Investor Presentaiton
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INVESTOR-STATE DISPUTE SETTLEMENT: A SEQUEL
outcome of any given case; it can and it has. 146 The relevance and
role of each source of law is examined in turn.
(i) Investment treaty
147
Some IIAs permit investors only to bring claims that a State has
failed to abide by the substantive protections it promised in the
treaty. Even if the ISDS provision is wider than that and permits,
for example, "any dispute relating to an investment” to be submitted
to arbitration, allegations of violations of IIA obligations typically
form the crux of the investor's claim against the host State. In such
cases, a tribunal is required to assess whether the respondent State's
conduct is consistent with the relevant treaty provisions. Thus, the
treaty itself serves as the primary source of applicable substantive
law.
(ii) Applicable rules and principles of international law
Each investment treaty is part of international law and thus the
application and interpretation of IIAS is further affected by
international law, including general principles of international law
and customary international law. These encompass various issues
such as the attribution of conduct to a State, denial of justice, the
minimum standard of treatment of aliens, circumstances precluding
wrongfulness of State conduct, the calculation of compensation, etc.
Importantly, the customary international rules on treaty
interpretation, codified in the Vienna Convention on the Law of
146 The application of domestic rather than international law was decisive
in Libananco v. Turkey, in which the Turkish property law concept of
"teslim" determined whether the shares have been validly transferred to
Libananco. Under Turkish law, which the tribunal applied, the answer was
no, while under international law the transfer might well have been yes.
See Libananco v. Turkey, ICSID Case No. ARB/06/8, Award, 2 September
2011, paras. 133–173.
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On the scope-of-ISDS clauses, see section II.B.
UNCTAD Series on International Investment Agreements IIView entire presentation