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Notes on the Persistent Latin American Countries’ Attitude Towards Investment Arbitration and ICSID

Investment arbitration is a crucial and sensitive dispute-resolution method, notably because the treatment given to foreign investment matters may materially affect the economic and social realities of a country or region, particularly those in development. In the last decade, however, as already reported and addressed in this blog by, among many others, Vanessa Giraud and Carlos González-Bueno, countries in Latin America — a true hot-spot for foreign investment1 — have been either ignoring, denouncing or resisting the International Centre for Settlement of Investment Disputes (“ICSID”), the dispute-resolution framework for investment protection enacted under the Washington Convent [...]

Towards A Revised Threshold for Arbitrators’ Challenges Under ICSID?

The ICSID Convention threshold for arbitrators’ challenges, upholding challenges only if arbitrators exhibit a manifest lack of the qualities required to sit as arbitrators (Art. 57 ICSID Convention), has in the past been criticized as being too strict.

Recently, however, few decisions, discussed in this post, seem to show that the ICSID “manifest” threshold is being interpreted differently, and more in line with the more common “appearance of bias” standard.

In Blue Bank v. Venezuela, decided in November 2013, the Chairman of the World Bank Administrative Council (Chairman), Dr. Jim Yong Kim, decided and accepted the proposal to disqualify Claimant’s appointee, José María Alon [...]

Rule 41(5) of the ICSID Arbitration Rules: The Sleeping Beauty of the ICSID system

and Oleg Temnikov

The recent decision on preliminary objections, dated 17 January 2014, against the application for annulment in Elsamex S.A. v. Honduras (ARB/09/4) brought renewed interest in the procedure for summary dismissal of unmeritorious claims under Rule 41(5) of the ICSID Arbitration Rules.

The present post examines shortly this procedure as well as the implications of the above mentioned decision.

I. Characteristics
In response to criticism that no procedure exists for the expeditious dismissal of patently unmeritorious claims, in 2006, the ICSID adopted Arbitration Rule 41(5). This procedure is intended to strike a balance between the need to save time and costs and, [...]

Is Investment Arbitration in Latin America in Crisis?

Over the years Latin American countries have played an increasingly relevant role in the International Centre for Settlement of Investment Disputes (the “ICSID”), with the highest proportion – 27% – of all cases handled by the Centre. Despite the high percentage these same countries have been increasingly expressing their dislike about having to resolve their disputes through the ICSID, notwithstanding the fact that in certain Latin American countries this hostility has steadily diminished through the adoption of protective Arbitration Laws or the signing of Bilateral Investment Treaties (BITs).

The reason for this resentment is mainly because some of these governments associate the ICS [...]

The Consistency of the UNCITRAL Rules on Transparency with the Transparency Policy of Some Latin American Countries

and Felipe González Arrieta

The UNCITRAL Rules on Transparency in Treaty-based Investor-State Arbitration (hereinafter “the Rules”) came into force in April 1, 2014. The Rules were adopted at the forty-sixth session of the United Nations Commission on International Trade Law, held on July 2013, and are the result of a 3-year period effort by the Working Group II (Arbitration and Conciliation). Ensuring transparency was considered a priority for the Commission given the public interest involved in investor-State arbitration and the aim to establish a harmonized legal framework for a fair and efficient settlement of investment disputes, the increase of accountability and the promotion of [...]

Appellate Structure and Need for Legal Certainty in Investment Arbitration

Stare decisis is Latin for “to stand by things decided”. This is also a doctrine which is frequently used by courts which decides to abide by a point of law which was previously held by a court of equal or superior judicial hierarchy. The system of stare decisis purports to promote stability, certainty, reliability, uniformity, convenience and expediency ( Jeffery Commission, Precedent in Investment Treaty Arbitration: A citation Analysis of a Developing Jurisprudence, 24 J. Intl. Arb 132 (2007)).

Some public international law rights have been articulated for the first time in investment treaties – such as the right to “fair and equitable treatment” and a sovereign’s obligation to “obse [...]

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