The (in)feasibility of using precedents as a tool to increase consistency in international arbitration
Friday 4 March 2022
Raquel Macedo
ArbLit, Milan
Introduction: Inconsistencies found within the system
On Thursday 19 August 1999, a notice of arbitration was delivered to a historic building in the centre of Prague, addressed to the Czech Republic’s Ministry of Finance. A little more than six months later, another notice would come. Both provided for UNCITRAL arbitration. Both named the government of the Czech Republic as the respondent party. Both advanced damage claims for alleged wrongful treatment — at the hands of the respondent State — of the claimant’s investment in the Czech private television broadcaster TV Nova. Both were based on almost identical bilateral investment treaties signed by the respondent. Yet both reached completely different outcomes.
When Einstein defined insanity as doing the same thing over and over again and expecting different results, he probably did not have in mind international arbitration. In fairness to Einstein, however, these two arbitrations were not exactly the same: they involved different arbitrators.
Arbitrators carry great power and responsibility in shaping an arbitration and its ultimate outcome. Efficiency, attention to details, ability to anticipate the consequences of their own actions in managing the proceedings — all of these skills (among others) are crucial and can set great arbitrators apart.
The arbitrators’ freedom to manage an arbitral proceeding as they deem appropriate has been severely criticized, however, by those who view it as an obstacle to predictability and consistency in international arbitration. Indeed, concerns about consistency, predictability and correctness have been the core of the discussions that led to the UNCITRAL’s remarkable efforts in the field of the reform of the Investor-Stated Dispute Settlement (ISDS) system.[1]
Those issues of lack of consistency can be clearly illustrated upon the consideration of the outcome of the investment disputes mentioned above involving the Czech Republic and the investment made in the Czech private television broadcaster TV Nova.
The TV Nova cases in Czech Republic
When the communist regime ended, the opening of the Czech market – then still Czechoslovakia – entailed the State entering into numerous bilateral investment treaties (BITs) with several countries, including with the United States of America and the Netherlands. The government also enacted the so-called Czech Media Law, which established a Media Council responsible for enforcing the relevant media law and [diversifying?] broadcasting and audio-visual networks domestically and in Europe.
In this context, a licence for television broadcasting was granted to a Czech company named CET 21, which was known to be working closely with a foreign investor, more specifically the Central European Development Corporation (CEDC). CEDC was part of the Bermuda Corporation Group, run by Ronald S. Lauder, a US national. As a result of the parties’ negotiation and a disputed intervention of the Media Council, CEDC’s participation in the business was effected through a Joint Venture named Česká Nezávislá Televizní Společnost (CNTS) that had CEDC, CET 21, and the Czech Savings Bank as shareholders. Since CET21 was the license holder, CNTS and CET21 entered into a Services Agreement, pursuant to which CNTS was to provide broadcasting services through a channel called TV Nova. Eventually, 99 per cent of CNTS’ shares were owned by CME Czech Republic BV (CME), a company incorporated in the Netherlands, also part of the Bermuda Corporation run by Mr. Lauder.
In 1999, however, CET21 terminated the Services Agreement, which meant that CNTS was out of commission since it did not have a license to broadcast on its own. In light of these events, several disputes arose concerning the treatment of foreign investors by the Czech Republic, through the Media Council. One such dispute was brought by Mr. Lauder against the Czech Republic claiming violation of the US-Czech BIT, which began with the notice of arbitration delivered on the mentioned Thursday. A second dispute was brought by CME against the Czech Republic for alleged violations of the Netherlands-Czech BIT, corresponding to the second notice mentioned at the outset of this article.
Although both arbitrations concerned the same dispute and very similar BITs[2], the two arbitral tribunals reached different conclusions.
In the CME case, the arbitrators ruled that the Media Council, acting on behalf of the Czech Republic, was fully responsible for the 'complete collapse of the Claimants and the Claimants predecessor’s investment in the Czech Republic'[3], and that its actions and inactions qualified as expropriation under the treaty.[4] Moreover, the arbitrators in that case have also ruled that the Czech Republic breached its obligation of fair and equitable treatment[5], its obligation not to impair investments by unreasonable or discriminatory measures[6], its obligation to provide full security and protection[7], as well as the obligation to treat investments in conformity with principles of international law.[8] As a result, the arbitrators yielded a damages award of over US260 million dollars in favour of the claimant.
