Public Actors in International Investment Law
- Open Access
- 2021
- Open Access
- Book
- 1. edition
- Editor
- Catharine Titi
- Book Series
- European Yearbook of International Economic Law
- Publisher
- Springer International Publishing
About this book
This open access book focuses on public actors with a role in the settlement of investment disputes. Traditional studies on actors in international investment law have tended to concentrate on arbitrators, claimant investors and respondent states. Yet this focus on the “principal” players in investment dispute settlement has allowed a number of other seminal actors to be neglected. This book seeks to redress this imbalance by turning the spotlight on the latter. From the investor’s home state to domestic courts, from sub-national governments to international organisations, and from political risk insurance agencies to legal defence teams in national ministries, the book critically reviews these overlooked public actors in international investment law.
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Table of Contents
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Voices That Shape Investment Treaties: Inside, Outside and Among States
- Open Access
Download PDF-versionThis chapter unveils the complex web of actors that shape investment treaties, categorizing them into voices inside, outside, and among states. It begins by identifying these three broad categories and then delves into each, exploring how actors within governments, businesses, civil society, and international organizations influence treaty negotiations and text. The chapter also highlights the challenges and complexities of balancing these diverse voices in the treaty-making process, providing a unique and detailed overview that sheds light on the intricate dynamics involved in crafting investment treaties.AI Generated
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AbstractInvestment arbitration awards often give the impression that investment treaties are designed to reflect the interests of two actors: “investors” and “states”. There are in fact a myriad of actors, or “voices”, behind each word in an investment agreement. This chapter identifies three broad categories of voices: voices inside, outside and among states. It explores the range of voices that influence investment treaty text by reference to those three categories. The chapter argues that modern investment treaties are multifaceted texts that are influenced by a range of voices from within and outside of government. -
Beyond Protection: The Role of the Home State in Modern Foreign Investment Law
- Open Access
Download PDF-versionThe chapter 'Beyond Protection: The Role of the Home State in Modern Foreign Investment Law' delves into the transformative role of the home state in foreign investment law, tracing its evolution from traditional protection to modern dispute resolution mechanisms. It begins by examining the historical role of the home state in protecting its nationals and their investments, particularly through diplomatic protection and adjudication mechanisms. The chapter then shifts to the contemporary landscape, highlighting the significant shift towards investor-state arbitration and the emancipation of foreign investors. It further explores the emerging responsibilities of the home state, including enhanced collaboration with host states, increased liability for investors, and a more active role in areas such as environmental protection and anti-corruption efforts. The chapter concludes by anticipating a future where the home state plays a more supportive and collaborative role in the investment treaty regime, emphasizing the importance of public interest considerations.AI Generated
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AbstractThe chapter examines the evolution of the role of the home state in foreign investment law. Traditionally, such a role was essentially limited to norm-setting and protecting nationals and national companies abroad. Protection was typically offered through diplomatic protection, which was based on the legal fiction that the state was vindicating its own right. The conclusion of modern investment treaties, the progressive emancipation of foreign investors and the development of investor-state arbitration meant a marginalisation of the home state. Some recent treaties, however, have paved the way for a new role for the home state that goes well beyond protection of its nationals and national companies. Innovative provisions have introduced obligations and responsibilities for the home state, especially with regard to the fight against corruption and the liability of its own investors. It remains to be seen to which extent these provisions will spread across the international community of states. -
National Courts as Actors in Investment Arbitration
- Open Access
Download PDF-versionThe chapter delves into the multifaceted role of national courts in investment arbitration, examining how they influence the process through competition for jurisdiction, facilitation, and obstruction. It discusses the impact of anti-arbitration and anti-suit injunctions, and the crucial role national courts play in enforcing investment awards. The text also explores the challenges and opportunities presented by the increasing involvement of national courts in investment arbitration, offering a nuanced perspective on the evolving relationship between national legal systems and international investment law.AI Generated
