Permanent Court Of Arbitration Research Articles

China's Innovative ISDS Mechanisms and Their Implications

International arbitration before Western-based institutions is the dominant mode of investor-state dispute settlement (ISDS). The Washington-based International Centre for Settlement of Investment Disputes (ICSID), the Hague-based Permanent Court of Arbitration, the Arbitration Institute of the Stockholm Chamber of Commerce, and the International Court of Arbitration of the Paris-based International Chamber of Commerce handle the vast majority of the world's international investment disputes. ICSID alone administers over sixty percent of the cases, while the others account for an additional twenty percent. Yet China has begun to innovate in ISDS over the last few years. These innovations have taken three main forms. The first is the extension of the jurisdiction of existing commercial arbitral institutions in China to cover foreign investment disputes. The second is the creation of new Chinese courts to possibly handle contractual investment disputes. The third is the formation of joint arbitration centers with states in regions where China invests heavily, such as Africa. This essay describes these changes and argues that they should be understood as reflecting an important facet of China's broader international strategy. In particular, the recent innovations aim to furnish adequate protection to Chinese investors in foreign countries, particularly developing states; actively shape international discourses on international investment law; and offer alternative, Chinese-initiated institutions that will break the monopoly of the West.

The Permanent Court of Arbitration’s Exegesis of the Regime of Islands and China’s Nine-Dash-Line Claims in the South China Sea Arbitration

The big South China Sea is one of the most dangerous hotspot in the world. By words and actions, there are sixclaimants of the South China Sea. The People’s Republic of China and the Republic of the Philippines are some ofthem. Each want to control the numerous features and resources in boosting their economic interests. The UnitedNations was actively involved in the settlement of the disputes for their own security and economic interests. Thegreat ownership question that comes about in this is the rightful owner of the South China Sea which involved theNine-Dash Line claims by the government of the People’s Republic of China, which laid claims to the ParacelIslands, the Spratly Islands, the Pratas Islands, the Maccles field Bank and the Scarborough Shoal. In the Arbitrationbetween the two parties: China and Philippines, Annex VII of the United Nations Convention on the Law of the Seawas relied upon by the tribunal which gave award on 29th October, 2015 on admissibility and jurisdiction. Howeverthe objection that was presented by China was rejected by the tribunal. This was because of the issue of the territorialsovereignty of China in the South China Sea which was not within the jurisdiction of the tribunal. The tribunal foundinteralia that the submission made by Philippines showed the dispute between the parties putting in mind theConvention interpretation and application. The requirements under article 283 of the Convention were met by thePhilippines in regards to the settlement of the dispute. This paper examines the South China Sea arbitration awardand the interpretation and the application of the regime of islands under article 121 of the United Nations Conventionon the Law of the Sea.

