scholarly journals INDONESIA’S NEW MODEL OF BILATERAL INVESTMENT TREATY: COMPARISON WITH BRAZIL

2019 ◽  
Vol 3 (2) ◽  
pp. 235-254
Author(s):  
Resha Roshana Putri
Keyword(s):  
Dispute Settlement ◽  
International Investment ◽  
Foreign Investors ◽  
Bilateral Investment Treaty ◽  
Healthy Environment ◽  
The Past ◽  
Investment Treaty ◽  
The People ◽  
The Right ◽  
Investment Facilitation

AbstractIn the past few years, there has been a surge in lawsuits against the mechanism for resolving international investment disputes through the Investors State Dispute Settlement (ISDS) forum proposed by foreign investors who are host states, including Indonesia. Most of the claims are caused by the policies of the host country which are intended to protect the basic rights of the people such as the right to health, the right to a healthy environment, taxes, as well as the minimum standard of wages for workers. This policy provides a loss for foreign investors and is considered a violation of the Bilateral Investment Treaty (BIT). BIT is often recognized to be detrimental to Indonesia, because it can disrupt the sovereignty of the country, especially when dealing with international disputes with foreign investors. This study uses a comparative juridical approach, comparing the BIT model in Indonesia with Brazil, namely Cooperation and Investment Facilitation Agreement (CIFA). Brazil was chosen because it succeeds to reform its investment regime, specifically on its BITs. The results obtained were that Indonesia had to change several provisions in its BITs, which has been regulated CIFA provisions in Brazil, which is not member of the ICSID Convention.Keywords: BIT, CIFA, Investor State Dispute Settlement. AbstrakBeberapa tahun terakhir, ada lonjakan tuntutan hukum terhadap mekanisme penyelesaian sengketa investasi internasional melalui Investor State Dispute Settlement (ISDS) forum yang diusulkan oleh investor asing yang menjadi host states, termasuk Indonesia. Sebagian besar klaim disebabkan oleh kebijakan negara tuan rumah yang dimaksudkan untuk melindungi hak-hak dasar masyarakatnya seperti hak atas kesehatan, hak atas lingkungan yang sehat, pajak, juga standar minimum upah pekerja. Kebijakan ini memberikan kerugian bagi investor asing dan dianggap sebagai pelanggaran Bilateral Investment Treaty (BIT). BIT seringkali dianggap merugikan bagi Indonesia, karena dapat mengganggu kedaulatan negara, khususnya ketika berhadapan dengan sengketa internasional dengan investor asing. Penelitian ini menggunakan pendekatan yuridis normatif dengan metode perbandingan, yaitu dengan membandingkan model BIT di Indonesia dengan Brazilia, yaitu Cooperation and Investment Facilitation Agreement (CIFA). Brazil dipilih karena merupakan negara yang berhasil melakukan reformasi terhadap rezim investasinya, khususnya pada BIT. Hasil yang diperoleh adalah bahwa Indonesia harus merubah beberapa ketentuan dalam BITs nya, seperti yang terkadung dalam CIFA di Brazil, yang bukan merupakan negara anggota dari Konvensi ICSID. Kata Kunci: BIT, CIFA, Penyelesaian Sengketa Investor-Negara

scholarly journals LEGAL PROTECTION AGAINST THE FAILURE TO COMPENSATE ON INTERNATIONAL INVESTMENT DISPUTE

2019 ◽  
Vol 8 (2) ◽  
pp. 205
Author(s):  
Vunieta . ◽  
Walida Ahsana Haque
Keyword(s):  
Foreign Investment ◽  
Dispute Settlement ◽  
Legal Protection ◽  
International Investment ◽  
Bilateral Investment Treaty ◽  
Arbitral Award ◽  
Investment Treaty ◽  
Arbitration Proceeding ◽  
Investment Agreement ◽  
Arbitration Award

A dispute between two or more countries involved in a foreign investment may arises<br />from investment agreement agreed upon by the parties. If one of the parties breaches<br />the agreement, the parties will automatically agree to resolve the dispute to the agreed<br />arbitration forum based on the dispute settlement clause on the agreement, those<br />forum such as the ICSID arbitration. Therefore, the existence of dispute settlement<br />clause on an investment agreement (Bilateral Investment Treaty) is very necessary.<br />The result of the above-mentioned arbitration proceeding is a binding and final<br />decision for the parties. An arbitral award, should contain relief or compensation<br />set by the arbitrator as the result of the proceeding. The reliefs are given as orders to<br />indemnify the damages obtained by Claimant. Issues arises when Respondent has been<br />proven to have done detrimental damage to the Claimant yet Respondent deliberately<br />neglected his/her obligation to compensate Claimant accordingly based on the relief/<br />compensation specified in the award. The non-compliance of the Respondent to<br />fulfill the compensation obligation is due to the fact that the party habitually assume<br />that the arbitration award does not have the legal force equivalent to the decision<br />of general court, even though the nature of the award is final and binding. Thus the<br />interests and rights of the Applicant who has been declared entitled to compensation<br />based on the arbitration award must be protected so that their rights can be fulfilled<br />according to the law.

