Basic Documents on International Investment Protection 9781509907854, 9781509907847, 9781509907823

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This is a remarkable collection, carefully chosen and instructive for novice and expert alike. Professor Paparinskis has put together not only an indispensable reference tool but an outline of the historical progression of international investment law sure to provide fodder for study and debate. Andrea K. Bjorklund, L. Yves Fortier Chair in International Arbitration and International Commercial Law, McGill University Faculty of Law A must-have companion for all those interested and involved in international investment law. A fine presentation of this multifaceted body of law with a wealth of different instruments, comprising an adroit consideration of possible normative and institutional evolutions in the field. Laurence Boisson de Chazournes, Professor of International Law, University of Geneva An eclectic effort in a rarefied and complex discipline of international investment law. This book is a compelling reference for every policy maker in the investment treaty world. Anwar H Shaik, Department of Economic Affairs, Ministry of Finance, Government of India From the reviews of the 1st edition: This book draws together an eclectic collection of core texts in the field of international investment law. Collated by Dr Martins Paparinskis, a rising scholar of public international law, the book will serve as a helpful compendium and quick reference point for students, academics and practitioners. Anthony Sinclair and Philip Devenish, Quinn Emanuel Urquhart & Sullivan, Global Arbitration Review

ii

Basic Documents on International Investment Protection

Documents in International Law General Editor: Professor Stefan Talmon Director at the Institute of Public International Law, University of Bonn, and Supernumerary Fellow of St. Anne’s College, Oxford

ALSO IN THIS SERIES THE LEGAL ORDER OF THE OCEANS Vaughan Lowe and Stefan Talmon (2009) THE IRAN NUCLEAR ISSUE Yaël Ronen (2010) TERRORISM Ben Saul (2012) BASIC DOCUMENTS ON INTERNATIONAL INVESTMENT PROTECTION Martins Paparinskis (2012) THE SETTLEMENT OF INTERNATIONAL DISPUTES: BASIC DOCUMENTS Christian Tams and Antonios Tzanakopoulos (2012) ANTARCTICA IN INTERNATIONAL LAW Ben Saul and Tim Stephens (2015) THE ARCTIC IN INTERNATIONAL LAW AND POLICY Kristina Schönfeldt (2017)

Basic Documents on International Investment Protection Second Edition

Martins Paparinskis

HART PUBLISHING Bloomsbury Publishing Plc Kemp House, Chawley Park, Cumnor Hill, Oxford, OX2 9PH, UK HART PUBLISHING, the Hart/Stag logo, BLOOMSBURY and the Diana logo are trademarks of Bloomsbury Publishing Plc First published in Great Britain 2019 Copyright © Martins Paparinskis, 2019 Martins Paparinskis has asserted his right under the Copyright, Designs and Patents Act 1988 to be identified as Author of this work. All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying, recording, or any information storage or retrieval system, without prior permission in writing from the publishers. While every care has been taken to ensure the accuracy of this work, no responsibility for loss or damage occasioned to any person acting or refraining from action as a result of any statement in it can be accepted by the authors, editors or publishers. All UK Government legislation and other public sector information used in the work is Crown Copyright ©. All House of Lords and House of Commons information used in the work is Parliamentary Copyright ©. This information is reused under the terms of the Open Government Licence v3.0 (http://www. nationalarchives.gov.uk/doc/open-government-licence/version/3) except where otherwise stated. All Eur-lex material used in the work is © European Union, http://eur-lex.europa.eu/, 1998–2019. A catalogue record for this book is available from the British Library. Library of Congress Cataloging-in-Publication data Names: Paparinskis, Martins., editor. Title: Basic documents on international investment protection / Martins Paparinskis. Description: Second edition.  |  Oxford ; Chicago, Illinois : Hart, an imprint of Bloomsbury, 2019.  |  Series: Documents in international law  |  Includes bibliographical references and index. Identifiers: LCCN 2018054469 (print)  |  LCCN 2018057187 (ebook)  |  ISBN 9781509907830 (EPub)  |  ISBN 9781509907854 (paperback)  |  ISBN 9781509907823 (ePDF) Subjects: LCSH: Investments, Foreign (International law)—Sources.  |  BISAC: LAW / International.  |  LAW / Legal Education.  |  LCGFT: Treaties. Classification: LCC K3828 (ebook)  |  LCC K3828 .B37 2019 (print)  |  DDC 346/.092—dc23 LC record available at https://lccn.loc.gov/2018054469 ISBN: PB: 978-1-50990-785-4 ePDF: 978-1-50990-782-3 ePub: 978-1-50990-783-0 Typeset by Compuscript Ltd, Shannon