ADVANTAGES OF NON-LEGAL METHODS OF DISPUTE SETTLEMENTS IN INTERNATIONAL SPACE LAW

INTRODUCTION:The law provides the rules and justification for dispute settlement. The evolution of international dispute settlement has following five phases:a)There was the concept of just war which allowed the enforcement of rights and obligations between states through a legally accepted use of armed force; b) Realization of the importance of peaceful settlement of dispute between states and before adhoc bodies; c) The establishment of Permanent Court of Arbitration (PCA) by 1899 treaty, with the awareness of the urgency to establish a standing body; d) The establishment of the Permanent Court of International Justice (PCIJ), International Court of Justice (ICJ), regional bodies such as European Court of Justice (ECJ), The European Court of Human Rights (ECHR) and International Center for the Settlement of Investment Disputes (ICSID) after World War II and in early 1980s; e) The established of various human rights commissions and tribunals (Rosanne, 1991: 4).These evolutions show clear inclinations away from the use of force and dispute settlement towards recourse to third party compulsory mandatory jurisdiction and binding decision making powers. Generally speaking, a dispute occurs when a party perceives itself to be injured; decide some other party is responsible; from a sense of entitlement to some kind of redress, and formulate a specific claim which is rejected by the other party. The method of dispute settlement to be chosen by parties depends upon following factors:a)The extent of the interaction and interdependence of the actors involved; b) Whether the parties are in a continuing relationship with each other, their relative bargaining power and ability to exert influence on each other; c) Their geographical and political relationship with each other and third party; d) The similarities or differences in their political, cultural or economic ideology; e) The history of their relationships and the methods of dispute settlement used in the past between them; and, f) Their respective commitments to international law and principle of peaceful settlement of dispute (Surds & Shany, 1999:28).The Charter of United Nations (UN) provides, in Art. 2(3) and (4), two parallel obligations, requiring all members to settle their international disputes by peaceful means in a manner that international peace and security and justice are not endangered; and to refrain from any treat or use of force in their international relations against the territorial integrity or political independence of any state, or in any other manner inconsistent with the purpose(s) of the UN (Watts, 2001:21). Article 33 of the charter of UN requires that parties of any disputes which the continuance of it is likely to endanger the maintenance of international peace and security shall first of all seek a solution by negotiation, equity, mediation, conclusion, arbitration, judicial settlement, resort to regional agencies or arrangement (Watts, 2001:21).In this paper we are about to analyze advantages and disadvantages of non-legal methods of peaceful settlement of conflicts arises in space activities, which are consultations, negotiations, inquiry and fact finding, mediation and good offices, conciliation and the claims commission (CC).NON-LEGAL DISPUTE SETTLEMENT METHODS RECOMMENDED BY SPACE TREATIES: CONSULTATIONS:Consultations and prior notification is one of the most useful methods of dispute settlement and conflict avoidance techniques. This method requires a party that might adversely affect another party, to inform the other party of its intentions and to discuss the matter and avoid any disputes. Some advantages of this method are as follows:a) Advocating a Pre-emptive and early resolution of a dispute by permitting parties to identify and attempt the settlement of potential problems at an early stage through taking action before parties' positions become rigid and polarized and their difference become more critical and intractable. …

International Court of Justice Arbitral Award in the Case of the Republic of the Philippines v. the People’s Republic of China: A Daniel Come to Judgement?

On 26 July 2016, the Permanent Court of Arbitration at The Hague released the International Court of Justice Arbitral Award in the case of the Republic of the Philippines v. the People’s Republic of China upholding the “Submissions” made by the Philippines and invalidating China’s “nine-dash line.” Almost ten months thereafter, and in response to the decision of the present administration not to include the discussion of the said award in the agenda for the 30th ASEAN Summit and Related Meetings on April 26-29, 2017 in Manila, Philippines, the former Department of Foreign Affairs (DFA) Secretary Albert del Rosario, who led the Philippines in filing the arbitration case against China in the international tribunal, criticized the inaction of the present administration in “asserting the ruling of a United Nations-backed arbitral tribunal over the South China Sea.” We cannot wait for a ‘better time’ to come — we must create that time ourselves lest that opportunity be lost forever, Del Rosario said in a speech during a South China Sea forum organized by Stratbase ADR Institute on 4 May 2017. Was the former DFA Secretary correct? Has the Philippines lost any opportunity that the said award had given it in exercising its rights over the South China Sea? What other options does the Philippines have on the issue, and how would this affect the implementation of the arbitral award? These are some of the questions that this paper tries to answer. More particularly, this tries to evaluate the Best Alternative To a Negotiated Agreement (BATNA), including WATNA (Worst Alternative To a Negotiated Agreement) of the Philippines arising from the said decision using the Social Impact Assessment Framework for Expanded Stakeholder Analysis.

THE SOUTH CHINA SEA UNCLOS TRIBUNAL AWARD 2016: WHAT IT HAS CHANGED AND WHAT IT DOES MEAN TO INDONESIA

Since The Permanent Court of Arbitration issued its award on 12 July 2016 it have raised many controvertion. Almost all Submissions are decided in favour of the Philippines. The Award, as expected by many scholars, is not intended to solve the core dispute of the South China Sea ‘what maritime features belong to whom', since the very nature of this kind of dispute is not under the Tribunal competence. The sovereignty over disputed features shall be left to the claimant States for the resolution. Nevertheless, the Tribunal Award has not only clarified the dispute but also partially solve the core dispute. The legal clarification is expected to contribute to future negotiations among the claimant States concerning the core (sovereignty) dispute. This Article attempts to identify and describe what has been changed by the Tribunal Rulings and what has been solved. The implication of the Ruling on Indonesia's legal interest is also briefly discuss.