scholarly journals Cortec Mining Kenya Limited, Cortec (Pty) Limited, and Stirling Capital Limited v. Republic of Kenya

2019 ◽  
Vol 113 (3) ◽  
pp. 574-581
Author(s):  
Lorenzo Cotula ◽  
James T. Gathii
Keyword(s):  
International Law ◽  
Dispute Settlement ◽  
Environmental Law ◽  
International Investment ◽  
Arbitral Tribunal ◽  
Public International Law ◽  
Bilateral Investment Treaty ◽  
Investment Treaty ◽  
Legal Implications ◽  
Mining Project

In Cortec v. Kenya, an investor-state arbitral tribunal established under a bilateral investment treaty (BIT) held it lacked jurisdiction to hear a dispute concerning a mining project that the tribunal found did not comply with domestic environmental law. The award raises significant issues of public international law, including how questions of investor compliance are considered in investor-state dispute settlement and the legal implications of investor noncompliance. The issues resonate with wider debates about balancing investor rights and obligations in the international investment regime.

System-Building in Investment Treaty Arbitration and Lawmaking

2011 ◽  
Vol 12 (5) ◽  
pp. 1083-1110 ◽  
Author(s):  
Stephan W. Schill
Keyword(s):  
Free Trade ◽  
Dispute Settlement ◽  
State Level ◽  
Trade Agreement ◽  
International Investment ◽  
Foreign Investors ◽  
Investment Protection ◽  
The North ◽  
Investment Treaty ◽  
Investment Treaty Arbitration

Since the late 1990s investment treaty arbitration has developed into one of the most vibrant fields of international dispute settlement with now almost 400 known cases. It involves claims by foreign investors against host States for breach of obligations assumed under one of the more than 2700 bilateral investment treaties (BITs), under the numerous investment chapters in bilateral or regional free trade agreements, including the North American Free Trade Agreement, or under sectoral treaties such as the Energy Charter Treaty. All of these instruments offer comprehensive protection to foreign investors by setting down principles of substantive investment protection, including national and most-favored-nation treatment, fair and equitable treatment, full protection and security, protection against expropriation without compensation, and free capital transfer. They also allow investors to enforce these standards in arbitral proceedings directly against the host State, most commonly under the Convention on the Settlement of Investment Disputes between States and Nationals of Other States (ICSID Convention). Investment treaty arbitration thereby not only empowers foreign investors under international law, but also introduces investment treaty tribunals as novel actors into the arena of international investment law. Although arbitration has been a classic form of dispute settlement on the State-to-State level, including for the settlement of investment-related disputes, modern investment treaty tribunals have wider jurisdiction and are more removed from State control than any of their predecessors.

DENIAL OF JUSTICE DISGUISED? INVESTMENT ARBITRATION AND THE PROTECTION OF FOREIGN INVESTORS FROM JUDICIAL MISCONDUCT

2012 ◽  
Vol 61 (1) ◽  
pp. 223-246 ◽  
Author(s):  
Mavluda Sattorova
Keyword(s):  
Dispute Settlement ◽  
Effective Means ◽  
International Investment ◽  
State Courts ◽  
Foreign Investors ◽  
International Investment Law ◽  
Host State ◽  
Legal Standards ◽  
National Courts ◽  
Investment Treaty

Prior to the rise of international investment treaties and institutionalization of investor–state arbitration, the protection of foreign investors from mistreatment in the host state courts was the preserve of customary international law, which prohibited a denial of justice and provided for diplomatic protection as a principal means of dispute settlement. In contrast, contemporary international investment law offers a whole array of legal standards that can be invoked in seeking redress for the acts of national courts before international arbitral tribunals. In addition to relying on the customary prohibition of denial of justice, investors can challenge judicial conduct under the treaty standards on expropriation, fair and equitable treatment and, in some cases, the obligation to ensure effective means of asserting claims. Although the multiplicity of standards available to aggrieved investors can be regarded as an inalienable part of an effective regime for the protection of foreign investment, it also gives rise to a number of fundamental problems relating to the application of procedural mechanisms designed to control the review of the conduct of national judiciary by international courts and tribunals. Focusing on arbitral cases in which claims of a denial of justice were brought under the rubric of ‘a judicial expropriation’ and ‘a failure to provide effective means of asserting claims’, this article seeks to ascertain when investor claims relating to the administration of justice in the host state courts become amenable to arbitral scrutiny. It argues that, by providing a variety of standards under which the acts of judiciary can be challenged, investment treaty law allows investors to circumvent procedural barriers and thus muddles the boundaries demarcating the scope of international review of national judicial conduct.

scholarly journals Brazil’s New Model of Dispute Settlement for Investment: Return to the Past or Alternative for the Future?

