UNIVERSITA’DEGLISTUDIDINAPOLIFEDERICOII

DIPARTIMENTODIGIURISPRUDENZA

DOTTORATODIRICERCA

in

TUTELAGIURISDIZIONALEDEIDIRITTI

NELL’ORDINAMENTONAZIONALEEDINTERNAZIONALE

XXVIIICiclo

MANAGINGPARALLELPROCEEDINGS

ININVESTMENTARBITRATION

TUTOR CANDIDATO

Prof.MassimoIovaneAvv.GiovanniZarra

Prof.LoukasA.Mistelis

AnnoAccademico2016/2017

1

MANAGINGPARALLELPROCEEDINGSININTERNATIONALINVESTMENTARBITRATION

DoctoralthesisofG.ZarraSupervisedbyProf.M.IovaneandProf.L.A.Mistelis

Introductory remarks, analysis of the scope of the work, methodology and literaturereview………………………………………………………………………………………………………………………....4

SECTION1

Theproblemofparallelproceedingsininternationalinvestmentarbitration:thenecessityforasolutionbeyondpartyautonomy

IntroductionParallelproceedingsasacrucialproblemofinvestmentarbitration…………………………………………14

0.1 The criticism relating to investment arbitration. A critic to the critics and thereaffirmation of arbitration as the preferred form of investment disputesettlement……………………………………………………………………………………………...14

0.1.1 Independence………………………………………………………………………160.1.2 Openness…………………………………………………………………………….180.1.3 Accountability……………………………………………………………………..20

0.2 Systemic features in investment arbitration: a network needing internalcoherence……………………………………………………………………………………………….21

Chapter1Internationalinvestmentarbitrationandtheneedforcoherence…………………………………………….31

1.1 Thetaxonomyofmultipleclaimsandtheinevitabilityofparallelproceedings…….311.1.1 Contractandtreatyclaims……………………………………………………..331.1.2 Majority and minority shareholders (or company and its

shareholders)……………………………………………………………………….371.1.3 Chainofentitiesofthesamegroup………………………………………….411.1.4 Different adjudication systems provided in the same legal

instrument…………………………………………………………………………..451.2 The reason behind parallel proceedings: the historical necessity to incentivize

investments…………………………………………………………………………………………….461.3 Policyconsiderationsagainstparallelproceedings…………………………………………52

1.3.1 Reliability and legitimacy of the adjudication process and theprincipleoflegalcertainty………………………..……………………………53

1.3.2 Judicialeconomyandtheneedforefficiencyinthedecisionmakingprocess……………………………………………………………………………….57

1.3.3 Fairnessandfinality………………………………………………………………601.4 Necessity of a general remedy for ensuring consistency and finality. The

impossibility to find a solution at the jurisdictional stage: the central role of

2

arbitrators and the necessity to go beyond party autonomy. Plan of the nextchapters………………………………………………………………………………………………….61

Chapter2The inappropriateness of traditional remedies based on party autonomy or on the discretion ofarbitrators and the Inadequacy of the solutions set forth in institutional commercial arbitrationrules………………………………………………………………………………..…………………………………………69

2.1 Remedies based on party autonomy (and secondarily on arbitrators’discretion).............................................................................................................71

2.1.1 Forum selection options, fork-in-the-road and waiverclauses…….................................................................................................712.1.2 Introduction to multiparty and multicontract situations in

international commercial arbitration and possible applications ininvestmentarbitration…………………………………………………………..772.1.2.1 Joinder and intervention: Looking for an implied

consent? Themethodologies applied in internationalcommercial arbitration and their fallacy if applied ininvestmentarbitration……………………………………….78

2.1.2.2 Consolidation:theCMEandCornProductscases……882.1.2.3 Quasiconsolidation…………………………………………..93

2.1.3 Collectiveproceedingsstartedbyinvestors(inanutshell)…942.2 Remediesbasedonarbitrators’discretiononly……………………………………………..97

2.2.1 Forumnonconveniens,comityandthesuspensionofproceedings..982.2.2 Arbitral anti-suit injunctions and the infringement of kompetenz-

kompetenz………………………………………………………………………….1012.3 Conclusions……………………………………………………………………………………………104

SECTION2

RemediestotheproblemofparallelproceedingsChapter3Abuse of process, res judicata and collateral estoppel: the available tools against parallelproceedings………………………………………………………………………………………………………………..106

3.1 Jurisdictionandadmissibility.Thelegalbasisforthedistinctionanditsrole inthefightagainstparallelproceedings………………………………………………………………107

3.2 The applicability of general principles of international law in investmentarbitration……………………………………………………………………………………………..113

3.3 Aninadequatesolutionfortheproblemofparallelproceedings:the“first intime”rule……………………………………………………………………………………………………….119

3.4 Sources of general international law providing for solutions to the problem ofparallel proceedings: the principles of good faith and ne bis in idem and theirconcreteapplications………………………………………………………………………………122

3.5 Abuseofprocessininternationalinvestmentarbitration……………………………….128

3

3.6 Resjudicata(claimpreclusion)…………………………………………………………………..1343.6.1 Definition of res judicata and its role in ensuring the goal of the

process……………………………………………………………………………..1343.6.2 Thetraditionalapproachtores judicata:Thetriple identitytestand

therequirementofthesamelegalorder.TheCME/Laudercasesanda critic to the triple identity test as an over-formalistic approach,whichdoesnottakeintoaccountsubstance……………………………138

3.6.3 The requirements of petitum and causa petendi and the call for amoreflexibleapproach.TheSouthernBluefinTunacase……………140

3.6.4 The requirement of identical parties: the effects of internationalawardsonrelatedthirdparties………………………………………………145

3.6.5 Thesamelegalorder(inbrief)……………………………………………….1503.7 Collateralestoppel(issuepreclusion)………………………………………………………….153

3.7.1 Development and requirements of collateral estoppel: A broaderconceptofprivityandthenecessitytorespectdueprocess………..153

3.7.2 Collateral estoppel in international investment law: The RSM andApotexcases,thecallforamoreflexibleapproachandthesourceofjudges’powertoapplysuchanapproach………………………………..157

3.8 Concreteapplicationsoftheproposedsolutionsininvestmentarbitration……….1613.9 A solutionde jure condendo in order to preserve due process in case ofmultiple

claims by shareholders: the possible third parties’ right to be informed and tointerveneintheproceedings…………………………………………………………………….164

3.10 Conclusions……………………………………………………………………………………………166Chapter4Post-awardremedies……………………………………………………………………………………………………168

4.1 ICSIDarbitrationasaselfcontainedregimeandthenecessitytofindasolutiontoparallelproceedingswithinitsboundaries…………………………………………………..169

4.2 Non-ICSIDinvestmentarbitrationandpossibleremediestoparallelproceedingsattheenforcementandsetasidestagesofarbitralawards……………………………….1724.2.1 Theregimeofthe1958NewYorkConventionandthepossibleapplicability

of the public policy exception to avoid the enforcement of duplicativeawards………………………………………………………………………………………..172

4.2.2 Concreteapplicationoftheproposedsolution…………………………………..1814.3 Challengingnon-ICSIDawardsarisingfromduplicativeproceedingsat theseatof

arbitration(inbrief)…………………………………………………………………………………184Conclusions……………………………………………………………………………………………………………….187Bibliography……………………………………………………………………………………………………………..191

4

Introductoryremarks,scopeofthework,methodology,structureandliteraturereview

It iscommonlysaidthat internationalarbitration isthemostpopularmethod

of dispute resolution for international commercial disputes. This is probably eventruer with regard to international disputes which involve, on the one side, privateinvestors and, on the other side, the States where such investors made theirinvestments(so-calledinternational investmentarbitration). It is, indeed,possibletosaythatinvestmentarbitrationhasbecomethenaturaljudgeofthiskindofdisputes,due– firstofall – to theperceivedbiasof themainotheravailable formofdisputesettlement,i.e.litigationinnationalcourtsofthehostState,and–secondly–totheimpossibilitytoforeseethepossibleoutcomesofthetraditionalremedyprovidedbyinternationallaw,i.e.diplomaticprotection.

The huge growth of the number of investment arbitration cases is a recentphenomenon. At the beginning of its activity, the International Centre for theSettlement of Investment Disputes (ICSID), established by the 1965 WashingtonConvention and today the main institution administering investment arbitrationproceedings, registered very few cases per year. However, the entry into force ofthousands of Bilateral Investment Treaties (BITs), as well as of several investmentcontractscontainingarbitrationclauses,has leadtoa rapidchangeof thissituation.BITs always contain an offer (i.e. an advanced consent) by the State hosting theforeign investment to arbitrate future possible disputes with investors with thenationalityoftheothersignatoryStatebeforeneutralarbitraltribunals.Sucharbitraltribunalswill be entitled to settledisputesbyusually applying theprovisionsof thesameBITs,internationallawandthelawofthehostState.Theabovementionedofferis aimedatencouraging foreign investments,byguaranteeing to investors thatanydispute against the host State will not be settled by national courts, which areperceivedtobebiasedinfavourofthehostState.

States’consenttoarbitrationisusuallyexpressedinverybroadterms.Indeed,itinvolvesdisputesarisingfromallkindofinvestmentencompassedthedefinitionof“investment”containedinthesameBIT.Suchadefinitionusuallyrefersto“everykindofasset”,includingalsosharesandindirectinterestsincompaniesincorporatedinthehostState.

The expansion of investment arbitration, however, is also due to the veryflexibleapproachthatarbitratorshavehadinassumingjurisdiction.Indeed,tribunalshaveusuallystrictlyappliedthecriteriafortreatyinterpretationsetforthinthe1969ViennaConventionontheLawofTreaties(inparticular,amongsuchcriteria,tribunalshaveusuallystressedtheimportanceofaliteralinterpretationofconsentexpressedinBITsandofdefinitionsofinvestment)andthisapproachhasentitledthemtobroadenthenumberofdisputesthatpotentiallymaybebroughtbeforeinvestmentarbitrationtribunals,duetothealreadymentionedverywideformulationofsuchclauses.

5

Thishas lead to the riskof possible abusesby investors.By structuring theircompanies with amultinational structure, investorsmay take advantage of severalBITs at the same time and start several parallel proceedings arising from the samefacts.Thesamemayhappenifseveralshareholdersofthesamecompany,allofthemhavingtherighttostartaninvestmentclaim,allstartseparateinvestmentclaimsforthesamedamagesufferedbythecompany.Itmayalsohappenthat,beingacontractbetween the host State and the investor in force, the investor starts both anarbitration under the arbitration clause contained in the contract and anotherarbitrationaccordingtotheoffercontainedintheBIT.

In all these cases, from a formal point of view, investors are exercising theirrightsandare fullyentitled todoso.Moreover, ifoneanalysesparallelproceedingsfrom the perspective of the three requirements commonly used to identify a legaldispute(namelyidentityoftheparties,oftheobjectandofthegroundoftheclaim),theparallelproceedingsareusuallyformallydifferent,duetothelackofidentityofatleastoneofsuchrequirements.Thismeansthat,ifthetraditionalrulesonpreclusion(such as res judicata) are strictly applied (and such a strict application, requiringperfectidentityofalltheaboverequirements,iscurrentlyendorsedbythemajorityofAuthors and arbitral tribunals), there is no bar to the continuance of the secondduplicativeprocess.

However,severalpolicyconsiderationsmilitateagainstthisoutcome. Indeed,intoday’sinternationalcommerce,valuessuchascoherence,finalityofdecisionsandefficiency of themethods of dispute resolution are of extreme importance. Parallelproceedingsininvestmentarbitrationleadtoneverendingdisputes,theyunderminelegal certaintywith the riskof conflictingoutcomesand increase timeandcosts forthepartiesofthedispute.Theseproblemsareevengreaterifoneconsidersthatoneof the parties in investment arbitration is a State, which takes part to theseproceedings by spending public resources. Furthermore, these disputes usuallyinvolve sectorsof theStates’ economy that are essential for thepublic life, suchaswater, electricity, and telecommunications. For the above reasons, parallelproceedingsconstituteawasteofpublicmoneyand risk tohavebadeffectson thequalityoflifeofpeopleoftheStateinvolvedinthedispute.

Finally,allowingparallelproceedingswouldmeanalsounderminingthesamefunction of arbitration as a method of dispute settlement. It is strongly arguable,indeed, that arbitration fulfils its function if and when it finally settles the disputeunderlying the claimsof theparties. If,whenproceedings terminate, the claimsaresettled but the dispute between the parties still exists and is pending in anotherarbitration, which is only formally different from the first one, it is arguable thatarbitration has failed in fulfilling its function. In conclusion, the prevalence of theformalitiesoftheprocessovertherealsubstanceoflegalrelationshipsmayleadtoalackoftrustinarbitrationasamethodofdisputesettlement.

Asolutionisthereforerequired.

6

Such a solution, however, may not be found at the jurisdictional stage ofarbitralproceedings. Indeed, jurisdictioninarbitrationisbasedonthegoldenruleofconsent and arbitrators do not have the power to decline a validly conferredjurisdiction.Allsolutionsthathavebeenimaginedforsolvingtheproblemofparallelproceedingsat the jurisdictional stageare therefore veryartificial (indeed, it is veryunlikelythataninvestorwillrenouncetoitsrighttobringitsseparateclaim).

On the contrary, a solution to the problemof parallel proceedingsmight befoundattheadmissibilitystageofarbitralproceedings, i.e.thestageofproceedingswherearbitratorsmaydecidethattheexerciseofthevalidlyconferredjurisdictionisnotappropriatefortheinterestofjustice.Here,bywayofpreliminaryobjections,theparties may ask to arbitrators to examine certain merit issues, which have thepotential to absorb (i.e. to preclude) the discussion of the entire dispute. Suchpreliminary questions may be related to the existence of a previous award (or ofalreadypendingproceedings)onthesamedispute.

The goal of this book is to identify the existence of certain principles ofinternational law thatmaybeusedbyarbitrators inorder to justifyadeclarationofinadmissibilityofduplicativeproceedings.Suchprinciplesmightbe identified in theprincipleofgoodfaithandtheprincipleof finality (nebis in idem).Theformer isthelegalbasis for theapplicationof thedoctrineofabuseofprocess,while the latter isthe concept underlying the doctrines of claim preclusion (res judicata) and issuepreclusion (collateral estoppel). The core of the analysis will therefore be aimed atunderstanding whether abuse of process, res judicata and collateral estoppel mayconstituteusefultoolsinordertopreventtheissuanceoftwoawardsarisingfromthesamedispute.

The central thesis underlying this research is that arbitral tribunals shouldendorse a flexible, pragmatic and substance oriented approach to the principles ofabuseof process, res judicataand collateral estoppel in order to limit the effects ofparallel proceedings, to prohibit abuses of the method of dispute settlement byinvestors and, finally, to safeguard the credibility of investment arbitration. Such atransactionalapproach,whichhasbeenseveraltimesdefinedashighlydesirableandwhich has recently found some disparate applications in investment arbitration,1isnot the product of the imagination of the author, but comes from a re-elaboratedversion of several theories originated inmunicipal systems (and sometimes alreadyappliedininternationallaw)asadaptedtotheframeworkofinternationalinvestmentarbitration.

ScopeoftheworkanddelimitationThis bookwill assume the perspective of an arbitral tribunal dealingwith an

international investmentdispute in thecontextof twoormoreparallelproceedings

1SGrynberg,StephenMGrynberg,MiriamZGrynberg,andRSMProductionCorporationvGrenada,ICSIDCaseNoARB/10/6,Award,10December2010;ApotexHoldingsInc.andApotexInc.v.UnitedStatesofAmerica,ICSIDCaseNo.ARB(AF)/12/1,Award,25August2014.

7

andwill try to understand how such a tribunal canmanage the issues arising fromsuch a situation. This research does not cover the issue of parallel proceedingsbetween arbitral tribunals and national courts, aswell as between arbitral tribunalsand other international courts and tribunals. It only covers parallel proceedingsbetweentwoarbitraltribunalsdealingwith investmentdisputesandthe legal issuesstrictlyrelatedorfunctionaltotheanalysisofthemaintopicoftheresearch.

MethodologyTheentireanalysiscarriedoutinthisbookisbasedonamainassumption,i.e.

that international investment arbitration fulfils a public and substantial function.Indeed, as already stated, the author starts from the assumption that investmentarbitration isnotonlyawaytosettletheclaimsthatarebroughtbeforearbitrators,but is a way to finally settle the underlying disputes and to finally stabilize theunderlying legal relationship. This approach is due, inter alia, to the necessity toensurethataformofarbitrationthathasseveralpublicfeaturesandthatdecidesonissuesthatareofvitalimportancefortheinvolvedStatescannotbeadministeredforthesoleinterestoftheformalpartiesandbygivingprevalencetotheinterestsoftheinvestorsovertheonesoftheStates.

The research will be, therefore, policy-oriented. The necessities to promotecoherence,predictabilityofsolutionsandlegalcertainty,aswellastoensurefinalityandreducetimesandcostsinarbitration,willbethemaindriversoftheresearch.Itisstrongly arguable, indeed, that international investment arbitration has todaybecomethenaturalforumfordisputesonforeigninvestmentand,therefore, itshallnotonlybedrivenbytheinterestofinvestors(possiblyaimedatincreasingtheforumswhichcouldhearthesamedisputeinordertogetmorechancesofsuccess)butalsoby policy considerations developed by scholars and practitioners aimed at grantingthe reliability and the credibility of thismethod of dispute settlement. This kind ofreasoning, deeply developed by Thomas Hale,2is an essential policy driver of thisresearch. If, as stated by Hale,3institutions andmethods of dispute settlement areconsideredreliablebyoperatorsonthebasisofthepolicyoutcomeoftheirdecisions(i.e. thedegreeofsatisfactionofbothparties involved inthedispute,whichdirectlyaffectstheircredibility),itisessentialthatphenomenalikeparallelproceedings,which

2Hale,BetweenInterestsandLaw(2015),9andss.and51andss.ThisAuthor,at11,statesthat“withintheboundariesimposedbymaterialinterests,legalideasandthecommunitiesofexpertsthatpromotethemhaveoftenbeenthemostproximatedriversof institutionalvariation”,evenagainstthemarketpowers of market actors which have created and used an institution and/or a method of disputesettlement inordertoservetheir interests.Allconsiderationsde jurecondendomade inthisbookaretherefore aimed at a policy driven improvement of international investment arbitration aimed atgrantingthecredibilityandthereliabilityofthismethodofdisputesettlement.3Id.52andss.TheAuthorspeaksaboutarequirementofneutralityforarbitralinstitutions,whichshallnot give prevalence to the interests of one of the categories involved in the dispute: in the case ofinvestment arbitration, if arbitral tribunals are perceived to be biased in favor of investors, theywillloosecredibilityfromtheperspectiveofStates.ConsideringthatStatesarethesubjectswhichfinallygranttheexistenceofinvestmentarbitration,suchalossofcredibilitymayfinallyputatriskthesameexistenceofinvestmentarbitrationasamethodofdisputesettlement.

8

–beingperceivedasanunduedisadvantagefortheinterestsoftheStateinvolvedinthedispute–underminethecredibility(and,finally,thesameexistence)oftheentiremethodofdisputeresolutiongivenbyinvestmentarbitration,areavoidedoratleastlimited.Thiscouldbedone,as itwillbeseen inChapter3of thisbook,byapplyingalready existing legal rules (such as abuse of process, res judicata and collateralestoppel) in a less formalway, as proposed by several scholars and, today, also bycertain arbitral tribunals. This approach follows the idea that “[t]he practice of lawforcesactorstologicallydeducea‘correct’principlefromabodyoftextandpractice,and so we should expect logics of appropriateness to be particularly prominent”(emphasis added). 4 This means that, among the various interpretations of theaforementioned legal principles, it is necessary to adopt the one that bettersafeguardsthecredibilityofinvestmentarbitration,bystrikingabalancebetweenthevariousinterestsinvolvedininvestmentdisputes.

However,itisnotpossibletoignoresomevaluesthat,inprinciple,mayconflictwith theaforementionedpolicy considerations.The referencegoes, inparticular, tothenecessitytoensurepartyautonomyanddueprocess,aswellastothedesirabilitytohaveawardsthatarethemostpossiblefairandjust.Forthisreason,theauthorhastried to highlight in the text these clashes of values anytime they may realize inpractice and has also tried to offer some balanced solutions to such clashes thatshould not undermine any of the aforementioned values. Striking this balance isessential in order to safeguard all the interests involved in investment disputes,withoutgivingprevalencetoStatepartiesorinvestors.

Finally, it is worth noting that the subject of this book involves severalterminologicalproblems.Labelssuchas“parallelproceedings”,“lispendens”,“nebisin idem”and “res judicata”areoftenusedwithdifferentmeaningsand, seldom, therecourse to such names is made improperly. For this reason, in order to avoidconfusion,inthecourseofthebookthemeaningwithwhichthislabelsareusedwillbealwaysclarified.

StructureoftheworkThefirstquestionthatthisbooktriestoanswer–inintroductiontoSection1–

iswhetheradissertationonparallelproceedingsin investmentarbitrationisactuallyrequired.Inordertoanswertosuchaquestion,thisworkstartsfromananalysisofthemaincriticismsthathavebeenmovedagainstinvestmentarbitration,namelythatitisa partial (pro-investor)methodof dispute settlement, that it lacks of openness andaccountabilityandthatitlackofcoherence,predictabilityandlegalcertainty.Itwillbedemonstrated that all these criticisms have been remedied by operators unless thelack of coherence, predictability and legal certainty (Paragraph 0.1).5This lack ofcoherence is particularly due to the phenomenon of parallel proceedings, i.e.

4Hale(2015)(n.2),74.5EuropeanFederation for InvestmentLawandArbitration (EFILA),Aresponse to thecriticismagainstISDS,17May2015(2015).

9

substantially identical disputes which have the potential to end with very differentoutcomes,whichunderminethecredibilityofinvestmentarbitration.Theparadigmofthis situation is represented by the well known Lauder6and CME7cases, where thefinalownerofachainofcompaniesandoneofsuchcompaniesinitiatedtwoparalleldisputesagainst theCzechRepublic,arising fromthesame facts,whichendedwithoppositejudgments.However,priortosaythatasolutiontothissituationisrequired,itwillbealsonecessarytoascertainwhetheracertaindegreeoforderlinessisrequiredin investment arbitration: if one says that investment arbitration tribunals operatewithouttakingintoaccounttheworkofeachother,thismeansthatthereisnoneedof coherence. Anyway, it is arguable that there are several systemic features ininvestment arbitration, which lead us to talk about a network requiring internalcoherence(Paragraph0.2).Thisimposestoseekforasolutiontoparallelproceedings.

In dealing with the problem of parallel proceedings, the research starts, inChapter1,withadescriptionofthetaxonomyofparallelproceedings(Paragraph1.1)andwithananalysisofthemostlikelyreasonsbehindthegrowthofthisphenomenon(Paragraph 1.2). Chapter 1, finally, deeply analyses the already mentioned policyconsiderationsatthebasisoftheresearch(Paragraph1.3).

Thefollowingstructureof theresearchfollowsthetemporalsequenceof thevarious phases of arbitration where the problemmay emerge, namely jurisdiction,admissibilityandpost-award.

The analysis starts – at Chapter 2 – by examining the jurisdictional stage,where, as itwill bedemonstrated, there areno solutions to theproblemof parallelproceedings. Indeed,thisphase isbasedonthegrundnormofconsentandtherearenoavailablelegaltoolsthatallowarbitratorstodeclinejurisdictiondisregardingpartyautonomy(Paragraph2.1).Similarly,remediesbasedonasoleexerciseofdiscretion(suchascomity)arenotreliableinordertofindapredictablesolutiontotheproblemofparallelproceedings(Paragraph2.2).

Theresearchthenmovestotheanalysisoftheremediesavailableatthestageofadmissibility.Thismethodologicallyimposestopreliminarydealwithseveralotherquestions, such as the legal foundation of the distinction between jurisdiction andadmissibility(Paragraph3.1),theanalysisoftheinherentpowers(ifany)ofarbitratorsto safeguard the interests of justicewhile administering their proceedings, and thelawapplicable in international investmentarbitration (withaparticular focuson theapplicabilityofgeneralprinciplesofinternationallaw)(Paragraph3.2).Wewillfirstofalldemonstratethatinternationallawprovidesuswithsomeinstrumentsinordertoavoidparallel proceedings (not including lis pendens, as demonstrated inParagraph3.3),namelytheprinciplesofgoodfaithandfinality(Paragraph3.4).Theseprinciplesrespectivelyfurnishthegroundsforthedoctrineofabuseofprocess,ontheoneside,andresjudicataandcollateralestoppel,ontheotherside.Itwillbethennecessarytounderstand how andwhether these toolsmay be applied in investment arbitration

6RonaldS.Lauderv.CzechRepublic,UNCITRAL,FinalAward,3September2001.7CMEv.CzechRepublic,UNCITRAL,FinalAward14March2003.

10

(Paragraphs3.5,3.6and3.7).Thiswillrequire,firstly,ananalysisofthesedoctrinesininternationallawand,secondly,acomparativeanalysisofhowtheyhavebeenappliedindifferentmunicipalsystems(withaparticularfocusonthedistinctionbetweencivillawand common law systems). Itwill finally emerge that suchdoctrineshavebeenappliedalsoinaflexibleandsubstance-orientedway,whichwouldbeveryhelpfulinordertolimitparallelproceedings.Thisapproachis,indeed,highlydesirable.Chapter3alsodemonstrateshowthesedoctrinesmayoperateinconcrete(Paragraph3.8)andputforwardaproposalofamendmentofrulesofinternationalarbitrationinordertolimit parallel proceedings and, at the same time, ensure the respect of dueprocess(Paragraph3.9).

