Dispute Settlement Provisions Research Articles

Dispute Settlement Provisions in the Agreement for Biodiversity beyond National Jurisdiction

Abstract This article explores the dispute settlement provisions of the New Agreement for the Conservation and Sustainable Use of Marine Biodiversity beyond National Jurisdiction (the bbnj Agreement). The history of the discussions behind many of the key features of article 60, are explained. These included whether to allow compulsory dispute settlement, exclusions from jurisdiction and how non-Parties to the United Nations Convention on the Law of the Sea (unclos) would be covered. The article concludes with some possible issues that may arise when the articles are put into practice.

Impacts of deep trade agreements on trade and welfare – An application to China joining the RCEP and CPTPP

Using a quantitative trade model, this paper evaluates the trade and welfare effects of deep trade agreements in an application to China joining the RCEP and CPTPP. By feeding trade cost shocks from the changes in RTA deepness into the model, we find substantial gains from incorporating legal enforceability and dispute settlement provisions in both agreements. With the CPTPP being deeper than the RCEP, our counterfactual exercise of China joining the CPTPP shows that 69% of its welfare gains come from deepening RCEP provisions to the CPTPP level. For the RCEP members, the gains from deepening non-tariff-related core provisions are quantitatively important.

Legal Risk in Transnational Investment and Its Countermeasures

In today's world, economic globalization has become an irreversible trend. Various countries and regions are gradually becoming important entities in economic globalization. Transnational investment faces a number of legal challenges and risks, including investment restrictions, differences in legal systems, corrupt practices and dispute settlement mechanisms. To address these issues, investors should have a thorough understanding of the legal differences between their home and host countries, make use of international treaties and agreements, and improve dispute settlement mechanisms in bilateral agreements. To draft a clear and comprehensive investment agreement that defines the rights and obligations of the parties involved and includes dispute settlement provisions, in addition, investors should assess and address potential legal risks through due diligence, diversification of investments, purchase of loss insurance and use of entities that provide legal protection. The need to prioritize legal considerations is essential to successful cross-border investments and to protect investments in global markets.

BIT·FTA상 외국인투자심사 실행에 관한 연구

Countries with foreign investment screening mechanism have developed practices to avoid international investment disputes. These practices include using security exceptions, exceptions to dispute settlement provisions, and schedules to Annex regarding non-conforming measures in investment agreements. These practices do not specify specific national security requirements and are subject to full self-judgment. Countries with a long history of foreign investment screening, such as the United States, Canada, and Australia, actively use these practices to exclude foreign investment screening from international agreement obligations. These countries interpret the national security exception jurisprudence as applying to foreign investment screening, meaning that foreign investment screening is entirely self-judged.
 However, South Korea does not have a consistent approach to foreign investment screening in its Bilateral Investment Treaties (BITs) and Free Trade Agreements (FTAs). The security exception clause in these agreements is different in each agreement, and the contents of the reservations are not uniform. However, it can be interpreted that Korea has decided to treat foreign investment screening as an exception to international law, since it joined the Regional Comprehensive Economic Partnership (RCEP), which stipulates that the screening regime shall not be subject to the dispute settlement provisions.
 Foreign investment screening is likely to become more important as a policy tool in the era of expanding national security. The concept of national security has evolved from being applied only in exceptional emergencies such as war to encompassing more permanent situations such as economic security, high-tech protection, supply chain crisis response, and climate change. State measures to protect national security have also become more permanent. Given these circumstances, it is important to reconsider whether it is appropriate to treat foreign investment screening as an exception to international law. Allowing foreign investment screening as an exception to international law could lead to a crisis in the international legal system due to potential abuse of this exception. However, from the government's perspective, securing policy space for foreign investment screening can be advantageous in effectively addressing the growing threat to national security. Therefore, it is crucial to contemplate the stance and standards that should be established for the foreign investment screening practice in Korea moving forward.

A Study on China's Digital Trade Dispute Settlement Mechanism in the Perspective of CPTPP

In the rapid development of digital trade, the digital trade dispute settlement mechanism also needs to be updated and adapted accordingly, thus promoting China's discursive and equal participation in world digital trade. The volume of digital trade in China is growing rapidly, yet the corresponding digital trade dispute settlement mechanism has not yet formed a sound system. This contradiction has become an urgent problem to be improved and solved in the field of digital trade in China. By comparing the digital trade dispute settlement provisions between China's FTA and CPTPP, this paper analyzes the deficiencies of China's relevant provisions in terms of openness, procedure, and efficiency. Most of these deficiencies originate from the lagging nature of China's digital trade provisions and the imperfection of procedures. Based on this, this paper provides suggestions respectively on the problems above. This includes making special provisions for dispute settlement in the field of digital trade, improving the provisions on suspension of concessions, and establishing rules ensuring transparency. Specifically, this put a high bar on the selection of panelists, the public enclosure of hearings and documents, and the application of the Third-Party participation principle.

