32 results
19 - Applicable Law in International Investment Arbitration
- from Part IV - Applicable Law
- Edited by Stefan Kröll, Andrea K. Bjorklund, McGill University, Montréal, Franco Ferrari, New York University
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- Cambridge Compendium of International Commercial and Investment Arbitration
- Published online:
- 18 February 2023
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- 02 March 2023, pp 512-536
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Despite the critical importance of applicable law in international arbitration, the concept remains misunderstood and often ignored. In the field of international investment law, whether the arbitration proceedings arise from an investment treaty or from a contract, the cornerstone principle of party autonomy applies when it comes to the choice of applicable law, as provided, for example, in article 42 of the ICSID Convention. Even that principle, however, is subject to debate, for example with respect to whether initiating arbitration proceedings under an investment treaty amounts to an implicit choice of applicable law. In an attempt to clarify the notion of applicable law, this contribution first distinguishes the rules of decision, i.e. the law applicable to the specific claims submitted by an investor against a state, from incidentally applicable law, i.e. the other laws which may be relevant for the resolution of the dispute but that do not form a basis for the decision on the merits. In a second part, this contribution analyses several questions arising from the application of choice-of-law provisions in practice, with an emphasis on article 42 of the ICSID Convention. Finally, the consequences of erring in the application of the correct applicable law are examined.
52 - Post-Award Access to Justice Issues: Using Investment Treaties to Enforce Commercial Arbitration Awards
- from Part X - Post-Award Issues
- Edited by Stefan Kröll, Andrea K. Bjorklund, McGill University, Montréal, Franco Ferrari, New York University
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- Book:
- Cambridge Compendium of International Commercial and Investment Arbitration
- Published online:
- 18 February 2023
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- 02 March 2023, pp 1609-1630
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Commercial parties engaged in international transactions will typically resist agreeing to submit disputes to their counterparty’s national court system due to the real or perceived ‘home court advantage’. While international arbitration solves the problem with respect to the dispute on the merits, the arbitrators’ authority ends with the rendering of their award, and they cannot compel compliance with the award if voluntary compliance is not forthcoming. For that, the prevailing party – now an award creditor – must turn to the national courts, where the ‘home court advantage’ can re-emerge:the place of arbitration may have been located in the award debtor’s state, giving its courts the power to annul the award; or the award debtor’s assets may be uniquely located in its home state, making that the only practical enforcement forum. And problems may be particularly acute where the award debtor is the State itself or a state-controlled entity.The present chapter considers a potential option for an award creditor whose commercial arbitration award is annulled on arbitrary or parochial grounds by the courts of the seat, or wrongfully denied enforcement in that or another jurisdiction: the use of investment arbitration to enforce commercial arbitration awards as a vindication of rights and remedies under international law.
Kardassopoulos and Fuchs v. Republic of Georgia
- ICSID (Arbitration Tribunal). 6 July 2007 3 March 2010 21 March 2011
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- Journal:
- ICSID Reports / Volume 20 / 2022
- Published online by Cambridge University Press:
- 06 July 2022, pp. 141-163
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- 2022
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Jurisdiction – Investment – ICSID Convention, Article 25(1) – Salini test – Whether economic activities in connection with a joint venture constituted an investment
Jurisdiction – Investment – Evidence – Whether there was sufficient documentary evidence that an investor had an interest in a protected investment
Jurisdiction – Investment – Legality – Contract – Municipal law – Whether the concession and agreement through which the investment was made were void ab initio under municipal law – Whether the investment was entitled to protection under the BIT and the ECT even if the concession and agreement were void ab initio under municipal law
Admissibility – Estoppel – Legality – Contract – Municipal law – Whether the State was estopped from objecting to the tribunal’s jurisdiction ratione materiae under the BIT and the ECT on the basis that the concession and agreement could be void ab initio under municipal law
Jurisdiction – Investment – Legality – Legitimate expectation – Governmental authority – Whether the State created a legitimate expectation that the investment was made in accordance with municipal law and would be entitled to treaty protection – Whether agreements were cloaked with the mantle of governmental authority
Jurisdiction – Investment – Legality – Legitimate expectation – Attribution – State-owned entity – Whether representations by State-owned enterprises could be attributed to the State – Whether ultra vires conduct by State-owned enterprises could be attributed to the State – Whether attribution was contingent on the timing of the State’s adherence to the BIT or the ECT
Jurisdiction – Investment – Provisional application – Interpretation – ECT, Article 1(6) – Meaning of “Effective Date” – Whether provisional application of the ECT was equivalent to its entry into force – Whether the ECT was provisionally applicable on the date of the Contracting Parties’ signature of the ECT
Procedure – Burden of proof – Whether the investors were subject to a special or heavy burden of proof in establishing their claims
Admissibility – Equitable prescription – Whether the claims should be time-barred due to the 10-year delay in filing the claims
State responsibility – Attribution – State-owned entity – ILC Articles on State Responsibility, Article 4 – ILC Articles on State Responsibility, Article 5 – ILC Articles on State Responsibility, Article 11 – Structural test – Functional test – Contract – Governmental authority – Whether the contractual commitments, acts and omissions of State-owned entities could be attributed to the State – Whether State-owned entities exercised or purported to exercise governmental authority
Contract – Defence – Municipal law – Scope of rights – Unconscionability – Misrepresentation – Whether the concession and agreement through which the investment was made conferred rights to future pipelines – Whether the investors’ rights were vitiated by virtue of contractual defences raised by the State – Whether the contractual defences of unconscionability, misrepresentation and lack of performance were supported by the evidence
Expropriation – Direct expropriation – Whether the State expropriated the investor’s investment through a governmental decree that deprived its joint venture vehicle of rights in an oil pipeline
Expropriation – Unlawful expropriation – ECT, Article 13(1) – Public interest – Discrimination – Due process – Compensation – Whether the expropriation was in the public interest – Whether the expropriation was carried out in a discriminatory manner – Whether the expropriation was carried out in accordance with due process – Whether the investor was paid prompt, adequate and effective compensation
Fair and equitable treatment – Legitimate expectation – Transparency – Discrimination – Whether the standard required the investor’s expectations to be based on conditions offered by or prevailing in the State at the time the investment was made – Whether the State’s compensation process violated basic requirements of consistency, transparency, even-handedness and non-discrimination