Finally,remediesavailableatpost-awardstagewillbeexaminedinChapter4.These remedies are different with regard to ICSID awards – being ICSID a self-contained regime – and with regard to non-ICSID awards, which shall be enforcedaccordingtotheprovisionsofthe1958NewYorkConventionontheRecognitionandEnforcementofForeignArbitralAwards.Intheformercase,wewilltrytounderstandwhethertheremedyofannulmentprovidedbytheICSIDConventionmaybeusefulinorder toavoid theexistenceof twoduplicativeawards (Paragraph4.1). In the lattercasetheonlyavailablemeanstoprecludetheenforcementofaduplicativeaward isthepublicpolicyexceptionsetforthinArt.V(2)(b)oftheNewYorkConvention.Theanalysis of the public policy exception involves several difficulties due to theinvolvement of municipal laws and courts and will require an examination of thenational rules of private international law regulating the problem of conflictingjudgments(Paragraph4.2).Finally,Paragraph4.3willtrytounderstandwhethertheexistenceof duplicative awardsmaybe a ground for annulment at theplaceof theseatofarbitration.

LiteraturereviewThesubjectofparallelproceedingsininvestmentarbitration,asoftoday,has

not beenwidely discussed. There are, however, fourmonographs that – directly orindirectly–regardthesubject,aswellassomearticles.Finally,theInternationalLawAssociation, due to the uncertainty related to this topic, has issued certainRecommendations on LisPendens andRes Judicata in InternationalArbitration.8SuchRecommendations, issued for the context of commercial arbitration, may besomehowhelpfulforananalysisregardinginvestmentarbitration,providedthatonekeeps always into account the differences existing between these two forms ofarbitration.

The startingpointof a researchaimedat assessing concurring jurisdiction ininternational law is Yuval Shany’s seminal work on “The Competing Jurisdictions of

8DeLy,Sheppard, ILAFinalReportonLisPendensandArbitration,Arbitration International (2009), 3and ss.; De Ly, Sheppard, ILA Final Report on Res Judicata and Arbitration, Arbitration International(2009),35andss.

11

InternationalCourtsandTribunals”.9Thisbook is veryhelpful inorder tounderstandtherelationsandpossibleinteractionsbetweeninternationalcourtsandtribunals,aswellasbetweeninternationalcourtsandtribunalsandnationalcourts.Furthermore,thisbookisonethefirstworksthathasproposedaflexibleapproachtothedoctrinesapplicableinordertoavoidparallelproceedings.

The second main source for a work on parallel proceedings in investmentarbitration isProf.McLachlan’sbook recallinghis courseheld in 2009at theHagueAcademy of International Law, entitled Lis Pendens in International Litigation,10inwhichtheapplicationoflispendensandresjudicatainarbitration(mainlycommercial)islargelydebated.

Another good source, encyclopaedic in its exposition, is prof. Hober’s bookrecallinghiscourseheldin2013attheHagueAcademyofInternationalLaw,11whichhasdiscussedthesubjectsalsofromtheperspectiveofinvestmentarbitration,evenifwithoutbeingparticularlyinnovative.

Finally, the main (and only) book directly regarding the subject is HannoWehland’smonographentitledTheCoordinationofMultipleProceedingsinInvestmentTreatyArbitration.12However,thisbooklargelydiffersinitsscopeandgoalsfromthepresentone.Firstofall itlargelyexaminestheissueofparallelproceedingsbetweeninvestmenttribunalsandnationalcourts (that isnotwithinthescopeofthepresentbook).Secondly,andmainly,itendorsesaveryformalisticapproachtothedoctrineofresjudicatathatisrejectedbythepresentAuthor.Finally,itdoesnotdealwithabuseofprocessandcollateralestoppel,whicharelargelydiscussedinthepresentbook.Inconclusion,Wehland’sbook,helpfulforitswideanalysisofthesubjectandforitsveryextensive bibliography, does not propose solutions to the problem of parallelproceedings.

Onlyfourarticlesdirectlydealwiththeissueofabuseofprocessininvestmentarbitrationfromtheperspectiveofparallelproceedings.13Withregardtores judicataandinvestmentarbitration,itisworthhighlightingsixarticles14andonelegalopinionissued in the frameworkofan investmentcase.15Finally,onlyone recentarticlehas

9CambridgeUniversityPress(2013).10PublicationsofTheHagueAcademyofInternationalLaw,(2009).11Hober,ResJudicataandLisPendensinInternationalArbitration,Recueildecoursesvol.366103(2013).12OxfordUniversityPress(2013).13Ascensio, Chinese Journal of International Law (2014), 763 and ss.; De Brabandere, Journal ofInternationalDisputeSettlement(2012),609andss.;Gaffney,JournalofWorldInvestmentandTrade(2010),515andss.;Brown,TransnationalDisputeManagement(2011),1andss.14Reinisch,TheLawandPracticeofInternationalCourtsandTribunals(2004),37andss;Reinisch,TheBacklash against InvestmentArbitration (2010), 113;Martinez Fraga, Samra,Northwestern Journal ofInternational Law and Business (2012), 419 and ss.; Shany,http://papers.ssrn.com/sol3/papers.cfm?abstract_id=999021 (2007),1andss.; Id.,AmericanReviewofInternationalLaw(2005),835andss.,Dodge,HastingsInternational&ComparativeLawReview(2000),357andss.15Schreuer,Reinisch,LegalopinionintheCMEv.CzechRepubliccase,www.italaw.com(2002)

12

dealt with collateral estoppel in investment arbitration.16Some books and articleshavedealtwiththeproblemofparallelproceedingsingeneralterms.17

Duetothisscarcityofsources,ithasbeennecessarytomakerecourse,firstofall, tobooksandarticlesrelatedtogeneral international law,18secondlytoworksoninternational commercial arbitration19and, thirdly, to works related to municipalsystems.20All these sources have been of extreme utility in order to develop newapproachesandsolutionsforinvestmentarbitration.

Finally,with regard to ILA’sRecommendations, theyareusefulbecause theyrecall the current practice of national laws, as well as of international courts andtribunals,inordertoofferthecompleteframeworkregardingthecurrentstatusofresjudicata ininvestmentarbitration.However,suchRecommendationsarenotdecisivefor the goals of the present book, first of all because they are mainly directed tointernationalcommercialarbitrationpractitionersand,secondly,becausetheirscope

16Kotuby,Egerton-Vernon,ICSIDReviewFILJ(2015)486andss.17Cremades, Lew (eds.), Parallel States and Arbitral Procedures in International Arbitration (2005),Savarese, www.federalismi.it (2009), Cremades, Madalena, Parallel Proceedings in InternationalArbitration, 24Arbitration International (2008), 507 and ss., Carver, Journal ofWorld Investment andTrade (2004), 23 and ss., Spoorenberg, Vinuales, Law& Practice of International Courts& Tribunals(2009),91andss.,Hansen,ModernLawReview(2010)523andss.,Klein,JournalofWorldInvestmentand Trade (2004), 19 and ss., Yannaca-Small, The Oxford Handbook of International Investment Law(2008),1010andss.18Fortheaimofthepresentbookthefollowingaresomeverysignificantworks:Lowe,AfricanJournalof International&ComparativeLaw (1996), 38and ss., Id.,AustralianYearbookof InternationalLaw(1999),191andss.,Scobbie,AustralianYearbookofInternationalLaw(1999),299andss.,Al-Qahtani,TheLawandPracticeof InternationalCourtsandTribunals (2003),269andss.,Bonafè,LaprotezionedegliinteressidiStatiterzidavantiallaCorteinternazionalediGiustizia(2014),Palombino,Glieffettidellasentenza internazionale nei giudizi interni (2008),Oellers-Frahm,MaxPanckUNYB (2001), 67 and ss.,Gaja, The Statute of the International Court of Justice (2012), Cannizzaro, European Journal of LegalStudieswww.ejls.eu (2007), Abi-Saab,NewYorkUniversity Journal of International Law andPolitics(1999),919andss.,Treves,NewYorkUniversityJournalof InternationalLawandPolitics (1999),809and ss., Charney, NewYorkUniversity Journal of International Law and Politics (1999), 697 and ss.,Dupuy, New York University Journal of International Law and Politics (1999), 791 and ss., Romano,International Law and Politics (1999), 709 and ss., Palchetti, Max Planck UNYB (2002), 139 and ss.,Forlati, Rivista di diritto internazionale (2002), 99 and ss., Virzo, Il regolamento delle controversie neldirittodelmare:rapportitraprocedimenti,(2008),Zoppo,LasoluzionedellecontroversiecommercialitraStati tramultilateralismoe regionalism (2013),Palombino,LeidenJournalof InternationalLaw (2010),909andss.19See, interalia,RadicatidiBrozolo,ssrn.com/abstract=1842685(2011),Gunes,TransnationalDisputeManagement(2015),1andss.,deLotbiniéreMcDougall,TransnationalDisputeManagement(2012),1and ss., Brekoulakis, American Review of International Arbitration (2005), 1 and ss., Ricci, Rivista didiritto processuale (1989), 655 and ss., Hanotiau, Hanotiau, Complex Arbitrations: Multiparty,Multicontract,Multi-IssueandClassActions(2006),PermanentCourtofArbitration(ed.),MultiplePartyin International Arbitration (2009), Brekoulakis, Third Parties in International Commercial Arbitration(2010).20See, inter alia, Allorio, La cosa giudicata rispetto ai terzi (1935), 1 and ss., Carnelutti, Istituzioni delprocesso civile italiano (1956), 79,Carnelutti,Studididirittoprocessuale (1925), 443,Vestal,St. LouisUniversityLaw Journal29 (1964-1965),Vestal, IowaLawRev. (1968) 1 and ss.,Casad,Clermont,ResJudicata, An Handbook on Its Theory, Doctrine and Practice (2001), Volpino, L’oggetto del giudicatonell’esperienza americana (2007), Chizzini, L’intervento adesivo (1991), Gestri, Rivista di dirittointernazionale(1999),5andss.,Byers,McGillLawJournal(2002),389andss.

13

is not to offer new solutions, but only to provide the reader with the state of artregardingtheapplicabilityofthedoctrine.

Inconclusion,asof today, theavailable literatureon thesubject isverypoorandthereisalackofsolutionsfortheproblemofparallelproceedingsininvestmentarbitration.

***

Itisnecessaryformetothanksomepeoplethathavebeenessentialinwriting

this work. Thanks to Prof. Massimo Iovane, my firstmaestro and my professionalfather,forhavingbelievedinmesinceIwasanundergraduateattendingthecourseofinternational law. Thanks to my “older brother” Prof. Fulvio M. Palombino, that I“destroy”onadailybasiswiththousandsofquestionsandanxieties;hissuggestionsaremorethanprecious,bothfromthehumanandfromtheacademicside.ThankstoProf. Loukas A. Mistelis, who has accepted to supervise me notwithstanding thephysical distance between us. In every meeting between us, he let me feel thateverything, in life, is possible and this renders him a very special person for me.Thanksalso toDr.EduardoSavarese,whohas readtheworkandprovidedmewithprecious suggestions, andDr.DanieleAmoroso, for his spot – but very important -suggestions.

Finally,mybiggestthanksgoestomyfamilyandSonia,towhomthisworkisdedicated,forhavingsustainedmeintheseveralmomentIfeltdownduringthelastthreeyears.

14

SECTION1Theproblemofparallelproceedingsininternationalinvestmentarbitration:thenecessity

forasolutionbeyondpartyautonomy

IntroductionParallelproceedingsasacrucialproblemofinvestmentarbitration

0.1 Thecriticismrelatingto investmentarbitration.Acritic tothecriticsand

the reaffirmation of arbitration as the preferred form of investmentdisputesettlement.

Inrecenttimesinvestmentarbitrationhasattractedseverecriticisms1and,asa

consequence, the reactionsofmanyStatesagainst this formofdispute resolution.2Generally speaking, the wholemechanism has been considered non-respondent tothenecessitiesofaformofjusticethatinvolvesbydefinitionstrongfeaturesofpubliclaw adjudication, and arbitrators have been accused of pro-investors bias.3Thisintroductionwillmakeaverybriefanalysisofsuchcriticsandoftheanswersthathavebeen found for the majority of them. The results of this analysis will lead us tounderstand why it is today essential to find a solution to the problem of parallelproceedings in investment arbitration. As it will be seen below, indeed, it actuallyappears that parallel proceedings are the only completely unanswered problem ofinvestment arbitration. The research for a solution to parallel proceedings appearsthereforeessentialinordertostopthecriticsandconfermorelegitimacytosuchformofdisputeresolution.

Starting from the assumption that investment arbitration is a formof publicadjudication, investment arbitration has been subject to four main critics. Inparticular, according to Gus Van Harten, a dispute resolution mechanism shouldsatisfy four main requirements: independence, openness, accountability and

1SeePerry(2014),reportingadebateregardingthevarious issuesconcerninginvestmentarbitration.SeealsoWaibel,Kaushal,ChungandBalchin(2010),1andss.,andCampbell,Nappert,Nottage(2013),iandss..SeealsoSornarajah,AppealsMechanismin International InvestmentDisputes(2008),55andss.,whohasstrictlyrelatedthelegitimacycrisisofinternationalinvestmentlaw–thatwillbediscussedinparagraph1.5.1below–totheexpansiveapproachofinternationalinvestmenttribunals.2Bolivia,EcuadorandVenezuelahavewithdrawnfromtheICSIDConventionandterminatedmanyoftheir BITs. Australia has declared that it will stop including provisions setting forth investmentarbitration in its investment treaties,while Indonesia has terminated some of its BITs. According toCosmas, International Journal of Scientific and Research Publications (2013), 2 and ss., also SouthAfrica, Zimbabwe, Liberia, Russia, Thailand, Senegal, Kyrgyzstan and Germany have showndissatisfactionwithinvestmentarbitration.3VanHarten,InvestmentTreatyArbitrationandPublicLaw(2007),152andss.SeealsoCosmas,(2013),(n. 2), 1-3 who referred to inconsistent decisions, lack of transparency, lack of impartiality andindependence,lackofanappealmechanismandveryhighcosts.

15

coherence.4In the opinion of such Author none of the mentioned requirements iscurrentlysatisfiedbyinvestmentarbitration.

Withregardtothefirstofsuchrequirements,itisarguedthatarbitratorslackindependence because they depend from appointing authorities and prospectiveclaimants and therefore they act in order to appease such people. Concerningopenness,VanHartenhasstatedthatthepublicdoesnothaveaccesstoinformationaboutadjudicativedecision-making.Accountabilityisallegedlylackingbecausetherearenoappealmethodsinordertorenderaccountablethepublicfortheinterpretationofpubliclaw(i.e. internationalinvestmentlaw).Finallytheincapabilityofarbitratorsto resolve inconsistencies arising from conflicting decisions generates the lack ofcoherenceof investmentarbitration. In conclusion, themechanismof settlementofinvestment disputes should be reformed through: (i) the provision of an increaseddomestic scrutiny of arbitral awards;5(ii) the creation of a permanent internationalinvestment court. 6 Starting from Van Harten’s critics, a long debate on theappropriateness of investment arbitration to solve disputes between States andinvestorshastakenplace.ThelastepisodeofthissagahasbeentheissuancebytheEuropeanFederationforInvestmentLawandArbitration(EFILA)of“AresponsetothecriticismagainstISDS”,7whereanattempttoreplytosomeofsuchcriticismhasbeenmade. As it will be seen below, such attempt may be considered successful withregard to all the critics that havebeenmoved to investment arbitration, unless theoneregardinginconsistencyandincoherenceofinvestmentarbitration.

Prior to move to an analysis of the abovementioned criticisms, it is worthnotingthattheseproblemshavearisenveryrecently.Indeed,hasithasbeenrecentlynoted,“asystem[i.e.investmentarbitration],workingquietlyinthebackgroundandvirtuallyunknowntothoseoutsidethisfieldfifteenyearsago,hasgarneredinfluence,developed internal contradictions and attracted political vitriol that threatens todestroy it”.8In the opinion of the present author, in fact, many of the criticismsdirected to investment arbitration depend on the fact that certain rules ofinternationalcommercialarbitration(e.g.confidentiality)havebeenoftenappliedtoinvestment disputes, disregarding the circumstance that investment arbitrationpresents many differences from the classical private international commercialdisputes. Investment arbitration, indeed, involves the participation of a State and,

4VanHarten(2007)(n.3),152andss.SeealsoD’Agostino,VirginiaLawReview(2012),203andss.,whohas talkedabout sevenmainproblemsof themechanism,namely: (i) endless chainof claimants; (ii)multiplerecovery;(iii)multiplevenuesandforumshopping;(iv)inconsistentresults;(v)equallyworthynon-partiesrecoveringnothing;(vi)localinvestors’treatmentdiffersfromthatofforeigninvestors;and(vii) no closure. Such categories may be easily inserted in Van Harten’s broader classification. Inparticularpoints(i)to(iv)and(vii)maybeinvolvedinthelackofcoherence,point(v)and(vi)maybecategorizedasinvolvedinthelackofopennessandaccountability.5VanHarten(2007)(n.3),175andss.6Id.,180andss.7EFILA,AresponsetothecriticismagainstISDS(2015),1andss.8D’Agostino,(2012)(n.4),200.

16

therefore, considerations of public interest are at stake.9This circumstance rendersinappropriate a full reliance on the rules of a system of adjudication – such ascommercialarbitration–thatisprivateandconfidentialbydefinition.10Thisproblemhasclearlyemergedwiththerecentgrowthofthenumberofinternationalinvestmentdisputes.

However, it is also true that arbitrators and academics are gradually findinganswerstotheproblemsofinvestmentarbitrationthroughtheadaptationofexistingrules to the needs and features of such form of dispute settlement. The presentauthorsharestheviewofthosewhothinkthatinvestmentarbitrationisstillthebestmechanism for the settlementof investmentdisputes and that the solutions to thechallengesthat investmentarbitration is facingshallbefoundwithinthesame legalframeworkofinvestmentarbitration.11Thefollowingsub-paragraphswillbethereforeaimed at demonstrating that three of the four Van Harten’s critics, namelyindependence, openness and accountability, are ill founded in light of the recentevolutionof investmentarbitration.As itwillbeseen in theparagraph1.4, theonlytrue critical point of themechanism is the lack of coherence generated by parallelproceedings.Therestofthebookwillbeaimedatfindingasolutionforthisissue.

0.1.1 Independence

Starting from the arbitrator’s alleged lack of independence, Van Harten hasstatedthatitis“themosttroublingissuethatarisesfromtheuseofprivatearbitrationtoresolveregulatorydisputes”.12Asalreadysaid,thisisallegedlyduetothefactthatarbitrators are appointed on a case-by-case basis; from this circumstance it shouldthereforederivethatarbitratorsare,bydefinition,pro-investorsbiasedbecausetheywouldbewillingtogetnewappointments.

InthisregarditshouldbefirstofallnotedthatVanHarten’sstatement“isnotsupported by any empirical evidence”. 13 On the contrary, evidence shows thatrespondent States win themajority of investment disputes.14Perhaps critics of the

9Mistelis,ArbitrationInternational(2005),211.Forananalysisofthedifferencesbetweencommercialand investment arbitration see Bockstiegel, Arbitration International (2012), 577 and ss. The Authorfocuses on the following elements of difference: (i) interests at stake; (ii) legal framework andapplicable law; (iii) arbitrators (selection and challenge); (iv) jurisdiction; (v) case management; (vi)confidentialityandtransparency;and(vii)predictabilityofdecisions.10Mistelis,(2005)(n.9),211.11Spoorenberg, Vinuales, The Law and Practice of International Courts and Tribunals (2009), 91.Boddicker,AmericanUniversityInternationalLawReview(2010),1070.ThisAuthor,speakingabouttheimpossibilityofaglobalreformofinvestmentarbitration,hasfocusedonthenecessityofadaptingpre-existingrulestothefeaturesofinvestmentarbitration.12VanHarten(2007)(n.3),167.13Meyers, works.bepress.com/Daniel_meyers/2 (2008), 17. On the matter see also Schultz, Dupont,ssrn.com/abstract=2399179(2014),1andss.14EFILA (2015) (n. 7), 6 and ss. In this regard see also Franck, Harvard Journal of International Law(2009), 440, who stated that “there are reasons to be cautiously optimistic about the system ofinvestmenttreatyarbitrationanditsrelationshipwithdevelopmentvariables”.TheAuthor,at445andss.,hasempiricallydemonstratedthatthesystemisnotbiasedagainstdevelopingcountries.

17

system are confusing the fact that Tribunals have assumed jurisdiction in the vastmajority of the cases (even if such cases, as it will be seen below, may appear asabusesof investmentarbitration)withapro-investorbias. Inthisregarditshouldbenoted,firstofall,that“thereisnocausallinkbetweenafindingofjurisdictionandanarbitral tribunal ultimately being pro-investor on the merits of the case”15and,secondly,that(asexplainedinparagraph1.2above)thesameStateshavegeneratedtheabovementionedpro-jurisdictionalapproachthroughverybroadclausesdefininginvestmentsandinvestorsinBITs.16

Moreover, even if one would accept Van Harten’s idea that investmentarbitrationTribunalsarepro-investorbiased,thisdoesnotmeanthatanotherforumwouldbe lessbiased. Inparticular, national courts (at least in several countries) arenot–intheopinionofthisauthor–betterpositionedinordertoissueadecisionthatisbydefinitionmorefairandneutralthantheoneissuedbyarbitrators.17Indeed“theproblemwithmoststatecourtsisthattheyarenot–oratleasttheyarenotperceivedtobe– sufficientlyneutral in resolvingdisputesbetween foreign investors andhoststates”,18nor“thecourtsofthirdstatesare…betterplacedtooffereffectivedisputesettlement between investors and host states”.19On the contrary, as we will seebelow,thepossiblerecoursetonationalcourtshasbeenusuallyperceivedasabarriertothedevelopmentofforeigninvestments.TheprotectionofinvestorsthroughBITsand investment arbitration has increased because “States realize[d] that bybroadening the scope of the protection of investors and investments they increasetheirchancestoattractFDI”.20

Finally,andmoreimportantly,itisworthmentioningthat–whileinthepast,inparticular in ICSIDarbitration, arbitrator’s independenceand impartialityhavebeenonly rarely considered lacking – today the situation has totally changed.21Indeed,while in thepast the requirementof independenceset forthbyArt. 14of the ICSIDConvention 22 has been interpreted as requiring an effective manifest lack of

15EFILA(2015)(n.7),11-12.16Id.,8andss.17In this regard it should insteadbe considered that arbitrators have an interest in issuing a fair andneutralawardconsideringthattheyhavetheirownreputationtoprotect.SeeMeyers(2008)(n.13),14.18Brower,Schill,ChicagoJournalofInternationalLaw(2009),479.19Ibid.20EFILA(2015),(n.7),8.21See,interalia,Sheppard,inTheOxfordHandbookonInternationalInvestmentLaw(2008),131andss.,Bernasconi-Osterwalder, Johnson, Marshall (2010), 1 and ss., Giorgetti (2014), Horn, New YorkUniversityJournalofLawandBusiness(2014),349andss.,Karadelis(2014).22On the issue of disqualification, Article 57 of the ICSID Convention provides that “a party mayproposetoacommissionortribunalthedisqualificationofanyofitsmembersonaccountofanyfactindicatingamanifestlackofthequalitiesrequiredbyparagraph(1)ofArticle14.Apartytoarbitrationproceedingsmay, inaddition,proposethedisqualificationofanarbitratoronthegroundthathewasineligibleforappointmenttotheTribunal.’(Emphasisadded).Article 58 of ICSID Convention further provides that the decision to disqualify an arbitrator shall betaken by the othermembers of the tribunal, howeverwhere the disqualification proposal involves asolearbitratororamajorityofthem,orwheretheco-arbitratorcannotagree,theChairmanof ICSIDAdministrativeCouncilshoulddecide.

18

independenceand impartiality,23nowthethresholdhasbeen lowered:anappearanceof manifest lack is considered sufficient. 24 This circumstance renders the ICSIDthresholdmoresimilartotheonessetforthbytheUNCITRALRules25andbytheIBAGuidelinesonConflictsofInterestinInternationalArbitration,26whosethresholdwaslowerthantheoneestablishedbyICSIDTribunals.

