International Arbitration

On 18 January 2024, Steptoe and the British Institute of International and Comparative Law (BIICL) held a launch event for their joint empirical study on performance requirement prohibitions (PRPs) in international investment agreements (IIAs) (recording and publication available here).

The main focus of this empirical study is PRPs.  PRPs are a distinct type of treaty provisions that appear in many IIAs and that seek to curtail States’ ability to impose performance requirements.

According to UNCTAD, performance requirements are “stipulations, imposed on investors, requiring them to meet certain specified goals with respect to their operations in the host country”.  Performance requirements come in the guise of either: (i) conditions precedent to that State’s authorisation for an investor to make, expand or operate an investment in its territory; or (ii) conditions for an investor receiving a State advantage (e.g., a tax credit, a subsidy or other form incentive).  Some of the most common forms of performance requirements include local content requirements, local sourcing requirements, export performance requirements, import restrictions, export controls/restrictions, and technology transfer, licensing and/or local R&D requirements.Continue Reading Industrial Policy Is Making a Comeback – With Some Investment Treaty Protections Standing in Its Way

On April 28, 2023, the Secretariats of the International Centre for Settlement of Investment Disputes (ICSID) and the United Nations Commission on International Trade Law (UNCITRAL) published the final draft of the Code of Conduct for Arbitrators in International Investment Disputes (the Code of Conduct). The draft concludes nearly six years of heated debates concerning two primary issues: disclosure obligations for arbitrators sitting on investment treaty tribunals; and “double-hatting,” (i.e., where a lawyer sits as arbitrator while at the same time acting as counsel in other investment treaty matters).

The ICSID and UNCITRAL Secretariats developed the Code of Conduct jointly, with substantive efforts led by Working Group III—UNCITRAL’s task force mandated to consider possible reforms to investor-State dispute settlement (ISDS). A separate Code of Conduct for Judges in International Investment Dispute Resolution was also published for judges who would sit on the prospective Multilateral Investment Court proposed by the European Commission.

On March 27-31, 2023, Working Group III finalized its revisions to the Code of Conduct during its forty-fifth session at the United Nations Headquarters in New York City, with representatives of more than ninety-five State delegations and fifty international organizations in attendance. The primary objective of the Code of Conduct is to provide principles and provisions that clarify the duties of international arbitrators—including impartiality, independence, and the conduct of proceedings with integrity, fairness, efficiency, and civility.

The final drafts of both the Code of Conduct for Arbitrators and the Code of Conduct for Judges will now be presented to UNCITRAL for formal adoption during its fifty-sixth annual session in Vienna on July 3-21, 2023.Continue Reading A New Code of Conduct for Arbitrators May Soon Be Available to Parties in Investor-State Disputes—But No Ban on Double-Hatting

Introduction

On April 12, 2023, the High Court of Australia (High Court) rendered a unanimous judgment affirming that a foreign state was not immune from proceedings seeking recognition and enforcement of an International Centre for Settlement of Investment Disputes (ICSID) arbitral award.  This landmark decision provides welcome guidance on the interaction between Australia’s sovereign immunity regime and its international arbitration legislation implementing the ICSID Convention.

Infrastructure Services Luxembourg S.à.r.l. and Energia Termosolar B.V. v. Kingdom of Spain (ICSID Case No. ARB/13/31)

Kingdom of Spain v. Infrastructure Services Luxembourg S.à.r.l. & Anor [2023] HCA 11Continue Reading A Ray of Sunshine for Solar Energy Investors: High Court of Australia Rejects Spain’s Sovereign Immunity Plea Against Recognition and Enforcement of ICSID Arbitral Award