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The dissenting opinion in BG v Argentina before the US Supreme Court

As reported earlier, the US Supreme Court has recently adjudicated on the issue of the standard of review in relation to arbitration agreements in international investment arbitration.

It is a fact that the majority of the Court has decided that deference should be given to arbitral tribunals to examine questions of procedural conditions, as it characterized the issue of litigation before the domestic courts of Argentina for 18 months before initiating arbitral proceedings. It seemed to the majority of the Court that the issue pertains to whether a duty to arbitrate arises, and not whether such a duty exists at all.

In determining the issue at hand, the majority found that the United Kingdo [...]

Apropos of ConocoPhillips v. Venezuela: Revision of Earlier Decisions in Fragmented Proceedings – A Matter of Principle?

Apropos of a recent decision in ConocoPhillips v. Venezuela (ICSID Case No ARB/07/30), this post discusses the potential underlying concerns an arbitral tribunal may consider when deciding whether it can revise earlier decisions within the context of fragmented proceedings.

Background

The ICSID proceedings in ConocoPhillips v. Venezuela (ICSID Case No ARB/07/30) commenced in November 2007 under the Netherlands-Venezuela Bilateral Investment Treaty (the “BIT”) and Venezuela’s Foreign Investment law (the “Foreign Investment Law”). The arbitration concerns the Claimants’ interests in two extra-heavy oil projects located in the region in Venezuela known as the Orinoco Oil Belt (Faja Petrolífera [...]

Investment Arbitration: Legal Implications of the Threat to Expropriate

and Oleg Temnikov

I. Foreword
At the end of 2013, the Financial Times reported that a referendum will be held in Berlin on the question whether the State shall take over power supply from the hands of Vattenfall. We use this as an occasion to examine the legal implications in the field of investment arbitration of the threat to expropriate.

II. The views “against” the unlawfulness of a threatened expropriation
In the first place, it must be noted that the existing BITs do not, in general, sanction threats to expropriation, but only the completed act. There are, for example, BITs which provide that “compensation shall be equivalent to the value of the expropriated investment immediate [...]

BITs as Contracts, and Lurking Consent Issues: BG Group v. Republic of Argentina

Introduction
In BG Group v. Republic Argentina, a divided U.S. Supreme Court (“the Court”) continued to hold that arbitrators are the proper decision makers in gateway questions of arbitrability, not courts. The issue here concerned whether or not the local litigation requirement in the U.K-Argentina BIT was a procedural prerequisite to investor-state arbitration, or a necessary substantive step needed prior to the formation of an agreement to arbitrate. The Court’s decision also left open the possibility that clear language evidencing consent by a State could lead to a different outcome. Justice Sotomayor joined the majority, and wrote a separate concurrence regarding conditions of co [...]

Introduction of Labour Standards in Investment Arbitration

The recent Bangladesh factory disaster has brought the plight of labourers in developing countries to the forefront in the international arena. Reforms in the labour legislations in Bangladesh have been demanded, which could lead to the implementation of stricter labour standards in the country. This could possibly lead to investment arbitration claims against Bangladesh, if stricter labour laws cause substantial losses to the multinational companies. However, the question of labour standards in investment arbitration has very rarely been examined, either by investment tribunals or by academicians. This post tries to examine how labour standards could be considered in investment arbitration [...]

Potential Investor-State Dispute Settlement Provisions in Trans-Pacific Partnership Agreement – A Change in Policy for Australia?

By Beth Cubitt and Tom French

The proposed Trans-Pacific Partnership Agreement (TPPA) – a multi-lateral agreement proposed between a number of countries, currently including Australia, Canada, Japan, Malaysia, Mexico, Peru, the United States and Vietnam (although it is hoped to be an open platform welcoming other countries to participate) – is currently the subject of much debate. TPPA countries will potentially account for approximately 39% of the world’s GDP, with Australia’s portion of trade representing AUD215 million. By 2025, the TPPA is expected to account for USD233 billion in trade per year, and is said to set the “economic architecture” for the region.
But will the TPPA contain i [...]

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