Remedies – Compensation – Quantum – Contract – Stabilisation clause – Whether contractual stabilisation clauses limited damages for expropriation – Whether it was appropriate to compensate for the increase in the value of expropriated rights between the date of the expropriation and the date of the award
Remedies – Compensation – Fair and equitable treatment – ILC Articles on State Responsibility, Article 36 – Valuation methodology – What was the standard of compensation applicable to a breach of the fair and equitable treatment standard
Costs – Third-party funding – Whether third-party funding should be taken into account in the award of costs
Annulment – Procedure – Whether annulment proceedings should be suspended pending resolution of the application for revision of an award
Tulip Real Estate Investment and Development Netherlands BV v. Republic of Turkey
- ICSID (Arbitration Tribunal). 10 March 2014 7 March 2014 30 December 2015
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- Journal:
- ICSID Reports / Volume 20 / 2022
- Published online by Cambridge University Press:
- 06 July 2022, pp. 220-266
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- 2022
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Jurisdiction – Investment – ICSID Convention, Article 25 – Whether an investment can be composed of interrelated transactions
Admissibility – Representative claims – Whether claims may be asserted on behalf of a non-party to the proceeding
State responsibility – Attribution – ILC Articles on State Responsibility, Article 4 – State organ – Whether a State-owned real estate developer was an organ of the State – Whether a majority shareholding by the State triggered a presumption that the entity was an emanation of the State
State responsibility – Attribution – ILC Articles on State Responsibility, Article 5 – Governmental authority – Contract – Whether a State-owned real estate developer was empowered by municipal law to exercise governmental authority – Whether an entity’s affiliation with a State organ and the enjoyment of preferential rights under municipal law implied an exercise of public authority – Whether the entity exercised puissance publique in its contractual negotiation, performance or termination
State responsibility – Attribution – ILC Articles on State Responsibility, Article 8 – Effective control – Contract – Whether shared management of a real estate developer by State organs and parastatal entities could be relevant for attribution – Whether the commercial soundness of a decision was relevant to attribution – Whether contractual termination was an expression of sovereign power
Jurisdiction – Contract – Whether claims arising out of a contractual termination may constitute treaty claims
Fair and equitable treatment – Interpretation – Legitimate expectation – Legal stability – Contract – Whether standard required proactive protection of legal stability and predictability – Whether any precontractual representations provided the basis for legitimate expectations regarding zoning – Whether the decisions of a State-owned real estate developer not to grant further extensions and ultimately to terminate a contract were a breach of fair and equitable treatment
Expropriation – Contract – Whether a recommendation by a State organ entity to terminate a contract meant that the termination was an improper exercise of sovereign power
Full protection and security – Interpretation – Contract – Police – Whether the standard of full protection and security imposed an obligation of strict liability – Whether the involvement of police forces in the termination of a contract implied a breach of full protection and security
Umbrella clause – Domestic legislation – Whether a claim under the domestic investment legislation of the host State could be elevated to a breach of international law
Investment promotion – Interpretation – Whether a failure to promote and protect investments constituted a discrete breach of the BIT
Costs – Costs follow the event – Whether the unsuccessful party should bear the arbitration costs
Annulment – Serious departure from a fundamental rule of procedure – ICSID Convention, Article 52(1)(d) – Interpretation – Right to a fair trial – VCLT, Article 31(3)(c) – Human rights – Whether human rights instruments were relevant to the interpretation of the concept of a fundamental rule of procedure
Annulment – Serious departure from a fundamental rule of procedure – ICSID Convention, Article 52(1)(d) – Attribution – Evidence – Whether a tribunal disregarded critical evidence relevant to attribution
Annulment – Manifest excess of powers – ICSID Convention, Article 52(1)(b) – Jurisdiction – Attribution – Whether a tribunal’s determination on the merits despite lack of jurisdiction for want of attribution was a manifest excess of powers
Annulment – Failure to state reasons – ICSID Convention, Article 52(1)(e) – Attribution – ILC Articles on State Responsibility, Article 8 – Whether a tribunal failed to state reasons for concluding that a State-owned real estate developer was acting under the instruction or control of the State
Saint-Gobain Performance Plastics Europe v. Bolivarian Republic of Venezuela
- ICSID (Arbitration Tribunal). 3 November 2017 27 February 2013 30 December 2016 21 December 2016 24 October 2018
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- Journal:
- ICSID Reports / Volume 20 / 2022
- Published online by Cambridge University Press:
- 06 July 2022, pp. 360-405
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- 2022
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Procedure – Challenge to arbitrator – ICSID Convention, Article 57 – ICSID Convention, Article 14 – Independence – Impartiality – Issue conflict – Whether previous administrative or political appointments in government led to manifest lack of qualifications to exercise independent judgment – Whether an arbitrator’s previous advocacy on behalf of a State created the risk of an issue conflict
Admissibility – Attribution – Contract – Whether alleged breaches of a contract entered into by an investor’s subsidiary and a State-owned entity were attributable to the State – Whether the alleged breaches of contract should be determined on the merits of the alleged breach of the standard of fair and equitable treatment
Admissibility – Procedure – Incidental or additional claim – Whether a claim was untimely if raised for the first time in the hearing on jurisdiction and merits – Whether there was sufficient opportunity for both parties to respond to the claim
Expropriation – Interpretation – Measures – Particular undertaking – Whether the term “measures” required an expropriation to consist of a formal exercise of government powers – Whether notion of a particular undertaking included other provisions of a BIT or was limited to external agreements entered into by the State
Expropriation – Prompt compensation – Interpretation – Good faith – VCLT, Article 31(1) – Manifestly absurd or unreasonable – VCLT, Article 32(b) – Municipal law – Whether the payment of prompt compensation required the State to specify a certain figure constituting the amount of compensation on the date of expropriation – Whether that interpretation contravened the principle of good faith interpretation – Whether that interpretation led to a manifestly absurd or unreasonable result – Whether a tribunal had to examine whether municipal law implemented an expropriation procedure in accordance with the BIT
Expropriation – De facto expropriation – Whether acquiring de facto control of an investment with the aim of ultimately carrying out an expropriation could amount to an expropriation
Expropriation – Attribution – Non-State actors – ILC Articles on State Responsibility, Article 8 – ILC Articles on State Responsibility, Article 11 – Whether the physical takeover of a plant by former workers, union officials and sympathetic politicians was under the instructions of, or under the direction or control of, the State – Whether causality between a presidential announcement and the physical takeover was sufficient to attribute the conduct of non-State actors – Whether the subsequent adoption of the conduct of non-State actors by a State-owned entity vested with governmental authority was attributable to the State