2018 ◽  
Vol 19 (3) ◽  
pp. 475-512 ◽  
Author(s):  
Geraldo Vidigal ◽  
Beatriz Stevens
Keyword(s):  
Dispute Settlement ◽  
Trade Agreements ◽  
Legal Framework ◽  
International Investment ◽  
The European Union ◽  
The Past ◽  
Bilateral Relations ◽  
Investment Agreement ◽  
Investment Facilitation ◽  
Bilateral Treaties

Abstract This article assesses the contribution of Brazil’s new bilateral treaties on investment, labelled Cooperation and Investment Facilitation Agreements (CIFAs), to the international legal framework for transnational investment. With its CIFAs, nine of which were concluded since 2015, Brazil offers an innovative model of International Investment Agreement (IIA) which does not contain investor-state dispute settlement (ISDS). Instead, CIFAs establish a system that combines dispute prevention mechanisms, creating institutions to ensure continued communication and foster cooperation, and state-to-state arbitration (inspired by dispute settlement provisions common in trade agreements and codified in the World Trade Organization’s Dispute Settlement Understanding). Like recent initiatives put forward by India and the European Union, CIFAs aim not only to regulate bilateral relations but also to positively influence the current debates relating to the reform of the international investment regime. Whether they will become an alternative to the current ISDS-dominated framework will be determined by practice.

International Investment Agreements, 2015–2016

2017 ◽  
Author(s):  
Coleman Jesse ◽  
Johnson Lise ◽  
Sachs Lisa ◽  
Gupta Kanika
Keyword(s):  
Dispute Settlement ◽  
Codes Of Conduct ◽  
International Investment ◽  
Decision Makers ◽  
Investment Treaty ◽  
International Investment Agreements ◽  
The Right ◽  
Investment Agreements ◽  
The Eu

This chapter considers developments in 2015 and 2016 that illustrate trends and features in recent treaty drafting. It first discusses the expanded awareness of, and interest in, the investment regime that has emerged in recent years, followed by the role of ratification in the context of investment treaty drafting and policy. It then discusses four drafting trends: (1) constraining investor access to dispute settlement and limiting arbitral discretion; (2) better protecting the right to regulate; (3) establishing investor obligations; and (4) introducing codes of conduct for decision makers in investment disputes. Finally, the chapter provides a brief overview of new provisions regarding the conduct and qualifications of arbitrators, including a glimpse at the EU proposal for a multilateral court.

6 Umbrella Clause and Investment Contracts

2009 ◽  
Author(s):  
Gallagher Norah ◽  
Shan Wenhua
Keyword(s):  
Dispute Resolution ◽  
Joint Venture ◽  
International Investment ◽  
Foreign Investors ◽  
Bilateral Investment Treaty ◽  
Investment Treaty ◽  
Legal Effect ◽  
Petroleum Resources ◽  
The Impact ◽  
Multilateral Treaty

The “umbrella clause” takes its name from its main objective, namely to oblige the host state to observe any commitments it has entered into with regard to foreign investors. The clause brings such obligations of the state under the protection of an applicable international investment treaty, bilateral investment treaty (BIT), or multilateral treaty. This chapter begins by reviewing the evolution of the umbrella clause and how it has been applied by investment treaty tribunals. It then examines the main variants of umbrella clauses in Chinese BITs and discusses their legal effect in light of this recent jurisprudence. It moves on to analyze the impact, if any, of these clauses on investment contracts in China, including joint venture contracts, joint exploitation of onshore and offshore petroleum resources contracts, and build-operate-transfer contracts. The chapter concludes with an analysis of the implications of umbrella clauses and investment contracts on dispute-resolution planning for foreign investors.

scholarly journals The Urgency of Non-Precluded Measures Clause in Indonesian Bilateral Investment Treaty

2019 ◽  
Vol 06 (02) ◽  
pp. 233-253
Author(s):  
Sefriani Sefriani
Keyword(s):  
Public Health ◽  
Dispute Settlement ◽  
Investment Policy ◽  
Labor Rights ◽  
Foreign Investors ◽  
Bilateral Investment Treaty ◽  
Host State ◽  
Investment Treaty ◽  
International Financial Crisis ◽  
Legitimacy Crisis

