James Crawford - GBV Investment Disputes Cases, Materials and Commentary R. Doak Bishop King &...

Foreign Investment Disputes

Cases, Materials and Commentary

R. Doak Bishop

King & Spalding Houston, Texas

James Crawford

Lauterpacht Research Centrefor International Law University of Cambridge

W. Michael Reisman

Yale Law School, New Häven

@1 Wolters Kluwer Law & Business

Table of Contents

Acknowledgements

Chapter 1 Foreign Investment Disputes §1.01 Introduction § 1.02 A Brief Historyof Foreign Investment § 1.03 The International Commitment to Encouraging and Protecting Foreign

Investment §1.04 What is a Foreign Investment Dispute ? §1.05 Investment Treaties § 1.06 International Forums for Resolving Investment Disputes § 1.07 Political Risk Insurance §1.08 Applicable Law §1.09 International Claims §1.10 Procedura and Proof § 1.11 Transparencyandthe Role ofNGOs §1.12 Sovereign Immunity and the Enforcement of State Awards § 1.13 Sources of Information about Foreign Investment Disputes

[A] Selected Websites and Other On line Resources [B] Selected Sources for Locating Gase Law [C] Selected Authoritative Treatises [D] Selected Journals [in alphabetical order]

Chapter 2 Treaty Arrangements for Bilateral Investment Disputes § 2.01 Introduction: Why Treaties Have Been Concluded With Respect to

International Investment [A] Jeswald W. Salacuse, BIT by BIT: The Growth of Bilateral Investment

Treaties and Their Impad on Foreign Investment in Developing Countries, 24 Int'l Law. 655,659-660 (1990)

[B] Comments and Questions § 2.02 Precursors of Modern Investment Treaties

[A] Treaties of Friendship, Commerce and Navigation [1] John F. Coyle, The Treaty of Friendship, Commerce and Navigation in the

ModernEra, 51 Colum.J. Transnat'lL. 302,303-304,319-323 (2013) [2] Kenneth J. Vandevelde, The Bilateral Investment Treaty Program of

the United States, 21 Cornell Int'l L.J. 201,203-208 (1988)

Foreign Investment Disputes - Cases, Materials and Commentary

[3] Comments and Questions 27 [B] Treaty of Friendship, Commerce and Navigation Between the United

States of America and Israel 28 [ 1 ] Treaty of Friendship, Commerce and Navigation Between the

United States of America and Israel (1951), 5 U.S.T. 550 (1954) 28 [2] Comments and Questions 39

§ 2.03 History of Attempts to Create Bilateral Investment Treaties 40 [A] Jeswald W. Salacuse, BIT by BIT: The Growth of Bilateral Investment

Treaties and Their Impact on Foreign Investment in Developing Countries, 24 Int'l Law. 655,655-658 (1990) 40

[B] Alice Hadley, Do Chinas BITs Matter? Assessing the Effect of Chinas Investment Agreements on Foreign Direct Investment Flows, Investors' Rights, and the Rule ofLaw (unpublished paper, Yale Law School 2013) 42

[C] Comments and Questions 44 § 2.04 Modern Investment Treaties 45

[A] Bilateral Treaties 45 [1] Rudolf Dolzer and Margrete Stevens, Bilateral Investment Treaties,

10-11 (Martinas NijhoffPublishers 1995) 45 [2] Kenneth J. Vandevelde, United States Investment Treaties: Policy

and Practice, 19-20 (Kluwer Law International 1992) 46 [3] US Model Bilateral Investment Treaty (2012) 47 [4] German Model Bilateral Investment Treaty (2008) 77 [5] United States- Singapore Free Trade Agreement (2004), Chapter

15: Investment 83 [6] United States-Chile Free Trade Agreement (2005), Chapter 10:

Investment (2005) 100 [7] Comments and Questions 120

[B] Multilateral Treaties 122 [ 1] North American Free Trade Agreement (1992), Chapter Eleven:

Investment (1992) 122 [2] Energy Charter Treaty (1994) 137 [3] Dominican Republic-Central America Free Trade Agreement

(2004), Chapter Ten: Investment 144 [4] ASEAN Comprehensive Investment Agreement (2009) 162 [5] Agreement Among the Government ofjapan, the Government

of the Republic of Korea and the Government of the People s Republic of China for the Promotion, Facilitation and Protection of Investment (2012) 184

§ 2.05 Structure of the Treaties and Obligations Undertaken by States 200 [A] Dispute Resolution 200

[ 1 ] Forums to Which Consent is Given 201 [2] Compania deAguas del Aconquija, S.A. and Compagnie Generale

des Eaux v. Argentine Republic (ICSID Gase No. ARB/97/3), Award of21 November 2000 [Francisco Rezek (pres,), Thomas Buergenthal, Peter D. Trooboff] 201

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[3] Compania deAguas delAconquija, S.A. and Vivendi Universal (formerly Compagnie Generale des Eaux) v. Argentine Republic (ICSID Case No. ARB/97/3), Decision on Annulment of3July 2002 [L.YvesFortier, C.C., QC. (pres.),JamesR. Crawford,Jose Carlos Fernandez Rozas] 202

[B] Convention on the Settlement of Investment Disputes Between States and Nationais of Other States [ICSID or Washington Convention] (1965), 575 U.N.T.S. 159 204

[C] Comments and Questions 209 §2.06 Interpretation of Treaties 210

[A] Vienna Convention on the Law of Treaties (1969) 1155 U.N.T.S. 331 210 [B] Comments and Questions 211

Chapter 3 Investment Contracts and Key Clauses 213 §3.01 Introduction 213 § 3.02 Investment Agreements 215

[A] US Model Bilateral Investment Treaty (2012), Definition of Investment Agreement 215

[B] Case Law 216 [1] Chevron Corp (USA) and Texaco Petroleum Co (USA) v. Republic

of Ecuador (PCA Case No. 34877), Interim Award of 1 December 2008,59-60 [Karl-Heinz Böckstiegel (pres.), Charles N. Brower, Albert Jan van den Berg] 216

[2] Chevron Corp (USA) and Texaco Petroleum Co (USA) v. Republic of Ecuador (PCA Case No. 2009-23), Third Interim Award on Jurisdiction and Admissibility of 27 February 2012, 10-12 [V.V. Veeder (pres.), Horacio Alberto Grigera Naön, Vaughan Lowe] 217

§3.03 Key Investment Contract Clauses 219 [A] Arbitration Clauses 219

[1] Arbitration Clauses 219 [a] Noah Rubins and N. Stephen Kinsella, International

Investment, Political Risk, and Dispute Resolution: A Practitioner's Guide, 43-45,261 (Oceana Publications 2005) 219

[b] R. Doak Bishop, A Practica! Guide For Drafting International Arbitration Clauses, 1 Int'l Energy L. & Tax'n Rev. 16,16,20-23 (2000) 220

[c] Gary B. Born, International Arbitration and Forum Selection Agreements: Drafting and Enforcing, 38 (Kluwer Law International 2010) 221

[2] Examples of Arbitration Clauses 223 [a] ICSID Model Clauses 223 [b] UNCITRAL Model Arbitration Clause 224

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[c] Angola Model Production Sharing Agreement for Deep Water Blocks (February 1992), 141 Basic OilLaws & Concession Contracts: South & Central Africa 1, 84 (2004) 225

[d] UMC Production Sharing Contract Dated 29 June 1992 Between the Republic of Equatorial Guinea & United Meridian International Corp., 135 Basic Oil Laws & Concession Contracts: South & Central Africa 1,55-57 (1998) 225

[3] Comments and Questions 226 [B] Choice-of-Law Clauses 227

[ 1 ] M. Sornarajah, The Settlement of Foreign Investment Disputes, §3.1 at 47-49 (Kluwer Law International 2000) 227

[2] Noah Rubins and N. Stephen Kinsella, International Investment, Political Risk, and Dispute Resolution: A Practitioner's Guide, 47-49 (Oceana Publications 2005) 228

[3] Examples of Choice-of-Law Clauses 230 [a] Trinidadian & Tobagon Model Production Sharing Contract

for Deep Water Areas, HIS Energy, Petroleum, Economics and Policy Solutions (PEPS) Database 230

[b] UMC Production Sharing Contract Dated 29 June 1992 Between the Republic of Equatorial Guinea & United Meridian International Corp., 135 Basic Oil Laws & Concession Contracts: South & Central Africa 1, 59 (1998) 230

[c] Oil Concession Agreement Dated 13 October 1980 Between the Government of Abu Dhabi & Amerada Hess Petroleum Abu Dhabi Ltd., 75 Basic Oil Laws & Concession Contracts: Middle East 5,17 (1982) 230

[d] Pennzoil/Lukoil Group Agreement Dated 10 November 1995 on Production Sharing for the Karabakh and Area Adjacent in the Azerbaijan Sector of the Caspian Sea Between the State Oil Co. of the Azerbaijan Republic (Socar) and Lukoil International, et al., 23 Basic Oil Laws & Concession Contracts Russia & NIS 1,105 (2003) 231

[e] Texaco Exploration Pakistan Petroleum Concession Agreement Dated 6 November 1990 Between the Islamic Republic of Pakistan, Oil & Gas Development Corp., & Texaco Exploration Pakistan Inc., 116 Basic Oil & Concession Contracts: Asia & Australia 2, 97 (1993) 231

[4] Case Law on Choice-of-Law Clauses 231 [5] Comments and Questions 231

[C] Force Majeure Clauses 232 [ 1 ] Karl-Heinz Böckstiegel, Arbitration and State Enterprises: A Survey

on the National and International State ofLaw and Practice, 37-39, 42-48 (Kluwer Law International 1984) 232

[2] Examples of Force Majeure Clauses 237

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[a] Angola Model Production Sharing Agreement For Deep Water Blocks (February 1992), 141 Basic OilLaws & Concession Contracts: South & Central Africa 1,85 (2004) 237

[b] Concession Contract of 31 May 2001 Between the Republic of Cameroon & RSM Production Corp., 157 Basic Oil Laws & Concession Contracts: South & Central Africa 1,34-35 (2004) 237

[c] UMC Production Sharing Contract Dated 29 June 1992 Between the Republic of Equatorial Guinea & United Meridian International Corp., 135 Basic Oil Laws & Concession Contracts: South & Central Africa 1,59-60 (1998) 238

[d] Agip/BP/Etal Production Sharing Agreement Dated 18 November 1997 in respect of the North Caspian Sea (Kashagan) AmongAgip Caspian Sea V.B., et al., 39 Basic Oil Laws & Concession Contracts: Russia & NIS 1,102-104 (2003) 239

[3] Case Law on Force Majeure Clauses 240 [a] National Oil Corp. v. Libyan Sun Oil (ICC Case No. 4462/AS),

First Award of 31 May 1985,291.L.M. 565,568-570,584-600 (1990) [Schmelck (pres.), Koetz, Muskie] 240

[b] Karaha Bodas Company L.L.C. v. Perusahaan Pertambangan Minyak Dan Gas Bumi Negara ('Pertamina') and Pt. PLN (Persero) ('PLN') (ad hoc arbitration under the 1976 UNCITRAL Rules), Final Award of 18 December 2000, 16(3) Mealey's Int'l Arb. Rep. C-2, C-7 to C-8 (2001) [Yves Derains (pres.), Piero Bernardini, Ahmed Sadek El Kosheri] 247

[c] Mobil Cerro Negro, Ltd. v. Petroleos de Venezuela, S.A. and PDVSA Cerro Negro, S.A. (ICC Case No. 15416/JRF/CA), Final Award of 23 December 2011,48-49,64-65,315-316, 323-325 [Karl-Heinz Böckstiegel (pres.), Jacques Sales, Henri C. Alvarez] 248

[4] Comments and Questions 251 [D] Stabilization Clauses 251

[l] Stabilization Clauses 251 [a] Thomas W. Walde and George Ndi, Stabilizing International

Investment Commitments: International Law Versus Contract Interpretation, 31 Tex. Int'l L.J. 215,226-228,260-266 (1996) 251

[b] M. Sornarajah, The Settlementof Foreign Investment Disputes, § 3.2 at 50-51 (Kluwer Law International 2000) 255

[c] Noah Rubins and N. Stephen Kinsella, International Investment, Political Risk, and Dispute Resolution: A Practitioner's Guide, 53-57 (Oceana Publications 2005) 256

[2] Examples of Stabilization Clauses 258 [a] Offshore Agreement Dated 10 January 1978 between

Government of Ghana & Offshore Hydrocarbons Corporation (Later Transferred to Agri-Petco), 58 Basic Oil

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Foreign Investment Disputes — Cases, Materials and Conimentary

Laws & Concession Contracts: South & Central Africa 22, 50-51 (1980) 258

[b] Amoco Group Agreement Dated 14 December 1996 on the Exploration, Development & Production Sharing for Prospective Structures Ashrafi, Dan Ulduzu & Area Adjacent in the Azerbaijan Sector of the Caspian Sea, 24 Basic Oil Laws & Concession Contracts: Russia & NIS 1,91 (1997) 259

[c] Oman Model Exploration & Production Sharing Agreement of2002, Basic Oil Laws & Concession Contracts: Middle East, 45 (2003) 259

[d] Concession Contract of 31 May 2001 Between the Republic of Cameroon & RSM Production Corp., 157 Basic Oil Laws & Concession Contracts: South & Central Africa 1,40 (2004) 259

[3] Case Law on Stabilization Clauses 260 [a] Amoco International Finance Corp. v. Government of the Islamic

Republic oflran (IUSCT Case No. 56), Partial Award No. 310-56-3 of 14July 1987 [Michel Virally (pres.), Charles N. Brower, Parviz Ansari Moin] 260

[b] Libyan American Oil Company (LLAMCO) v. Government of the LibyanArab Republic (ad hoc arbitration under the 1958 ILC Draft Convention on Arbitral Procedure), Award of 12 April 1977, 201.L.M. 1,30-31,55-56 (1981) [Sobhi Mahmassani, sole arbitrator] 263

[c] Phillips Petroleum Company Venezuela Ltd. and ConocoPhillips Petrozuata B.V. v. Petroleos de Venezuela, S.A. (ICC Case No. 16848/JRF/CA (C-16849/JRF/CA), Final Award of 17 September 2012 [Pierre Tercier (pres.), Horacio Alberto Grigera Naön, Ahmed Sadek El Kosheri] 264

[4] Comments and Questions 267 [E] Adaptation & Renegotiation Clauses 267

[ 1 ] Thomas W. Walde and George Ndi, Stabilizing International Investment Commitments: International Law Versus Contract Interpretation, 31 Tex. Int'lL.J. 215,265-266 (1996) 267

[2] M. Sornarajah, The Settlement of Foreign Investment Disputes, § 3.7 at 54-55 (Kluwer Law International 2000) 268

[3] Piero Bernardini, Stabilization and Adaptation in Oil and Gas Investments, 1 (l) J.World Energy Law & Bus. 98,101-105 (2008) 269

[4] Examples of Adaptation and Renegotiation Clauses 271 [a] Restated LNG Development & Production Sharing

Agreement for the North Field Gas Dated 31 January 1993 Between the Government of the State of Qatar and (as Contractor) Qatar General Petroleum Corporation, et al., 58 World LNG Contracts: Qatar 1 (2003) 271

[b] Agip/BP/Etal Production Sharing Agreement Dated 18 November 1997 in respect of the North Caspian Sea

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(Kashagan) Among Agip Caspian Sea V.B., et al., 39 Basic Oil Laws & Concession Contracts: Russia & NIS 1,114 (2003) 271

[5] Case Law on Adaptation Clauses 272 [a] Burlington Resources Inc. v. Republic of Ecuador (ICSID Case

No. ARB/08/5), Decision on Liability of 14 December 2012, 111-113 [Gabrielle Kaufmann-Kohler (pres.), Brigitte Stern, Francisco Orrego Vicuna] 272

[b] Mobil Cerro Negro, Ltd. v. Petroleos de Venezuela, S.A. and PDVSA Cerro Negro, S.A. (ICC Case No. 15416/JRF/CA), Final Award of23 December 2011,48-49,269-271,347-351 [Karl-Heinz Böckstiegel (pres.), Jacques Sales, Henri C. Alvarez] 273

[6] Comments and Questions 277 [F] Waiver of Sovereign Immunity Clauses 277

[ 1 ] Noah Rubins and N. Stephen Kinsella, International Investment, Political Risk, and Dispute Resolution: A Practitioner's Guide, 63-65 (Oceana Publications 2005) 277

[2] Examples of Sovereign Immunity Waiver Clauses 278 [a] Agip/BP/Etal Production Sharing Agreement Dated

18 November 1997 in respect ofthe North Caspian Sea (Kashagan) Among Agip Caspian Sea V.B., et al., 39 Basic Oil Laws & Concession Contracts: Russia & NIS 1,109 (2003) 278

[b] Oman Model Exploration & Production Sharing Agreement of2002, Basic Oil Laws & Concession Contracts: Middle East, 45 (2003) 279

[3] Comments and Questions 279

Chapter 4 Forums for Resolving Foreign Investment Disputes 281 § 4.01 Foreign Investment Arbitration Regimes 281

[A] International Centre for Settlement of Investment Disputes (ICSID) 281 [ 1 ] Background - W. Michael Reisman, Systems ofControl in

International Adjudication and Arbitration: Breakdown andRepair, 46-47 (Duke University Press 1992) 282

[2] Advantages of ICSID Arbitration - Lucy Reed, Jan Paulsson and Nigel Blackaby, Freshfields Guide to ICSID Arbitration, 14-17 (2nd ed., Kluwer Law International 2011) 283

[3] Jurisdiction: ICSID Convention Art. 25 285 [a] The Presence of a Legal Dispute 285

