Resolving Investment Disputes Research Articles

The Rule of Law and Alternatives to Investment Arbitration

This article is the text of a talk the author gave at the EFILA Annual Conference 2016. This article considers national courts and domestic alternative dispute resolution as alternative means of resolving investment disputes and in this regard, examines whether the resolution of investment disputes by such means promotes or holds back the development of the rule of law.

Instituting Investment Claims Under the Trans-Pacific Partnership Agreement

This chapter examines that draft Investment Chapter and analyses provisions bearing on the resolution of investor-state disputes arising under the Trans-Pacific Partnership Agreement (TPPA). It also briefly examines the significance of Australia's insistence on an exemption from investor-state arbitration (ISA), and what this means in terms of the institutional differences between ISA and the use of domestic courts to resolve investment disputes. The draft version of the Investment Chapter of the TPPA leaked to the public in June 2012, while undoubtedly authentic, is unlikely to constitute the final version of the investment chapter. This is especially so in light of the need for public consultation and the need to secure agreement from some states that are apparently pushing for amendments to the Chapter. Given the political nature of TPP negotiations, it is difficult to predict the precise form of ISA provisions that the TPP negotiators will finally adopt. Keywords: Australia; draft Investment Chapter; investor-state arbitration (ISA); Trans-Pacific Partnership Agreement (TPPA)

The Governance of Foreign Investment at a Crossroad: Is an Overlapping Consensus the Way Forward?

AbstractThis article makes the claim that the present efforts to reform the international investment regime (IIR) will not save this field from the existing criticisms. Given the plural values at issue, it is unlikely that states – let alone local populations – will ever reach a consensus on the substantive questions surrounding foreign investment. Historically, the main characteristic of foreign investment governance has been the lack of multilateral consensus. This field remained dominated by diplomacy and customary international law until bilateral treaties and investment arbitration became the leading mechanism to resolve investment disputes in the 1990s. This highly legalized regime, however, has been subject to criticisms from developing and increasingly from developed countries. Most reform proposals fail to go beyond alternatives that have been unsuccessful in the past, such as a multilateral investment agreement (MIA) or state-to-state arbitration. This article takes a different approach to foreign investment governance, starting from its political economy. It claims that the IIR does not depoliticize foreign investment relations but rather promotes the politics of foreign investors’ property rights protection. Relying on property theory and pluralism as heuristic tools, this article analyses the resistance to investment arbitration, the obstacles to multilateral cooperation, and the possibility of an overlapping consensus on the institutions for foreign investment governance.

Investor-State Arbitration: Evaluating Australia’s Evolving Position

This article examines Australia’s contentious 2011 Trade Policy Statement in which the Federal Government indicated that it will no longer provide for investor-state arbitration (ISA) in future bilateral and regional trade agreements (BRTAs), choosing instead to rely on alternatives to ISA. These are likely to vary from encouraging investor-state parties to negotiate contracts that provide mechanisms for dispute resolution to providing by treaty that domestic courts resolve such disputes. Notwithstanding a change in Australia’s Federal Government in 2013, two years after the Policy Statement was announced, the new Liberal Government has retreated from that Policy notably by including ISA in the Korea-Australia Free Trade Agreement (KAFTA) concluded on 5 December 2013. However, it has not rejected the Policy, but has indicated instead that it will consider ISA in its treaties on a case-by-case basis. As a result, the Policy could still have significant ramifications for Australia in negotiating BRTAs; it could have a material impact on Australia’s inbound and outbound investors, as well as upon other states and investors directly or indirectly impacted by Australia’s Policy. It is also conceivable that other states will follow Australia’s initiative and reconsider whether to agree to ISA in their BRTAs. In analysing the policy shift against ISA, the paper evaluates the nature of foreign direct investment (FDI) and its economic and legal significance to host and home states, as well as to inbound and outbound foreign investors. Following this analysis, the paper outlines the rationale behind Australia’s rejection of ISA in 2011. It evaluates the perceived advantages and disadvantages of alternatives to ISA, such as diplomatic intervention in investor-state disputes and conciliation proceedings between investor-state parties. However, it focuses on the most likely alternative to ISA, namely, reliance on domestic courts to resolve investment disputes. The paper argues against the complete rejection of ISA. It illustrates the challenges of Australia relying on domestic courts to resolve investor-state disputes in light of the impending Investment Chapter of the Trans-Pacific Partnership Agreement (TPPA) and the preservation of Australia’s investment interests in Asia. As an alternative, the article proposes the adoption of a BIT policy which would provide investor-state parties with a choice among dispute-avoiding measures, including access to either domestic courts or ISA. The rationale is that such an approach is likely to preserve the national interests of Australia, while also gaining support within the international community of states and among foreign investors.

The Status of Investor - State Arbitration: Resolving Investment Disputes under the Transpacific Partnership Agreement

Intense debate is currently brewing over the multistate negotiation of the Transpacific Partnership Agreement (TPPA). The TPPA is likely to be the second largest trade and investment agreement after the European Union, with trillions of investment dollars at stake. However, there is significant controversy and uncertainty over the resolution of investor-state disputes under it. This manuscript evaluates these issues. It concludes with the proposition that states that forsake investor-state arbitrator in favour of domestic courts, among other options, do so at their peril.

The Rules of Procedure for Conciliation Proceedings in International Investment Law

This article examines conciliation as an alternative dispute resolution mechanism in resolving investment dispute. Conciliation being a highly flexible and an informal method of dispute settlement involves a third party that assists the disputants in reaching an agreed settlement. The Convention on the Settlement of Investment Dispute between States and Nationals of other States establishes a Centre known as the International Centre for Settlement of Investment Disputes (ICSID) which facilitates arbitration and conciliation proceedings for resolving investment disputes. This article reveals that irrespective of the fact that arbitration is largely patronized in the Centre, conciliation has being regarded as a highly flexible and less expensive process for resolving investment disputes. This article examines the rules of procedure for conciliation proceedings specifically under the ICSID Convention for resolving investment disputes.

International Law and the Settlement of Investment Disputes Relating To China

This article examines how international investment law can be used to resolve investment disputes in China. After a general overview over the basic structure of international investment law, it explores the international legal rules applicable to foreign investors in China and Chinese investors in third countries. It focuses on China’s obligations under the Convention on the Settlement of Investment Disputes between States and Nationals of other States; the Convention establishing the Multilateral Investment Guarantee Agency, the WTO/GATT-regime and bilateral investment treaties. It thereby illustrates China’s cautious approach to international arbitration and other international standards relating to the protection of foreign investors and the current trend in Chinese politics to turn to international law to protect its investors in third countries. The article concludes that—also caused by increasing Chinese outward investment—the international investment regime relating to China has left its infant stage and provides remedies for foreign investors in China and Chinese investors abroad.