REVISITING THE CONCEPT OF JUSTICE IN INTERNATIONAL INVESTMENT ARBITRATION: A WAKE-UP CALL TO SAVE A DYING SYSTEM
DOI:
https://doi.org/10.53704/fulaj.v1i2.538Abstract
Against the backdrop of the rising popularity of arbitration in settling international commercial disputes and increasing access to justice, generally, and the relevance of Investor-state dispute settlement (ISDS) and International investment arbitration (IIA), as subsets of international commercial arbitration, particularly, as well as the growing concerns about ISDS and IIA and the agitation for the reform of these twin-subsets of international commercial arbitration, this paper assesses the imperative of IIA tribunals giving human rights norms prime consideration in ISDS cases, as one of the multiple reform-strategies for ISDS and IIA, which should yield to continuing attraction of both ISDS and IIA, as major components of international commercial arbitration. The paper finds that IIA tribunals giving human rights norms adequate consideration in ISDS cases is, indeed, inevitable, as a strategy for the continuing attraction of both ISDS and IIA in international commercial dispute settlement and it makes valuable contributions in that regard.
Keywords: Arbitration, ISDS, IIA, Justice, Human Rights
References
Sergio Puig and Anton Strezhnev, ‘The David Effect and ISDS’ (2017) 28(3) EJIL321.
Doug Jones, ‘Investor-State Arbitration in Times of Crisis’ (2013) 25 Nat’l L Sch Indian Rev 27, 57-58; see IIED, CCSI and IISD, ‘Shaping the Reform Agenda: Concerns Identified and Cross-Cutting Issues’ (15 July 2019) para 1.
See IIED, CCSI and IISD, ‘Shaping the Reform Agenda: Concerns Identified and Cross-Cutting Issues’ (15 July 2019) para 1.
International Justice Resource Centre, ‘Mandates of the Working Group on the Issue of Human Rights and Transnational Corporations and Other Businesses’ (7 March 2019) 4 <https://ijrcenter.org/un-special-procedures/working-group-on-the-issue-of-human-rights-and-transnational-corporations-and-other-business-enterprises/> accessed 13 March 2023: see also Chevron v Ecuador, PCA Case No 2007-02/AA277, an arbitration matter that brings to the fore the human rights abuses associated with foreign investments and the injustice ISDS tribunal may dispense if they sacrifice human rights norms for investor rights.
See Marc Bungenberg and August Reinisch, From Bilateral Arbitral Tribunals and Investment Courts to a Multilateral Court: Options Regarding the Institutionalization of Investor-State Dispute Settlement (European Yearbook of International Economic Law, Springer Open, Berlin 2020) 117.
To accommodate the views of some member states who are not comfortable with the idea of a MIC, UNCITRAL no longer uses the term ‘MIC’ but a ‘standing multilateral mechanism’ (See, for example, UNCITRAL, ‘Draft Code of Conduct for Judges in International Investment Dispute Resolution and Commentary: Note by the Secretariat, A/CN.0/1149 (UNCITRAL 56th Session, Vienna, 3-21 July 2023) para C.1.
Douglas M. Johnston, ‘The New Equity in the Law of the Sea’ (1975/1976) 31(1) Int’l J 79.
See Anastasios Gourgourinis, ‘Equity in International Law Revisited (with Special Reference to the Fragmentation of International Law)’ (2009) 103 American Society of Intl L 79, 82.
Walt Wilhelm and others v Bundeskartellamt, Case 14-68 (13 February 1969).
Michael Akehurst, ‘Equity and General Principles of Law’ (1976) 25(4) ICLQ 804.
Wilhelm v Bundeskartellamt (n 10) reported in EUR-Lex Case Summary, para 2 <https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A61968CJ0014> accessed 20 July 2021.
Alexander J. Belohlavek, ‘Arbitration and Basic Rights: Movement from Contractual Theory to Jurisdictional Theory’ (17 October 2013) 47 <https://ssrn.com/abstract=2344701> accessed 31 July 2021.
Hong-lin Yu, ‘A Theoretical Overview of the Foundations of International Commercial Arbitration’ (2008) 1(2) Contemp Asia Arb J 255, 257.
See Aikaterini Titi, The Right to Regulate in International Investment Law, in Vol. 10 Studies in International Investment Law (Hart 2014) 29, where the author correctly asserts that aspects of both public international law and private commercial arbitration underly IIA.
Process and Industrial Developments v Ministry of Petroleum of the Federal Republic of Nigeria (P&ID v Nigeria), Case 1:18-cv-00594, ad hoc international arbitration.
The relevant municipal laws are the Arbitration and Mediation Act 2023 (AMA), and the NIPC Act (n 146).
The relevant rules are the Arbitration Rules, First Schedule to the AMA.