0.1.2 Openness

23See,e.g.,Amcov.Indonesia,ICSIDCaseNo.ARB/81/1,DecisiononDisqualificationof24June1982,reported in Reisman, Craig, Park, Paulsson, International Commercial Arbitration (1997), 624-631,whereithasbeensaidthatthemerefeelingof“nonreliability”doesnotsuffice,UniversalCompressionv.Venezuela,ICSIDCaseNo.ARB/10/9,DecisionontheProposaltoDisqualifyProf.BrigitteSternandProf. Guido Santiago Tawil, Arbitrators, 20 May 2011, and Suez, Sociedad General de Aguas deBarcelonaS.A.,andVivendiUniversalS.A.v.ArgentinaICSIDCaseNo.ARB/03/19,DecisiononaSecondProposalfortheDisqualificationofaMemberoftheArbitralTribunal,12May2008.24See Burlington Resources Inc. v. Republic of Ecuador, ICSID Case No. ARB/08/5, Decision on theProposal for Disqualification of Professor Francisco Orrego Vicuna, 13 December 2013, Blue BankInternational & Trust (Barbados) Ltd. v. Bolivarian Republic of Venezuela, ICSID Case No. ARB/12/20,Decision on the Parties’ Proposal to Disqualify a Majority of the Tribunal, 12 November 2013, and,finally,CaratubeInternationalOilCompanyLLP&MrDevincciSalahHouraniv.RepublicofKazakhstan,ICSIDCaseNo.ARB/13/13,DecisionontheProposalforDisqualificationofMr.BrunoBoesch,20March2014,thathasbeenthefirstICSIDcaseinwhichthedisqualificationofanarbitratorhasbeendecidedbythetwootherpanellists.25Under theUNCITRAL Rules, Articles 11-13 dealwith the disclosure obligation and challenge of anarbitrator.Article 11 requires the arbitratorwhenapproached for a possible appointment todiscloseanycircumstance likelytogiveriseto justifiabledoubtsastohisorher impartialityor independence.Theobligation todisclose to thepartiesandtheotherarbitrators isacontinuingonewhich is to lastthroughout the arbitration proceeding. Article 12, inter alia, provides that “an arbitrator may bechallenged,ifcircumstanceexistthatgiverisetojustifiabledoubtsastothearbitrator’simpartialityorindependence.”Further,Article12(3)providesthatanarbitratorthatfailstoact,orintheeventofthede jure or de facto impossibility of performing his or her function, the procedure in respect to thechallengeofanarbitratorcontainedinArticle13shallapply.Article13providesforthetimelinewithinwhichanoticeofchallengetotheappointmentofanarbitratoristobemade.Itfurtherprovidesthatwhenthisnoticeismade,allthepartiesmayagreetothechallengeandconsequentiallythearbitratormaywithdrawfromhisorheroffice.Itishoweverprovidedthatthisisnottoimplyacceptanceofthevalidityofthegroundsofchallenge.26Under the general standard regarding impartiality, independence and disclosure, the IBA GeneralPrinciplestipulatesthat“everyarbitratorshallbeimpartialandindependentofthepartiesatthetimeofacceptinganappointmenttoserveandshallremainsoduringtheentirearbitrationproceedinguntila final award has been rendered or the proceeding has otherwise finally terminated.” The GeneralStandard2(a)providesthat,“anarbitratorshalldeclinetoacceptanappointmentor,ifthearbitrationha[s]alreadycommenced,refusetocontinuetoactasanarbitratorifheorshehasanydoubtsastohisorherabilitytobeimpartialorindependent.”���GeneralStandard2(b)stipulatesthat“thesameprincipleappliesiffactsorcircumstanceexist,orhavearisensincetheappointment,thatfromareasonablethirdperson[’s]pointofviewhavingknowledgeoftherelevantfacts,giveriseto justifiabledoubtsastothearbitrator’s impartialityor independence,unlessthepartieshaveacceptedthearbitratorinaccordancewiththerequirementsetoutinGeneralStandard(4)”(emphasisadded).GeneralStandard2(c)explainsthat doubts are justifiable if a reasonable and informed third partywould reach the conclusion thattherewasalikelihoodthatthearbitratormaybeinfluencedbyfactorsotherthanthemeritofthecaseaspresentedbythepartiesinreachinghisorherdecision.FurtherGeneralStandard2(d)clarifiesthatjustifiable doubts necessarily exist as to the arbitrator’s impartiality or independence if there is anidentitybetweenapartyandthearbitrator; if thearbitrator isa legal representativeofa legalentitythatisapartyinthearbitration,orifthearbitratorhasasignificantfinancialorpersonalinterestinthematteratstake.

19

Thesecondcriticismthathasbeenmovedto investmentarbitration isthat itprohibits that the public has “access to information about adjudicative decisionmaking” 27 and therefore it is not transparent. As a consequence investmentarbitration is “immune frompublic scrutiny and [this causes that]matters affectingthecommunityatlargecouldberoutinelydecidedinsecret”.28

This criticism does not keep into account the current strong tendency ofinvestment arbitration towards transparency.29 This is manifested by two mainelements,namely,thepublicationoftheawards,andtheamicicuriae’sinvolvementintheproceedings.

Themovement towards transparency has culminated in the adoption of the2014 UNCITRAL Rules on Transparency and the publication in 2015 of the UnitedNations Convention on Transparency in Treaty-based Investor-State Arbitration(providing,atcertainconditions,fortheautomaticapplicationoftheUNCITRALRulesonTransparency).30AccordingtotheUNCITRALrulesthevastmajorityofinformationregardingan investmentarbitrationcasewillbepubliclyavailableandelectronicallystored.31TheUNCITRALRulesonTransparencyhavebeenalreadyadopted,interalia,byArt.X.33ofthenegotiatedtextoftheEUCanadaFreeTradeAgreement(i.e.theComprehensiveTradeandEconomicAgreement(CETA)).32

Generally speaking, the fact that investment disputes involve States andgeneralpublic interesthasshifted“theemphasis fromprivacyandconfidentialitytoknowledge and accountability. Knowledge implies the use of specialist expertise inthe form of amicus briefs and consequently limited confidentiality, whileaccountability more or less mandates the publication of awards and arbitration ateventheinterimstagesofprocedure”.33Itcanbethereforesharedtheopinionofwhohasstatedthat,notwithstandingthefact that“the ICSIDConventionandmostBITssay little or nothing on whether the proceedings and awards shall be treated asconfidential… in practice, today, little confidentiality is left in investmentarbitration”. 34 This is considered to be “the most striking difference betweencommercialandinvestmentarbitration”.35

27VanHarten(2007)(n.3),159.28Ibid.,161.29See EFILA (2015) (n. 7), 14 and ss. In this regard it is alsoworth tomention the International LawInstitute,TokyoSession,Resolutionof13September2013,article6ofwhichrecognizestheimportanceoftransparencyandamicicuriaeininvestmentarbitration.30Opened for signature inPortLouis,Mauritius,on 17March2015, and thereafter atUnitedNationsHeadquarters inNewYorkbyany (a)State;or (b) regionaleconomic integrationorganization that isconstituted by States and is a contracting party to an investment treaty. At the present date theConventionhas16signatoryStates.31SeeWilkie,kluwerarbitrationblog.com(2013).32Availableathttp://trade.ec.europa.eu/doclib/docs/2014/september/tradoc_152806.pdf.33Mistelis(2005)(n.9),211.34Bockstiegel(2012)(n.9),586.35Ibid.,587.InthisregarditshouldbementionedArticle29oftheUSModelBITwhichimposethatallmemorials, minutes, orders, hearings and awards of the tribunal shall be open to the public. ThispracticeisquitedevelopedinNAFTAandCAFTAcountries.SeeEFILA(2015)(n.7),14-15.Withregard

20

In parallel to the fact that today the vastmajority of investment awards arepublic,36it shall be mentioned that today many “voluntary third parties seek toparticipate in a specific investment arbitration dispute in order to provide a neutraland a well supported opinion regarding an issue of public concern”.37Such thirdparties, usually NGOs, are known as amici curiae.38The involvement of amici ininvestmentarbitration–andinparticularindisputesregardingcommongoods–has“supported the development of transparency in investment arbitration, by enablingissues concerning general public interest to be considered within the arbitralprocess”.39

Inconclusionitcanbesaidthattherecentevolutionofinvestmentarbitrationcanbeconsideredasadefactoreplytocriticismrelatedtotheopennessofsuchformofdisputeresolution.40

0.1.3 AccountabilityWithregardtothisrequirement, it isarguedthatinvestmentarbitrationdoes

notallowapartytoappealanawardformattersregardinglegalinterpretationanditisthereforenotaccountabletothepublic.41

Concerning this aspect, the EFILA response limits itself to saying that“investmenttreatyarbitrationcontainsanumberofdifferentcontrolmechanismstoensureaccountability”.42Thepresentauthorsharessuchview;itishoweverworthtogiveabriefexplanationofthereasonsforwhichaccountabilityshallnotbeconsideredaproblemininvestmentarbitration.

First of all, as it hasbeennoted, all ICSIDarbitrations are subject to the selfcontained mechanism of review given by articles 50 and followings of the 1965WashingtonConvention,43whileadhoc arbitrationsare still subject to challengesatthe courts of the seat and to the provision of article V of the 1958 New YorkConvention,concerningtherefusaltoenforceaninternationalarbitrationaward.

tothe issueofconfidentiality,seeBywaterGauff (Tanzania)Ltd.v.UnitedRepublicofTanzania, ICSIDCaseNo.ARB/05/22,ProceduralOrderNo.3,29September2006.36SeeMistelis(2005)(n.9),218,EFILA(2015)(n.7),16.37EFILA(2015)(n.7),15.38SeeMistelis (2005) (n.9),220andss.,Bastin,CambridgeJournalof InternationalandComparativeLaw(2012),208andss.,FachGomez,FordhamInternationalLawJournal(2012),510andss.Asarbitralawards regarding the amicus curiae figure, see Bywater Gauff (Tanzania) Ltd. v. United Republic ofTanzania,ICSIDCaseNo.ARB/05/22,ProceduralOrderNo.5,2February2007,Suez,SociedadGeneraldeAguasdeBarcelonaS.A.,andVivendiUniversalS.A.v.ArgentinaICSIDCaseNo.ARB/03/19,OrderinResponsetoaPetitionforTransparencyandParticipationasAmicusCuriae,19May2005.39EFILA(2015)(n.7),16.40For an opinion against transparency in arbitration see Sabater, Berkeley Journal Int’l L. Publicist(2010),47andss.41VanHarten(2007) (n.3),154.Problemsrelatedtothecontrolmechanisminthe ICSIDsystemhavebeenanalysedbyReisman,DukeLawJournal(1990),740andss.42EFILA(2015)(n.7),14.43SeeMeyers(2008)(n.13),14.

21

Secondly,“thepotentialforerrorsoflawis,toacertaindegree,minimizedbythespecialconcernthatarbitratorsintheITAsystem–asopposedtotenuredjudges–havetheirownreputation”44tobeprotected.

Finally,andmostimportantly,thosewhocriticizethelackofaccountabilityofinvestment arbitration seem to forget that – when the parties choose to refer toarbitrationingeneralandtoinvestmentarbitrationinparticular–theyareoptingfora one-stop adjudication. In transnational commerce (and, therefore, also ininvestment disputes) parties are commercial people, wanting only one means ofdispute resolution.45When referring to arbitration, parties are looking for a neutral,effectiveandextremelyqualifiedmeansofdisputeresolution,withouthavingregardto the future involvement of national courts and to the possibility of rendering thepublic accountable of the dispute (that is anyway ensured by the growingtransparencyin investmentarbitrationanalysedinparagraph1.3.2above).This is, ineffect,whatinvestmentarbitrationgrantstotheparties.

0.2 Systemic features in investment arbitration: a network needing internal

coherenceThe fourth criticism that is moved to investment arbitration is most strictly

related to the issueofparallel proceedings. It is indeedargued that investment lawand arbitration lack internal coherence and consistency, i.e. the “capability of anadjudicativesystemtoresolveinconsistenciesthatarisefromdifferentdecisions,andtoensurethatthelawisinterpretedinauniformandrelativelypredictablemannertoallowthoseaffectedbytherulestoplantheirconduct”.46

Intheopinionofthepresentauthor,priortotalkaboutalackofcoherenceandconsistency,oneshouldascertainwhether,ininvestmentarbitration,acertaindegreeoforderlinessisrequiredandthereforeifcoherenceandconsistencyshallbeensured.Infact,ifitisascertainedthatsystemicfeatures-evenifatanembryonicstatus-arelacking, investment arbitration tribunals will appear (and, actually, shall beconsidered) only as unrelated entities which move in different directions withoutcaring of each other and not needing any sort of interaction. It will be thereforeuselesstosearchforwaysforensuringconsistencybetweenarbitralawardsbymeansofaneffectivemanagementofparallelproceedingsininvestmentarbitration.

44Ibid.45InthisregardseeSulamericaCIANacionaldeSegurosSAv.EnessaEngenhariaSA, ILloyd’sRep275(2012). See also Fiona Trust v. Privalov, UKHL 40 (2007), where it has been said that there exist apresumption in favour of a one-stop arbitration. The House of Lords excluded the possibility that acommercialpartywouldcreateasysteminvolvingvariousstepsforthesamedispute.46VanHarten(2007)(n.3),164.ThesameAuthor,at165,hasexplainedthatthisproblemisnotlimitedtoinvestmenttreatyarbitration,butregardsinternationallawingeneral.Accordingtoitscritic“attheinternationallevel,thechallengeofcoherenceconfrontsalltreaty-basedadjudication”,becausethereisnohierarchicalstructureandthereforeininternationalinvestmentarbitrationapointofsynthesisislacking.

22

Asapreliminaryremark,itshallbenotedthatthereisnoagreementevenonthedefinitionofa legal system.47It is thereforepossible that investmentarbitrationmightbeconsideredasasystemaccordingtocertaindefinitionsbutnotaccordingtoother definitions. In light of this consideration (and of the circumstance that thepresentbook isnotastudyon legal theory),wewillnotgivehereanansweronthequestion whether international investment arbitration is a system. The presentparagraphwillonlytrytoascertaintheexistenceofsystemic features in investmentarbitration,inordertodetermine–ifsuchfeatureswillbefound–whetheracertaindegree of coherence and consistency between investment arbitration awards isrequired and therefore if a solution to the problem of parallel proceedings isnecessary.

Forreasonsofsimplicitywewilladoptasaparameteronlyonedefinitionfortheword“system”,whichseemstobebroadenoughtoconstituteapointofreferencefor the present research. According to Yuval Shany, “a system can be defined as apurposeful arrangement or constellation of inter-related elements or components,which cannot accurately be described and understood in isolation from oneanother”.48Inthisregard,itshallbehighlightedthattheword“system”isveryoftenusedimproperlywithregardtointernationalinvestmentlaw:ratherthanusingitwiththemeaningindicatedabove,severalAuthorstalkabout“theinvestmentarbitrationsystem” or the “ISDS system” just referring to this kind of dispute resolution,regardless of an analysis of whether actually there are systemic features ininternationalinvestmentlawandarbitration.Thecommonreferraltheword“system”thatmanyAuthorsmake,therefore,isnotanindicationoftheexistenceofasysteminitspropermeaning.

Several scholars have tried to understand if investment arbitration may bequalifiedasasystem.49SomeAuthorshaveexpressedtheopinionthat internationalinvestment law is a system,50 others have declared that it is a sub-system ofinternationallaw,51andothershavestatedthatthereisnosystematall.52

47Shany, The Competing Jurisdictions of International Courts and Tribunals (2003), 87 and ss., hasexamined the theoriesof several veryauthoritative scholars, suchasHart,Kelsen,Raz,RomanoandAbi-Saab.ThereferencegoestoHart,TheConceptofLaw(1994),Kelsen,IntroductiontotheProblemofLegal Theory (1934), Raz,A Concept of a Legal System, Romano,L’ordinamento giuridico (1917), Abi-Saab,RecueildesCours(1996).48Ibid.,87.49Thequestionhasarisenalsowithregardtointernationallaw.InthisregardseeShany(2003)(n.47),87 and ss., who has concluded for the orderliness of international law notwithstanding thefragmentation of the judiciary, andAbi Saab,NewYorkUniversity Journal of International Law andPolitics (2009) 921 and 924. This Author argues that “we do not seem to have a ‘judicial system’,properlyso-calledininternationallaw”butthat“itistruethatoccasionallysomevaguelineamentsofastructurebecomeperceptible”.SeealsoT.Franck,TheAmericanJournalof InternationalLaw(1988),705andss.,Kumm,EuropeanJournalofInternationalLaw(2004),907andss.50Schill, Virginia Journal of International Law (2011), 94, stated that “there are several factorssuggestingthatinternationalinvestmenttreatiesarenotbilateraltreatiesinthesenseofquidproquobargains between two countries, but rather form part of a treaty-overarching system of investmentprotection – in otherwords, a framework that ismultilateral in nature even though it has taken theformofbilateraltreaties”.ThesameAuthor,intheInauguralConferenceoftheSocietyofInternational

23

The starting point for the discussion is the fact that arbitral tribunal areconstitutedonanadhocbasis.Ifthisistrue,asamatterofprinciple,theirtaskshouldbe only to resolve the dispute at hand,without caring about the decisions of otherTribunals, even though on the same matter.53This explains why an authoritativescholarsaidthat“ininternationallaw,everytribunalisaself-containedsystem(unlessotherwise provided). Consequently there are no general rules by which to sortquestionsofcoordinationandconflict.Thesesquestionsaretobesolvedwithineach‘selfcontainedsystem’–inotherwords,withinthecontextoftheinternationalcourtor tribunal in which the case has been brought”.54The circumstance that everytribunalisconstitutedadhocisthereforethefirstargumentagainsttheexistenceofasystem.55

The second argument against the possible existence of a system is the factthat international investments are today regulated by a “chaotic and unsystematicaggregate”56ofBilateral InvestmentTreaties. “Rather thanconstitutingaconsistent

EconomicLaw(2008),3,hastalkedabouta“trulymultilateralsystem”and,inTheMultilateralizationofInternational Investment Law (2009), 278, of an “autopoietic, self referential and normatively closedsystemof law,thatoverarchesthemyriadofbilateral investmenttreatyrelations,unitesthemundercommonprinciples governing international investment relations and contributes toproviding a legalframework for the functioning of the global economic system”. See also Salacuse, in MakingTransnationalLawWorkintheGlobalEconomy(2010),430,whohastalkedabouta“regime”.Finally,seeAlvarez,RecueildesCours(2009),193-544andHansen,ModernLawReview(2010),526-527. It isworthnotingthatMcLachlan,LisPendensinInternationalLitigation (2009),75,hasgoneevenfurther,stating “it isprobablyno longeranexaggeration to say that internationalcommercial arbitrationhasbecome itsown legal system” (emphasisadded).Thispositionseemstobeunacceptable,dueto thelackofanysystemicfeatureincommercialarbitration.51Savarese, La nozione di giurisdizione nel sistema ICSID (2012), 233, Di Benedetto, InternationalInvestmentLawandtheEnvironment(2013),22andss.seemstoespousethissecondtheory.Thislastauthor, at 43, criticizes Schill’s position saying that “the thesis claiming that investment rules havealready been harmonized and multilateralized would appear to be somewhat premature (…) [and]would risk fostering a view of this subsystem of law as being detached from international law as awhole,andwouldthusultimatelyleadtocharacterizinginternationalinvestmentlawandarbitrationasa self-contained regime”. Finally, at 42, Di Benedetto says that Schill “underlined the fact thatinvestment tribunals have frequently referred to past decisions and awards, each of them usuallyapplyingdifferentIIAs,butdisregardstheirequallyimportanttendencytorefertothecaselawofnon-investmenttribunalsandcourts.OnthislastsubjectseePellet,ICSIDReviewFILJ(2013),223andss.52Vadi,ManchesterJournalofInternationalEconomicLaw(2011),24.53DiBenedetto(2013)(n.51),22-23,talksabouta“patchwork”of“amultiplicityofautonomouslegalinstruments and, by the same token, the settlement of investment disputes by independentinvestmenttribunals”.Forthisreason“rulesorprinciplesbelongingtodifferentregimesmayapplytothesamematterinapotentiallyconflictingway”.54Treves,NewYorkUniversityJournalofInternationalLawandPolitics(1999),809.55Savarese(2012)(n.51),232.Shany(2003)(n.47),86, Inthisregardhasstatedthat“it ispossibletoimagine a body of normswhich constitutes a coherent legal system but is being applied by judicialbodies that do not form a meaningful judicial system. Hence, the existence of a halfway model,whereby judicial bodies are only loosely related to each other, mainly through their reference to acommonnormativesystem,mustalsobeexplored”.Inthisregard,notethatMcLachlan,LisPendensinInternationalLitigation(2010),254,hasstatedthat“inpublicinternationallawitispossibletotakeasapoint of departure the proposition that, however disparatemay the jurisdictions of particular courtsandtribunals,theyallultimatelyowetheirorigintoasinglelegalsystem.Theyarecreaturesoftreaty.Treatiesonlygaintheirforcebyvirtueoftheexistenceofagenerallegalsystem”.56Schill,www.ssrn.com/link/SIEL-Inaugural-Conference.html(2008),2.

24

andcoherentsystemoflaw,onewould[therefore]expectanextremedivergenceandfragmentationinthisareaofinternationalcooperation”.57

However,eveniftheaboveargumentsarewellfoundedandreflectpartoftherealitywith regard to the lack of orderliness in investment law and arbitration, it isalso true that thereareother characteristicsof thisareaof international law,whichcanbeproperlyseenassystemicfeatures.Thereferencegoes,inparticular,to:(i)thestrict correlation (that may be often equalized to a complete overlap) existingbetween the standards contained in almost all existing BITs; and (ii) the so-called“taking intoaccountapproach”with regard to the issueofprecedent in investmentarbitration.

Withregardtothefirstaspect,itisworthmentioningthat“thesetreaties[i.e.BITs] containawidevarietyofoftenbroadlyworded,cross-referencingprovisions–making for a ‘spaghetti bowl’ of investment agreements imposing overlappingobligationsfromwhichitisdifficulttodistilclear-cutrulesforapplicationinindividualcases”.58In fact, “what one can observe is a convergence, not a divergence instructure, scope and content of existing investment treaties. Unlike genuinelybilateral treaties, BITs do not stand isolated in governing the relation between twoStates: they rather develop multiple overlaps and structural interconnections thatcreate a relatively uniform and treaty-overarching regime for internationalinvestments” (emphasis added).59It is in fact true that some BIT provisions andstandardsofprotection,suchasthefairandequitabletreatment,themostfavourednation,thefullprotectionandsecurityandthearbitrationclausearepresentinalmostallBITsandtheycannotbeseeninisolationfromeachother.Moreover,thewordingofsuchclausesisusuallyverysimpleandbroad,sothattherealcontentofthevariousstandards has been determined by the case law and the interpretation by arbitraltribunals.Itisthereforeworthsharingtheopinionofwhohasstatedthat“investmenttreaties are a ‘network’ of inter-related provisions, notwithstanding the formalautonomy of each treaty with respect to the other treaties. Such inter-relation isrealized through two phenomena. On one side investment treaties are based on astructure and on clauses, which are repeated in all treatieswith very similar, if notidentical,modalities.Ontheotherside,bymeansofthemostfavourednationclause,severalstructuralandnotoccasionalrecallsoperatebetweenthevarioustreaties,sothatinvestorsmayrelyonuniformstandardsofprotection”(emphasisadded).60

57Ibid.58Bekker,HarvardJournalofInternationalLawOnline(2013),5.59Schill(2008)(n.56),3.60Savarese (2012) (n. 51), 26. The concept of network has been used also by Franck, Fordham LawReview(2005),1523and1546,bySalacuse,inAppealsMechanisminInternationalInvestmentDisputes(2008), 7 and –with particular emphasis – byGeiger,AppealsMechanism in International InvestmentDisputes(2008),18andss.ThisAuthorhasdemonstratedthatthereisacertaindegreeofconvergenceininvestmentprotectionprovisionsandthat“investmenttreatiesprovideastrongsignalthatinvestorscanrelyontheexistenceofinternationallawobligations.Onthemeaningofthemostfavourednationclause see Faya-Rodriguez, Joubin-Bret, UNCTAD Series on Issues in International InvestmentAgreementsII(2010),1andss.,Parker,TheArbitrationBrief(2012),30andss.,Houde,OECDPaperson

25

Regardingtheexistenceofasystemofprecedentin international investmentarbitration, it is worth noting that this is one of the recently most debated issuesregarding this form of dispute settlement. In order to discuss about precedent inarbitrationitisworthmakingapreliminaryreferencetotherecoursetoprecedentinnational lawsystems.Usually the referral to “precedent” is intendedasa referral tothecommonlawdoctrineofstaredecisis,i.e.“theobligationtofollowpriordecisionseven those the judge disagrees with”. 61 Civil law countries, on the contrary,historicallyhavenothadastrongdoctrineofprecedentandhavemainlyfocusedontheconceptof“jurisprudenceconstante”.Accordingtothistheory,thestartingpointfor a judge in making a decision shall be the codified law; “secondarily, but notinsignificantly, tribunals would next turn to the decisions of other tribunalsconsideringidenticalorsimilartreatylanguage”.62Hence,incommonlawjurisdictionsprecedents should have binding force,while in civil law countries they should haveonly a persuasive authority. In this regard it should be noted thatwe are currentlyassisting toaprogressive convergenceof the commonandcivil law systems.63As ithasbeennoted“commonlawcountriesrenouncedtoaveryrigidideaofprecedent,while, symmetrically, civil law jurisdictions have developed a less reductive idea ofit”.64Whatisthereforeemergingfromananalysisofnationallawsystemsisadutyforjudgestoconsiderprecedents,knownas“takingintoaccountapproach”.

Furthermore, two other clarifications are required. First of all, whenwe talkabout precedent in investment arbitration we refer to horizontal stare decisis. Thismeans thatwearenotconsideringahierarchical relationshipbetween internationalcourts and tribunals and the consequent duty to follow the decisions of thehierarchically higher one, but only a horizontal relationship in which courts andtribunalsfollowtheratiodecidendiofeachotherduetothesimilarityoftheissuesathand.65Furthermore, we are not referring to a form of de jure stare decisis (i.e.