In the Lauder award, however, the tribunal found that the 'Respondent did not take any measure of, or tantamount to, expropriation of the Claimant’s property rights'.[9] The tribunal also found that there was no violation of any specific obligation of international law[10], no breach of the obligation to provide fair and equitable treatment,[11] and no breach of the obligation to provide full protection and security.[12] Finally, while the tribunal did recognize a breach of the Respondent’s obligation not to adopt arbitrary and discriminatory measures against the Claimant[13], such breach was found to be 'too remote to qualify as a relevant cause for the harm caused'.[14] As a result, the tribunal dismissed all of the damage claims raised in the case.[15]
The SGS cases in Pakistan and Philippines
The above-mentioned cases are not the only ones evidencing contradicting decisions. In fact, the same appear to have happened to disputes involving agreements for the inspection and supervision services signed between Société Générale de Surveillance S.A. (SGS), a Swiss company, and States such as Pakistan and the Philippines. Both cases concerned the interpretation of the so-called 'umbrella' clause, also known as the 'observance-of-undertakings' clause. Both cases involved the assessment as to whether such, which was included in both relevant BITs, would elevate all contractual undertakings into international obligations. In other words, the issue was whether the BIT tribunal’s jurisdiction extended to all obligations assumed under any contract signed within the investor-State relationship or was limited to the alleged breaches of BIT obligations per se. The tribunals’ findings were entirely different.
In SGS v Pakistan, the tribunal interpreted article 11 of the BIT signed between Switzerland and Pakistan, which reads 'Either Contracting Party shall constantly guarantee the observance of the commitments it has entered into with respect to the investments of the investors of the other Contracting Party', as not including contractual obligations under the scope of the treaty. As a result, the tribunal ruled that it had jurisdiction only over the claims concerning the alleged BIT breaches, but not over the alleged breach of the Pre-Shipment Investment Agreement signed between the parties.[16]
In SGS v Philippine, however, while interpreting article X(2), which reads 'Each Contracting Party shall observe any obligation it has assumed with regard to specific investments in its territory by investors of the other Contracting Party', the tribunal gave full effect to the umbrella clause included in the BIT signed between Switzerland and the Philippines.[17] The tribunal found that a breach of the Comprehensive Import Supervision Services Agreement (CISS) signed between the parties would amount to a failure to observe binding commitments assumed in the context of a specific investment and, as such, would constitute a breach of the BIT. Accordingly, the tribunal asserted jurisdiction over the claims concerning breaches of both the BIT and the CISS Agreement.[18]
Other contradicting decisions in investment arbitration
The extent of the arbitral tribunal’s jurisdiction under the umbrella clause seems to be a common cause of diverging decisions. Numerous awards favoured extending the umbrella clause to contractual claims, eg, Eureko v. Poland;[19] Noble Ventures v. Romania;[20] Siemens v. Argentina;[21] and CMS v. Argentina[22]; SGS v. Paraguay;[23] Belernegia v. Italy;[24] and Nissan v. India.[25]
At the same time, several other tribunals reached the opposite conclusion and limited the scope of the BIT to breaches of the BIT, eg, Joy Mining v. Egypt;[26] El Paso v. Argentina;[27] Pan American Energy v. Argentina;[28] Salini v. Jordan;[29] Vivendi II;[30] BIVAC v. Paraguay;[31] and KCI v. Gabon.[32]
The questions of the scope of the Most Favoured Nation (MFN) clause and whether it covers dispute settlement provisions also fall prey to divergent interpretations. Most BITs include provisions prohibiting one contracting State from affording investors from the other contracting State treatment that is less favourable than what is accorded to an investor of a third country. The issue is then whether 'treatment' encompasses dispute settlement provisions — such that an investor could choose the most favourable dispute settlement provision among all BITs signed by the respondent State.
Several tribunals have interpreted the MFN clause as granting the investor such a possibility, eg, Maffezini v. Spain;[33] Siemens v. Argentina;[34] Gas Natural v. Argentina;[35] Suez et. al v. Argentina;[36] National Grid PCL v. Argentina;[37] and Vivendi I;[38] and Itisaluna Iraq and others v Iraq[39]. At the same time, other tribunals have refused to apply MFN clauses to dispute settlement provisions, eg, Salini v. Jordan;[40] Plama v. Bulgaria;[41] Telenor v. Hungary;[42] and Lee-Chin v. Dominican Republic.[43]
Contradiction decisions in international commercial arbitration
The issue of conflicting decisions is also no stranger to international commercial arbitration. In the Putrabali case,[44] for example, two completely different awards were rendered in relation to the very same dispute. The case in question concerned a maritime dispute between Putrabali (Indonesian seller) and Rena (French buyer). The relevant arbitration agreement provided for the resolution of the dispute by an arbitral tribunal sitting in London under the auspices of the International General Produce Association. A first award was issued on 10 April 2001 in favour of the French buyer. Putrabali then ‘appealed’ the decision before the English High Court and obtained a partial set-aside of the award.[45] To decide the vacated matter, a second arbitration began, and an award in favour of the Indonesian seller was issued on 19 August 2003. While in court systems, the second award would have replaced the first vacated award, the plurality of the international arbitration system complicated matters. The partial set-aside of the first award did not stop the French buyer from seeking enforcement before the French Courts, or the French Courts from recognizing and enforcing the partially-annulled award.[46] As a result, the existing contradictory arbitral awards created serious problems, especially for the Indonesian party: the French courts denied its appeal of the enforcement decision.