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AbstractNational courts are actors in investment arbitration since they influence the functioning of investment arbitration and are themselves in turn influenced by investment arbitration. The influence of national courts on investment arbitration is larger than the influence of other international courts and tribunals, since national law is part of the applicable law in investment arbitration and national courts are authorised to interpret and apply national law. National courts influence investment arbitration by competing for jurisdiction through the exhaustion of local remedies, umbrella clauses, and the fork-in-the-road rule. National courts facilitate investment arbitration by enforcing awards and at the same time disrupt it when rejecting enforcement or issuing anti-arbitration injunctions. Investment tribunals can restrain national courts by issuing anti-suit injunctions. Above all, they can review the decisions of national courts on grounds of denial of justice, fair and equitable treatment, the effective means test, and indirect expropriation. The the relationship between national courts and investment tribunals is such that the later have the last word, although the role of national courts as actors is certainly noteworthy. -
State Immunity and the Execution of Investment Arbitration Awards
A Review of the Plea of State Immunity and the Execution of Investment Arbitration Awards from the Viewpoint of the Forum State- Open Access
Download PDF-versionThis chapter examines the doctrine of state immunity and its application to the enforcement of investment arbitration awards, focusing on the inconsistencies in the rules across different jurisdictions. It discusses the historical evolution from absolute to restrictive immunity and the lack of a unified international regime governing state immunity. The chapter also delves into the specific legislative responses in France and Belgium, including the introduction of express and specific waiver requirements and preliminary judicial authorisation. Additionally, it explores the challenges faced by award-creditors, such as the difficulties in obtaining explicit waivers and the political implications of enforcement proceedings. The chapter concludes by proposing alternatives to enforcement and suggesting ways for investors to navigate the complex landscape of state immunity from execution.AI Generated
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AbstractThe doctrine of state immunity occupies a fundamental place in international law. The application of the doctrine, largely left to the national laws of states, is not consistent. One particular area of inconsistency is the treatment of the plea of state immunity from execution of arbitral awards resulting from investor-state disputes. The issue of state immunity from execution has come to the fore in light of a number of recent attempts by award-creditors to attach their awards against the assets of a foreign state located in jurisdictions considered to be “pro-enforcement”, such as France and Belgium. This chapter considers the plea of state immunity and the execution of investment arbitration awards from the perspective of the forum state. In particular, it addresses the introduction of procedural and substantive amendments to French and Belgian laws on state immunity following these attempts by award-creditors to seize foreign state assets located in their respective jurisdictions. The chapter posits a way forward for investors seeking to navigate the landscape governing state immunity from execution. -
Trends and ISDS Backlash Related to Non-Disputing Treaty Party Submissions
- Open Access
Download PDF-versionThe chapter delves into the evolution and significance of non-disputing treaty party (NDTP) submissions in international investment dispute settlement. It examines how these submissions have been employed by states to intervene in disputes, particularly in the context of the North American Free Trade Agreement (NAFTA). The author discusses the interpretive value of NDTP submissions and the reluctance of arbitral tribunals to accord them significant weight, which has led to the issuance of binding interpretive statements. The chapter also explores the broader implications of this trend, including its role in the current backlash against investor-state dispute settlement (ISDS) and the reforms being undertaken in international investment agreements (IIAs). The analysis is supported by a detailed examination of recent IIA treaty-making practices and the increasing inclusion of NDTP provisions in new agreements. The chapter offers a nuanced perspective on the complex dynamics at play in international investment law and the efforts by states to assert greater control over the interpretive process.AI Generated
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AbstractSome international investment agreements (IIAs) allow states that are parties to a treaty, but are not party to a specific dispute under that treaty, to intervene on a limited basis in order to make submissions on matters of treaty interpretation. Such mechanisms have proved to be highly valued by treaty parties, as evident by the many recently-concluded IIAs containing increasingly sophisticated non-disputing treaty party (NDTP) provisions. This chapter: (1) provides the background on NDTPs mechanisms, with a focus on the North American Free Trade Agreement (NAFTA) (the first-known IIA to contain such a provision); (2) examines the possible connection between tribunals failing to give due regard to treaty parties’ interpretive positions (again focusing on NAFTA) and the current backlash against investor-state dispute settlement (ISDS); and (3) analyses trends in recently-concluded IIAs. It is argued that the apparent lack of deference given by tribunals to NDTP submissions may be contributing to the current backlash against ISDS, based on two discernible trends: (1) an increase in the number of IIAs containing NDTPs provisions; and (2) provisions that now state that not only are treaty interpretations made by treaty parties binding on tribunals (such provisions also have their genesis in NAFTA), but that, in addition, tribunals’ decisions must be consistent with such agreed interpretations (the latter an innovation of a NAFTA party in 2003). Such trends are also visible at the institutional and multilateral levels, such as the revision of the Arbitration Rules of the International Centre for Settlement of Investment Disputes (ICSID) and the Mauritius Convention on Transparency in ISDS of the United Nations Commission on International Trade Law (UNCITRAL), and show no sign of slowing down. -