InternationalInvestment(2004),1andss.,Fietta,InternationalArbitrationLawReview(2005),131andss.MFN treatment in IIAs ismeant to ensure an equality of competitive conditions between foreigninvestorsofdifferentnationalities seeking to setupan investmentoroperating that investment inahostcountry.ThepresenceofsuchaclauseinaBITensuresthatthehostStatewillguaranteetothenationals of the other contracting State the best treatment that it assures to foreign investorsaccordingtootherinvestmenttreaties.61Zekos, Journal of World Investment and Trade (2009), 482; this Author carries out an historicalanalysis of the doctrine of precedent. In this regard see also de Prada Rodriguez, Munoz Rojo, Elprocesocivilinglés(2014),5andss.,Taruffo,Precedenteegiurisprudenza(2007),1andss.Thedefinitioncomes from the Latin “stare decisis et non quieta movere”, meaning “to stand by and adhere todecisionsandnotdisturbwhatissettled”.SeeVadi,TransnationalDisputeManagement(2008),2.62Bjorklund,TransnationalDisputeManagement(2010),272.63Palombino,Gli effetti della sentenza internazionale nei giudizi interni (2008), 3-4. See also Taruffo,RevistadaFaculdadedeDireitodaUFPR(2001),27andss.64Palombino, Il trattamento giusto ed equo degli investmenti stranieri (2012), 175 and ss. The Authormakes reference toaPracticeStatement issuedby theHouseofLords in1966, (1966)1W.L.R.1234(Eng),accordingtowhicharigidadherencetoprecedentsmayleadtoinjustice.Thereforeprecedentsshallbealwaysconsideredbutmaybedisregardedwhenconcreteneedssorequire.Withregardtocivillawcountries,a referenceshallbemadetoart.477,par.3,of theSpanishLeydeEnjuiciamentoCivil(2000)andtoart.65oftheItalianLawonjudicialorganization(RegioDecreton.12of1941).65SeeHaynes,JournalofInternationalDisputeSettlement(2014),501.

26

mandatedby law)but toade facto formof it.Thismeans thatcourtsand tribunalstakeintoaccounteachother’sdecisiondueto“acomplexmixofquasi-legalfactors–thatincludethehabit-orcustomarypractice-oftheadjudicator,theexpectationsoftheparties involvedinthedispute,theneedforefficiencyindisputeresolution–i.e.avoidance of ‘reinventing thewheel’ – an overall sense of fairness embodied in theprinciplethat likecasesshouldbetreatedalike,andthewidespreadopinionof legalandnon-legalscholarsandpractitioners”.66

Severalinternationalcourtsandtribunalshavefollowedahorizontal,defacto,takingintoaccountapproach.67InthisregarditisworthmentioningtheICJ’sdecisionin theCameroonv.Nigeria case,68where ithasbeensaid that–even ifaccording toarticle59oftheICJStatutetheeffectsofanawardshouldregardonlythepartiesinthedispute – any changeof approachof theCourtwith regard to similar questionsshallbeadequatelymotivated.69

Giventheabove,itisnowtimetounderstandwhathasbeentheapproachofinternationalinvestmenttribunalsandscholarswithregardtotheissueofprecedent.In this regard it isworth noting that – as a preliminary (and general) remark – twocommon statements are commonly made by scholars with regard to arbitralprecedent:70(i) in investment arbitration, arbitrators are (at least in principle) notboundbyany systemofprecedent;but (ii) ade facto, horizontal andverypowerfulsystemofprecedent“constrainsarbitratorstoaccountforpriorpublishedawardsandtostabilizeinternationalinvestmentlaw”.71Thisphenomenonisparticularlyrelatedtothe very strong doctrinal tendency to call for the application of precedents ininternationalinvestmentlaw.72

From the perspective of arbitral tribunals, the main reason for applyingprecedents has been described as the “natural desire of any court to maintainconsistency in theapplicationof law”.73Precedenthas thereforebeenconsideredas

66Bhala,AmericanUniversityInternationalLawReview(1998),938-939.SeealsoHaynes(2014)(n.65),502.67The problem of precedent in international law has been dealt with by Miller, Leiden Journal ofInternationalLaw(2002),489andss.TheAuthor,at498,hasconcludedthat“itshouldbeclear…thatinternationaltribunalsdo interactwithoneanother, ifnotattherobust level found indomestic legalsystems.Eachofthetribunalsunderconsiderationhasreferredtothejurisprudenceofanother”.InthisregardCassese,Diritto Internazionale(2006),277,hasnotedthat“duetotherudimentalcharacterofinternational law,tothe lackofacentralnormativeauthorityandofa judicial institutionhavingfinalandbinding jurisdiction,awards issuedby themostauthoritative international tribunals (inparticularthe ICJ) will have a crucial importance in the evaluation of the existence of customary rules, in thelimitationoftheirscopeofapplicationorapplicabilityandinthedevelopmentofnewdoctrines”.68SeePreliminaryDecisionof11June1998,par.28.69Palombino(2012)(n.64),184-187,hasdemonstratedthatsuchanapproachhasbeentakenalsobytheEuropeanCourtofHumanRightsandbytheCourtofJusticeoftheEuropeanUnion.70ForacontraryopinionseeBrower,Ottolenghi,inInternationalInvestmentLawforthe21stCentury:EssaysinHonourofChristophSchreuer(2009),851andss.71Cheng,TransnationalDisputeManagement(2008),1016.72See,inparticular,Kaufmann-Kohler,ArbitrationInternational(2007),357andss.73Brierly,inTheBasisofObligationinInternationalLaw(1958)29.

27

the “essence of the orderly administration of justice”.74Andres Rigo Sureda hasidentifiedother four reasonsforapplyingprecedents: (i) theparties’expectationstobetreatedinaccordancewiththeprincipleofequalitybeforethelaw;(ii)precedentsare repository of legal experience; (iii) to follow precedent is a way to avoid theappearanceofanyexcessofjudicialdiscretion;and(iv)judgesarereluctanttoadmitthat they were wrong. 75 Many other Authors have described the recourse toprecedent as a social practice, due to the fact that in the very small community ofinvestmentarbitratorsit iscommontokeepintoconsiderationtheotherarbitrators’decisions.76

Hence,fromapracticalperspective,arbitratorshaveusually:(1)identifiedpriorrelevant decisions; (2) compared the aggregate costs of departure from priordecisionswith the aggregate consequences of following prior decisions, taking intoaccountwhetherthepoliciesunderlyingthosepriordecisionsremainrelevantundercontemporaryconditions;(3)decidedwhichpriordecisionstofollowordepartfrom;and(4)articulatedreasonsfortheirdecision.77

Giventheabove,onthebasisoftheirapproachtoprecedent,arbitralawardshave been classified78in four categories: (a) arbitral awards which have consideredprecedents as persuasive authority;79(b) arbitral awards which have operated adistinguishing from precedents; 80 (c) arbitral awards which have consideredprecedentsasasupplementarymeansofinterpretationaccordingtoarticle32ofthe1969ViennaConventionontheLawofTreaties;81and(d)arbitralawardswhichhaveconsidered that to follow precedents is a duty due to the necessity to ensure theharmoniousdevelopmentofinternationalinvestmentlaw.82

In light of what has been said, in the opinion of the present author, theheterogeneityofarbitraldecisionsshowsthatthemostcorrectanalysiswithregardtothe existence of a doctrine of precedent in investment arbitration is the one thatsummarizes all the above approaches on the basis of the abovementioned “taking

74Lauterpacht,TheDevelopmentofInternationalLawbytheInternationalCourt(1958,reprinted2010),14.75Rigo Sureda, in International Investment Law for the 21st Century: Essays in Honour of ChristophSchreuer(2009),832-833.Purcell,CaliforniaLawReview(1997),869hastalkedaboutapublicfunctionofprecedents:“acorrectjudgmentshouldlogicallyinfluencethebehaviouroffuturelitigantsandguidethedecisionsoffuturecourts”.76See Hirsch, The Hebrew University of Jerusalem Research Paper No. 13-13 (2013), 20 and ss.,Weidemaier,WilliamandMaryLawReview(2010),1900.77Cheng(2008)(n71),1031.78RigoSureda(2009)(n.75),836.79Liberian Eastern Timber Corporation (LETCO) v. The Republic of Liberia, ICSID Case No. ARB/83/2,Award,31March1986.80RosInvestCoUKLtdv.TheRussianFederation,SCCCaseNo.Arb.V079/2005,AwardonJurisdiction,October2007,para.37.81CanadianCattlemenforFairTradev.UnitedStates,NAFTA,AwardonJurisdiction,28January2008,para.50.82See Saipem S.p.A. v. The People’s Republic of Bangladesh, ICSID Case No. ARB/05/7, Decision onJurisdiction, 21 March 2007, para. 57, and Bosh International, Inc and B&P Ltd Foreign InvestmentsEnterprisev.Ukraine,ICSIDCaseNo.ARB/08/11,Award,25October2012.

28

into account approach”.83This means that arbitrators cannot decide a case justignoring the previous awards that have analysed similar or connected issues.84ThishasbeenperfectlydemonstratedbytheempiricalanalysiscarriedoutbyCommission,according towhom the vastmajority of arbitral awards take into account previousdecisions.85

Given the above, it is possible to conclude that, as a matter of fact, whenanalysingthecurrentframeworkof international investment lawandarbitration,weareinfrontof:(1)anetworkofinterrelatedBITs;and(2)anetworkoftribunals,“whichactas if theyarepartofa single systemofdispute resolution” (emphasisadded).86Inthis regard, Joost Pauwelyn has talked about investment law and arbitration as a“complex adaptive system”, i.e. “a system in which large networks of componentswithnocentral controland simple rulesofoperationgive rise to complexcollectivebehaviour, sophisticated information processing, and adaptation via learning orevolution”.87Asaconsequence,accordingtoPauwelyn,foreigninvestmentlawhasa“minimumstructureofcontinuity(freeenoughtochange,butstableenoughtostayrecognizable),[and]itdistinguishesitselffrompurelychaoticsystems…whicharetoo

83Palombino (2012) (n. 64), 187 and ss. TheAuthor refers, in particular, to the casesEl Paso EnergyInternational Co. V. Argentina, ICSID Case No. ARB/03/15, Award, 31 October 2011, BP AmericanProductionCo.etal.V.Argentina,ICSIDCaseNo.ARB/04/8,DecisiononJurisdiction,27July2006,PanAmericaEnergyLLCandBPArgentinaExplorationCo.v.Argentina,ICSIDCaseNo.ARB/03/13,DecisiononPreliminaryObjections,27July2006.Similarly,Brown,TransnationalDisputeManagement(2008),3,hastalkedabouta“crossfertilization”betweeninvestmentarbitraltribunal.84 Schill (2008) (n. 56), 21, stated that “precedent has become both quantitatively as well asqualitativelythepremierdeterminantfortheoutcomeofinvestor-Statedisputes.Eventhougharbitralprecedent is considered to be non-binding, it has a considerable de facto force to the extent thatdivergences in investment jurisprudence become rather rare. Notably, even in cases of conflictingdecisions,tribunalsemployvariousstrategiestoupholdconsistencyininvestmenttreatyarbitration”.85Commission,JournalofInternationalArbitration(2007),129andss.Asaconfirmationoftheabove,wewillseethatonlyinthe(seeChapter1footnote198)NationalGasaward,thetribunalhastakenintoaccount other 17 arbitral awards. See also Castro de Figuereido, www.kluwerarbitrationblog.com(2014). With a more general perspective, Conforti, Rivista giuridica degli studenti dell’Università diMacerata(2010),24,statedthat,withthesakeofunderstandthecontentandmeaningofinternationalrules,itisessentialtostartfromtheactivitydone(andinterpretationgiven)byinternationalcourtsandtribunals(andinparticularoftheICJ).86Palombino (2012) (n. 64), 195. See also Kurtz (2013), 1, who has talked about a “diffuse andheterogeneousnetwork”.Inthisregard,notethat–talkingaboutgeneralinternationallaw–Bjorklund,Nappert (2011), 7,haveexposedtheir ideaofa “internucleicommunication”, “whereby internationaltribunals look to each other’s decisions, in appropriate cases, for influence and guidance in areas ofinternational law involvingsimilarconcepts”.This isa“wilfulawarenessbytribunals inonesphereofinternational law ofwhat goes on in other related spheres, and an exercise of canvassing the viewsexpressed by other tribunals in these related spheres for guidance to inform, or test, one’s ownanalysis. This is especially important for those areas of international lawwhich, like investment law,have not fullymatured”. This is also confirmed byDi Benedetto (2013) (n. 51), 127,who stated that“proof of the significant coherence of IIL [i.e. international investment law], despite the fact that itsmultiplesourcesare independentofeachother, isgivenbythecircularprocessexistingbetweentheinterpretations of authors or tribunals and the drafting techniques set out by investment treaties”.Dupuy,NewYorkUniversityJournalofInternationalLawandPolitics(1999),796,hasstronglycriticizedtheexistenceofsub-systemsininternationallaw.87Pauwelyn,http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2271869(2014),20.

29

volatileandrandomtosurvive”.88Intheopinionofthepresentauthor,however,suchsystemicfeaturescannotexistautonomouslybuthavealwaystobecollocatedwithinthe bigger framework of international law. This is testified both by the fact thatcertain substantive rules of international investment law originated in publicinternationallawandbythefactthatinternationalinvestmenttribunalsusuallymakereferencetopublicinternationallawrules(e.g.theViennaConventionontheLawofTreaties)andtothecaselawofpublicinternationallawcourtsandtribunals.89 Iftheaboveistrue,coherence,consistencyandfinalityarevaluesthatcannotbe ignored in a framework such as the one that has been just described.90It is anoxymoron, in fact, to talk about a network of treaties and tribunals, which,respectively,areinterpretedandoperatedisregardingeachother.Thiscircumstance,therefore,imposestofindasolutiontotheproblemofparallelproceedings. In this regard it is worth noting that, as of today, the issues of coherence,consistency,andfinalityofawardshavebeenoftendealtwithinanunsatisfactoryandsuperficial way. Authors have acknowledged the problem but have rarely givenanswerstoit.Asanexample,itisworthnotingthattheEFILA,inits2015“ResponsetocriticsagainstISDS”,hasstatedthatinconsistencyisa“naturalconsequenceofthesystem”.91Itisthereforetruethat“thelackofcoherencewithintheITAsystemlikelyhas become the ground upon which the system is most frequently criticized byscholarsandcommentators”.92 This book will therefore try to give an answer to this problem, focusing inparticularontheexistingstructureofBITsandadhocinvestmenttribunals,which–intheopinionofthepresentauthor–stilloffersometoolstobeusedinordertofacetheissueofparallelproceedingsand the consequent lackof coherenceandconsistencywithininvestmentlawandarbitration. Chapter1willbeaimedatprovidingthereaderswiththetaxonomyofparallelproceedings in investment arbitration and at analysing the policy considerations at

88Id.,10(footnotesomitted).89Ouropinion,inthisregard,issimilartotheoneexpressedbyDiBenedetto(2013)(n.51),42-43.Itistherefore possible to refer to a legal definition of “self-contained regime” within the framework ofpublicinternationallawgivenbytheInternationalLawCommission(Fifty-eightsession),Fragmentationof International Law: Difficulties Arising from the Diversification and Expansion of International Law,Report of the Study Group of the International Law Commission finalized by Martti Koskenniemi,A/CN.4/L.682, 13 April 2006, according to which “this legal notion may concern entire fields ofinternational law (such as human rights law, trade law, etc.) and implies that “rules of generalinternational law are assumed to bemodified or even excluded in the administration (interpretationandapplicationofrules)ofthesefields”.However,asnotedbyDiBenedetto,thefactthatinternationalinvestment lawmaybe consideredas a sub-systemofgeneral international lawdoesnotmean thatinternational investment law cannot derogate to public international law, due to the fact thatinternational investment law is to be considered as a lex specialis within the general framework ofpublic international law.Withregardtothepossibleorderlinessofpublic international lawseeShany(2003)(n.47),77andss.90In this regard see alsoAlvarez,AppealsMechanism in International InvestmentDisputes (2008), 32,whohasbasedthelegitimacyofinternationalinvestmentlawonthecoherencyofitsrules.91EFILA(2015)(n.7),12andss.92Meyers(2008)(n.13),15.

30

thebasisof theneedofconsistency,coherenceandfinality in the in thenetworkofinternationalinvestmentlawandarbitration.

31

Chapter1Internationalinvestmentarbitrationandtheneedforcoherence

This Chapter will introduce the topic of parallel proceedings in investmentarbitration. First of all itwill give adefinitionof theproblemand itwill provide thereaderwithananalysisofthetaxonomyofmultipleproceedings(Paragraph1.1)andasearch for the historical reasons behind the emergence of the problem (Paragraph1.2).Itwillbedemonstratedthat–asinvestmentarbitrationistodayconfigured–itisquite inevitable tohave (at least the riskof)parallel/multipleproceedings related tothe same claim. Secondly, andmainly, theChapter is aimed at demonstratingwhyparallelproceedingsshallbeavoided.Policyconsiderationsandissuesrelatedtotheemergenceofparallelproceedingswillbethereforedeeplyanalysed. In this Chapter the author will try to demonstrate that the issue of parallelproceedings has not only procedural implications. Indeed this problem involves, ontheonehand,systemicissuesand,ontheotherhand,substantiveimplicationsontherights of the parties involved in the dispute from which parallel proceedings arise.Therefore,thereareseveralpolicyconsiderations(whichwillbeanalysedinParagraph1.3) that lead us to search for a solution to the issue at stake: such considerationspertaintoproceduralandsubstantiveaspects. Proceduralaspectsmainlyregardefficiencyinarbitrationandtheneedtosavecostsandtimeinordertoletinvestmentarbitrationmaintainitskeyadvantages. Concerning the substantive implications of parallel proceedings, it will bedemonstrated that the existence of several claims in relation to the same dispute(withtherelatedriskofconflictingoutcomes)willunderminetheessentialelementsofalegalrelationshipbetweentwopartiesanddestroytheprincipleoflegalcertainty. Finally, after having explained (in Paragraph 1.4) the main objective of thisbook (i.e. to provide a general remedy to the problem of parallel proceedings ininvestment arbitration) it will be explained what are the proposed tools to moveforward fromthe impassegeneratedbyparallelproceedings.Wewill finallyprovidetheplanoftherestofthework.

1.1 The taxonomy of multiple claims and their inevitability of parallelproceedings

Parallel proceedings in international arbitration have been defined as

“proceedingspendingbefore[adomesticcourtor]anotherarbitraltribunal inwhichthepartiesandoneormoreoftheissuesarethesameorsubstantiallythesameastheonesbeforethearbitraltribunalinthecurrentarbitration”(emphasisadded).1

This definition, which looks at parallel proceedings from a substantiveperspective,considersasparalleltheproceedingsinwhich:

1Erk-Kubat,ParallelProceedingsinInternationalArbitration:AComparativeEuropeanPerspective(2014),15.

32

1) thepurposeoftheclaimsisthesame;2) thefactsonwhichtheclaimsarebasedarethesame;3) thepartiesinthetwoproceedingsrepresentthesameinterest,eveniftheyare

notformallyidentical.In the present study, we will refer to parallel proceedings also in case of

proceedingsthatarenotconcurrentlypending,eventhoughtheysubstantiallyinvolvethesamepurpose,factsandinterestsbetweenthesameparties.Inregardtothislastcategory of proceedings, it is worth mentioning that it would be maybe moreappropriatetospeakaboutmultipleproceedings.However,forthesakeofclarity,wewill discuss about parallel proceedings as a general category, involving bothconcurrentandsubsequentproceedings(based,asalreadysaid,onthesamepurpose,factsandinterests).

It is self-evident that, in the framework of today’s very complex investmentoperations, involvingseveral (andcomplex) legal instruments(i.e.treaties,contractsandlaws)andvariousrelatedentities(usuallyfromtheinvestor’sside),itisquiteeasythattwoproceedingscouldfallintotheaforementioneddefinition.

As it has been stated by several authors, parallel proceedings are“fundamentally undesirable”2in light of the fact that they incur very high costs,generate the risk of conflicting outcomes and also undermine the credibility of theadjudicatory system. As the former President of the International Court of Justice(“ICJ”),GilbertGuillaume,statedin1995,“itwouldbemostregrettableif,onspecificproblems,different courtswere to takedivergentpositions”.3In the years followingGuillaume’s statement a further dramatic expansion of the number of internationalproceedingsstartedbyindividualsagainstStatesoccurred(inparticularinthefieldofinternational investment law), with the consequent growth of the risk of parallelproceedingsandconflictingawards.4

The proliferation of international courts and tribunals (and the related risks,suchas conflictingoutcomes, riseof costs and legitimacy crisis) is indeedageneralphenomenon of international law,5which has one of its greatest manifestations ininternational investment law. This is due to the particular features of investmentoperations and to the characteristics of legal instruments governing internationalinvestments,aswellas(aswewillseebelow)toarigidapplicationoftheprincipleofpartyautonomybyinvestmenttribunals,regardlessofthepolicyconsiderationsthatgoagainstparallelproceedingsandconflictingawards.

2Wehland,TheCoordinationofMultipleProceedingsinInvestmentTreatyArbitration(2013),2.3Guillaume,ICLQ(1995)862.4Oellers-Frahm,MaxPlanckUNYB(2001),67,Romano,Int’lLawandPolitics(1999)709,Buergenthal,Leiden Journal of International Law (2001), 267. The problem of themultiplication of tribunals wasalreadymentionedbyQuadri,DirittoInternazionalePubblico(1968),262andss.5It isnotpossiblehere togiveageneraloverviewof thephenomenon. In this regard,please refer toShany,TheCompetingJurisdictionsof InternationalCourtsandTribunals (2003),1andss.,Giorgetti,ICSIDReview(2015),98andss.,andvanAaken,FinnishYearbookofInternationalLaw(2006),91andss.

33

The following sub-paragraphs will examine the features of investmentoperationsthatmainlyaffect(andfragment)thejurisdictionofinvestmentarbitrationtribunals,and inparticular: (i) thedifferencebetweencontractandtreatyclaims; (ii)the entitlement of company’s shareholders to bring an investment claim; (iii) theentitlement of each entity of a group to bring its autonomous claim; and (iv) theavailabilityofseveralmeansofdisputeresolutionwithinthesamelegalinstrument.

1.1.1 Contractandtreatyclaims Historically, foreign investments involved the signing of a contract betweentheinvestorandthehostState.6Thesecontractssetforththestandardoftreatmentof investorsand, in thepast,generallyprovidedfor theresolutionofdisputes in thenationalcourtsofthehoststateaccordingtothelawofthehostState.7 Withtheevolutionofthestandingofindividualsbeforeinternationaltribunals,investmentcontractshaveevolved,alsoprovidingforthepossibilitytosettledisputesbeforeadhoctribunalsorinternationallyadministeredarbitrations.8 In parallel, in particular in the second half of the 20th century,9a system ofbilateraltreatiesforthepromotionandprotectionof investments (BITs), regulatingthetreatmentofinvestorsofoneofthesignatoryStatesintheothersignatoryState,has emerged.10Usually, according to such BITs, the relationship between investorsandhostStatesshallbegovernedbyinternationallaw.11

6Sacerdoti,Icontrattitrastatiestranierineldirittointernazionale(1972),1andss.7Tonini, La tutela internazionale dei diritti contrattuali degli investitori stranieri (2011), 4 and ss.,Savarese,Lanozionedigiurisdizionenel sistema ICSID,http://paduaresearch.cab.unipd.it/3532/ (2012),12, Amerasinghe, International Arbitral Jurisdiction (2011), 3-13. During the 20th century foreigninvestmentshavenotalwaysbeenacceptedbydevelopingcountries,whichclaimedtheirsovereigntyonnaturalresources.Forthisreasontheso-calledCalvoDoctrine,requiringthatalldisputesbetweeninvestorsandthehoststateshouldhavebeenresolvedinnationalcourtsofthehoststate,emerged.InthisregardseealsoConforti,DirittoInternazionale(2013),248andss.Disputesbetweeninvestorsandstates havebeen traditionally considered as part of thediscipline of state responsibility for injury toaliens.SeealsoLillich,InternationallawofStateresponsibilityforinjurytoaliens(1983),Amerasinghe,StateResponsibilityforInjurytoAliens(1967).Forageneralapproachtothelawappliedtoinvestor–States contracts see Bernardini in Law of International Business and Disputes Settlement in the 21stcentury–LiberAmicorumKarl-HeinzBockstiegel(2004),51andss.8RadicatidiBrozolo,RivistadiDirittoInternazionale(1982),299andss.9Alexandrov,JournalofWorldInvestmentandTrade(2006),387,hastalkedabouttheoccurrenceofa“babyboom”ofinvestor-Statearbitrationsinthe’90s.10Vandevelde, Bilateral Investment Treaties (2010), 1 and ss., Mauro, Gli accordi bilaterali per lapromozioneeprotezionedegliinvestimenti(2003)1andss.ThefirstBIT,betweenGermanyandPakistanhasbeenenteredintoin1959.Today,accordingtoSavarese(2012)(n.7),15,thereareabout3000BITsinforce.SeealsoBockstiegel,PapergivenattheConference50YearsofBilateralInvestmentTreaties–TakingStockandLooktotheFutureFrankfurt(2009),2andss.WithregardtothegeneralcontentofBITs seeValenti,Gli standard di trattamento nell’interpretazione dei trattati inmateria di investimentistranieri(2009),26andss.,andValenti,DirittodelCommercioInternazionale(2004),973andss.11SeeSchreuer,McGillJournalofDisputeResolution(2014),1andss.