The Victory of Pluralism: The Role of International Law in The South China Sea Dispute

AbstractThis research discussed the role of Permanent Court of Arbitration’s decision on the dynamic of South China Sea dispute. Court’s decision in July 2016 to regulate South China Sea based on UNCLOS’s regulation has provoked China’s objection. This research question is on how to understand the role of international law in the South China Sea dispute using English School Theory. To answer the research question, this research is using English School Theory with its two pillars namely pluralism and solidarism. This research shows two findings. First, the PCA decision has been used by the Philippines to be momentum for transformation from solidarist mode of foreign policy to pluralist mode. Secondly, the pluralism pillar of English School is more relevant in analyzing the role of international law on South China Sea Dispute with the addition of reconceptualization of legitimacy.Key words: English School, international law, Permanent Court of Arbitration, pluralism, solidarism, South China Sea

The South China Sea Arbitration Decision and a Plan for Peaceful Resolution of the Disputes

After the Philippines contested Chinese claims and actions in the South China Sea, a five-man panel of the Permanent Court of Arbitration in 2016 handed down a judgment that is surely the most important set of jurisprudential rulings in the modern history of the international law of the sea. The tribunal's judgment provides convincing interpretations of many UNCLOS articles that are important, not only in the context of the South China Sea, but generally in other maritime areas as well. The tribunal's judgment enhances freedom of navigation in ocean areas and provides guidelines for enforcing international law to protect the marine environment. But the tribunal's judgment is unlikely to have much effect with regard to settlement of the South China Sea disputes. Although China technically is bound by the judgments of the tribunal, China did not participate in the proceeding and will never expressly affirm the rulings' correctness. The paper puts forth a three-point plan to allow China to save face in this controversy. It is hoped that taking these steps the tribunal's important rulings may be accepted for what they are—the basis for a settlement of the South China Sea controversy.

Valuing Women as Counsel in International Adjudication

At the outset, it is helpful to draw a distinction between interstate disputes—those at the ICJ and that are administered by some other institutions—and other forms of international arbitration. The reality is that there are relatively few interstate cases. At the moment, there are perhaps a dozen active cases on the docket of the ICJ. That is a relatively full docket for the ICJ, although it has been at that level for a few years now. The Permanent Court of Arbitration (PCA) in its 2015 Annual Report stated that it was administering eight interstate cases. So a good guess of the maximum number of interstate cases that are currently active is perhaps twenty-five.

National Groups (Permanent Court of Arbitration)

National Groups (Permanent Court of Arbitration)

Can China Expand Without Limits?