[47]The search for consistency in different jurisdictions
The Oxford Dictionary defines consistency as 'the quality of achieving a level of performance which does not vary greatly in quality over time'.[48] In a legal context, consistency is usually achieved by the use of precedent, which is defined as 'an adjudged case or decision of a court of justice, considered as furnishing an example or authority for an identical or similar case afterwards arising or a similar question of law'.[49]
The reliance on precedents in the decision-making process is of great importance as consistency increases predictability while allowing one to understand the way a law is applied and, therefore, predict with greater certainty the outcome of a dispute.[50] Such legal security is one of the overarching goals of any legal system.
Generally speaking, there are two types of precedent: binding and non-binding precedents.[51] The binding precedents, also referred to as authoritative precedents, are the ones of mandatory application, meaning that a court is bound to apply that specific reasoning and conclusion to any cases under the same circumstances as the ones generating the precedent.[52] The non-binding precedents, on the other hand, also known as persuasive precedents, do not compel a judge to make a decision in same vein, but provide an example of how the matter has already been decided, which may influence and/or provide guidance in the decision-making process of subsequent cases.[53]
Although precedents are considered to have a leading role in common law jurisdictions and a mere supporting role in civil law systems,[54] national legal systems usually reflect a combination of both. Common law systems, for example, are essentially developed with the use of binding precedents under the doctrine of stare decisis,[55] which means literally 'stand by the decision'. At the same time, they also consider decisions rendered outside of their jurisdiction as persuasive precedents, meaning they likely will be examined and considered before a final decision is issued.[56] Such combination also can be seen in civil law systems, which despite being developed according to legal positivist principles, commonly use persuasive precedents under the doctrine of jurisprudence constante.[57] Namely, a long series of previous decisions applying a particular legal principle or rule is commonly considered highly persuasive in civil law systems. In the meantime, the system usually includes certain exceptional circumstances when precedents assume a binding nature.[58]
It has been argued that precedents are of less value if considered only persuasively, but the principle of jurisprudence constante in fact represents the recognition of the evolution of code-based law through interpretation.[59] Put differently, and using the words of Andrea K Bjorklund, the 'absence of stare decisis need not be fatal to the establishment of a coherent and respected body of jurisprudence'.[60]
In contrast to a national legal system’s approach, international law does not apply the idea of binding precedent.[61] The Statute of the International Court of Justice, for instance, in its article 59 provides that:
- 'The decision of the Court has no binding force except between the parties and in respect of that particular case.'[62]
The language of said provision has been consistently read as precluding the application of binding precedents in the context of the International Court of Justice.[63]
Similar wording is found in the NAFTA:
- 'Article 1136: Finality and Enforcement of an Award
1. An award made by a Tribunal shall have no binding force except between the disputing parties and in respect of the particular case.
2. (…)'[64]
Still, persuasive precedents are consistently present in the international context. Reference can be made, for instance, to the article 38 of the Statute of the International Court of Justice conveys the same idea when enlisting subsidiary means for the determination of rules of law:
- 'Article 38
1. The Court, whose function is to decide in accordance with international law such disputes as are submitted to it, shall apply:
a. international conventions, whether general or particular, establishing rules expressly recognized by the contesting states;
b. international custom, as evidence of a general practice accepted as law;
c. the general principles of law recognized by civilized nations;
d. subject to the provisions of Article 59, judicial decisions and the teachings of the most highly qualified publicists of the various nations, as subsidiary means for the determination of rules of law.
2. (…)'.[65]
It is possible, thus, to see that each different legal framework has adopted or developed a different approach in terms of the use of precedents. Similarly, international arbitration also has created (or been affected by) its very own peculiarities concerning the use of precedents, as discussed in the next section.
The use of 'precedents' in international arbitration
The international arbitral framework seems to follow a mixed approach to the use of precedents. Although there is no specific rule applicable on the issue of precedents, different trends have been identified in different categories of arbitral disputes, as pointed out by Gabrielle Kaufmann-Kohler in a paper dedicated to the subject.[66] According to the study, in commercial arbitrations, tribunals are unlikely to ascribe precedential value to other awards, while sport arbitrations reveal a strong reliance on precedents. Investment arbitration comprises a progressive emergence of rules through consideration of prior cases.[67]
To understand such different approaches, it is important to notice that arbitration has been simultaneously expanding in different areas, and that such expansion has evolved differently in each of those areas.[68] In spite of the different trends that have emerged within the investment, commercial, and sports arbitration systems separately, all systems still share common ground features, which analysis may assist in understanding ‘precedents’ are a feasible tool to guarantee consistency in international arbitration.
In this context, two points merit mention: first, there is no express law ascribing a particular value to precedents in international arbitration; and second, the structure of arbitral jurisdiction hardly allows for the creation of such a rule.
