognitive level of the driving task. First, at the operational level, the steering controller must have a variable Level of Haptic Authority (LoHA), demanding more or less effort from the driver to override the system. Secondly, the tactical level needs an arbitration system to manage the transitions from manual-to-automated and automated-to-manual safely and progressively, with a variable Level of Shared Authority (LoSA). Based on these premises, this paper presents a cascade steering shared controller with a dual-level authority. The operational level consists of a hybrid MPC-PD controller, and the tactical level uses a Fuzzy Inference System (FIS). Results show the benefits of the system, assisting the driver in a collaborative overtaking maneuver.

论在上海自贸区推行航空临时仲裁——以横琴自由贸易试验区临时仲裁制度为借鉴

论在上海自贸区推行航空临时仲裁——以横琴自由贸易试验区临时仲裁制度为借鉴

The Extent of Arbitration's Preference and Independence over the Judicial System in Disputes Resolution Selection: A Re-Evaluation for Developing Judiciary and Arbitration Systems

The arbitration system is considered to be the most effective and efficient way of dispute resolution than the judicial litigation system. This opinion is based on several reasons such as time speed, confidentiality, flexibility, and so forth. Therefore, arbitration is considered to be able to present preference and independence in dispute resolution. However, this assumption needs to be assessed scientifically in accordance with existing realities. Hence, this article is to compare between the arbitration and other litigation systems in terms of their advantages and disadvantages. It found that arbitration was present in response to the weaknesses of the rigid justice system and its lack of creativity in creating mechanisms for disputes between disputing parties. Despite the fact, the arbitration system, in some cases, does not have independence precisely because of its flexibility, confidentiality and lack of supervision. Thus this article confirms that the actual arbitration system does not have preferences and independence that far exceeds the general litigation justice system. In other words, the advantages of the arbitration system do not exceed that of the general justice system except for its flexibility in handling unique disputes.Keywords: Arbitration system – Judicial system – needs of developing for resolving the disputes.

The Spanish and Portuguese Systems: Two Examples Calling for a Further Reform – Uncovering the Architecture Underlying the New Consumer ADR/ODR European Framework

The article scrutinizes the European Framework for consumer ADR and ODR with the purpose of uncovering how Europe aims to develop ADR and ODR in EU MS in order to deliver justice and ensure a better enforcement of EU consumer protection rules and a better functioning of the markets. It deepens on the transformations in the ADR systems required to better fulfil the new functions assumed by the certified ADR entities and the role that the technology may play inside efficient certified consumer ADR entities. The domestic implementation of EU law in Spain and Portugal rather seems to perpetuate the pre-existing systems although wrapped up in European packaging with a ribbon on top. The exam reveals the existence of a further path for improvement and for obtaining additional advantages that could lead to a better functioning of the markets and a more suitable encompass with the philosophy that underlies the EU Regulatory Framework. The article explores different ways to move forward and achieve a higher degree of compliance with the ADR/ODR Regulatory Framework. ADR, ODR, Consumer Redress, European Regulatory Framework, Consumer Arbitration System, Spanish Law, Portuguese Law.

Human Rights and IP in Investor to State Dispute Settlement

As the few existing intellectual property (IP) related investment arbitration awards demonstrate, human rights issues such as protection of public health might appear in such contexts, making IP-related investment disputes prone to human rights argumentation. The chapter focuses on the overlap of human rights, IP and IIAs. It evaluates the impact human rights have had on the relevant ISDS practices. The main emphasis is on the reasons for the increasing overlaps and the ways in which investment tribunals should approach them. The chapter rejects human rights proportionality as the proposed solution to increase the legitimacy of investment treaty arbitration. Through proportionality, courts seek to define an appropriate relationship between different conflicting interests at hand, each entitled to legal protection. Instead of suggesting a broad integration of human rights law under the investment tribunals’ operational sources of law, the chapter posits that a more legitimate way forward – pending more profound reform of the whole investment arbitration system – would be to decrease the overlaps through IIA design and to develop deference as an approach in ISDS, especially through the doctrine of margin of appreciation. The problem is not too little human rights in ISDS but too extensively applied and interpreted investment treaty standards, encroaching on host states’ regulatory powers and ability to protect and fulfil human rights obligations.

