Applicable Law in Investor-State Arbitration

343 Pages·2013·2.96 MB·English

OXFORD MONOGRAPHS IN
INTERNATIONAL LAW
GeneralEditors
VAUGHAN LOWE QC
EssexCourtChambers,LondonandEmeritusFellow
ofAllSoulsCollege,Oxford
PROFESSOR DAN SAROOSHI
ProfessorofPublicInternationalLaw
attheUniversityofOxford
andSeniorResearchFellowofTheQueen’sCollege,Oxford
STEFAN TALMON
DirectoroftheInstituteofPublicInternationalLaw
attheUniversityofBonnandSupernumeraryFellowofStAnne’sCollege,Oxford
–
Applicable Law in Investor State Arbitration
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Applicable Law in
–
Investor State Arbitration
The Interplay Between National and
International Law
HEGE ELISABETH KJOS
1
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Acknowledgements
‘International investment law is one of the fastest-growing areas of international law
today. Only a decade ago, the current surge in investor–state arbitrations [...] was
beyondimagination.’1ItwasjustabitmorethanadecadeagothatIwasfortunateto
enter the field of international investment arbitration. The rise in the number of
arbitrations and the accompanying growth in scholarship partly explain the time it
hastakentopresentthisstudy.Relatedly,thefactthatIhavebeenexamininga‘moving
target’hasmadetheprocessmorestimulating.Ifeelprivilegedtobeabletocontinueto
workinthisareathatbringstogethersomanyfacetsofthelaw;the‘fieldtrip’2isnot
over.Inthisrespect,Iamespeciallygratefultobepartoftheproject‘InternationalLaw
throughtheNationalPrism:theImpactofJudicialDialogue’fundedbytheEuropean
Science Foundation as a European Collaborative Research Project in the Social Sci-
ences,asithas allowed me toexplore more deeply the larger theme of this book: the
interactionsbetweenthenationalandtheinternationallegalorders.
There are many to thank now that the book is published. In addition to the great
OUP team and then especially the Monograph Series Editors, Merel Alstein and
Anthony Hinton, I mention in particular André Nollkaemper for believing in the
project and for his sharp guidance; the late Thomas W. Wälde, for giving me confi-
denceandinspiration;andSabineSchlemmer-SchulteandRuthTeitelbaumfortheir
direction and friendship. I am also thankful to the distinguished Members of the
DoctoralCommittee3andAntonioParrafortheirvaluablecommentsandsuggestions
tothedoctoralthesiswhichformsthebasisofthisbook;aswellasNwamakaOkany,
YannickRadi,andAnthonyBattah,especially,forourdiscussions.Inadditiontothe
EuropeanScienceFoundation,Igratefullyacknowledgethe(financial)supportofthe
NetherlandsOrganizationforScientificResearch;theHagueAcademyofInternational
Law,CentreforStudiesandResearchinInternationalLawandInternationalRelations;
andtheSchoolofInternationalArbitration,QueenMary,UniversityofLondon.
WarmthanksarealsoduemyfriendsattheUniversityofAmsterdamformakingme
feel at home in the Netherlands and convincing me that I have the world’s best
colleagues.NexttoDanielleObradovic,ThomasVandamme,MartinevanTrigt,Jim
Mathis, Ronald van Ooik, Betty Kremer, Willem van Merle, Annemarieke Vermeer-
Künzli,IngoVenzke,MachikoKanetake,EstherKentinandHeatherKurzbauer;these
includemybrilliantfellowpionieren:GeranneLautenbach,WardFerdinandusse,Jann
Kleffner,NikosLavranos,JanneNijman,andFabiánRaimondo.
Tootherdearfriendsinvariouscornersoftheworld:thankyouforaddingsparkleto
mylife,eachinyourownway.
IwouldliketodedicatethisbooktomyfamilyinNorwayandtheNetherlands,and
thenespeciallytomyhusbandBertil—Icouldnothavewishedforabetterpartnerand
1 S.W.Schill,BookReview,PrinciplesofInternationalInvestmentLaw(2009)20(2)Eur.J.Int’lL.
471(reviewingR.DolzerandC.Schreuer,PrinciplesofInternationalInvestmentLaw[Oxford,Oxford
University Press, 2008]). Cf. A. Diehl, The Core Standards of International Investment Protection
(2012),1(‘Littlemorethanadecadeago,investmentarbitrationwasvirtuallyunknownbeyondthe
circlesofthosewhowereinvolvedinthenegotiationofinvestmenttreaties’).
2 SeeChapter8(concludingobservations).
3 CatharinaBrölmann,FilipDeLy,PieterJanKuijper,AndréNollkaemper,ChristophSchreuer,
NicoSchrijver,OleSpiermann,andErikadeWet.TheHonorableCharlesN.Browerservedinthe
roleofindependentexpert.
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vi Acknowledgements
afatherforourdaughters;tomyMammaandrolemodelKari,foreverything,always;
and to my Pappa, Per-Arne, for giving me perspective and love. Last but not least,
IdedicateittoNoraSofieandKariHelenaformakingmesmileinsideandout,each
andeveryday.Iloveyou.
