UNCITRAL Working Group II Standards on Transparency in Treaty-Based Investor-State Arbitration : How do they relate to existing IIAs?

Recent investment tribunals have adopted a variety of transparency standards in investor-state arbitral practice. The requirements for openness in investment dispute settlements have included: considering amicus briefs, publishing memoranda, awards, and witness statements and allowing for access to parties' pleadings, transcripts and public hearings either digitally or physically. This practice leads actors to reconsider their positions on transparency as set out in international investment agreements (IIAs), annexes to arbitral rules or memoranda of state. Under pressure to keep further arbitration proceedings open to the public, some actors are now eager to create a new multilateral standard of transparency. The United Nations Commission on International Trade Law (UNCITRAL) Working Group II (WG) has proposed a standard (Standard) which, to some extent, may find consensus within the mandate of the WG and the arbitral community. However, it is uncertain how such a standard will interact with existing IIAs and contractual obligations of host-states and investors. This paper examines the likely effects of applying the proposed Standard in investor-state disputes arising from existing IIAs and investigates how the proposed Standard should be implemented in order to overcome potential obstacles. It argues that a multilateral memorandum of understanding, including commitments from both investors and home-and host-states, is necessary to ensure participation from the maximum number of investors and states

Breaking the Bond: Vulture Funds and Investment Arbitration

The recent decision on jurisdiction and admissibility in Abaclat and others v. Argentina has brought to the public's attention the issue of sovereign defaults and restructuring. Whilst in the Abaclat case, claimants were mostly individual retirees who then assembled to file a class action, a more frightening protagonist is made up of "vulture" funds. These are hedge funds, or other financial vehicles, which purchase sovereign (or corporate) bonds on secondary markets when their prices are extremely low due to the debtor's repudiation or inability to pay back. They then litigate before national courts or international arbitral tribunals in order to recover the entire sums accrued. The analysis in this article begins with an overview of the process of sovereign debt restructuring. We then explore the case of a vulture fund which does not participate in a debt restructuring, and proceeds to enforce an award condemning a State to pay on its bonds, outside of the ICSID framework. Art. V(2) of the New York Convention offers two potential grounds to the State: non-arbitrability and public policy. We examine the interpretations given to the two notions in several cases most relevant to our research. Arguably, the interests involved in debt restructuring proceedings do appear to be sufficient to preclude arbitrability of the subject matter, and thus the enforcement of the award may be prevented. Secondly, the permeability of the public policy exception to economic considerations of fundamental importance - such as those involved in sovereign debt restructuring - finds supporting evidence in a host of jurisdictions. The two grounds might thus be used by States to "break the bond" and prevent non-participating vulture funds from obtaining an unfair advantage over the rest of the creditors.</jats:p

Standards on transparency of publicly listed corporations: Information owed to the public?

The paper is about domestic laws’ response to the greater need of publicly listed corporation to be accountable to the public in accordance with international law. The paper is dedicated to the transparency of multinational corporations listed and incorporated in Germany, the United Kingdom, the United States and Switzerland. Under these applicable laws, transparency of publicly listed corporations has significantly changed in the last decade. Some countries oblige corporations to disclose non-financial and financial information immediately; others merely require periodic reporting of financial information. In particular, the connection between Impact Investor, an investor that invests based on social or environmental criteria in addition to the financial performance, and the investment target, publicly listed corporations contributed to some change. The applicable law provides a minimum standard of transparency. This minimum standard defines how the reasonable investor invests in the publicly listed corporation. Depending on this standard, the responsibility owed by the publicly listed corporation extends from the shareholder, several stakeholders to the public. Reasons for these differences lie in the greater accountability of publicly listed corporations from shareholders, to stakeholders or even the public. The OECD’s different standard on Corporate Governance, the Ruggie principles and other recommendations of non-governmental organisations (NGO) keep shaping the accountability under the applicable law. These standards provide guidance to corporations to voluntarily implement greater responsibilities beyond the minimum standard in the form of Corporate Governance. However, once publicly listed corporations implement these standards, the applicable law seem to not adequately impose duties on publicly listed corporations to disclose the information under its self-imposed standard to stakeholders or even the public. The paper researches the problem of transparency of publicly listed corporations in European Union, in particular Germany and the United Kingdom, as well as the United States and Switzerland wither regard to impact investors. Its hypotheses is that the applicable law lacks clear wording that transfers voluntary standards into binding law. The paper will not focus on obligations of corporation established under contracts with groups of shareholders. It will also not focus on stock market programmes to audit corporations based on environmental and social criteria. The paper excludes inter partes obligations because they give the contracting party merely a right to rely on the disclosure. The paper will also not look at methods for evaluation of non-financial information with regard to publicly listed corporations.</jats:p

Transparency Rules and the Mauritius Convention: A Favourable Haircut of the State’s Sovereignty in Investment Arbitration?

This paper investigates whether the United Nations Commission on International Trade Law (UNCITRAL) Transparency Rules on treaty-based investor-state arbitration (Transparency Rules) increases transparency in investment arbitration fairly for all the participants. The hypothesis is that the Transparency Rules and the United Nations Convention on Transparency in Treaty-based Investor-State Arbitration (Mauritius Convention), work together as a mechanism that is more favourable for the host states than for the investor, and thereby anticipate the different roles of all participants in treaty-based arbitration. Transparency brings pressure for a level playing field among disputing parties. In Detroit International Bridge Company v Government of Canada, UNCITRAL, PCA Case 2012-25, the tribunal accepted the prevalence of the in camera obligation in the procedural rules upon a general treaty obligation, and against the state’s arguments. In Philip Morris Asia Limited v The Commonwealth of Australia, UNCITRAL, PCA Case 2012-12, the tribunal accepted Australia’s need to disclose certain information under their national laws, but to exclude confidential business information as determined by the arbitral tribunal. Other decisions exist in which tribunals decide similarly. This paper explores the actual principle of equality as applied by arbitral tribunals. Thereafter, it considers the legal nature of transparency under the Transparency Rules, standing alone and in combination with the Mauritius Convention. It concludes by determining how this discretion affects the level playing field of all the participants.</jats:p