The impact of investment treaties on contracts between host states and foreign investors / by Jan Ole Voss.
2011
K3830 .V67 2011 (Map It)
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Items
Details
Author
Title
The impact of investment treaties on contracts between host states and foreign investors / by Jan Ole Voss.
Published
Leiden ; Boston : Martinus Nijhoff Publishers, 2011.
Call Number
K3830 .V67 2011
ISBN
9789004192232 (hbk. ; alk. paper)
9004192239 (hbk. ; alk. paper)
9004192239 (hbk. ; alk. paper)
Description
xxxviii, 363 pages ; 25 cm.
System Control No.
(OCoLC)671573436
Bibliography, etc. Note
Includes bibliographical references (pages 337-359) and index.
Record Appears in
Table of Contents
Foreword
xv
Acknowledgements
xvii
List of Abbreviations
xix
Table of Cases
xxvii
Introduction
1
From the Protection of Foreign Property to Global Economic Governance
1
Contracts between Host States and Foreign Investors as Instruments of Investment Protection
7
Modern Interrelationship between Treaties and Contracts in Investment Treaty Arbitration
9
Research Methodology and the Structure of the Work
13
1.
Contracts Between Host States and Foreign Investors in the Absence of International Investment Treaties
15
A.
Existence and Characteristics of State Contracts
15
I.
Notion of State Contract and Its Legal Nature
15
II.
Traditional and Modern Forms of State Contracts
17
1.
Traditional Forms
17
2.
Modern Forms
19
a.
Modern Concession Agreements
20
b.
Production Sharing Agreements
21
c.
Management Agreements/Technical Assistance Agreement/Service Contracts
21
d.
Turnkey Contracts
22
e.
Joint Venture Agreements
22
f.
Licensing and Transfer of Technology Agreements
23
g.
Build, Operate and Transfer Agreements (BOT Agreements)
24
III.
Conclusion
24
B.
Theories of Internationalisation
25
I.
Introduction
25
II.
Direct Internationalisation
29
1.
State Contracts as International Law/Per Se Application
29
2.
Genuine Legal Orders
30
3.
Customary International Law and Incorporation of International Law
33
III.
Indirect Internationalisation
34
1.
Origin of the Principle of Party Autonomy
35
2.
Restrictions to the Principle of Party Autonomy
37
a.
Content and General Limitations of the Principle of Party Autonomy
37
b.
Participation of the State as a Sovereign
39
3.
Express Choice of Law by the Parties to the Dispute
41
a.
Choice of a Genuine or Non-National Legal Order
41
b.
Choice of Public International Law
44
c.
Choice of the Host State's Internal Law
47
4.
Implied Choice
48
IV.
Conclusion
50
2.
Regime Established by Investment Treaties
51
A.
Stocktaking: The Worldwide Network of Bilateral and Multilateral Investment Treaties
51
I.
Evolution of the Investment Treaty Network
51
II.
Reasons for the Emergence of Investment Treaties
52
III.
Present Existence of a Worldwide Network of Investment Treaties
54
IV.
Creation of Customary International Law through Investment Treaties
55
B.
Consent to Investment Arbitration in Investment Treaties
57
I.
Three Methods of Establishing Consent in International Investment Arbitration
57
II.
Range of Choices
62
1.
International Centre for the Settlement of Investment Disputes (ICSID)
62
2.
ICSID Additional Facility
63
3.
International Chamber of Commerce (ICC)
64
4.
UNCITRAL/AAA/LCIA/SCC Institute
65
III.
Treaty's Dispute Resolution Clause
65
1.
Scope of the Host State's Consent
65
a.
Unqualified Access to International Arbitration
66
b.
Qualified Access to International Arbitration
66
2.
Scope of a Broadly Phrased Dispute Resolution Clause
68
a.
Arbitral Practice
68
b.
Discussion of the Contradicting Approaches
73
c.
Conclusion
81
C.
Legal Effects of the International Investment Treaty Regime
81
I.
Conferral of Rights upon the Private Individual
81
1.
"Derivative" Model
82
2.
"Direct" Theory
85
3.
Examination of the Contradicting Approaches
87
a.