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Editor’s Preface A key feature of contemporary international law of investment protection is the number and variety of authorities that may become relevant in the dispute settlement process: treaty and customary rules defining the primary obligations, customary law of State responsibility, different dispute settlement mechanisms provided by the treaties and other rules that may have bearing on the conduct of dispute settlement process, and finally, rules addressing the enforcement of award and implementation of responsibility. This book seeks to reproduce in a single volume the documents with most relevance to the historical development, creation, interpretation and application of modern investment protection law, as well as its possible future directions, and to supplement them with a subject index for ease of reference. The documents are organised in chronological order. Each document is allocated a unique document number in the table of contents and thereafter navigation within the book is by document number, not page number. References to documents in the list of documents, footnotes and the subject index also use the document number, which can be found at the top outside corner of each page. Ira Ryk-Lakhman provided helpful research assistance in the preparation of this volume. Martins Paparinskis London, September 2018

viii

Contents Editor’s Preface vii List of Documents Arranged According to Subject Matter xi List of Documents in Chronological Order xvii List of Documents in Alphabetical Order xxi Abbreviationsxxv Introduction1 A. Past 5 B. International Investment Law 91 C. International Investment Arbitration 353 D. Miscellaneous Documents  657 E. Future 717 F. Appendix 861 Index871

x

List of Documents Arranged According to Subject Matter [Document numbers can be found in the top outside corner of each page]

A. Past I. State Responsibility for Injuries to Aliens Resolution of the Institute of International Law on the International Responsibility of States for Damage Done in Their Territory to the Person or Property of Foreigners Harvard Draft Convention on the Responsibility of States for Damage Done in Their Territory to the Person or Property of Foreigners Text of Articles Adopted in First Reading by the Third Committee of the Conference for the Codification of International Law (The Hague, 1930) Harvard Draft Convention on the International Responsibility of States for Injuries to Aliens

[Doc no] 1 2 3 4

II. Friendship, Commerce and Navigation Treaties Treaty of Friendship, Commerce and Navigation between the United States of America and the Italian Republic [and Agreement Supplementing the AboveMentioned Treaty] Treaty of Amity, Economic Relations, and Consular Rights between the United States of America and Iran Treaty of Friendship, Commerce and Navigation between the United States of America and the Republic of Nicaragua

5

6 7

III. Human Rights Revised Draft on International Responsibility of the State for Injuries Caused in Its Territory to the Person or Property of Aliens

8

IV. General Assembly Resolutions UN General Assembly Resolution 1803 (XVII) Permanent Sovereignty over Natural Resources UN General Assembly Resolution 3201 (S-VI) Declaration on the Establishment of a New International Economic Order UN General Assembly Resolution 3281 (XXIX) Charter of Economic Rights and Duties of States

9 10 11

List of Documents Arranged According to Subject Matter

V. Investment Protection Treaties Abs-Shawcross Draft Convention on Investment Abroad OECD Draft Convention on the Protection of Foreign Property Treaty between the Federal Republic of Germany and Pakistan for the Promotion and Protection of Investments Agreement between the Kingdom of Belgium and the Republic of Indonesia on the Encouragement and Reciprocal Protection of Investments Iran-US Claims Tribunal’s Claims Settlement Declaration

12 13 14 15 16

B. International Investment Law I. Generalist Materials Vienna Convention on the Law of Treaties International Law Commission’s Articles on Responsibility of States for Internationally Wrongful Acts International Law Commission’s Articles on Diplomatic Protection International Law Commission’s Guiding Principles Applicable to Unilateral Declarations of States Capable of Creating Legal Obligations International Law Commission’s Articles on Responsibility of International Organizations for Internationally Wrongful Acts International Law Commission’s Draft Conclusions on Subsequent Agreements and Subsequent Practice in Relation to Interpretation of Treaties International Law Commission’s Draft Conclusions on Identification of Customary International Law

17 18 19 20 21 22 23

II. Multilateral Rules Agreement for the Promotion and Guarantee of Investment among Member States of the Organisation of the Islamic Conference Convention Establishing the Multilateral Investment Agreement Agency World Bank Guidelines on the Treatment of Foreign Investment North American Free Trade Agreement Energy Charter Treaty Dominican Republic–Central America Free Trade Agreement ASEAN Comprehensive Investment Agreement

