Jump to Content Jump to Main Navigation

Creating Conduits

Creating Conduits

Summary Report of the First Annual Oxford Investment Claims Summer Academy, St. Anne’s College (Oxford)
Diane Desierto, Ian Laird & Frédéric Sourgens (co-chairs)

This July 13-14, Oxford University Press and Investment Claims convened the First Annual Oxford Investment Claims Summer Academy at St. Anne’s College Oxford.  Co-chaired by Diane Desierto, Ian Laird, and Frédéric Sourgens, the Academy brought together a select expert group of academic and practitioner delegates to discuss the legitimacy of investor–state arbitration in the context of continuous and often virulent political criticism. The method and structure of the Academy departed from a traditional presentation format. Instead, the Academy as the first gathering of experts of its kind acted as a laboratory for open and rapid discussion of frontier issues among all participants. As a result of this format, the Academy constructively explored both traditional text-based and context-sensitive solutions for these frontier issues. Judge James Crawford’s keynote address to the delegates aptly captured the spirit of the open and critical discussion when noting that while there is little in the way of feasible alternatives to investor–state arbitration and much to lose by its abolition, bench, bar, and ivory tower must find it in them to become better stewards of this mode of international dispute resolution. In particular, there is an urgent need to address weaknesses made visible by the first two decades of sustained arbitral and annulment jurisprudence. Given the quality of engagement at St. Anne’s, the co-chairs are planning to hold the Academy again in the summer of 2016.

The Academy was divided over two days into five panels and three research discussions. The panels addressed the nature of consent in investor–state arbitration, concerns relating to the impartiality of investor–state tribunals, the nature of applicable law in investor–state arbitration, and the handling of evidence by investor-state tribunals. The research discussions engaged with the appropriate use of human rights and public policy in international economic law and the evolution of treaty interpretation in investor–state arbitration. The Academy closed with a summary panel addressing whether, as Senator Elizabeth Warren charged, investor–state tribunals are in fact “rigged pseudo-courts”.

The first panel addressed the nature of consent to investor–state arbitration and the consequent timing and nature of vesting of investor rights. The panel thus asked whether states consenting to investor–state arbitration remained at liberty to alter their bargains pursuant to traditional rules of the Vienna Convention on the Law of Treaties or whether reasonable investor reliance could frustrate such attempts. It discussed various alternative conceptions of consent and vesting from delegated authority theories to third-party beneficiary accounts to a unilateral act approach. The discussion addressed the repercussions of these theories for proposals currently being debated in the European Union as to whether to use traditional treaty rules to modify and terminate certain investment treaties. The session was moderated by Dr. Borzu Sabahi of Curtis Mallet-Prevost Colt & Mosle LLP, Adjunct Professor of Law at Georgetown University Law Center, and animated by discussion leaders Prof. Andrea Bjorklund, the Fortier Chair in International Arbitration & International Commercial Law at the McGill University Faculty of Law, and Prof. Frédéric Sourgens of Washburn University School of Law.

The Academy next considered the chapters immediately relevant to investment treaties from Dr. Diane Desierto’s Public Policy in International Economic Law: The ICSCR in Trade, Finance, and Investment (OUP, 2015). The session amply elucidated the role of, and considered accounts for, human rights obligations in framing public policy questions in the application of investment treaties. It importantly pointed to the need for expanding the cognitive horizon of both academics and practitioners beyond seeing investment treaties, and their relationship to human rights conventions, as purely dispute-driven instruments and instead to utilize them in informing procurement and investment-design decisions. The discussion was led by the author, with discussant Prof. Dr. Freya Baetens, Director of Studies at Leiden University College and Head of the LUC Research Centre at Leiden University.   

The second panel addressed the perception of bias in investor–state arbitration. It asked whether accusations of systemic bias from the arbitral bench were well founded and what, if any, corrective measures would be feasible. The discussion concluded that while there were certain systemic issues arising from multiple repeat appointments of arbitrators, these issues evidenced path dependence of counsel and parties in international arbitration rather than bias of international arbitrators. The panel further considered that any institutionalization of investor–state dispute resolution in a court or appellate mechanism would exacerbate rather than alleviate current problems and do little to increase the diversity—in both origin and outlook—of the investor–state bench. The session was moderated by Ian Laird of Crowell & Moring LLP, Adjunct Professor at Columbia Law School and Georgetown University Law Center, and brilliantly led by Dr. Martins Paparinskis of University College London and Meriam Al Rashid of Pinsent Masons.  

