Home Posts tagged "Investment Arbitration"

An Analysis of the Use of ICJ Jurisprudence in Investor-State Dispute Settlement

Published on May 13, 2019        Author: 

Last October 2018, the International Court of Justice (“ICJ” or “the Court”) issued its merits judgment in Obligation to Negotiate Access to the Pacific Ocean (Bolivia v. Chile). In a brief passage, the Court summarily dismissed Bolivia’s argument that the doctrine of “legitimate expectations” exists in general international law outside the context of fair and equitable treatment clauses. Despite the brevity of the Court’s analysis – and the minor importance of the legitimate expectations issue in that case – this finding drew attention from media outlets dedicated to investor-State dispute settlement (“ISDS”), including IAReporter. That the discussion of legitimate expectations in the Bolivia v. Chilejudgment was considered newsworthy in the ISDS sphere is a reflection of the importance that ISDS practitioners place on ICJ jurisprudence. As Professor Alain Pellet observed in a 2013 lecture, “[n]ot only do … investment tribunals… refer to the jurisprudence of the World Court, but they show a particular deference to it.”

There is some evidence, discussed below, to suggest that ISDS tribunals have referred to ICJ jurisprudence with increased frequency in recent years. Moreover, as ICJ President Abdulqawi Ahmed Yusuf highlighted in his October 2018 speech to the U.N. General Assembly, the Court today is particularly busy. There may thus be even more opportunities for jurisprudential cross-pollination in the near future. Now is an opportune time to consider why, when, and how investor-State tribunals refer to ICJ jurisprudence.

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Can Investment Arbitration Fix Itself?

Published on October 31, 2018        Author:  and

This week, States have descended on UNCITRAL in Vienna to discuss potential reform of the investor-state dispute settlement (ISDS) system. Many are in a critical mood. During the April session in New York, delegates raised concerns over excessive costs, lack of arbitral diversity, conflicts of interests, inconsistent outcomes, and bias against developing states. More surprising – for many observers – was the appetite for ‘systemic’ reform. Many states have signalled openness to an appellate mechanism and the EU is mobilising support for a more ambitious multilateral investment court. The result is that the pros and cons of different reform models is an emerging field of research.

A question less considered is whether the system might reform itself in the face of state backlash. Could the threat of reform be enough? Elsewhere, we have seen that international courts are sensitive to stakeholder opinion – they can read the writing on the wall. In the WTO, Creamer found that a 10 percent rise in state criticism increases the average panel validation of trade restrictions by 17 percent. Larrson and Naurin found that the probability of the Court of Justice of the European Union (CJEU) ruling for a pro-European position is highly dependent on the direction of third-party state observations. Stiansen and Voeten found similar trends for the European Court of Human Rights after a rising state backlash, although not in the same magnitude.

Could the same pattern apply to international investment arbitration? Might arbitrators sniff the wind and change course lest the system fall into disrepute and disuse? In a newly published article in the European Journal of International Law, we try to answer this question. Read the rest of this entry…

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