Not a Third Party: Home State Participation As a Matter of Right in Investment Treaty Arbitration
- Open Access
Download PDF-versionThis chapter delves into the complex issue of home state participation in investment treaty arbitration, highlighting the unique transparency concerns and the right of non-disputing state parties to participate. It examines the historical context of diplomatic protection and its relationship to investor-state dispute settlement, emphasizing the need for transparency in interpreting investment treaties. The chapter also surveys key legal instruments and case studies, showcasing the varying outcomes of non-disputing state party participation and advocating for a standardized approach that grants such participation as a matter of right.AI Generated
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AbstractHost states are not the only sovereign parties that an investment dispute can impact. The sovereign interests of an investor’s home state are also potentially affected by an investment claim initiated by a national against an investment treaty partner, and more mechanisms should be put in place to ensure that the home state has access to the arbitration proceedings. This chapter argues for non-disputing state party participation as a matter of right in investment treaty arbitration cases. Whether or not the home state of the investor is informed of and allowed to participate in an investment dispute has largely been left to the discretion of arbitral tribunals; arbitration rules and jurisprudence have regarded the home state no differently than non-governmental third parties seeking to participate in the arbitration as amici curiae. From the perspective of increased transparency in the investor-state dispute settlement system, this chapter posits that non-disputing state parties must be accorded an elevated status in investor-state arbitration, with the following rights: first, to be formally notified at the outset about an investment treaty dispute; second, to have access to the documents of the arbitration case; and, third, to make written submissions with respect to the interpretation of the international investment agreement invoked in the claim. The analysis begins by identifying the sovereign interests of the home state that come into play in an investment treaty arbitration. The perils of diplomatic protection are examined in this chapter, to provide the perspective from which to delimit the parameters for non-disputing state party participation. A survey of arbitration rules and jurisprudence outlines the level of participation thus far accorded to home states in investment treaty arbitration. -
Investor-State Dispute Prevention: The Perspective of Peru
- Open Access
Download PDF-versionThe chapter delves into the strategies and best practices for preventing investor-state disputes, using Peru as a case study. It highlights the importance of establishing specialized units to manage disputes, the role of cultural differences in dispute resolution, and the benefits of including arbitration provisions in concession contracts. The text emphasizes the need for states to proactively prevent disputes rather than simply managing them, and offers practical recommendations for achieving this goal.AI Generated
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AbstractThis chapter examines state perspectives on investor-state dispute prevention drawing on the author’s personal experience and practice in Peru’s legal defence team. First, it focuses on identifying risks states experience when confronted with investor-state dispute settlement. Next, the chapter turns to particular experiences and general considerations regarding dispute prevention. Finally, it concludes with some recommendations for the implementation of certain dispute prevention practices. -
The Role of Sub-Regional Systems in Shaping International Investment Law-Making: The Case of the Visegrád Group
- Open Access
Download PDF-versionThis chapter delves into the significance of the Visegrád Group (V4) in international investment law-making, highlighting their cooperative efforts in economic and investment promotion both within the EU and with non-EU countries. The V4, comprising the Czech Republic, Slovakia, Hungary, and Poland, has a long-standing tradition of sub-regional cooperation, which has become increasingly relevant in the context of foreign direct investment (FDI). The chapter examines the V4's approach to economic cooperation, investment promotion, and protection, particularly focusing on the complexities surrounding the termination of intra-EU bilateral investment treaties (BITs) post-Lisbon Treaty. It also explores the V4's engagement with non-EU countries, such as Japan, South Korea, and China, through various cooperation frameworks like the V4+ meetings and the 16+1 cooperation with China. The chapter offers a comprehensive analysis of the V4's role in shaping investment law-making, providing valuable insights into their strategies and challenges in the ever-evolving landscape of international investment.AI Generated