Can China Expand Without Limits? Walter C. Clemens Jr. (bio) Edward N. Luttwak, The Rise of China vs. the Logic of Strategy (Cambridge, MA: Harvard University Press, 2012). Minqi Li, China and the 21st Century Crisis (London: Pluto, 2016). Henry A. Kissinger, On China (New York: Penguin, 2011; 2012 with a new afterword). Odd Arne Westad, Restless China: China and the World Since 1750 (New York: Basic Books, 2012). Does insight into world affairs benefit from looking at the evidence through the lens of an underlying assumption about the way things work? Or does it conduce to scholarly hubris? If we seek to make sense of the multitude of often contradictory facts about China, do we not need such a framework? Edward Luttwak’s framework approximates that of structural (neo)realism. For him the logic of strategy governs all state behavior, regardless of time, place, culture, or individual personalities. Luttwak concludes that China cannot continue to grow its economy and its military at a rapid rate. Nor can it behave aggressively without alienating other actors. Sooner or later, other actors will respond to what they see as a threat and unite to contain Chinese expansion. Minqi Li, on the other hand, proceeds from the world-system assumptions of Immanuel Wallerstein and concludes that China’s form of capitalism, like that of global capitalism, has no future and must give way eventually to a nondictatorial form of socialism. Henry A. Kissinger and Odd Arne Westad, unlike Luttwak and Li, do not proceed from any grand theory except an open-ended [End Page 175] realism. Taking a long view, however, Kissinger and Westad expect China gradually to return to its historic role as a great power, but each is attuned to the importance of individuals as well as structures and forces. Luttwak qualifies his thesis by conceding that the logic of strategy is not “self-executing.” Still, he says, strategic logic compels leaders of other countries to counter the aggrandizing actions that have characterized China’s behavior since 2011. For example, leaders of India and Japan have initiated a strategic dialogue. But while Luttwak expected a tough response by the Philippines to Chinese claims to the Nansha Islands (Kalayaan Island Group or Spratlys), Rodrigo Duterte, elected president in 2016, sidled up to Beijing and then insulted President Obama. Duterte opted to bandwagon with China rather than balance against it. He did so even after the Permanent Court of Arbitration in The Hague, responding to arguments entered by a previous Philippine government, ruled against China’s claims in the South China Sea. Except for Vietnam, nearly every case addressed by Luttwak challenges his deterministic thesis. Thus, he details how circumstances and human behaviors bolstered in 2009 and then deflated the pro-Chinese orientation of Ozawa Ichiro’s Democratic Party of Japan (DPJ). The Senkaku Islands incident in 2010 and the tsunami in 2011 reminded the Japanese of their need for US support. In April 2011, the DPJ leadership reaffirmed the centrality of Japan’s alliance with the United States and spoke of a complementary East Asian alliance that included Australia but not China. While Luttwak’s argument tends to overstate its deterministic implications, the author’s deep and wide factual knowledge lead him to rich, paradoxical conclusions. Thus, predicting China’s future is made more difficult because threats to stability “deemed probable are more likely to be successfully anticipated and energetically repressed, so that it is the unexpected, improbable threats that are more dangerous for dictatorships” (pp. 252–253) as in the impact on Tunisia of a single fruit seller’s self-immolation. Indeed, dictatorships are more apt to fall because of their few virtues than their man-made defects, as with the shah’s land reforms that antagonized Iran’s landowning clerics. [End Page 176] Considering Russia’s possible role in containing or joining China, Luttwak allows for free will over determinism. Thus, he argues that Russia’s orientation could be decisive if Moscow joined the United States and other actors in an economic blockade to counter Chinese aggression (for example, toward Taiwan). The Kremlin could join a blockade or align with China. The coup de grace against Luttwak’s theory...

The Duterte Administration's Foreign Policy: Unravelling the Aquino Administration's Balancing Agenda on an Emergent China

From 2010 to 2016, then-President Benigno Aquino balanced China's expansive maritime claim in the South China Sea. President Aquino challenged China by shifting the AFP's focus from domestic security to territorial defence, bolstering closer Philippine–US security relations, acquiring American military equipment, seeking from Washington an explicit security guarantee under the 1951 Mutual Defence Treaty (MDT), and promoting a strategic partnership with Japan. However, the Duterte administration is unravelling its predecessor's balancing agenda by distancing itself from the United States and gravitating closer to China, despite the Permanent Court of Arbitration (PCA) July 12 2016 award to the Philippines. President Duterte's foreign policy is directed at reviving the equi-balancing policy on China, in contrast to then-President Aquino's balancing strategy. This is best exemplified by his efforts to harness China for several major infrastructure and investments projects in the Philippines and to resort to bilateral negotiations with Beijing. The present article argues that instead of relying on the US, President Duterte is fostering closer security partnership with Japan to equi-balance an emergent China.

An Assessment of the Legality of Claims to the South China Sea Dispute

In 2011 the Philippines government lodged a complaint against China with the Permanent Court of Arbitration arguing that China is violating its sovereignty in the South China sea. Whist the Chinese government has dismissed the judgement it has brought into question the legality of the claims to the dispute and also claims by other States in the region such as Malaysia and Brunei. This paper will begin with an analysis of the currently acceptable ways of acquiring territory by member States in international law. A further discussion of the on the individual claims by member States to the dispute will be made. It will conclude by discussing the decision of the Permanent Court of Arbitration and providing a recommendation on how best to address the dispute.

