UNCITRAL working group's report on transparency in investment arbitration | Practical Law

UNCITRAL working group's report on transparency in investment arbitration | Practical Law

Publication of the report of the UNCITRAL Arbitration and Conciliation Working Group's 53rd session on 4-8 October 2010, on the subject of transparency in investment treaty arbitration. (free access).

UNCITRAL working group's report on transparency in investment arbitration

Practical Law UK Legal Update 6-503-6722 (Approx. 4 pages)

UNCITRAL working group's report on transparency in investment arbitration

by PLC Arbitration
Published on 26 Oct 2010 • International
Publication of the report of the UNCITRAL Arbitration and Conciliation Working Group's 53rd session on 4-8 October 2010, on the subject of transparency in investment treaty arbitration. (free access).
We previously reported that the UNCITRAL Arbitration and Conciliation Working Group (Working Group II) had resumed its discussions on transparency in investment treaty arbitration at its 53rd session in Vienna (Legal update, UNCITRAL resumes talks on transparency in investment arbitration). UNCITRAL has now published its report on that session.
The working group has been asked by UNCITRAL to prepare a legal standard on the topic of transparency in investment treaty arbitration. At this 53rd session, the group had preliminary discussions regarding the form and possible content of any standard. Those discussions took place against a backdrop of widespread acknowledgement of the desirability of greater transparency in relation to international investment. The ICSID Arbitration Rules were also amended in 2006 to incorporate greater transparency and opportunities for public access to investor-state arbitrations.
The main options in terms of the form of a legal standard are:
  • A supplement to the UNCITRAL Arbitration Rules, either as an annex or as a stand-alone set of rules on transparency.
  • Guidelines.
  • Model clauses.
Much of the discussion on form concentrated on the applicability of any legal standard. In this context, it was recognised that there are two different levels of consent to arbitrate at which the standard would need to apply: the consent between state parties to an investment treaty, and the consent between the host state and an investor as parties to the dispute.
The working group identified the following issues:
  • Whether future investment treaties would have to contain express reference to rules on transparency, in addition to referring to the UNCITRAL Arbitration Rules, for the transparency rules to apply.
  • How rules on transparency would apply in the case of existing treaties.
  • Whether an investor would be bound by an offer by a state to arbitrate under the UNCITRAL Rules, including the rules on transparency, or whether it would be able to refuse the offer of transparent arbitration.
  • The extent to which investor and state parties to a dispute should be able to depart from rules on transparency.
No conclusions were reached on any of these issues at this stage.
In terms of the content of the legal standard, delegates agreed that the substantive issues to be considered in this context would be:
  • Publicity regarding the commencement of arbitral proceedings. Different views were expressed regarding the information which should be made public and when.
  • Publication of documents, such as pleadings, supporting documents and procedural orders.
  • Submissions by third parties. There was strong support, in principle, for third party (or amicus curiae) submissions, which could be useful for the tribunal in resolving the dispute and promoted the legitimacy of the arbitral process.
  • Public hearings. The working group clarified that these were hearings that the public were allowed to attend but not actively participate in. Outstanding questions included whether hearings should be public by default or whether it should be up to the tribunal to decide.
  • Publication of arbitral awards. The UNCITRAL Arbitration Rules 1976 and 2010 require the parties to consent to the publication of an award. However, there was much support for a provision requiring publication of awards in investor-state arbitration.
  • Possible exceptions to the transparency rules to protect confidential and sensitive information.
  • Creation of a repository of published information. It was suggested that it would be logical for the UNCITRAL Secretariat to act as a registry for publicly available information about investment treaty arbitrations. The Permanent Court of Arbitration also confirmed that it would be prepared to provide this service.
Discussions will continue at the next session, which will take place in New York on 7-11 February 2011. In readiness for that session, the working group has asked the Secretariat to prepare examples of provisions on transparency in treaty-based investor-state arbitration and, if possible, model provisions for discussion.
Source: UNCITRAL.