34

Thestandardsoftreatment involvedinsuchtreatiesareusuallyverybroad.12As an example, it could be mentioned that under the label of “fair and equitabletreatment” arbitrators have involved standards of due process, legitimateexpectationsandproportionality.13Itoftenhappens,therefore,thattheviolationofastandard included in a contract can be considered also as a violation of a treatystandard.14 Often – in fact – the existence of a contractual breach is seen as anindicatorof the fact that therehasalsobeenabreachofabroader treatystandard.Thismayhappen,inparticular,whenBITscontainaso-called“umbrellaclause”,which– according to themajority of scholars – equalizes all the violations of contractualdutiestoviolationsoftreatyduties.15

Hence,regardingtheclaimsarisingfromaninvestmentcontract,“thequestionemerges as to which dispute resolution procedure must be applied – the onecontainedintheapplicableBITortheoneindicatedbytheinvestmentcontractwhichthe investor itself stipulates with the host State”. 16 As a matter of principle,considering that “there is no a priori limitation on the scope or content of treatyobligations... There is no a priori definition ofwhat is or is not international, nor isthere any presumption of the restrictive interpretation of treaties”,17it is logical todeduce that “where there isaBITbetween the investor’sHomeStateand theHostState,thentheinvestormightpursueitstreatyrights”notwithstandingtheexistenceofacontractprotectingsimilar–ifnotthesame–rights.18 This view has developed since the very well-known decision in the Vivendiannulment proceedings. According to the ad hoc committee “as to the relationbetween breach of contract and breach of treaty… a state may breach a treatywithoutbreachingacontractandviceversa…Inaccordancewiththisgeneralprinciple

12BITsareaimedatthepromotionandprotectionofforeigninvestments.Withthisscopesuchtreatiesprovideforverybroadstandardoftreatmentsuchas“fullprotectionandsecurity”,“fairandequitabletreatment and “most favoured nation”. All these standards are protected through the right of theinvestor to initiate an arbitration directly against the host state before an international arbitrationpanel.13Palombino,Iltrattamentogiustoedequodegliinvestimentistranieri(2012),61andss.14Hariharan,JournalofWorld InvestmentandTrade(2013),1019andss.,Shany,AmericanJournalofInternationalLaw(2005),835andss.,Alexandrov,JournalofWorldInvestmentandTrade(2004),555andss.,YannacaSmall,OECDWorkingPapersonInternationalInvestments(2006),26andss.15Accordingtopartofthecaselaw,umbrellaclauseshavethescopeofconvertingallcontractclaimsintreaty claims. However, there is no agreement on the interpretation of umbrella clauses. See thedifferentapproachesinSociétéGénéraledeSurveillanceS.A.v. IslamicRepublicofPakistan,wherethetribunal denied the possibility to interpret extensively an umbrella clause, and Société Générale deSurveillanceS.A.v.RepublicofthePhilippines,wherethetribunalconsentedtosuchaninterpretation.SeeZivkovic (2011), 10andss.,Bergamini,Rivistadell’arbitrato (2005),118andss,Carlevaris,Rivistadell’arbitrato (2004), 431 and ss., Wendlandt, Texas International Law Journal (2008), 523 and ss,Weissenfels(2007),1andss,YannacaSmall,OECDWorkingPapersonInternationalInvestment(2006),1andss.,Schill,MinnesotaLawJournal (2009,1andss.,Wong,Geo.MasonLawJournal (2006),135andss.Thissubjectwillbefurtherexaminedinparagraph1.6below.16Savarese,JournalofWorldInvestmentandTrade(2007),409.17Crawford,ArbitrationInternational(2008),353.Asstatedbythisauthor,theauthorityfortheabovestatementis“TheWimbledon”(1923)PCIJSer.ANo.1.18Cremades, Cairns, in Arbitrating Foreign Investment Disputes. Procedural and Substantive LegalAspects(2004),325.

35

(which is undoubtedly declaratory of general international law) whether there hasbeen a breach of the BIT and whether there has been a breach of contract aredifferentquestions.Eachof theseclaimswillbedeterminedby referenceto itsownproperorapplicable law– inthecaseoftheBIT,by international law; inthecaseofthecontract,bytheproperlawofthecontract,inotherwords,themunicipallaw”.19“Inacasewheretheessentialbasisofaclaimbroughtbeforeaninternationaltribunalisabreachofcontract,thetribunalwillgiveeffecttoanyvalidchoiceofforumclauseinthecontract”.20“Ontheotherhand,wherethe‘fundamentalbasisoftheclaim’isatreatylayingdownanindependentstandardbywhichtheconductofthepartiesistobejudged,theexistenceofanexclusivejurisdictionclauseinacontractbetweentheclaimantandtherespondentstateoroneofitssubdivisionscannotoperateasabartotheapplicationofthetreatystandard.Atmost,itmightberelevant–asmunicipallawwilloftenberelevant–inassessingwhethertherehasbeenabreachofthetreaty”.21 Theimmediateconsequenceofwhatstatedaboveisthattheinvestorhasthechoicetopursue:(i)thecontractclaim;(ii)thetreatyclaim;or,intheory,(iii)boththecontract and the treaty claim.22It is therefore obvious that the dualism betweencontractandtreatyclaimscreatesand/orincreasestheriskofparallelproceedings. ThisiswhathashappenedintheRSMProductionCorporationvGrenada23andin the Rachel S. Grynberg, Stephen M. Grynberg, Miriam Z. Grynberg and RSMProduction Corporation v Grenada24cases. Such cases arose from the same facts,concerning the circumstance that Grenada dismissed a petroleum license that itgrantedtoRSM,duetoanuntimelyapplicationbythe latter.RSMstartedan ICSIDarbitration(onthebasisoftheinvestmentagreement)whereupontheTribunalfoundthat Grenada did not violate any BIT obligation. RSM than filed a petition forannulment(whichwaslaterdismissedduetoRSM’sfailuretopayannulmentcosts).25In themeanwhile, RSM’s shareholders (jointlywith the sameRSM) started another

19CompaniadeAguasdelAconquijaSAandCompagnieGénéraledesEaux/VivendiUniversalv.ArgentineRepublic,ICSIDCaseNo.ARB97/3,DecisiononAnnulment,3July2002,paras.95-96.InthisregardseeGaillard, Transnational Dispute Management (2004), 6 and ss. Similarly, note Lanco Int’l Inc. v.Argentina Republic, ICSID Case No. ARB/97/6, decision on jurisdiction, Salini Costruttori S.p.A. andItalstrade S.p.A. v. Kingdom of Morocco ICSID Case No. ARB/00/4, final award, Sempra EnergyInternational v. Argentina, ICSIDCaseNo.ARB/02/16,Decision onObjections to Jurisdiction, 11May2005.Withregardtothedistinctiondrawnupbytheadhoccommitteeitshouldbenotedthatitisnotalwayseasytodistinctbetweencontractandtreatyclaims.OnthispointseeWehland(2013)(n.2),21.Thisstatementhasalsobeenconfirmedby investmenttribunalssuchas Impregilov.Argentina, ICSIDCaseNo.ARB/07/17,Awardof21June2011,para.175.20Ibid.para.98.21Ibid. para. 101. With regard to the substantive law applicable to contract and treaty claims seeWehland(2013)(n.2),22.22Cremades,Cairns(2004)(n.18),326.23RSMProductionCorporationvGrenada,ICSIDCaseNoARB/05/14,Award,13March2009.24Rachel S Grynberg, Stephen M Grynberg, Miriam Z Grynberg, and RSM Production Corporation vGrenada,ICSIDCaseNoARB/10/6,10December2010.25RSMProductionCorporationvGrenada, ICSIDCaseNoARB/05/14,AnnulmentProceedings,28April2011.

36

claimpursuanttotheU.S.–GrenadaBITonthebasisofthesamefacts.AswewillseeinChapter3,thesecondclaimwasdismissedbytheTribunal. Inthisregard,itisworthnotingthatinordertoavoidaconflictofjurisdictionbetween arbitral tribunals and national courts, some treaties contain a so-called“waiverclause”.26Asanexampleitispossibletociteart.1116(b)NAFTA,accordingtowhich“theinvestor…waivesitsrighttoinitiateorcontinuebeforeanyadministrativetribunalorcourtunderthelawofanyParty,orotherdisputesettlementprocedures,anyproceedingswithrespecttothemeasure…thatisallegedtobeabreach…exceptforproceedingsforinjunctive,declaratoryorotherextraordinaryrelief”.27Inthesamevein, other treaties contain the so-called “fork-in-the-road” provisions, which applytheLatinmaximelectaunaviaalteranondatur.Anexampleofthisprovisionsisarticle10(2) of the Greece-Albania BIT which provides that if disputes cannot be settledamicably, "the investoror theContractingParty concernedmay submit thedisputeeither to the competent court of the Contracting Party or to an internationalarbitrationtribunal...".28 However,inreferencetosuchclausesitshouldbenotedthat“itisimpossibleto generalize onwhether a ‘fork-in-the-road’ clause orwaiver forces an investor toelect between treaty and contract claims, because itwould seem todependon theexactwording of the treaty”.29These clauses thereforemaynot be considered as ageneralremedyagainstparallelnationalandarbitrationproceedings.

Furthermore,andmoreimportantlyfortheaimofthepresentbook,suchclausesare not applicable in the cases of conflicts of jurisdiction between two arbitraltribunals,i.e.incasesthecontractprovidesforaformofarbitrationandthetreatyforanotherformofarbitration.Inthesecases,accordingtothewordingofthetwolegalinstruments, it ispossibleandperfectly legitimate for the investor to startboth thecontractandthetreatyclaims.WaiverclauseswillbefurtherexaminedinChapter2.

Inconclusion,fromtheperspectiveofthepresentbookthedifferencebetweencontractandtreatyclaimsisveryrelevant,beingoneofthemostrelevantsourcesofparallel arbitration proceedings.30It is finally worth considering that, in light of thefactthatcontractclaimsandtreatyclaimsarenotnecessarilygovernedbythesame

26SeeRomanetti,StockholmInternationalArbitrationReview(2009),75andss.27Thisprovisionhasbeenapplied inWasteManagement Incv.UnitedMexicanStates, ICSIDcaseNo.ARB (AF)/98/02,ArbitralAwardof2 June2000,15 ICSIDRevFILJ235-236,where the tribunal statedthat“whenbothlegalactionshavea legalbasisderivedfromthesamemeasures,theycannolongercontinuesimultaneouslyinlightoftheimminentriskthattheclaimantmayobtainthedoublebenefitinitsclaimfordamages.ThisispreciselywhatNAFTAart.1121seekstoavoid".28Dahlberg(2009).Forageneralanalysisoftherelevanceof localremedies in investmentarbitrationandfortheinteractionofsomeremedieswithinvestmentarbitrationsseeFoster,ColumbiaJournalofTransnationalLaw(2011),204andss.Suchauthor,at265,proposesanarrowinterpretationoffork-in-the-roadprovisions. 29Cremades,Cairns(2004)(n.18),333.30SeeSavarese,Dirittodel commercio internazionale (2004),955andss.Thecaseofmultipleclaimsstarted under contract and treaties is conceptually identical to the one of several claims startedaccording to various treaties (e.g. the EnergyCharter Treaty and a BIT) or according to a BIT and anationallaw.Forthisreasonwewillreferonlytocontractandtreatyclaimsintherestofthebook.

37

substantive law, it ispossible that twoarbitrations related to the same factswillbeconcludedwithdifferentoutcomes. 1.1.2 Majorityandminorityshareholders(orcompanyanditsshareholders) ThewordingofthevastmajorityoftheexistingBITsusuallyhasaverybroaddefinition of investment.31Therefore, BITs’ definitions are not anymore “enterprisebaseddefinitions”32–involvingthedirectrealizationofanenterpriseinthehoststateor,at least,anamountofshares inacompanyequal totheeffectivecontrolofsuchcompany – but have evolved as “asset based definitions” – involving portfolioinvestments and the mere ownership of shares, without specifying the necessaryamount of shares. 33 As stated by Schreuer, “the participation in the locallyincorporatedcompanybecomesthe investment”.34Asaconsequence, it isnowverycommontotalkaboutan“everykindofassetapproach”,inlightofthefactthatthemere ownership of an asset in a foreign company might be considered as aninvestment.35

Firstofall,Tribunalshaveoftenacceptedthepossibilityofautonomousclaimsbymajorityshareholders,bothonthebasisofthewordingofBITsandonthebasisofthecircumstancethattheconceptof“control”referredtointheICSIDConvention(ifapplicable)shouldbelogicallyassociatedtotheideaofamajoritarianpositioninthecompany’ssharesstock.36

31Schreuer,TransnationalDisputeManagement(2005),6andss.32See theBIT betweenDenmark andPoland of 1May 1990 stating that “(a) The term "investment"shallmeananykindofassets investedinaccordancewiththelawsoftheContractingPartyreceivingtheinvestmentinitsterritoryinparticular:(i)movableandimmovablepropertyandanyotherpropertyrightssuchasmortgages, liensorpledges, (ii) shares inandstockanddebenturesofacompanyandanyotherformofparticipation inacompany,(iii)claimstomoneyorotherrightsrelatingtoserviceshaving a financial value, (iv) industrial and intellectual property rights, technology, trademarks,goodwill,know-howandanyothersimilarrights, (v)businessconcessionshavingfinancialvalue,thatare required to conduct economic activity in accordance with the law of the Contracting Partyconcerned and are conferred by law, administrative decision or contract, including concessions tosearchfor,cultivate,extractorexploitnaturalresources.(b)Thesaidtermshallrefer:toallinvestmentsincompaniesmadeforthepurposeofestablishinglastingeconomicrelationsbetweentheinvestorandthecompanyandgivingtheinvestorthepossibilityofexercisingsignificantinfluenceonthemanagementofthecompanyconcerned”(emphasisadded).33See the 2008 UK Model BIT, stating that: ““investment” means every kind of asset, owned orcontrolled directly or indirectly, and in particular, though not exclusively, includes: (i) movable andimmovablepropertyandanyotherproperty rights suchasmortgages, liensorpledges; (ii) shares inandstockanddebenturesofacompanyandanyotherformofparticipationinacompany;(iii)claimstomoneyortoanyperformanceundercontracthavingafinancialvalue;(iv)intellectualpropertyrights,goodwill, technical processes and know-how; (v) business concessions conferred by law or undercontract,includingconcessionstosearchfor,cultivate,extractorexploitnaturalresources”(emphasisadded).34Schreuer(2005)(n.31),6.35SeeTonini(2011)(n.7),38andss.36SeeDumberry,Valasek,ICSIDRev.FILJ(2011),45andss.TheauthorsrefertothecasesGasNaturalSDGS.A.v.Argentina,ICSIDCaseNo.ARB/03/10,DecisiononJurisdiction,17June2005,AntoineGoetzandothersv.RepublicofBurundi,ICSIDCaseNo.ARB95/3,Award,para.89,10February1999,andSuez

38

Concerning the position of minority shareholders, while in the Vacuum Saltaward the tribunal held that the ownership of aminority percentage of shares in acompanycouldnotbeconsideredasasourceofforeigncontrolinlightofthefactthataminoritypositionismerelytechnicalandnotmanagerial,37thefollowingauthoritiesshowthatclaimsbyminorityshareholdersaretodaycommonpracticeininternationalinvestmentarbitration,bothadministeredbyICSIDtribunalsandinotherforms.

WithparticularregardtotheICSIDConvention,art.25(2)(b)allowsclaimsfromcompanies incorporated in the host State by attributing this right to “any juridicalpersonwhichhadthenationalityoftheContractingStatepartytothedisputeonthatdateandwhich,becauseofforeigncontrol,thepartieshaveagreedshouldbetreatedasanationalofanotherContractingState”(emphasisadded).38InthisregarditshouldbehighlightedthattheConventiondoesnotdefinetheconceptofforeigncontroland,therefore,arbitraltribunalshaveusually39interpretedsuchconceptonthebasisofthewordingoftherelevantBIT,thusallowingclaimsbroughtbyacompanyincorporatedinthehostState,ofwhichonlyaminorityshareholderhadthenationalityoftheothercontractingpartyintheBIT.40 Furthermore,onthebasisofthewordingofBITs,tribunalshaveadmittedthatminorityshareholdershavetheirautonomousclaim, independently fromthatof themain company. In CMS, where the claimant owned 29,42% of the shares of thecompany,theTribunalstatedthat it“findsnobar incurrent international lawtotheconcept of allowing claims by shareholders independently from those of thecorporationconcerned,notevenifthoseshareholdersareminorityornon-controllingshareholders”.41Tribunalshave therefore assumed jurisdictionon claimsbroughtbyshareholders representing even 14,18% of the company’s shares.42In Lanco, theTribunal stated that “as regards shareholder equity, theArgentina-U.S. Treaty saysnothing indicatingthatthe investor inthecapitalstockhastohavecontroloverthe

Sociedad General de Aguas de Barcelona S.A., and InterAguas Servicios Integrales del Agua S.A. v.Argentina,ICSIDCaseNo.ARB/03/17,DecisiononJurisdiction,16May2006.37Vacuum Salt v. Ghana, ICSID Case No. ARB/92/1, Award of 16 February 1994, where the Tribunalstated“itstandstoreason,ofcourse,that100percentforeignownershipalmostcertainlywouldresultin foreign control, by whatever standard, and that a total absence of foreign shareholding wouldvirtuallyprecludetheexistenceofsuchcontrol.Howmuchisenough,however,cannotbedeterminedabstractly(…).Interestssufficientlyimportanttobeabletoblockmajorchangesinthecompanycouldamounttocontrollinginterests(...)Controlcouldinfactbeacquiredbypersonsholdingonly25%ofthecompany’scapital(...)51%ofthesharesmaynotbecontrollingwhileforsomepurposes15%maybesufficient (…). The concept of control is broad and flexible (…). The question is (…) whether thenationality chosen represents an exercise of a reasonable criterion (…). A tribunal may regard onlycriterionbasedonmanagement,voting rights, shareholdingoranyother reasonable theoryasbeingreasonableforthepurpose”. SeeMorelandCurrentsInt’lTradeLawJ.(2000),20.38OnthispointseeMoreland,(2000)(n.37),19.39Seeparagraph1.6below,mentioningtheVacuumSaltcase,whereanoppositeconclusionhasbeenreachedbytheTribunal.40As itwill be seenbelow,Art. 25(2)(b) of the ICSIDConvention has been usually interpreted in thesensethatitisaimedatexpandingjurisdictionandnotatrestrictingit.41CMSGasTransmissionCo.v.RepublicofArgentina,ICSIDCaseNo.ARB/01/8,DecisiononJurisdiction,para.34,17July2003.42GAMIInvestmentsInc.v.Mexico,NAFTA(UNCITRAL),Award,para.37,15November2004.

39

administrationofthecompany,oramajorityshare;thusthefactthatLancoholdsanequityshareof18,3%inthecapitalstockoftheGranteeallowsonetoconcludethatitisaninvestorinthemeaningofArticleIoftheArgentina-U.S.Treaty”.43 The practice of assuming jurisdiction on claims brought by minorityshareholders is today so diffused that someAuthors have argued that a customaryruleofinternationallawhasdevelopedinthisregard.44 It should be also noted that the possibility of direct claims by minorityshareholders is not limited to the case of damages directly suffered by them andexpresslyprotectedbyaninternationallawrule.45Thereferencegoesalsotodamagessuffered by the main company and only indirectly affecting shareholders’ right,generallyduetoalossofvalueoftheirshares.

In international law it is clear that “claims based on a reflective injury toshareholders are generally barred”.46In this regard it is worth citing what the ICJstatedintheDiallocase:“TheCourt,intheBarcelonaTractioncase,recognizedthat“awrongdonetothecompanyfrequentlycausesprejudicetoitsshareholders”.But,itadded,damageaffectingbothcompanyandshareholderwillnotmeanthatbothareentitled to claim compensation… It is only one entity whose rights have beeninfringed”47andsuchentityisthecompany.

Arecentstudyhasalsoshownthatthepracticeofclaimsforindirectdamagessufferedbyshareholdershasaverylimitedapplicationinnationallawsystems.48Asithas been stated by the English Court of Appeal in Gardner v. Parker, “Theshareholder’slosswillbemadegoodifthewrongedcompany,whichhastheprimaryclaims,enforcesinfullitsclaimsagainstthewrongdoer”.49

International arbitral awards show that in international investment law thepractice is opposed to the one followed in national law systems and in generalinternational law.50Arbitral tribunalshave in fact“foundthatshareholderscanbring

43LancoInt’l,Inc.v.Argentina,ICSIDCaseNo.ARB/97/6,DecisiononJurisdiction,para.10,8December1998.44See, e.g.,McLachlan, Shore,Weininger, International Investment Arbitration: Substantive Principles(2007),186.ForacontraryopinionseeDumberry,MichiganStateJournalofInternationalLaw(2010),365andss.45InthisregarditshouldbenotedthatsincetheICJBarcelonaTractioncase(BarcelonaTraction,LightandPowerCo.,Ltd.(Belgiumv.Spain),Judgement,5February1970ICJRep.4,35)ithasbeenadmittedthat shareholders (or, in cases regarding diplomatic protection, their State of nationality) mayautonomously bring a claim arising from a rule that directly protects a shareholder’s right. This hasfurtherbeenconfirmed in theELSI case (ElettronicaSiculaS.p.A. (ELSI) (U.S.v. Italy), Judgement,20July1989,ICJRep.15,42.46Gaukrodger,OECDWorkingPaperonInternationalInvestment(2013),22.47 Ahmadou Sadio Diallo (Republic of Guinea v. Democratic Republic of the Congo), Decision, 30November2010,I.C.J.Rep.,639.48Gaukrodger(2013)(n.46),15andss.49Gardnerv.Parker,[2004]1BCLC417,430(Eng.Ct.App.2004).50Gaukrodger(2013)(n.46),25andss.Bottini,U.Pa.J.Int’l.Law(2010)563andss.

40

autonomousclaimsevenwhenthecompanyhaseffectiverecourse”.51ThedecisionsinAzurix,52LG&E,53Enron54andSiemens55maybecitedasexamplesofthispractice.56

In lightof theabove it is easy tounderstand that, if any shareholderhashisautonomousclaim,“nothingwouldpreventallthesedifferentshareholdersfromfilingtheirownseparateclaimsagainstthehostStateforthesametreatybreach”.57Thisiswhat has happened in the cases regarding Sempra v. Argentina58and Camuzzi v.Argentina,59where themajorityshareholder (Camuzzi)andtheminorityshareholder(Sempra) of the companies Sodigas Sur S.A. and Sodigas Pampeana S.A. filed twoseparaterequestsforarbitrationonthebasisofthesamefacts(inthiscase,asitwillbe seen below, the same Tribunal heard both the claims). Similarly, in CMS v.Argentina 60 and Total v. Argentina 61 the two claimants were both minorityshareholders of the company TGN and filed two separate claims arguing that thedifferentdatesofthepurchaseoftheTGNshareswasanelementfordistinguishingthetwoclaimswhicharosefromthesamefacts.Asitwillbeshownbelow,inthiscasethe two proceedingswere not coordinated and the two tribunals inCMS andTotalreacheddifferentconclusionsonthesameissues.

A very complex scenario also appeared in the disputes arising from the verywell knownYukos saga,where several shareholders of the Russian company Yukosstarted different claims on the basis of the same facts.62Various arbitration cases

51Gaukrodger(2013)(n.46),29.52AzurixCorp.v.ArgentineRepublic,ICSIDCaseNo.ARB/01/12,DecisiononJurisdiction,para.1,8December2003.53LG&E Energy Corp. v. Argentine Republic, ICSID Case No. ARB/02/1, Decision on Objections toJurisdiction,para.1,30April2004.54Enron Corp. v. Argentine Republic, ICSID Case No. ARB/01/3, Decision on Jurisdiction, para. 1, 14January2004.55Siemens A.G. v. Argentine Republic, ICSID CaseNo. ARB/02/8, Decision on Jurisdiction, para. 23, 3August2004.56FormorecasesseeBottini(2010)(n.50),584andss.ForacontrarycaseseeConsorzioGroupementL.E.S.I.Dipentav.Algeria, ICSIDCaseNo.ARB/03/8,Award,para.1,10January2005. Inthisregard itshouldbenoted that– inprinciple–also thecompany’s creditorswhohavesufferedan indirect lossmightbeentitledtofileaclaim.57Dumberry,Valasek(2010)(n.36),71.58Sempra Energy International v. Argentina, ICSID Case No. ARB/02/16, Decision on Objections toJurisdiction,11May2005.59CamuzziInt’lS.A.v.Argentina,ICSIDCaseNo.ARB/03/2,DecisiononJurisdiction,11May2005.Thetwoinvestorsfurtheragreedthatasingletribunalwouldhaveheardbothclaims.60CMSGasTransmissionCompanyv.Argentina,ICSIDCaseNo.ARB/01/8,Award,12May2005.61TotalS.A.v.Argentina,ICSIDCaseNo.ARB/04/1,DecisiononLiability,27December2010.62The factsareperfectlydescribed inpara.62of thePCAFinalAwardof18 July2014,mentioned infootnote63below. Inparticular,quoting thePCATribunal, “ThedisputesbetweentheParties to thepresent proceedings involve various measures taken by Respondent [Russia] against Yukos andassociatedcompaniesprimarilyintheperiodbetweenJuly2003andNovember2007,whenYukoshademergedafter thedissolutionof theSovietUnion tobecome the largestoil company in theRussianFederation. The measures complained of include criminal prosecutions, harassment of Yukos, itsemployees and related persons and entities; massive tax reassessments, VAT charges, fines, assetfreezesandothermeasuresagainstYukostoenforcethetaxreassessments;theforcedsaleofYukos’coreoilproductionasset;andothermeasuresculminatinginthebankruptcyofYukosinAugust2006,the subsequent saleof its remaining assets, andYukosbeing struckoff the register of companies inNovember 2007. Claimants contend, and Respondent denies, that Respondent failed to treat

41

emerged63and, as will be seen below, the same Tribunal has heard three of suchclaims.