Paradigm shift; the emergence of arbitral forum shopping in CPEC investment disputes

Purpose The phenomena of arbitral forum shopping to resolve a commercial investment dispute is still under development and more complicated in many states. However, for Pakistan, it seems in an evolutionary phase, where the country is struggling hard to adopt the best practice of dispute resolution through forum shopping clauses. This struggle is even more inflated with huge Chinese investment through China Pakistan economic corridor (CPEC) projects in Pakistan, which come alongside with commercial investment disputes. For this purpose, the current treaty or contract-based system between China and Pakistan and litigation based domestic civil court structure look obsolete, hence, appear to require reinstatement of forum shopping clauses under concerned treaties or contracts for CPEC investment-related issues. Design/methodology/approach The authors choose a legal research method. The research design is a comparative analysis between CPEC contracts and dispute resolution mechanism between China and Pakistan and also the domestic civil court’s litigation system. This analysis selected by the authors due to inefficient bilateral investment arrangements and efficient resolution of future commercial disputes in CPEC. While the international arbitration system is included in the assessment were particular in the time and space context. The comparison comprises on dispute resolution clauses in free trade agreement (FTA) and bilateral investment treaties (BIT) between China and Pakistan and the system of resolving disputes by CPEC clauses. Findings The authors finds that in the absence of CPEC forum shopping clause under dispute resolution system, Pakistan is highly at risk to lose foreign investors, and therefore, set back the goal of long term economic sustainability in the region. However, China has already made its investment policies safer with establishing three international commercial courts (also referred to as Belt and Road courts), one in Xi’an for the land-based Silk Road Economic Belt, one in Shenzhen for the Maritime Silk Road and one in Beijing that will serve as the headquarters. These courts will be offering litigation, arbitration and mediation services. According to one view, China aims to have all belt and road initiative (BRI) disputes resolved by these courts. This makes Pakistan position more awkward and needs proactive measures, as CPEC investment is based on Pakistan foreign direct investment policies and legal structure. Therefore, it will be complicated and less favourable for Pakistan to deal with such cases under Chinese Courts. Originality/value The paper’s primary contribution is finding that comprehensive analysis of alternative dispute resolution mechanism between China and Pakistan over CPEC investment is inevitable. A socio-legal research combine with an examination of Singapore International Commercial Court functions and mechanism and CPEC plans further contributes to ascertain the best model of the settlement of commercial disputes under investments in Pakistan. This research paper anticipates future economic and legal problems, which Pakistan may encounter.

Diclosure Of Thirs-Party Funding Arrangements aand The Existence of Third-Party Funders in International Investment Arbitration

Third-party funding has been commonly used in International Investment Arbitration. Third-party funders increasingly usually finance the claimant who either (i) does not have sufficient funding to start legal proceedings, or (ii) adequately capitalized, but seek funding in order to minimize cash flow disruption and share risk during their arbitration proceedings. However, the notion of third-party funding gives rise to several issues; first, should funded parties be required to disclose their funding arrangements? Following the first research question, when does the funded party need to disclose the existence of a third-party funder? Then what legal measures can be taken to tackle the concern of transparency and disclosure in cases involving third-party funding? This research concentrates on the transparency and disclosure requirements, which is the central issue that influences further development and use of third-party funding arrangements in international arbitration. Analysis of relevant treaties, laws, guidelines, and case laws drives us to the conclusion that there exist measures and several drains the current international arbitration system that will serve a transparency system to control third-party funding. Hence, it would be appropriate for arbitration institute or investment treaties to take these tools into account in order to provide legal certainty for the disputing parties, arbitral tribunal, and ultimately, for the legal framework of third-party funding in investment arbitration..

CAMON: Low-Cost Silicon Photonic Chiplet for Manycore Processors

While many new applications prefer manycore processor with a large number of cores, the exploding communications among multiple cores, caches, and off-chip memories is posing a fundamental challenge on manycore designs. Silicon photonics-based interconnection network promises high bandwidth, low latency, and high energy efficiency, and can potentially meet the communication requirements of manycore processors. In this paper, we propose CAMON, a small low-cost silicon photonic chiplet integrated into the manycore processor package. CAMON chiplet can effectively alleviate the communication bottlenecks of manycore processors and improve the energy efficiency of data movement, especially for large-scale systems. We develop a distributed arbitration system, a low-power low-latency optical interface, and an off-chip laser preactivation mechanism for CAMON. The experimental results show that compared with the electrical network, CAMON can improve the full-system performance per energy by $4.6\times $ , speedup the manycore processor by $2.7\times $ , and save the area of the processor die by 3%, in a 512-core system.

Three Approaches to Challenges of ICSID Arbitrators for Manifest Lack of Reliability for Independent Judgment