24 25 26 27 28 29 30

III. Bilateral Rules Agreement between the Government of the United Kingdom of Great Britain and Northern Ireland and the Government of the Arab Republic of Egypt for the Promotion and Protection of Investments xii

31

List of Documents Arranged According to Subject Matter

Treaty between the Federal Republic of Germany and the Argentine Republic on the Encouragement and Reciprocal Protection of Investments Agreement on Encouragement and Reciprocal Protection of Investments between the Kingdom of the Netherlands and the Czech and Slovak Federal Republic Agreement between the Government of the French Republic and the Government of the Republic of Argentina on the Reciprocal Promotion of Investments Agreement between the Argentine Republic and the Kingdom of Spain on the Reciprocal Promotion and Protection of Investments Agreement on Encouragement and Reciprocal Protection of Investments between the Republic of Venezuela and the Kingdom of the Netherlands Treaty between the United States of America and the Republic of Argentina on the Encouragement and Reciprocal Protection of Investments Treaty between the United States of America and the Republic of Ecuador on the Encouragement and Reciprocal Protection of Investments Agreement between the Republic of Turkey and Turkmenistan Concerning the Reciprocal Promotion and Protection of Investments Agreement between the Government of the Russian Federation and Cabinet of Ministers of the Ukraine on the Encouragement and Mutual Protection of Investments

32 33 34 35 36 37 38 39 40

C. International Investment Arbitration I. International Centre for the Settlement of Investment Disputes Convention on the Settlement of Investment Disputes between States and Nationals of Other States Report of the Executive Directors of the International Bank for the Reconstruction and Development on the Convention on Settlement of Investment Disputes between States and Nationals of Other States Administrative and Financial Regulations

41

Rules of Procedure for the Institution of Conciliation and Arbitration Proceedings (Institution Rules) Rules of Procedure for Conciliation Proceedings (Conciliation Rules)

44

Rules of Procedure for Arbitration Proceedings (Arbitration Rules)

46

42

43

45

II. Additional Facility of the International Centre for the Settlement of Investment Disputes 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) Schedule A – Fact-Finding (Additional Facility) Rules

47

48

xiii

List of Documents Arranged According to Subject Matter

Schedule B – Conciliation (Additional Facility) Rules

49

Schedule C – Arbitration (Additional Facility) Rules

50

III. UNCITRAL Convention on the Recognition and Enforcement of Foreign Arbitral Awards

51

Arbitration Rules of the United Nations Commission on International Trade Law

52

UNCITRAL Model Law on International Commercial Arbitration

53

UNCITRAL Arbitration Rules as revised in 2010

54

UNCITRAL Rules on Transparency in Treaty-based Investor-State Arbitration

55

UN Convention on Transparency in Treaty-based Investor-State Arbitration

56

IV. Permanent Court of Arbitration Permanent Court of Arbitration Optional Rules for Arbitrating Disputes between Two Parties of Which Only One is a State Permanent Court of Arbitration Optional Rules for Arbitration of Disputes Relating to Natural Resources and/or Environment Permanent Court of Arbitration Arbitration Rules

57 58 59

V. Other Arbitral Institutions London Court of International Arbitration Arbitration Rules

60

Arbitration Rules of the Arbitration Institute of the Stockholm Chamber of Commerce International Investment Arbitration Rules of the Singapore International Arbitration Centre International Chamber of Commerce Rules of Arbitration

61 62 63

D. Miscellaneous Documents United Nations Convention on Jurisdictional Immunities of States and Their Property

64

International Bar Association Rules on the Taking of Evidence in International Arbitration UN Guiding Principles on Business and Human Rights

65

International Bar Association Guidelines on Conflicts of Interest in International Arbitration

67

xiv

66

List of Documents Arranged According to Subject Matter

E. Future I. Investor-State Arbitration 2.0 Free Trade Agreement between the Government of the People’s Republic of China and the Government of the Republic of Korea Model Text for the Indian Bilateral Investment Treaty Comprehensive and Progressive Agreement for Trans-Pacific Partnership

68 69 70

II. Inter-State Arbitration Cooperation and Facilitation Agreement between the Federative Republic of Brazil and the Republic of Suriname

71

III. International Investment Court Comprehensive Economic and Trade Agreement (CETA) between Canada, of the one part, and the European Union and its Member States, of the other part Negotiating Directives for Establishing a Multilateral Court for the Settlement of Investment Disputes