It could also well happen that two claims are started by the company whomaterially made the investment and one or more of its shareholders. Any of thetribunals involved inthedisputesarising inthisscenariocouldwellconsider itselfashavingjurisdictiononthesingleclaimthatthesametribunalisgoingtoface.

Asaconsequence,theentitlementofthecompanyandofeachshareholdertobringhisautonomousclaim–fordirectandindirectlosses–shallbeconsideredasthesecondmainsourceofparallelproceedingsandconflictingoutcomesininternationalinvestmentarbitration.Inthisregard,itisworthmentioningwhathasbeenstatedbyZachary Douglas, according to whom “it is difficult to imagine why a shareholderwould elect to bring a claim for the account of its company if it had the option ofbypassingthecompanyaltogether.Thecompanymightbeabletopaycreditors,localtaxesanddischargeotherobligationsbeforedistributingtheresidualamountofanydamages recovered to the shareholders”.64It is therefore obvious that, from theperspectiveofashareholder,startinganautonomousclaimagainstthehostStateisthepreferableoption.

1.1.3 Chainofentitiesofthesamegroup

“In the vast majority of cases investors are companies… Corporations areownedbyshareholderswhomaythemselvesbecompanies”.65Investmentsveryoftenpresent a complex structure consisting of companies incorporated in different

Claimants’ investments inYukos ina fairandequitablemannerandonanon-discriminatorybasis, inbreachofArticle10(1)oftheECT,andthatRespondentexpropriatedClaimants’investmentsinbreachofArticle13(1)oftheECT.ClaimantsseekfullreparationinexcessofUSD114billion”.63Arbitrations started byminority shareholders:Quasar de Valores SICAV S.A. v. Russian Federation,Stockholm Chamber of Commerce (SCC) Award, 20 July 2012, RosInvest Co UK Ltd v. The RussianFederation, SCC Case No. Arb. V079/2005, Final Award, 12 September 2010. Arbitrations started bymajority shareholders:Hulley Enterprises Ltd v. Russia, YukosUniversal Limited v. Russia andVeteranPetroleumLimitedv.Russia,UNCITRAL,PermanentCourtofArbitration,InterimAwardonJurisdictionand Admissibility, 30 November 2009, and Final Award, 18 July 2014. In order to understand thepercentagesofmajorityshareholdinginYukos,itisworthquotingparas65-69oftheFinalAwardof18July2014:“65.ThethreeClaimantsintheserelatedcasesareallpartoftheYukosgroupofcompanies,which had at its center Yukos, headed by Chief Executive Officer Mr. Mikhail Khodorkovsky. 66.ClaimantinPCACaseNo.AA226,Hulley,wasincorporatedintheRepublicofCypruson17September1997andwasa100percentownedsubsidiaryofYUL[YukosUniversalLimited].67.Claimant inPCACaseNo.AA227,YUL,wasincorporatedon24September1997intheIsleofMan(aDependencyoftheUnited Kingdom). 68. Claimant in PCA Case No. AA 228, VPL [Veteran Petroleum Limited], wasincorporatedintheRepublicofCypruson7February2001.69.Hulleyheldapproximately56.3percent,YULheldapproximately2.6percentandVPLheldapproximately11.6percentoftheoutstandingsharesinYukos.Collectively therefore,Claimantsapproximatelyhada70.5percent shareholding inYukos”.See also footnotes 137 and 138 below (referring also to the claim before the ECtHR and the ICCarbitrationTribunal).WithregardtotheaspectthatthefinalownerofthewholegroupwastheRussiancitizenMr.Khodorkovsky,pleaserefertoparagraph1.1.3below.64Douglas,TheinternationalLawofInvestmentClaims(2009),452.65Schreuer(2005)(n.31),1.

42

jurisdictions and owned by nationals of different countries.66It is possible, in thisregard, to talk about “strategic structuring”;67 companies are therefore “readilyestablishedinordertoallowtheirownerstobenefitfromcertainadvantagesrelatedtotheirplaceofincorporation”.68

Thispracticeiscommonlyacceptedbyinternationalinvestmenttribunals.ItisworthmentioningthattheAguasdelTunariTribunalstatedthat“itisnotuncommoninpractice,and–absentaparticularlimitation–notillegaltolocateone’soperationsinajurisdictionsperceivedtoprovideabeneficialregulatoryandlegalenvironmentinterms,forexample,oftaxationorthesubstantivelawofthejurisdiction,includingtheavailability of a BIT”. 69 Similarly, the HICEE tribunal stated that structuredinvestments“arenotunusual,noristhereanythingintheleastreprehensibleaboutit;structuredinvestmentsarecommonplace.Thepurposeistosecureadvantagesfromincorporationoroperation inaparticular jurisdiction;…Theadvantagesanticipatedoftenincludetheprotectionofparticularbilateral(orother)treatiescoveringforeigninvestment”.70This shall be added to the fact that “some States actively promotethemselves as favourable venues for corporatepresenceandaccess to a favourablenetwork of investment treaties… Such an approach may also boost investmentinflows”.71

On the basis of the wording of the BITs, usually considering as foreigninvestors companies which have the nationality of the other contracting state(regardlessoftheeffectivecontrolofthecompany),tribunalshavethereforeassumedjurisdictioninthefollowingcases:72

1) claimant which have an indirect interest in a locally incorporatedcompany through their participation in another corporation, whichmayhavethenationalityof theclaimant investor,73thehostState74andofathirdState;75

66Wisner,Gallus,JournalofWorldInvestmentandTrade(2004),927.67Sinclair,ICSIDRev.FILJ(2005),357.SeealsoSchreuer,TheFordhamPapers(2012),17andss.68Ibid.,363.69AguasdelTunariS.A.v.RepublicofBolivia, ICSIDCaseNo.ARB/02/3,DecisiononJurisdiction,para.33021October2005.70HICEEv.Slovakia,UNCITRAL,PCACaseNo.2009-11,PartialAward.23May2011.71Sinclair(2005)(n.67),363.72SeeDumberry,Valasek(2010)(n.36),51andss.ThefollowingexamplesaretakenbyDumberryandValasek’sarticle.73SiemensA.G.v.ArgentineRepublic,ICSIDCaseNo.ARB/02/8,DecisiononJurisdiction,3August2004,wheretheGermanclaimant(Siemens)owned100%ofanotherGermancorporation(SiemensNixdorfInformationssysteme),which– in turn–createdandcontrolledanArgentiniancompany (Siemens ITServicesS.A.).74EnronCorp.v.ArgentineRepublic,ICSIDCaseNo.ARB/01/3,DecisiononJurisdiction,14January2004,wheretheU.S.corporationEnronownedaparticipationinanArgentiniancompany(TransportadoradeGasdelSur),whichhadseveralparticipationsinotherArgentiniancompanies.75WasteManagementIncv.UnitedMexicanStates(II),ICSIDcaseno.ARB(AF)/00/3,Awardof30April2004. Here, the U.S. claimant owned two holding corporations incorporated in Grand Cayman (UK)(AcaVerdeHoldingsLtd.andSunInvestmentCo.),which–inturn–ownedthecompanyincorporatedinthehostState(Acaverde).

43

2) claimant which are intermediate (“holding”, “shell” or “mailbox”)corporations. Such companies “are typically incorporated infavourabletaxjurisdictions.Theyusuallyhavenosignificantassetsoroperationsandareestablishedforthesolepurposeofowningsharesofothercorporations”.76

With particular reference to the casesmentioned under 2), arbitral tribunalsand scholars have sometimes expressed their perplexities concerning the risk ofabuses of investment arbitration, due to the fact that such “shell” companies havebeen incorporated in countries of convenience for the mere purpose of gainingjurisdiction in international investmentarbitrations. It is interesting tonote that theproblem has also arisen even in cases where the ultimate owner had the samenationalityofthehostState.Thishappened,interalia,inTokiosTokeles,77Rompetrol78and Yukos.79With particular reference to the last mentioned case, the tribunal hasclearly stated that the definition of “investor” in the Energy Charter Treaty (ECT)(Article 1(7)) does not function to deny standing to shell companies incorporatedunderthelawsofasignatoryState,evenif,asinthepresentcase,theclaimantwasowned by the Russian citizen Mr. Khodorkovsky. The ECT, in fact, refers to “acompany or other organization organized in accordance with the law applicable inthatContractingParty”,thusprecludingananalysisoftheeffectivecontrolontherealmanagementofthecompany.Thetribunalacceptedjurisdictionandstatedthat,onthebasisoftheECT,itwas“notentitledtofindotherwise”.TheTribunalappliedthe“plainmeaning doctrine” and interpreted the ECT in its literary sense.Quoting theSaluka80Tribunal, it stated that it had “some sympathy for the argument that acompanywhich has no real connectionwith a State party to aBIT, andwhich is inrealityamereshellcompanycontrolledbyanothercompanywhichisnotconstitutedunder the lawsof thatState, shouldnotbeentitled to invoketheprovisionsof thattreaty”;howevertheTribunaldeclarednottohavealternativestogiveweighttowhatthepartieshaveexpressedinthearbitrationclauseandassumedjurisdiction.81 The above approach of arbitral tribunals – which, to the knowledge of thepresent author, has been (partially and in different circumstances, that will be

76Dumberry,Valasek(2010)(n.36),55.77Tokios Tokeles v. Ukraine, ICSID Case No. ARB/02/18, Decision on Jurisdiction, 29 April 2004. Thisaward has been strongly criticized by Alexeyev, Voitovich, Journal of World Investment and Trade(2008).TheAuthors inparticular criticized thevery formalisticapproachof theTribunaldisregardingcommercialreality.78TheRompetrolGroupN.V.v.Romania,ICSIDCaseNo.ARB/06/3,DecisiononJurisdiction,18April2008.79YukosUniversalv.RussianFederation,(UNCITRAL)PermanentCourtofArbitration,InterimAwardonJurisdictionandAdmissibility.30November2009.80SalukaInvestmentsBVv.CzechRepublic,(UNCITRAL)PermanentCourtofArbitration,PartialAward,17March2006.81ForageneralanalysisoftheawardseeBlyschak,RichmondJournalofGlobalLaw&Business(2011),179.

44

examined inparagraph1.2and1.4)put indiscussiononly in theTSA82andNationalGas83awards–hasgeneratedapracticeknownas“treatyshopping”.84Suchconcepthas been defined as a “commonly used scheme for multinational corporations to‘steal’ not only higher levels of protection, advantage or benefit, but also thejurisdictionofarbitraltribunals.Withasignificantlygrowingnumberof internationalinvestment treaties, the practice of treaty shopping has become increasinglyrampant” (emphasis added).85Bernardo Cremades has talked, in this regard, about“gamblingmethods”.86Blyschakhasreferredtoaninvestorwhich“freeloads”ontoatreatythatwasnotproperlyintendedtoapplytotheinvestor.87 Thedirectconsequenceof theabove is thatseveralentitiesbelongingtothesame group of companies (and protecting the same interests) may start differentclaims according to the terms of different BITs (the BITs that the various States ofnationalityof suchentitiesconcludedwith thehostState) inorder toseek relief fortheallegeddamagethatthegroup(rectiusthefinalowners)suffered. This iswhathashappened intheCME88andLauder89cases.RonaldLauder,aU.S. national, was the ultimate beneficiary of an investment in a Czech operatingcompany (CNTS) providing television services. The investment was performedthrough an intermediate corporation (CME). After the host State took certainmeasures concerning TV licenses, Lauder started an ad hoc arbitration in LondonundertheU.S.A.–CzechRepublicBITandCMEstartedaSCCarbitrationundertheNetherlands – Czech Republic BIT. The two tribunals reached completely oppositeconclusionswithregardtotheevaluationofthesamefacts. As it will be better seen in paragraph 1.4 below, it could be said that thepractice of treaty shopping is fully justifiable on the basis of the wording of themajority of BITs and on the basis of the literal interpretation that arbitral tribunalshave given of arbitration clauses contained in these treaties on the basis of thenecessityof respectingtheprincipleofpartyautonomyasexpressed in therelevantarbitrationclause.90

82TSASpectrumdeArgentinaS.A.v.ArgentineRepublic,ICSIDCaseNo.ARB/05/5,Award,19December2008.Foracommentonthiscase incomparisonto theapproachtaken inTokiosTokeles seeMartin,TransnationalDisputeManagement(2011).83NationalGasS.A.E.v.ArabRepublicofEgypt,ICSIDCaseNo.ARB/11/7,Award,3April2014.Asitwillbe seen below (paragraph 1.6) these awards cannot be considered as a deviation from the mainapproachdescribedinthetext.84SeeKirtley,JournalofWorldInvestmentandTrade(2009),427andss.,Burgstaller,JournalofWorldInvestmentandTrade(2006),857andss.85Zhang,Contemp.AsiaArb.J.(2013),50.86Cremades,JournalofWorldInvestmentandTrade(2004),89.87Blyschak(2011)(n.81),195.88CMEv.CzechRepublic,UNCITRAL,SCCPartialAward,13September2001.89RonaldS.Lauderv.CzechRepublic,UNCITRAL,FinalAward,3September2001.90Zhang(2013)(n.85),51.Apossiblestoptothisphenomenoncouldberealizedthroughtheso-called“denialofbenefits clauses”, aimedat limiting theprotectionaffordedby investment treatiesonly toforeign companies which have an actual connection with the State in which they are incorporated.Examplesofsuchclausesarearticle17oftheEnergyCharterTreatyandarticleII.14oftheTrans-PacificPartnershipTreaty,whichdeniestheprotectionofthetreatytoshellcompanies.Inthisregarditshould

45

Asanyformofforumshopping,91thispracticehasverycontroversialeffects,92but it is not forbidden on the basis of a plain reading of the relevant sources.93Tribunals have therefore allowed treaty shopping and corporate manoeuvring,94unlessthecasesofabusesthattheyhavedeemedmanifestonthebasisof theveryshorttimepassedbetweenachangeofthecorporatestructure(aimedatgainingtheprotectionofacertainBIT)andthebeginningofthearbitration.95 1.1.4 Differentadjudicationsystemsprovidedinthesamelegalinstrument

The lastand residual sourceofparallelproceedings (the interest forwhich ismoretheoreticalthanpractical) isgivenbythecircumstancethatarbitrationclausesin several BITs or in investment agreements often provide for various means ofdispute resolution (e.g. ICSIDarbitration,adhoc/UNCITRALarbitration, institutionalcommercialarbitration,nationalcourts).

Asanexample,itcanbementionedArticle8ofUKModelBIT,statingthat:(1) (…)(2) Where the dispute is referred to international arbitration, the

nationalorcompanyandtheContractingPartyconcernedinthedisputemayagreetoreferthedisputeeitherto:

be noted that such clauses are not unanimously perceived as an effectivemechanism to limit treatyshopping. See Blyschak (2011) (n. 81), 191 and ss. The Author refers to the Yukos case in order todemonstrate the limitedapplicabilityof theseclauses inorder to limit treatyshopping.Forageneraloverviewof thesubjectseeMistelis,Baltag,PennStateLawReview(2009),1301andss.Foramajorfocusonprocedural requirementsseeGastrell,LeCannu, ICSIDReviewFILJ (2015), 78andss. In thisregard, it should be noted that, as it will better explained in paragraph 1.6 below, article X.3 of theinvestmentprovisionsoftheEU-CanadaFreeTradeAgreement(ComprehensiveEconomicandTradeAgreement – CETA) defines as investors only entities and natural persons which have a real andsubstantialbusiness in theterritoryofoneof thesignatoryStates.Suchprovisionthereforeexcludesclaimsbyshellcompanies.91Bassett,NorthCarolinaLawReview(2005-2006),333andss.,Koch,TheGenevaPapers(2006),293andss.,Maloy,QLR(2005-2006),25andss.TheAuthorsarguethatforumshopping–notwithstandingtheverynegativeopinionsrelatedtothispractice–isaperfectlylegitimateoptionforlawyers,whichhavethedutytofindthebestforumfortheirclients.InparticularBassett,335,explainsheropinionthatforum shopping and strategic choices are not a form of “cheating”, but a “legitimate, expresslyauthorizedactionwhenmorethanoneforumsatisfiestherequisitelegalcriteria”.ThesameAuthor,at336, states that “to the extent that strategy and choice play a role in litigation, forum shoppingencompassesboth”.AccordingtotheAuthortheresultofforumshoppingisnotnecessarilyunfair.Fora general analysis of the problem of forum shopping, see Ferrari (2013), 1 and ss., Brower, NorthCarolinaLawReview(1993),649andss.92SeeSchreuer(2012)(n.67),26-27.93SeeSacerdoti,JournalofWorldInvestmentandTrade(2004),97.94SeeAguasdel TunariS.A. v.Republic ofBolivia, ICSIDCaseNo.ARB/02/3,Decisionon Jurisdiction,para. 33021October2005,MobilCorporation,VenezuelaHoldingBV,MobilCerroNegroHolding,Ltd.,MobilVenezolanadePetroleosHoldings,Inc.,MobilCerroNegroLtd.,andMobilVenezolanadePetroleos,Inc. v. Bolivarian Republic of Venezuela, ICSID Case No. ARB/07/27, Decision on Jurisdiction, 10 June2010.SeealsoBlyschak,JournalofWorldEnergyLawandBusiness(2011),32andss.95SeePhoenixActionLtd.v.TheCzechRepublic,ICSIDCaseNo.ARB/06/5,Award,15April2009,BanroAmericanResources, Inc.andSociétéAuriféreduKivuetduManiemaS.A.R.L.v.DemocraticRepublicofCongo,ICSIDCaseNo.ARB/98/7,Award,1September2000.ForfurtherexplanationontheconceptsofabuseofrightsandabuseofprocesspleaseseeChapter3.

46

(a) the International Centre for the Settlement ofInvestment Disputes (having regard to the provisions,whereapplicable,oftheConventionontheSettlementof Investment Disputes between States and NationalsofotherStates,openedforsignatureatWashingtonDCon 18 March 1965 and the Additional Facility for theAdministration of Conciliation, Arbitration and Fact-FindingProceedings);or

(b) theCourtofArbitrationoftheInternationalChamberofCommerce;or

(c) aninternationalarbitratororadhocarbitrationtribunaltobeappointedbya specialagreementorestablishedunder the Arbitration Rules of the United NationsCommissiononInternationalTradeLaw.

SimilarprovisionsarecontainedinmanyotherBITs.96Intheabsenceof fork-in-the-roadprovisions,thissituationmightgiveriseto

parallel and un-coordinated proceedings. A party in bad faith could, indeed, startmorethanoneproceedingrelatedtothesamefactsinthevariousforasetforthinthearbitration clause and – in theory – each of the arbitral tribunals could assumejurisdiction on the dispute (this issue will be better examined at paragraph 2.1.1below). In this regard, anyway, it shall be considered that some Authors haveexpressedtheviewthatonceachoiceunderatreatyhasbeenmade,theothersareprecluded. Such a view is certainly correct in principle, but could be more easilyacceptedinpresenceofaclarifyingprovisiontothateffect.97

1.2 The reason behind parallel proceedings: the historical necessity to

incentivizeinvestments

Itisnowworthconsideringthereasonsbehindtheproliferationofforaforthesettlementofinvestmentdisputes.

InthisregarditishelpfultostartfromthewordsofEloiseObadia,whoin2002– referring to the activities of ICSID, today themost applied form of resolution ofinvestmentdisputes–statedthat“duringthefirst30yearsofitsexistence,ICSIDwassomewhat of a ‘Sleeping Beauty’, with an average of one or two cases beingregistered each year. It is with the widespread development of bilateral andmultilateralinvestmenttreatiesthattheactivitiesofICSIDhaveawakened…Inaway,thesebilateralandmultilateralinvestmenttreatiesaretoICSIDwhatPrinceCharmingwastoSleepingBeauty,havingstirredtheactivitiesoftheCentre”.98

96See,e.g.,article24(3)oftheU.S.ModelBIT.97SeeWehland(2013)(n.2),100.98Obadia,InvestmentTreatiesandArbitration(2002),67-68.

47

Thisstatementisstrictlyrelatedtothefollowingconsiderations:(i)priortothe“baby boom” of bilateral investment treaties (and of the related investor – Statearbitrations)99thenumberofforeigninvestmentswasverylimitedduetothemistrustofinvestorsinthedevelopingStates’systemsofjustice(andtotheinternationalformof relief given by diplomatic protection); (ii) until the end of the 20th century theactivity of ICSID (and the existence of investment arbitration in general) was verylimited;100and,asaconsequence, (iii)Statesandarbitral tribunalshaveassumedanapproachaimedatincentivizingtherecoursetointernationalinvestmentarbitration.In light of the three above considerations,wewill now try to analyse the historicalprocessatthebasisofthe jurisdictional fragmentationoccurredwithin internationalinvestmentlaw,priorfromtheperspectiveofStatesthatnegotiatedBITsandfurtherlookingattheapproachassumedbyarbitraltribunalsinassumingjurisdiction.

From the first point of view, the resolution of disputes between States andforeigninvestorswas,infact,untilthesecondhalfofthe20thcentury,reservedtothejurisdictionofnationalcourts.Onlywhentheinvestor,havingbeforeexhaustedalltheavailable local remedies, did not receive any sort of satisfaction, the State ofnationalityoftheinvestorhadtherighttoseekinternationalreliefthroughdiplomaticprotection. 101 Such form of international protection is a right of the State ofnationalityofthe investorwhoenjoysmaximumdiscretion inmakingrecoursetoorwaiving it,evenonthebasisofpoliticalconsiderations.Furthermore,theruleofthepriorexhaustionoflocalremediesrenderedtheprocessveryslow.Itis,inthisregard,sufficienttothinkthatthewholeproceedings(i.e.nationalandinternational)relatedtothewell-knownBarcelonaTraction102casehastaken22years.103Whatstatedaboveshall be summed to the circumstance that, after World War II, developing Statesclaimed their full sovereignty on natural resources and therefore consideredthemselves entitled to expropriate investments without any sort of protection forinvestors (i.e. without paying a prompt, adequate and effective compensationaccording to the so-calledHull Formula). Moreover, such States – applying the so-calledCalvoDoctrine104–requestedtoinsertininvestmentcontractsaso-calledCalvoClause,pursuanttowhichtheyrenouncedtoanyformofdiplomaticprotection.105

99SeeAlexandrov(2006)(n.9),387.100 See Bernardini, Journal of World Investment (2001), where it is said that: “The experience,particularly in the 1960s and 1970s, of one of the sectors of economic activity which has mostsignificantlymobilizedtheindustrializedworld’sresourcestowardsdevelopingareas–theexploitationofminingresourcesand,morespecifically,petroleum–showshowdifficultitwasduringthisperiodtoreconciletheparties’differentobjectives”.101OntheconceptofdiplomaticprotectionseeConforti(2013)(n.7),248andss.102The reference goes to the Barcelona Traction, Light and Power Co., Ltd. (Belgium v. Spain),Judgement,5February1970ICJRep.4,35caseandtotherelatednationalproceedings.103SeeTonini(2011)(n.7),9-10.104Such a doctrinewas ideatedby theArgentiniandiplomaticCarlosCalvo in the secondhalf of the19thcentury.105OntheCalvoDoctrine,seeConforti(2013)(n.7),250,statingthattheeffectoftheCalvoClauseinaninvestmentcontractshallbeminimized,inlightofthefactthatsuchcontractsweresignedbyinvestorsand host States and investors could not bind their State of nationality, that were the only entities

48

Fromtheabove it isevident that foreign investorscarryingoutbusinesses indeveloping States enjoyed very little protection and, therefore, they where notincentivized in investing abroad. For this reason, in order to attract investments,States have started to enter into BITs with very broad standards of protection,definitionsofinvestmentsandprovidingforaneutralarbitrationtobestarteddirectlybyinvestorsinoneofthedifferentforaprovidedtherein.ThishasbeendescribedbyProf. Sacerdoti as a “reaction” to the ICJBarcelona Traction decision, according towhich the State of nationality of shareholders was not entitled to seek diplomaticprotectionfordamagessuffereddirectlybythecompany(thatactuallyperformedtheinvestment) and indirectly (i.e. loss of value of the shares) by shareholders.106It isthereforeclear,ifitistruethat–aswehaveseenabove–themainsourcesofparallelproceedingsarerelatedtothedefinitionsof“investors”and“investments”containedin BITs, that the first reason leading to parallel proceedings is the same States’willingness to attract foreign investments through BITs very favourable to foreigninvestors(andsettingforthvariousforaforthesettlementofinvestmentdisputes).Inthis regard it is worth quoting Anthony Sinclair’s words, stating, with concern tooverlappingjurisdictionininternationalinvestmentlaw,that“theinherentflexibility–orpatentundesirability–ofthispotentialoverlap(dependingonwhichsideyousit)istheproductofamoderntreatyregimethattypicallycouplesaverybroaddefinitionofinvestmentsdirectlyorindirectlyheldwithfrequentlynomorethanaformalistictestofnationalitytoestablishstanding”.107

Inregardtothepracticeofarbitraltribunals,itisworthbeginningtheanalysisby looking at the very limitednumber of investment cases until the endof the lastcentury. It is here sufficient tomention that “the first ICSID casewas registered in1972.ThefirstICSIDcaseunderaninvestmenttreatywasregisteredin1987…attheendof1994,ICSIDhadbeforeitonlythreecasesbetweenforeigninvestorsandhostgovernmentsunderinvestmenttreaties.ThefirstyearinwhichmorethanfiveICSIDcaseswereregisteredwas1997”.108Howcanthisdatebejoinedwiththecircumstancethat57casesin2013109and42in2014110arisingfromarbitrationclausescontainedininternationalinvestmenttreatieshavebeeninitiated?