Wording of the Substantive Provisions
87
b.
Direct Access to International Dispute Settlement
88
c.
Comparison with the Systemic Features of Diplomatic Protection
89
d.
Waiver of Diplomatic Protection
93
e.
Difference between State---State Proceedings and Diplomatic Protection
94
f.
Conclusion
95
II.
Consequences of a Treaty Breach: State Responsibility and the Investment Treaty Regime
95
1.
General System of State Responsibility and Sub-Systems of State Responsibility
96
a.
Consequences of Breach under the General System of State Responsibility
96
b.
Sub-Systems of State Responsibility
97
2.
Investment Treaty Regime as a Sub-System
98
a.
Differences between the Investment Treaty System and the General System
98
b.
Relationship to General Rules of State Responsibility
100
3.
Special Consequences under the Investment Treaty Regime
102
III.
Application of International Law in International Arbitration over Contracts between Host States and Foreign Investors
103
1.
General
103
2.
Application of International Law due to Direct Choice by Treaty
104
a.
Source of the Choice of Law Rule
104
b.
Direct Choice by Treaty
105
3.
Indirect Choice of International Law by Treaties
107
a.
Framework of Arbitral Rules
107
b.
Investment Treaties as International Law
108
4.
Role of Domestic Law
110
a.
Necessity of the Application of Domestic Law
110
b.
Relationship between Domestic Law and International Law
111
c.
Contractual Choice of Domestic Law
114
D.
Notion of "Investment" and Contracts Between Foreign Investor and Host State
115
I.
Specific Regulations concerning Contracts
116
1.
Exclusion of Contractual Contents
117
2.
Limited Protection of Contractual Contents
118
3.
Full Protection of Contractual Contents
119
II.
Contracts and Contractual Contents as "Investment" under the ICSID Convention
124
1.
Substantial Contributions
125
2.
Duration
128
3.
Risk-Assumption/Return of Gains or Profit
131
4.
Significant Contribution to Economic Development
134
5.
Investment Treaties as Lex Specialis
137
III.
Conclusion
138
E.
Investment Treaties and Sub-State Entities as Parties to Contracts
138
I.
Sub-State Entities as Contractual Partner under General International Law
139
1.
General Aspects
139
2.
Attribution of Conduct to the State
140
II.
Investment Treaty Arbitration and Attribution of Conduct of Sub-State Entities
148
1.
Attribution of Conduct under International Law
149
2.
Determination of the Parties to a Contractual Dispute
155
III.
Special Regimes of Attribution of Particular Investment Treaties
156
1.
Articles 22 and 23 of the ECT
157
2.
Article 2(2) of the 2004 US Model BIT
158
IV.
Conclusion
159
3.
Substantive Coverage of Contracts Between Host States and Foreign Investors Through Investment Treaty Standards
160
A.
Distinction between Treaty Claims and Contract Claims
160
I.
Conceptual Distinction
160
II.
Relevance of the Distinctions
162
III.
Evolution of Arbitral Case Law
163
1.
Authoritative Annulment Decision in Vivendi---Analytical Separation and the Principle of Coincidence
163
2.
Prima Facie Approach for Jurisdictional Purposes
167
a.
Competence/Competence of International Arbitral Tribunals
167
b.
Determination of Jurisdiction
168
IV.
Fundamental Differences between Contract Claims and Treaty Claims
173
1.
Nature of Investment Treaties and the Consequent Distinction between International Commercial Arbitration and Investment Arbitration
173
2.
Distinction between Commercial and Governmental Conduct
177
B.
Substantive Protection Standards of Investment Treaties and Their Coverage of State Contracts
179
I.
Expropriation
179
1.
Expropriation under Customary International Law
179
2.
Expropriation of Contracts under Customary International Law
181
3.
Expropriation of Contracts under the Regime of Investment Treaties
187
a.
Coverage of State Contracts
187
b.
Distinction between Breach of Contract and Expropriation
189
c.
Findings of an Expropriation of State Contract
192
d.
Conclusion
196
II.
Fair and Equitable Treatment Standard
197
1.
General Considerations
197
a.
Origins of the Standard
197
b.