[i] Christoph H. Schreuer, Loretta Malintoppi, August Reinisch and Anthony Sinclair, 7he ICSID Convention: A Commentary, 93-95,98-101 (2nd ed., Cambridge University Press 2009) 285

[ii] UNCTAD, Scope and Definition: A Sequel, Series on Issues on International Investment Agreements II, 46 (United Nations Publications 2011) 288

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[iii] Georgios Petrochilos, Sylvia Noury and Daniel Kalderimis, ICSID Convention, Chapter II, Article 25 [Jurisdiction ofthe Centre], in Concise International Arbitration, 66,67-69 (Loukas A. Misteiis (ed.), Kluwer Law International 2010) 2.88

[iv] Comments and Questions 290 [b] The Presence of a Legal Dispute Arising Directly Out of an

Investment 290 [i] Commentary on the Directness Requirement 290

[aa] Christoph H. Schreuer, Loretta Malintoppi, August Reinisch and Anthony Sinclair, The ICSID Convention: A Commentary, 106 (2nd ed., Cambridge University Press 2009) 290

[bb] Georgios Petrochilos, Sylvia Noury and Daniel Kalderimis, ICSID Convention, Chapter II, Article 2S [Jurisdiction ofthe Centre], in Concise International Arbitration, 66,69 (Loukas A. Misteiis (ed.), Kluwer Law International 2010) 291

[ii] Commentary on the Investment Requirement 291 [aa] Christoph H. Schreuer, Loretta Malintoppi,

August Reinisch and Anthony Sinclair, The ICSID Convention: A Commentary, 114-117,125-128 (2nd ed., Cambridge University Press 2009) 291

[bb] Campbell McLachlan, Laurence Shore and Matthew Weiniger, International Investment Arbitration: Substantive Principles, 164 (Oxford University Press 2007) 293

[cc] Georgios Petrochilos, Sylvia Noury and Daniel Kalderimis, ICSID Convention, Chapter II, Article 25 [Jurisdiction ofthe Centre], in Concise International Arbitration, 66,69-70 (Loukas A. Misteiis (ed.), Kluwer Law International 2010) 294

[iii] Definitions in International Investment Agreements 295 [aa] US Model Bilateral Investment Treaty (2012) 295 [bb] UNCTAD, Scope and Definition: A Sequel, Series on

Issues on International Investment Agreements II, 21 -48 (United Nations Publications 2011) 295

[iv] Definitions in Local Foreign Investment Law 302 [aa] Tradex Hellas S.A. v. Republic ofAlbania (ICSID

Case No. ARB/94/2), Decision on Jurisdiction of 24 December 1996 [Karl-Heinz Böckstiegel (pres.), Fred Fielding, Andrea Giardina] 302

[bb] Zhinvali Development Ltd. v. Republic of Georgia (ICSID Case No. ARB/00/1), unreported, as commented on in Walid Ben Hamida, The Mihaly

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v. Sri Lanka Case: Some Thoughts Relating to the Status ofPre-InvestmentExpenditures, in International Investment Law and Arbitration: Leading Casesfrom the ICSID, NAFTA, Bilateral Treaties and Customary International Law, 47, 67-70 (Todd Weiler ed., Cameron May 2005) 302

[v] Cases 304 [aa] Malaysian Historical Salvors, SDN, BHD v.

The Government of Malaysia (ICSID Case No. ARB/05/10), Award on Jurisdiction of 17 May 2007 [Michael Hwang, S.C. (sole arbitrator)] and Decision on the Application for Annulment of 16 April 2009 [Stephen M. Schwebel (pres.), Mohamed Shahabuddeen, Peter Tomka] 304

[bb] Abaclat and Others v. Argentine Republic (formerly Giovanna A. Beccara and Others v. The Argentine Republic) (ICSID Case No. ARB/07/5), Decision on Jurisdiction and Admissibility of 4 August 2011 [Pierre Tercier (pres.), Georges Abi-Saab, Albert Jan van den Berg] 312

[cc] Biwater Gauff (Tanzania) Ltd., v. United Republic ofTanzania (ICSID Case No. ARB/05/22), Award of24JuIy 2008 [Bernard Hanotiau (pres.), Gary B. Born, Toby Landau] and Concurring and Dissenting Opinion of 18 July 2008 [Gary B. Born] 317

[dd] Comments and Questions 319 [c] Parties 320

[i] Contracting State or Constituent Subdivision or Agency 320 [aa] Georgios Petrochilos, Sylvia Noury and Daniel

Kalderimis, ICSID Convention, Chapter II, Article 25 [Jurisdiction ofthe Centre], in Concise International Arbitration, 66,70-71 (Loukas A. Misteiis (ed.), Kluwer Law International 2010) 320

[bb] Cable Television ofNevis, Ltd. and Cable Television ofNevis Holdings, Ltd. v. Federation ofSt. Kitts and Nevis (ICSID Case No. ARB/95/2), Decision on Jurisdiction of 13 January 1997 [Woodbine A. Davis (pres.), Arthur A. Maynard, Rex McKay] 321

[ii] National of Another Contracting State 324 [aa] Campbell McLachlan, Laurence Shore and

Matthew Weiniger, International Investment Arbitration: Substantive Principles, 131-133 (Oxford University Press 2007) 324

[bb] Jeswald W. Salacuse, The Law of Investment Treaties, 186-189 (Oxford University Press 2010) 325

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[cc] Hussein Nuaman Soufraki v. The United Arab Emirates (ICSID Case No. ARB/02/7), Award of 7July2004 [L.Yves Fortier (pres.), StephenM. Schwebel, Aktham El Kholy] 327

[dd] Tokios Tokeles v. Ukraine (ICSID Case No. ARB/02/18), Decision on Jurisdiction of 29 April 2004 [Prosper Weil (pres.), Piero Bernardini, Daniel M. Price] 331

[ee] TSA Spectrum de Argentina S.A. v. Argentine Republic (ICSID Case No. ARB/05/5), Award of 19 December 2008 [Hans Danelius (pres.), Georges Abi-Saab, Grant D. Aldonas] 337

[ff] Comments and Questions 340 [d] Consent 341

[i] Georgios Petrochilos, Sylvia Noury and Daniel Kalderimis, ICSID Convention, Chapter II, Article 25 [Jurisdiction ofthe Centre], in Concise International Arbitration, 66, 74-77 (Loukas A. Misteiis (ed.), Kluwer Law International 2010) 341

[ii] Standard Chartered Bank v. United Republic of Tanzania (ICSID Case No. ARB/10/12), Award of 2 November 2012 [William W. Park (pres.), Barton Legum, Michael C. Pryles] 343

[iii] Daimler Financial Services AG v. Argentine Republic (ICSID Case No. ARB/05/01), Award of 22 August 2012 [Pierre-Marie Dupuy (pres.), Charles N. Brower, Domingo Bello Janeiro] and Dissenting Opinion of 15 August 2012 [Charles N. Brower] 345

[iv] Comments and Questions 347 [4] Annulment Proceedings 348

[a] W. Michael Reisman, Systems ofControl in International Adjudication and Arbitration: Breakdown and Repair, 48,50 (Duke University Press 1992) 348

[b] Lucy Reed, Jan Paulsson and Nigel Blackaby, Freshfields Guide to ICSID Arbitration, 162-174 (2nd ed., Kluwer Law International 2011) 349

[c] Comments and Questions 355 [B] International Centre for Settlement of Investment Disputes (ICSID)

Additional Facility 355 [ 1 ] Andrew Newcombe and Lluis Paradell, Law and Practice of

Investment Treaties: Standards ofTreatment, 29 (Kluwer Law International 2009) 355

[2] Lucy Reed, Jan Paulsson and Nigel Blackaby, Freshfields Guide to ICSID Arbitration, 17-19 (2nd ed., Kluwer Law International 2011) 355

[C] Iran U.S. Claims Tribunal (Algiers Accords) 357

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[ l] David D. Caron, Lee M. Caplan and Matti Pellonpää, The UNCITRAL Arbitration Rules: A Commentary, 3-8 (Oxford University Press 2006) 357

[2] David D. Caron, The Iran-U.S. Claims Tribunal and Investment Arbitration: Understandingthe Claims SettlementDeclaration as a Retrospective BIT, in The Iran-U.S. Claims Tribunal at 25: The Cases Everyone Needs to Knowfor Investor-State and International Arbitration, 378-383 (Christopher R. Drahozal and Christopher S. Gibson (eds), Oxford University Press 2007) 360

§4.02 OtherArbitral Regimes 363 [A] Permanent Court of Arbitration (PCA) 363

[1] PCA, 11 Ith AnnualReport: 2011,2,3,6,8 (2012) 363 [2] UN CTAD, Dispute Settlement: Permanent Court of Arbitration,

32-33 (United Nations Publications 2003) 365 [B] International Court of Arbitration of the International Chamber of

Commerce (ICC) 366 [ 1 ] ICC, ICC Dispute Resolution: A World ofExperience - A Wealth of

Expertise, 2-5 (2012) 366 [2] Jacob Grierson and Annet van Hooft, Arbitrating Under the

2012 ICC Rules: An Introductory Users Guide, 30 (Kluwer Law International 2012) 368

[3] ICC, ICC Commission Report: States, State Entities and ICC Arbitration, 2 (2012) 369

[C] London Court of International Arbitration (LCIA) 370 [ l] Simon Nesbitt, LCIA Rules [Introductory Remarks], in Concise

International Arbitration, 401 (Loukas A. Misteiis ed., Kluwer Law International 2010) 370

[2] Peter Turner and Reza Mohtashami, A Guide to the LCIA Arbitration Rules, 2-3 (Oxford University Press 2009) 371

[D] Arbitration Institute of the Stockholm Chamber of Commerce (SCC) 372 [ l] Gary B. Born, International Arbitration and Forum Selection

Agreements: Drafting and Enforcing, 56 (3rd ed., Kluwer Law International 2010) 372

[2] The SCC Experience of Investment Arbitration under UNCITRAL Rules, Paper presented by Annette Magnusson, SCC Secretary General, in October 2012 372

[E] United Nations Commission on International Trade Law (UNCITRAL) Arbitration Rules 374 [1] UNCITRAL, Recommendations to Assist Arbitral Institutions

and Other Interested Bodies With Regard to Arbitration Under the UNCITRAL Arbitration Rules (asRevised in 2010) (2012) 374

[2] David D. Caron, Lee M. Caplan, The UNCITRAL Arbitration Rules: A Commentary, 7-8 (2nd ed., Oxford University Press 2013) 375

§ 4.03 International Courts 375 [A] Permanent Court of International Justice (PCIj) 375

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[ 1 ] UNCTAD, Dispute Settlement: International Court of Justice, 5 (United Nations Publications 2003) 375

[2] Stephan W. Schill, Private Enforcement of International Investment Law: Why We Need Investor Standing in BIT Dispute Settlement, in The Backlash Against Investment Arbitration: Perceptions and Reality, 29,37-39 (Michael Waibel, Asha Kaushal, Kyo-Hwa Liz Chung and Ciaire Balchin (eds), Kluwer Law International 2010) 376

[B] International Court of Justice (ICJ) 377 [ 1 ] UNCTAD, Dispute Settlement: International Court of Justice, 5

(United Nations Publications 2003) 377 [2] Andrew Newcombe and Lluis Paradell, Law and Practice of

Investment Treaties: Standards ofTreatment, 35-39 (Kluwer Law International 2009) 378

[C] Other International Courts 380 § 4.04 National Forums 380

[A] General Considerations 380 [B] Comments and Questions 380

Chapter 5 Political Risk Insurance 381 §5.01 Introduction 381 § 5.02 Multilateral Investment Guarantee Agency (MIGA) 382

[A] Convention Establishing the Multilateral Investment Guarantee Agency (198S), 1S08 U.N.T.S. 99 (1985) 382

[B] Commentary on the Convention Establishing the Multilateral Investment Guarantee Agency, 1 ICSID Rev. - Foreign Inv. L.J. 193,195-202 (1986) 384

[C] Comments and Questions 386 § 5.03 National Programs - U.S. Overseas Private Investment Corporation (OPIC) 386

[A] OPIC Program Handbook, 1 -21 (OPIC 2007) 386 [B] OPIC Enabling Statute, 22 U.S.C. § 2191-2200 (1969) 389 [C] OPIC Agreements with Foreign Governments 391

[1] Model OPIC Investment Incentive Agreement, 1 B.D.I.E.L. 669 (1994) 391

[2] Robert C. O'Sullivan, Model OPIC Investment Incentive Agreement, 1 B.D.I.E.L. 665 (1994) 393

[D] Comments and Questions 394 § 5.04 OPIC Claims 394

[A] Expropriation Claims 394 [1] Governmental Nexus 394

[a] Otis Elevator Co. (Iran: 1982), OPIC Memorandum of Determinations: Expropriation Claim of Otis Elevator Company - Contract of Insurance No. 8982R - of 8 November 1982 394

[2] Repudiation of Contract 393

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[a] Ponderosa Assets, L.P. (Argentina: 2005), OPIC Memorandum of Determinations: Expropriation Claim of Ponderosa Assets, L.P. - Contract of Insurance No. 733 - of 2 August 2005,1,5,7-14,19 398

[3] Creeping Expropriation 402 [a] Revere Copper & Brass, Inc. v. OPIC (AAA Case No. 1610

0137 76), Award of 24 August 1978,17I.L.M. 1321,1329-1332,1338,1340,1342-1343,1347-1351,1353 (1978) 402

[b] MidAmerican Energy Holdings Company (formerly CalEnergy Company, Inc.) (Indonesia: 1999), OPIC Memorandum of Determinations: Expropriation Claim of MidAmerican Energy Holdings Company (formerly CalEnergy Company, Inc.) - Contracts of Insurance Nos. E374, E453, E527, and E759 - of November 1999,1-4,5-6 407

[4] Defenses 413 [a] Central Soya Company, Inc. (Venezuela: 1967), OPIC Action

Memorandum: Denial of Expropriation Claim - Contracts Nos. 5128 and 5129 - of21 September 1967,2-3 413

[b] TheAnaconda Company 6" Chile Copper Company v. Overseas Private Investment Corporation (AAA Case No. 16 10 0071 72), Award of 17 JuJy 1975,14I.L.M. 1210,1211,1235-1246 (1975) 414

[5] Comments and Questions 418 [B] Currency Inconvertibility Claims 420

[ 1 ] Reasonable Steps to Convert Local Currency 420 [a] Philippine Geothermal, Inc. (The Philippines: 1984), OPIC

Memorandum of Determinations: Inconvertibility Claim of Philippine Geothermal, Inc. - Contract of Insurance No. 8577 - of 10 August 1984 420

[2] Lack ofPre-existing Law or Regulation 422 [a] Active Inconvertibility 422

[i] Kimberly Clark Corp. (Honduras: 1990), OPIC Memorandum of Determinations: Inconvertibility Claim of Kimberly Clark Corporation - Contract of Insurance No. A663 - of 22 May 1990,1-3,4,9 422

[b] Passive Inconvertibility 424 [i] Phelps Dodge Corp. (Honduras: 1999), OPIC

Memorandum of Determinations: Inconvertibility Claim of Phelps Dodge Corporation and Phelps Dodge International Corporation - Contracts of Insurance Nos. A021, A022, and A023 - of 28 December 1999 424

[3] Comments and Questions 426 [C] PoliticalViolence Claims 427

[1] Direct Causation 427

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[a] Nord Resources Corporation (Sierra Leone: 1998), OPIC Memorandum of Determination^: Political Violence Claim of Nord Resources Corporation - Contract of Insurance No. A628 (as amended the 'Contract') - of 14 May 1998,1-2,4 427

[b] Haitian Tropica! Management, S.A. (Haiti: 1992), OPIC Executive Summary: Political Violence Claim of Haitian Tropical Management, S.A. - Contract of Insurance No. C042 - of 23 November 1992,1 430

[2] Political Motivation 431 [a] Freeport Minerals Corp. (indonesia: 1986), OPIC

Memorandum of Determination«: War, Revolution, Insurrection and Civil Strife Claim of Freeport Minerals -Contract of Guaranty No. 7034 and Contract of Insurance No. 9704 - of 30 September 1986 431

[b] Beckman Instruments, Inc. (El Salvador: 1982), OPIC Memorandum of Determinations: War, Revolution, Insurrection and Civil Strife Claim of Beckman Instruments, Inc. - Contracts of Insurance Nos. 9652 and 9653 - of 27 August 1982 434


Chapter 6 Applicable Substantive Law 437 §6.01 Introduction 437

[A] Rudolf Dolzer and Christoph H. Schreuer, Principles of International Investment Law, 211,288-289 (2nd ed., Oxford University Press 2012), Chapter X: Settling Investment Disputes 437

[B] Comments and Questions 438 [C] Convention on the Recognition and Enforcement of Foreign Arbitral

Awards [New York Convention] (1958), 330 U.N.T.S. 38 (1959), Article V 439

[D] Comments and Questions 440 § 6.02 The Choice of Law Process in International Commercial Arbitration 440

[A] Rules of Arbitration of the International Chamber of Commerce (2012), Article 21 440

[B] Convention on the Settlement of Investment Disputes Between States and Nationais of Other States [ICSID or Washington Convention] (1965), 575 U.N.T.S. 159 (1965), Article 42 440

[C] UNCITRAL Model Law on International Commercial Arbitration (1985, amended 2006), Article 28 441

[D] UNCITRAL Arbitration Rules (l976, revised 2010), Article 35 441 [E] Regulation (EC) No. 593/2008 ofthe European Parliament and of

the Council of 17 June 2008 on the Law Applicable to Contractual Obligations (Rome I), OJ L 177,4.7.2008,6, Articles 3 and 4 441

[F] Comments and Questions 443

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§ 6.03 Options for the Applicable Law 443 [A] National Law 443