HegeElisabethKjos,Amstelveen,18September2012
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Table of Contents
TableofCases ix
TableofLegislation xxi
ListofAbbreviations xxviii
1. GeneralIntroduction 1
1. MotivationsfortheStudy 1
2. TheScopeofandTerminologyUsedintheStudy 11
3. TheMethodandPlanoftheStudy 16
2. TerritorializedandInternationalizedArbitrationTribunals 19
1. Introduction 19
2. FeaturesoftheArbitralProcess 20
3. TerritorializedTribunals 23
4. InternationalizedTribunals 44
5. GeneralConclusions 59
3. Choice-of-LawRules 61
1. Introduction 61
2. TheLinkageBetweenLexArbitriandChoice-of-LawMethodology 62
3. Choice-of-LawRules 67
4. GeneralConclusions 103
4. TheScopeoftheArbitrationAgreement:ClaimsandCounterclaims
ofaNationaland/orInternationalNature 105
1. Introduction 105
2. Characterization:TheNationalorInternationalNatureofClaims 106
3. TheScopeoftheArbitrationAgreement:Nationaland/or
InternationalClaims 112
4. CounterclaimsbyHostStates 128
5. GeneralConclusions 154
5. ThePrimaryApplicabilityofNationalLawandtheRoleof
InternationalLaw 157
1. Introduction 157
2. ReasonsforthePrimaryApplicabilityofNationalLaw 158
3. TheRoleofInternationalLawwhenNationalLaw
PrimarilyApplies 181
4. GeneralConclusions 211
6. ThePrimaryApplicabilityofInternationalLawandtheRoleof
NationalLaw 213
1. Introduction 213
2. ReasonsforthePrimaryApplicabilityofInternationalLaw 213
3. TheRoleofNationalLawwhenInternationalLaw
PrimarilyApplies 240
4. GeneralConclusions 269
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viii TableofContents
7. ConcurrentApplicationofandReferencetoNationaland
InternationalLawinCaseofConsistency 271
1. Introduction 271
2. ArbitralPractice 275
3. GeneralConclusions 293
8. ConcludingObservations 295
Index 303
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Table of Cases
ARBITRAL AWARDS
AbaclatandOthers(CaseformerlyknownasGiovannaaBeccaraandOthers)vArgentine
Republic,ICSIDCaseNo.ARB/07/5,DissentingOpinionofProfessorGeorges
Abi-Saab,28October2011 ............................................ 55–6
AbyeiArbitration(GovernmentofSudanvTheSudanPeople’sLiberationMovement/Army),
Award,22July2009 ................................................... 78
ADCAffiliateLimited,ADC&ADMCManagementLimitedvRepublicofHungary,
ICSIDCaseNo.ARB/03/16,Award,2October2006.............166,223,260,265–6
ADFGroupInc.vUnitedStates,ICSIDCaseNo.ARB(AF)/00/1,ProceduralOrderNo.2,
Award,9January2003............................................... 24,31
AdrianoGardellaS.p.A.vRepublicoftheIvoryCoast,ICSIDCaseNo.ARB/74/1,Award,
29August1977...................................................129,288
AESCorporationvTheArgentineRepublic,ICSIDCaseNo.ARB/02/17,Decisionon
Jurisdiction,26April2005...........................................121,241
AESSummitGenerationLimitedandAES-TiszaErömüKft.vHungary,ICSID
CaseNo.ARB/07/22,Award,23September2010............................205–6
AGIPS.p.A.vPeople’sRepublicoftheCongo,ICSIDCaseNo.ARB/77/1,Award,
20November1979 ...........................................71,193,280–1
AguaytiaEnergyLLCvRepublicofPeru,ICSIDCaseNo.ARB/06/13,Award,
11December2008.................................................... 290
AIGCapitalPartners,Inc.andCJSCTemaRealEstateCompanyvRepublicofKazakhstan,
ICSIDCaseNo.ARB/01/6,Award,7October2003........................... 210
AlphaProjektholdingGmbHvUkraine,ICSIDCaseNo.ARB/07/16,Award,
8November2010 .............................................231,239,254
AlsingTradingCo.&SvenskaTändsticksAktiebolagetvGreece,Award,22December1954
(Python,solearb.),23I.L.R.633(1956).................................... 159
AmcoAsiaCorporationandothersvRepublicofIndonesia,ICSIDCaseNo.ARB/81/1,
Award,20November1984;DecisiononAnnulment,16May1986;(resubmittedcase),
DecisiononJurisdiction;Award,5June1990 ............58,84,92,129,152,169,191,
196,209,273,277–8
AmericanBellInternational,Inc.vTheGovernmentoftheIslamicRepublicofIran,
etal.,InterlocutoryAwardNo.ITL41-48-3,11June1984,
6Iran-U.S.C.T.R.74 .....................................69,151,272,291–2
AmericanInternationalGroup,Inc.andAmericanLifeInsuranceCompanyvIslamicRepublic
ofIranandCentralInsuranceofIran,Award,19December1983...............187,234
Amman&WhitneyandMinistryofHousingandUrbanDevelopment(Khuzestan
DepartmentofHousingandUrbanDevelopment),CaseNo.198,ChamberOne,
Order,30January1984................................................. 51
AmocoInternationalFinanceCorporationvIranetal.,PartialAwardNo.310-56-3
(14July1987)....................................................161,234
Anaconda-Iran,Inc.vGovernmentoftheIslamicRepublicofIranandNationalIranian
CopperIndustriesCompany,CaseNo.167,AwardNo.ITL65-167-3,Interlocutory
Award,10December1986,13Iran-U.S.C.T.R.199................. 48,51–2,69,94,
147,167,175–6,263–4
Andersonetal.vRepublicofCostaRica,ICSIDCaseNo.ARB(AF)/07/3,Award,
19May2010........................................................ 268
AryehvIran,Award,25September1997 ....................................... 235
AsianAgriculturalProductsLimited(AAPL)vDemocraticSocialistRepublicofSriLanka,
ICSIDCaseNo.ARB/87/3,Award,27June1990,4ICSIDRep.246(1997).... 78–9,186,
223–4,227,259,263
AtlanticTritonCompanyLimitedvPeople’sRevolutionaryRepublicofGuinea,ICSID
CaseNo.ARB/84/1,Award,21April1986...............................129,180
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