Expropriation – Attribution – State-owned entity – ILC Articles on State Responsibility, Article 5 – Whether the presence of a State-owned entity in the investor’s abandoned plant was merely in a caretaker capacity for reasons of public safety – Whether the State-owned entity was vested with governmental authority to nationalise the plant
Procedure – Judicial economy – Remedies – Whether a tribunal had to make a finding on an alleged breach of the standard of fair and equitable treatment when it would not have altered the amount of compensation to which the investor was entitled
Fair and equitable treatment – Legitimate expectation – Legal stability – Contract – Attribution – State-owned entity – Whether a legitimate expectation of the contractual performance of a State-owned entity at a certain price can be formed in the absence of a specific commitment from the State guaranteeing such performance or price – Whether any breach of contract had been established – Whether it was necessary to address the issue of attribution in the absence of contractual breach
Full protection and security – Legal stability – Contract – State-owned entity – Whether the State had an obligation to protect an investor from alleged contractual breaches by a State-owned entity
Remedies – Compensation – Expropriation – Quantum – Fair market value – Discounted cash flow – Country risk premium – Evidence – Whether a finding of unlawfulness was relevant to the standard of compensation for expropriation – Whether the value of the investment was higher on the date of expropriation or the date of award – Whether fair market value could be determined using the method of discounted cash flow – Whether the discount rate applied to future cash flows should include the risk of expropriation as part of the country risk premium – Whether the evidence presented by the parties’ experts determined the correct variables of future cash flows – Whether a reduction in future profits should be made to account for the investment’s dependence on the investor’s marketing and distribution networks – Whether the investor was entitled to compensation for historical losses arising from increases in the price of inputs
Remedies – Compensation – Interest – Compound interest – Whether interest should be calculated on a simple basis because compound interest was prohibited under municipal law – Whether compound interest would ensure full reparation under international law for the time value of the investor’s losses
Annulment – Procedure – Seat – ICSID Convention, Article 62 – Whether annulment proceedings may be conducted in a place different from the seat of ICSID absent agreement of parties
Annulment – Procedure – Stay of enforcement – Whether a stay of enforcement of the award should be lifted because the applicant for annulment failed to pay an advance on costs
Annulment – Procedure – Suspension of proceedings – Whether annulment proceedings should be suspended because the applicant for annulment failed to pay an advance on costs
Mesa Power Group, LLC v. Government of Canada
- Permanent Court of Arbitration. 24 March 2016 15 June 2017
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- Journal:
- ICSID Reports / Volume 20 / 2022
- Published online by Cambridge University Press:
- 06 July 2022, pp. 267-293
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- 2022
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Jurisdiction – Foreign investor – Investment – NAFTA, Article 1116 – Whether a foreign investor met the jurisdiction requirements set forth in NAFTA – Whether claims based on a causal link between the challenged measures and the investment were sufficient for a tribunal to have jurisdiction under NAFTA Article 1116
Jurisdiction – Consultation – NAFTA, Article 1118 – Whether a foreign investor could comply with NAFTA Article 1118’s consultation requirement without substantively engaging with the State – Whether the fact that a foreign investor sought consultations with a State was sufficient to meet NAFTA Article 1118’s consultation requirement
Jurisdiction – Cooling-off period – NAFTA, Article 1120 – Whether an investor was required to observe NAFTA Article 1120’s cooling-off period – Whether every event that gave rise to a claim must have occurred before the cooling-off period – Whether the investor must have suffered damage prior to the cooling-off period
Jurisdiction – Investment – Timing – NAFTA, Article 1101 – NAFTA, Article 1116 –– Whether a tribunal had jurisdiction over claims based on investments made after the relevant measure was implemented by the State – Whether the date of an investment’s incorporation was sufficient to determine when an investment was made
State responsibility – Attribution – State enterprise – NAFTA, Article 1503(2) – Interpretation – Whether an entity established by a State should be considered an organ of the State – Whether actions by a State enterprise could be attributed to a State
Most-favoured-nation treatment – National treatment – Interpretation – NAFTA, Article 1108 – Procurement – Whether a procurement process was exempt from a State’s most-favoured-nation treatment and national treatment obligations – Whether the procurement of energy constituted a procurement process
Minimum standard of treatment – NAFTA, Article 1105 – Interpretation – Policy – Transparency – Whether a State must afford investors the minimum standard of treatment pursuant to customary international law – Whether tribunals should examine the State’s underlying policy decision when examining a State’s compliance with the minimum standard of treatment – Whether transparency was part of the minimum standard of treatment
Costs – Legal costs – Whether a party should be held responsible for its opponent’s legal costs when their good faith claims were dismissed by the tribunal
Annulment – Applicable law – Whether a court considering the vacatur or confirmation of an award should apply the law of its jurisdiction or the law of the seat of the arbitration
Annulment – Municipal law – Misconduct affecting parties’ rights – Exceeded arbitral power – Manifest disregard of the law – Interpretation – Deference – Whether a tribunal’s allegedly erroneous factual findings or legal conclusions serve as grounds for vacating its award – Whether an award should be vacated on the ground that the tribunal misinterpreted the meaning of procurement – Whether an award should be vacated on the ground that the tribunal deferred to the State’s decision-making in its renewable energy policy
Appeal Relating to the Jurisdiction of the ICAO Council
- Part of
- Cecily Rose
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- Journal:
- American Journal of International Law / Volume 115 / Issue 2 / April 2021
- Published online by Cambridge University Press:
- 19 April 2021, pp. 301-308
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- April 2021
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In two nearly identical judgments dated July 14, 2020, the International Court of Justice (ICJ or Court) reviewed a decision taken by the Council of the International Civil Aviation Organization (ICAO) in a dispute about aviation restrictions imposed on Qatar by Bahrain, Egypt, Saudi Arabia, and the United Arab Emirates (UAE). These cases represent the second time that the Court has heard an appeal concerning a decision of the ICAO Council, a treaty body which has executive, administrative, and dispute settlement functions. As in 1972, when the Court heard an appeal brought by India against Pakistan, the Court's 2020 judgments concern a Council decision on preliminary objections to jurisdiction and admissibility. These judgments not only reinforce the ICJ's findings in its 1972 judgment, which raised similar procedural issues, but they also highlight the scope and the limits of the Court's rare appellate function.