Article 14(1) of the ICSID Convention sets forth certain qualities that all ICSID arbitrators must possess. They must, in the words of Article 14(1), be “persons of high moral quality and recognized competence in the fields of law, commerce, industry or finance, who may be relied upon to exercise independent judgment.” In accordance with Article 57 of the ICSID Convention, a party may propose the disqualification of an arbitrator—or in briefer terms, challenge him or her— “on account of any fact indicating a manifest lack of the qualities required” by Article 14(1). Pursuant to Article 58 of the Convention, the decision on a proposal to disqualify an arbitrator will be taken by the other members of the tribunal, unless they are equally divided or the proposal relates to a sole arbitrator or the majority of the arbitrators, in which cases the decision will be taken by the Chairman of the Administrative Council of ICSID (the President of the World Bank). Parties to ICSID Convention arbitration cases have frequently set in motion the challenge procedures of Articles 57 and 58. Proposals to disqualify arbitrators have been made in over 100 such cases. About a quarter of the disqualification proposals have been met by resignations of the challenged arbitrators. Almost all the other proposals have been rejected by decision of the unchallenged arbitrators or of the Chairman of the Administrative Council.The decided proposals all apparently sought disqualification owing to a supposed manifest lack of reliability for independent judgment. The decisions themselves, however, have taken different approaches to the standard to be applied for disqualification, that there be a fact indicating a manifest lack of the required quality.Three main approaches can be discerned from the cases.They are examined in this article through the lenses of the individual decisions that inaugurated or prominently reinforced the respective approaches.Albeit in varying degrees, the approaches identified with these decisions have each highlighted a weakness of the disqualification procedures of the ICSID Convention, that they may less adequately guarantee arbitral independence than the corresponding procedures of leading international commercial arbitration systems. A concluding part of the article considers the scope for addressing the problem through amendments of the ICSID Arbitration Rules.

Judicial Hostility in the Nigerian Arbitration; the Way Forward

In Nigeria, it can be said that one of the traditional methods of settling disputes is arbitration. Over the years this method has been affected by civilization and has thus become a modern day thing with the constant interference of the state. The Judiciary now has a say over litigation thereby making its status as an alternative dispute resolution mechanism sometimes disputable. This article undertakes the workings of arbitration in Nigeria, different instances of judicial interference with arbitration in Nigeria. The article discovered that one of the problems faced by arbitration in Nigeria is judicial hostility which affects the arbitral proceedings as well as the enforcement of the arbitral award. This article seeks to look at the possibility of having an autonomous arbitration system; a system free of all forms of judicial interference in arbitration in Nigeria Finally, this article concludes that for there to be enforceable arbitration in Nigeria, judicial hostility towards arbitration has to be eradicated and thus recommended that the current Law governing arbitration in Nigeria, that is the Arbitration and Conciliation Act should be amended and be made free of all provisions allowing judicial interference with arbitration.

Investment Arbitration and Political Systems Theory

This chapter suggests that political systems theory allows us to make better sense of the fragmented understanding we have today of investment law in general and of investment arbitration in particular. Relying on a theory by David Easton, the chapter presents investment arbitration as a political system: one that transforms the input of key actors into output, with feedback loops from the latter to the former. This perspective, the chapter contends, helps us get a better sense of some of the system’s key dynamics, including its conditions of stability, factors and direction of change, and the functions it is effectively called upon to fulfill. It grounds the discussion of the drivers of investment arbitration more closely in reality than do the common references to notions of obsolescing bargain, credible commitment, promotion of the rule of law, and development of sensible rules of state behaviour.

Provisional Measures in Investor-State Arbitration: States Playing Games in Local Courts by Invoking the Trump Card (Police Powers)

This paper outlines arbitral tribunals’ power to order provisional measures under the auspices of I.C.S.I.D. Arbitration; that is, investor-state arbitration. The scope of a tribunal’s power is cumbersome to discern, especially when there are possible interferences with state sovereignty. More recently, tribunals have ordered provisional measures to suspend a domestic criminal investigation or proceeding. Is this an infringement on a states sovereign prerogatives or a response to, for example, dilatory tactics by a rogue state? The crux of the issue is this: a state will always be in a position to utilize its prosecutorial powers in order to frustrate the arbitration by putting immense pressure on the investor, its employees, or its witnesses, in other words: “playing games” in local courts. In order to guarantee procedural integrity of the arbitration and, as a corollary, the legitimacy of investor-state arbitration in its entirety, the provisional measure is a practical tool that can be used effectively. On a similar vein, “sovereignty” should not force tribunals to tie their hands when serious interference with the arbitral procedure is making the procedure unfair at best,or a nullity at worst. However, legal text both empowers and constrains the tribunal. The I.C.S.I.D. Convention only allows a tribunal to “recommend” provisional measures. As seen in light of investor-state case law, in an informal (perhaps de facto) stare decisis context, a number of tribunals seem to have justified the ordering of provisional measures. In the shadow of this construction lurks the de-legitimizing of the entire investor-state arbitration system. At the same time, rogue sovereigns playing games in local courts have the same de-legitimizing effect.