[ l] Responsibility ofthe State for Injuries Caused in Its Territory to the Person orProperty of Aliens - Measures Ajfecting Acquired Rights: Pourth Report by F. V. Garcia Amador, [ 1959] 2 Y.B. Int'l L. Comm'n 1,26, U.N. Doc. A/CN.4/119 443

[2] Comments and Questions 445 [B] National Law with International Guarantees 445

[ l] AGIP S.p.A. v. People's Republic of the Congo (ICSID Case No. ARB/77/1), Award of 30 November 1979,1 ICSID Rep. 306,67 I.L.R. 318 (1979) [Jorgen Trolle (pres.), Rene-Jean Dupuy, Puad Rouhani] 445

[2] Klöckner Industrie-Anlagen GmbH and others v. United Republic of Cameroon and Societe Camerounaise des Engrais (ICSID Case No. ARB/81/2), Decision on Annulment of 3 May 1985,2 ICSID Rep. 95 (1994) [Pierre Lalive (pres.), Ahmed Sadek El-Kosheri, Ignaz Seidl-Hohenveldem] 447

[3] Amco Asia Corporation and others v. Republic oflndonesia (ICSID Case No. ARB/81/1), Decision on the Application for Annulment of 16 May 1986,1 ICSID Rep. 509 (1993) [Ignaz Seidl-Hohenveldern (pres.), Florentino P. Feliciano, Andrea Giardina] 448

[4] W. Michael Reisman, The Regime for Lacunae in the ICSID Choice ofLaw Provision and the Question oflts Threshold, 15 ICSID Rev. -Foreign Inv. L.J. 362,366-380 (2000) 451

[5] Wena Hotels Limited v. Arab Republic ofEgypt (ICSID Case No. ARB/98/4), Decision on Annulment of 5 February 2002, [Konstantinos D. Kerameus (pres.), Andreas Bucher, Francisco Orrego Vicuna] 454

[6] Azurix Corp. v. Argentine Republic (ICSID Case No. ARB/Ol/12), Decision on the Application for Annulment of 1 September 2009 [Gavan Griffith QC (pres.), Bola Ajibola, Michael Hwang] 456

[7] Comments and Questions 459 [C] Internationalization 459

[ 1 ] Petroleum Development (Trucial Coast) Ltd. v. Sheikh ofAbu Dhabi, Award of September 1951,181.L.R. 144,148-150 (1951) [Lord Asquith (sole arbitrator)] 459

[2] Comments and Questions 461 [3] Texaco Overseas Petroleum Company and Californian Asiatic Oil

Company v. The Government ofthe Libyan Arab Republic, Award on the Merits of 19 January 1977,531.L.R. 420,457-462 (1977) [Rene-Jean Dupuy (sole arbitrator)] 461


xxi


[5] ltalian Enterprise v. Syrian Enterprise (ICC Case No. 3380), Award of 29 November 1980,108 Journal du Droit International (Clunet, No. 4) 928,928-930 (1981) 464

[6] Comments and Questions 466 [ 7] Government of Kuwait v. American Independent Oil Co.

(AMINOIL), Award of 24 March 1982, 66 Int'l L. Rep. 518, 559-562 (1982) [Paul Reuter (pres.), Hamed Sultan, Gerald Fitzmaurice] 466

[8] Comments and Questions 468 [9] United States v. Iran (IUSCT Case No. B36), Award of 23 March

1997 [Krzysztof Skubiszewski (pres.), George H. Aldrich, Koorosh H. Ameli] 468

[10] James R. Crawford, Treaty and Contract in Investment Arbitration, 24 Arb Int'l 351,352-353,360-361,367-370,373-374 (2008) 469

[11] Wintershall A.G.f et al. v. Government ofQatar, Partial Award on Liability of 5 February 1988,281.L.M. 795, 802 (1989) [John R. Stevenson (pres.), Ian Brownlie, Bernardo M. Cremades] 473

[12] Comments and Questions 474 [D] Direct Claims under Treaties 474

[1] JanPaulsson, Arbitration WithoutPrivity, 10(2) ICSID Rev. -Foreign Inv. L.J. 232,232-234,254-257 (1995) 475

[2] Comments and Questions 477 [3] Asian Agricultural Products Limited v. Republic ofSri Lanka (ICSID

Case No. ARB/87/3), Award of 27 June 1990,4 ICSID Rep. 250, 256-257 (1997) [Ahmed Sadek El-Kosheri (pres.), Samuel K.B. Asante, Berthold Goldman] 478

[4] Comments and Questions 480 [5] Compania deAguas delAconquija S.A. and Vivendi Universal v.

Argentine Republic (ICSID Case No. ARB/97/3), Decision on Annulment of 3July 2002,19(l) ICSID Rev. - Foreign Inv. L.J. 89,117,127-131 (2004) [L.Yves Fortier (pres.), James R. Crawford, Jose Carlos Fernändez Rozas] 480

[6] Comments and Questions 483 [7] ADCAffiliate Limited andADC & ADMC Management Limited v.

The Republic ofHungary (ICSID Case No. ARB/03/16), Award of 2 October 2006 [Charles N. Brower (pres.), Albert Jan van den Berg, Neil Kaplan] 484

§ 6.04 Applicable International Law 485 [A] The Sources of International Law 485

[1] Statute of the International Court ofjustice (1945), Article 38 485 [2] Comments and Questions 485

[B] Applicable Treaty Standards 485 [1] North American Free Trade Agreement (1994), 321.L.M 289

(1993), Chapter 11: Investment 486 [2] France - Argentina, Treaty Concerning the Treatment and

Protection of Investments (1991), 1728 U.N.T.S. 298 489

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[C] OtherSources of International Law 493 [ 1 ] Texaco Overseas Petroleum Company and Califomian Asiatic Oil

Company v. The Government of the Libyan Arab Republic, Award on the Merits of 19 January 1977,531.L.R. 420,484-485,490-495 (1979) [Rene-Jean Dupuy (sole arbitrator)] 493

[2] Comments and Questions 496 [3] Libyan American Oil Company (LLAMCO) v. Government ofthe

Libyan Arab Republic, Award of 12 April 1977,621.L.R. 140,187-189 (1982) [Sobhi Mahmassani (sole arbitrator)] 496

[4] SED CO Inc v. National Iranian Oil Company and Islamic Republic oflran (IUSCT Case No. 129), Interlocutory Award of27 March 1986 [Nils Mangard (pres.), Charles N. Brower, Parviz Ansari Moin] 498

[5] Comments and Questions 500 § 6.05 Sources of "Non-National" Law: the Lex Mercatoria 500

[A] Michael J. Mustill, The New Lex Mercatoria: The First Twenty-five Years, in Maarten Bos and Ian Brownlie, LiberAmicorumfor the Rt. Hon. Lord Wilberforce, 149,162-166 (Clarendon Press, 1987) 501

[B] State party (State X) v. Private contractor (United Kingdom) (ICC Case No. 7110), First Partial Award of June 1995,10(2) ICC Bulletin 39, 39-40(1999) 503

[C] Watkins-Johnson Company and Watkins-Johnson Limited v. Islamic Republic oflran and Bank Saderat Iran (IUSCT Case No. 370), Award of 28 July 1989 [Karl-Heinz Bockstiegel (pres.), Assadollah Noori] 504

[D] Seiler v. Buyer (ICC Case No. 5713), Final Award of 1989,15 Y.B. Comm 1 Arb. 70,70-73 (1990) 505

[E] Comments and Questions 506 [F] James Crawford and Anthony Sinclair, The UNIDROIT Principles

of International Commercial Contracts and their Application to State Contracts, ICC Bulletin - Special Supplement 57,57-75 (2002) 507

[G] Joseph C. Lemire v. Ukraine (ICSID Case No. ARB/06/18), Decision on Jurisdiction and Liability of 21 January 2010 [Juan Fernändez-Armesto (pres.), Jan Paulsson, Jürgen Voss] 509

[H] Comments and Questions 510

Chapter 7 International Responsibility: General Principles 511 §7.01 Development ofthe Law of State Responsibility 511

[A] The Concept of Diplomatie Protection 511 [ 1] Mavrommatis Palestine Concessions (Greece v. United Kingdom),

Decision on Jurisdiction of 30 August 1924, [ 1924] P.C.I.J. Series A-No.2,5,12(1924) 511

[2] Panevezys-Saldutiskis Railway (Estonia v. Lithuania), Judgment of 28 February 1939, [ 1939] P.C.I.J. Series A/B - No. 76,5,6,16 (1939) 512

xxiii


[3] Nottebohm (Liechtenstein v. Guatemala), Second Phase, Judgment of 6 April 1955, [1955] I.C.J. Rep. 4,16-17,20-24,26 (1955) 512

[4] Comments and Questions 516 [5] Barcelona Traction, Light and Power Company, Limited (Belgium

v. Spain) (New Application: 1962), Second Phase, Judgment of 5 February 1970, [1970] I.C.J. Rep. 3,41-51 (1970) 516

[6] Elettronica Sicula S.p.A. (ELSI) (United States of America v. Italy), Judgment of 20 July 1989, [1989] I.C.J. Rep. 15,89-93 (1989) 521

[7] LaGrand (Germany v. United States of America), Judgment of 27 June 2001, [2001] I.C.J. Rep. 466,480-483,492-494 (2001) 523

[8] Comments and Questions 527 [9] The Loewen Group Inc. and Raymond L. Loewen v. United States of

America (ICSID Case No. ARB(AF)/98/3), Award of 26 June 2003, 7 ICSID Rep. 442,484-490 (2005) [Anthony Mason (pres.), Abner J. Mikva, Michael Mustill] 527

[10] Comments and Questions 531 [ 11 ] International Law Commission, Articles on Diplomatie Protection,

OfScial Records ofthe General Assembly, Sixty-first Session, Supplement No. 10 (UN Doc. A/61/10) 532

[ 12] Ahmadou Sadio Diallo (Republic of Guinea v. Democratic Republic ofthe Congo), Preliminary Objections, Judgment of 24 May 2007, [2007] I.C.J. Rep. 582,601-602,605-606,610,614-616 (2001) 533

[B] The General Character of State Responsibility Principles 536 [ l] International Law Commission, Articles on Responsibility of States

for Internationally WrongfulActs, General Commentary, [2001] 2(2) Y.B. Int'l L. Comm'n 30,31-32 (2001) 537

[2] Mohammad Ammar Al-Bahloül v. Tajikistan (SCC Case No. V 064/2008), Partial Award on Jurisdiction and Liability of 2 September 2009 [Jeffrey M. Hertzfeld (pres.), Richard Happ, Ivan S. Zykin] 538

[C] Delictual and Treaty Responsibility 539 [1] Rainbow Warrior (New Zealand v. France), Award of 30 April 1990,

20R.I.A.A. 215, 251 (1990) [Eduardo Jimenez de Arechaga (pres.), Kenneth Keith, Eduardo Jimenez de Arechaga] 539

[2] Comments and Questions 540 [3] International Law Commission, Articles on Responsibility of States

for Internationally WrongfulActs, Article 12 and Commentary, [2001] 2(2) Y.B. Int'l L. Comm'n 30,54-55 (2001) 540

[D] Responsibility under International and Internal Law 541 [1] Elettronica Sicula S.p.A. (ELSI) (United States of America v. Italy),

Judgment of 20 July 1989, [1989] I.C.J. Rep. 15, 51, 74 (1989) 541 [2] International Law Commission, Articles on Responsibility of States

for Internationally WrongfulActs, Article 3 and Commentary, [2001] 2(2) Y.B. Int'l L. Comm'n 30,36-38 (2001) 542

[E] The Lex Specialis Issue 545

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[ 1 ] International Law Commission, Artides on Responsibility of States for Internationally Wrongful Acts, Article 55 and Commentary, [2001] 2(2) Y.B. Int'l L. Comm'n 30,54-55 (2001) 545

[2] International Law Commission, Conclusions ofthe work ofthe Study Group on the Fragmentation of International Law: Difßculties arisingfrom the Diversification and Expansion of International Law, [2006] 2(2) Y.B. Int'l L. Comm'n 175,178-179 (2006) 547

§ 7.02 Attribution of Conduct to the State 548 [A] Organs of the State or of Political Subdivisions 548

[ 1 ] International Law Commission, Articles on Responsibility of States for Internationally Wrongful Acts, Article 4 and Commentary, [2001] 2(2) Y.B. Int'l L. Comm'n 30,40-42 (2001) 548

[2] Restatement (Third) Foreign Relations Law of the United States, § 207,96-98 (American Law Institute 1987) 552

[3] Compania deAguas delAconquija, S.A. and Compagnie Generale des Eaux v. Argentine Republic (ICSID Case No. ARB/97/3), Award of 21 November 2000,16 ICSID Rev. - Foreign Inv. L.J. 641 (2001) [Francisco Rezek (pres.), Thomas Buergenthal, Peter D. Trooboff] 553

[4] Application ofthe Convention on the Prevention and Punishment ofthe Crime ofGenocide (Bosnia and Herzegovina v. Serbia and Montenegro), Judgment of 26 February 2007, [2007] I.C.J. Rep. 43,203,205-206 (2007) 555

[5] Jan de Nul NVand DredgingInternational NV v. Egypt (ICSID Case No. ARB/04/13), Award of 6 November 2008 [Gabrielle Kaufmann-Köhler (pres.), Pierre Mayer, Brigitte Stern] 557

[6] Comments and Questions 558 [B] State Enterprises 558

[1] Wintershall A.G., etal. v. Government of Qatar, Partial Award on Liability of 5 February 1988,281.L.M. 795,811-812 (1989) [John R. Stevenson (pres.), Ian Brownlie, Bernardo M. Cremades] 558

[2] International Law Commission, Articles on Responsibility of States for Internationally Wrongful Acts, Article 5 and Commentary, [2001] 2(2) Y.B. Int'l L. Comm'n 30,42-43 (2001) 559

[3] Jan de Nul NV and Dredging International NV v. Egypt (ICSID Case No. ARB/04/13), Award of 6 November 2008 [Gabrielle Kaufmann-Kohler (pres.), Pierre Mayer, Brigitte Stern] 562

[4] Toto Construzioni Generali S.p.A. v. Lebanon (ICSID Case No. ARB/07/12), Decision on Jurisdiction of 11 September 2009 [Hans van Houtte (pres.), Alberto Feliciani, Alberto Feliciani] 563

[C] Conduct of Private Parties 565 [l] Tradex Hellas S.A. (Greece) v. Republic ofAlbania (ICSID Case No.

ARB 94/2), Award of 29 April 1999,14 ICSID Rev. - Foreign Inv. L.J. 197,233,235-240,244-245 (1999) [Karl-Heinz Bockstiegel (pres.), Fred F. Fielding, Andrea Giardina] 565

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Foreign Investment Disputes — Cases, Materials and Commentary

[2] International Law Commission, Articles on Responsibility of States for Internationally Wrongful Acts, Article 9 and Commentary, [2001] 2(2) Y.B. Int'l L. Comm'n 30,49 (2001) 567

[3] International Law Commission, Articles on Responsibility of States for Internationally WrongfulActs, Article 10 and Commentary, [2001] 2(2) Y.B. Int'l L. Comm'n 30, 50 (2001) 568

[4] Comments and Questions 569 [D] Succession to Responsibility 570

[1] Tinoco Case (GreatBritain v. Costa Rica), Award of 18 October 1923,1 R.I.A.A. 375,381-384 (1923) [William H. Taft (sole arbitrato r)] 570

[2] Arbitration of Lighthouses (France v. Greece), Claims No. 11 and 4 (PCA), Award of 24 July 1956,231.L.R. 81,88-93 (1956) [Jan Hendrik Willem Verzijl (pres.), Achille Mestre, Georges Charbouris] 572

[3] Comments and Questions 576 §7.03 Breach of an International Obligation 576

[A] The Concept of Due Diligence and the Roleof Fault 577 [1] Alabama Arbitration, Award of 14 September 1872, in J.B. Moore,

History and Digest ofthe International Arbitrations to which the United States has been a Party, Vol. 1,495, 550, 572-573 (US Government Printing Office 1898) [Charles Francis Adams, Alexander James Edmund Cockburn, Frederick Sclopis, James Stampfl!, Marcos Antonio dAraujo] 577

[2] James R. Crawford, The International Law Commission's Articles on State Responsibility: Introduction, Textand Commentaries, 13-14 (Cambridge University Press 2002) 578

[B] Obligations of Conduct and Result 578 [1] International Law Commission, Articles on Responsibility of States

for Internationally Wrongful Acts, Commentary to Article 12, [2001] 2(2) Y.B. Int'l L. Comm'n 30,56 (2001) 579

[2] James R. Crawford, State Responsibility: The General Part, 220-223 (Cambridge University Press 2013) 579

[C] Irrelevance of Sovereign/Commercial Act Distinction 581 [ 1 ] Swedish Engine Drivers' Union v. Sweden (Application No.

