Current Trends in Investment Law & Arbitration

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1 Current Trends in Investment Law & Arbitration 5 th Meeting of the Asia-Pacific Foreign Direct Investment Network Meg Kinnear, ICSID Secretary-General November 2, 205

2 Negotiating the ICSID Convention

3 Impartial and delocalized facility Secretariat expertise Cost-effective fee structure Access to facilities internationally Transparency Features of ICSID Only institution that can administer ISDS under the three main set of rules (ICSID Convention, Additional Facility and UNCITRAL) 3

4 ICSID Today 5 Members 4

5 UNCTAD ISDS Caseload Source: UNCTAD, World Investment Report 205 5

6 FY972 FY973 FY974 FY975 FY976 FY977 FY978 FY979 FY980 FY98 FY982 FY983 FY984 FY985 FY986 FY987 FY988 FY989 FY990 FY99 FY992 FY993 FY994 FY995 FY996 FY997 FY998 FY999 FY2000 FY200 FY2002 FY2003 FY2004 FY2005 FY2006 FY2007 FY2008 FY2009 FY200 FY20 FY202 FY203 FY204 FY205 ICSID Caseload (By Fiscal Year) Cases Registered under the ICSID Convention and Additional Facility Rules by Fiscal Year 6

7 UNCITRAL Cases at ICSID FY2006 FY2007 FY2008 FY2009 FY200 FY20 FY202 FY203 FY204 FY205 Investor-State UNCITRAL Arbitrations Other Cases 7

8 Increase in Global FDI Source: UNCTAD, FDI/MNE database ( 8

9 More Investment Treaties Source: UNCTAD, IIA database 9

10 Source of Consent Canada-Peru Free Trade Agreement (Canada-Peru FTA) 2% Central America-Panama Free Trade Agreement 2% Energy Charter Treaty (ECT) 22% Bilateral Investment Treaty (BIT) 5% North American Free Trade Agreement (NAFTA) 2% Investment Law of the Host- State 2% Investment Contract between the Investor and the Host-State 8% Dominican Republic-United States-Central America Free Trade Agreement (DR- CAFTA) % 0

11 Trend to Regional Treaty-Making Failed MAI in 998; failed FTAA in mid 2000 s Renewed interest in treaty-making on a regional basis EU Lisbon Treaty EU-Singapore; EU-Canada; other negotiations, including US & China TPP Pacific Alliance ASEAN Comprehensive Investment Agreement 202 RCEP

12 Geographic Distribution by State Party June 30, 205 Central America & the Caribbean 7% North America (Canada, Mexico & U.S.) 4% Eastern Europe & Central Asia 25% Western Europe 5% South America 25% Sub-Saharan Africa 6% South & East Asia & the Pacific 8% Middle East & North Africa 0% 2

13 ICSID Cases by State Party Albania, 2 Bulgaria, Croatia, Estonia, Hungary, Kazakhstan, 2 Greece, Burundi, Kosovo, Cabo Verde, Romania, 2 Cameroon, Guinea, Serbia, Spain, 0 Kenya, Slovak Republic, Mauritania, Turkey, 2 Mozambique, Jordan, 2 China, Senegal, 2 Indonesia, Dominican Republic, Ukraine, 2 Lebanon, Korea, Panama, 2 Argentina, Eastern Europe & Central Asia Western Europe Uganda, Yemen, Timor-Leste, Peru, Canada, Sub-Saharan Africa Middle East & North Africa South & East Asia & the Pacific Central America & the Caribbean South America North America (Canada, Mexico & U.S.) 3

14 Outcomes of Tribunal Awards June 30, 205 Award declining jurisdiction 25% Award dismissing all claims 29% Award deciding that the claims are manifestly without legal merit* % Award upholding claims in part or in full 45% 4

15 New Scope for Investment Treaties Broad State consensus that investment treaties should be maintained, but refined to enhance: Cost-benefit and linkage to domestic economic goals Predictability 5

16 Revised Approaches to Drafting Definition of investor/investment Direct and indirect expropriation Fair and Equitable Treatment Most Favoured Nation Treatment Umbrella Clauses Exceptions to ensure regulatory space Denial of Benefit Clauses 6

17 Revised Approaches to Procedure Increased pre-conditions to access: waiver, exhaustion, limitations, etc. Frivolous Claims Role of States Codes of Conduct for Arbitrators & Counsel Mediation 7

18 3 Aspects: Transparency Access to Documents Access to Process Amicus ICSID Rules 2006 Mauritius Convention 204 See ICSID Website 8

19 Arbitrators North America (Canada, Mexico & U.S.) South America Central America & the Caribbean Middle East & North Africa Sub-Saharan Africa South & East Asia & the Pacific Eastern Europe & Central Asia Western Europe Appointments by ICSID Appointments by the Parties (or Party-appointed Arbitrators) 9

20 Questions of Access Use by individuals and SMEs Mass/Class Claims Potential for Small Claims capacity? Issues Concerning Third-Party Funding 20

21 Other Discussions Appellate Body proposal Party appointment v. Institutional appointment v. Standing court Remedies Extending Reciprocity of Obligations Corporate Social Responsibility Role of REIO in Arbitration 2

22 ICSID 88 H Street, N.W. Washington, D.C Tel: (202) Fax: (202)

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