As to the first point, it should not come as a surprise that arbitral tribunals are free to examine the case, apply the relevant law, and liberally achieve their own conclusions. Speaking of investment arbitration in particular, article 53 of the ICSID Convention – which establishes that an 'award shall be binding on the parties',' – has been consistently read as 'excluding the applicability of the principle of binding precedent to successive ICSID cases'.[69]
Interestingly enough, although such reading would preclude the application of binding precedents in investment arbitration, arbitrators almost routinely refer to other decisions in their awards,[70] and use other awards as guidance for their own findings.[71] Some speculate that arbitrators follow precedents and thus foster a normative environment that is predictable out of a sense of moral obligation.[72] Another explanation may be the interest of the arbitrators in guaranteeing that the arbitral system remains trustworthy, as well as assuring that the arbitrators themselves are consistent and reliable.[73] Observations aside, there remains a fact that a 'rule to bind them all' simply does not exist either in international commercial arbitration or in investment arbitration.
As to the second issue, one may wonder about the possibility of creating a mandatory rule that grants a specific weight to precedents within an arbitrator’s decision-making process (regardless of such rule establishing a binding or not binding nature for the precedents in question).
In the author’s view it is not possible to create a single rule that obliges arbitrators to consider precedent cases in a specific manner. The main reason for that being the fact that arbitral jurisdiction, unlike national or even international jurisdiction, is not a whole indivisible jurisdiction, but a fractured system.[74] This specific structure of the arbitral system can be perceived in many spheres. A great example is the system’s approach towards parallel proceedings and the application of lis pendens rules.
Imagine a State jurisdiction in which all decision-making processes are subject to the same procedure. Those rules, because applicable to all proceedings of that sort, are able to predict the court’s action in case of a similar pending action and provide for a solution such as a prior tempore rule or even a consolidation of procedures. The same effect can be flagged in an international context whenever dealing with a jurisdiction. Consider, for example, article 29 of the Brussels Ibis Regulation, which establishes rules for solving lis pendens issues throughout the jurisdiction of the entire European Union.[75] In both cases, the existence of an indivisible and permanent jurisdiction guarantees the applicability of the rules to all those who are subject to that specific jurisdiction. They guarantee uniformity.
We cannot say the same for international arbitration. International arbitration is a fragmented jurisdiction.[76] There is no indivisible jurisdiction subject to a specific body of rules. There is no uniform or mandatory approach concerning cases of parallel proceedings.[77] Instead, each arbitral tribunal constitutes a different and new jurisdiction every time new proceedings begin. A newly-formed jurisdiction is bound only by the agreed rules chosen by the parties. It is detached from any other system or jurisdiction or rule that could automatically apply and bind the tribunal to act in a certain uniform manner.
In practice, tribunals may rely on the rule of res judicata, provided of course that the same parties, facts and legal basis are concerned, but that is a general principle of law,[78] not a binding rule. Similarly, tribunals also may feel compelled to stay proceedings due to an existing parallel proceeding based on general principles of law,[79] but they are not bound to do so.
That said, because the arbitral jurisdiction is fractured while composed of a number of mini systems, a common rule regarding the weight of precedent in international arbitration cannot be imposed to each and every tribunal at once.[80]
Available alternatives
There are, however, options available when it comes to initiatives that could help increase predictability in international investment as well as commercial arbitration.
First, arbitral institutions could include precedent value rules within their procedural rules, guaranteeing thus that any arbitration (and thus arbitral jurisdiction) constituted under those specific rules is bound by previous understandings of tribunals formed under those same procedures. To make an example, one could imagine that the ICC would add a provision to its Arbitration Rules determining that arbitral tribunals constituted under the ICC Rules would be bound by certain principles, standards, or even jurisprudence in accordance with previous awards rendered also under the ICC Rules.
This author does not deny that for such type of solution to work, many aspects would have to be sorted out, such as guaranteeing that the awards would be published in timely fashion and establishing standards or rules in accordance with which a decisional trend would prevail over others. Not to mention that a great discussion could also be held regarding the legitimacy of an institution to make that type of decision and have such a determinative role in the field of international arbitration.
Without entering the specifics of how such option might unveil in practice, which alone could be the subject of an entire research project, the point being made here relates to the consideration that having arbitral institutions establish a solid basis of principles, standards or jurisprudence might even potentially work as an attractive key element for arbitral institutions as parties entering into an arbitration agreement would certainly take into account the jurisprudence constante of that particular institution before making the choice for procedural rules. If, on the one hand, the approach would allow for a common rule to bind several different arbitral jurisdictions, at the same time, it would also come with limitations.
A first limitation, common to both commercial as well as investment arbitrations, would be circumscribing the principles, standards or jurisprudence that were to become binding. As seen above, the current system already includes contradictory decisions, which would trigger the need for the arbitral institutions to decide which course of actions to adopt to the detriment of its contradicting decision.