Antony D’Amato, ‘On the Connection between Law and Justice’ (2011) Faculty Working Papers, vol 2, 4 <https://scholarlycommons.law.northwestern.edu/cgi/viewcontent.cgi?article=1001&context=facultyworkingpaper> accessed 30 October 2019.
Olusesan Oliyide, ‘The Intersection between Christian Faith and Justice’ in Dorcas A. Odunaike and Olubukola Olugasa (eds), Biblical Foundation of Law and Diplomacy (Princeton & Associates 2020) 198 citing Dahiru Mustapher, The Nigerian Judiciary: Towards the Reform of the Bastion of Constitutional Democracy (NIALS, 2011) 1.
Gerhart Husserl, ‘Justice’ (1937) 47(3) Intl J of Ethics 271.
Julian Cardenas Garcia, ‘The Era of Petroleum Arbitration Mega Cases’ (2013) 35 Hous J Intl L 537, 538-39.
Vienna Convention on the Law of Treaties (VCLT) 23 May 1969, 1155 U.N.T.S. 331.
Pieter Pekelharing, ‘Global Justice and the State’ in Monique Kremer, Peter van Lieshout, Robert Went (eds) Doing Good or Doing Better: Development Policies in a Globalising World (Amsterdam University Press. 2009) 341.
Alec Stone Sweet, ‘Investor-State Arbitration: Proportionality’s New Frontier’ (2020) L and Ethics of Human Rights 3.
See Adiyat Goyal, ‘Fixing the Broken Legs of Investor-State Arbitration’ (2016) 1 HNLU Student Bar J 17, 18.
Oliyide (n 24) 202 citing JAK Thompson (trans), Aristotle: The Nicomachean Ethics (Penguin Classics 1955) cited in JD Ogundare, The Nigerian Judge and His Court (University Press 1994) 103.
PK Nwokedi, ‘Enforcement of Court Orders and Stability of Government and Society’ in 1992 Judicial Lectures: Continuing Education for the Judiciary (MIJ Professional Publications 1992) 109.
U.S. 408 (2003); see also Tsokwa Motors (Nig.) Ltd v U. A. A Plc. (2008) 2 N W L R (Pt 1071) 347, 350, paras B-C.
Yukos Universal Limited (Isle of Man) v. Russian Federation, PCA Case No. AA 227, Final Award (18 July 2014) para 670.
Marion Jansen, Joost Pauwelyn and Theresa Carpenter, ‘Trade and Investment Disputes: The Role of Economists’ (31 January 2018) <https://voxeu.org/article/trade-and-investment-disputes-role-economists> accessed 5 August 2021.
Stephen Waddams, 'The Price of Excessive Damage Awards' (2005) 27 Sydney L Rev 543, 546-7.
Noah Lewin, ‘A Theory of Justice (John Rawls)’ accessed 30 November 2023.
See John Rawls, A Theory of Justice (Revised edn, The Belknap Press of Harvard University Press 1999) 3.
Lewin (n 45).
See Charles E. Rice, ‘The Problem of Unjust Laws’ (1981) 26 Catholic L 280.
Pekelharing (n 32).
Oliyide (n 24) 98, 202 citing JAK Thompson (trans), Aristotle: The Nicomachean Ethics (Penguin Classics 1955) cited in JD Ogundare, The Nigerian Judge and His Court (University Press 1994) 103.
Vienna Convention on the Law of Treaties (VCLT) 23 May 1969, 1155 U.N.T.S. 331.
Robert Stephen Higgins, ‘The Theory of Human Rights’ (2019) accessed 30 November 2022
Rohini College of Engineering & Technology, ‘Theories of Human Rights’ <https://rcet.org.in/uploads/academics/rohini_29785608991.pdf> accessed 1 December 2023.
Council of Europe, ‘What are Human Rights?’ accessed 1 December 2022
LegalRaj, ‘Theories of Human Rights’ <https://legalraj.com/articles-details/theories-of-human-rights> accessed 1 December 2022
Andrew Head, ‘Human Rights: Chimerasi in Sheep's Clothing?’ (1997) accessed 1 December 2022.
Nsongurua Udombana, ‘Between Promise and Performance: Revisiting States' Obligations under the African Human Rights Charter’ (2004) 40 Stan J of Intl L 105, 140; see also United Nations Development Programme (UNDP) Millennium Project, Investing in Development: A Practical Plan to Achieve the Millennium Development Goals (2005) 31.
See International Covenant on Civil and Political Rights 1966 (ICCPR) and International Covenant on Economic, Social and Cultural Rights 1966 (ICESCR).
Universal Declaration of Human Rights, art 25.
UN Doc. 993 UNTS 3 (adopted 16 December 1966 and entered into force 26 March 1976)
ICESCR, art 11.
African Charter, OAU Doc. CAB/LEG/67/3 (1982).
ICCPR, art 1, and ICESCR, art 1.
