The arbitration risk facing sovereign investors

Author: | Published: 1 Dec 2004

Arbitration between investors and states has become an important form of dispute resolution, largely because of the growing number of bilateral investment agreements and free trade agreements around the world. The Convention for the Settlement of Investment Disputes between States and Nationals of Other States (the Icsid Convention) establishes one of the most prominent systems for these arbitrations. It is a common assumption that the Icsid Convention eliminates defences to the enforcement of awards issued by arbitral tribunals organized under the auspices of the International Centre for the Settlement of Investment Disputes (Icsid) in investor-state arbitrations. As the annulment panel in MINE v Republic of Guinea stated this view, the Icsid Convention "excluded any attack on the award in the national courts". But this assumption is overstated. What little case law exists is not fully consistent with this view, and the Convention itself affords defences to a party opposing enforcement of an Icsid award....

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