A second limitation would be the burden that such rule would impose on arbitral institutions in terms of guaranteeing that the precedential value rule is applied correctly in concrete cases. Said burden would be further compounded by the need to establish avenues and processes for remedying the situation whenever an arbitral tribunal fails to follow the relevant principles, standards, or jurisprudence.
Finally, a third limitation – which would particularly hit the investment arbitration framework – is the difficulty encountered in amending the procedural aspects of the existing rules. Although the ICC Rules for Arbitration are constantly updated according to the newest trends in international arbitration, any changes to the ICSID rules, for example, require the agreement of all signatory parties to the ICSID Convention, which is certainly far from being an easy task.
Another interesting option for increasing predictability in international arbitration, and which is in fact already being put into place by some arbitral institutions, is a consistent exercise of transparency followed by the publications of their arbitral awards – sometimes without the name of the involved parties in order to guarantee confidentiality to the proceeding – to serve as example and guidance in arbitral cases. Such initiative has been taken, for example, by the ICC, which published Collection of ICC awards[81] as well as by the International Centre for Settlement of Investment Disputes (ICSID), which made available a wide-ranging case law database easily accessible on the ICSID online platform.[82] Equally rich databases can also be found at the Permanent Court of Arbitration website[83] or Italaw.[84]
Further initiatives to increase predictability and consistency in international arbitration are also being put into place by international organizations, which are playing an important role in better describing international investment law and in providing guidance, even though only in the form of soft law, to arbitrators in their task of adjudicating a case. In this context, the OECD conducted very interesting studies regarding the interpretation of general concepts, such as MFN and Umbrella clauses, investor and investment.[85] Due recognition should be given also to the ILA reports on the Role of Soft Law Instruments in International Investment Law, as well as to the Issues Notes on International Investment Agreements published by UNCTAD.
Conclusion
Despite all of the help available, the task of deciding matters uniformly in international arbitration remains a challenge. Although interpretative trends have emerged in the past years, there is still much to be discussed and even more to be consolidated. Thomas Wälde could not be more correct when pointing out that:
- 'Arbitral jurisprudence can be compared to a competitive market: various solutions to arising interpretative challenges compete for attention and acceptance; there is experimentation going on. The most persuasive solutions will generate a momentum that leads to ‘jurisprudence constante’.' In conclusion, the use of precedent in international arbitration has grown in the past years and a jurisprudence constante is in the process of being formed. Still, there are limitations to the reliance on a rule of precedent as a solution for issues of consistency and predictability in international arbitration since there is no room for such rule to be imposed. Alternative solutions include changes in procedural rules and a constant push to transparency and objectivity. The key element, however, seems to be time. And until time is given for a jurisprudence constante to be consolidated, precedents will still comprise contradicting decisions which arbitrators can freely choose whether or not to follow in their decision-making process.
[2]Although the treaties are not identical, they both include similar obligations that were at issue in both cases, namely (i) the obligation to provide fair and equitable treatment (art. II(2)(a) of the U.S.-Czech BIT and art. 3(1) of the Netherlands-Czech BIT); (ii) full security and protection guarantees (art. II(2)(a) of the U.S.-Czech BIT and art. 3(2) of the Netherlands-Czech BIT); and (iii) the application of rules and principles of international law (art. II(2)(a) of the U.S.-Czech BIT and art. 3(5) of the Netherlands-Czech BIT).
[3]CME Czech Republic B.V. (The Netherlands) v. Czech Republic, Partial Award, 13 September 2001, §427.
[9]Ronald S. Lauder v. The Czech Republic, Final Award, 3 September 2001, §201. Subsidiarily, the tribunal has also added that 'even assuming that the actions taken by the Media Council in the period from 1996 trough 1999 had the effect of depriving the Claimant of his property rights, such actions would not amount to an appropriation - or the equivalent - by the State, since it did not benefit the Czech Republic or any person or entity related thereto, and was not taken for any public purpose' (§203).
[15]Ronald S. Lauder v. The Czech Republic, Final Award, 3 September 2001, §§313-314.
[16]SGS Société Générale de Surveillance S.A. v. Islamic Republic of Pakistan, Decision on Objection to Jurisdcition, 6 August 2003.
[17]SGS Société Générale de Surveillance S.A. v. Republic of the Philippines, Decision on Objection to Jurisdcition, 29 January 2004.
[18]In said case, the CISS Agreement contained an exclusive jurisdiction clause according to which “All actions concerning disputes in connection with the obligations of either party to this Agreement shall be filed at the Regional Trial Courts of Makati or Manila.”. On that basis, the tribunal decided that it should not exercise its jurisdiction over the contractual claims when the parties had already agreed on how such a claim were to be resolved, and had done so exclusively (§155). As a result, the tribunal ruled that “until the question of the scope or extent of the Respondent’s obligation to pay is clarified—whether by agreement between the parties or by proceedings in the Philippine courts as provided for in Article 12 of the CISS Agreement—a decision by this Tribunal on SGS’s claim to payment would be premature.” (§155). The author, however, notes and points out the difference between the tribunal’s interpretation giving full effect to the umbrella clause (§135 of the award) and the tribunal’s eventual decisions not to consider the contractual claim due to the fact that the matter was already pending before the Philippines courts (§155).