Fair and Equitable Treatment and the International Minimum Standard
199
c.
Specifications of the Content
201
2.
Coverage of State Contracts
204
a.
Legitimate Expectations
204
b.
Failure to Provide a Stable Framework for the Investment and Other Violations of the Standard
211
3.
Conclusion
214
III.
Further Standards
215
1.
Non-Discrimination
215
2.
Full Protection and Security
216
IV.
Concluding Remarks
216
1.
Dogma of the Governmental---Commercial Distinction
216
2.
Difference between the Fair and Equitable Treatment Standard and the Non-Expropriation Standard
219
3.
Broad Discretion of Arbitrators
220
4.
Umbrella Clause
221
A.
General Considerations
221
B.
History and Contemporary Use of the Clause
223
I.
Historical Analysis
223
1.
Anglo-Iranian Oil Company
223
2.
Abs-Shawcross Draft Convention on Investments Abroad
225
3.
OECD Draft Convention on the Protection of Foreign Property 1967
227
II.
Contemporary Occurrence and Use of the Clause
228
1.
Occurrence at Present
229
2.
Multilateral Agreements
230
3.
Differences in the Clauses' Wordings
231
a.
Mandatory Language
231
b.
Scope of Obligations
232
c.
Structure
233
d.
Requisitions of the Wording
233
C.
Effect of the Clause
235
I.
Narrow Interpretation or Rejection of an Elevating Effect
235
II.
Elevating Effect
238
III.
Distinction between Commercial and Non-Commercial Conduct
243
D.
Central Controversial Aspects
245
I.
Wording of the Clause
245
1.
Narrow Interpretation
245
2.
Broad Interpretation
247
3.
Conclusion
250
II.
Implications of the Purpose of Investment Treaties
252
1.
In Dubio Mitius
252
2.
Effective Interpretation
254
III.
Consequences of a Broad Interpretation
256
1.
Narrow Approach
256
2.
Middle Approach
259
3.
Broad Approach
261
IV.
Location of the Clause
265
V.
Alternative Functions of the Clause
267
E.
Resolution of Central Aspects
269
I.
Threshold of Elevation
270
II.
Manner of Elevation
273
III.
Contracts Covered
275
5.
Relationship of Parallel Treaty-Based International Arbitral Proceedings and Contract-Based Domestic Court Proceedings in Investment Treaty Disputes
277
A.
Conflicting Jurisdictions under International Investment Treaties and Contracts between a Foreign Investor and a Host State
277
I.
Jurisdictional Conflicts in Investment Treaty Law
278
1.
Generation and Risks of Parallel and Multiple Proceedings
278
2.
Contract-Related Parallel Proceedings: "Asymmetrical" and "Symmetrical" Conflicts
284
3.
Traditional Means of Jurisdictional Conflict Resolution and Their Effect under the Investment Treaty Regime
285
a.
Exhaustion of Local Remedies Rule
286
b.
Principles of Litis Pendens and Res Judicata
288
II.
Treaty Provisions on the Avoidance of Parallel Proceedings
290
1.
"Fork in the Road Clause"
290
2.
Prior Recourse to State Courts for a Fixed Period of Time
293
3.
Alternative Proposals on Jurisdictional Conflict Mitigation
296
a.
Article 1121 of the NAFTA
296
b.
Article 26 of the ICSID Convention
298
c.
Transaction-Based Approaches and Dispute-Based Approache
300
B.
Relationship between International Treaty Proceedings and Domestic Contract Proceedings
301
I.
General Considerations
301
II.
Prevalence of International Tribunals in Asymmetrical Conflicts
303
1.
Superior Status of International Tribunals
303
2.
Primacy or "Independency" of International Investment Tribunals
305
III.
Impact of the Contractual Dispute Resolution Clause on Symmetrical Conflicts
309
1.
Traditional Forms---The Calvo Clause
310
2.
Interpretation in Modern Investment Arbitration
313
3.
Different Views and Their Resolution
320
a.
Waiver of Right to Treaty Protection
320
b.
Effects of a Contractual Dispute Resolution Clause
323
IV.
Conclusion
331
Final Conclusion
332
Bibliography
337
Index
361