Investor Presentaiton
114
INVESTOR-STATE DISPUTE SETTLEMENT: A SEQUEL
available to parties. Second, it requires the consensus of all parties
involved and does not give tribunals independent power to decide
on consolidation. Third, it is silent on the specific mechanism by
which consolidation would be achieved.
The second kind of consolidation provision found in IIAS is
modeled on NAFTA Article 1126. These clauses set out a very
detailed consolidation mechanism. Under this type of provision, any
disputing party to the related, ongoing proceedings can request the
consolidation of proceedings. This request triggers a quasi-
automatic process that involves the establishment of a consolidation
tribunal. This tribunal must hear the parties' arguments regarding
the desirability of consolidation, but can decide independently
whether the proceedings should be consolidated. Thus, no consensus
of the parties is required.
However, the tribunal's discretion in this scenario is limited by
two conditions. First, and very importantly, only claims made under
the dispute settlement mechanism of the same treaty can be
consolidated. 120 Second, claims must have "a question of law or fact
in common". Other treaties, such as Article 11(3) of the COMESA
Common Investment Area, provide that claims have to "arise out of
the same events or circumstances".
If these conditions are met, the consolidation tribunal, after
hearing the parties, can assume jurisdiction over all or part of the
claims. If it does so, the original tribunals then lose jurisdiction over
these matters. Some treaties provide for the possibility of referring
the consolidated claims back to one of the original tribunals (e.g.,
Article 33(6) of the Rwanda-United States BIT (2008)).
120 Thus, IIA consolidation provisions do not help resolve the problem of a
foreign company and its shareholders bringing separate claims under
different IIAS.
UNCTAD Series on International Investment Agreements IIView entire presentation