First of all, the data regarding the very high number of BIT arbitrations areclear evidence that, as of today, investment arbitration is considered (and, in theopinionofthepresentauthor,asitwillbeseenbelow,stillis)themostreliablemeansfortheresolutionofdisputesbetweenStatesandforeigninvestors.

entitled to make recourse to diplomatic protection. See also de Gramont, Transnational DisputeManagement(2006),18.106Sacerdoti,AppealsMechanisminInternationalInvestmentDisputes(2008),133.107Sinclair(2005)(n.67),361.108Alexandrov(2006)(n.9),387.109SeeUNCTAD,RecentDevelopmentsinInvestor-StateDisputeSettlement,publishedon1April2014.110SeeUNCTAD,RecentTrendsinIIASandISDS,publishedon19February2015.

49

Trying to analyse the reasons for the significant growth of the recourse toinvestmentarbitration(andinparticulartoICSID),oneofthemainofthemseemstobe (on the basis of an analysis of the approaches taken by tribunals at thejurisdictionalstageofproceedings),111theveryflexibleapproachtakenbytribunalsinassumingjurisdiction.112Thereferencegoes inparticulartotherecoursebytribunalsto the doctrine of “piercing the corporate veil”, i.e. the determination of thenationality of a company through the ascertainment of the nationality of acorporation’spredominantshareholders.113

Inparticular,asdemonstratedbythecasesthatwillbereportedbelow,froman analysis of the jurisdictional awards it emerges that: (i) tribunals have used topiercethecorporateveilwhennecessaryinordertoassumejurisdiction;and(ii)whenthe claim has been brought by a shell company, tribunals do not have pierced thecorporate veil, even if the actual beneficiary of the investment had the samenationalityofthehost;and(iii)incaseofclaimsstartedbythecompanyincorporatedin thehostState,only in twocasesTribunalshaveacceptedtopiercethecorporateveil,while in all theothers they stoppedat the first level of control. Sucha flexible(and often incoherent) approach has been justified on the basis of a literalinterpretationoftherelevantBITs.

Asanexampleoftheapproachdescribedunder(i)itisworthmentioningoneoftheoldestICSIDcases,SOABIv.Senegal,114whereaPanamaniancompanyownedthe locally incorporatedcompany’s shares; suchPanamaniancompanywas, in turn,owned by Belgians. Panama was not a signatory of the ICSID Convention andtherefore the respondent State argued that the Panamanian company was notentitledtotheprotectionoftheICSIDConvention.TheTribunal,onthecontrary,heldthatultimatecontrolwassufficienttoestablishitsjurisdiction.TheTribunalstated“itisobviousthat,justasahoststatemaypreferthatinvestmentsbechannelledthroughacompanyincorporatedunderdomesticlaw,investorsmaybeledforreasonsoftheirown to invest their funds through intermediary entities while retaining the samedegreeofcontrolover thenationalcompanyastheywouldhaveexercisedasdirect

111SeeDolzer,Schreuer,Principlesof International InvestmentLaw (2012),50andss.,NadakavukarenSchefer,InternationalInvestmentLaw(2013),113andss.,Sornarajah,TheinternationalLawonForeignInvestment (2010), 323 and ss., McLachlan, Shore, Weiniger (2007) (n. 44), 131 and ss. See alsoBernardini,inGlobalreflectionsoninternationallaw,commerceanddisputeresolution–LiberamicoruminhonourofRobertBriner(2005),103andss.112Thiscouldbesociologicallyexplained,usingthewordsofHale,BetweenInterestsandLaw(2015),11,by saying that “[d]ispute settlement institutions (be they domestic, intergovernmental, ortransnational)havealmostneverrunagainsttheinterestsofdominanteconomicgroups”.113See Kryvoi, Global Business LawReview (2011), 173,who has defined the “piercing the corporateveil”as“disregardingtheseparationbetweenentitiesorganizedincorporateformwithlimitedliabilityof shareholders”. See also Lyons, Syracuse J. Int’l & Comp. Law (2005-2006), 525. For a generalapproachtothe“piercingthecorporateveil”doctrineseeBeyer,MarylandJournalofInternationalLaw(1990),233andss.114SociétéOuestAfricainedesBétonsIndustrielsv.Senegal,ICSIDCaseNo.ARB/82/1,Award,25February1988.

50

shareholders of the latter”.115As a consequence, the Tribunal pierced the corporateveil and asserted its jurisdiction. Such an approach has been applied by otherTribunals whenever it has been necessary to pierce the corporate veil in order toassumejurisdiction.116

Moving to the approach mentioned under (ii) it shall be noted that severaltimes,whenassumingjurisdictionincasesbroughtbyholdingcompanies(mentionedin paragraph 1.1.3), Tribunals should have had to decline jurisdiction if they hadappliedthepiercingthecorporateveildoctrine.Inthisregarditisworthmentioning,inter alia, the Tokios Tokeles 117 and Rompetrol 118 decisions, where the ultimatecontroller of the investment was a national of the respondent State and severalauthorshaveconsideredtheassumptionofjurisdictionasanallowanceofanabuseoftheinvestmentarbitrationsystem.InthisregardthestrongdissentingopinionissuedbyProf.ProsperWeil in theTokios Tokeles decision is a significant exampleof suchcriticisms.119

Notwithstanding such criticisms, in the majority of cases Tribunals haverefusedtopiercethecorporateveilinordertoavoiddecliningtheirjurisdictionunderacertainBIT.120Thiscouldleadtoasituation(alreadyanalysedinparagraph1.1.3)inwhichvariouscompaniesofthesamegroup(thatrepresentthesameinterests)bringtwoseparate,butsubstantiallyidentical,claimsarisingfromthesamefacts.

Astothesituationmentionedunder(iii),theonlytwocasesinwhichaTribunalhas pierced the corporate veil in order to decline jurisdiction have been TSA v.Argentina121andNationalGasv.Egypt.122Inthefirstofthesecases,theclaimantTSAwasanArgentineancompany.TSA’scontrollingcompanyTSIwasincorporatedinTheNetherlandswiththesolepurposetomakethedisputedinvestmentandtakebenefitoftheNetherland–ArgentinaBIT.ThemajorityofTSI’scontrollerswereFrenchandArgentinian nationals. In order to decline jurisdiction pursuant to the lack of thenationalityrequirementsetforthintheDutch–ArgentinianBIT,theTribunalhadtopiercethecorporateveil.InthiscasetheTribunaldidso,statingthat“onlyagenuinely

115Ibid.,para.37.116See,e.g.,Mr.FranzSedelmayerv.TheRussianFederation(throughtheProcurementDepartmentofthe President of the Russian Federation), Arbitration Award of 7 July 1998 rendered at the Place ofArbitration Stockholm, available at www.investmentclaims.com/decisions/Sedelmayer-Russia-JurisdictionandFinalAward-7Jul1998.pdf.117TokiosTokelesv.Ukraine,ICSIDCaseNo.ARB/02/18,DecisiononJurisdiction,29April2004.118TheRompetrolGroupN.V.v.Romania,ICSIDCaseNo.ARB/06/3,DecisiononJurisdiction,18April2008.119TokiosTokelesv.Ukraine,ICSIDCaseNo.ARB/02/18,DissentingOpinionofProsperWeil.AccordingtoProf.Weiltheoriginofcapitalsshallbehighlyrelevantintheassessmentofjurisdictionpursuanttothe ICSIDConvention. If thecapitalscomefromtherespondentState, theclaimant isnotentitledtomakerecoursetoICSID.SeeMcLachlan,Shore,Weiniger(2007)(n.44),149andss.120See, e.g., Aguas del Tunari S.A. v. Republic of Bolivia, ICSID Case No. ARB/02/3, Decision onJurisdiction,para.33021October2005.121TSASpectrumdeArgentinaS.A.v.ArgentineRepublic,ICSIDCaseNo.Arb/05/5,Award,19December2008.122National Gas S.A.E. v. Arab Republic of Egypt, ICSID CaseNo. ARB/11/7, Award, 3 April 2014. SeeBlanke,www.kluwerarbitrationblog.com(2014).

51

foreign investment should be protected by the ICSIDmechanism”.123In the secondcase,inwhichthetribunalhasappliedaverysimilarreasoningandreachedthesameconclusionof theTSATribunal, theclaimantNationalGaswasanEgyptiannationalandthefinalcontrolleroftheinvestmentwasalsoEgyptian.Withregardtothesetwocases,itshouldbehighlightedthatapiercingofthecorporateveilhasbeenpossibleonly because the claimantwas a company incorporated in the host State. This hasconsentedtotheTribunalstosearchfortheforeigncontrolrequestedbyart.25(2)(b)ofthe ICSIDConvention.Theresearchfortheforeigncontrol isactuallynotallowedbythesameICSIDConventionwhen,underacertainBIT,theclaimantisanationalofthe other contracting State and not a company incorporated in the host State.124However, it should be noted that inmany other cases (the circumstances ofwhichwere similar toTSA andNationalGas), such asAUCOVEN v. Venezuela,125TribunalshavestoppedtothefirstlevelofcontrolandrefusedtopiercethecorporateveilevenincasesofclaimsstartedbycompaniesincorporatedinthehostState.

Given thewhole discussion above, it is evident that in order to improve thenumberof foreign investments, thepossibilityof recourse to investmentarbitrationhas been broadened, first of all, by States, which have negotiated BITs with verybroad “investors” and “investments” definitions. Tribunals, in turn, have assumed averyincoherentapproachconcerningtheirjurisdictionandhave,onthebasisofBITs’broad wording, very rarely declined jurisdiction due to a lack of the nationalityrequirement.Indeed,asithasbeennotedinaverymeaningfulcommenttotheTokiosTokeles decision, the search for theeffective controlhasbeenusedonly inorder toexpandjurisdiction,butnottorestrictit.126If,asitwillbeseeninparagraph1.4below,tribunals’approachisfullyjustifiableinlightoftherelevantinternationallawrules,itisalsotruethatithasleadtotheproliferationofforaforthesettlementofinvestment123Ibid.,para.118-120.ForageneralcomparisonoftheTokiosandTSAdecisionsseeMartin(2011),(n.82),1andss.124ThisisperfectlyconfirmedbytheawardrenderedinBurimiSRLandEagleGamesSH.Av.RepublicofAlbania,ICSIDCaseNo.ARB/11/18,Award,29May2013.Asitwillbeseeninparagraph1.6below,theTribunal has looked at the foreign control with regard to the claim presented by the locallyincorporatedcompanyEagleGames,while itdidnotdosowithregardtotheclaimfiledbytheshellcompanyBurimiSRL.ThisonthebasisofaliteralinterpretationoftherelevantBITsandoftheICSIDConvention.125Autopista Concesionada de Venezuela, C.A. (AUCOVEN) v. Bolivarian Republic of Venezuela, ICSIDCaseNo.ARB/00/5,DecisiononJurisdiction,27September2001,para.116.Inthiscase,AUCOVENwasoriginallyownedbyaMexicancompanyand–therefore–theConventionwasnotapplicablebecauseMexico is notpartof ICSID.Anyway, the investmentwasbasedonanagreement, a clauseofwhichprovided that in case AUCOVEN ownership should pass to a national of a contracting state, ICSIDjurisdictionwasavailableandtheconsentwasgiven.OnceAUCOVENshareholdingbecameAmerican(even if the indirect ownershipwasMexican), the ICSID tribunal declared to have jurisdictionon thebasis of the principle of party autonomy: the party expressly identified the principle of majorityshareholdingasthecriteriontobeappliedtoidentifyrationepersonaejurisdiction.TheyhavechosentosubordinatetheirconsenttoICSIDarbitrationtonoothercriteria.Thetribunalwasnotempowered–according to the Convention – to change the agreement of the parties. The tribunal furthermorerefused to consider Icatech (AUCOVEN American shareholder) as a convenience corporation,considering that it has become shareholder of AUCOVEN various years prior to the arising of thedispute.126SeeSavarese,Rivistadell’arbitrato(2005),387and389.

52

disputesandtotheriskofparallelproceedingsandconflictingawards.InthisregarditisworthcitingwhathasbeenstatedbyGaillardandPinsolle:“Withtheproliferationof complex deals and the corresponding proliferation of a related contracts andagreements drafted in a different manner, there is room for playing with parallelproceedingsthatcanreallymakethedifferenceontheoutcomeofthecase”.127

In conclusion, if tribunals’ approach has probably given a contribution inreachingtheobjectiveofimprovingthenumberofforeigninvestments,128itisevidentthat,aswehaveseenintheintroductiontoSection1,ithasgeneratedsomemistrustin the investment arbitration system. Indeed, such an approach seems to struggleagainstseveralpolicyconsiderationsthatareessentialforthesurvivalofanymethodof dispute settlement. Such policy considerations will be analysed in the followingParagraphs.

1.3 Policyconsiderationsagainstparallelproceedings

Inthe1599caseFerrerv.Arden,129LordCokemadeaclearstatementinfavourof finality and consistency and against themultiplication of proceedings (involvingsame facts, purposes and interests). He stated that “[f]or it hath been well said,interest reipublicae,ut sit finis litium;otherwisegreatoppressionmaybedoneunder

127Gaillard,Pinsolle,inTheArtofAdvocacyinInternationalArbitration–SecondEdition,174andss.128 See Bernardini, (2001) (n. 100), 236, who – referring to the “denationalization” or“internationalization” of investment contracts has stated that “It is amatter of common experiencethat such techniques have shown their efficacy thanks to the particular dispute settlementmethodchosen by the parties” (i.e. investor – State arbitration). This has been because “the internationalarbitrator has given full effect to the above-described clauses in accordancewith the parties’ (or, atleast,theprivateinvestor’s)intent.ThesameAuthor,at245,statedthat“BIT’sprovisionsinthefieldofdispute settlement through international arbitration represent an effective protection of theinvestment”. It is therefore likely that the possibility to make recourse to this means of disputesettlement has incentivized the number of foreign investments. This idea is fully accepted by theEuropeanFederationfor InvestmentLawandArbitration.SeeEFILA(2015)(n.7),3.SeealsoMeyers,works.bepress.com/Daniel_meyers/2(2008),5-6,statingthat“Intheabsenceofareliableandefficientmechanismfortheresolutionofforeigninvestmentdisputes,theinternationalcommunityfearedthatprospective investorswould be discouraged from investing abroad… The absence of a reliable legalstructuretoprotectforeigninvestmentswasviewednotonlyasanimpedimenttoforeigninvestmentitself, but also to economic development and the multitude of benefits associated therewith. Toovercomethis impediment,theinternationalcommunityestablishedwhathastodaybecometheITA(i.e.investmenttreatyarbitration)system.Accordingly,itisfairtosaythattheverypurposeoftheITAsystem is to encourage foreign investment and thereby to further economic development in hostStates. Indeed, this purpose is recited in the preambulary provisions of nearly every bilateralinvestment treaty… In this way, the creation of the ITA system was based on two fundamentalpremises.First,thatincreasingthelegalprotectionsforforeigninvestmentswouldincreasethevolumeofforeigninvestments.Andsecond,thatincreasingthevolumeofforeigninvestmentswouldincreaseeconomicdevelopment”.ThesameAuthorhasnotedthatthereisnocertainevidenceofthefactthatthegrowingnumberof investmentshasbeendue to thedevelopmentof the investment arbitrationsystem.ForapositiveopinionontheinfluenceofBITsonthenumberofforeigninvestmentsseealsoGeiger, Appeals Mechanism in International Investment Disputes (2008), 25. For sure, according toMeyers, there isnoevidenceof the fact thatwith thedevelopmentof investmentarbitration foreigninvestmentshavedecreased.ForacontraryopinionseeHallward-Driemeier(2003),1andss.129VICoke7a.OnthispointseeHarnon,IsraelLawReview(1966),542-543.

53

colourandpretenceof law; for if there shallnotbeanendof suits, thena richandmaliciousmanwouldinfinitelyvexhimwhohathrightbysuitsandactions;andintheend (because he cannot come to any end) compel him to yield to his charge andvexationandtoleaveandrelinquishhisright;allwhichwasremediedbytheruleandreasonof theCommon law, theneglectofwhich rule…hathwith itbrought in fourgreat inconveniences: 1. Infiniteness of Verdicts, Recoveries, and Judgments in oneandthesamecase.2.SometimescontrarietiesofVerdictsandJudgmentsoneagainsttheother.3.Thecontinuanceofsuitsfortwenty,thirty,andfortyyears,totheutterimpoverishingoftheparties.4.AllthesametendethtothedishonouroftheCommonLaw, which utterly abhorreth infiniteness, and delaying of suites, wherein is to beobservedtheexcellencyoftheCommonLaw;fortherejectionthetrueinstitutionofitdoth introduce many inconveniences, and the observation thereof is alwaiesaccompaniedwithrestandquietness,whichistheendofallhumaneLaws."

Thisstatement,archaicinitswordingbutstillveryactualinitsmeaning,infactreflectsthestatusofall legalsystems,whereconsistencyandfinalityareconsideredto be fundamental and irrevocable values.130It is not a case, therefore, that themajorityofinvestmentlawscholarscallfortheapplicationofsuchprinciples.131

Inparticular,threemainpolicyconsiderationsappeartobeatthebasisoftheneedforconsistencyand/orfinality:132(i)ensuringthereliabilityandthelegitimacyofthe adjudication process and the principle of legal certainty; (ii) protecting judicialeconomyandefficiency inthedecisionmakingprocess,thusavoidingvexationsandharassment for the defendant State; and (iii) the necessity to ensure that disputescometoanend,notwithstandingthedesiretoascertainthetruthwithregardthecaseathand. Wewilldealwithallthesepolicyconsiderationsseparately.

1.3.1 Reliabilityandlegitimacyoftheadjudicationprocessandtheprincipleoflegalcertainty

Investment arbitration is by definition a public form of dispute resolution.133

Indeed, vital areas of the life and economyof a State are often conditionedby thesettlementof international investmentdisputesandthisputs investmentarbitration

130In1966Prof.Harnonalreadystated“theneedforfinalityofjudgementisrecognizedbymany,ifnotall,systemsoflaw”.SeeHarnon(1966)(n.129),539.Similarly,Pinos,OsgoodeHallLawJournal(1988),718, stated that “the final resolution of disputes therefore can be considered to be central to theeffectivefunctioningofthesystemofjustice”.131V. Kaufmann-Kohler, in Precedent in Investment Arbitration (2008), 136 and ss. For a contraryopinion,seeSchultz(2013),19,whohasstatedthat“anossified,consistent,predictable,badregimeisworse than a loose, inconsistent, bad regime, because the former creates greater constraints fordecision-makersinindividualcases”.132As noted by Gaukrodger (2013) (n. 46), 29 and ss., such policy considerations have often beenunderestimated. Douglas (2009) (n. 64), 455 and ss., has underlined that investment tribunals haveactedasifthepolicyconsiderationsagainsttheriskofconflictingoutcomesarenottheirproblem.133See Van Harten, Investment Treaty Arbitration and Public Law (2007), 1 and ss., De Brabandere,InvestmentTreatyArbitrationasPublicInternationalLaw(2014),1andss.

54

in a position of very high visibility. Therefore it is worth analysing the influence ofparallel proceedings on the perception that States and public opinionmay have ofinvestmentarbitration.

This task may be analysed through the analysis of the possible dramaticoutcomesofparallelproceedingsonthereliabilityoftheadjudicationprocessandonthe principle of legal certainty. In this regard, it is worth recalling the CME134andLauder135cases,brieflymentionedabove.Asalreadystated,notwithstandingthatthefacts at the basis of the two claims were perfectly the same,136the two tribunalsreached completely opposite solutions on the issues of expropriation, fair andequitabletreatmentandfullprotectionandsecurity.IntheCMEcase,indeed,theSCCTribunal (the conclusions of which were upheld by the Sweden’s SVEA Court ofAppeal) found a violation of all thementioned standards,while thead hoc LondonTribunalintheLaudercasestatedthatnoviolationoccurredinthepresentcase. It shall be mentioned that the outcome of parallel proceedings is notnecessarily so dramatic. In the disputes started byYukos’smajority shareholders,137thesameTribunalheardthethreecasesandissued–onthesameday–threealmostidenticalawards.Inthiscase,aswellasintheotherdisputesrelatedtotheYukossaga(i.e. the cases started by minority shareholders),138it is possible to say that - inconcrete-Tribunalshavetriedtogiveareasonablepracticalsolutiontothe issueofparallelproceedings,at least taking intoaccount the factsand theoutcomesof therelateddisputes.

134CMEv.CzechRepublic,UNCITRAL,SCCPartialAward,13September2001135RonaldS.Lauderv.CzechRepublic,UNCITRAL,FinalAward,3September2001136 The CME and Lauder litigations regarded the granting of a TV license to Central EuropeanDevelopmentCorporation (CEDC),avehiclecompanyof theDutchcompanyCMEand theAmericancitizenMr.Lauder,forestablishinganewprivatetelevision(TVNova)inCzechRepublic.Afterseveralbureaucraticproblems,TVNovareceiveditslicence,butin1995achangeinCzechMediaLawstronglyaffected CME and Lauder’s investment (giving advantage to the business of the Czech citizen Dr.Zelezny, a former partner of Mr. Lauder). As already stated, two claims were started (one by CMEaccordingtotheDutch-CzechBITbeforetheSCCandoneadhocinLondonbyLauderaccordingtotheUS-Czech BIT) and the Tribunals reached completely opposite conclusions. For a more detaileddescriptionofthefactsseeFranck,FordhamLawReview(2005),1559-1668.137YukosUniversalLtd.(IsleofMan)v.RussianFederation,PCACaseNo.AA227,Awardof18July2014,HulleyEnterprisesLimited (Cyprus)v.TheRussianFederation,PCACaseNo.AA226,Awardof18July2014,andVeteranPetroleumLimited(Cyprus)v.TheRussianFederation,PCACaseNo.AA228,Awardof18July2014.138Quasar de Valores and others v. The Russian Federation, SCC Case No. 24/2007, Award of 20 July2012,RosInvest UK Ltd v. The Russian Federation, SCC Case No. V079/2005, Award of 2 September2010.ItshouldbenotedthattheYukossagainvolvedalsoacasebeforetheEuropeanCourtofHumanRights,OAONeftyanayaKompaniyaYukosv.Russia,App.No.14902/04,ECtHR,Judgement(Merits)of20 September 2011, and a ICC commercial arbitration,Yukos S.a.r.l. v. Rosneft, which involved alsoproceedingsbeforeDutch,EnglishandUSCourts.AsexplainedbyGiorgetti(2015(n.5),112,inQuasar,“whenreachingitsconclusions,theSCCTribunalreviewedbothYukos[i.e.theproceedingsbeforetheECtHR]andRosInvest.ItexplainedwhyitdisagreedwiththeYukosdecision.ItalsobrieflyreferredtothesimilaritieswiththeRosInvest.TheYukoslitigationisparticularlyinterestingbecausethedifferenttribunals took cognizance of other international courts and tribunals seized of similar and relatedmatters.Theyoften,butnotalwaysagreedwitheachother’sconclusions”.ForananalysisoftheYukosdecisionissuedbytheECtHrseeMcCarthy,JournalofWorldInvestment&Trade(2016),140andss.