Freshwater Boundaries Revisited

Although boundaries, including freshwater ones, are generally set by treaties concluded by the states concerned, interpretation of such agreements by the different states has varied, resulting in a number of disputes before international tribunals. The aim of this monograph is to describe and analyze the different methods applied in the delimitation of international rivers and lakes and the recent developments in this field. The monograph reassesses these diverse methods of boundary delimitation in view of the latest and abundant jurisprudence of the International Court of Justice and the tribunals under the aegis of the Permanent Court of Arbitration on the subject. The monograph also focuses on the influence of human considerations in the field under study and the legal consequences ensuing therefrom, in addition to drawing some conclusions regarding freshwater boundaries.

Philippines v China: assessing the implications of the South China Sea arbitration

ABSTRACTThe question concerning the legality of China’s nine dash line has been the subject of arbitration proceedings at the Permanent Court of Arbitration (PCA) at The Hague. The case, which was submitted to the PCA by the Philippines for adjudication, raised issues which went beyond the main question concerning the legal status of the dash line as a maritime boundary under United Nations Convention on the Law of the Sea 1982 provisions. These included, inter alia, complaints concerning China’s activities within the area enclosed by the nine dash line, the status of maritime features within the maritime enclosure and alleged environmental damage caused by Chinese dredging and infrastructure-building activities within the contested area. On 12 July 2016 the PCA rendered its judgement on the merits of the case. The main objective of this paper is to critically assess the implications of the PCA’s decision for the region and for the international law of the sea.

The Philippines in 2015: the calm before the political storm

AbstractThe year started auspiciously with the successful visit of Pope Francis in Manila. Unfortunately, the afterglow of the event was overshadowed by the tragic death of 44 members of the Special Action Forces (SAF), 18 members of the Moro Islamic Liberation Front (MILF) and the Bangsamoro Islamic Freedom Fighters (BIFF), and five civilians in a botched operation to capture Indonesian terrorist Marwan in Mamasapano, Mindanao. The major political fallout from the tragedy was the breakdown of the peace negotiations with the MILF. The administration was also beleaguered by accusations of incompetence in connection with the monstrous traffic crisis in Metro Manila, extortion rackets at the airport, and the mismanagement of LRT and MRT railway systems. Nonetheless, it demonstrated decisiveness in pursuing an arbitral case against China at the Permanent Court of Arbitration. Despite overseeing a succession of impressive economic growth, the legacy of the Aquino administration and the victory of its anointed ...

Space – The Final Frontier: Analysing Challenges of Dispute Resolution Relating to Outer Space

The development of outer space law at an international level has arguably stagnated after the Moon Agreement in 1979. With the rise in private space activities from the end of the twentieth century, a robust framework for dispute resolution has become an increasingly vital necessity in the space law regime. Scholars have theorized several schemes for settlement of disputes such as consultative alternative dispute resolution, a tribunal for the settlement of space law disputes, a multi-door courthouse and so on, but very few concepts have transformed into operable mechanisms. In space law at the international level, diplomatic consultation, claims commission under the Liability Convention, the International Court of Justice and, in support of arbitration, the rules of the Permanent Court of Arbitration for the Settlement of Disputes relating to Outer Space 2012 remain the only existing viable mechanisms. The article evaluates all these forums for dispute settlement to demonstrate their inadequacies. Thereafter, having identified its long-term limitations, the article seeks to justify a multi-tiered arbitration clause as an effective means of settlement of disputes relating to outer space.

OAO Neftyanaya Kompaniya Yukos v. Russia (Eur. Ct. H.R.)

On July 31, 2014, the European Court of Human Rights (ECtHR) rendered its final decision on a claim brought by the liquidated Russian company OAO Neftyanaya Kompaniya Yukos (Yukos) against the Russian Federation (Russia), a decision that is the last in a series of three decisions in this case relating respectively to the admissibility of the application, the merits, and just satisfaction.A couple weeks prior to the ECtHR’s decision, three arbitral tribunals established under the auspices of the Permanent Court of Arbitration (PCA) and functioning under the UNCITRAL Arbitration Rules had issued their final awards based on claims brought by three former shareholders of Yukos under the Energy Charter Treaty. The dispute, while brought by the shareholders of Yukos, in essence is the same as the one brought by Yukos against Russia before the European Court of Human Rights.

