Investor Due Diligence and Legitimate Expectations

This article examines the significance of investor due diligence in the context of a claim that a host State has breached its obligation to provide fair and equitable treatment (FET). Despite increasing reliance on due diligence exercises, there are considerable differences in how tribunals understand and use such exercises. These differences are related to different visions of the function and future of international investment law. After exploring the different approaches that are taken, this article will argue that the most coherent approach is to treat investor due diligence as merely a technique for assessing investor reasonableness and prudence, rather than a strict requirement.

Deepfakes in International Arbitration: How Should Tribunals Treat Video Evidence and Allegations of Technological Tampering?

Deepfakes can be described as videos of people doing and saying things that they have not done or said. Their potential use in international arbitration leads to two competing threats. Tribunals may be conscious of the difficulties in proving that a deepfake is, in fact, fake. If the ‘clear and convincing evidence’ standard of proof is applied, it may be very difficult, if not impossible, to prove that a sophisticated deepfake is fake. However, the burgeoning awareness of deepfakes may render tribunals less inclined to believe what they see on video even in circumstances in which the video before it is real. This may encourage parties to seek to deny legitimate video evidence as a deepfake. The ‘balance of probabilities’ standard, while not perfect, would appear to address this concern. In order to properly assess deepfakes, tribunals should apply this standard while assessing both technical and circumstantial evidence holistically.

The Arbitration Panel Report in Ukraine – Export Prohibition on Wood Products: Lessons from the ‘Pegasus’ of International Adjudication

The Arbitration Panel’s decision in Ukraine – Export Prohibition on Wood Products suggests the emerging trend among some Word Trade Organization (WTO) Members to settle their trade irritants regionally. This dispute was adjudicated between the EU and Ukraine, which are both WTO Members, under the WTO rules that are incorporated by reference into the Association Agreement between these parties and by the Arbitration Panel the two members of which are well-known WTO adjudicators. The dispute settlement proceedings in this case thus illustrate how regional dispute settlement mechanisms work in practice and shed some light on whether these mechanisms could serve as a viable alternative to the WTO at the time of the ongoing WTO dispute settlement crisis. Moreover, from a substantive perspective, some may view this decision as an important milestone in international economic law, which contributes to the long-standing debate on how the right balance should be struck between trade and environmental considerations, in this case, the conservation of forests. This article, however, addresses several important shortcomings in the Arbitration Panel’s reasoning, which appear to diminish the relevance of the decision beyond the dispute at hand.

Holding Transnational Corporations Accountable for Environmental Harm Through Counterclaims in Investor-State Dispute Settlement: Myth or Reality?

Considering the imperative need to protect our environment, the present article begins by highlighting the absence of a comprehensive international framework under which transnational corporations may be held accountable for environmental harm. Drawing from the successful decisions on environmental counterclaims in Perenco v Ecuador and Burlington Resources v Ecuador, this article thus argues that this legal void could be filled by holding transnational corporations accountable for environmental harm under international investment law. However, the practice of environmental counterclaims as they have materialised in these recent decisions emphasises the existence of a gap between theory and reality and, thus, their limited chances of success. It is nevertheless suggested that, in the context of current debates surrounding an investor-State dispute settlement reform, States hold the cards to ensure that transnational corporations are held accountable for environmental harm under international investment law.

The Law on State Responsibility and the World Trade Organization

This paper examines the role of general international law in the World Trade Organization (WTO) regime, using the rules on state responsibility as a case study. It identifies and discusses instances in WTO case law where such rules were applied directly or were taken into consideration in interpreting relevant WTO provisions. The analysis demonstrates that direct application of general international law for the determination of indispensable matters not regulated by the WTO Agreements is part of the inherent powers of WTO adjudicative bodies. Moreover, under Article 3(2) Dispute Settlement Understanding and Article 31(3)(c) Vienna Convention on the Law of Treaties, WTO adjudicative bodies have an obligation to take into account general international law in interpreting relevant WTO provisions. The paper delineates the methodology for assessing the interaction between general international law and WTO law and highlights the importance of adhering to this methodology to provide clarity and legal certainty regarding the scope and content of WTO obligations.

Host States’ Due Diligence Obligation Towards Foreign Investors in the Context of Rebellions and Civil Wars

Based on an analysis of State practice and case law, this article examines one basic principle of international law embodied in Article 10 of the International Law Commission’s Articles on State responsibility. In the context of an unsuccessful insurrection or civil war, the host State is responsible for its own failure to discharge its due diligence obligation to protect foreign investors in relation to acts committed by rebels, i.e. to make all efforts within its capacity to suppress an insurrection and to take all reasonable measures to prevent injurious conduct by rebels and damages from occurring. This article examines the scope and content of this ‘duty to protect’ obligation, the applicable ‘test’ and the relevant circumstances to determine whether any breach of the obligation has been committed in light of recent investment awards analysing the full protection and security clause in the context of Libya’s civil war.