Creating Conduits: Summary Report of the First Annual Oxford Investment Claims Summer Academy, St. Anne’s College (Oxford)

This July 13-14, Oxford University Press and Investment Claims convened the First Annual Oxford Investment Claims Summer Academy at St. Anne’s College, the University of Oxford. Co-chaired by Diane Desierto, Ian Laird, and Frederic Sourgens, the Academy brought together a select expert group of academic and practitioner delegates to discuss the legitimacy of investor-state arbitration in the context of continuous and often virulent political criticism. The method and structure of the Academy departed from a traditional presentation format. Instead, the Academy as the first gathering of experts of its kind acted as a laboratory for open and rapid discussion of frontier issues among all participants. As a result of this format, the Academy constructively explored both traditional text-based and context-sensitive solutions for these frontier issues. ICJ Judge James Crawford’s keynote address to the delegates aptly captured the spirit of the open and critical discussion when noting that while there is little in the way of feasible alternative to investor-state arbitration and much to lose by its abolition. Bench, bar, and ivory tower must find it in them to become better stewards of this mode of international dispute resolution. In particular, there is an urgent need to address weaknesses made visible by the first two decades of sustained arbitral and annulment jurisprudence. With the depth of engagement at the inaugural session, the co-chairs are planning to hold the Academy again in the summer of 2016.

The Academy was divided over two days into five panels and three research discussions. The panels addressed the nature of consent to investor-state arbitration, concerns relating to the impartiality of investor-state tribunals, the nature of applicable law in investor-state arbitration, and the handling of evidence by investor-state tribunals. The research discussions engaged the appropriate use of human rights and public policy in international economic law and the practice of treaty interpretation evolving in investor-state arbitration. The Academy closed with a summary panel addressing whether, as US Senator Elizabeth Warren charged, investor-state tribunals are in fact “rigged pseudo-courts”.

The first panel addressed the nature of consent to investor-state arbitration and the consequent timing and nature of vesting of investor rights. The panel thus asked whether states consenting to investor-state arbitration remained at liberty to alter their bargains pursuant to traditional rules of the Vienna Convention on the Law of Treaties or whether reasonable investor reliance could frustrate such attempts. It discussed various alternative conceptions of consent and vesting from delegated authority theories to third party beneficiary accounts to a unilateral act approach. The discussion addressed the repercussions of these theories for proposals currently discussed in the European Union to use traditional treaty rules to modify and terminate certain investment treaties as one practical application of the panel discussion. Borzu Sabahi moderated the session with discussion leaders Andrea Bjorklund, and Frederic Sourgens.

The Academy next considered the chapters immediately relevant to investment treaties from Diane Desierto’s Public Policy in International Economic Law, The ICSCR in Trade, Finance, and Investment (OUP: 2015). The session amply elucidated the role of, and considered account for, human rights obligations in framing public policy questions in the application of investment treaties. It importantly pointed to the need of expanding the cognitive horizon of both academics and practitioners beyond seeing investment treaties, and their relationship to human rights conventions, as purely dispute-driven instruments and instead utilize them in informing procurement and investment-design decisions. Freya Baetens provided her review of the book, and led the Academy participants and the author in discussion.

The second panel addressed the perception of bias in investor-state arbitration. It asked whether accusations of systemic bias of the arbitral bench were well-founded and what if any corrective measures would be feasible. The discussion concluded that while there were certain systemic issues arising from multiple repeat appointments of arbitrators, these issues evidenced path dependence of counsel and parties in international arbitration rather than bias of international arbitrators. The panel further mulled that any institutionalization of investor-state dispute resolution in a court or appellate mechanism would exacerbate rather than alleviate current problems and do little to increase the diversity, in origin and outlook, of the investor-state bench. Ian Laird moderated this session, joined by discussion leaders Martins Paparinskis and Meriam Al Rashid.

The third panel addressed the question whether the law applicable to investor-state disputes functionally should be considered as a form of international public law. During the panel, delegates discussed particularly the implications of applying the rules of state responsibility and the law of treaties to disputes involving non-state actors as parties. The panel also discussed ongoing efforts at codifying a lex mercatoria publica and the likely impact upon investor-state arbitration. Diane Desierto moderated the panel with discussion leaders Todd Weiler and José Antonio Rivas.

The fourth panel focused on the treatment of evidence by investor-state tribunals. It addressed the extent to which there were limitations on the free use of evidence by international tribunals. It focused particularly upon the evidentiary issues in the context of corruption allegations, discussing relevant means, standards and burdens of proof. The panel further addressed the potential of legitimacy issues arising out of poorly reasoned awards particularly in the context of allegations of corruption. Frederic Sourgens moderated the panel led by discussion leaders Kaj Hobér and Teddy Baldwin.

The Academy next welcomed Richard Gardiner, who discussed the second edition of the highly influential Treaty Interpretation (OUP: 2015). Ian Laird and Richard Gardiner provided a detailed appraisal of the strengths and weaknesses of investor-state tribunals in applying classic principles of treaty interpretation in the investor-state context. Part of this session will shortly be available for view on www.investmentclaims.com.

The Academy closed with an appraisal of whether US Senator Elizabeth Warren’s accusation that BIT tribunals were little more than “rigged pseudo-courts” had merit, in light of the Academy proceedings focusing on critical jurisdictional, procedural and merits issues. It explored the political context of increased radicalization on both sides of the Atlantic as one cause of the criticism. It pointed out that much of the criticism had an idealized view of domestic governance structures in transitional economies – and even too rosy a view of governance structures in many advanced economies. The panel noted that the acerbic criticism levelled at investor-state arbitration was not in the least anomalous when compared to other international dispute resolution bodies. The Academy thus concluded that views regarding international dispute resolution, as such, had taken a decidedly negative turn since its heyday in the immediately post Cold-War era. But with the increased need for international dispute resolution in the investor-state realm and beyond, these currently popular parochial views seemed to many of the delegates worthwhile contesting. Andrea Bjorklund moderated this session, with discussion leaders Michael Nolan and Diane Desierto.

The Academy expert delegates were H.E. Judge James Crawford (International Court of Justice) (keynote); Diane Desierto (Hawai’i) (co-chair); Ian Laird (Crowell & Moring LLP) (co-chair); Frederic Sourgens (Washburn) (co-chair); Dapo Akande (Oxford); Meriam Al-Rashid (Pinsent Masons); Freya Baetens (Leiden); Teddy Baldwin (Baker & McKenzie); Eirik Bjorge (Oxford), Andrea Bjorklund (McGill); María Angélica Burgos (Gómez-Pinzón Zuleta); Kabir Duggal (Baker & McKenzie); Filippo Fontanelli (Edinburgh); Richard Gardiner (University College London); Kaj Hobér (Uppsala); Michael Nolan (Milbank, Tweed, Hadley & McCloy LLP); Martins Paparinskis (University College London); José Antonio Rivas (Arnold & Porter); Borzu Sabahi (Curtis, Mallet-Prevost, Colt & Mosle LLP); and Todd Weiler (independent counsel and arbitrator).