Malaysian Historical Salvors Sdn, Bhd v. Government of Malaysia
- ICSID (Arbitration Tribunal). 19 February 2009 16 April 2009 17 May 2007
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- ICSID Reports / Volume 19 / 2021
- Published online by Cambridge University Press:
- 22 November 2021, pp. 110-167
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- 2021
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Jurisdiction — Investment — ICSID Convention, Article 25 — Interpretation — Whether there was an independent obligation to show that an investment satisfied the definition under Article 25 of the ICSID Convention in addition to the definition provided by the BIT
Jurisdiction — Investment — ICSID Convention, Article 25 — Interpretation — Salini test — Whether the Salini test provided mandatory legal requirements or should be considered holistically
Jurisdiction — Investment — ICSID Convention, Article 25 — Interpretation — Whether there was a requirement of regularity of profit and return
Jurisdiction — Investment — Economic development — ICSID Convention, Article 25 — Whether there was regularity of profit and return — Whether the investor made contributions – Whether the contributions took place over a duration of time — Whether the investor accepted risk — Whether the investor made a significant contribution to the host State’s economic development
Annulment — Manifest excess of powers — ICSID Convention, Article 52(1) — Jurisdiction — Interpretation — ICSID Convention, Article 25 — VCLT, Article 31 — VCLT, Article 32 — Salini test — Travaux préparatoires — Whether the preparatory works demonstrated that the drafters of the ICSID Convention left the meaning of investment for later agreement of the contracting parties — Whether elements of the Salini test were mandatory requirements of an ICSID investment — Whether a tribunal’s failure to consider the definition of investment under a BIT and thus failure to exercise jurisdiction was in manifest excess of its powers
Interpretation — Travaux préparatoires — VCLT, Article 31 — VCLT, Article 32 — Whether a term must be regarded as ambiguous or obscure before a tribunal may resort to preparatory works
Annulment — Costs — Small claims — Whether an annulment committee should depart from the usual practice of sharing equally the costs of an annulment proceeding so as not to deter small claims under the ICSID Convention
Poštová banka, a.s. and Istrokapital SE v. Hellenic Republic
- ICSID (Arbitration Tribunal). 29 September 2016 9 April 2015
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- Journal:
- ICSID Reports / Volume 19 / 2021
- Published online by Cambridge University Press:
- 22 November 2021, pp. 690-727
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- 2021
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Jurisdiction — Investment — Minority or indirect shareholding — Parent company — Whether the parent company had any right to the assets of the subsidiary that qualified for protection — Whether the parent company had standing to directly pursue claims to the assets of the subsidiary
Jurisdiction — Investment — Sovereign bonds — Interpretation — VCLT, Article 31 — Claims to money — Whether literal analysis of assets listed under the definition of investment in the BIT was sufficient to determine the scope of protected investments — Whether a category of assets may be excluded as an investment by a contextual interpretation of the BIT in light of its object and purposes — Whether the specific examples used in the BIT played a role in determining the scope of protected investments — Whether the listed investments included sovereign bonds — Whether references to corporate bonds and claims to money in the BIT covered sovereign bonds
Jurisdiction — Investment — Sovereign bonds — ICSID Convention, Article 25 — Duration — Contribution — Risk — Whether interests in sovereign bonds satisfied an objective approach to investment — Whether holding bonds satisfied the requirement of sufficient duration — Whether holding bonds involved a contribution or mere exchange of value — Whether holding bonds involved an operational risk
Annulment — Failure to state reasons — ICSID Convention, Article 52(1) — Whether the award included reasons to enable the reader to understand how the tribunal got from one point to another — Whether the reasons were contradictory — Whether errors in reasoning determined the outcome
Caratube International Oil Company LLP v. Republic of Kazakhstan
- ICSID (Arbitration Tribunal). 21 February 2014 5 June 2012
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- Journal:
- ICSID Reports / Volume 19 / 2021
- Published online by Cambridge University Press:
- 22 November 2021, pp. 424-445
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- 2021
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Jurisdiction — Foreign investor — ICSID Convention, Article 25(2)(b) — Foreign nationality — Ownership or control — Investment — Economic contribution — Whether the scope of protection under the BIT for companies under foreign control fell within the outer limit of ICSID jurisdiction — Whether the national of another contracting State had made an investment — Whether establishing foreign ownership under the BIT was sufficient in light of the requirement for foreign control in the ICSID Convention
Jurisdiction — Investment — Interpretation — “Every kind of investment” — Economic contribution — Origin of capital — Whether the definition of investment required an economic contribution by a foreign national — Whether origin of capital was relevant to the existence of an investment
Jurisdiction — Investment — Interpretation — ICSID Convention, Article 25(1) — Whether the inherent meaning of investment under ICSID jurisprudence was relevant in determining ownership or control by a foreign national — Whether there was an economic arrangement requiring a contribution to make a profit and some degree of risk
Jurisdiction — Investment — Foreign nationality — Ownership or control — Evidence — Burden of proof — Adverse inferences — Whether the burden of proof can shift from the claimant to the State due to seizure of document — Whether adverse inferences may be drawn from the failure to produce documents
Annulment — Failure to state reasons — Manifest excess of powers — Serious departure from a fundamental rule of procedure — ICSID Convention, Article 52(1) — Foreign nationality — Applicable law — Obiter dictum — Translation — Whether a tribunal’s misapplication of or failure to apply the applicable law justified annulment if its interpretation was reasonable or tenable — Whether reliance on an incorrect translation warranted annulment if the reasoning was incidental to the operative part of the award — Whether obiter dictum issued without hearing warranted annulment
Mitchell v. Democratic Republic of the Congo
- ICSID (Arbitration Tribunal). 1 November 2006 30 November 2004 23 January 2004 9 February 2004
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- Journal:
- ICSID Reports / Volume 19 / 2021
- Published online by Cambridge University Press:
- 22 November 2021, pp. 85-109
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- 2021
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Jurisdiction — Investment — Professional services — ICSID Convention, Article 25(1) — Whether legal services qualified as an investment — Whether a contribution to the economic development of the host State was required for there to be an investment
Expropriation — Measures tantamount to expropriation — Whether international law or national law was applied to determine whether an expropriation had occurred under the BIT — Whether measures resulting in the total loss of clients may constitute measures tantamount to expropriation
Remedies — Damages — Expropriation — Fair market value — Capitalised earnings approach — Whether the investor was entitled to compensation based on a projection into the future of income from the previous years — Whether the investor was entitled to compensation including projected income on accounts held outside the host State — Whether the capitalisation rate was appropriate to the economic and political circumstances of the host State — Whether the period of future compensation reflected the claimant’s inability to return to the host State
Counterclaim — Nuisance — Reputational damage — Whether the host State was entitled to reputational damages resulting from an investment treaty claim
Annulment — Stay of enforcement — ICSID Convention, Article 52(5) — Whether potential difficulties for the State in recouping the amount of the Award in case of annulment were likely — Whether other State budgetary priorities are a relevant factor in deciding whether to grant a stay — Whether the lack of urgency of recovery of the award by an investor was a relevant factor in deciding whether to grant a stay — Whether the seriousness of the grounds invoked in the annulment proceedings is a relevant factor in deciding whether to grant a stay
Annulment — Stay of enforcement — ICSID Convention, Article 52(5) — Whether the posting of a bank guarantee in the amount of the award was a condition for a stay of enforcement — Whether the principle that the State was obliged to comply with its international obligations is a sufficient basis for deciding whether to require the posting of a guarantee as a condition for a stay of enforcement — Whether the State needed to prove that the posting of a guarantee would be a significant burden to avoid being required to post a guarantee
Annulment — Manifest excess of powers — ICSID Convention, Article 52(1)(b) — Whether the tribunal exceeded its powers in accepting jurisdiction ratione materiae over professional services — Whether the tribunal exceeded its powers by failing to apply a provision of the BIT that was not specifically adduced in the arbitration proceeding
Annulment — Investment — Professional services — ICSID Convention, Article 25(1) — Salini test — Whether the existence of a contribution to the economic development of the host State was an essential characteristic of an investment
Annulment — ICSID Convention, Article 52(1)(e) — Whether the tribunal failed to state reasons in accepting jurisdiction ratione materiae over professional services — Whether the tribunal failed to state reasons with respect to its failure to apply certain provisions of the BIT that were not adduced in the arbitration proceeding — Whether the tribunal failed to state reasons with respect to the calculation of the compensation due to the claimant
16 - ICSID Convention Annulment Proceedings
- from Part III - The Settlement of Investor–State Disputes
- Yannick Radi
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- Book:
- Rules and Practices of International Investment Law and Arbitration
- Published online:
- 08 October 2020
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- 29 October 2020, pp 468-480
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Summary
The Convention on the Settlement of Investment Disputes between States and Nationals of Other States (ICSID Convention) provides for a ‘self-contained’ annulment mechanism independent from domestic courts and laws. This mechanism is available to challenge the awards rendered by arbitration tribunals operating only under this Convention. Chapter 16 focuses on the annulment proceedings that this Convention establishes, while annulment in other contexts is dealt with in Chapter 11. More specifically, it first sheds light on the main features of ICSID Convention annulment proceedings before analysing in light of the relevant arbitration practice the main grounds for annulment relied upon before annulment committees – namely, manifest excess of powers, serious departure from a fundamental rule of procedure and failure to state reasons. Chapter 16 then provides an overview of the two additional grounds mentioned in the Convention: improper constitution of a tribunal and corruption on the part of a member of the tribunal.
