The Unavoidability of Uncertainty: One Lesson from the Recent U.S. Court Ruling in Argentina v. BG Group
It has become fashionable in recent years, each time an ICSID annulment decision is released that takes issue with the procedures or reasoning of an ICSID tribunal, for commentators to bemoan the lack of certainty, predictability and finality that this reflects in the ICSID system for adjudicating investment treaty disputes between investors and host States. Some commentators urge a return to greater use of ad hoc UNCITRAL arbitration, or arbitration before institutions other than ICSID, to avoid the perceived vagaries of the ICSID annulment process. Yet commentators often forget that these alternatives carry their own risks of uncertainty, inherent in the national court review process tha [...]
Can States Assert Counterclaims Against Investors in BIT Proceedings?
The recent decision in Spyridon Roussalis v. Romania (ICSID Case No. ARB/06/1) is prompting renewed debate over whether ICSID arbitration, now the leading mechanism for investors to pursue treaty-based claims against host States, may also be used by those States to assert related counterclaims against the investors, allowing all such claims to be settled in a single forum. At issue are certain fundamental questions about the relationship between the ICSID Convention and investment treaties as an extrinsic source of consent to arbitrate.
Article 46 of the ICSID Convention expressly requires a tribunal, if requested by a party, to determine “counterclaims arising directly out of the subject [...]
Mass claims and the distinction between jurisdiction and admissibility (Part II)
With the release of the Dissenting Opinion in Abaclat v. Agentina, we now have the benefit of a forceful critique of the majority’s decision that the Abaclat Tribunal has jurisdiction to hear the claims of over 60,000 Italian investors against Argentina under the ICSID Convention and the Argentina-Italy BIT. Professor Georges Abi-Saab’s Dissenting Opinion (the Dissent) raises a number of objections to the majority’s decision. Most importantly, it states that the Tribunal “faces two glaringly insuperable obstacles that prevent it from taking jurisdiction”. First, the investors’ security entitlements are not protected investments, in particular, because the investments were n [...]
Mass Claims and the distinction between jurisdiction and admissibility
In its 4 August 2011 Decision on Jurisdiction and Admissibility, the majority of the Tribunal in Abaclat and Others (Case formerly known as Giovanna a Beccara and Others) v. Argentine Republic affirmed that it had jurisdiction to hear the claims of over 60,000 Italian investors against Argentina arising out of Argentina’s default on various sovereign bonds. The Decision is historic in its holding that there is no impediment to mass claims under the ICSID Convention and Arbitration Rules and that ICSID tribunals have the power under ICSID Arbitration Rule 19 to adopt procedures to handle mass claims.
Although the Tribunal’s finding that it can hear mass claim has garnered the [...]
Harnessing Freedom of Investment for Green Growth
The OECD-hosted Freedom of Investment (FOI) Roundtable is in the process of finalizing a statement regarding the role of international investment in supporting the realization of countries’ green growth objectives. The draft statement entitled “Harnessing Freedom of Investment for Green Growth” (Draft Statement) and three draft background consultation papers (Draft Papers) are available on the OECD website. Over the past two months, the OECD Secretariat has sought comments on the Draft Statement and Draft Papers from various experts with an interest in the interaction between international investment and the environment. Delegates at the March 2011 Freedom of Investment Roundtabl [...]
Arbitration under the Venezuelan Foreign Investment Law – The Mobil and Cemex Decisions
Two ICSID tribunals have now weighed in on the much-debated question of whether Art. 22 of Venezuela’s Foreign Investment Law provides Venezuela’s consent to ICSID arbitration. In Decisions on Jurisdiction dated June and December 2010, the Mobil and Cemex tribunals (both presided by the former president of the ICJ, Judge Gilbert Guillaume), rejected investors’ submissions that Art. 22 can be used to establish ICSID jurisdiction, although both also held they had jurisdiction under the Dutch-Venezuelan BIT. Although the decisions are significant in the context of the wave of other ICSID arbitrations commenced against Venezuela, which also invoke Art. 22 as a basis for jurisdiction, the [...]
