Here and there, speakers and writers who address the topic of investment-treaty arbitration have attempted to draw a line around what they evidently wish us to see as a new, distinct process, different from other types of arbitration which they often refer to as commercial arbitration. That is a reductionist term. I prefer "traditional arbitration"--or perhaps "pre-1988" arbitration."
What is the nature of this line being proposed to us? The question merits a few moments of reflection. Let us begin with a couple of trivial possibilities. First, this might be a librarian's line, born of a sense of tidiness and a desire to subdivide the unmanageable flood of legal developments in the international community. If that's what it is, why not? It is surely not worth a debate, one way or another.
Alternatively, we might be talking about a territorial line drawn by jealous explorers, who want to declare the discovery of new terra nullius just across their proposed border, thus creating a special zone over which they can exercise dominion--perhaps to stake exclusive claims as founders of a new scholarly sub-discipline. Again, why not? Proclaim your realm, hoist your flag! Soon enough, we shall see if others will salute it.
But, to consider a third possibility, is this an analytical line? This is where I say, hold your horses! Let us not too quickly accept the proposition that investment arbitration by its supposedly unique nature is to be understood as the crucible in which the international community regulates, or fails to regulate, something we are to understand as global public administrative law. I am unconvinced. My quarrel is not with Benedict Kingsbury, who with various colleagues has admirably explored a number of non-traditional international processes by which public action may be tested. What concerns me is the fallacy of the suggestion that this is always the function of investment-treaty arbitration, and never the function of international arbitration as we knew it before 1988. Both of these propositions are false.
Every investment-treaty arbitration does not necessarily implicate important issues of interest to society as a whole. And there were many pre-1988 arbitrations that did.
For those who doubt that last sentence, I need only produce a single Black Swan. I could use Emmanuel Gaillard, but I haven't asked for his permission, so allow me to play the role myself.
My first assignment, fresh out of law school in 1975, was to work on arbitrations arising out of the Libyan nationalizations. Those disputes were decided under arbitration clauses signed by the state. International law was explicitly applicable. My first client, a few years later, was an investor called SPP which sought redress from the government of Egypt for the cancellation of a vast tourism project which, so it was said, was too close to the pyramids and therefore a threat to the cultural heritage of not only Egypt, but all mankind. That dispute was submitted to ICC arbitration in Paris by reference to a contractual clause endorsed by the Minister of Tourism.
For the entire decade of the 1980s, I spent more time on a series of Iranian disputes than on any other matter. This had nothing to do with the Iran-U.S. Claims Tribunal. I acted for the French government. In the early 1970s, the French Nuclear Energy Commission had signed with the Iranian Nuclear Energy Commission an agreement by which Iran would be allowed access as a partner in the giant EURODIF consortium, a multi-billion-dollar uranium enrichment facility. After the fall of the Shah, the Ayatollah Khomeini decreed that the Iranian nuclear industry should be dismantled as a matter of national (indeed, apparently divine) policy. This, said the Iranian Commission, was a case of force majeure. That left France faced with the unacceptable prospect of having to make up the massive Iranian shortfall vis-a-vis its other European partners. …