72 73

IV. Investor–State Mediation International Bar Association Rules for Investor–State Mediation

74

xv

xvi

List of Documents in Chronological Order 1927 Resolution of the Institute of International Law on the International Responsibility of States for Damage Done in Their Territory to the Person or Property of Foreigner 1929 Harvard Draft Convention on the Responsibility of States for Damage Done in Their Territory to the Person or Property of Foreigner 1930 Text of Articles Adopted in First Reading by the Third Committee of the Conference for the Codification of International Law (The Hague, 1930) 1948 Treaty of Friendship, Commerce and Navigation between the United States of America and the Italian Republic [and the 1951 Agreement Supplementing the Above-Mentioned Treaty] 1955 Treaty of Amity, Economic Relations, and Consular Rights between the United States of America and Iran 1956 Treaty of Friendship, Commerce and Navigation between the United States of America and the Republic of Nicaragua 1958 Convention on the Recognition and Enforcement of Foreign Arbitral Awards. 1959 Abs-Shawcross Draft Convention on Investment Abroad 1959 Treaty between the Federal Republic of Germany and Pakistan for the Promotion and Protection of Investments 1961 Harvard Draft Convention on the International Responsibility of States for Injuries to Aliens 1961 Revised Draft on International Responsibility of the State for Injuries Caused in Its Territory to the Person or Property of Aliens 1962 UN General Assembly Resolution 1803 (XVII) Permanent Sovereignty over Natural Resources 1965 Convention on the Settlement of Investment Disputes between States and Nationals of Other States 1965 Report of the Executive Directors of the International Bank for the Reconstruction and Development on the Convention on Settlement of Investment Disputes between States and Nationals of Other States 1967 OECD Draft Convention on the Protection of Foreign Property 1969 Vienna Convention on the Law of Treaties 1970 Agreement between the Kingdom of Belgium and the Republic of Indonesia on the Encouragement and Reciprocal Protection of Investments 1974 UN General Assembly Resolution 3201 (S-VI) Declaration on the Establishment of a New International Economic Order 1974 UN General Assembly Resolution 3281 (XXIX) Charter of Economic Rights and Duties of States

1

2 3 5

6 7 51 12 14 4 8 9 41 42

13 17 15 10 11

List of Documents in Chronological Order

1975 Agreement between the Government of the United Kingdom of Great Britain and Northern Ireland and the Government of the Arab Republic of Egypt for the Promotion and Protection of Investments 1976 Arbitration Rules of the United Nations Commission on International Trade Law 1981 Agreement for the Promotion, Protection and Guarantee of Investment among Member States of the Organisation of the Islamic Conference 1981 Iran-US Claims Tribunal’s Claims Settlement Declaration 1985 Convention Establishing the Multilateral Investment Guarantee Agency 1985 Model Law on International Commercial Arbitration 1991 Treaty between the Federal Republic of Germany and the Argentine Republic on the Encouragement and Reciprocal Protection of Investments 1991 Agreement on Encouragement and Reciprocal Protection of Investments between the Kingdom of the Netherlands and the Czech and Slovak Federal Republic. 1991 Agreement between the Government of the French Republic and the Government of the Republic of Argentina on the Reciprocal Promotion and Protection of Investments 1991 Agreement between the Argentine Republic and the Kingdom of Spain on the Reciprocal Promotion and Protection of Investments 1991 Agreement on Encouragement and Reciprocal Protection of Investments between the Republic of Venezuela and the Kingdom of the Netherlands 1991 Treaty between the United States of America and the Republic of Argentina Concerning the Encouragement and Reciprocal Protection of Investment 1992 World Bank Guidelines on the Treatment of Foreign Direct Investment 1992 North American Free Trade Agreement 1992 Agreement between the Republic of Turkey and Turkmenistan Concerning the Reciprocal Promotion and Protection of Investments 1993 Treaty between the United States of America and the Republic of Ecuador Concerning the Encouragement and Reciprocal Protection of Investment 1993 Permanent Court of Arbitration Optional Rules for Arbitrating Disputes between Two Parties of Which Only One is a State 1994 Energy Charter Treaty 1998 Agreement between the Government of the Russian Federation and Cabinet of Ministers of the Ukraine on the Encouragement and Mutual Protection of Investments 2001 International Law Commission’s Articles on Responsibility of States for Internationally Wrongful Acts 2001 Permanent Court of Arbitration Optional Rules for Arbitration of Disputes Relating to Natural Resources and/or Environment 2004 Dominican Republic–Central America Free Trade Agreement

