Amicus Intervention in Investor-State Arbitration

Article excerpt

This article analyzes the legal standing of amid curiae in international trade and investment arbitration. Drawing on the most important decisions by the WTO Appellate Body and arbitral panels, the article emphasizes the fundamental tension between the traditional consent-based foundation of arbitration and the increasing need for transparency in proceedings that affect the public.

In the last several years, the idea that international investment arbitration should become more transparent has gained wide acceptance. Until quite recently, however, disputes between States and foreign investors were considered private as a matter of law. The main implication of this approach was the secrecy of the proceedings. While this paradigm is still dominant in the field of international commercial arbitration, it has been substantially weakened in the area of investor-state arbitration.1 It is now commonplace to make arbitral awards and/or other parts of the proceedings public. This is perfectly consistent with the subject matter of investor-state disputes, which in virtually all cases raise issues of public concern. Thus, reality has entered into the legal realm.

The issue of amicus curiae intervention in international investment disputes offers a good illustration of how this change came about.

In the last few years, a number of non-governmental organizations (NGOs) have successfully drawn upon the public character of trade and foreign investment disputes to gain access to the proceedings as amid curiae (meaning "friends of the court"). They have raised a variety of arguments, ranging from jurisdictional issues to environmental and human rights considerations. This article analyzes how the practice of amicus intervention spread from interstate adjudicatory bodies to investor-state arbitrations, focusing on the recent developments under the International Center for the Settlement of Investment Disputes (ICSID).

After a brief review of amicus practice within the context of the World Trade Organization (WTO) Dispute Settlement Body (DSB), and its influence on two well-known arbitrations heard under the International Arbitration Rules of the United Nations Commission on International Trade Law (UNCITRAL Rules) involving claims under the North American Free Trade Agreement (NAFTA), I turn to the recent orders issued in two ongoing cases conducted under ICSID rules.2

The WTO Precedents

Although international proceedings are not governed by any kind of formal rule or precedent, adjudicatory bodies tend to refer to the case law of other international bodies to support their decisions. These precedents, however, have limitations. It is rare to find an adjudicatory body that deals with economic issues making references to decisions by courts that specialize in human rights issues or vice versa, despite the fact that no legal obstacle prevents such cross-referencing. It is difficult to precisely identify which lines are less likely to be crossed and the main reasons for this. It probably has a lot to do with the background of the judges and arbitrators as well as the type of problems with which they deal.

With respect to international investment disputes, the main precedents relied on by NGOs are three WTO cases decided by the DSB between 1998 and 2001,3 which run afoul of the restrictive amicus practice of the International Court of Justice (ICJ).

The first decision in the sequence is the report of the WTO Appellate Body in the U.S.-Sbrimp case.4 The Appellate Body report corrected the WTO panel's interpretation of Article 13 of the Dispute Settlement Understanding (DSU), which deals with the panel's right to seek information.5 The report stated, in relevant part:

A panel has the discretionary authority either to accept and consider or to reject information and advice submitted to it, whether requested by a panel or not.... The amplitude of the authority vested in panels to shape the processes of fact-finding and legal interpretation makes clear that a panel will not be deluged, as it were, with non-requested material, unless that panel allows itself to be so deluged. …