Sempra Energy International v. Argentine Republic
- ICSID (Arbitration Tribunal). 11 May 2005 28 September 2007 18 September 2007 5 March 2009 7 August 2009 29 June 2010
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- Journal:
- ICSID Reports / Volume 18 / 2020
- Published online by Cambridge University Press:
- 01 January 2021, pp. 109-154
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- 2020
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Jurisdiction — Applicable law — ICSID Convention, Article 42(1) — ICSID Convention, Article 25 — Whether the choice of applicable law on the merits applied also to the jurisdictional phase
Jurisdiction — Nationality — ICSID Convention, Article 25(2)(b) — Whether nationality requirements were cumulative or alternative — Whether an investor not exercising control may bring a claim — Whether the interests of foreign investors may be combined
Jurisdiction — Dispute — ICSID Convention, Article 25(1) — Whether the dispute was of a legal nature — Whether dispute arose directly from an investment
Foreign investor — Investment — Minority or indirect shareholding — Whether a minority shareholding qualified as an investment
Jurisdiction — Negotiation — Whether an ongoing renegotiation of licences with the State was a ground to decline jurisdiction
Jurisdiction — Forum selection — Submission to local jurisdiction — Whether contract-related disputes may be submitted to ICSID tribunal
Expropriation — Direct expropriation — Whether transfer of property rights to the State was an essential requirement of direct expropriation
Expropriation — Indirect expropriation — Whether there was substantial deprivation of property rights
Fair and equitable treatment — Legitimate expectation — Whether State measures substantially changed the legal and business framework under which the investment was made
Umbrella clause — Whether breach arose from conduct of an ordinary contract party or involved sovereign State function — Whether the obligation was related to a specific investment agreement
Arbitrary or discriminatory measures — Economic crisis — Whether measures adopted were arbitrary or discriminated against the investor
Full protection and security — Legal protection — Whether the standard of full protection and security expanded beyond physical protection
Defence — Emergency measures — Municipal law — Whether national emergency measures were legally justified under municipal law
Defence — Necessity — ILC Articles on State Responsibility, Article 25 — Customary international law — Whether measures were adopted to safeguard an essential interest — Whether there existed a grave and imminent peril — Whether the measures adopted were the only way to offset the economic crisis — Whether the State contributed to the situation giving rise to necessity
Defence — Exclusions and reservations — Essential security interests — Interpretation — Whether an economic emergency qualified as an essential security interest — Whether the provision was self-judging — Whether the provision should be interpreted in light of customary international law
Defence — Necessity — ILC Articles on State Responsibility, Article 27 — Customary international law — Temporality — Whether the state of necessity was still justified — Whether compensation might be owed for measures adopted during the state of necessity
Remedies — Damages — Whether crisis had incidence on the amount of compensation — Whether a renegotiated agreement had incidence on amount of compensation
Remedies — Interest — Whether post-award interest must be expressly requested in the petition for relief
Procedure — Stay of enforcement — ICSID Convention, Article 52(4) — Whether there was a presumption in favour of granting a stay — Whether an annulment committee was empowered to impose conditions on the granting of stay
Procedure — Stay of enforcement — ICSID Convention, Article 53 — ICSID Convention, Article 54 — Whether the creditor must have recourse to domestic enforcement procedure — Whether circumstances and history of non-compliance called for assurances
Procedure — Stay of enforcement — Whether the State demonstrated economic hardship — Whether escrow eliminated risk of non-recoupment
Procedure — Termination of stay — Whether the risk of third-party creditors seizing escrow funds justified non-compliance with conditions on the granting of stay
Annulment — Manifest excess of powers — Failure to state reasons — ICSID Convention, Article 52(1) — Jurisdiction — Investment — Minority or indirect shareholding — Whether the tribunal’s conclusions on standing constituted grounds for annulment
Annulment — Manifest excess of powers — ICSID Convention, Article 52(1) — Defence — Exclusions and reservations — Whether equating a treaty provision with the standard under customary international law constituted a failure to apply the applicable law — Whether excess of power was manifest
Annulment — Costs — Whether the rule that costs follow the event was in line with equitable principles
Continental Casualty Company v. Argentine Republic
- ICSID (Arbitration Tribunal). 22 February 2006 5 September 2008 16 September 2011
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- Journal:
- ICSID Reports / Volume 18 / 2020
- Published online by Cambridge University Press:
- 01 January 2021, pp. 155-198
- Print publication:
- 2020
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Jurisdiction — Dispute — ICSID Convention, Article 25(1) — Whether dispute was of a legal nature — Whether the dispute arose out of an investment — Whether the claim was premature
Jurisdiction — Investment — Whether a foreign investor had standing to bring claims for damages suffered by the assets, investments and activities of its local subsidiary
Procedure — Addition of a party — ICSID Convention, Article 25(2)(b) — ICSID Convention, Article 46 — Whether the local subsidiary of the claimant could be added as a party to the dispute — Whether the request for addition could be made by the claimant — Whether the claims of the local subsidiary needed to be different from those of the foreign parent
Interpretation — World Trade Organization — International Monetary Fund — Whether the norms of multilateral economic institutions assisted in investment treaty interpretation
Defence — Necessity — Exclusions and reservations — Public order — Essential security interests — Margin of appreciation — Customary international law — World Trade Organization — Whether the strict conditions of application for the plea of necessity under customary international law applied to the safeguard clause — Whether the economic crisis required the maintenance of public order or the protection of essential security interests — Whether the law of the World Trade Organization assisted in the interpretation of the defence — Whether the State had any reasonably available alternatives that were more compliant with its international obligations — Whether the State was barred by its own conduct from relying on the defence
Defence — Necessity — ILC Articles on State Responsibility, Article 25 — Customary international law — Whether the defence under general international law was available in the alternative
Free transfer — Interpretation — International Monetary Fund — Whether a currency transfer impeded by a bank freeze was related to an investment — Whether the provisions and principles of the International Monetary Fund assisted in interpretation of the investment treaty standard
Fair and equitable treatment — Legal stability — Legitimate expectation — Taxation — Whether the expectation of stability in the exchange and currency regime was legitimate and protected by the BIT — Whether unilateral restructuring of governmental financial instruments was reasonable once the economic crisis had ended — Whether imposition of a capital tax on a nominal gain resulting from currency devaluation was in breach of fair and equitable treatment
Expropriation — Indirect expropriation — Monetary sovereignty — Municipal law — Constitutional law — Taxation — Whether sovereign management of the exchange rate could result in an indirect expropriation — Whether compulsory currency conversion was protected from expropriation under constitutional law — Whether constitutional court decisions were relevant — Whether a breach of constitutional law amounted to an expropriation under international investment law — Whether losses for payment delays could be considered an expropriation — Whether unilateral restructuring of governmental financial instruments was an expropriation — Whether imposition of a capital tax on a nominal gain resulting from currency devaluation was an expropriation