[19]Eureko B.V. v. Poland, Partial Award, 19 August 2005, §§ 244-260.
[20]Noble Ventures Inc. v. Romania, Award, 12 October 2005, §§ 42-62.
[21]Siemens A.G. v. The Argentine Republic, Award, 17 January 2007, § 206.
[22]CMS Gas Transmission Company v. The Argentine Republic, Award, 12 May 2005, §§ 296-303.
[23]SGS Société Générale de Surveillance S.A v. Republic of Paraguay, ICSID Case No. ARB/07/29, Decision on Jurisdiction, 12 February 2012, § 170.
[24]Belenergia S.A. v. Italian Republic, ICSID Case No. ARB/15/40, Award, 6 August 2019, § 359.
[25]Nissan Motor Co., Ltd. v. Republic of India, PCA Case No. 2017-37, Decision on Jurisdiction, 29 April 2019, § 284.
[26]Joy Mining Machinery Limited v. Arab Republic of Egypt, Award on Jurisdiction, 6 August 2004, § 81.
[27]El Paso Energy International Company v. The Argentine Republic, Decision on Jurisdiction, 27 April 2006, §§ 66-86.
[28]Pan American Energy LLC and BP Argentina Exploration Company v. The Argentine Republic, Decision on Preliminary Objections, 27 July 2006, §§ 92-115.
[29]Salini Costruttori S.p.A. and Italstrade S.p.A. v. The Hashemite Kingdom of Jordan, Decision on Jurisdiction, 9 November 2004, §§ 120-130.
[30]Compañia de Aguas del Aconquija, S.A. and Vivendi Universal S.A. v. The Argentine Republic, Decision on Annulment of 3 July 2002, § 96.
[31]Bureau Veritas, Inspection, Valuation, Assessment and Control, BIVAC B.V. v. The Republic of Paraguay, ICSID Case No. ARB/07/9, Decision of the Tribunal on Objections to Jurisdiction, 29 May 2009, § 142.
[32]Kontinental Conseil Ingénierie v. Gabonese Republic, PCA Case No. 2015-25, Sentence Finale, 23 December 2016, § 180.
[33]Emilio Agustin Maffezini v. The Kingdom of Spain, Decision on Jurisdiction, 25 January 2000, §§38-64.
[34]Siemens A.G. v. The Argentine Republic, Decision on Jurisdiction, 3 August 2004, §§ 32-110.
[35]Gas Natural SDG v. The Argentine Republic, Decision on Preliminary Questions of Jurisdiction, 17 June 2005, §§. 24-31, 41-49.
[36]Suez, Sociedad General de Aguas de Barcelona S.A., and InterAguas Servicios Integrales del Agua S.A. v. The Argentine Republic, Decision on Jurisdiction, 16 May 2006, §§ 52-66.
[37]National Grid PCL v. The Argentine Republic, Decision on Jurisdiction, 20 June 2006, §§ 53-94.
[38]Suez, Sociedad General de Aguas de Barcelona, S.A. and Vivendi Universal, S.A. v. Argentine Republic, Decision on Jurisdiction, 3 August 2006, §§ 52-68.
[39]Itisaluna Iraq LLC, Munir Sukhtian International Investment LLC, VTEL Holdings Ltd., VTEL Middle East and Africa Limited v. Republic of Iraq, ICSID Case No. ARB/17/10, Award, 3 April 2020, § 195.
[40]Salini Costruttori S.p.A. and Italstrade S.p.A. v. The Hashemite Kingdom of Jordan, Decision on Jurisdiction, 9 November 2004, § 119.
[41]Plama Consortium Limited v. Republic of Bulgaria, Decision on Jurisdiction, 8 February 2005, §§ 183-184, 223, 227.
[42]Telenor Mobile Communications AS v. The Republic of Hungary, Award, 13 September 2006, §§ 90-100.
[43]Michael Anthony Lee-Chin v. Dominican Republic, ICSID Case No. UNCT/18/3, Dissenting Opinion of Professor Marcelo Kohen, § 101.
[44]Philippe Pinsolle, 'The Status of Vacated Awards in France: the Cour de Cassation Decision in Putrabali', in William W. Park (ed), Arbitration International, (© The Author(s); Oxford University Press 2008, Volume 24 Issue 2) pp. 277 – 295.
[45]P.T. PUTRABALI ADYAMULIA v. SOCIÉTÉ EST EPICES SAME v. ENRICO WEBB JAMES SNC (THE “INTAN 6 V.360A SN”) [2003] 2 Lloyd's Rep. 700.