The third panel addressed the question whether the law applicable to investor–state disputes should be considered functionally as a form of international public law. During the panel, delegates discussed in particular the implications of applying the rules of state responsibility and the law of treaties to disputes involving non-state actors as parties. The panel also discussed ongoing efforts at codifying a lex mercatoria publica and the likely impact upon investor-state arbitration. The panel was moderated by Dr. Desierto and inspiringly guided by independent arbitrator and counsel Dr. Todd Weiler and Dr. José Antonio Rivas of Arnold & Porter LLP, Adjunct Professor of Law at Georgetown University Law Center.  

The fourth panel focused on the treatment of evidence by investor–state tribunals. It addressed the extent to which there were limitations on the free use of evidence by international tribunals. It focused particularly upon the evidentiary issues in the context of corruption allegations, discussing relevant means, standards, and burdens of proof. The panel further addressed the potential of legitimacy issues arising out of poorly reasoned awards, particularly in the context of allegations of corruption. The panel was moderated by Prof. Sourgens and expertly led by Prof. Kaj Hobér, Professor of International Investment and Trade Law at Uppsala University, and Teddy Baldwin of Baker & McKenzie LLP.  

The Academy next welcomed Prof. Richard Gardiner of University College London to discuss the second edition of the highly influential Treaty Interpretation (OUP, 2015). The discussion, led by Ian Laird and Prof. Gardiner, provided a detailed appraisal of the strengths and weaknesses of investor–state tribunals in applying classic principles of treaty interpretation in the investor–state context. Part of this session will shortly be available for view on www.investmentclaims.com.

The Academy closed with an appraisal of whether Senator Elizabeth Warren’s accusation that BIT tribunals were little more than “rigged pseudo-courts” had merit, in light of the Academy proceedings focusing on critical jurisdictional, procedural, and merits issues. It explored the political context of increased radicalization on both sides of the Atlantic as one cause of the criticism. It pointed out that much of the criticism had an idealized view of domestic governance structures in transitional economies — and even too rosy a view of governance structures in many advanced economies. The panel noted that the acerbic criticism levelled at investor-state arbitration was not in the least anomalous when compared to other international dispute resolution bodies. The Academy thus concluded that views regarding international dispute resolution, as such, had taken a decidedly negative turn since its heyday in the immediately post Cold-War era. But with the increased need for international dispute resolution in the investor–state realm and beyond, these currently popular parochial views seemed to many of the delegates worthwhile contesting. The session was moderated by Prof. Bjorklund and thought-provokingly led by Michael Nolan of Milbank, Tweed, Hadley & McCloy LLP, Adjunct Professor of Law at Georgetown University Law Center, and Dr. Desierto.

The Academy delegates were H.E. Judge James Crawford (International Court of Justice) (keynote), Dr. Diane Desierto (Hawai’i) (co-chair), Ian Laird (Crowell & Moring LLP) (co-chair), Prof. Frédéric Sourgens (Washburn) (co-chair), Prof. Dapo Akande (Oxford), Meriam Al-Rashid (Pinsent Masons); Prof. Freya Baetens (Leiden), Teddy Baldwin (Baker & McKenzie), Dr. Eirik Bjorge (Oxford), Prof. Andrea Bjorklund (McGill), María Angélica Burgos (Gómez-Pinzón Zuleta), Kabir Duggal (Baker & McKenzie), Dr. Filippo Fontanelli (Edinburgh), Prof. Richard Gardiner (University College London), Prof. Kaj Hobér (Uppsala), Michael Nolan (Milbank, Tweed, Hadley & McCloy LLP), Dr. Martins Paparinskis (University College London), Dr. José Antonio Rivas (Arnold & Porter), Dr. Borzu Sabahi (Curtis, Mallet-Prevost, Colt & Mosle LLP), and Dr. Todd Weiler (independent counsel and arbitrator).