The Multilateral Investment Court: A Stumbling Block for Comprehensive and Sustainable Investment Law Reform

For the last years, reforming the international investment law regime has been a key priority of the trade agenda of the European Commission. Two important decisions in March 2018 can either be seen as a stepping stone or stumbling block in this regard. On 20 March 2018, the Council authorised negotiations for a treaty establishing a multilateral investment court (MIC). This proposal was yet the latest step in a series of activities aimed at replacing the traditional arbitration system of dispute settlement in investment treaties (Investor-State Dispute Settlement, ISDS) with a treaty-based MIC. The latest development concerns the multilateralization of the Investment Court System leading to a MIC. After lobbying for this approach in various intergovernmental fora, the Commission developed a more concrete proposal over the course of 2016 and the first half of 2017. Last year, the ISDS debate moved into the auspices of UNCITRAL Working Group III. Neither the negotiation mandate nor the UNCITRAL mandate touch upon substantive investment standards or refer to the current debates and negotiations on business and human rights. The negotiations will therefore not address any substantive elements of investment treaties. In all likelihood, they will also not address procedural issues such as counterclaims, participation rights of affected stakeholders, presumption of responsibility or burden of proof. The second important decision was taken two weeks earlier by the Court of Justice of the European Union (CJEU) on 6 March 2018. In its ruling in the case C-284/16 Achmea, the CJEU clarified that investment agreements between EU Member States (so-called intra-EU BITs) that have an ISDS clause violate EU law. It is not quite clear whether the CJEU would also transfer its view to other agreements such as CETA or the planned treaty for a MIC. However, the ruling indicates that any investment agreement providing for dispute settlement procedures in which EU law can be applied or interpreted and which does not ensure a review of this interpretation by the CJEU is in breach of EU law.

‘Foreign Elements’ in the Arbitration of China’s Free Trade Zones

Since the traditional definition of ‘foreign elements’ cannot meet the new requirements of the arbitration of China’s FTZs, Chinese judicial practice must create a useful supplement to already established standards. In free trade zone arbitration cases, Chinese courts determine foreign elements based on the standards of subject, object, and legal facts. In this regard, the explanation for ‘other circumstances’ in the First Judicial Interpretation of the Supreme Court on Several Issues Concerning the Application of Law of the PRC on Foreign-Related Relations is based on the three abovementioned elements. The Chinese arbitration system and legislation must be further perfected; however, overly broad standards may impede China’s domestic arbitration system. Moreover, China must add certain restrictions to the standards: judges should distinguish the artificial foreign elements created by contracting parties, controversial civil relations should have a material connection with foreign countries, and discretion should be reasonable with sufficient nucleus.

Smart Line Judgement System: A Novel Technology in Vol-leyball Arbitration

<p class="BodyText1">Within previous decade, sensitivity to arbitration systems in sports such as soccer, tennis and volleyball has been sharply increased and technicians turned to new technologies to fulfill the demands for a reliable judgement. The main purpose of this study was to address a new method in judgement of presence of ball in the volleyball field in the shortest possible time by manipulation of lines surrounded the field and the ball layer’s structure. A carbon semi- conducting fabric layer designed ball was thrown to the printed circuit board (PCB), which have replaced the surrounded field lines. The ball was thrown in six different angles of 15, 30, 45, 60, 75, and 90 degrees and with 20 and 40 m.s-1 speed. As soon as the semiconducting ball hits the PCB lines, the LED, which embedded under the PCB, turns on and announce the presence of the ball in the field. In 20 m.s-1 speed, the PCB detected 97.1% of ball presence in the field per 1500 trials six angles. Almost similar, in 40 m.s-1 speed, the accuracy of PCB in hit detection was 97.6% per 1500 trails. Additionally, regardless of ball speed, the more perpendicular the ball hit the PCB line, the accurate detection was made. The smart line judgment system could be a reliable, efficient, and affordable technology that provide referees with an accurate decision and athletes with a faster game flow. </p>

Why Europe Should Reconsider its Anti-Arbitration Policy in Investment Disputes

This paper addresses the current challenges to investor-state arbitration in Europe. Two parallel developments are outlined: the current change in the EU policy towards arbitration provisions in multilateral and bilateral investment treaties, and the consequences of the Achmea case decided by the Court of Justice of the European Union in March 2018. The author analyses the critical arguments behind the current European anti-arbitration stance and concludes that while some of them (but not all) may have some foundation, a sufficient number of reasons speak against the radical dismantling of the system of international investment arbitration. An analysis of the proposed alternatives shows that they fail to deliver viable solutions for diagnosed problems. In particular, the replacement of ad hoc tribunals by a multilateral investment court (MIC) seems to be a step in the wrong direction. The ISDS has played an important role in the global fostering of international investment by securing a basically fair system of dispute resolution in a very specific field. Its deficiencies are not beyond repair; on the other hand, the alternatives offered suffer from flaws that are the same or much more troubling. The author concludes that the consequences of the ‘change of tide’ in the approach to investor-state dispute resolution are likely to be detrimental to the very goals of those who advocate the abandoning of investment arbitration.