The ICSID Procedure: Mind the Gap
| Autor | Gloria María Álvarez |
| Cargo | LL.M in Comparative and Alternative Dispute Resolution at Queen Mary, University of London |
| Páginas | 163-202 |
REVIST@ e – Mercatoria Volumen 10, Número 2 (julio – diciembre
2011)
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Universidad Externado de Colombia. Departamento de Derecho Comercial
The ICSID Procedure: Mind the gap
Gloria María Álvarez
1
Abstract
International Investment Law is constantly changing; therefore the mechanisms available to
solve its disputes have evolved. The International Centre for Settlement of Investment
Disputes (ICSID) is the most important arbitral institution capable of administrate disputes
between investors and member States of the Washington Convention. The annulment
activity of ICSID awards has significantly increased in recent years. This paper explores all
the variables affecting the annulment activity and suggests effective solutions in order to
achieve the desirable Finality Principle in ICSID awards.
Key Words: Investments, World Bank, Annulment activity, Finality Principle, ICSID,
Washington Convention, Bilateral Investment Treaties, Argentina, Vivendi and Sempra
Resumen
El Derecho Internacional de Inversión, está en constante desarrollo, por lo tanto, los
mecanismos disponibles para solucionar sus controversias también han evolucionado. El
Centro Internacional de Arreglo de Diferencias Relativas a Inversiones (CIADI), es la
institución arbitral más importante en la materia, capaz de administrar controversias entre
Inversionistas y Estados Miembros de la Convención de Washington. La anulación en
laudos del CIADI ha aumentado dramáticamente en el reciente año, por esta razón, el
presente artículo explora las diferentes variables que afectan la actividad de laudos
anulados, así como propone soluciones eficaces para conseguir un principio de finalidad
deseable en laudo arbitrales finales.
Palabras Clave: Inversiones, Banco Mundial, Anulación de Laudos, Principio de Finalidad,
Convención de Washington, Tratados Bilaterales de Inversión, Argentina, Vivendi y
Sempra.
Este artículo fue presentado a la revista el día 7 de Septiembre de 2011 y fue aceptado para su
publicación por el Comité Editorial el día 24 de noviembre de 2011, previa revisión del concepto
emitido por el árbitro evaluador.
1
LL.M in Comparative and Alternative Dispute Resolution at Queen Mary, University of London. GM
Alvarez is a Reporter on the International Arbitration Case Law (IACL). Mexico.
alvarez.gloriamaria@gmail.com. The author wishes to thanks Professor Loukas Mistelis for his
contribution on this research.
REVIST@ e – Mercatoria Volumen 10, Número 2 (julio – diciembre
2011)
(Rev. e-mercatoria)
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Universidad Externado de Colombia. Departamento de Derecho Comercial
SUMMARY
Introduction and Foundations ....................................................................................... 165
Introduction ................................................................................................................. 165
Foundations ................................................................................................................ 168
Chapter I ......................................................................................................................... 169
1.1 The Arbitral Procedure at ICSID ...................................................................... 169
1.2 Generations Of Setting Aside Proceedings ................................................... 174
CHAPTER II ..................................................................................................................... 181
2.1 Lack Of ICSID Jurisprudence ............................................................................. 181
2.2 The Ad Hoc Committee. Court of Appeal or Court of Annulment? ................. 185
2.3 The Gaps on ICSID Annulment Procedure ......................................................... 189
2.4 The Impact of the Investment Treaties on the Annulment Activity .................. 190
2.5 Same Parties, Several Annulments? Or Different Parties, Several Annulments?
..................................................................................................................................... 193
Chapter III ....................................................................................................................... 195
3.1 Investment Community. Brief Proposals and Silent Solutions. ...................... 195
3.2 The International Court Of Justice ..................................................................... 195
Conclusions.................................................................................................................... 197
References ...................................................................................................................... 199
REVIST@ e – Mercatoria Volumen 10, Número 2 (julio – diciembre
2011)
(Rev. e-mercatoria)
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Universidad Externado de Colombia. Departamento de Derecho Comercial
Introduction and Foundations
Introduction
International Investments between governments of developing countries and foreign private
investors with the capacity to assist developing countries are an essential activity for the
growth of any economy.
2
Investment transactions contribute immensely to utilize resources
in a more efficient way by achieving benefits for the host governments of the investment and
for the investors.
Worldwide organisations, institutions, chambers and rules among other structures have
been created to improve, regulate and discuss the International Investment activity. To
illustrate this, we can observe the World Bank, a financial institution, based in Washington,
D.C., composed by one hundred and eighty seven shareholders, all of them called Member
Countries
3
. One of the World Bank‘s primary objectives is to retrieve inconsistencies in the
International Investment framework. This purpose becomes an important incentive when the
investment is addressed to the economic progression of a developing country, where raw
material such as manpower and natural resources are present but there is lack of capital
and technology, which is usually possessed by the most industrialized countries.
Economical, environmental, political, legal and even cultural facts interact in all international
investments; thus disputes between a State and an investor have always existed and are a
latent possibility. All these potential obstacles increased the concern and aid the search for
mechanisms capable of settling disputes among Sates and investors.
Furthermore, the absence of an appropriate forum for the settlement of disputes that would
be reliable for international investors and the investment‘s host States used to present a
severe obstruction to the encouragement of investments in developing countries, which
motivated the international community to find a suitable solution capable of settling disputes
on a neutral forum.
4
Thus, in accordance with the World Bank proposal and in response to the absence of an
institution specialised on the administration of investment disputes; in 1966 the International
Centre for Settlement of Investment Disputes (ICSID) was founded as an independent
organisation. ICSID counts with more than 150 member countries, all of them signatories of
the Washington Convention (hereinafter the Convention), this body of rules is considered as
2
Christoph Scheruer, ―The Dynamic Evolution of the ICSID System‖ in Rainer Hofmann and
Christian J. Tams (eds.), The International Convention on the Settlement of Investment Disputes:
Taking a Stock after 40 Years (Europäischen Integration und Internationalen Wirtschaftsordnung, 7
Nomos, Baden-Baden 2007) 15
3
For More information about the World Bank go to
http://web.worldbank.org/WBSITE/EXTERNAL/EXTABOUTUS/0,,pagePK:50004410~piPK:36602~th
eSitePK:29708,00.html accessed on 22 July, 2011.
4
Moshe Hirsch, The Arbitration Mechanism of the International Center for the Settlement of
Investment Disputes, (Martinus Nijhoff Publishers, 1993) 17
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