xviii

31

52 24 16 25 53 32 33

34

35 36 37 26 27 39 38 57 28 40

18 58 29

List of Documents in Chronological Order

2004 UN Convention on Jurisdictional Immunities of States and Their Property 2006 International Law Commission’s Articles on Diplomatic Protection 2006 International Law Commission’s Guiding Principles Applicable to Unilateral Declarations of States Capable of Creating Legal Obligations 2006 ICSID Administrative and Financial Regulations 2006 ICSID Rules of Procedure for the Institution of Conciliation and Arbitration Proceedings (Institution Rules) 2006 ICSID Rules of Procedure for Conciliation Proceedings (Conciliation Rules) 2006 ICSID Rules of Procedure for Arbitration Proceedings (Arbitration Rules) 2006 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 Schedule A Fact-Finding (Additional Facility) Rules 2006 Schedule B Conciliation (Additional Facility) Rules 2006 Schedule C Arbitration (Additional Facility) Rules 2009 ASEAN Comprehensive Investment Agreement 2010 UNCITRAL Arbitration Rules 2010 International Bar Association Rules on the Taking of Evidence in International Arbitration. 2011 International Law Commission’s Articles on Responsibility of International Organizations for Internationally Wrongful Acts 2011 UN Guiding Principles on Business and Human Rights 2012 International Bar Association Rules for Investor-State Mediation 2014 International Bar Association Guidelines on Conflicts of Interest in International Arbitration 2014 UNCITRAL Rules on Transparency in Treaty-Based Investor-State Arbitration 2014 UN Convention on Transparency in Treaty-Based Investor-State Arbitration 2014 London Court of International Arbitration Rules 2015 Free Trade Agreement between the Government of the People’s Republic of China and the Government of the Republic of Korea 2015 Model Text for the Indian Bilateral Investment Treaty 2016 Comprehensive Economic and Trade Agreement (CETA) between Canada, of the one part, and the European Union and its Member States, of the other part 2017 Arbitration Rules of the Arbitration Institute of the Stockholm Chamber of Commerce 2017 International Investment Arbitration Rules of the Singapore International Arbitration Centre

64 19 20 43 44 45 46 47

48 49 50 30 54 65 21 66 74 67 55 56 60 68 69 72

61 62

xix

List of Documents in Chronological Order

2017 International Chamber of Commerce Rules of Arbitration 2018 International Law Commission’s Draft Conclusions on Subsequent Agreements and Subsequent Practice in Relation to Interpretation of Treaties 2018 International Law Commission’s Draft Conclusions on Identification of Customary International Law 2018 Comprehensive and Progressive Agreement for Trans-Pacific Partnership 2018 Cooperation and Facilitation Agreement between the Federative republic of Brazil and the republic of Suriname 2018 Negotiating Directives for Establishing a Multilateral Court for the Settlement of Investment Disputes

xx

63 22

23 70 71 73

List of Documents in Alphabetical Order Abs-Shawcross Draft Convention on Investment Abroad Administrative and Financial Regulations Agreement between the Argentine Republic and the Kingdom of Spain on the Reciprocal Promotion and Protection of Investments Agreement between the Government of the French Republic and the Government of the Republic of Argentina on the Reciprocal Promotion and Protection of Investments Agreement between the Government of the Russian Federation and Cabinet of Ministers of the Ukraine on the Encouragement and Mutual Protection of Investments Agreement between the Government of the United Kingdom of Great Britain and Northern Ireland and the Government of the Arab Republic of Egypt for the Promotion and Protection of Investments Agreement between the Kingdom of Belgium and the Republic of Indonesia on the Encouragement and Reciprocal Protection of Investments Agreement between the Republic of Turkey and Turkmenistan Concerning the Reciprocal Promotion and Protection of Investments Agreement for the Promotion, Protection and Guarantee of Investment among Member States of the Organisation of the Islamic Conference Agreement on Encouragement and Reciprocal Protection of Investments between the Kingdom of the Netherlands and the Czech and Slovak Federal Republic Agreement on Encouragement and Reciprocal Protection of Investments between the Republic of Venezuela and the Kingdom of the Netherlands Arbitration Rules of the Arbitration Institute of the Stockholm Chamber of Commerce Arbitration Rules of the United Nations Commission on International Trade Law ASEAN Comprehensive Investment Agreement Comprehensive and Progressive Agreement for Trans-Pacific Partnership Comprehensive Economic and Trade Agreement (CETA) between Canada, of the one part, and the European Union and its Member States, of the other part Convention Establishing the Multilateral Investment Guarantee Agency Convention on the Recognition and Enforcement of Foreign Arbitral Awards Convention on the Settlement of Investment Disputes between States and Nationals of Other States Cooperation and Facilitation Agreement between the Federative Republic of Brazil and the Republic of Suriname Dominican Republic–Central America Free Trade Agreement Energy Charter Treaty