Umbrella clause — Whether the State entered into any commitments with regard to investments — Whether the standard applied to contractual undertakings made to a local subsidiary — Whether domestic laws addressed to the general public created obligations specific to a foreign investor
Remedies — Interest — Compound interest — Whether simple or compound interest should be awarded in the circumstances
Annulment — Manifest excess of powers — Failure to state reasons — Serious departure from a fundamental rule of procedure — ICSID Convention, Article 52(1) — Whether the tribunal failed to decide the investor’s claim for loss after the state of necessity was over — Whether the tribunal failed to determine the investor’s expropriation claim in relation to unilateral restructuring of governmental financial instruments — Whether the tribunal failed in its construction of the scope of freedom of transfer — Whether the tribunal failed to explain why the State could no longer rely on the necessity defence — Whether the tribunal had awarded damages on a ground not invoked by the investor
Annulment — Procedure — Whether an annulment committee may consider an additional ground on its own motion
Von Pezold, Von Pezold, Webber, Von Pezold, Batthyàny, Von Pezold, Von Pezold, Von Pezold and Von Pezold v. Republic of Zimbabwe
- ICSID (Arbitration Tribunal). 28 July 2015 21 November 2018
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- Journal:
- ICSID Reports / Volume 18 / 2020
- Published online by Cambridge University Press:
- 01 January 2021, pp. 360-392
- Print publication:
- 2020
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Jurisdiction — Foreign investor — ICSID Convention, Article 25(2) — Whether the requirements of foreign nationality or control were satisfied
Jurisdiction — Investment — ICSID Convention, Article 25 — Salini test — Origin of capital — Whether the claims related to foreign investments fulfilling the applicable test
Jurisdiction — Standing — Whether the claimants had standing to bring a claim for loss in respect of assets held by local companies
Jurisdiction — Provisional application — VCLT, Article 25 — Whether the parties to the BIT agreed to provisional application prior to the date of its ratification
State responsibility — Attribution — ILC Articles on State Responsibility, Article 4 — ILC Articles on State Responsibility, Article 8 — ILC Articles on State Responsibility, Article 11 — Customary international law — Whether the State could be held responsible for police inaction in the face of the unlawful occupation movement — Whether the occupation movement was under the direct order or control of the State
Defence — Proportionality — Margin of appreciation — Whether land expropriations could be justified as a proportionate exercise of State regulatory powers — Whether a margin of appreciation may be applied in the context of investment treaty disputes
Expropriation — Direct expropriation — Compensation — Non-discrimination — Due process — Public purpose — Whether the taking of land complied with the conditions of a lawful expropriation — Whether direct debit from bank accounts and seizure of grain at less than market price constituted unlawful expropriations
Expropriation — Indirect expropriation — Whether assets that were not directly expropriated but were no longer commercially viable were unlawfully expropriated — Whether changes to water permits were so significant as to constitute expropriation — Whether refusal to release foreign currency led to expropriation of an unpaid loan
Fair and equitable treatment — Legitimate expectation — Whether the State provided specific assurances that the investors would not be expropriated — Whether changes to water permitting without compensation violated legitimate expectations — Whether restrictions on foreign currency and exchange were in breach of fair and equitable treatment
Full protection and security — Law enforcement — Whether the State took all reasonable measures to remove occupiers from the investors’ land — Whether the police were overwhelmed or would have needed to use disproportionate force — Whether responsibility was excepted by a situation of war or revolution
Free transfer — Whether refusal to release foreign currency and imposition of local currency constituted an investment treaty breach
Defence — Necessity — ILC Articles on State Responsibility, Article 25 — Customary international law — Whether property invasions should be considered a threat to an essential interest of the State — Whether there was an essential interest of the State at stake — Whether there was a grave and imminent peril to the existence of the State or merely the incumbent political party — Whether the acts of State were the only way to stop the occupations — Whether the measures were in violation of obligations erga omnes not to discriminate based on race — Whether the State contributed to the situation
Remedies — Restitution — Whether it was possible to reinstate title to expropriated land
Remedies — Damages — Whether there was a compensable difference between the value of land as is and but for the unlawful measures due to damage and loss of productivity
Remedies — Moral damages — Whether exceptional circumstances existed to award moral damages — Whether corporate claimants may be awarded moral damages
Annulment — Serious departure from a fundamental rule of procedure — ICSID Convention, Article 52(1) — Whether the State had been denied an opportunity to present a case on illegality due to procedural orders on admissibility
Annulment — Serious departure from a fundamental rule of procedure — Composition of tribunal — Corruption of tribunal member — ICSID Convention, Article 52(1) — Waiver — Whether the late disclosure of the tribunal president’s role with another World Bank body formed a basis for annulment — Whether the State waived its right to challenge the arbitrator
Annulment — Manifest excess of powers — ICSID Convention, Article 52(1) — Whether the tribunal failed to apply the proper law for the defence of necessity and legality of investments
Churchill Mining Plc and Planet Mining Pty Ltd v. Republic of Indonesia
- ICSID (Arbitration Tribunal). 24 February 2014 24 February 2014 6 December 2016 18 May 2019
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- Journal:
- ICSID Reports / Volume 18 / 2020
- Published online by Cambridge University Press:
- 01 January 2021, pp. 527-553
- Print publication:
- 2020
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Jurisdiction — Consent — ICSID Convention, Article 25(1) — Meaning of “shall assent” — Whether the State consented in writing to ICSID arbitration — Whether the BITs contained standing offers to arbitrate — Whether the State subsequently consented to arbitrate in approving the local investment vehicle — Whether the subsequent act of consent extended to foreign shareholders
Jurisdiction — Investment — Legality — Whether an admission requirement was restricted to the time when the investment was made or extended to subsequent performance — Whether local consent satisfied the admission requirement — Whether a government body was authorised to grant consent
Applicable law — Fraud — ICSID Convention, Article 42(1) — Whether international or municipal law governed allegations of forgery and deception
Evidence — Fraud — Burden of proof — Standard of proof — Whether the State bore the burden of proof under international law — Whether the standard was balance of probabilities — Whether the State was required to prove motive or intent
Evidence — Adverse inferences — Whether the tribunal was required to draw adverse inferences from a failure to produce documents
Evidence — Fraud — Whether signatures on official documents were authentic and authorised — Whether there was sufficient evidence to support a finding of corruption — Whether there was sufficient evidence to find that the investors were authors of fraud
Procedure — Fraud — Whether an allegation of forgery should be addressed as a matter of jurisdiction, admissibility or merits