Standing in international investment and trade disputes

International investment agreements employ dispute settlement procedures that differ markedly from their counterparts in trade agreements. A prominent and controversial difference arises with respect to the issue of “standing”: Who has the right to complain to adjudicators about a violation of the agreement? While trade agreements limit standing to the member governments (state-to-state dispute settlement), investment agreements routinely extend standing to private investors as well (investor-state dispute settlement). We develop parallel models of trade and investment agreements and employ them to study this difference. We find that the difference in standing between trade and investment agreements can be understood as deriving from the fundamentally different problems that these agreements are designed to solve. Our analysis also identifies some important qualifications to the case for including investor-state dispute settlement provisions in investment agreements, thereby offering a potential explanation for the strong political controversy associated with these provisions.

The Place of Non-Aggravation in the Peaceful Settlement of Territorial and Maritime Disputes

The present paper argues that the ‘non-aggravation of disputes’ is a fundamental principle of international law. Evidence of the non-aggravation of disputes as a principle of international law has long existed in the work of qualified publicists and in numerous multilateral treaties with dispute settlement provisions, including the UN Convention on the Law of the Sea. International courts and tribunals have indicated ‘non-aggravation measures’ to preserve the subject matter of the dispute and the rights of either party to the dispute. The principle of non-aggravation is gaining recognition and importance in the broader context of the peaceful settlement of international disputes, particularly territorial and maritime disputes which are often prone to armed escalation and pose risks to peace and security.

Maritime Dispute Settlement in Southeast Asia: Bargaining under the Shadow of the LOSC

Abstract The UN Convention on the Law of the Sea (LOSC) has influenced the thinking and negotiating practices of States in Southeast Asia, providing them more common ground and at times bones of contention. Overcoming their traditional reluctance, Southeast Asian countries have become more open to the dispute settlement provisions under Part XV of the LOSC. The rulings in the arbitral and judicial cases from the region and elsewhere have provided ample guidance to States in their dealings with and among each other. Nonetheless, the management and resolution of the long-standing competing maritime claims in the South China Sea have thus far eluded them. Negotiations on a proposed code of conduct have gone on for years and remain a work in progress.

The Dilemma of Consent to International Arbitration in Investment Agreements without a Forum

Abstract This monograph addresses the sometimes overlooked yet fundamental principle that consent to international arbitration is forum-specific, and explores its significance and practical consequences in investment arbitration. This monograph contends that if there is no arbitral forum mentioned in the relevant dispute settlement provision of an investment agreement, the forum specified therein becomes unavailable for some reason, or a subsequent agreement on a forum is required between the parties to the dispute, there is only consent “in principle” to international arbitration in the investment agreement. Such expression of “consent” is unenforceable and ineffective, which means that a foreign investor would not be entitled to unilaterally initiate an investment claim against the host State under said agreement absent a subsequent agreement between the foreign investor and the host State on an arbitral forum. This monograph also shows that there is an explicit requirement of a forum-specific consent in the arbitral rules of the often-used arbitral institutions. In addition, the most-favored nation clause in investment agreements could not be applied to overcome the lack of forum in dispute settlement provisions. Finally, this monograph proposes possible avenues to tackle the absence of an agreed-upon forum in an investor-State dispute settlement provision, draws some conclusions and warns against the dangerous consequences of ignoring this basic principle.

Comparison of Dispute Resolution Provisions between the Joint Contract Tribunal and the Iraqi Standard Bidding Document

Due to a party's violation of his obligations or responsibilities indicated in the contract, many engineering projects confront extensive contractual disputes, which in turn need arbitration or other forms of dispute resolution, which negatively impact the project's outcome. Each contract has its terms for dispute resolution. Therefore, this paper aims to study the provisions for dispute resolution according to Iraqi (SBDW) and the JCT (SBC/Q2016) and also to show the extent of the difference between the two contracts in the application of these provisions. The methodology includes a detailed study of the dispute settlement provisions for both contracts with a comparative analysis to identify the differences in the application of these provisions between the two contracts. The research results revealed several differences, the most important of which is that the engineer has a dual role in Iraqi (SBDW). On the one hand, he is appointed by the employer to carry out specific duties under the contract. On the other hand, the engineer also has powers related to the settlement of claims and this first level of conflict avoidance between the two parties, Unlike the SBC/Q2016 contract, which appoints a neutral third party to mediate the problem. In addition, resolving disputes between the two parties, according to the ‎Iraqi (SBDW), needs a long time compared with JCT-SBC/Q2016.‎

