Transcript Investment Arbitration: a perspective of China

MOST FAVORED NATION TREATMENT OF
SUBSTANTIVE RIGHTS
&
INVESTMENT ARBITRATION IN CHINA
Investment Arbitration:
a perspective of China
Prof. Zhao Hong, Ph.D
Minister Counsellor
Permanent Mission of China to WTO
Outline
• Arbitration: a means of dispute settlement
within BITs
• CIETAC arbitration: a comparative view
BITs of China
• General perspectives
• The first case
• Evolution of Investor-state dispute
settlement provision
General features of BITs of China
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Start from 1980s
EU style
Proliferating quickly: over 130
Investor protection, rather than market
accession
• Three generations
early 1980
mid 1990
21 century
The “first” case
• Whether the HK citizen a qualified investor
under BIT between China and Peru
• Issue of consent
• Opposition of jurisdiction
• Future implications
Arbitration provision within BITS
China-Sweden BIT in 1982
• The first BIT of China
• No investor- state dispute settlement provision
• Only state-state dispute settlement
• But there were very few cases like this (e.g.
Thailand)
China BITs in 1990s
• All has investor-state dispute settlement
provision
• only amount of compensation for nationalization
and expropriation cannot be settled through
negotiations within six months, could be
submitted to international arbitration upon the
request of investor
• For all other investor-state disputes, consent is
required before submitting to international
arbitration
China BIT Model text 2003
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ARTICLE 9
SETTLEMENT OF DISPUTES BETWEEN INVESTORS AND
ONE CONTRCTING PARTY
1. Any legal dispute between an investor of one Contracting Party and the other Contracting Party
in connection with an investment in the territory of the other Contracting Party shall, as far as
possible, be settled amicably through negotiations between the parties to the dispute.
2. If the dispute cannot be settled through negotiations within six months from the date it has been
raised by either party to the dispute, it shall be submitted by the choice of the investor:
to the competent court of the Contracting Party that is a party to the dispute;
If the dispute cannot be settled through negotiations within six months from the date it has been
raised by either party to the dispute, provided that the Contracting Party involved in the
dispute may require the investor concerned to go through the domestic administrative
review procedures specified by the laws and regulations of that Contracting Party before
the submission to the ICSID.
Once the investor has submitted the dispute to the competent court of the Contracting Party
concerned or to the ICSID, the choice of one of the two procedures shall be final.
3. The arbitration award shall be based on the law of the Contracting Party to the dispute including
its rules on the conflict of laws, the provisions of this Agreement as well as the universally
accepted principles of international law.
4. The arbitration award shall be final and binding upon both parties to the dispute. Both
Contracting Parties shall commit themselves to the enforcement of the award.
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China BIT model text 2010
ARTICLE 13
SETTLEMENT OF DISPUTES BETWEEN INVESTORS AND
ONE CONTRACTING PARTY
2. If the dispute that an investor of one Contracting Party claiming that the
other Contracting Party has breached an obligation under Article 2 through
9 can not be settled through negotiations within six months from the date it
has been raised by either party to the dispute, the disputing investor who
incurred loss or damage from that breach may, by his choice, submit the
claim:
to the competent court of the Contracting Party that is a party to the dispute;
to International Center for Settlement of Investment Disputes (ICSID) under
the Convention on the Settlement of Disputes between States and Nationals
of Other States, done at Washington on March 18,1965, for arbitration;
to an ad-hoc arbitral tribunal to be established under the Arbitration Rules of
the United Nations Commission on the International Trade Law
(UNCITRAL); or
to any other arbitration institutions or ad-hoc arbitral tribunals agreed by the
disputing parties.
The other Contracting Party may require the investor concerned to
exhaust the domestic administrative review procedures specified by
the laws and regulations of that Contracting Party before the
submission to international arbitration.
Arbitration in CIETAC
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Cases received, No. 1
International arbitrator
Qualified secretary
international consistent Working rules
Mediation ( only when parties agree)
Low cost of fees
Awards enforceable among 144 Members
of NewYork Convention
•Thank you
Prof.Zhao Hong, Ph.D
Minister Counsellor
Permanent Mission of China to WTO
[email protected]