12 43 35 34

40

31

15 39 24 33 36 61 52 30 70 72 25 51 41 71 29 28

List of Documents in Alphabetical Order

Free Trade Agreement between the Government of the People’s Republic of China and the Government of the Republic of Korea Harvard Draft Convention on the International Responsibility of States for Injuries to Aliens Harvard Draft Convention on the Responsibility of States for Damage Done in Their Territory to the Person or Property of Foreigner International Bar Association Guidelines on Conflicts of Interest in International Arbitration International Bar Association Rules for Investor-State Mediation International Bar Association Rules on the Taking of Evidence in International Arbitration International Chamber of Commerce Rules of Arbitration International Investment Arbitration Rules of the Singapore International Arbitration Centre International Law Commission’s Articles on Diplomatic Protection International Law Commission’s Articles on Responsibility of International Organizations for Internationally Wrongful Act International Law Commission’s Articles on Responsibility of States for Internationally Wrongful Acts International Law Commission’s Draft Conclusions on Identification of Customary International Law International Law Commission’s Draft Conclusions on Subsequent Agreements and Subsequent Practice in Relation to Interpretation of Treaties International Law Commission’s Guiding Principles Applicable to Unilateral Declarations of States Iran-US Claims Tribunal’s Claims Settlement Declaration London Court of International Arbitration Arbitration Rules Model Law on International Commercial Arbitration of the United Nations Commission on International Trade Law Model Text for the Indian Bilateral Investment Treaty Negotiating Directives for Establishing a Multilateral Court for the Settlement of Investment Disputes North American Free Trade Agreement OECD Draft Convention on the Protection of Foreign Property Permanent Court of Arbitration Arbitration Rules Permanent Court of Arbitration Optional Rules for Arbitrating Disputes between Two Parties of Which Only One is a State

68

Permanent Court of Arbitration Optional Rules for Arbitration of Disputes Relating to Natural Resources and/or Environment

58

xxii

4 2 67 74 65 63 62 19 21 18 23 22 20 16 60 53 69 73 27 13 59 57

List of Documents in Alphabetical Order

Report of the Executive Directors of the International Bank for the Reconstruction and Development on the Convention on Settlement of Investment Disputes between States and Nationals of Other States Resolution of the Institute of International Law on the International Responsibility of States for Damage Done in Their Territory to the Person or Property of Foreigner Revised Draft on International Responsibility of the State for Injuries Caused in Its Territory to the Person or Property of Aliens 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) Rules of Procedure for Arbitration Proceedings (Arbitration Rules) Rules of Procedure for Conciliation Proceedings (Conciliation Rules) Rules of Procedure for the Institution of Conciliation and Arbitration Proceedings (Institution Rules) Schedule A Fact-Finding (Additional Facility) Rules Schedule B Conciliation (Additional Facility) Rules Schedule C Arbitration (Additional Facility) Rules Text of Articles Adopted in First Reading by the Third Committee of the Conference for the Codification of International Law (The Hague, 1930) Treaty between the Federal Republic of Germany and Pakistan for the Promotion and Protection of Investments Treaty between the Federal Republic of Germany and the Argentine Republic on the Encouragement and Reciprocal Protection of Investments Treaty between the United States of America and the Republic of Argentina Concerning the Encouragement and Reciprocal Protection of Investment Treaty between the United States of America and the Republic of Ecuador Concerning the Encouragement and Reciprocal Protection of Investment Treaty of Amity, Economic Relations, and Consular Rights between the United States of America and Iran Treaty of Friendship, Commerce and Navigation between the United States of America and the Italian Republic Treaty of Friendship, Commerce and Navigation between the United States of America and the Republic of Nicaragua UN Convention on Jurisdictional Immunities of States and Their Property UN Convention on Transparency in Treaty-Based Investor-State Arbitration UN General Assembly Resolution 1803 (XVII) Permanent Sovereignty over Natural Resources UN General Assembly Resolution 31/98 Arbitration Rules of the United Nations Commission on International Trade Law UN General Assembly Resolution 3201 (S-VI) Declaration on the Establishment of a New International Economic Order