5614/72),6February 1976, [1976] ECHRRep.,SeriesA-No. 20(1976) Sgl


Chapter 8 Violations of Investor Rights Under Customary International Law 583 § 8.01 Relationship Between Customary International Law and the International

Investment Law Regime -[A] Jose E. Alvarez, The Public International Law Regime Governing

International Investment, 94,105-108,114-117 (Hague Academy of International Law 2011)

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[B] Stephen M. Schwebel, Investor-State Disputes and the Development of International Law: The Influence of Bilateral Investment Treaties on Customary International Law, 98 Am. Soc'y Int'l L. Proc. 27,27-30 (2004) 585

[C] Patrick Dumberry, Are BITs Representing the "New" Customary International Law in International Investment Law ?, 28 Penn St. Int'l L. Rev. 675,701 (2010) 588

§ 8.02 Expropriation 589 [A] Introduction 589

[1] Responsibility ofthe Statefor Injuries Causedinlts Territory to the Person or Property of Aliens - Measures Aßecting Acquired Rights: Fourth Report by F. V. Garcia Amador, [1959] 2 Y.B. Int'l L. Comm'n 1,11-12,14-16, U.N. Doc. A/CN.4/119 589

[B] General Distinction 593 [ 1 ] Direct - De Jure 593

[a] Compania del Desarrollo de Santa Elena, S.A. v. The Republic of Costa Rica (ICSID Case No. ARB/96/1), Final Award of 17 February 2000 [L. Yves Fortier (pres.), Elihu Lauterpacht, Prosper Weil] 593

[b] Martin Domke, Foreign Nationalizations: Some Aspeds of Contemporary International Law, 55 Am. J. Int'l L. 585,587-590(1961) 594

[c] The Oxford Handbook of International Investment Law, 408-409 (Peter Muchlinski, Federico Ortino and Christoph Schreuer (eds), Oxford University Press 2008) 595

[2] Indirect - de facto - Creeping 595 [a] Errol P. Mendes, The Canadian National Energy Program:

An Example ofAssertion of Economic Sovereignty or Creeping Expropriation in International Law, 14 Vand. J. Trans. L. 475, 498-501(1981) 595

[b] Waste Management, Inc. v. United Mexican States (ICSID Case No. ARB(AF)/98/2), Arbitral Award of 2 June 2000 -Dissenting Opinion of Keith Highet of 8 May 2000 [Bernardo M. Cremades (pres.), Keith Highet, Eduardo Siqueiros T.] 598

[c] Rumeli Telekom A.S. and Telsim Mobil Telekomunikasyon Hizmetleri A.S. v. Republic ofKazakhstan (ICSID Case No. ARB/05/16), Award of29July 2008 [Bernard Hanotiau (pres.), Marc Lalonde, Stewart Boyd] 598

[d] Walter Bau AG v. Thailand (ad hoc arbitration under the 1976 UNCITRAL Rules), Award of 1 July 2009, HC 429 (2009) [Ian Barker (pres.), Marc Lalonde, Jayavadh Bunnag] 600

[e] UNCTAD, Bilateral Investments Treaties in theMid-1990s, 65-66 (United Nations 1998) 602

[f] Comments and Questions 603 [C] Initial Precepts - Government is not a Guarantor or Insurer of the

Investment 603

xxvii


[a] United Kingdom v. Belgium (The Oscar Chinn case), Judgment of 12 December 1934,3 World Court Reports 416,436, 439 (1932-1935) (Manley O. Hudson (ed.) with the collaboration ofRuth E. Bacon, By the Carnegie Endowment for International Peace, Rumford Press, 1938) 603

[b] Wena Hotels Limited v. Arab Republic of Egypt (ICSID Case No. ARB/98/4), Award of 8 December 2000 [Monroe Leigh (pres.), Ibrahim Fadlallah, Don. Wallace, Jr.] 604

[D] Property Expropriated 605 [1] Tangible Property 605

[a] Sedco, Inc. v. National Iranian Oil Company and The Islamic Republic oflran (IUSCT Case No. 129), Award No. 309-129-3 of 2July 1987 [Nils Mangärd (chairman), Charles N. Brower, Parviz Ansari Moin] 605

[b] Oil Field of Texas, Inc. v. The Government ofthe Islamic Republic oflran, National Iranian Oil Company (Iran-United States Claims Tribunal Case No. 43), Award No. 258-43-1 of 8 October 1986 [Karl-Heinz Böckstiegel (chairman), Richard M. Mosk, Mohsen Mostafavi] 605

[2] Real Property 606 [a] Metalclad Corporation v. The United Mexican States (ICSID

Case No. ARB/(AF)/97/l), Award of 30 August 2000 [Elihu Lauterpacht (pres.), Benjamin R. Civiletti, Jose Luis Siqueiros] 606

[b] Compania del Desarrollo de Santa Elena, S.A. v. The Republic of Costa Rica (ICSID Case No. ARB/96/1), Final Award of 17 February 2000 [L. Yves Fortier (pres.), Elihu Lauterpacht, Prosper Weil] 608

[c] Burlington Resources Inc. v. Republic of Ecuador (ICSID Case No. ARB/08/5), Decision on Liability of 14 December 2012 111-113 [Gabrielle Kaufmann-Kohler (pres.), Brigitte Stern, Francisco Orrego Vicuna] 609

[3] Stocks and Shares 610 [a] Dr. Horst Reineccius, FirstEagle SoGen Funds, Inc., Mr. Pierre

Mathieu and la Societe de Concours Hippique de la Chätre v. Bank of International Settlements, Arbitral Tribunal ofthe Bank of International Settlements (Permanent Court of Arbitration), Partial Award of 22 November 2002 on the Lawfulness of the Recall ofthe Privately Held Shares on 8 January 2001 and the Applicable Standards for Valuation of Those Shares, 74-75, 77-81 [W. Michael Reisman (pres.), Jochen A. Frowein, Mathias Krafft, Paul Lagarde, Albert Jan van den Berg] 610

[4] BankAccounts 612 [a] American Bell International, Inc. v. The Islamic Republic of

Iran, The Ministry of Defense ofthe Islamic Republic of Iran, the Ministry of Post, Telegraph and Telephone ofthe Islamic Republic

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oflran, and The Telecommunications Company oflran (IUSCT Case No. 48), Award No. 255-48-3 of 19 September 1986 [Michel Virally (pres.), Charles N. Brower, Parviz Ansari Moin] 612

[5] Dividends 613 [a] Foremost Tehran, Inc., et al. v. The Government ofthe Islamic

Republic oflran, etat (IUSCT Case Nos. 37 and 231), Award No. 220-37/231-1 of 11 April 1986 [Gunnar Lagergren (pres.), Koorosh-Hossein Ameli, Howard M. Holtzmann] 613

[6] Bonds 616 [a] Edwin Borchard, State Insolvency and Foreign Bondholders, Vol.

I, General Principles, 193,200-202 (Yale University Press 1951) 616 [b] Abaclat and Others v. Argentine Republic (formerly Giovanna A.

Beccara and Others v. The Argentine Republic) (ICSID Case No. ARB/07/5), Decision on Jurisdiction and Admissibility of 4 August 2011 [Pierre Tercier (pres.), Georges Abi-Saab, Albert Jan van den Berg] 617

[7] Management of Business 619 [a] Sedco, Inc. for itself and on behalf ofSedco International, S.A.,

and Sediran Drilling Company v. National Iranian Oil Company and The Islamic Republic oflran (IUSCT Case No. 129), Award No, ITL 55-129-3 of 28 October 1985 [Nils Mangärd (pres.), Charles N. Brower, Parviz Ansari Moin] 619

[b] Starrett Housing Corporation, Starrett Systems, Inc., Starrett Housing International, Inc., v. The Government ofthe Islamic Republic oflran, Bank Omran, BankMellat, BankMarkazi (IUSCT Case No. 24), Interlocutory Award No. ITL 32-24-1 of 19 December 1983 [Gunnar Lagergren (pres.), Mahmoud M. Kashani, Howard M. Holtzmann] 619

[8] Contractual Rights 621 [a] Phillips Petroleum Company Iran v. The Islamic Republic oflran

and The National Iranian Oil Company (IUSCT Case No. 39), Award No. 425-39-2 of 29 June 1989 [Robert Briner (pres.), Seyed K. Khalilian, George H. Aldrich] 621

[b] Amoco International Finance Corporation, v. The Government of the Islamic Republic oflran, et al (IUSCT Case No. 56), Award No. 310-56-3 of 14July 1987 [Michel Virally (pres.), Charles N. Brower, Parviz Ansari Moin] 622

[c] Mobil Oil Iran Inc., et al. v. Government ofthe Islamic Republic of Iran and National Iranian Oil Company (IUSCT Case Nos. 74, 76,81,150), Award No. 311-74/76/81/150-3 of 14July 1987 [Michel Virally (pres.), Charles N. Brower, Parviz Ansari Moin] 624

[d] Waste Management, Inc. v. United Mexican States (ICSID Case No. ARB(AF)/00/3), Award of 30 April 2004 [James Crawford (pres.), Benjamin R.Civiletü, Eduardo Magallön Gömez] 626


[e] Saipem S.p.A. v. The People's Republic of Bangladesh (ICSID Case No. ARB/05/7), Award of 30 June 2009 [Gabrielle Kaufmann-Kohler (pres.), Christoph H. Schleuer, Philip Otton] 628

[f] Comments and Questions 630 [9] Intangible Property (e.g, Intellectual Property, Goodwill) 631

[a] Case Concerning the Factory at Chorzöw (Claim for Indemnity) (TheMerits), P.C.I.J. Judgment No. 13 of 13 September 1928, P.C.I.J. Series A - Nos. 10-17 Recueil Des Arrets (Chorzöw Series A-No. 17 atp. 51) 631

[b] Amoco International Finance Corporation v. The Government of the Islamic Republic oflran, et al. (IUSCT Case No. 56), Award No. 310-56-3 of 14 July 1987 [Michel Virally (pres.), Charles N. Brower, Parviz Ansari Moin] 631

[c] Comments and Questions 632 [10] Use of Property 632

[a] Thomas Waelde and Abba Kolo, Environmental Regulation, Investment Protection and 'Regulatory Taking in International Law, 50 Int'l & Comp. L.Q.811,839-840, 846-847 (2001) 632 [i] Protocol to the Convention for the Protection of Human

Rights and Fundamental Freedoms, as amended by Protocol No. 11, Paris, 20 March 1952. Article 1 -Protection of Property (Council of Europe, European Treaty Series - No. 009, page 3) 634 [aa] LegitimateAims 634 [bb] Control is Proportionale to the Aims 634

[b] Katte Klitsche de la Grange v. Italy (Development ban on private land), before the European Court of Human Rights, Series A, No. 293-B, Application No. 12539/86, Judgment of 27 October 1994,19 Eur. H.R. Rep. 368 (1995) 634

[c] Trustees ofthe Late Duke ofWestminster's Estate v. United Kingdom (The Leasehold Reform Acts case), before the European Commission of Human Rights, Application No. 8793/79, Decision as to Admissibility of 28 January 1983, 5 Eur. H.R. Rep. 440,441,463-464 (1983) 635

[E] Expropriatory Intent 636 [l] Question ofthe NecessityofExpropriatory Intent 636

[a] Tippetts, Abbett, McCarthy, Stratton v. TAMS-AFFA Consulting Engineers oflran, et al. (IUSCT Case No. 7), Award No. 141-7-2 of 29 June 1984 [Willem Riphagen (pres.), Shafie Shafeiei, George H. Aldrich] 636

[b] Phillips Petroleum Company Iran v. The Islamic Republic oflran, The National Iranian Oil Company (IUSCT Case No. 39), Award No. 425-39-2 of 29 June 1989 [Robert Briner (pres.), Seyed K. Khalilian, George H. Aldrich] 637

[c] Comments and Questions 637

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[2] Effect of Act 011 Interests 638 [a] Tippetts, Abbett, McCarthy, Stratton v. TAMS-AFFA Consulting

Engineers oflran, et al. (IUSCT Case No. 7), Award No. 141-7-2 of 29June 1984 [Willem Riphagen (pres.), Shafie Shafeiei, George H. Aldrich] 638

[F] Standards 638 [ 1 ] Direct Expropriation: the Government Acquires Title and

Benefits fem It 638 [a] Eudoro Armando Olgutn v. Republic of Paraguay (ICSID Case

No. ARB/98/5), Decision on Objections to Jursdiction of 8 August 2000 [Rodrigo Oreamuno (pres.), Eduardo Mayora Alvarado, Francisco Rezek] 638

[b] CME Czech Republic BV. (The Netherlands) v. The Czech Republic, UNCITRAL Arbitration Proceedings, Partial Award of 13 September 2001 (UNCITRAL Ad Hoc Trib. 2001) [Wolfgang Kühn (pres.), Stephen M. Schwebel,Jaroslav Hindi] 638

[2] Indirect Expropriation 640 [a] G.C. Christie, What Constitutes a Taking ofProperty Under

International Law?, 38 Brit. Y.B. Int'l L. 307,322-324,330-333,336-338(1962) 640

[b] Antoine Biloune and Marine Drive complex Ltd v. Ghana Investments Centre and the Government of Ghana, Award on Jurisdiction and Liability of 27 October 1989,95 Int'l L. Rep. 183,209-210 (1994) [Stephen M. Schwebel (pres.), Don Wallace, Jr., Monroe Leigh] 644

[c] Wena Hotels Limited v. Arab Republic of Egypt (ICSID Case No. ARB/98/4), Award of 8 December 2000 [Monroe Leigh (pres.), Ibrahim Fadlallah, Don. Wallace, Jr.] 645

[d] Generation Ukraine, Inc v. Ukraine (ICSID Case No. ARB/00/9), Award of 16 September 2003 [Jan Paulsson (pres.), Eugen Salpius, Jürgen Voss] 647

[e] Comments and Questions 650 [3] Legitimate Expectations of Investor 651

[a] OpelAustria GmbH v. Council ofthe European Union (Case T-l 15/94), Judgment the Court of First Instance (Fourth Chamber) of 22 January 1997, European Court Reports (1997), 11-00039 [K. Lenaerts (pres.), P. Lindh, J. D. Cooke] 651

[b] Comments and Questions 652 [G] Governmental Acts 653

[1] Laws and Decrees Explicitly Expropriating 653 [a] Anglo-Iranian Oil Co. Case, 19521.C.J. 103,103-114 (July

22) (Jurisdiction denied) 653 [b] Bolivia: Supreme Decree No. 28701,1 May 2006,45 ILM

1020,1021 (2006) 653 [2] Appointment of Managers 653

xxxi


[a] Anglo-Iranian Oil Co. Case, 1952 I.C.J. 103,103-114 (July 22) (Jurisdiction denied) ^53

[3] Seizure of Premises and Impoundment of Property 653 [4] Announcement oflntended Expropriation without Further Acts 654

[a] Sola Tiles, Inc. v. The Government ofthe Islamic Republic oflran (IUSCT Case No. 317), Award No. 298-317-1 of 22 April 1987 [Karl-Heinz Böckstiegel (pres.), Mohsen Mostafavi, Howard M. Holtzmann] 654

[b] Comments and Questions 655 [c] Agrotexim and Others v. Greece (Town planning measures

taken by a municipality with a view to expropriating Company property), before the European Court of Human Rights, Series A, No. 330, Application No. 14807/89, Judgment of 24 October 1995,21 Eur. H.R. Rep. 250 (1995) 655

[d] Compania del Desarrollo de Santa Elena, S.A. v. The Republic of Costa Rica (ICSID Case No. ARB/96/1), Final Award of 17 February 2000 [L. Yves Fortier (pres.), Elihu Lauterpacht, Prosper Weil] 655

[5] Unilateral Reduction of Concession Area 655 [a] Liberian Eastern Timber Corporation ("LETCO") v. The

Government ofthe Republic of Liberia (ICSID Case No. ARB/83/2), Award of 31 March 1986, 2 ICSID Rep. 346 (1994) [BernardoM. Cremades (pres.), Jorge Gongalves Pereira, Alan Redfern] 655

[6] Use Restrictions 657 [7] Forced Sales 658

[a] G.C. Christie, What Constitutes a Taking of Property Under International Law?, 38 Brit. Y.B. Int'l L. 307,324-326,328-329 (1962) 658

[b] Comments and Questions 660 [8] Cessation ofProject Work Dueto Governmental Interference 661

[a] Antoine Biloune and Marine Drive complex Ltd v. Ghana Investments Centre and the Government of Ghana, Award on Jurisdiction and Liability of 27 October 1989,95 Int'l L. Rep. 183,209-210 (1994) [Stephen M. Schwebel (pres.), Don Wallace, Jr., Monroe Leigh] 661

[9] Setting Product Price at Lossby Governmental Decree 661 [a] S.A.R.L. Benvenuti and Bonfant v. People's Republic ofthe Congo

(ICSID Case No. ARB/77/2), Award of 8 August 1980, 1 ICSID Rep. 330 (1993) [Jorgen Trolle (pres.), Rudolf Bystricky, Edilbert Razafindralambo] 661

[b] Pope & Talbott Inc. v. The Government ofCanada (ad hoc arbitration under the 1976 UNCITRAL Rules), Award on the Merits of Phase 2 by Arbitral Tribunal of 10 April 2001 [Lord Dervaird (pres.), BenjaminJ. Greenberg, MurrayJ. Belman] 661

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[H] Legality 662 [ 1 ] Form of Expropriation (e.g., Due Process) 662

[a] Responsibility ofthe State for Injuries Caused in Its Territory to the Person or Property of Aliens - Measures Affecting Acquired Rights: Fourth Report by F. V. Garcia Amador, [1959] 2 Y.B. Int'l L. Comm'n 1, U.N. Doc. A/ CN.4/119 662

[b] Sedco, Inc. v. National Iranian Oil Company and The Islamic Republic oflran (IUSCT Case No. 129), Award No. ITL 59-129-3 of 27 March 1986 [Nils Mangärd (pres.), Charles N. Brower, Parviz Ansari Moin] 662

[2] Purpose 663 [a] Not for a Public Purpose 663

[i] Amoco International Finance Corporation, v. The Government ofthe Islamic Republic oflran, et al. (IUSCT Case No. 56), Award No. 310-56-3 of 14July 1987 [Michel Virally (pres.), Charles N. Brower, Parviz Ansari Moin] 663

[b] Discrimination 664 [i] Sociedad Minera el Teniente S.A. v. The Aktiengesellschaft

Norddeutsche Attinerie (Chilean Copper case), Superior Court of Hamburg Docket No. 80 0 4/73, Decision of 22 January 1973,121.L.M. 251,276-278 (1973) 664

