In a decision rendered on April 15, 2009, a three-member tribunal composed of Brigitte Stern as chairperson, Andreas Bucher and Juan Fernandez-Armesto rejected Phoenix Action Ltd’s (“Phoenix”) claims against the Czech Republic. By way of background, Phoenix is an Israeli company which purchased two Czech companies, Benet Praha (“BP”) and Benet Group (“BG”), in 2002…

It is well accepted that state responsibility arises under international law for denial of justice. This might occur, for example, where a state court abuses its supervisory function over an international arbitration. In the investment treaty context, a denial of justice by host state courts would normally lead to a fairly straight forward breach of…

One of the benefits of international commercial arbitration is the ability to resolve disputes between the parties in a single, neutral forum that gives neither party a “home court advantage.” After a dispute arises, however, litigious parties sometimes engage in tactical maneuvering aimed at circumventing the parties’ agreement to arbitrate. A recent US case gives…

One of the greatest challenges for international arbitration in recent times is the users’ complaint that the process has become too costly. In-house counsel are under pressure to control costs, and they grumble that arbitrators and international arbitration counsel are not sufficiently responsive to their concerns. Outside counsel are rightly troubled by these complaints. Frustrating…

How should tribunals apply investment treaties to measures adopted during times of crisis? Recognizing crisis as the point at which foreign investors become most vulnerable (and therefore require the most protection), should tribunals guard against any temptation to dilute the rigor of external discipline? Conversely, recognizing crisis as the point at which states can lay…

In submitting his instructions to the American delegation attending the 1907 Second Hague Conference, Secretary of State Elihu Root argued that the Permanent Court of Arbitration system needed radical improvement. In his instructions he wrote: There can be no doubt that the principal objection to arbitration rests, not upon the unwillingness of nations to submit…

1. Is Arbitral Jurisprudence anything more than a myth? 2. How does persuasiveness of past awards operate? 3. Is Precedent the product of the intrinsic qualities of one or more particularly well-reasoned awards? 4. Why do arbitral awards need to be available? 5. Why is reliance on arbitral precedents not frequent? 6. Should all awards…

The already much debated Paris Court of appeal judgment in Tecnimont, rendered on 12 February 2009, has put into light the dangers arising from the lack of uniformity in the field of conflict disclosure. The Paris Court of appeal has quashed a partial award because the chairman of the arbitral tribunal, a well-known international arbitrator…

When does a most-favoured-nation (MFN) treatment clause in an investment treaty confer jurisdiction on an investor-state arbitration tribunal? Most readers will be aware that in a series of decisions investment treaty tribunals have given very different responses to this question. On the one hand, a line of decisions suggests that, unless there is a express…

The Paris Court of appeal, on 25 September 2008, and the Swiss Federal Tribunal, on 5 December 2008 have rendered two interesting decisions. These two decisions address issues of primary importance, such as the “extension” of the arbitration agreement, joinders, and the scope of review by courts of award having declined the tribunal’s jurisdiction. These…

In a post last month, I offered a few thoughts on the future of moral damages in investment treaty arbitration. One arbitration where I thought we might see an award of moral damages is a case pitting a group of Dutch farmers (Funnekotter, et.al.) against the Government of Zimbabwe. By way of update, I wanted…

The relationship between Arbitration and European Judicial Private Law has not always been easy. The bedrock European Law principle in this field, as embedded in the European Council Regulation (EC) No. 44/2001 of December 22, 2000 on Jurisdiction and the Recognition and Enforcement of Judgments in Civil and Commercial Matters (“the Judgment Regulation”), is the…

Dedicated to the late Thomas Wälde, The Future of Investment Arbitration examines some of the current pressures on investment arbitration and looks toward the future of the system as a whole. The authors address issues such as gaps in the procedural rules, the lack of development in certain substantive areas of international investment law, inconsistencies…

For international arbitrations seated in the United States, there has sometimes been a tension between the so-called “American rule” against the shifting of attorneys’ fees and litigation costs to the loser of the proceedings, and the more accepted practice of fee-shifting in international arbitrations as expressed in procedural rules such as the UNCITRAL and LCIA…

On Tuesday, the United States Supreme Court decided Iran v. Elahi, a case that appears to fall within a data set of one. As I reported elsewhere, the case is extraordinarily complex, focusing on whether a terrorist victim judgment creditor can attach a confirmed arbitration award rendered in Iran’s favor. Although it involves exotic issues…

In two recently reported cases, parties to arbitrations have challenged arbitrator and/or institutional fees where the underlying awards have also been subject to annulment or set aside proceedings. Are these cases isolated instances or do they signal an increased trend? The answer may have widespread ramifications for how, and where, arbitrations are conducted and administered….

In the early 1990’s, then World Bank Senior Vice President and General Counsel, Ibrahim Shihata, and then ICSID Legal Advisor, Antonio Parra, observed that there “was hardly any case law” on the full protection and security standard. In so doing, Messrs. Shihata and Parra also posited that “[a]rbitrators in future cases will undoubtedly have the…

One of the more intriguing investment arbitration decisions rendered in 2008 has to be the final award in Desert Line Properties (DLP) v. Yemen. In their February 2008 award, a tribunal of three arbitrators held that Yemen denied fair and equitable treatment to an Omani construction company. The claimant turned to ICSID after Yemeni authorities…

In Switzerland, the Federal Supreme Court has recently, and for the first time, had the opportunity to hear and reject the challenge of an award rendered pursuant to the Expedited Procedure (Article 42) of the Swiss Rules. There is nowadays a recurring complaint that arbitration is becoming too long and too expensive a dispute resolution…

George Bermann, the ALI Reporter for the Restatement (Third) on the U.S. Law of International Commercial Arbitration, presented a wonderful summary of the current progress on the Restatement at the ASIL annual meeting last week. Here are a few key thoughts from my notes. The Restatement is in its early stages and it could take…

In a recent decision of 22 January 2009 (4A_424/2008), the Swiss Federal Supreme Court had to consider an appeal against a decision of the Court of Arbitration for Sport (CAS). In the run-up to the 2008 Summer Olympics in Beijing, a qualifying competition was held for the women’s Olympic hockey tournament. The Spanish team won…

A recent decision of the English High Court (F Ltd v M Ltd [2009] EWHC 275 (TCC)) confirms that the Court may intervene and allow successful challenge of an arbitral award in order to protect parties against the unfair conduct of an arbitration. However, the case also demonstrates that the applicable test (i.e. a serious…

Two weeks ago, an LCIA tribunal issued its Award on Remedies in a dispute filed by the U.S. against Canada under the 2006 Softwood Lumber Agreement (SLA). This dispute is interesting in many respects. Most obviously, it is a state-to-state dispute adjudicated under the auspices of the LCIA, more commonly used for commercial arbitration. This…

The U.S. Supreme Court’s recent decision in Hall Street Associates, L.L.C. v. Mattel, Inc., 128 S. Ct. 1369 (2008) has provoked substantial commentary – as with many Supreme Court decisions regarding arbitration. The Hall Street decision held that the Federal Arbitration Act (“FAA”) did not permit parties contractually to expand the grounds for vacating or…