The legitimacy crisis of the Bilateral Investment Treaty (BIT) within the international community was caused by the increasing regulatory disputes before the Investor-State Dispute Settlement (ISDS) forum. It encourages Indonesia to discontinue several BITs, to review and to make new BIT models for Indonesia. This article aims to analyze the urgency of the non-precluding measures (NPM) clause in the new BIT Model of Indonesia to balance the interests of investors and the interests of Indonesia as the host state, considering that to date the existing BIT content is not balanced. The BIT provides so much protection to investors and, vice versa, weighty obligations to the host country. This study employed descriptive analytical method. The study concludes that the NPM Clause is very important in the new Indonesian BIT Model. At least, can be based on five arguments. First, the NPM clause will transfer risk from the country to foreign investors in situations of extraordinary threats. Second, the NPM clause will limit investor protection in certain situations. Third, the NPM clause will provide greater flexibility to Indonesia as the host to regulate its investment policy to achieve sustainable development to realize the people’s welfare, labor rights, public health, safety environment, public morals, and order. Fourth, the NPM clause is important for self-recovery during international financial crisis. Fifth, lastly, the NPM clause will balance the protection of both investors and Indonesia as the host state.

The 2016 Morocco–Nigeria Bilateral Investment Treaty: More Practical Reality in Providing a Balanced Investment Treaty?

2019 ◽  
Vol 34 (1) ◽  
pp. 62-84
Author(s):  
Okechukwu Ejims
Keyword(s):  
Social Impact ◽  
Dispute Settlement ◽  
International Investment ◽  
Public Interests ◽  
Customary International Law ◽  
Investment Protection ◽  
Investment Treaty ◽  
Practical Reality ◽  
Private And Public ◽  
The Right

Abstract The law governing international investment comprises primarily treaties between individual States and regional arrangements focusing on investment provisions that protect and promote foreign investment and the principles of customary international law that govern it. Recently, there has been rapid growth in such agreements, and growing criticism of bilateral investment treaties (BITs) due to their unbalanced content and the vague and broad investment protection standards that can be interpreted in ways that prioritise investment protection over the right of host States to regulate. In this context, the Morocco–Nigeria BIT has been applauded as a balanced and innovative example of the genre and a response to the global backlash against BITs. This article shows how this BIT has taken a bold step towards such reconciliation, by attempting to balance investor protection with series of obligations placed on the investor on human rights, and environmental and social impact assessment, effectively safeguarding the host State’s regulatory space in relation to social and environmental matters. Whether this step has resolved the issue of balancing the interests of investment protection and the preservation of the regulatory interest of the host State is unlikely, given that some substantive provisions are drafted so as not to strike a proper balance between private and public interests. The discussion also shows that many provisions remain vague and, hence, continue to grant discretion to investor–State dispute settlement (ISDS) tribunals to determine the meaning of these provisions.

Investor-State dispute settlement (ISDS) cases and India: affronting regulatory autonomy or indicting capricious state behaviour?

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Prabhash Ranjan
Keyword(s):  
Public Interest ◽  
Dispute Settlement ◽  
Due Process ◽  
International Investment ◽  
Public Power ◽  
Foreign Investors ◽  
Content Type ◽  
International Investment Law ◽  
Global Context ◽  
State Behaviour

Purpose The dominant narrative in the investor-State dispute settlement (ISDS) system is that it enables powerful corporations to encroach upon the regulatory power of developing countries aimed at pursuing compelling public interest objectives. The example of Phillip Morris, the tobacco giant, suing Uruguay’s public health measures is cited as the most significant example to prove this thesis. The other side of the story that States abuse their public power to undermine the protected rights of foreign investors does not get much attention. Design/methodology/approach This paper reviews all the ISDS cases that India has lost to ascertain the reason why these claims were brought against India in the first place. The approach of the paper is to study these ISDS cases to find out whether these cases arose due to abuse of the State’s public power or affronted India’s regulatory autonomy. Findings Against this global context, this paper studies the ISDS claims brought against India, one of the highest respondent-State in ISDS, to show that they arose due to India’s capricious behaviour. Analysis of these cases reveals that India acted in bad faith and abused its public power by either amending laws retroactively or by scrapping licences without following due process or going back on specific and written assurances that induced investors to invest. In none of these cases, the foreign investors challenged India’s regulatory measures aimed at advancing the genuine public interest. The absence of a “Phillip Morris moment” in India’s ISDS story is a stark reminder that one should give due weight to the equally compelling narrative that ISDS claims are also a result of abuse of public power by States. Originality/value The originality value of this paper arises from the fact that this is the first comprehensive study of ISDS cases brought against India and provides full documentation within the larger global context of rising ISDS cases. The paper contributes to the debate on international investment law by showing that in the case of India most of the ISDS cases brought were due to India abusing its public power and was not an affront on India’s regulatory autonomy.

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