[ii] Liberian Eastern Timber Corporation ("LETCO") v. The Government ofthe Republic of Liberia (ICSID Case No. ARB/83/2), Award of 31 March 1986,2 ICSID Rep. 346 (1994) [Bernardo M. Cremades (pres.), Jorge Gon^alves Pereira, Alan Redfern] 665

[c] Violation of stabilization clause 665 [i] AGIP Spav. The Government ofthe Populär Republic of

the Congo (ICSID Case No. ARB/77/1), Award of 30 November 1979,67 Int'l L. Rep. 318 (1984) [Jorgen Trolle (pres.), Rene-Jean Dupuy, Fuad Rouhani] 665

[ii] Government of Kuwait v. American Independent Oil Company (AMINOLL), Award of 24 March 1982,66 Int'l L. Rep. 518,585-591 (1982) [Paul Reuter (pres.), Hamed Sultan, Gerald Fitzmaurice] 665

[iii] Mobil Oil Iran Inc., et al. v. Government ofthe Islamic Republic oflran and National Iranian Oil Company (IUSCT Case Nos. 74,76,81, ISO), Award No. 311-74/76/81/150-3 of 14July 1987 [Michel Virally (pres.), Charles N. Brower, Parviz Ansari Moin] 669

[d] Comments and Questions 670 [I] Date of Expropriation 670

[ 1 ] Vance R. Koven, Expropriation and the "Jurisprudence" of OPIC, 22 Harv.J. Int'l L. 269,277,311-314 (1981) 670

xxxiii


[2] W. Michael Reisman and Robert D. Sloane, Indirect Expropriation and Its Valuation in the BIT Generation, 74 Brit. Y.B. Int IL. 115, 148,150 (2004) 672

[3] Cases 674 [a] Amoco International Finance Corporation, v. The Government of

the Islamic Republic oflran, et al. (IUSCT Case No. 56), Award No. 310-56-3 of 14 July 1987 [Michel Virally (pres.), Charles N. Brower, Parviz Ansari Moin] 674

[b] Phillips Petroleum Company Iran v. The Islamic Republic of Iran and The National Iranian Oil Company (IUSCT Case No. 39), Award No. 425-39-2 of 29 June 1989 [Robert Briner (pres.), Seyed K. Khalilian, George H. Aldrich] 676

[c] Compama del Desarrollo de Santa Elena, S.A. v. The Republic of Costa Rica (ICSID Case No. ARB/96/1), Final Award of 17 February 2000 [L. Yves Fortier (pres.), Elihu Lauterpacht, Prosper Weil] 676

[d] Comments and Questions 677 [J] Defenses Argued by Governments 677

[1] U.N. Resolutions 677 [a] Permanent Sovereignty over Natural Resources, General

Assembly Resolution 1803 (XVTl) of 14 December 1962 677 [b] Declaration on the Establishment of a New International

Economic Order (l May 1974), A/RES/3201 (S-Vl) 678 [c] Charter of Economic Rights and Duties of States (12

December 1974), A/RES/3281 (XXIX) 678 [2] Cases 679

[a] Texaco Overseas Petroleum Company/California Asiatic Oil Company (TOPCO) v. The Government ofthe Libyan Arab Republic, Award on the Merits of 19 January 1977,171.L.M. 3, 27-31 (1978) [Rene-Jean Dupuy (sole arbitrator)] 679

[b] Comments and Questions 685 [c] Government of Kuwait v. American Independent Oil Company

(AMINOIL), Award of 24 March 1982, 66 Int'l L. Rep. 518 (1982) [Paul Reuter (pres.), Hamed Sultan, Gerald Fitzmaurice] 686

[3] Administrative Contracts 686 [a] The Government ofthe State of Kuwait v. The American

Independent Oil Company (AMINOIL), Award of 24 March 1982,66 Int'l L. Rep. 518,588-589 (pars. 90(3), 9l(i)(ii)) (1982) [Paul Reuter (pres.), Hamed Sultan, Gerald Fitzmaurice] 686

[4] Force Majeure/Impossibility/Frustration 687 [a] Mobil Oil Iran Inc., et al. v. Government ofthe Islamic Republic

oflran, et al. (IUSCT Case Nos. 74, 76, 81,150), Award No. 311-74/76/81/150-3 of 14 July 1987 [Michel Virally (pres.), Charles N. Brower, Parviz Ansari Moin] 687

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[b] CMS Gas Transmission Company v. The Argentine Republic (ICSID Case No. ARB/01/8), Award of 12 May 2005 [Francisco Orrego Vicuna (pres.), Marc Lalonde, Francisco Rezek] 689

[c] Sempra Energy International v. Argentine Republic (ICSID Case No. ARB/02/16), Award of 28 September 2007,102-105 [Francisco Orrego Vicuna (pres.), Marc Lalonde, Sandra Morelli Rico] 694

[d] LG&E Energy Corp., LG&E Capital Corp. and LG&E International Inc. v. Argentine Republic (ICSID Case No. ARB/02/1), Decision on Liability of 3 October 2006,61-62, 64,67-68,70-80 [Tatiana B. de Maekelt (pres.), Francisco Rezek, Albert Jan van den Berg] 696

[5] Implied Termination orWaiver 703 [a] Mobil Oil Iran Inc., et al. v. Government ofthe Islamic Republic

oflran, et al. (IUSCT Case Nos. 74,76,81,150), Award No. 311-74/76/81/150-3 of 14July 1987 [Michel Virally (pres.), Charles N. Brower, Parviz Ansari Moin] 703

[6] Changed Circumstances 703 [a] Mobil Oil Iran Inc., et al v. Government ofthe Islamic Republic

oflran, etal. (IUSCT Case Nos. 74,76,81,150), Award No. 311-74/76/81/150-3 of 14July 1987 [Michel Virally (pres.), Charles N. Brower, Parviz Ansari Moin] 703

[b] Phillips Petroleum Company Iran v. The Islamic Republic oflran and The National Iranian Oil Company (IUSCT Case No. 39), Award No. 425-39-2 of 29 June 1989 [Robert Briner (pres.), Seyed K. Khalilian, George H. Aldrich] 704

§ 8.03 Discriminatory Conduct: What is the Customary International Law Standard? 704 [A] BP Exploration Company (Libya) Limited v. The Government ofthe

Libyan Arab Republic, Award of 10 October 1973 and 1 August 1974, 53 Int'l L. Rep. 297,329,346-348,353-354 (1979) [Gunnar Lagergren (sole arbitrator)] 704

[B] A.F.M. Maniruzzaman, Expropriation of Alien Property and the Principle ofNon-Discrimination in International Law of Foreign Investment: An Overview, 8 J. Transnat'l L. & Pol'y 57-59,67-70 (1998) 707

[C] Comments and Questions 709 § 8.04 Arbitrary Conduct 709

[A] Responsibility ofthe State for Injuries Caused in Its Territory to the Person or Property of Aliens - Measures Aßecting Acquired Rights: Fourth Report by F. V. Garäa Amador, [1959] 2 Y.B. Int'l L. Comm'n 1,7-9, U.N. Doc. A/CN.4/119 709

[B] Glamis Gold, Ltd. v. United States of America (ad hoc arbitration under the 1976 UNCITRAL Rules), Award of 8 June 2009 [Michael K. Young, (pres.), David D. Caron, Kenneth D. Hubbard] 712

[C] Comments and Questions 714

xxxv


§ 8.05 DenialofJustice [A] The Loewen Group, Inc. and Raymond L. Loewen v. United States of

America (ICSID Case No. ARB/(AF)/98/3), Award of 26 June 2003 [Anthony Mason (pres.), Abner J. Mikva, Michael Mustill] 714

[B] Mondev International Ltd. v. United States of America (ICSID Case No. ARB(AF)/99/2), Award of 11 October 2002 [Ninian Stephen (pres.), James Crawford, Stephen M. Schwebel] 71 *

[C] AmcoAsia Corporation and others v. Republic oflndonesia (ICSID Case No. ARB/81/1), Award of 5 June 1990,1 ICSID Rep. 569, 602-605 (1993) [Rosalyn Higgins (pres.), Marc Lalonde, Per Magid] 722

[D] Athanassoglou and Others v. Switzerland Judgment of European Court of Human Rights of 6 April 2000, Application No. 27644/95, ECHR 2000-IV 725

[E] Robert Azinian, Kenneth Davitian and Ellen Baca v. The United Mexican States (ICSID Case No. ARB(AF)/97/2), Award of 1 November 1999 [Jan Paulsson (pres.), Benjamin R. Civiletti, Claus von Wobeser] 727

[F] Comments and Questions 731 § 8.06 Abuse of Rights 732

[A] Responsibility ofthe State for Injuries Caused in Its Territory to the Person or Property of Aliens - Measures Affecting Acquired Rights: Fourth Report by F.V. Garcia Amador, [1959] 2 Y.B. Int'l L. Comm'n 1, U.N. Doc. A/ CN.4/119 732

[B] Karl-Heinz Böckstiegel, Arbitration and State Enterprises: A Survey on the National and Internatioanl State of Law and Practice, 45-46 (Kluwer Law International 1984) 732

[C] International Law Commission (ILC) Articles on State Responsibility (2001) 733

§ 8.07 Unjust Enrichment 733 [A] Christoph H. Schreuer, Unjustified Enrichment in International Law, 22

Am.J. Comp. L. 281,281,284-285,289, 300-301(1974) 733 [B] International Law Commission (ILC) Articles on State Responsibility

(2001) 734 [C] Factory at Chorzow (Germany v. Poland), Claim No. 13 (PCA),

Judgment on the Merits of 13 September 1928, [1928] P.C.I.J. Series A-No. 17,47(1928) 735

[D] Arthur Nussbaum, The Arbitration Between the Lena Goldfelds, Ltd. and the Soviet Government, 36 CornellL. Q. 31, 50-51 (1950-1951) 735

[E] Sea-Land Service, Inc. v. The Islamic Republic oflran and Ports and Shipping Organization oflran (IUSCT Case No. 33), Award No. 135-33-1 of 22 June 1984 [Gunnar Lagergren (pres.), MahmoudM. Kashani, Howard M. Holtzmann] 736

[F] Flexi-Van Leasing, Inc. v. The Government ofthe Islamic Republic of Iran (IUSCT Case No. 36), Award No. 259-36-1 of 13 October 1986 [Gunnar Lagergren (pres.), Koorosh-Hossein Ameli, Howard M. Holtzmann]

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[G] Schlegel Corporation on behalf of Schiegal Linign Technology GmbH v. National Iranian Copper Industries Company (IUSCT Case No. 834), Award No. 295-834-2 of 27 March 1987 [Robert Briner (pres.), George H. Aldrich, Hamid Bahrami-Ahmadi] 741

[H] Lockheed Corporation v. The Government oflran, The Ministry ofWar & The Iranian Air Force (IUSCT Case No. 829), Award No. 367-829-2 of 9 June 1988 [Robert Briner (pres.), George H. Aldrich, Seyed K. Khalilian] 744

[I] Beyeler v. Italy, Judgment of the European Court of Human Rights of 5 January 2000, Application No. 33202/96, ECHR 2000-157 745

[j] Mobil Oil Iran Inc., et al. v. Government ofthe Islamic Republic oflran & National Iranian Oil Company (IUSCT Case Nos. 74,76,81,150), Award No. 311-74/76/81/150-3 of 14July 1987 [Michel Virally (pres.), Charles N. Brower, Parviz Ansari Moin] 746

[K] Arnco Asia Corporation and others v. Republic oflndonesia (ICSID Case No. ARB/81/1), Award of 5 June 1990,1 ICSID Rep. 569,607-608 (1993) [Rosalyn Higgins (pres.), Marc Lalonde, Per Magid] 746

[L] Charles N. Brower and Jason D. Brueschke, The Iran-United States Claims Tribunal 427-430 (Martinus Nijhoff Publishers 1998) 747

[M] Comments and Questions 748 § 8.08 Unlawful Interference 748

[A] Eastman Kodak Company and others v. The Government oflran and others (IUSCT Case No. 227) and Eastman Kodak International Capital Company, Incorporated, a claim ofless than U.S. $250,000presented by the Government ofthe United States of America v. The Islamic Republic oflran (IUSCT Case No. 12384), Award No. 329-227/12384-3 of 11 November 1987 [Michel Virally (pres.), Charles N. Brower, Parviz Ansari Moin] 749

[B] Comments and Questions 752

Chapter 9 Violation of Investor Rights under Investment Treaties 753 § 9.01 Introduction 753 § 9.02 Absolute Standards 756

[A] Fair & Equitable Treatment 756 [1] US Model Bilateral Investment Treaty (2012), Article 2(2)(a) 756 [2] North American Free Trade Agreement (1993), Article 1105(1) 756 [3] Energy Charter Treaty (1994), Article 10(l) 757 [4] Rudolf Dolzer and Christoph H. Schreuer, Principles of

International Investment Law, 132,134,136-17,139-140 (2nd ed., Oxford University Press 2012) 757

[5] BIT Cases 759 [a] Tecnicas Medioambientales Tecmed, S.A. v. The United Mexican

States (ICSID Case No. ARB (AF)/00/2), Award of 29 May

xxxvii


2003,99 153-157,165-167,172-174 [Horacio A. Grigera Naon (pres.), Jose Carlos Fernandez Rozas, Carlos Bernal Verea] 759

[b] Saluka Investments BV. v. The Czech Republic (ad hoc arbitration under the 1976 UNCITRAL Rules), Partial Award of 17 March 2006, 99 297-309 [Arthur Watts (pres.), L. Yves Fortier, Peter Behrens] 763

[c] El Paso Energy International Company v. The Argentine Republic (ICSID Case No. ARB/03/15), Award of 31 October 2011, gg 355,364-377,512-519 [Lucius Caflisch (pres.), Brigitte Stern, Piero Bernardini] 7 66

[d] Parkerings-Compagniet AS v. Republic ofLithuania (ICSID Case No. ARB/05/8), Award of 11 September 2007, 99 330-338 [Laurent Levy (pres.), Julian Lew, Marc Lalonde] 770

[6] NAFTA Cases 771 [a] NAFTA Free Trade Commission, Notes of Interpretation of

Certain Chapter 11 Provisions, 2 (2001) 771 [b] Waste Management, Inc. v. United Mexican States ('Number

2') (ICSID Case No.ARB(AF)/00/3), Award of 25 June 2003,99 91-93,98-99 [James R. Crawford (pres.), Benjamin R. Civilette, Eduardo Magallön Gömez] 772

[c] Glamis Gold, Ltd. v. United States of America (ICSID Administered Case), Award of 8 June 2009,99 598-609,611-615, 617-621,625-627 [Michael K. Young, David D. Caron, Kenneth D. Hubbard] 774

[d] Merrill & Ring Forestry L,P. v. Canada (ICSID Administered Case), Award of31 March 2010, 99 190-197,201, 204-207, 209-213 [Francisco Orrego Vicuna (pres.), Kenneth W. Dam, J. William Rowley] 778

[7] Comments and Questions 782 [B] Füll Protection & Security 785

[ 1 ] Rudolf Dolzer and Christoph H. Schreuer, Principles of International Investment Law, 160-162 (2nd ed., Oxford University Press 2012) 735

[2] Elettronica Sicula S.p.A. (ELSI) (United States of America v. Italy), Judgment of 20 July 1989, [1989] I.C.J. Rep. 15, 89-93 (1989), 99 104-105,107-108 786

[3] Asian Agricultural Products Ltd. v. Republic ofSri Lanka (ICSID Case No. ARB/87/3), Final Award of 27 June 1990,4 ICSID Rep. 246 (1997), 99 45-49, 53,72-73,75-77, 85-86 [Ahmed Sadek El-Kosheri (pres.), Berthold Goldman, Samuel K.B. Asante] 788

[4] Azurix Corp. v. Argentine Republic (ICSID Case No. ARB/01/12), Award of 14 July 2006, 99 406-408 [Andres Rigo Sureda (pres.), Marc Lalonde, Daniel Hugo Martins] 793

[5] Comments and Questions 794 [C] Treatment No Less Favorable than that Required by International Law 795

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[1] KennethJ. Vandevelde, United States Investment Treaties: Policy and Practice, 77-78 (Kluwer Law International 1992) 795

[2] L.F.H. Neer and Pauline E. Neer v. Mexico (General Claims Commission - United States and Mexico), Opinion Rendered 15 October 1926,21 Am. J. Int'l L. 555,556,559-560 (1927) [General Claims Commission; Concurring Opinion by Fred K. Nielsen] 795

[3] Mondev International Ltd. v. United States of America (ICSID Case No. ARB (AF)/99/2), Award of 11 October 2002, 99 110-117, 119-125 [Ninian Stephen (pres.), James R. Crawford, Stephen M. Schwebel] 796

[4] Comments and Questions 800 [D] Arbitrary Treatment 800

[1] US Model Bilateral Investment Treaty (2012), Article 2(2)(b) 800 [2] Elettronica Sicula S.p.A. (ELSI) (United States of America v. Italy),

Judgment of20July 1989, [1989] I.C.J. Rep. 15,89-93 (1989), 99 120-121,123-124,127-130 801

[3] Ronald S. Lauder v. The Czech Republic (ad hoc arbitration under the 1976 UNCITRAL Rules), Final Award of 3 September 2001, 99 214,219,221-222,225-228,229-230,232 [Robert Briner (pres.), Lloyd Cutler, Bohuslav Klein] 803

[4] Azurix Corp. v. Argentine Republic (ICSID Case No. ARB/01/12), Award of 14 July 2006,99 390-393 [Andres Rigo Sureda (pres.), Marc Lalonde, Daniel Hugo Martins] 805

[5] Comments and Questions 806 [E] Discrimination 807

[1] North American Free Trade Agreement (1993), Article 1104 807 [2] A.F.M. Maniruzzaman, Expropriation of Alien Property and the