[46]Société PT Putrabali Adyamulia v. Société Rena Holding et Société Moguntia Est Epices, Court of Appeal of Paris, France, 31 March 2005. The author notes that France is what one could call an outlier jurisdiction, meaning that most of other national courts would have not enforced annulled awards. However, because France remains a worldwide reference for international arbitration, the French approach towards arbitration gains great proportions and remain extremely relevant in the worldwide scenario.
[47]Société PT Putrabali Adyamulia v. Rena Holding Société Moguntia Est Epices, Court of Cassation, France, 05-18053, 29 June 2007.
[48]Oxford English Dictionary Online. Oxford University Press, 2016. Consulted on 23 September 2021.
[49]Black’s Law Dictionary Free Legal Online Legal Dictionary, 2nd edition, 1910. Available at http://thelawdictionary.org/precedent/#ixzz4XEfILyGP, consulted on 23 September 2021.
[50]Lon Fuller, The Morality of Law, revised edition, Yale Press University, 1969, pp. 33–41.
[51]Gabrielle Kaufmann-Kohler, Arbitral Precedent: Dream, Necessity or Excuse?: The 2006 Freshfields Lecture, Arbitration International LCIA, Vol. 23, No. 3, 2007, p. 357-378, p.p. 358.
[52]Black’s Law Dictionary, 7th edition, 1999, p. 1195, defines precedent as ‘[a] decided case that furnishes a basis for determining later cases involving similar facts or issues; [s]ee stare decisis’. In the same sense, the United States Department of Justice in its Legal Terms Glossary, issued on November 13, 2014, defines “binding precedent” as a “prior decision by a court that must be followed without a compelling reason or significantly different facts or issues.”
[53]Black’s Law Dictionary, 7th edition, 1999, p. 1215, defining a persuasive precedent as a decision that is not binding but is entitled to respect and careful consideration.
[54]James L. Dennis, Interpretation and Application of the Civil Code and the Evaluation of Judicial Precedent, Louisiana Law Review, Vol. 54, No.1, 1993, p.3.
[55]In the U.S. system, “Federal district courts are bounds by decisions of the Appeal Courts of its circuit, and by decisions of the U.S. Supreme Court.” Andrea K. Bjorklund, Investment Treaty Arbitral Decisions as Jurisprudence Constante in Colin Picker, Isabella Bunn & Douglas Arner, International Economic Law: The State and Future of the Discipline, Hart Publishing, 2008, p.271. Similarly, in the United Kingdom, the stare decisis principle is seen as “the sheet-anchor of our jurisprudence” upon which “the whole elaborate structure of our case law has been built up.” Jeffery P. Commission, Precedent in Investment Treaty Arbitration, A Citation Analysis of a Developing Jurisprudence in Journal of International Arbitration, Vol. 24, No.2, 2007, p. 129–158, p.p. 133-134.
[56]Court decisions from other U.S. federal district courts are merely advisory, just as decisions from federal courts of appeal outside the appellate circuit in which the district court sits. Andrea K. Bjorklund, Investment Treaty Arbitral Decisions as Jurisprudence Constante in Colin Picker, Isabella Bunn & Douglas Arner, International Economic Law: The State and Future of the Discipline, Hart Publishing, 2008, p. 271.
[57]The concept comes from the French civil law tradition, according to which the starting point of the case analysis is the language used in the applicable statutory code, while judicial decisions have a complementary influence on other courts as examples of accepted interpretation of that statute. Mary Garvey Algero, The Sources of Law and the Value of Precedent: A Comparative and Empirical Study of a Civil Law State in a Common Law Nation, Louisiana Law Review, Vol. 65, No.2, 2005, p. 775-822, p.p. 788-789.
[58]In France, for example, while decisions of a lower or equal court can serve as a positive (or negative) model for the case under consideration, decisions from the higher courts are typically followed by lower courts, as a practical matter. Still, when the Cour de Cassation rules in plenary session, that decision expressly will guide future decisions while binding the court of appeal (even if only for that case and not for future similar ones). Michael Troper and Christophe Grzegorczyk, Precedent in France in D. Neil MacCormick and Robert S. Summers, Interpreting Precedents Ashgates, 1997.
[59]Andrea K Bjorklund, Investment Treaty Arbitral Decisions as Jurisprudence Constante in Colin Picker, Isabella Bunn & Douglas Arner, International Economic Law: The State and Future of the Discipline, Hart Publishing, 2008.
[61]In this sense, consider Lord Denning’s famous assertion in the case Trendex Trading Corporation v. Central Bank of Nigeria, English Court of Appeal, 1977, in which he states that “international law knows no rule of stare decisis.” In the same sense, A response to the criticism against ISDS, European Federation for Investment Law and Arbitration (EFILA), 2005, p.12.
[62]Statute of the International Court of Justice, art. 59.