The Enrica Lexie case at the permanent court of arbitration: an analysis

This note examines the recent orders for provisional measures delivered by, both, the ITLOS and the PCA Arbitral Tribunal under Article 290 of the UNCLOS in the Enrica Lexie case (Italy v India). Our study reveals that the notion of Article 290—that the interests of both parties must be assured—has been complied with by the innovative order of the PCA tribunal. Further, the analysis of the legal regime and practices dealing with criminal jurisdiction under the UNCLOS supports the argument that India might find it difficult to sustain its jurisdictional claim over the case. On the issue of jurisdiction of persons in the UNCLOS vis-a-vis domestic legislations, the note argues that clarifications and contributions are needed.

The Vienna Convention and Legally Binding Treaties: Implications for the Maritime Boundary Negotiations between Australia and Timor-Leste

I have been charged by the organisers of this seminar with discussing treaty law and its implications for the possible resumption of maritime boundary negotiations between Australia and Timor-Leste before 2057. Perhaps this is the most contentious mandate of today because it involves arguments about changing the status quo. My paper will unfold in two parts. I will first provide a necessary introduction and context in order to understand the arguments about the revival of the maritime boundary negotiations between Australia and Timor-Leste through a failure of the Treaty on Certain Maritime Arrangements in the Timor Sea (which I will call CMATS). I will then turn to the Arbitration under the Timor Sea Treaty, commenced by Timor-Leste against Australia in 2013, and which is currently pending before the Permanent Court of Arbitration in the Hague. The Arbitration apparently disputes Australia’s exclusive right to tax the pipeline to Darwin from the Bayu Undan gas field in the Joint Petroleum Development Area under Article 8(b) of the Treaty. Based on information that is publicly available (because the Arbitration remains a closed, secret proceeding), I will review the arguments, pro and con, under the law of treaties that might be run to allow Timor-Leste to escape CMATS before 2057 and revive Australia’s obligation to negotiate the boundary dispute in good faith with East Timor. These arguments relate to whether the circumstances surrounding the conclusion of CMATS renders CMATS invalid or otherwise void at international law.

Les procédures d’arbitrage dans les accords d’investissement de l’Union européenne. L’enjeu des traités transatlantiques

Forte de la compétence exclusive en matière d’investissement international que lui avait confiée le Traité de Lisbonne, l’Union européenne s’est engouffrée dans la négociation de traités bilatéraux d’investissement dans diverses régions du monde. Selon la Commission, ces traités comporteront un dispositif ambitieux, combinant libéralisation du commerce dans les secteurs primaires, secondaires et tertiaires, convergence réglementaire et protection de l’investissement. Ces nouveaux traités devraient également servir de modèles pour remplacer les nombreux traités bilatéraux d’investissement conclus jusqu’à présent par les pays membres de l’Union. Parmi ces initiatives, les négociations transatlantiques (Canada, États-Unis) représentent l’enjeu le plus important, tant par leur ambition que par le volume des transactions concernées. Lancées en l’absence totale de transparence, ces négociations ont suscité de fortes préoccupations dans les milieux politiques et au sein de la société civile, la création envisagée d’un système d’arbitrage ad hoc investisseurs-États étant la pierre d’achoppement. Devant cette levée de boucliers contre la privatisation de la justice, la Commission cherche désormais à corriger le tir, en proposant une Cour arbitrale permanente dotée d’une instance d’appel. Sur la base de la jurisprudence de la Cour de justice européenne, sont examinés les problèmes que soulèverait une juridiction conférant un accès exclusif, accessible aux seuls investisseurs étrangers, pour des litiges susceptibles de porter sur l’interprétation de la règle nationale et communautaire. Un tel système, qu’il soit ad hoc ou permanent, est-il nécessaire entre des États qui jouissent de systèmes juridiques hautement développés et d’un pouvoir judiciaire indépendant ? Serait-il conforme au principe de l’égalité des citoyens devant la justice ? Porterait-il atteinte à la primauté du droit européen, valeur communautaire essentielle ?