42

1

8 47

46 45 44 48 49 50 3 14 32 37 38 6 5 7 64 56 9 52 10

xxiii

List of Documents in Alphabetical Order

UN General Assembly Resolution 3281 (XXIX) Charter of Economic Rights and Duties of States UN Guiding Principles on Business and Human Rights UNCITRAL Arbitration Rules as revised in 2010 UNCITRAL Rules on Transparency in Treaty-Based Investor-State Arbitration Vienna Convention on the Law of Treaties World Bank Guidelines on the Treatment of Foreign Direct Investment

xxiv

11 66 54 55 17 26

Abbreviations AEM AFTA AIA ASEAN BIT BOP CCI CETA CPTPP DR–CAFTA DTT ECT EC EU FCN FDI G7 GATS GATT ICC ICJ ICSID IDI IIA ILC IMF LCIA MERCOSUR MIGA MFN NAFTA NYC OECD PCA PCIJ SCC SIAC SDR SPS TBT TPP TRIPS

ASEAN Economic Ministers ASEAN Free Trade Area ASEAN Investment Area Association of Southeast Asian Nations Bilateral Investment Treaty Balance of Payments Co-ordinating Committee on Investment Comprehensive Economic and Trade Agreement Comprehensive and Progressive Trans-Pacific Partnership Dominican Republic–Central American Free Trade Agreement Double Taxation Treaty Energy Charter Treaty European Community European Union Friendship, Commerce and Navigation Foreign Direct Investment Group of Seven General Agreement on Trade in Services General Agreement on Tariffs and Trade International Chamber of Commerce International Court of Justice International Centre for the Settlement of Investment Disputes Institut de droit international International Investment Agreement International Law Commission International Monetary Fund London Court of International Arbitration Mercado Común del Sur (Common Southern Market) Multilateral Investment Guarantee Agency Most Favoured Nation North American Free Trade Agreement New York Convention Organisation for Economic Co-operation and Development Permanent Court of Arbitration Permanent Court of International Justice Stockholm Chamber of Commerce Singapore International Arbitration Centre Special Drawing Rights Sanitary and Phytosanitary Technical Barriers to Trade Trans-Pacific Partnership Trade-Related Aspects of Intellectual Property Rights

Abbreviations

UNCITRAL UNCTAD UPOV WB WIPO WTO

xxvi

United Nations Commission on International Trade Law United Nations Conference on Trade and Development Union for the Protection of New Varieties of Plants World Bank World Intellectual Property Organization World Trade Organization

Introduction International investment law is a field of public international law, and in many ways not a particularly remarkable one. All the elements that appear peculiar – say, vague primary obligations under treaties or customary international law, significant monetary awards under customary rules of State responsibility, international arbitration as a mode of international dispute settlement, procedural rights of non-State actors under international law – are common and well-known tools and techniques of international law. Still, one key characteristic that may be peculiar, in degree if not kind, is the extent of substantive and procedural decentralisation of the field: both substantive obligations and bodies of international dispute settlement are mostly opposable only to the particular parties, even when expressed in multilateral form. Such decentralisation raises interesting questions of conceptual and practical character. In a more mundane sense, it also makes the task of arranging basic documents of investment protection law in a representative and useful manner somewhat challenging. Another consideration, more significant now than in 2011 when the first edition of Basic Documents on Investment Protection was prepared, is the considerable political support for a number of strong and substantively varied proposals for changes to this field. The second edition therefore takes a slightly different structural approach that hopefully better reflects the concurrence of reform proposals regarding the future with the fairly stable stratum of instruments that inform the current practice. With that in mind, documents are divided into three parts: Past, Present, and Future.1 The Past of investment protection law is addressed in Part A, setting out the legal background to the modern investment protection law. These documents make a point that may be obvious but nevertheless deserves to be spelled out: modern investment protection law, essentially bilateral(isable) in substance and procedurally implemented through investor-State arbitration, is not the only way that international law can deal with such matters. An appreciation of the historical perspective will improve both the quality of engagement with current rules as well as evaluation of future proposals. Part A addresses in turn, and in a loosely chronological manner, the treatment of investment protection law as part of the law of State responsibility (A.I), within the traditional inter-State Friendship, Commerce, and Navigation Treaties (II), synthesised with human rights (III), challenged through the United Nations General Assembly (IV), and, finally, articulated through predecessors to modern investment protection treaties (included are various drafts, first bilateral investment treaty (BIT), and first BIT with investor-State arbitration clause) (V). The list of historical materials has not significantly changed from the first edition, with some of the less important documents lightly trimmed and the Iran-US Claims Tribunal’s materials added, in light of their continued relevance (and as a retrospective investment treaty of sorts2). Past, as many clichés attest, is never properly passed, and historical 1 