Principle ofNon-Discrimination in International Law of Foreign Investment: An Overview, 8 J. Transnat'l L. & Pol'y 57,58-59,61-65,67-70,72,77(1998) 807

[3] Amoco International Finance Corporation v. The Government ofthe Islamic Republic oflran (IUSCT Case No. 56), Partial Award of 14July 1987 [Michel Virally (pres.), Charles N. Brower, Parviz Ansari Moin] 811

[4] Nykomb Synergetics Technology Holding AB v. The Republic ofLatvia (SCC Case No. 118/2001), Award of 16 December 2003, [2003] HC 182, § 4.3.2(1) at 34 (2003) 812

[5] Comments and Questions 813 [F] Umbrella Clause 814

[1] US Model Bilateral Investment Treaty (2012), Article 2(2) (c) 814 [2] Anthony C. Sinclair, The Origins ofthe Umbrella Clause in the

International Law of Investment Protection, 20(4) Arb. Int'l 411, 411-434 (2004) 814

xxxix


[3] OECD, Working Paper No. 2006/3: Interpretation ofthe Umbrella Clause in Investment Agreements, 7-9 (OECD, 2006) 816

[4] James R. Crawford, Treaty and Contract in Investment Arbitration: The 22nd Freshfields Lecture on International Arbitration, London (29 November 2007), 6( l) Transnational Dispute Management 18-21 (2009) 817

[5] Eureko BV. v. Republic ofPoland (ad hoc arbitration under the 1976 UNCITRAL Rules), Partial Award of 19 August 2005, 99 246 [L. Yves Fortier (pres.), Stephen M. Schwebel, Jerzy Rajski] 819

[6] SGS Societe Generale de Surveillance v. Republic ofthe Philippines (ICSID Case No. ARB/02/6), Decision ofthe Tribunal on Objections to Jurisdiction of 29 January 2004,99 H3,115-128, 130-131,134-135,137-138,141,143,154 [Ahmed S. El-Kosheri (pres.), James R. Crawford, Antonio Crivellaro] 819

[7] LG&E Energy Corp., LG&E Capital Corp. and LG&E International Inc. v. Argentine Republic (ICSID Case No. ARB/02/1), Decision on Liability of 3 October 2006,99 171-172,174-175 [TatianaB. de Maekelt (pres.), Francisco Rezek, Albert Jan van den Berg] 825

[8] El Paso Energy International Company v. Argentine Republic (ICSID Case No. ARB/03/15), Decision on Jurisdiction of 27 April 2006, 99 70,79,81-82, 84 [Lucius Caflisch (pres.), Brigitte Stern, Piero Bernardini] 826

[9] Burlington Resources Inc. v. Republic of Ecuador, ICSID Case No. ARB/08/5 (formerly Burlington Resources Inc. and others v. Republic of Ecuador and Empresa Estatal Petroleos del Ecuador (PetroEcuador)) (ICSID Case No. ARB/08/5), Decision on Liability of 14 December 2012,99 211,214-218,220 [Gabrielle Kaufmann-Köhler (pres.), Brigitte Stern, Francisco Orrego Vicuna] 828

[10] Comments and Questions 829 [G] Expropriation 831

[1] U§ Model Bilateral Investment Treaty (2012), Article 3 831 [2] North American Free Trade Agreement (1993), Article 1110 832 [3] Energy Charter Treaty (1994), Article 13 833 [4] OECD, Working Paper No. 2004/4: 'Indirect Expropriation' and the

'Right to Regulate in International Investment Law, 3-5, 22 (OECD 2004) 8)4

[5] Ursula Kriebaum, Partial Expropriation, 8 (1) J. of World Inv. and Trade 69,83-84 (2007) 835

[6] Phillips Petroleum Company Iran v. The Islamic Republic oflran & The National Iranian Oil Company (IUSCT Case No. 39), Award of 29June 1989 [Robert Briner (pres.), Seyed K. Khalilian, George H. Aldrich] 8

[7] Pope & Talbot Inc. v. The Government ofCanada (ad hoc arbitration under the 1976 UNCITRAL Rules), Interim Award of 26 June

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2000,99 96-105 [Lord Dervaird (pres.), BenjaminJ. Greenberg, Murray J. Belman] 842

[8] Waste Management, Inc. v. United Mexican States ('Number 2') (ICSID Case No. ARB(AF)/00/3), Award of 25 June 2003, 99 143-145,159-162,177 [James R. Crawford (pres.), Benjamin R. Civilette, Eduardo Magallön Gömez] 844

[9] GAMI Investments, Inc. v. The Government ofthe United Mexican States (ad hoc arbitration under the 1976 UNCITRAL Rules), Final Award of 12 November 2004,99 116,123,126-133 [W. Michael Reisman, Julio Lacarte Muro, Jan Paulsson] 846

[ 10] Compania deAguas del Aconquija S.A. and Vivendi Universal (formerly Compagnie Generale Des Eaux) v. Argentine Republic (ICSID Case No. ARB/97/3), Award of 20 August 2007,99 7.5.3-7.5.4,7.5.8,7.5.10-7.5.11,7.5.17-7.5.21,7.5.24-7.5.30, 7.5.31, 7.5.33-7.5.34 [J. William Rowley (pres.), Gabrielle Kaufmann-Kohler, Carlos Bemal Verea] 848

[ 11 ] Burlington Resources Inc. v. Republic of Ecuador, ICSID Case No. ARB/08/5 (formerly Burlington Resources Inc. and others v. Republic of Ecuador and Empresa Estatal Petröleos del Ecuador (PetroEcuador)) (ICSID Case No. ARB/08/5), Decision on Liability of 14 December 2012,99 344-345,391-404,429-430, 448-449,454-456,537-540 [Gabrielle Kaufmann-Kohler (pres.), Brigitte Stern, Francisco Orrego Vicuna] 852

[12] Comments and Questions 856 [H] Effective Means of Enforcing Rights 858

[1] Chevron Corporation (USA) and Texaco Petroleum Company (USA) v. The Republic of Ecuador (PCA Case No. 34877), Partial Award on the Merits of 30 March 2010,99 241-248,250-257, 262-264,268-270 [Karl-Heinz Böckstiegel (pres.), Charles N. Brower, Albert Jan van den Berg] 858

[2] Questions and Comments 862 § 9.03 Relative Standards 863

[A] National Treatment 863 [1] US Model Bilateral Investment Treaty (2012), Article 3 863 [2] North American Free Trade Agreement (1993), Article 1102 864 [3] Energy Charter Treaty (1994), Articles 10(2), 10(3), 10(7) and

10(10) 864 [4] UNCTAD, National Treatment, UNCTAD Series on Issues in

International Investment Agreements, 1-2,12,25-26,33 (United Nations Publications 1999) 865

[5] S.D. Myers, Inc. v. Government ofCanada (ad hoc arbitration under the 1976 UNCITRAL Rules), Partial Award of 13 November 2000,99 238,240-256 [Bryan P. Schwartz, Edward C. Chiasson, J. Martin Hunter] 867

xli


[6] Archer Daniels Midland Company and Täte & Lyle Ingredients Americas, Inc. v. The United Mexican States (ICSID Case No. ARB(AF)/04/05), Award of 21 November 2007, 99 197-213 [Bernardo M. Cremades (pres.), Arthur W. Rovine, Eduardo Siqueiros T.] 8^0

[7] Merrill & RingForestry L.P. v. Canada (ICSID Administered Case), Award of 31 March 2010, «ff 86-94 [Francisco Orrego Vicuna (pres.), Kenneth W. Dam, J. William Rowley] 874

[8] Comments and Questions 876 [B] Most-Favored-Nation Treatment 877

[1] US Model Bilateral Investment Treaty (2012), Article 4 877 [2] North American Free Trade Agreement (1993), Article 1103 877 [3] UNCTAD, Bilateral Investment Treaties in the Mid-1990s, 58, 61-

62 (United Nations Publications 1998) 877 [4] Rudolf Dolzer and Margrete Stevens, Bilateral Investment Treaties,

66 (Kluwer Law International 1995) 879 [5] Emilio Agustin Maffezini v. The Kingdom ofSpain (ICSID Case

No. ARB/97/7), Decision on Jurisdiction of 25 January 2000, 16 ICSID Rev. - Foreign Int'l L.J. 212,225-236 (2001) [Francisco Orrego Vicuna (pres.), Thomas Buergenthal, Maurice Wolf] 879

[6] Plama Consortium Limited v. Republic ofBulgaria (ICSID Case No. ARB/03/24), Decision on Jurisdiction of 8 February 2005, H 184,186-187,189-192,198-200,203-210,212,218-219,222-224,227 [Carl F. Salans (pres.), Albert Jan van den Berg, W. Veeder] 885

[7] Impregilo S.p.A. v. Argentine Republic (ICSID Case No. ARB/07/17), Final Award of 21 June 2011 - Prof. Bridgette Sterns Concurring and Dissenting Opinion, 99 16-17,45,47-53, 57-58,61,67, 70, 78-80 [Hans Danelius (pres.), Charles N. Brower, Brigette Stern] 889

[8] UNCTAD, Most-Favoured-Nation Treatment, UNCTAD Series on Issues in International Investment Agreements II, 66-67, 82-85 (United Nations Publications 2010) 893 Table 1. Summary ofMFN claims 894


Chapter 10 Defense« § 10.01 Introduction § 10.02 Force Majeure gng

[A] National Oil Corporation (Libya) v. Libyan Sun Oil Company (USA) (ICC Case No. 4462/A5), First Award of 31 May 1985,291.L.M. 565, 584-588 (1990) [Edmund Muskie, Hein Kotz, Robert Schmelck] 898

[B] Comments and Questions

xlii

897 897

Table of Contents

[C] Gould Marketing, Inc. v. Ministry of National Defense oflran (IUSCT Case No. 49), Interlocutory Award of 27 July 1983 [Pierre Bellet (pres.), George H. Aldrich, Shafie Shafeiei] 901

[D] Amoco International Finance Corporation v. The Government ofthe Islamic Republic oflran (IUSCT Case No. 56), Partial Award of 14 July 1987 [Michel Virally (pres.), Charles N. Brower, Parviz Ansari Moin] 902

[E] Comments and Questions 904 [F] Phillips Petroleum Company Iran v. The Islamic Republic oflran & The

National Iranian Oil Company (IUSCT Case No. 39), Award of 29 June 1989 [Robert Briner (pres.), Seyed K. Khalilian, George H. Aldrich] 904

[G] Comments and Questions 906 [H] International Law Commission, Articles on Responsibility of States

for Internationally WrongfulActs, November 2001, Article 23 and Commentary, [2001] 2(2) Y. B. Int'l L. Comm'n 30,76-78 907

[I] Comments and Questions 910 [J] UNIDROIT Principles of International Commercial Contracts

(2010), Article 7.1.7 910 [K] James R. Crawford and Anthony Sinclair, The UNIDROIT Principles

of International Commercial Contracts and their Application to State Contracts, ICC Bulletin - Special Supplement 57,57-75 (2002) 910

[L] Comments and Questions 915 § 10.03 Coercion and Duress 916

[A] Detlev F. Vagts, Coercion and Foreign Investment Rearrangements, 72 Am. J: Int'l. L. 17,17-19,33-36 (1978) 916

[B] Comments and Questions 919 [C] International Law Commission, Articles on Responsibility of States for

Internationally WrongfulActs, Article 18 and Commentary, [2001] 2(2) Y.B. Int'l L. Comm'n 30,69-70 (2001) 919

[D] Comments and Questions 921 [E] UNIDROIT Principles of International Commercial Contracts

(2004), Article 3.9 921 [F] Government of Kuwait v. American Independent Oil Company

(AMINOIL), Award of 24 March 1982,66 Int'l L. Rep. 518,569-571, 615-616 (1982) [Paul Reuter (pres.), Hamed Sultan, Gerald Fitzmaurice] 922

[G] Comments and Questions 924 § 10.04 Necessity 924

[A] Case Concerning the Gabäkovo-Nagymaros Project (Hungary v. Slovakia), Judgment of25 September 1997, [1997] ICJ Rep. 7,39-46, 58,63(1997) 924

[B] International Law Commission, Articles on Responsibility of States for Internationally WrongfulActs, Article 25 and Commentary, [2001] 2(2) Y.B. Int'l L. Comm'n 30,80-84 (2001) 929

[C] Comments and Questions 932 [D] LG&E Energy Corp., LG&E Capital Corp. 6" LG&E International, Inc. v.

Argentine Republic (ICSID Case No. ARB/02/1), Decision on Liability

xliii


of 3 October 2006, 21 ICSID Rev. - Foreign Int'l L.J. 269 (2006) [Tatiana B. de Maekelt (pres.), Francisco Rezek, Albert Jan van den Berg] 933

[E] CMS Gas Transmission Company v. Argentine Republic (ICSID Case No. ARB/01/8), Decision on Annulment of 25 September 2007,14 ICSID Rep. 251,270-271,274-277 (2009) [Gilbert Guillaume (pres.), Nabil Elaraby, James R. Crawford] 935

[F] National Grid PLC v. Argentine Republic, Award of 3 November 2008 [Alejandro Miguel Garro (pres.), Judd L. Kessler, Andres Rigo Sureda] 938

§ 10.05 Corruption 939 [A] OECD Convention on Combating Bribery of Foreign Public Officials

in International Business Transactions (1997), 37I.L.M. 1 (1998) 940 [B] Argentine Engineer v. British Company (ICC Case No. 1110), Award of

1963,21 Y.B. Cornm'l Arb. 47,50-51 (1996) [Gunnar Lagergren (sole arbitrator)] 943

[C] J. Gillis Wetter, Issues of Corruption before International Arbitral Tribunals: TheAuthentic Textand TrueMeaningofJudge Gunnar Lagergren's 1963 Award in ICC CaseNo. 1110,10 Arb. Int'l 277, 277-281 (1994) 945

[D] Comments and Questions 948 [E] Establishment ofMiddle East Country X v. South Asian Construction

Company (ICC Case No. 4145), Award of 1984,12 Y.B. Cornm'l Arb 97,102-103 (1987) 948

[F] Comments and Questions 950 [G] Brokerv. Contractor (ICC CaseNo 5622), Final Award of 1988, 19 Y.B.

Cornm'l Arb. 105,110-115 (1994) 950 [H] Comments and Questions 953 [I] Partner v. 4 Partners (ICC Case No. 6286), Partial Award of 28 August

1991,19 Y.B. Cornm'l Arb. 141,149-150 (1994) 953 [J] Comments and Questions 954 [K] Tanzania Electric Supply Company Limited v. Independent Power

Tanzania Limited (ICSID Case No. ARB/98/8), Decision on Tariff and Other Remaining Issues of 9 February 2001,8 ICSID Rep. 272, 282-283 (2005) [Kenneth Rokison (pres.), Charles Brower, Andrew Rogers] 954

[L] Comments and Questions 955 [M] World Duty Free Company Limited v. Kenya (ICSID Case No.

ARB/00/7), Award of4 October 2006,461.L.M. 339, 366-368, 369-370,370-371(2007) 9#

[N] Comments and Questions 959 § 10.06 Fundamental Change of Circumstances (Rebus Sic Stantibus/Imprevision) 960

[A] UNIDROIT Principles of International Commercial Contracts (2004), Articles 6.2.1., 6.2.2. and 6.2.3 96I

[B] CMS Gas Transmission Company v. Argentine Republic (ICSID Case No. ARB/01/8), Award of 12 May 2005,14 ICSID Rep. 152,194-195

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(2009) [Francisco Orrego Vicuna (pres.), Marc Lalonde, Francisco Rezek] 961

[C] Comments and Questions 963

Chapter 11 Reparation« Recoverable by Foreign Investors in International Law 965 § 11.01 Introduction 965 § 11.02 Reparations Generally 966

[A] General Typesof Reparations 966 [ 1 ] UN International Law Commission (ILC) Articles on State

Responsibility (2001), Articles 31 and 34 966 [2] Harvard Draft Convention on State Responsibility, 55 Am. J. Int'l

L. 545,581 (1961) 966 [B] General Principle of Reparations 967

[1] Fadory at Chorzow (Germany v. Poland), Claim No. 13 (PCA), Judgment on the Merits of 13 September 1928, [1928] P.C.I.J. Series A - No. 17,47 (1928) 967

[C] Limits on Reparations 967 [ 1] UN International Law Commission (ILC) Articles on State

Responsibility (2001), Article 39 967 [2] Harvard Draft Convention on State Responsibility, 55 Am. J. Int'l

L. 545,581 (1961) 968 [3] James R. Crawford, State Responsibility: Third Report by the Special

Rapporteur in International Responsibility, UN Doc. A/CN.4/507, 99161-163 968

[4] F.V. Garcia Amador, The Changing Law of International Claims, Vol. II, 599-601 (Oceana Publications 1984) 968

[5] Bridas S.A.P.I.C., Bridas Energy International, Ltd., Intercontinental Oil & Gas Ventures, Ltd. and Bridas Corporation v. Government of Turkmenistan, Concern Balkannebitgazsenagat and State Concern Turkmenneft (ICC Case No. 9058/FMS/KGA), Third Partial Award of 2 September 2000,12-13 [Edward C. Chiasson, (pres.), Griffin B. Bell, Hans Smit] 970

[6] Occidental Petroleum Corporation and Occidental Exploration and Production Company v. The Republic of Ecuador (ICSID Case No. ARB/06/11), Award of 5 October 2012,99 662-666,669, 678-680,683-685,687 [L. Yves Fortier (pres.), David A.R. Williams, Brigitte Stern] 971

[7] Comments and Questions 974 § 11.03 Declaratory, Injunctive and Interim Relief 975

[A] UN International Law Commission (ILC) Articles on State Responsibility (2001), Articles 29 and 30 975

