Investor Presentaiton
88
INVESTOR-STATE DISPUTE SETTLEMENT: A SEQUEL
77
same in the two suits." Domestic proceedings often involve a claim
by the investor's local subsidiary, rather than the investor itself,
thereby defeating the identity-of-the-parties requirement. A
variation of this problem is that the domestic claim will be
submitted against a sub-national government unit or other State
entity, rather than the State itself.
Litis pendens also requires identity of the cause of action.
Domestic procedures will usually involve a claim for breach of
contract or domestic law, rather than for breach of an investment
treaty obligation, thereby defeating the requirement that the cause of
action in the two cases be identical. It follows that an international
tribunal will be able to hear the case if the causes of action or the
formal identity of the parties in the arbitration proceedings are not
the same as those of the parties in the domestic courts."
78
Some States have attempted to address this problem by
amending the fork-in-the-road provision. For example, Article 28(3)
of the Common Market for Eastern and Southern Africa (COMESA)
Investment Agreement (2007) provides:
"If the COMESA investor elects to submit a claim at one of
the forums set out in paragraph 1 of this Article, that election
shall be definitive and the investor may not thereafter submit
a claim relating to the same subject matter or underlying
measure to other forums." (Emphasis added).
77
Azurix Corp. v. Argentina, ICSID Case No. ARB/01/12, Decision on
Jurisdiction, 8 December 2003, para. 88, quoting S.A.R.L. Benvenuti &
Bonfant v. Congo, ICSID Case No. ARB/77/2, Award, 8 August 1989,
para. 1.14.
78
For a more detailed explanation of cases holding that the "fork-in-the-
road" provision had not been triggered in various circumstances, see
UNCTAD, 2007a, pp. 30-32.
UNCTAD Series on International Investment Agreements IIView entire presentation