Extension of the Most Favoured Nation Clause to Dispute Settlement Provisions in Bilateral Investment Treaties Which Turkey is a Party of

Extension of the Most Favoured Nation Clause to Dispute Settlement Provisions in Bilateral Investment Treaties Which Turkey is a Party of

Withdrawal from mixed agreements under EU law: the case of the Energy Charter Treaty

This article argues that under EU law, the EU and its Member States can withdraw from a multilateral agreement such as the Energy Charter Treaty independently of one other. While loyalty obligations may require the EU and its Member States to coordinate their actions under a mixed agreement closely, all can withdraw. The autonomous nature of EU law does not allow Member States to prevent the EU from taking decisions within its competence. Similarly, as the European Court of Justice maintains, under EU law, the EU and its Member States are only ratifying those parts of the agreement that fall within their competence – thus, Member States are entitled to cease exercising their powers through withdrawal. However, this power to withdraw unilaterally is not without complications. First, it may affect the ability of others to remain a party to the Energy Charter Treaty under EU law. Second, where not all Member States and the EU withdraw, ‘incomplete mixity’ raises several complicated questions under international law, particularly those concerning international responsibility and investor-state dispute settlement provisions. Coordinated withdrawal by all Member States and the EU is, therefore, the preferred policy option.

Legal Framework for Securities Market Dispute Resolution in Nepal

Dispute settlement provisions are crucial segments of the securities law for each and every jurisdiction as recognized within core objectives of the securities regulation even by International Organization of the Securities Commissions. This article deals mainly with the questions on how far the dispute settlement provisions in Nepali securities law are adequate to redress and compensate the investors for actual losses resulting from market malpractices. Employing doctrinal legal research followed by in-depth key informant interview with the regulatory representatives, experts and market participants to conduct the study, it is based on descriptive, analytical and interpretative in research design. Drawing upon the analysis of the existing grievances handling mechanism and securities dispute settlement practices, the author concludes that law on securities dispute settlement regime is quite scattered and it seems urgent to have a consolidated approach to bring them at one place within a separate regulation. The study recommends the concerned authorities to restructure the securities dispute settlement regime by means of amendment of the existing securities law to provide a Securities Dispute Settlement Committee under the aegis of the regulator Securities Board of Nepal, which could function as a first-tier quasi-judicial body to look and decide over all kinds of securities disputes. Likewise, the concerned authorities are recommended to pass a separate legislation to establish and form an independent Securities Market Dispute Settlement Tribunal having its jurisdiction to hear an appeal against the decision of the proposed Dispute Settlement Committee under the Securities Board of Nepal.

An optimal investor-state dispute settlement mechanism

Many investment treaties include investor-state dispute settlement (ISDS) provisions which are supposed to protect a foreign investor against opportunistic behavior of a host country. This paper scrutinizes the optimal design of ISDS provisions that solve the holdup problem. It shows that an efficient investor protection mechanism requires an arbitrator as established in investment treaties. However, this arbitrator does neither have to learn nor to evaluate the circumstances of the dispute. Furthermore, any ISDS compensation from the government to the investor should not be based on reductions in investor profits but on the host country’s welfare effects.

The growing pains of actorness: the European Union in global investment governance

ABSTRACT Foreign investment is governed by thousands of international investment agreements (IIAs), many of which include investor-state dispute settlement (ISDS) provisions. Member states have played a prominent role in the evolution and shape of this decentralized global investment regime. The EU itself has become an actor in this regime since gaining competence in this area in 2009. This article examines the manners by which investment policies of the EU and its member states have evolved over time and their implications for the EU’s actorness. Using, first, the concept and metric of state regulatory space, we show that the EU is more enthusiastic than its member states about reforms, but that a lack of internal cohesiveness and a competitive external environment limit its actorness. Second, drawing on recent discussions on ISDS reforms, we highlight the increasing ability of the EU to speak up with one voice on global investment rules.