[B] US Model Bilateral Investment Treaty (2012), Articles 26 and 28 975 [C] James R. Crawford, State Responsibility: Third Report by the Special

Rapporteur in International Responsibility, UN Doc. A/CN.4/507,184 975

xlv


[D] F.V. GarcfaAmador, Ihe Changing Law of International Claims, Vol. II, 576-578,581-583 (Oceana Publications 1984)

[E] Christoph H. Schleuer, Loretta Malintoppi, August Reinisch and Anthony Sinclair, The ICSID Convention: A Commentary, 1136-1139 (2nd ed., Cambridge University Press 2009)

[F] Enron Corporation and Ponderosa Assets, L.P. v. Argentine Republic (ICSID Case No. ARB/01/3), Decision on Jurisdiction of 14January 2004,99 76-81 [Francisco Orrego Vicuna (pres.), Hector Gros Espiel, Pierre-Yves Tschanz]

[G] Sergei Paushok, CJSC Golden East Company and CJSCVostokneftegaz Company v. The Government of Mongolia (ad hoc arbitration under the 1976 UNCITRAL Rules), Order on Interim Measures of 2 September 2008,99 36-37,39,45-46, 55,68-71,79-85 [Marc Lalonde (pres.), Brigitte Stern, Horacio A. Grigera Naön]

[H] Quiborax SA., Non Metallic Minerals S.A. and Allan Fosk Kaplün v. Plurinational State ofBolivia (ICSID Case No. ARB/06/2), Decision on Provisional Measures of26 February 2010, 99 113-114,116-124, § V [Gabrielle Kaufmann-Kohler (pres.), Marc Lalonde, Brigitte Stern]

[I] Comments and Questions § 11.04 Compensation for Breach of Contract

[A] Harvard Draft Convention on State Responsibility, 55 Am. J. Int'l L. 545,581(1961)

[B] UNIDROIT Principles of International Commercial Contracts (2010), Articles 7.4.2-7.7.4.4,7.4.7-7.4.8,7.4.11, 7.4.13

[C] Bridas S.A.P.I.C., Bridas Energy International, Ltd., Intercontinental Oil & Gas Ventures, Ltd. and Bridas Corporation v. Government of Turkmenistan, Concern Balkannebitgazsenagat and State Concern Turkmenneft (ICC Case No. 9058/FMS/KGA), Partial Award of 25 June 1999,23-29 [Edward C. Chaisson (pres.), Hans Smit, Griffin B. Bell]

[D] Karaha Bodas Company L.L.C. v. Perusahaan Pertambangan Minyak Dan Gas Bumi Negara ('Pertamina') and Pt. PLN (Persero) ('PLN') (ad hoc arbitration under the 1976 UNCITRAL Rules), Final Award of 18 December 2000), 16(3) Mealey's Int'l Arb. Rep. C-2, C-15 to C-16, 99 121-122,124-127,134-136 (2001) [Yves Derains (pres.), Piero Bernardini, Ahmed Sadek El Kosheii]

[E] Comments and Questions § 11.05 Restitution and Compensation for Treaty Violations and Unlawful Conduct

[A] UN International Law Commission (ILC) Articles on State Responsibility (2001), Articles 35 and 36

[B] Harvard Draft Convention on State Responsibility, 55 Am. J. Int'l L 545,581(1961)

[C] R. Doak Bishop, Theories of State Responsibility in International Law: Expropriation and Fair and Equitable Treatment, 58 Proceedings ofthe Arnual Institute on Oil and Gas Law, 203,286-287 (2007)

976

977

978

980

983 985 989

989

989

991

993 995 996

996

997

997

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[D] Factory at Chorzow (Germany v. Poland), Claim No. 13 (PCA), Judgment ontheMerits of 13 September 1928, [1928] P.C.I.J. Series A-No. 17,27-29,31,46-54(1928) 998

[E] BG Group Plc. v. The Republic of Argentina (ad hoc arbitration under the 1976 UNCITRAL Rules), Final Award of 24 December 2007,99 419, 422,426-429,444 [Guillermo Aguilar Alvarez (pres.), Alejandro M. Garro, Albert Jan van den Berg] 1003

[F] Azurix Corp. v. The Argentine Republic (ICSID Case No. ARB/01/12), Decision on the Application for Annulment of 1 September 2009,99 316-328 [Gavan Griffith (pres.), Bola Ajbola, Michael Hwang] 1005

[G] Occidental Petroleum Corporation and Occidental Exploration and Production Company v. The Republic of Ecuador (ICSID Case No. ARB/06/11), Award of 5 October 2012,99 707-709,790-797,824-825 [L. Yves Fortier (pres.), David A.R. Williams, Brigitte Stern] 1007

[H] Comments and Questions 1009 § 11.06 Restitution and Compensation for Expropriation 1010

[A] Introduction 1010 [B] Restitutio in Integrum and Specific Performance 1011

[ l] J. Gillis Wetter and Stephen M. Schwebel, Some Little-Known Cases on Concessions, [1964] Brit. Y.B. Int'l L. 183,220-22 (1966) 1011

[2] Texaco Overseas Petroleum Company and California Asiatic Oil Company v. The Government ofthe Libyan Arab Republic, Award of 19 January 1977,171.L.M. 3,31-37 (1978) [Rene-Jean Dupuy, sole arbitrator] 1012

[3] Occidental Petroleum Corporation and Occidental Exploration and Production Company v. The Republic of Ecuador (ICSID Case No. ARB/06/11), Decision on Provisional Measures of 17 August 2007,99 67-69,72-76,79,82,84-86 [L. Yves Fortier (pres.), David A.R. Wilhams, Brigitte Stern] 1015

[4] Comments and Questions 1018 [C] Whatis the Standard of Compensation for an Expropriation? 1018

[1] US Model Bilateral Investment Treaty (2012), Article 6 1018 [2] Brice M. Clagett, Just Compensation in International Law: The Issues

Before the Iran-United States Claims Tribunal, in The Valuation of Nationalized Property in International Law, Vol. IV, 31-33,96-97 (Richard B. Lillich (ed.), University Press ofVirginia 1987) 1019

[3] World Bank Guidelines on the Treatment of Foreign Direct Investment, 311.L.M. 1363,1379,1382-84 (1992) 1020

[4] Government of Kuwait v. American Independent Oil Co. (AMINOIL), Final Award of 24 March 1982,66 Int'l L. Rep. 518 (1982) [Paul Reuter (pres.), Hamed Sultan, Gerald Fitzmaurice] 1022

[5] Phillips Petroleum Company Iran v. The Islamic Republic oflran & The National Iranian Oil Company (IUSCT CaseNo. 39), Award of 29 June 1989 [Robert Briner (pres.), Seyed K. Khalilian, George H. Aldrich] 1026

xlvii


[6] CME Czech Republic BV. v. The Czech Republic (ad hoc arbitration under the 1976 UNCITRAL Rules), Final Award of 14 March 2003, 9? 496-498,500-502 [Wolfgang Kühn (pres.), Stephen M. Schwebel, Ian Brownlie] 1 ̂ 29

[7] Comments and Questions 1030 [D] Restitution and Compensation for Unlawful Expropriations 1031

[ 1 ] Amoco International Finance Corp. v. Government of the Islamic Republic oflran (IUSCT Case No. 56), Partial Award No. 310-56-3 of 14 July 1987 [Michel Virally (pres.), Charles N. Brower, Parviz Ansari Moin] 1031

[2] ADCAffiliate Limited and ADC&ADMC Management Ltd. v. The Republic ofHungary (ICSID Case No. ARB/03/16), Award of 2 October 2006,99 480-486,494-497,499 [Charles N. Brower (pres.), Albert Jan van den Berg, Neil Kaplan QC] 1035

[3] Questions and Comments 1038 [E] Date of Valuation for Expropriation 1039

[ 1] W. Michael Reisman and Robert D. Sloane, IndirectExpropriation and Its Valuation in the BIT Generation, 74 Brit. Y.B. Int'l L., 36-37, 38-39,41,46-47,50-51 (2003) 1039

[2] Phillips Petroleum Company Iran v. The Islamic Republic oflran & The National Iranian Oil Company (IUSCT Case No. 39), Award of 29 June 1989 [Robert Briner (pres.), SeyedK. Khalilian, George H. Aldrich] 1041

[3] Compania del Desarrollo de Santa Elena S.A. v. Costa Rica (ICSID Case No. ARB/96/1), Final Award of 17 February 2000,39 I.L.M 1317,1329-1332 (2000), 73-74,76-78, 80-81, 83-84, 90, 93-95 [L. Yves Fortier (pres.), Elihu Lauterpacht, Prosper Weil] 1043

[4] Comments and Questions 1045 111.07 Compensation for Denial of Justice 1046

[A] Chevron Corp (USA) and Texaco Petroleum Co (USA) v. Republic of Ecuador (PCA Case No. 34877), Partial Award on the Merits of 30 March 2010,99 374-379,381-382,384, 546 [Karl-Heinz Böckstiegel (pres.), Charles N. Brower, Albert Jan van den Berg] 1046

[B] Comments and Questions 1049 111.08 Methodologies for Väluing Losses 1049

[A] Generally 1049

[1] Paul D. Friedland and Eleanor Wong, MeasuringDamagesfor the Deprivation of Income-Producing Assets: ICSID Case Studies, 6 ICSID Rev. - Foreign Inv. L.J. 400,405-407 (1991) 1049

[2] Brice M. Clagett, Just Compensation in International Law: The Issues Before the Iran-United States Claims Tribunal, in The Valuation of Nationalized Property in International Law, Vol. IV, 48-51 (Richard B. Lillich (ed.), University Press ofVirginia 1987) 1051

[B] Valuation Methods [1] DiscountedCashFlow (DCF) Method IO53

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Table of Contents

[a] Mark Kantor, Valuation for Arbitration: Compensation Standards, Valuation Methods and Expert Evidence, 131-134, 139 (Kluwer Law International 2008) 1053

[b] Phillips Petroleum Company Iran v. The Islamic Republic of Iran & The National Iranian Oil Company (IUSCT Case No. 39), Award of 29 June 1989 [Robert Briner (pres.), Seyed K. Khalilian, George H. Aldrich] 1055

[c] CMS Gas Transmission Company v. Argentina Republic (ICSID Case No. ARB/01/8), Award of 12 May 2005,9? 411-417 [Francisco Orrego Vicuna (pres.), Marc Lalonde, Francisco Rezek] 1056

[d] Rumeli Telekom A.S. and Telsim Mobil Telekomunikasyon HizmetleriA.S. v. Republic ofKazakhstan (ICSID Case No. ARB/05/16), Award of 29 July 2008, 99 793,801,804, 810-811,813-814 [Bernard Hanotiau (pres.), Steward Boyd, Marc Lalonde] 1057

[e] Comments and Questions 1059 [2] Comparable Sales or Transactions 1060

[a] loannis Kardassopoulos and Ron Fuchs v. Republic of Georgia (ICSID Case Nos. ARB/05/18 and ARB/07/15), Award of 3 March 2010,99 594-595,598-600,603 [L. Yves Fortier (pres.), Francisco Orrego Vicuna, Vaughan Lowe] 1060

[3] Comments and Questions 1061 [C] Using Alternative Valuation Methods 1062

[ 1 ] Charles N. Brower and Jason D. Brueschke, The Iran-United States Claims Tribunal, 588-589 (Kluwer Law International 1998) 1062

[2] Compania de Aguas del Aconquija SA. and Vivendi Universal (formerly Compagnie Generale Des Eaux) v. Argentine Republic (ICSID Case No. ARB/97/3), Award of 20 August 2007,99 8.1.3-8.1.5, 8.3.3-8.3.5,8.3.12-8.3.13 [J. William Rowley (pres.), Gabrielle Kaufmann-Köhler, Carlos Bemal Verea] 1063

[3] Comments and Questions 1064 §11.09 Compensation of Shareholders' Interests 1065

[A] Sergey Ripinsky with Kevin Williams, Damages in International Investment Law, 161 (BIICL 2008) 1065

[B] Asian Agricultural Products Ltd. v. Republic ofSri Lanka (ICSID Case No. ARB/87/3), Final Award of 27 June 1990,99 87-88,95-101,103-104,106-108 [Ahmed SadekEl-Kosheri (pres.), Berthold Goldman, R. Samuel K.B. As ante] 1065

[C] Comments and Questions 1068 § 11.10 Moral orPunitive Damages 1069

[A] Desert Line Projects LLC v. The Republic ofYemen (ICSID Case No. ARB/05/17), Award of 2 February 2008,99 289,291 [Pierre Tercier (pres.), Jan Paulsson, Ahmed S. EI-Kosheri] 1069

xlix

[B] mgwik EÜe George Siag W Ckriwia VWii v. Egypt (ICSID Case No. ARB/OS/15), Award of 1 June 2009,99 544-545 [David A.R. Williams (pres.), Michael Pryles, Francisco Orrego Vicuna]

§ 11.11 Currency and Exchange Rate [A] US Model Bilateral Investment Treaty (2012), Article 6 [B] Arbitration ofLighthouses (France v. Greece), Claims No. 11 and 4

(PCA), Award of 24July 1956,23 I.L.R. 81, 299 (1956) [Jan Hendrik Willem Verzijl (pres.), Achille Mestre, Georges Charbouris]

[C] Siemens A.G. v. The Argentine Republic (ICSID Case No. ARB/02/8), Award of 6 February 2007, <f 361 [Andres Rigo Sureda (pres.), Charles N. Brower, Domingo Bello Janeiro]

§11.12 Compound Interest [A] James R. Crawford, State Responsibility: Third Report by the Special

Rapporteur in International Responsibility, UN Doc. A/CN.4/507, 99 207-208,211

[B] Frederick Alexander Mann, Compound Interest as an Item of Damage in International Law, in Further Studies in International Law, 377-378, 383-385 (Frederick Alexander Mann (ed.), Clarendon Press 1990)

[C] Compania del Desarrollo de Santa Elena S.A. v. Costa Rica (ICSID Case No. ARB/96/1), Final Award of 17 February 2000,39 I.L.M 1317, 1332-1334 (2000), 96-107 [L. Yves Fortier (pres.), Elihu Lauterpacht, Prosper Weil]

[D] Compania deAguas delAconquija S.A. and Vivendi Universal (formerly Compagnie Generale Des Eaux) v. Argentine Republic (ICSID Case No. ARB/97/3), Award of 20 August 2007, ̂ 9.2.1,9.2.3-9.2.6,9.2.8 [J. William Rowley (pres.), Gabrielle Kaufmann-Kohler, Carlos Bernal Verea]

[E] Comments and Questions § 11.13 Costs

[A] Susan D. Franck, Rationalizing Costs in Investment Treaty Arbitration, 88 Wash. U.L. Rev. 769 (2011)

[B] Libananco Holdings Co. Limited v. Republic of Turkey (ICSID Case No. ARB/06/08), Award of 2 September 2011, 99 560, 562-568 [Michael Hwang (pres.), Henri C. Alvarez, Franklin Berman]

[C] Comments and Questions

Chapter 12 Procedure and Proof: Developing the Case § 12.01 Introduction § 12.02 The Duty to Arbitrate in Good Faith and the Equality of Arms

[A] Thomas W. Wälde, Procedural Challenges in Investment Arbitration Under the Shadow ofthe Dual Role of the State: Asymmetries and Jhbmak' Dwfy 6, Bwune, EqWüy qfArma, 26( 1) Arb Int'l 3,11-12,38-42 (2010)

1

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[B] Methanex Corporation v. United States (ad hoc arbitration under the 1976 UNCITRAL Rules), Final Award of 3 August 2005,99 4,6, 8, 53-55,57-58 [V. V. Veeder (pres.), William F. Rowley, W. Michael Reisman] 1088

[C] Libananco Holdings Co. Limited v. Republic ofTurkey (ICSID Case No. ARB/06/8), Decision on Preliminary Issues of 23 June 2008,72,74-80,82 [Michael Hwang (pres.), Henri C. Alvarez, Franklin Berman] 1090

[D] Comments and Questions 1094 § 12.03 Arbitral Procedure 1095

[A] ICSID Arbitration Rules (2006), Rules 29-36 1095 [B] UNCITRAL Arbitration Rules (2010), Articles 17,27 and28 1097 [C] IBA Rules on the Taking of Evidence in International Arbitration

(2010), Articles 4 and 8 1098 [D] The Preliminary Hearing - Howard M. Holtzmann, Streamlining

Arbitral Proceedings: Some Techniques ofthe Iran-United States Claim Tribunal, 11 (l) Arb. Int'l 39,40-46 (1995) 1101

[E] Witness Statements and Testimony - Michael Bühler and Carroll Dorgan, Witness Testimony Pursuant to the 1999 IBA Rules of Evidence in International Commercial Arbitration: Novel or Tested Standards?, 17(l) J. Int'l Arb. 3,13-16,20-21,24-25,28-29 (2000) 1104

[F] Fundamental Rules of Procedure and ICSID Annulment 1108 [ 1 ] R. Doak Bishop and Silvia M. Marchiii, Annulment Under the

ICSID Convention, 129,134-135 (Oxford University Press 2012) 1108 [2] Fraport AG Frankfurt Airport Services Worldwide v. Republic of

the Philippines (ICSID Case No. ARB/03/25), Decision on the Application for Annulment of 23 December 2010,99 180,185-187,197,200,202-203,218-228,230-231 [Peter Tomka (pres.), Dominique Hascher, Campbell McLachlan] 1109