Demelash Shiferaw and Yonas Tesfa, ‘Theories of Human Rights and Justification’ <https://www.abyssinialaw.com/study-on-line/385-human-right-law/7371-theories-of-human-rights-and-justification.> accessed 1 December 2022.
SERAC case, African Commission Communication 155/96 (2001).
Mapuche Paynemil and Kaxipayiñ Communities case, IACHR Case No. 12.010.
Carla Clarke, ‘Litigating the Right to Health for Indigenous Peoples’ in State of the World’s Minorities and Indigenous Peoples (2013) 53 <https://minorityrights.org/wp-content/uploads/old-site-downloads/download-1276-Litigating-the-right-to-health-for-indigenous-peoples.pdf > accessed 23 April 2023.
ESCR-Net, ‘Mapuche Paynemil and Kaxipayiñ Communities, Case No. 12.010. [ENG]’ accessed 23 April 2023.
Scheagbe Mayumi Grigsby, ‘Enforcing Economic, Social and Cultural Rights: A Stark Dichotomy’ (3 May 2017) NE. U. L. R. EXTRA LEGAL 2-3.
Ayebaesin Jacob Beredugo and Frans Viljoen, ‘Towards a Greater Role and Enhanced Effectiveness of National Human Rights Commissions in Advancing the Domestic Implementation of Socioeconomic Rights: Nigeria, South Africa and Uganda as Case Studies’ (2014) 403 <https://repository.up.ac.za/bitstream/handle/2263/52709/Beredugo_Towards_2015.pdf?sequence=1&isAllowed=y> accessed 17 March 2023.
The UN Guiding Principles were annexed to the Special Representative’s Final Report to the Human Rights Council (A/HRC/17/31). The HRC unanimously endorsed it in 2011.
UN Guiding Principles, para 4.
Proposed UN Binding Treaty on TNCs, pmbl.
Ibid.
See Hilary Charlesworth, ‘A Regulatory Perspective on the International Human Rights System’ in Peter Drahos (ed), Regulatory Theory (ANU Press, 2017) 357.
This provision is apt as it covers all business activities, including local investments that violate human rights.
Proposed UN Binding Treaty on TNCs, art 1.2.
See also Draft United Nations Code of Conduct on Transnational Corporations [1983 version], art 1(4), which provides that the provisions of the Code ‘are not intended to introduce differences of conduct between transnational corporations and domestic enterprises. Wherever the provisions are relevant to both, transnational corporations and domestic enterprises should be subject to the same expectations in regard to their conduct.’
Cf. ILO Tripartite Declaration para 11, which provides that ‘[t]he principles laid down in this Declaration do not aim at introducing or maintaining inequalities of treatment between multinational and national enterprises. They reflect good practice for all. Multinational and national enterprises, wherever the principles of this Declaration are relevant to both, should be subject to the same expectations in respect of their conduct in general and their social practices in particular.’ Also, cf. OECD Guidelines (n 782) pt 1, paras 4 and 5.
See Alexandra Wawryk, ‘International Energy Law: An Emerging Academic Discipline’ in Paul Babie and Paul Leadbeter (eds), Law as Change: Engaging with the Life and Scholarship of Adrian Bradbrook (University of Adelaide Press 2014) 238; Vivian Kube and Ernst-Ulrich Petersmann, ‘Human Rights Law in International Investment Arbitration’ (2016) EUI Working Papers (Law 2016/02) 14.
Patrick Dumberry and Gabrielle Dumas-Aubin, ‘How to Impose Human Rights Obligations on Corporations under Investment Treaties? Pragmatic Guidelines for the Amendment of BITs’ (2011-2012) 4 Yearbook on International Investment Law and Policy 569; Kube and Petersmann (n 102) 13 and 14.
Cf Gabriel Arishe and Emmanuel Akpeme, ‘Reforming the Privity of Contract Rule in Nigeria’ (2014) 12 Nigerian Juridical Rev 185.
Bear Creek Mining v Peru, ICSID Case No. ARB/14/21.
Marie Miller, ‘’Morocco-Nigeria: Advancing Human Rights Protection in International Investment Treaties’ (January 2023) < https://www.culawreview.org/journal/morocco-nigeria-advancing-human-rights-protection-in-international-investment-treaties > accessed 18 December 2023.
Kube and Petersmann (n 10) 2.
See, for example, Social and Economic Rights Action Centre and Centre for Economic and Social Rights v Nigeria, Communication 155/96 (2001), concerning Nigeria’s complicity in the degradation of the Ogoni land.
See UNCTAD (n 186) 3.

Downloads
Published
Issue
Section
License
Copyright (c) 2024 Professor Olusesan Oliyide, Francis Ohiwere Oleghe, Professor Yinka Olomojobi

This work is licensed under a Creative Commons Attribution 4.0 International License.