Norns, Moirai etc. D Caron, ‘The Iran-U.S. Claims Tribunal and Investment Arbitration: Understanding the Claims Settlement Declaration as a Retrospective BIT’ in CR Drahozal and CS Gibson (eds), The Iran-US Claims Tribunals at 25 (OUP 2007). 2 

1

Introduction

alternatives may also be employed as arguments of interpretation, criticism, or reform of current law, or indeed as valid means of implementation of investment protection outside the mixed arbitral paradigm.3 The Present of investment protection law is addressed in Parts B, C, and D. The line between substance and procedure may be an inexact and arbitrary one, particularly in investment law. Still, it has to be drawn somewhere for purposes of distribution of material, and Part B covers investment protection law, Part C deals with international investment arbitration, and Part D includes certain important miscellaneous instruments that do not quite fall within either category. International investment law is a field of public international law, and Part B first sets out the vocabulary of generalist international law (B.I). The materials of law of treaties, State responsibility, and diplomatic protection that were included in the first edition have been supplemented by some more recent International Law Commission’s documents, of which the 2018 conclusions on custom and subsequent practice and agreement will be of particular interest.4 Parts B.II and III include respectively multilateral and bilateral rules of investment protection. In line with the first edition’s benchmark, the most influential (arbitrated) instruments are provided, investment protection treaties in full and free trade agreements to the extent that materials are directly relevant to investment protection issues. The selected multilateral instruments are mostly unchanged, with some trimming of MERCOSUR and early ASEAN materials. Model bilateral treaties have been dropped from this section (partly for reasons of space and partly because the influential ones are mostly reflected in actual treaty instruments), along with those BITs that have somewhat faded from dispute settlement in recent years. Two new BITs have now made the ‘most arbitrated’ list (Turkey-Turkmenistan and Russia-Ukraine). Part C sets out the rules relevant for investor-State arbitration. It follows the structure of the first edition, dealing in turn the documents for ICSID arbitration (C.I), ICSID Additional Facility (II), UNCITRAL (III), Permanent Court of Arbitration (PCA) (IV), and the catch-all rubric of ‘other arbitral institutions’ (V). The reader should note that the first two sections are likely to be partially superseded by the update to investment dispute settlement rules currently proposed by ICSID.5 Part C also adds the work of UNCITRAL on transparency issues in investment arbitration, the new versions of arbitration rules by the PCA (2012), London Court of International Arbitration (2014), Stockholm Chamber of Commerce (2017), and International Chamber of Commerce (2017), as well as investment arbitration rules of the Singapore International Arbitration Centre (2017). Part D concludes coverage of the current field with a number of important miscellaneous instruments, including the 2011 UN Guiding Principles on Business and Human Rights.

3 E.g. Certain Iranian Assets (Iran v US) ICJ; Alleged Violations of the 1955 Treaty of Amity, Economic Relations and Consular Rights (Iran v US) ICJ. 4 International Law Commission’s Draft Conclusions on Subsequent Agreement Subsequent Practice in Relation to the Interpretation of Treaties, Official Records of the General Assembly, Seventy-third Session, Supplement No. 10, UN Doc A/73/10 12; International Law Commission’s Draft Conclusions on Identification of Customary International Law, Official Records of the General Assembly, Seventy-third Session, Supplement No. 10, UN Doc A/73/10 119. 5  ICSID News Release, ‘ICSID Proposes Updates to Investment Dispute Settlement Rules’ (3 August 2018) , and generally .

2

Introduction

The Future of investment protection law is dealt with in Part E. The first possible future is the present.6 Investor-State Arbitration 2.0 (Part E.I) maintains the procedural kernel of investor-State arbitration but otherwise comes in very different guises, of which I have chosen three: the future of China, the future of India, and the future-of-the-US (-withoutthe-US).7 The second possible future is the past: traditional centuries-old investment protection law of inter-State implementation of responsibility through diplomatic protection, adopted in the Brazilian practice (Part E.II). The third possible future is, as it were, the future. If the arch of international justice bends towards multilateralism, it seems only natural for every reasonable (European) person to call for an(other) international court to centralise the discipline (III).8 Finally, perhaps the real problem of the discipline is its excessive focus on formalised dispute settlement, which could be tempered by greater reliance on mediation and conciliation (IV). Just as in public international law more generally, the likeliest future for this particular field is decentralised and pluralist, partaking from various and varied influences.

6 

Leopard etc. Comprehensive and Progressive Agreement for Trans-Pacific Partnership (Done at Santiago, 8 March 2018; entry into force, 30 December 2018)