[G] Challenges to Arbitrators - Suez, Sociedad General deAguas de Barcelona, S.A. and Vivendi Universal, S.A. v. Argentine Republic (formerly Aguas Argentinas, S.A., Suez, Sociedad General deAguas de Barcelona, S.A.and Vivendi Universal, S.A. v. Argentine Republic) (ICSID Case No. ARB/03/19) and Suez, Sociedad General deAguas de Barcelona S.A., and InterAguas Servicios Integrales del Agua S.A. v. The Argentine Republic (formerly Aguas Provinciales de Santa Fe S.A, Suez, Sociedad General deAguas de Barcelona, S.A., and InterAguas Servicios Integrales del Agua, S.A.) (ICSID Case No. ARB/03/17) and AWG Group Limited v. Argentine Republic (ad hoc arbitration under the 1976 UNCITRAL Rules), Decision on a Second Proposal for the Disqualification of a Member of the Arbitral Tribunal of 12 May 2008, 99 9-12,21-22,24-33,35,39-40,45-48 [Jeswald W. Salacuse (pres.), Pedro Nikken] 1113

[H] Control of Dilatory Tactics - L. Yves Fortier, The Minimum Requirements ofDue Process in Taking Measures Against Dilatory Tactics: Arbitral Discretion in International Commercial Arbitration: 'A Few Piain

Ii


Rules and a Few Strong Instinds', in Improving the Efßciency ofArbitration Agreements and Awards: 40 Years of Application of the New York Convention, ICCA Congress Series No. 9,396,403,405-407 (Albert Jan van den Berg (ed.), Kluwer Law International 1999) 1120

[i] Comments and Questions 1121 § 12.04 Confidentiality 1123

[A] Metalclad Corp. v. United Mexican States (ICSID Case No. ARB(AF)/97/l), Award of 30 August 2000,9 13 [Elihu Lauterpacht (pres.), Benjamin R. Civiletti, Jose Luis Siqueiros] 1123

[B] Biwater Gauff (Tanzania) Ltd. v. United Republic of Tanzania (ICSID Case No. ARB/05/22), Procedural Order No. 3 of 29 September 2006,99 112,114-116,121,125,133-136,145-147,163 [Bernard Hanotiau (pres.), Gary B. Born, Toby Landau] 1124

[C] Comments and Questions 1127 § 12.05 The Role of Amicus Curiae in Investment Disputes 1127

[A] ICSID Arbitration Rules (2006), Rule 37(2) 1127 [B] NAFTA Free Trade Commission, Statement on Non-Disputing Party

Participation (2003) 1128 [C] Methanex Corporation v. United States (ad hoc arbitration under the

1976 UNCITRAL Rules), Decision of the Tribunal on Petitions from Third Persons to Intervene as Amici Curiae' of 15 January 2001,99 24-31,35-37,40-42,47-51, 53 [W. Veeder (pres.), William F. Rowley, Warren Christopher] 1129

[D] Comments and Questions 1134 § 12.06 Document Exchanges and Sanctions 1135

[A] IBA Rules on the Taking of Evidence in International Commercial Arbitration (2010), Article 3 1135

[B] Use of the IBA Rules - CME Czech Republic B.V. (The Netherlands) v. The Czech Republic (ad hoc arbitration under the 1976 UNCITRAL Rules), Partial Award of 13 September 2001,99 46-47, 52-53 [Wolfgang Kühn (pres.), Stephen M. Schwebel, Jaroslav Händl] 1137

[C] Requests for Production of Electronic Documents - Richard Hill, The New Reality of Electronic Document Production in International Arbitration: ACatalystfor Convergence?, 25(l) Arb. Int'l 87,91-92 (2009) 1138

[D] The Use of 28 U.S.C. § 1782 for Obtaining Evidence in the United States 1139 [1] Methanex Corporation v. United States (ad hoc arbitration under

the 1976 UNCITRAL Rules), Final Award of 3 August 2005, 99 1-3,5,26 [V. V. Veeder (pres.), William F. Rowley, W. Michael Reisman] j 139

[2] In re Application of Chevron Corp. for an Order Pursuant to 28 U.S.C. Section 1782 to Conduct Discovery for Use in Foreign Proceedings, 633 F.3d 153,158-159,161-162,163 (3d Cir. 2011) 1140

[E] Legal Privileges to Resist Document Production 1143

Table of Contents

[ l] Biwater Gauff (Tanzania) Ltd. v. United Republic ofTanzania (ICSID Case No. ARB/05/22), Procedura! Order No. 2 of 24 May 2006 [Bernard Hanotiau (pres.), Gary B. Born, Toby Landau] 1143

[2] Glamis Gold, Ltd. v. United States (ad hoc arbitration under the 1976 UNCITRAL Rules), Decision on Parties' Requests for Production of Documents Withheld on Grounds of Privilege of 17 November 2005,31-32,34-37 [Michael K. Young (pres.), David D. Caron, Donald L. Morgan] 1145

[3] William Ralph Clayton, William Richard Clayton, Douglas Clayton, Daniel Clayton andBilcon of Delaware Inc. v. Government of Canada (PCA Case No. 2009-04), Procedural Order No. 12 of 2 May 2012,99 17-19,21,25-26,29, and Procedural Order No. 13 of 11 July 2012, 99 22,24-30,34-35 [Bruno Simma (pres.), Donald McRae, Bryan Schwartz] 1146

[F] Adverse Inferences 1151 [ 1 ] Durward V. Sandifer, Evidence Before International Tribunals, 150,

153 (2nd ed., University ofVirginia Press 1975) 1151 [2] Charles N. Brower, Evidence Before International Tribunals: The

Needfor Some Standard Rules, 28 Int'l Law. 47,57 (1994) 1151 [3] Howard M Holtzmann, Fact-Finding by the Iran-United States

Claims Tribunal, in Fact-Finding Before International Tribunals [eleventh Sohol Colloquium], 101,127-128 (Richard B. Lillich (ed.), Transnational Publishers 1992) 1152

[4] Vera Van Houtte, Adverse Inferences in International Arbitration, Chapter 5 in Written Evidence and Discovery in International Arbitration, 201-205,214 (Teresa Giovannini and Alexis Mourre (eds), International Chamber of Commerce 2009) 1153

[5] IBA Rules on the Taking of Evidence in International Commercial Arbitration (2010), Article 9(5) and 9(6) 1154

[G] Comments and Questions 1154 § 12.07 Evidence 1155

[A] IBA Rules on the Taking of Evidence in International Commercial Arbitration (2010), Article 9 1155

[B] Charles N. Brower, Evidence Before International Tribunals: The Needfor Some Standard Rules, 28 Int'l Law. 47,47-48,51-52,54-55 (1994) 1156

[C] Bürden ofProof 1159 [ 1 ] Durward V. Sandifer, Evidence Before International Tribunals, 123-

124,127,129-131 (2nd ed., University ofVirginia Press 1975) 1159 [2] Charles N. Brower, Evidence Before International Tribunals: The

Needfor Some Standard Rules, 28 Int'l Law. 47,49 (1994) 1161 [3] Karl-Heinz Böckstiegel, PresentingEvidence in International

Arbitration, 16(l) Foreign Int'l L.J. 1,2-3 (2001) 1162 [4] Marion Unglaube and Reinhard Unglaube v. Republic of Costa Rica

(ICSID Case Nos. ARB/08/1 and ARB/09/20), Award of 16


May 2012, 99 33-36 [Judd Kessler (pres.), Franklin Berman, Bernardo M. Cremades] 1162

[5] Marvin Roy Feldman Karpa v. United Mexican States (also known as Marvin Feldman v. Mexico) (ICSID Case No.ARB(AF)/99/l), Award of 16 December 2002, 99 177-178 [Konstantinos D. Kerameus (pres.), Jorge Covarrubias Bravo, David A. Gantz] 1163

[6] Waguih Elie George Siag and Clorinda Vecchi v. The Arab Republic of Egypt (ICSID Case No. ARB/05/15), Award of 1 June 2009, 99 325-326 [David A.R. Williams (pres.), Michael Pryles, Francisco Orrego Vicuna] 1164

[7] EDF (Services) Limited v. Romania (ICSID Case No. ARB/05/13), Award of 8 October 2009,9 221 [Piero Bernardini (pres.), Arthur W. Rovine, Yves Derains] 1165

[D] Presumptions and Inferences 1166 [1] Durward V. Sandifer, Evidence Before International Tribunals, 141-

142,144-146 (2nd ed., University ofVirginia Press 1975) 1166 [2] Charles N. Brower, Evidence Before International Tribunals: The

Needfor Some Standard Rules, 28 Int'l Law. 47, 56 (1994) 1167 [3] Howard M. Holtzmann, Fact-Finding by the Iran-United States

Claims Tribunal, in Fact-Finding Before International Tribunals [eleventh Sokol Colloquium], 101,126-27 (Richard B. Lillich (ed.), Transnational Publishers 1992) 1168

[4] George C. Christie, What Constitutes a Taking of Property Under International Law?, 38 Brit. Y.B. Int'l L. 307,324-326 (1962) 1168

[E] Interested Witnesses - Michael Straus, The Practice ofthe Iran-U.S. Claims Tribunal in Receiving Evidence frorn Parties andfrom Experts, 3(3) J. Int'l Arb. 57,58-60,61-63 (1986) 1169

[F] Asian Agricultural Products Ltd. v. Republic ofSri Lanka (ICSID Case No. ARB/87/3), Final Award of 27 June 1990, 9 56 [Ahmed S. El-Kosheri (pres.), Berthold Goldman, Samuel K.B. Asante] 1171

[G] Tradex Hellas S.A. v. Republic of Albania (ICSID Case No. ARB/94/2), Award of 29 April 1999,99 77-83 [Karl-Heinz Böckstiegel (pres.), Fred F. Fielding, Andrea Giardian] 1172

[H] William A. Parker v. United Mexican States (General Claims Commission - United States and Mexico), 31 March 1926,4 R.I.A.A. 35,99 5-7 (1926) [General Claims Commission] 1174

[I] Comments and Questions 1175

Chapter 13 Recognition andEnforcement of International Arbitral Proceedings and

Awards § 13.01 Introduction j § 13.02 Recognition and Enforcement Mechanisms j l77

[A] The Special Regime ofthe ICSID Convention H77

liv

1177

Table of Contents

[ 1 ] Convention on the Settlement of Investment Disputes Between States and Nationais of Other States [ICSID or Washington Convention] (1965), 575 U.N.T.S. 160, Articles 53,54 and 55 1177

[2] Christoph H. Schreuer, Loretta Malintoppi, August Reinisch and Anthony Sinclair, The ICSID Convention: A Commentary, Article 54,1117-1120,1128-1130 (2nd ed., Cambridge University Press 2009) 1178

[3] Benvenuti et Bonfant S.R.L. v. People's Republic ofthe Congo (ICSID Case No. ARB/77/2), Judgment ofthe Cour d'Appel de Paris of 26 June 1981,1 ICSID Rep. 368,369-372 (1993) 1181

[4] Enron Corporation and Ponderosa Assets, L.P. v. Argentine Republic (ICSID Case No. ARB/01/3), Decision on the Argentine Republic's Request for a Continued Stay ofEnforcement ofthe Award of 7 October 2008 [Gavan GriAth (pres.), Patrick L. Robinson, Per Tresselt] 1184

[B] Enforcement of Arbitral Awards (Other than ICSID) 1187 [1] The New York Convention 1187

[a] In General - Convention on the Recognition and Enforcement of Foreign Arbitral Awards [New York Convention] (1959), 330 U.N.T.S. 38, Articles I through VII 1187

[b] Direct Effect of International Arbitral Awards Made under Treaties - Dallal v. BankMellat, Judgment ofthe Queens Bench Division of the High Court of England and Wales of 26 July 1985,751.L.R. 151,165-168 (1987) 1189

[c] Grounds for Refus al of Recognition and Enforcement -Southern Pacific Properties (Middle East) Limited v. Arab Republic of Egypt, Judgment of the District Court of Amsterdam of 12 July 1984,861.L.R. 492,493-495 (1991) 1192

[2] Regional Conventions 1194 [a] Inter-American Convention on International Commercial

Arbitration [Panama Convention] (1975), 1438 U.N.T.S. 248 1194 [b] European Convention on International Commercial

Arbitration (1961), 484 U.N.T.S. 349 1197 § 13.03 Challengeto Arbitral Awards 1201

[A] Challenge to Awards under the ICSID Convention 1201 [l] Interpretation, Revision and Annulment of an ICSID Award 1201

[a] Convention on the Settlement of Investment Disputes Between States and Nationais of Other States [ICSID or Washington Convention] (1965), 575 U.N.T.S. 160, Articles 50,51 and 52 1201

[b] Compania deAguas delAconquija S.A. and Vivendi Universal (formerly Compagnie Generale Des Eaux) v. Argentine Republic, Decision on Annulment of 3 July 2002,6 ICSID Rep. 340, 358-360,362-371 (2004) [L. Yves Fortier (pres.), James R. Crawford, Jose Carlos Fernändez Rozas] 1203

Iv

Foreign Investment Disputes — Cases, Materials and Coitimentary

[c] Comments and Questions 1209 [d] AES Summit Generation Limited andAES-Tisza Erömü Kft.

v. Hungary (ICSID Case No. ARB/07/22), Decision on Annulment of 29 June 2012 [Bernard Hanotiau (pres.), Rolf Knieper, Abdulqawi Ahmed Yusuf] 1209

[2] Supplementation and Rectification of an ICSID Award 1212 [a] Convention on the Settlement of Investment Disputes

Between States and Nationais of Other States [ICSID or Washington Convention] (1965), 575 U.N.T.S. 160, Article 49 1213

[b] Compania deAguas delAconquija S.A. and Vivendi Universal (formerly Compagnie Generale Des Eaux) v. Argentine Republic (ICSID Case No. ARB/97/3), Decision on Supplementation and Rectification of 28 May 2003, 8 ICSID Rep. 489,492-495 (2005) [L. Yves Fortier (pres.), James R. Crawford, Jose Carlos Fernändez Rozas] 1213

[B] Challenge of Awards ofNon-ICSID Tribunals 1214 [ 1 ] UNCITRAL Model Law on International Commercial

Arbitration (1985, amended 2006), Article 34 1214 [2] Explanatory Note by the UNCITRAL Secretariat on the 1985

Model Law on International Commercial Arbitration as amended in 2006, Section 7 1215

[3] Czech Republic v. CME Czech Republic B.V., Judicial Review by the Svea Court of Appeal of 15 May 2003,9 ICSID Rep. 439,493-494,497-499, S02-S07 (2006) 1216

[4] Comments and Questions 1222 [5] Arbitration Act 1999, S.F.S. 1999:116 (Sweden), Sections 43 and 44 1222 [6] Arbitration Act 1996, c. 23 (UK), Sections 67 through 71 1223 [7] Republic of Ecuador v. Occidental Exploration & Production

Company, Judgment ofthe Court of Appeal (Civil Division) of England and Wales of 4 July 2007, [2007] E.W.C.A. Civ. 656 1227

[C] Interpretation and Supplementary Decisions of Awards under the ICSID Additional Facility 1231 [1] Rules Governing the Additional Facility for the Administration

of Proceedings by the Secretariat of the International Centre for Settlement of Investment Disputes [Additional Facility Rules] (2006), Articles 55,56 and 57 1231

[2] United Mexican States v. Metalclad Corporation, Judgment ofthe Supreme Court of British Columbia of 2 May 2001,1191.L.R. 646,659-661,664-666,668-681 (2002) 1231

[3] Raymond L. Loewen v. United States ofAmerica, Judgment ofthe District Court of the District of Columbia of 31 October 2005, 10 ICSID Rep. 448,450-452 (2006) j 241

§ 13.04 Issues of State or Sovereign Immunity 2 244 [A] Basic Distinctions ^44

[1] 'Sovereign and'Commercial'Activity ^44

Ivi

Table of Contents

[a] United Nations Convention on Jurisdictional Immunities of States and Their Property (2004), UN Doc. A/RES/59/38, Articles 1,2,5 and 10 1244

[b] Jurisdictional Immunities ofthe State (Germany v. Italy; Greece intervening), ICJ, Judgment of 3 February 2012, paragraphs 59-61 1245

[2] Immunity from Jurisdiction and Immunity from Enforcement 1246 [a] Restatement (Third) Foreign Relations Law of the United

States, § 451,396-398 (American Law Institute 1987) 1246 [b] Restatement (Third) Foreign Relations Law of the United

States, § 460,434-436 (American Law Institute 1987) 1247 [c] United Nations Convention on Jurisdictional Immunities of

States and Their Property (2004), UN Doc. A/RES/59/38, Articles 18,19,20 and 21 1249

[d] United Nations Convention on Jurisdictional Immunities of States and Their Property (2004), UN Doc. A/RES/59/38, Article 17 1251

[B] Differing National Approaches 1251 [1] The US Approach 1251

[a] Foreign Sovereign Immunities Act 1976,28 U.S.C. Chapter 97 (US), Sections 1604 through 1611 1251

[b] Frontera Res.Azer. Corp. v. State Oil Co. ofthe Azerbaijan Republic, Judgment ofthe Court of Appeals for the Second Circuit of 28 September 2009,582 F.3d 393,395-402 (2d Cir. 2009) 1257

[c] Restatement (Third) Foreign Relations Law ofthe United States, §456,415-419 (American Law Institute 1987) 1261

[2] The UK Approach 1264 [a] State Immunity Act 1978, c. 33 (UK), Sections 18 and 19 1264 [b] AIG Capital Partners v. Kazakhstan, Judgment of the Queen s

Bench Division of the High Court of England and Wales of 20 October 2005, [2005] E.W.H.C. Comm. 2239,1291.L.R. 589, 605-607,610,612-616,623-626,628 (2007) 1265

[C] Assets Subject to Attachment and Execution 1272 [1] Helms Amendment to the Foreign Assistance Act 1973,22 U.S.C.

§ 2151b(f)(l), Section 2370a 1272 [2] Foreign States Immunities Act 1985 as amended (Australia),

Sections 30 through 35 1274

Index 1277

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