Admissibility — Fraud — Good faith — Abuse of rights — Third-party misconduct — Wilful blindness — International public policy — Whether an investor may bring a claim based on rights arising from fraud or forgery which the investor deliberately or unreasonably ignored — Whether the fraud was serious — Whether the investor exercised a reasonable level of due diligence — Whether the underlying fraud affected the validity of later instruments
Annulment — Serious departure from a fundamental rule of procedure — ICSID Convention, Article 52(1) — Right to be heard — Whether the tribunal’s refusal to allow further evidence constituted a breach of the right to be heard — Whether the tribunal had considered evidence that had been excluded — Whether there was unequal treatment in the tribunal’s decision to allow the State not to produce police files — Whether the tribunal failed to draw adverse inferences from the non-production of police files — Whether the investors were denied the right to be heard on the validity of licences under municipal law and denial of justice in local courts — Whether the tribunal denied the right to present arguments on the law of State responsibility
Annulment — Manifest excess of powers — ICSID Convention, Article 52(1) — Whether the tribunal had failed to apply the applicable law in determining the issue of admissibility
Annulment — Failure to state reasons — ICSID Convention, Article 52(1) — Whether the tribunal failed to state the reasons on which the award was based
Quiborax S.A., Non-Metallic Minerals S.A. and Fosk Kaplún v. Plurinational State of Bolivia
- ICSID (Arbitration Tribunal). 26 February 2010 27 September 2012 16 September 2015 7 September 2015 18 May 2018
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- Journal:
- ICSID Reports / Volume 18 / 2020
- Published online by Cambridge University Press:
- 01 January 2021, pp. 393-420
- Print publication:
- 2020
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Procedure — Provisional measures — ICSID Convention, Article 47 — ICSID Arbitration Rule 39 — Whether criminal proceedings and corporate audits affected the claimants’ right to the preservation of the status quo and to non-aggravation of the dispute — Whether the criminal proceedings impaired the claimants’ right to present their case — Whether the claimants satisfied the criteria of urgency, necessity and proportionality — Whether a stay of criminal proceedings would affect sovereignty or be contrary to municipal law
Procedure — Exclusivity — ICSID Convention, Article 26 — Whether the exclusivity of the arbitral proceedings was threatened by the continuation of local criminal proceedings
Admissibility — ICSID Arbitration Rule 34(1) — Whether evidence from criminal proceedings was admissible
Jurisdiction — Foreign investor — ICSID Convention, Article 25 — Whether investors had acquired shares in a local company — Whether the shareholders engaged in fraud or fabricated evidence to gain access to arbitration — Whether a local company may be treated as the national of another State due to foreign control
Jurisdiction — Investment — ICSID Convention, Article 25 — Whether each investor satisfied the objective elements of an investment
Jurisdiction — Legality — Estoppel — Whether the State was estopped from contesting the legality of the investments — Whether there was any fraud or non-trivial violation of the host State’s legal order or foreign investment regime at the time when the investment was established
Admissibility — Foreign investor — Good faith — Whether a shareholder must advise the host State of its foreign nationality
Defence — Legality — Municipal law — Whether the defence was admissible — Whether the investment was obtained through an irregular process that benefited former public officials — Whether the investment was null and void ab initio under municipal law
Defence — Exhaustion of remedies — Fork-in-the road clause — Whether the claims were premature
Defence — Police powers — Customary international law — Whether an executive decree constituted a legitimate revocation of concessions based on actual violations of municipal law — Whether the revocation was carried out in accordance with due process
Expropriation — Direct expropriation — Lawfulness — Discrimination — Whether the revocation of concessions directly expropriated the investment of the foreign-controlled local company — Whether the expropriation complied with conditions for lawful expropriation
Expropriation — Indirect expropriation — Substantial deprivation — Whether direct expropriation of the foreign-controlled local company substantially deprived its shareholders of value
Fair and equitable treatment — Minimum standard of treatment — Impairment — Whether revocation of the concessions violated the minimum standard of treatment — Whether subsequent annulment of the concessions was a bona fide exercise of police powers or an ex post attempt to improve an arbitral defence
Remedies — Damages — Customary international law — Whether assessment of full reparation allowed for use of ex post data up to the date of the award
Remedies — Interest — Applicable law — Whether international law or municipal law applied to whether interest should be compounded
Remedies — Satisfaction — ILC Articles on State Responsibility, Article 37 — Customary international law — Whether the tribunal had jurisdiction to make a declaration — Whether the State’s conduct during the arbitral proceeding, including alleged harassment through criminal proceedings and failure to comply with provisional measures, warranted declaratory relief
Remedies — Moral damages — Whether any specific moral injury satisfied the threshold of exceptional circumstances
Costs — Whether it was fair in the circumstances for the State to bear the costs of arbitration
Annulment — Jurisdiction — Provisional measures — ICSID Convention, Article 52 — Whether the committee had jurisdiction to annul provisional measures
Annulment — Manifest excess of powers — ICSID Convention, Article 52(1) — Whether the tribunal’s findings on municipal law were in manifest excess of powers — Whether the tribunal acted in manifest excess of powers in determining the existence of protected investments — Whether the tribunal acted in manifest excess of powers by failing to apply the applicable law for quantum
Annulment — Serious departure from a fundamental rule of procedure — ICSID Convention, Article 52(1) — Whether the State was denied the right to be heard on the valuation methodology
Annulment — Failure to state reasons — ICSID Convention, Article 52(1) — Quantum — Whether the tribunal failed to state the reasons for its decision on quantum
On judicial autonomy and the autonomy of the parties in international adjudication, with special regard to investment arbitration and ICSID annulment proceedings
- Attila M. Tanzi
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- Journal:
- Leiden Journal of International Law / Volume 33 / Issue 1 / March 2020
- Published online by Cambridge University Press:
- 11 November 2019, pp. 57-75
- Print publication:
- March 2020
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The article addresses the relationship between judicial autonomy and the autonomy of the parties principles. The issue is not addressed so much through the lens of the procedural rules on the conduct of the proceedings, as through the prism of the general principles of adjudication which dictate the boundaries of judicial, or arbitral, decision-making. The focus will be on the combination between the principles ne, ultra and infra, petita and non liquet as they flow from the consensual nature of international adjudication and arbitration, on the one hand, and the principle jura novit curia which mirrors the autonomy of the judicial function, on the other. The analysis does not draw from national legal systems, nor from commercial arbitration. Due to the significantly different configuration of the principles at issue in different jurisdictions, it will focus on international litigation as an autonomous phenomenon. It will address firstly inter-state adjudication and then international investment arbitration. Special attention will be given to the ICSID system in consideration of its unique annulment mechanism. The article draws from researched case law an encouragement, if not simply the need, for international adjudicative bodies to undertake a proactive attitude in the conduct of the proceedings. More generally potentials emerge from the analysis, to the effect that not only inter-state adjudication may impact on investor-state arbitration, but also vice versa.
