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A Question of Democracy: The German Debate on International Investment Law.

Germany’s position on international investment law and investor-State arbitration is attracting increasing attention since the signing of the Canada-EU Comprehensive Economic and Trade Agreement (CETA) in September 2014 has been deferred, inter alia, because of opposition from Sigmar Gabriel, Germany’s Federal Minister for Economic Affairs and Energy. Is Germany, the country that not only has concluded the first bilateral investment treaty (BIT) in 1959 but also has the densest network of BITs worldwide, as some fear, joining the coalition of critics in fundamentally reversing its international investment policy?

Mounting Criticism of International Investment Law in Germany in Context

A [...]

Effects of Settlements in Investor-State arbitration

What are the effects of a settlement agreement between the locally incorporated company and the host state on the foreign shareholder’s pending BIT claim? Two views have emerged under investment treaty arbitration case law. The first view, adopted in Sempra v. Argentina (ICSID Case No. ARB/02/16) and Hochtief v. Argentina (ICSID Case No. ARB/07/31) decisions, holds that a settlement agreement does not prevent the shareholder from pursuing international proceedings against the State. The second view, sustained in SAUR v. Argentina (ICSID Case No. ARB/04/4), contends that the effects of a settlement agreement preclude the investor from proceeding with an international action against the Sta [...]

Domestic Public Law: a Useful Critique for Understanding and Developing Investment Treaty Arbitration?

A recent seminar delivered under the Chatham House Rule considered the usefulness of an analogy between Investment Treaty Arbitration (ITA) and domestic public law, with a view to critiquing perceived imbalances in the former. The content of the seminar was grounded in the speaker’s background in ITA and public law litigation including domestic judicial review (JR) and European human rights law.  This post summarises the speaker’s comments.

The speaker’s main comments may be summarised as follows: ITA, whilst not simply another species of public law, does, like domestic JR, allow individuals to directly challenge governments and receive a remedy. Although it is not directly comparable [...]

EU Law and Investment Law: Two Worlds Apart?

The Inaugural Conference of the European Federation for Investment Law and Arbitration (EFILA) took place on Friday, 23 January 2015, in the Senate House of the Queen Mary University of London. 160 participants ranging from academics, arbitrators, arbitration institutions, companies, lawyers to NGOs reviewed a full day long the EU’s first 5 years of European investment policy.

The conference was kicked off by the first panel which immediately dived into the fundamentals, namely, the pros and cons of the existing investor-state dispute settlement system (ISDS). The range of the critique was broad spanning from essentially leaving it to arbitral tribunals to find the right balance, over possi [...]

Are a Bilateral Investment Treaty Arbitration and a Proceeding Before the European Court of Human Rights Compatible?

Although a bilateral investment treaty (“BIT”) arbitration and an application made before the European Court of Human Rights (“the Court”) could, at first glance, present opposite objectives, investors alleging a violation of their rights by a State may be inclined to make use of both remedies. As it will be elaborated below, the case law shows that a strict application of the triple identity test (i.e. same parties, same facts, same cause of action) by the arbitral tribunals and the Court generally entails the rejection of lis pendens or admissibility objections based on BITs’ “fork in the road” provisions or Article 35, §2, b) of the Convention, which provides that the Court [...]

“Investment Arbitration Is Now On Broadway, And The Critics Are Not Being Kind”

That was the assessment of Constantine Partasides QC, founding partner of Three Crowns, during his keynote address to the joint ITA-IEL conference. According to Mr. Partasides, there is a developing consensus among states that it is acceptable, and even virtuous, to challenge investor-state arbitration as an infringement on the rights of the public to pass laws through their democratically-elected representatives. Thus it has become de rigueur for a sovereign to challenge and obstruct the arbitral process, through challenges to the appointed arbitrators, jurisdictional objections, and post-award challenges to awards and their enforcement. Resistance to investor-state arbitration is increa [...]

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