[63]Jose E. Alvarez, The New Dispute Settlers: (Half) Truths and Consequences, Texas International Law Journal, Vol. 38, No. 3, 2003, p. 405-444, p.p. 406-407. Royal C. Gardner, Taking the Principle of Just Compensation Abroad: Private Property Rights, National Sovereignty, and the Cost of Environmental Protection, University of Cincinnati Law Review, Vol. 65, 1997, p. 539-593, p.p. 574.
[64]North America Free Trade Agreement (NAFTA), art. 1136(1). Andrea K. Bjorklund, Investment Treaty Arbitral Decisions as Jurisprudence Constante in Colin Picker, Isabella Bunn & Douglas Arner, International Economic Law: The State and Future of the Discipline, Hart Publishing, 2008.
[65]Statute of the International Court of Justice, art. 38: 'The Court, whose function is to decide in accordance with international law such disputes as are submitted to it, shall apply: (…) d. subject to the provisions of art. 59, judicial decisions and the teachings of the most highly qualified publicists of the various nations, as subsidiary means for the determination of rules of law.'
[66]Gabrielle Kaufmann-Kohler, Arbitral Precedent: Dream, Necessity or Excuse?: The 2006 Freshfields Lecture, Arbitration International LCIA, Vol. 23, No. 3, 2007, pp. 357-378, p. 361.
[69]Christoph H Schreuer, The ICSID Convention: A Commentary, Cambridge University Press, 2001, p. 1082.
[70]Jeffery P. Commission, Precedent in Investment Treaty Arbitration, A Citation Analysis of a Developing Jurisprudence in Journal of International Arbitration, Vol. 24, No.2, 2007, p. 129–158, p.p. 149. See also. Stefan Pislevik, Precedent and development of law: Is it time for greater transparency in International Commercial Arbitration?, in William W Park (ed), Arbitration International, Oxford University Press 2018, Volume 34 Issue 2, pp. 241 – 260, p. 250.
[71]August Reinisch, The Role of Precedent in ICSID Arbitration, Austrian Arbitration Yearbook, 2008, p.495-510, p.p. 513.
[72]Gabrielle Kaufmann-Kohler, Arbitral Precedent: Dream, Necessity or Excuse?: The 2006 Freshfields Lecture, Arbitration International LCIA, Vol. 23, No. 3, 2007, p. 357-378, p.p. Gabrielle Kaufmann-Kohler, 2007.
[72]'ICSID arbitral tribunals are established ad hoc, … and the present Tribunal knows of no provision, … establishing an obligation of stare decisis. It is nonetheless a reasonable assumption that international arbitral tribunals, notably those established within the ICSID system, will generally take account of the precedents established by other arbitration organs, especially those set by other international tribunals.' El Paso Energy International Company v The Argentine Republic, Decision on Jurisdiction, 27 April 2006, § 39.
[74]Andrea K. Bjorklund, Investment Treaty Arbitral Decisions as Jurisprudence Constante in Colin Picker, Isabella Bunn & Douglas Arner, International Economic Law: The State and Future of the Discipline, Hart Publishing, 2008, p. 270.
[75]Regulation (EU) No 1215/2012 of the European Parliament and of the Council of 12 December 2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters, Article 29.
[76]'Investment treaty arbitration is even more inherently fragmented as a forum for dispute resolution' while being a 'product of sources of the rights being found in various separate bilateral treaties, and the concurrence of national law and international remedies relating to the same state measure'. Campbell McLachlan, Lis Pendes in International Litigation, Hague Academy of International Law, 2009. p.294.
[77]Campbell McLachlan, 2009, p.192. Philippe Schweizer and Olivier Guillod, L’exception de litispendence et l’arbitrage international, in F Knoepfler, Le juriste Suisse face au droit et aux jugements étrangers : ouverture ou repli?, 1998, p.71. Bernardo M. Cremades and Julian D.M. Lew, Parallel State and Arbitral Procedures in International Arbitration, ICC Publishing, 2005, p.311.
[78]AMCO v Republic of Indonesia, Resubmitted Case Decision on Jurisdiction, 10 May 1988, § 26.
[79]Islamic Republic of Iran v United States of America, Partial Award, 17 July 2009, § 114., 10 May 1988, § 26.
[80]Campbell McLachlan, Lis Pendes in International Litigation, Hague Academy of International Law, 2009, p. 298.
[81]A six-volume collection of awards dating from 1976 to 2011 compiled in order to provide a tool of highly accessible information for arbitrators and practitioners.
[82]Available at https://icsid.worldbank.org/en/Pages/cases/searchcases.aspx
[85]OECD chapters on International Investment Law: Understanding Concepts and Tracking Innovations, 2008.
[86]Reports from the International Law Association Study Group Work, from 2008 to 2014., 2008.
[87]The United Nations Conference on Trade and Development IIA Issues Notes, published twice a year aiming to offer policy-oriented discussion on the matter concerning latest developments and identified issues on the system.
[88]Thomas W Wälde, The Present State of Research, in New Aspects of International Investment Law, 2004.