Application of Dispute Settlement in Free Trade Agreements (FTAs’): A Cross Country Analysis of Modern FTAs’

Most modern free trade agreements (FTAs’) include chapters on a variety of topics such as investment, digital trade, labour, gender, environment and small-medium enterprises. These new issues are often addressed in FTAs’ as there is a lack of development of multilateral rules on these areas at the World Trade Organization (WTO). Further, many of these aspects are non-trade issuesviz. environment, labour, competition policy, and investment. These areas are contentious and often face opposition from the Global South and are frequently excluded from the scope of dispute settlement. Against this background, this article examines the trends with respect to the application of the dispute settlement across recent FTAs’ concluded by certain developed countries such as the United States, Canada, Australia, the European Union (EU) and the United Kingdom (UK). This article examines recent FTAs’ and categorizes its chapters as follows: (1) Chapters always subject to dispute settlement, (2) Chapters not subjected to dispute settlement and (3) Chapters that have inconsistent recourse to dispute settlement. Accordingly, the article provides a cross country assessment of the FTA chapters with dispute settlement provisions and the rationale behind such divergent practices. FTA, developed, non-trade, dispute settlement, sustainable trade, USMCA, gender, environment, labour, multilateralism.

EU-China Agreement on Investment: Lessons for India from the Sino-European Model

The European Union (EU) is the biggest source of outbound investment in the world and China is one of the top recipients of Foreign Direct Investment (FDI). The EU-China Comprehensive Agreement on Investment (CAI) is a unique international investment agreement that reflects the evolving economic relations of the EU and China and their strategic partnership. It also serves as one of the latest examples of the ever-evolving legal approach of the EU concerning international investment, particularly the dispute settlement mechanism in the CAI. This is why CAI might hold lessons for India, which also has a complex experience with its international investment agreements (IIAs), particularly the dispute settlement. Against this background, this article critically examines the dispute settlement provision of the CAI, its implications and lessons for India in the wake of renegotiation of the India-EU Broad-based Trade and Investment Agreement (BTIA). dispute settlement, international economic law, international investment agreements, European Union-China relations, Indian Model BIT, trade and investment law

Conciliation and Mediation in Investor-State Dispute Settlement Provisions: A Quantitative and Qualitative Analysis

Abstract The article sets out the results of an extensive review of conciliation and/or mediation in investor-State dispute settlement (ISDS) provisions contained in international investment agreements (IIAs). Out of 3815 IIAs that were initially screened, 2674 (ie 70 per cent) do not refer to such provisions. The research also revealed that while the number of IIAs signed each year with investor-State conciliation provisions have significantly decreased, IIAs signed with investor-State mediation provisions are gradually increasing. The screening identified 1125 IIAs that contain investor-State conciliation provisions, of which 806 (ie 71.6 per cent) provide advance consent to conciliation. In comparison, of the 53 IIAs that were found to contain investor-State mediation provisions, only seven (ie 13.2 per cent) offer advance consent to mediation. Advance consent to ‘conciliation or arbitration’ was identified in 703 IIAs. The authors outline arguments to show that the conjunction ‘or’ in these provisions does not give rise to a fork in the road that precludes an investor’s right to arbitration if it first initiates conciliation proceedings. Only seven IIAs were found to require conciliation and/or mediation as a mandatory precondition to arbitration. The article concludes with recommendations to increase the use of investor-State conciliation and mediation provisions in future IIAs and also to improve the quality of those provisions.

ISDS Reform in the Context of China’s IIAs

Abstract The investor–state dispute settlement mechanism enables investors to seek remedies in the face of a violation of related international investment agreements, which are crucial to maintaining the standards of investor protection that have been consented to by the contracting parties. On the other hand, more and more problems in the system have been exposed as the number of investor–state dispute settlement cases has increased. These range from substantive issues, such as the treatment granted to investors, to procedural ones, such as cost management and related procedures. Debates on investor–state dispute settlement reform have led to various options for reshaping the relevant mechanisms. Amid the new trend of investment liberalization and facilitation, China is undergoing a new round of bilateral investment treaty revision and free trade agreement negotiation. How the investor–state dispute settlement process is to be framed boils down to how China assesses its own interest vis-à-vis its partners and how it prioritises its objectives in international investment agreement negotiation with its partners. It is submitted that China should take a calculated risk on the investor–state dispute settlement provisions in international investment agreements with adequate consideration of competing interests.

Enhancing Conflict Resolution ‘ASEAN Way’: The Dispute Settlement System of the Regional Comprehensive Economic Partnership

Abstract This article examines the dispute settlement system of the Regional Comprehensive Economic Partnership (RCEP), adopted under the auspices of ASEAN on 15 November 2020. RCEP’s Chapter 19 on dispute settlement confirms and enhances the so-called ‘ASEAN way’, which promotes flexibility, consensus and the avoidance of direct confrontation in resolving inter-State controversies. This article discusses how RCEP enhances the ‘ASEAN way’ by reference to certain significant provisions of Chapter 19, also by comparison to the dispute settlement provisions of the WTO’s Dispute Settlement Understanding and other ASEAN+1 Free Trade Agreements.