Two ICSID awards against the Argentine Republic were annulled in 2010. In Sempra Energy International v The Argentine Republic (ICSID Case No ARB/02/16), Argentina's application for annulment was granted on the basis that the tribunal had manifestly exceeded its powers by adopting customary international law, rather than the bilateral investment treaty (BIT), as the primary source of law in relation to Argentina's defence of necessity. The decision was controversial because it was not entirely clear that the tribunal did, in fact, apply customary international law to the exclusion of the BIT. In Enron Creditors Recovery Corp, Ponderosa Assets, LP v Argentina (ICSID Case No ARB/01/3), the ad hoc committee partially annulled an award in which Argentina had been found to be in breach of the Argentina-US BIT. The focus of this decision was the way in which ILC Article 25 had been applied and the way in which customary international law informed the interpretation of the BIT necessity defence (in contrast to the Sempra annulment decision that the BIT should have been applied as a self standing provision). Both decisions call into question the extent of review assigned to an annulment committee which is, in theory, more limited than that of an appellate body. In addition, the decisions provide further support for the defence of necessity.

In Eureko BV v the Slovak Republic (PCA Case No 2008-13, UNCITRAL Arbitration Rules) Award on Jurisdiction, Arbitrability and Suspension, an UNCITRAL tribunal rejected the respondent's jurisdictional objection claiming that the BIT between Slovakia and the Netherlands was terminated by virtue of the accession of Slovakia to the EU. The award addresses the controversial issue of "intra-EU BITs" (see Intra-EU BITS below) and contains the tribunal's in-depth observations concerning the differences in the standard of investor protection offered under the BIT and EU law, and the European Commission's observations concerning intra-EU BITs. The award illustrates the potential competition between two overlapping regimes of international economic law: EU law on the one hand, and intra-EU BITs on the other.

In RosInvestCo UK Ltd v Russian Federation (SCC arbitration V (079/2005)), an SCC tribunal upheld RosInvestCo UK's claim that the Russian Federation had expropriated its investment in Yukos Oil (see Legal update, SCC tribunal upholds expropriation claim in Yukos arbitration). RosInvestCo UK alleged that its investment in Yukos had been expropriated in breach of the UK-Russia BIT and commenced arbitration under the rules of the Arbitration Institute of the Stockholm Chamber of Commerce (SCC). The tribunal rejected Russia's case that it had acted legitimately, finding that its actions had been discriminatory and not in good faith. It also held that the fact that RosInvestCo was not the beneficial owner of the shares when it purchased them or at the time of the expropriation did not prevent it from qualifying as an investor with an investment, given the wide definition of those terms in the BIT. However, when assessing damages, the tribunal took into account the fact that RosInvestCo had no economic interest in the shares until 2007, having transferred the beneficial interest in them to another group company. The tribunal awarded RosInvestCo only US$3.5 million, a fraction of the US$230 million claimed. This is the first decision on the merits in a series of arbitrations that have been brought against Russia by shareholders in Yukos. Although there is no system of precedent, no doubt the claimants in the other arbitrations will seek to rely on the tribunal's findings that there was an expropriation, although Russia has applied to set aside the award.

The issues that can arise from the interrelationship between EU law and international investment law (specifically investment treaties to which EU member states are party) have given rise to a good deal of debate in recent months and have recently been considered by a number of arbitral tribunals (see Legal updates, UNCITRAL tribunal rules Slovak-Dutch BIT not affected by Slovakia's EU membership and ICSID decision on relationship between ECT and EU law). In July 2010, the EU Commission published a proposed investment policy (see Legal update, Commission publishes EU investment policy and sets its approach to bilateral investment agreements between member states and third countries) which was followed by the EU Foreign Affairs Council's conclusions on a comprehensive European investment policy (see Legal update, Council adopts conclusions on a European foreign direct investment policy).

In 2010, the UNCITRAL Working Group II resumed its discussions on transparency in treaty-based investor-state arbitration (proposed revisions had previously been put on hold while the working group completed its review of the UNCITRAL Rules). The UNCITRAL Commission has tasked the working group with preparing a legal standard on the topic. At the latest meeting, the working group had preliminary discussions regarding the form and possible content of any standard, against the backdrop of widespread acknowledgement of the desirability of greater transparency in relation to international investment (see Legal update, UNCITRAL working group's report on transparency in investment arbitration). Discussions will continue at the next session, which will take place in New York on 7-11 February 2011.

In March 2009, an ICC Task Force on arbitration involving states or state entities was tasked with reviewing the ICC rules and procedures and their use in disputes involving a state party, in particular in investment treaty arbitration (this review is alongside the ICC Commission's main review of the ICC Rules of Arbitration). According to the ICC statistics in 2009, at least one of the parties was a state or state entity in 9.5% of cases. The Task Force met in 2010 to approve certain recommendations that will enhance the new ICC Rules in the settlement of such disputes. The new ICC rules are expected to be launched in 2011.