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AbstractThe present chapter focuses on the role of the Visegrád group (or V4, comprising Slovakia, Hungary, Poland and the Czech Republic) in international investment law-making. The chapter starts with a brief overview of the V4 group as a sub-regional system in Europe, including its modus operandi and main achievements in the field of economic cooperation. Subsequently, it turns to the regulation of foreign direct investment (FDI), both at the level of each V4 state and at EU level—with particular regard to the implication of the EU’s exclusive competence on FDI. Special attention is paid to the approach of the V4 countries towards the question of termination of intra-EU bilateral investment treaties (BITs)—including an overview of the related objections to jurisdiction that the four countries have raised over the years in investor-state arbitrations based on intra-EU BITs—and to the relationship of the V4 group with non-EU countries—especially with (selected) East Asian countries. The main question is whether—and to what extent—the V4 group as a sub-regional system has a role to play in international investment law-making. The chapter highlights the proactive and advocacy role that the V4 group has traditionally played in manifold subject-matters, including the promotion and protection of FDI, and supports the positive “soft power” the V4 may exercise in this respect. -
The Implications of Political Risk Insurance in the Governance of Energy Projects: Τhe Case of Japan’s Public Insurance Agencies
- Open Access
Download PDF-versionThis chapter examines the crucial role of political risk insurance (PRI) in the governance of energy projects, with a focus on Japan’s public insurance agencies such as NEXI and JBIC. It delves into the complex nature of energy projects and the high political risks they face, highlighting how PRI mechanisms mitigate these risks and influence the behavior of both host governments and foreign investors. The chapter also explores the specific instruments provided by NEXI and the implications of PRI policies on responsible investment considerations. Additionally, it discusses the historical background and market structure of PRI, as well as the criticisms and responses to PRI policies, making it a comprehensive resource for understanding the intricate dynamics of PRI in the energy sector.AI Generated
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AbstractBy purchasing political risk insurance (PRI), investors can successfully strengthen their position in the host state, allocating the burden of political risk to third parties (insurance agencies). PRI is provided by international organisations, such as the Multilateral Investment Guarantee Agency (MIGA) and state-sponsored insurance agencies, known as export credit agencies (ECAs) or public insurance agencies. This chapter focuses on the insurance schemes of NEXI, Japan’s officially sponsored ECA, which plays a dominant role in providing PRI to Japanese nationals. The benefits of insurance agencies providing PRI schemes go beyond cash indemnification. PRI mechanisms include various policy requirements, operational conditions, and performance standards that not only influence the engagement of the insured investors, but also shape the regulatory authority of host governments and affect local communities. PRI plays a particularly crucial role in the governance of energy projects due to the complexity of this sector and its importance to states and local communities. However, there are policy and operational implications of PRI provision in the governance of energy projects with an adverse effect on local communities. In response, most insurance agencies like NEXI, have taken measures for socially and environmentally responsible investments, requiring their insured clients to comply with various social and environmental standards and establishing surveillance mechanisms and in-house grievance facilities. Even if these practices are moving in the right direction, their true functionality and effectiveness have not yet been proved. -
Screening of Foreign Direct Investment and the States’ Security Interests in Light of the OECD, UNCTAD and Other International Guidelines
- Open Access
Download PDF-versionThe chapter delves into the screening of foreign direct investment (FDI) and the security interests of states, highlighting the increasing momentum of these measures since 2010. It examines the role of international organizations like the OECD and UNCTAD in documenting this trend and the various categories of foreign investment, including private investors, sovereign wealth funds, and state-owned enterprises. The text also explores the national and international measures adopted to manage risks associated with FDI, such as the impact of COVID-19 on screening mechanisms. Furthermore, it discusses the limits set by international investment agreements (IIAs) and customary international law on states' ability to invoke national security interests. The chapter concludes by emphasizing the balance between state sovereignty and investor protection, offering insights into the evolving landscape of FDI screening mechanisms.AI Generated
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AbstractThis chapter analyses the concept of the “national security interest”, which is widely recognised as allowing a state to determine which areas of its economy are restricted or prohibited to foreign investors. This chapter seeks to identify what constitutes a threat for a state and how that threat is managed both domestically and internationally. Despite the recognition of a state’s right to take measures it considers essential to its security, there are limits. The rules established by the Organisation for Economic Co-operation and Development (OECD) and the United Nations Conference on Trade and Development (UNCTAD) and other international instruments are non-binding but can serve as a guide for states in determining the limits of the national security approach. International investment agreements can restrict the right of states to take security-related measures. Finally, customary international law, in light of the good faith obligation, can serve as a basis for assessing measures taken by a state and pave the way for a better balance between the rights of a state and those of foreign investors.
- Title
- Public Actors in International Investment Law
- Editor
-
Catharine Titi
- Copyright Year
- 2021
- Publisher
- Springer International Publishing
- Electronic ISBN
- 978-3-030-58916-5
- Print ISBN
- 978-3-030-58915-8
- DOI
- https://doi.org/10.1007/978-3-030-58916-5
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