Helnan International Hotels A/S v. The Arab Republic of Egypt
- ICSID (Arbitration Tribunal). 17 October 2006 3 July 2008 14 June 2010
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- Journal:
- ICSID Reports / Volume 17 / 2016
- Published online by Cambridge University Press:
- 01 January 2021, pp. 258-343
- Print publication:
- 2016
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Evidence — Production of evidence — Request for evidence from another ICSID dispute — ICSID Convention, Article 43 — IBA Rules on the Taking of Evidence in International Commercial Arbitration, Article 3
Jurisdiction — Jurisdiction ratione temporis — Distinction between “divergences” and “disputes” — Criteria for “crystallization” of disputes — Whether dispute crystallized after entry into force of the BIT — Whether modification of contract affects crystallization of dispute
Jurisdiction — Jurisdiction ratione materiae — ICSID Convention, Article 25(1) — Definition of investment — Conditions for a contract to be an investment
Jurisdiction — Jurisdiction ratione personae — ICSID tribunal’s duty to resolve jurisdictional issue — Attribution of acts of a state-owned company to the State — ILC Articles on State Responsibility, Article 5 — Whether state-owned company exercised governmental authority
Jurisdiction — Objections to jurisdiction raised in merits phase — ICSID Arbitration Rules, Rule 41(1) — Whether delay in jurisdictional objection constitutes waiver — ICSID Convention, Article 25(1) — Requirement that dispute arises out of an investment — Whether jurisdiction if investment ceases to exist
Admissibility — Res judicata, conditions of — Whether domestic arbitral award has res judicata effect in ICSID proceedings — Effect on ICSID proceedings of award’s recognition under the New York Convention on the Recognition and Enforcement of Foreign Awards
State responsibility — Suspicious conduct of authorities — Whether inappropriate conduct of authorities sufficient to establish breach of BIT obligations — Contractual nature of allocation of responsibility for actions or omissions
Jurisdiction — Exhaustion of local remedies — Whether exhaustion of local remedies a pre-condition to BIT arbitration
Foreign investment — Fair and equitable treatment — Whether recourse to domestic arbitration of investor’s partner a breach of the BIT — Investor’s freedom to appoint arbitrator — Whether enforcement of domestic arbitration award a breach of the BIT
Foreign investment — Fair and equitable treatment — Relations between parties to a contract — Whether less favourable treatment of investor by contractual partner a breach of the BIT — Whether control by State sufficient to attribute conduct of state-owned company to State — Whether conduct being a coordinated plan by State against investor — Contractual rights and treaty rights
Expropriation — Termination of contract as expropriation — Involvement of state authorities in plan aimed at termination of contract — Whether investor’s failure to challenge authorities’ conduct in domestic courts disqualified BIT expropriation claim
Costs — Allocation of costs between parties — ICSID Convention, Article 61(2) — Rule 28 of the ICSID Arbitration Rules — Specific criteria for allocation of costs
Annulment — Function of annulment committee — ICSID Convention, Article 52 — No reconsideration of findings of fact
Annulment — Serious departure from a fundamental rule of procedure — ICSID Arbitration Rules, Rule 34(1) — Evaluation of evidence presented by the parties — Opportunity for parties to present their case — Tribunal’s right to reach its own conclusions as to interpretation and weight of evidence
Annulment — Failure to state reasons — ICSID Convention, Article 52(1)(e) — No requirement to discuss every argument raised by parties
Annulment — Manifest excess of powers — ICSID Convention, Article 52(1)(b) — Scope of ICSID tribunal’s powers based on agreement of parties — Failure to decide a question entrusted to the tribunal as manifest excess of powers — Intention of States parties to BIT
Annulment — Exhaustion of local remedies — Whether exhaustion of local remedies pre-condition to BIT arbitration — Reliance on prior ICSID award where facts different — Effects of requirement of exhaustion of local remedies on ICSID arbitration
Annulment — Annulment of part of the award — Effect on the award
Annulment — Manifest excess of powers — ICSID Convention, Article 52(1)(b) — Distinction between breach of treaty and breach of contract — Reliance by ICSID tribunal on domestic arbitration to analyse alleged breach of treaty
Azurix Corporation v. Argentine Republic
- ICSID (Ad hoc Committee). 28 December 2007 1 September 2009
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- Journal:
- ICSID Reports / Volume 17 / 2016
- Published online by Cambridge University Press:
- 01 January 2021, pp. 528-658
- Print publication:
- 2016
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Annulment — Stay of enforcement — ICSID Convention, Article 52(1) — Provision of security — Discretion of ad hoc committee to decide on security — Burden on claimant to show security required — Annulment proceeding not an exceptional circumstance justifying security
Annulment — Manifest excess of powers — ICSID Convention, Article 52(1)(b) — Meaning of “manifestly” — “Test” of manifest excess of powers — Whether tribunal had manifestly acted without jurisdiction — ICSID Convention, Article 41(2) — Tribunal as judge of its own competence — Whether manifest lack of jurisdiction if decision under Article 41(2) incorrect
Annulment — Function of annulment committee — No appeal or de novo review
Foreign investment — Standing — Investment through company — Controlling shareholding — When investor not legal owner of assets constituting investment — When investor not party to contract giving rise to rights constituting an investment — Investor’s financial and commercial interest in the investment — Separate legal personalities and rights and obligations of shareholders and company — Right of shareholder to pursue investment treaty claim — ICSID Convention, Article 25(2)(b) — Multiple proceedings — ICSID proceedings of shareholders in light of proceedings brought by company in national courts — Prevention of double recovery
Applicable law — Annulment — Whether tribunal disregarded applicable law — ICSID Convention, Article 42 — ICSID Convention, Article 52(1)(b) — BIT governed by international law — ICSID Convention, BIT and international law as applicable law — Municipal law helpful in determining breach of BIT — General principles of international law — Applicable law in determination of “fair and equitable” standard
Annulment — Failure to state reasons — ICSID Convention, Article 52(1)(e) — Whether the award contained contradictory statements — Tribunal’s refusal to consider an issue — Whether serious departure from fundamental rule of procedure
Annulment — Denial of fundamental evidence — ICSID Convention, Article 43(a) — ICSID Arbitration Rule 34(2) — Tribunal’s discretionary power to call upon a party to produce documents — No right of party to obtain evidence from opposing party — Inequality of treatment of parties — Application of different standards in admission of evidence
Procedure — Composition of tribunal — Disqualification of arbitrator — ICSID Convention, Article 52(1)(a) — ICSID Convention, Articles 57 and 58 — No right to de novo review of challenge of arbitrator — Waiver of rights to raise objections — Estoppel from raising objections
Annulment — Damages — ICSID Convention, Article 52(1)(a) — Tribunal’s discretion to apply “fair market value” standard
Annulment — Costs of annulment proceedings — Administrative and Financial Regulations, Regulations 14(3)(d) and 14(3)(e) — Applicant to bear costs of entirely unsuccessful application