55

A similar coordination may be found in the abovementioned Sempra andCamuzzi decisions, where – even if the two minority shareholders brought twoseparateclaims–theclaimants,inaccordancewithArgentina,decidedthatthesameTribunal would have heard both disputes. On the contrary, in the similarcircumstances (i.e. two autonomous claims started by minority shareholders)regarding the alreadymentionedCMS andTotal claims, such coordinationwas notpresent.TheTotalTribunal–notwithstandingthefactthattheclaimbefore itarosefromaparticipationof theclaimant in theArgentiniancompanyTGN(i.e. thesamecircumstancethatgiverisetotheCMSclaim)–madereferencetotheCMSdecisionbut reached opposite conclusions on the alleged violation of fair and equitabletreatment.139

In lightof theabove,due to the lackofageneral rule for thesolutionof theproblem,thepotentialforconflictingoutcomes,aswellastheriseofcosts,thelackofefficiency and, last but not least, the lack of legal certaintymakes the existence ofparallelproceedingsaveryhighbarriertothesurvivalofinternationalinvestmentlawandarbitration.140 It is not casual, indeed, that the risk of conflicting outcomes has ledcommentators to strongly criticize investment arbitration and to talk about itslegitimacy crisis. 141 Carver has stated that conflicting outcomes are a “totallyunacceptable result (…) You cannot have any working system of arbitration whichproducestwodiametricallyoppositeresultsatanytimeonexactlythesamesubjectmatter (…) It may undermine the whole future of bilateral investment disputesettlement. Itmayundermine thewhole futureof investment arbitrationunlesswecan find a solution to this”. 142 Similarly, Susan Franck stated that “prominentpractitionershavenotedthat‘anysystemwherediametricallyopposeddecisionscanlegallycoexist cannot last long. It shocks thesenseof ruleof lawor fairness’.Giventhat issuesof legitimacycuttotheheartofutilityofusingarbitration, the literaturemust address the concerns underlying the legitimacy crisis in a meaningful way.Otherwise, conflicting awards based upon identical facts and/or identically wordedinvestment treaty provisionswill be a threat to the international legal order and thecontinued existence of investment treaties” (footnotes and citation omitted,emphasis added).143Finally, andmore generally, Charney has stated that “not only

139SeeGaukrodger(2013)(n.46),43.140Thedramaticeffectsofparallelproceedingsare infactevenmorevisible incases involvingseveralsystems of adjudication, such as the Chevron disputes, involving disputes in US national Courts,EcuadornationalCourts,PermanentCourtofArbitrationintheHague,theDistrictCourtintheHague(assettingasideauthority)andtheInternationalCriminalCourt.CasessuchasthisareoutofthescopeofthepresentbookandwillonlybebrieflyanalysedinChapter3.SeeGiorgetti,JournalofInternationalLaw(2013),787andss.,Donziger,Garr,Page,HumanRightsBrief(2010),8andss.141Sornarajah, (2008) (n. 111),41andss.Fora contraryopinionanddirectanswer toSornarajah, seeJuillardAppealsMechanisminInternationalInvestmentDisputes(2008),81andss.142Carver, JournalofWorld InvestmentandTrade (2004),23. Forananalysisof thepossible reasonsbehindconflictingoutcomesseeSchneiderman(2010),1andss.143Franck(2005)(n.136),1583.

56

may a cacophony of views on the norms of international law undermine theperceptionthatan international legal systemexists,but if likecasesarenot treatedalike,theveryessenceofanormativesystemoflawwillbelost”.144 Giventheabove,oneshallconsiderthat,duetotheitspublicnature,inorderto be considered reliable (and therefore to increase its legitimacy) investmentarbitrationshallmeetandreflectthewishesandneedsofthecommunityonwhichithas influence145. Hence, it is worth considering what States (and investors) expectfrominvestmentarbitration.146Itisourcontentionthat,whengivingtheirconsenttoinvestment arbitration, the normal expectation of the parties – and in particularStates(andthenationalpublicopinion)–is,interalia,that“anissuewillbetriedonlyonce”.147This is in particular true if one considers that the costs of investmentarbitrationsustainedbyStatesarefinallypaidbycitizensand,therefore,thefactthatadisputeisheardtwicemaybeconsideredasawasteofpublicmoney.AsstatedbySusan Franck, indeed, “legitimacy depends in large part upon factors such asdeterminacyandcoherence,whichcaninturnbegetpredictabilityandreliability(…)Coherenceisakeyelementoflegitimacy;itrequiresconsistencyofinterpretationandapplicationofrulesinordertopromoteperceptionsoffairnessandjustice”.148

Inconclusion,inanetworksuchasinvestmentlawandarbitration,whereverybroad standards are contextualized and given concrete significance by thework ofarbitrators,149 the issue of legitimacy, which involves the validity of the powerexercisedby arbitrators,150is crucial, due to the facts thatpublic interest is at stakeand,nowmorethanever,publicopinionisvigilant.Indeed,suchreasoninghasbeenfosteredalsowithregardtotheICJframework,bysayingthat“itisimperativefortheCourt to maintain judicial consistency (…) because intellectual coherence andconsistency is the cornerstone of continuing respect for the jurisprudence of theCourt.Furthermore,thesuccessoftheCourtisdependenttoalargedegreeuponits

144Charney,NewYorkUniversityJournalofInternationalLawandPolitics(1999),699.145Gribnau,ElectronicJournalofComparativeLaw(2002),28andss.146Bekker,HarvardInternationalLawJournalOnline(2013),8,andSalacuse,MakingTransnationalLawWork in the Global Economy – Essays in Honour of Detlev Vagts (2010), 428, give a central role to“parties’expectations”inthecontextofthechallengesfacingtheinternationalinvestmentregime.147Vestal,SaintLouisUniversityLawJournal(1964-1965),31.Generallyspeaking,everytimeonereferstofinalityofdisputes,thepublicinterestisatstake.InthisregardseeHarnon(1966)(n.129),546.148Franck(2005)(n.136),1584-1585.149Bekker (2013) (n. 146), 13-14,has indeed talkedabout investmentarbitrationasa formof “judge-made law” and about arbitrators as “agents of diffusion” of such law. Similarly Schill,www.ssrn.com/link/SIEL-Inaugural-Conference.html (2008), 18 and ss., has talked about the “normgenerative function” of international investment tribunals. In light of these considerations one couldassertthatarbitrators intheinvestmentnetworkdonotonlyresolvedisputes,butrespondtotheso-called “lawexpoundingmodel”,where “the role of judges in the system is toderive the appropriatelegal rule from the values articulated in the constitutions and statutes” (i.e. in, our case, BilateralInvestmentTreaties). For a descriptionof suchmodel seePurcell, California LawReview (1997), 898andss.150Gribnau(2002)(n.145),29.

57

reputation for impartial adjudication and judicial consistency is the most obviousmeansofavoidingaccusationofbias”.151

Intheopinionofthepresentauthortheonlywaytoensurethelegitimacyandreliability of investment arbitration is to apply the legal principles that are felt asnecessaryby theoperators, suchas consistency, coherence, predictability, equality,justice andobjectivity; in otherwords, ensuring legal certainty.152In investment lawandarbitrationthismeansthatparallelproceedingsshallbeavoidedand–iftheyarenotavoidable–thereshallbeageneralruleaimedatmanagingtheproblemthatmayarise from the existence of two proceedings between the same substantial parties,arisingfromthesamefactsandtheclaimantsofwhichhavethesame interestsandpurposes.

Only when operators will found a way tomanage this problem, investmentarbitrationtribunalswillgettheirfulllegitimacyasadjudicators.153

1.3.2 Judicial economy and the need for efficiency in the decision makingprocess

Judicial economy is one of the most mentioned standards regarding the

management of processes by judges, as well as a canon that should inspire thedraftingofprocedurallaws.154Generallyspeaking,itcanbesaidthatjudicialeconomyis seen in national systems as implying two main aspects: saving time and savingmoney.

Fromaninternationalperspective,judicialeconomyisveryoftenmentionedinWTOlitigation,wherepanelsexercisesucha“practicebywhichtheyrulenottoruleoncertainofthelitigants’legalarguments,deemingtheseunnecessarytosolvingthedispute at hand”.155In the US – Wool Shirts and Blouses case, the Appellate Bodystatedthat“panelsmaynotaddressanyissuesthatneednottobeaddressedinorderto resolve thedisputebetweentheparties”.156In this regard it shouldbenotedthat

151Ovchar,BondLawReview(2009),25.TheAuthorhasinparticularreferredtowhathasbeenwrittenbyHigginsinProblemsandProcess:InternationalLawandHowWeUseIt(1994),202.152Ibid., 42 and ss. Theprominent roleof consistency in investment arbitration is also recognizedbyArticle2oftheInternationalLawInstituteResolutionof13September2013(TokyoSession)onLegalAspectsofRecoursetoArbitrationbyanInvestorAgainsttheAuthoritiesoftheHostStateunderInter-State Treaties, stating that “Consistency of solutions in investment arbitration contributes to legalcertaintyforallactorsinvolved.Thequestforconsistencydoesnotrequirethemechanicalapplicationof prior practice without regard to the particular circumstances of the case or the need for theinterpretation and development of the law”. The last sentence gives a central role to arbitrators inensuringconsistencyininvestmentarbitration.Suchrolewillbedeeperanalysedbelow.153SeeVestal(1964-1965)(n.147),33-34,andPinos(1988)(n.130),718.154With regard to the duty of legislators to ensure a fair process seeNigro, Prosperi, L’irragionevoleduratadeiprocessi(2009),35-37.155Busch,Pelc, InternationalOrganization (2010),257.TheAuthors further state that “thispractice isimportantnotonlyforthelitigants,whofrequentlyappealitsuse,butforthemembershipasawhole,sincejudicialeconomylimitsthescopeofthecaselawthatresults”.156WTODocumentWT/DS138/AB/R,25-26.ConcerningjudicialeconomyattheAppellateBodystage,seeAlvarez-Jimenez,JournalofInternationalEconomicLaw(2009)393andss.

58

WTO rules (as interpreted by the Appellate Body) give a very broad discretion topanels in applying judicial economy; therefore, as statedbyBusch andPelc, panels“needtostrikeabalancebetweengreater legalism(that is, ‘rigidity’),whichaimsatfurtheringcompliance,andmoreflexibility(thatis,‘stability’),whichhelpsattractandretainmembers”.157 Prof. Palombino has stated that “the principle of judicial economy fromguiding and affecting the international judge’s activity (…) belongs, in fact, to thegeneral canons of adjudication – that is, those canons which are inherent in thejudicial function and that the judge takes into account in the exercise of his duties,regardlessofwhatthewrittenprocedurallawestablishes.Accordinglythejudgeisinanycaseexpectedtooperateinconformitywiththeprincipleofjudicialeconomyandto use it in a proper way, namely one that does not compromise the dispute’sresolution and/or the establishment of the true state of the world. Such acircumstanceisparticularlyevidentwhere,forreasonsofjudicialeconomy,thejudgelimitsthescopeofthedecision,andthiseventhoughnoprovisionrequiresit”.158 Notwithstandingtheabove,it isworthnotingthatininternationalarbitrationlawthereisnoreferencetotheprincipleofjudicialeconomy.Thisdoesnotmeanthatthis principle shall not influence the arbitrators’ work and that the parties do notexpectthatarbitrationisconductedefficiently.Indeed,timeandcostsarekeyissuesinordertoevaluatetheefficiencyofthearbitrationprocessandefficiencyis,inturn,one of the most debated issues by international arbitration scholars.159Indeed, asconfirmed by the 2015 Queen Mary Arbitration Survey, expenses and longevity ofarbitration are the less attractive characteristics of this method of disputesettlement.160 However,itisworthnotingthat“thereisnoapriorianswertothequestionofhow to make arbitration fair and efficient. Each case depends on its facts”.161Thisconsiderationshiftstheanalysisontheroleofarbitratorsinensuring–onthebasisofthe concrete needs of each case – efficiency and respect of the principle of judicialeconomy.Thisisparticularlytrueincaseofinvestmentarbitration,where–asithasbeenalreadysaid–theveryhighcostsaresustainedbypublicmoney.

157Busch,Pelc (2010) (n.155),259.Bhala, JournalofTransnationalLawandPolitics (1999),48, statedthattherecoursetojudicialeconomyisaproofoftheexistenceofasystemofdefactostaredecisisinWTO.Hestatedthatjudicialeconomyisaprincipleof“selfrestraint”bypanels.158Palombino,LeidenJournalofInternationalLaw(2010),910.TheAuthor,at912,underlinesthat“thepresenceoftheprincipleamongthefundamentalcanonsof litigationhasalwaysbeenhighlightedbyscholarsofdomesticprocedurallaw”.Inthisregard,inparticularconcerningthejurisdictionoftheUSSupremeCourt,seeHill,VanderbiltJournalofTransnationalLaw(2008),1195andss.159 See Welser, Austrian Yearbook of International Arbitration (2014), 149, Kirby, Journal ofInternationalArbitration(2015),689andss.160The 2015 School of International Arbitration Survey, entitled Improvements and Innovations inInternationalArbitrationisavailableathttp://www.arbitration.qmul.ac.uk/research/2015/.161SeeFellas,PLI’sCourseHandbook(2007),16.

59

Thetaskofarbitratorsisthereforetomakeabalancebetweendueprocessandefficiency;162theyhave toensure that, in concrete, eachpartyhasonce the right topresentitscasebut–atthesametime–theyhaveadutytoavoidwastesofmoneyand time.163As a confirmation of such a general duty it is worth mentioning theprovisionofSection33of theEnglishArbitrationAct1996, stating that the tribunalshall, onone side,giveeachpartya reasonableopportunity toputtinghis caseanddealingwiththatofhisopponent,and,ontheotherside,adoptproceduressuitabletothe circumstances of the particular case, avoiding unnecessary delay of expense.164UNCITRAL Rules, at Article 17, similarly provide that “[t]he arbitral tribunal mayconductthearbitrationinsuchmannerasitconsidersappropriate,providedthattheparties are treated with equality and that an appropriate stage of the proceedingseachpartyisgivenareasonableopportunitytopresentitscase.Thearbitraltribunal,inexercisingitsdiscretion,shallconducttheproceedingssoastoavoidunnecessarydelayandexpenseandtoprovideafairandefficientprocessforresolvingtheparties’dispute”. Inthecontextofparallelproceedingsthismeansthatarbitratorshaveadutytoensure that a dispute is tried only once, therefore avoiding conflicting outcomes,useless duplication of proceedings and exaggerated costs, and ensuring goodadministrationof justiceinthearbitralproceedings.Hence, it isadutyofarbitratorstomakeeffortsinordertograntfinalityofawardsandtoavoidre-judgingadisputethathasbeenalreadyjudgedorthatisbeingjudged. ThiswouldalsoensurethatthedefendantStateisnotvexedandharassedbythemultiplicationofproceedings. Inthe lackoftheapplicationofthefinalityrule,acompany would be able to structure its business so as to be able to sue a State anumberofdifferentclaimsonexactly(oratleastsubstantially)thesameclaim.165Itisin fact arguable that, when accepting to submit jurisdiction of arbitrators forinvestmentdisputes,Statesdidnotexpect tohave toparticipate tomore thanoneproceedingconcerningthesamedispute.Therefore, if it istruethatarbitratorsshallkeep the legitimate expectations and the rights ofboth parties into account,166it isalsotruethattheycannotallowaclaimanttomultiplyadisputeinordertogetmorechances of success. As stated by Zachary Douglas “an appeal to basic notions ofjustice would surely suffice to refute any suggestion that such a state of affairs isacceptable as a matter of principle. A host state cannot be expected to defend abarrageofconcurrentorconsecutiveclaimsrelatingtopreciselythesameprejudicetoasingleinvestment.Norcanitberightforahoststatetodefendconsecutiveclaimsin162With regard to the duty of arbitrators in the case management see Waincymer, Procedure andEvidenceinInternationalArbitration(2012),78andss.163Fortier,ICCACongressSeriesno.9(1999),395-399.164Similarly,article19oftheUNCITRALModelLawgivestotheTribunalthepossibilitytoconductthearbitrationinsuchmannerasitconsidersappropriate.165SeeVestal(1964-1965)(n.147),34.166SeeBekker (2013) (n. 146),8.Forageneralanalysisof theconceptof legitimateexpectations seeMerusi, Buona fede ed affidamento nel diritto pubblico (2001), 21 and ss. and Carbone, Promessa eaffidamentoneldirittointernazionale(1967).

60

relation to the same investment by different members of the group of claimantcompaniesuntilanawardfavourabletothatgroupisprocured”.167 1.3.3 Fairnessandfinality

Apossibledefenceof theexistenceofparallelproceedingscouldbe that thecelebration ofmore thanoneprocess related to the same facts is functional to theachievementoftruthandjusticewithregardtothedisputeathand.168 This consideration calls into play general considerations regarding the scopeand the aim of a process (and of an arbitration). An adjudication proceeding is notaimed,infact,atachievingtheobjectivetruth,butonlytoascertainaprobabletruth.Such a probable truth is related to the knowledge and information available to thejudges/arbitrators and has – by definition – a dialectical and uncertain character,involving, for its same nature of ex post ascertainment of facts a certain degree ofsubjectivitybytheadjudicativebody.169Anylitigationprocessisthereforefallibleandthegoalofcompletecertaintyinaprocessisnotreachable.170 It is not a case that systemsof civil procedure are “not designed to produceabsolutecertaintyofthetruth inanygiven litigationor inaseriesof litigations.Theusual burden of proof standard in civil cases is the preponderance of the evidencetest”.171Thekindofanalysisthatjudgesandarbitratorscarryoutisaformofhistoricalinvestigation aimed at ascertainingwith the highest degree of probability the factsthat happened and to integrate them into legal categories; this process involves acertain degree of subjectivity and is not free from being conditioned by thearbitrators’ personal and juridical backgrounds. Hence, the question is, once anarbitration panel has conducted a proceedings respecting all the mandatoryprocedural rules (ensuring fairness and equality of the parties), why should theproceedingsbe repeated “whenno subsequent litigationeitherwillor is intended todeterminetheabsolutetruth?”(emphasisinoriginal).172 In light of the above, we can therefore assume that, if the scope of anadjudicationprocessistoachievethehighestpossibledegreeofcertainty,thedutyofarbitrators is to ensure, before deciding a dispute, that each party has the fullpossibilitytopresentitscase(andtogiveevidenceofitsassertions).Thismeansthatarbitratorshavetoensurethatduringtheproceedingsdueprocessisrespected.173Inthisregarditshouldbenotedthatdueprocessandtherighttobeheardareensured

167Douglas(2009)(n.64),309.168SeeHarnon(1966)(n.129),542(who–anyway–criticizessuchaconclusion).169Pastore,http://m.docente.unife.it/orsetta.giolo/Percorsi%20di%20Genere%20-%20Testi%20seminario%20I%20dicembre.doc(2012-2013),4.170Callen,Kadue,HastingsLawJournal(1979-1980),765;Greenebaum,IndianaLawJournal(1969),2.171CallenKadue(1979-1980)(n.170),766.172Id.,767.173SeeFortier(1999)(n.163),398.

61

if, in relationtoadispute,apartyhas the right topresent itscaseone timeandnotseveraltimes. If due process and fairness are respected during a proceeding between twoparties, aduplicationof suchproceeding isnot requiredandmaywellbeprecludedduetotheexistenceofafinalaward/judgementonthedispute.174 Onthecontraryaproblemoffairnessmayexistwhentwoconflictingawardsrelating to the samedispute coexist, due to the fact that it goes against both legalcertainty and the same concept of rule of law if something is deemed lawful andunlawful at the same time. 175 This circumstance renders necessary a rule ofcoordination in order to ensure that no more than one award regulates a certaincontroversybetweentwoparties. In conclusion, using the words of Professor Scott, the Reporter of the FirstRestatementofJudgments,wecouldaskourselves“[w]hyshouldnot[thesearchfor]thetruthprevail?Theanswerisbaseduponpublicpolicy.Theinterestsof[justice]andofthepartiesrequiretheputtingofanendtocontroversies”.176

1.4 Necessityofageneral remedy forensuringconsistencyand finality.Theimpossibilitytofindasolutionatthejurisdictionalstage:thecentralroleofarbitratorsandthenecessitytogobeyondpartyautonomy.Planofthenextchapters

Several national law systems have given different answers to the issue of

conflictingjudgments.Iftherearetwoparallelnationalproceedingsandnoneofthemisconcluded,whilecivillawsystemsmechanicallyapplythelispendensrule,accordingtowhichthejudgesecondseizedshallstayhisproceedingsuntilthefirstseizedjudgerulesonhis jurisdiction,177common lawsystemsuse tomake reference to themorediscretional remedies of forumnon conveniens and anti-suit injunctions. ThismeansthatifanEnglishjudgefindsthatthereisaclearlymoreappropriateforumthatmayservebetterthanhimthe interestof justice,hewillstay itsproceedingsandasktheplaintiff to refer to that judge.On the contrary, if theEnglish judge finds tobe themost appropriate forum, he will issue an anti-suit injunction, an order aimed atrestrainingapartyfromcommencingorcontinuingajudgement.

Incaseoneofthetwoparallelproceedingsisconcluded,almostallthenationallawsystemsapplytheruleofresjudicata,accordingtowhich,onceadisputebetweentwo parties is decided by a determination that is considered final as to the rights,

174It is not a case that the very authoritative Italian scholar Piero Calamadrei (Istituzioni di dirittoprocessualecivilesecondoilnuovocodice(1941),125)hasstatedthatanydecision/awardmaynotbere-judgedonceithasbecomeresjudicata,duetothefactthatit,bydefinition,facitius(madelaw).Oncetheawardisissued,itisvalidnotwithstandingitcouldbeconsideredasnotreflectingthetruth.InthisregardseePalombino,Glieffettidellasentenzainternazionaleneigiudiziinterni(2008),89andss.175Palombino(2008)(n.174),90andss.176Scott,HarvardLawReview(1942),1.177See,e.g.,art.29oftheEURegulation1215/2012.

62

question and facts involved in the dispute, a re-litigation of the same matter isbarred.178

In the very unlikely hypothesis that two judgements concerning the samedisputeandbetweenthesamepartiesareissued,allnationallawsystemshavefoundsolutions aimed at avoiding the coexistence of conflicting outcomes. Anyway, thedifferent systems have applied different solutions. As it has been demonstrated,179oftenthesesolutionsdisregardanyevaluationonthesubstanceofadecisionandgiveprecedence to the first or second issued decision as a matter of fact. In Italy, forexample,theseconddecisionalwaysprevails,whileincommonlawcountries,onthecontrary,thevaliddecisionisthefirstone.180Inothersystems,likeFrance,theCourdeCassation will decide which decision to render invalid.181Furthermore, it should beaddedthatinsomeparticularcases,suchas(inItaly)thefragmentationofadisputeconcerningdamagesarising fromacaraccident,182national judgeshaveapplied thedoctrineofabuseofprocessinordertobarthesecondclaimfromgoingaheadattheadmissibilitystage,evenif–inprinciple–jurisdictionwaspresent.AlltheabovelegalinstrumentswillbedeeplyexaminedinChapters2and3below.

With regard to international arbitration, as amatter of principle one shouldnote that there are no explicit rules aimed at solving the problem of parallelproceedings.Forlogicalreasons,thefirstphaseoftheproceedingswhereitispossibleto try to find a solution to the problem of parallel proceedings is the jurisdictionalstage. Indeed, it is reasonable that, if a case has been already judged or is beingjudged, other arbitral tribunals refuse to hear the same claim as a matter ofjurisdiction.

Nevertheless,asitwillbeexplainedinthisparagraph,acloserlooktotherulesregulating jurisdiction in international arbitration reveals that at the jurisdictionalstagearbitratorshavenothing(or,atleast,less)todoinordertoavoidtheoccurrenceoftwoparallelproceedings.

First of all it should be reminded that arbitrator’s jurisdiction is determined,accordingtotheprincipleofkompetenz-kompetenz,bythesamearbitrators.183Thisisclearlystated,forinstance,byart.41,paragraph1,oftheICSIDConvention,statingthat “[t]he Tribunal shall be the judge of its own competence”. Similarly art. 23,paragraph 1, of the 2010 UNCITRAL Arbitration Rules states that “[t]he arbitral178Gallagher,inPervasiveProblemsinInternationalArbitration(2006),335.179Palombino(2008)(n.174),90.180Ibid., 90-91. The Author mentions some contrary opinion with regard to the approach taken byItaliancourtsthatletprevailthesecondissueddecision.181Incriminaljusticesystems,onthecontrary,oftenthemostfavourabledecisionfortheguiltypersonprevails, on the basis of the principle in dubio pro reo. See, e.g., art. 669 of the Italian criminalproceduralcode.182 See Castaldo,http://www.consiglionazionaleforense.it/site/home/agenda/documento5237.html (2011), 1andss.,Scarselli,Rivistadidirittoprocessuale(2012),1450andss.183On thedeterminationof arbitral jurisdiction seeGotanda,Columbia Journal of Transnational Law(2001) 11 and ss. On the principle of kompetenz-kompetenz see Bachand, Arbitration International(2009),431andss.,Chillakaru,ContemporaryAsianArbitrationJournal(2013),133andss.

63

tribunalshallhavethepowertoruleonitsownjurisdiction, includinganyobjectionswithrespecttotheexistenceorvalidityofthearbitrationagreement”.Therationalebehindtheprincipleofkompetenz-kompetenzisthatarbitratorsareappointedbytheparties and their task is to interpret the arbitration agreement paying onlyconsiderationtopartyautonomyasexpressedinthearbitrationclauseinlightoftherelevantapplicablelaw.

ConsideringthatBITsareinternationaltreaties,arbitratorsshallinterprettheirjurisdictional clausesaccording to theprovisionsofart. 31-32-33of the1969ViennaConvention of the Lawof Treaties (“VCLT”) (which fully reflect customary lawwithregard to treaty interpretation).184Due to the fact that article 32 and 33 VCLT onlycome into play, as supplementary means of interpretation, in cases of particularlyobscure treaty provisions,wewill primarily dealwith the provision of art. 31 VCLT.Accordingtosuchrule:

1. A treaty shall be interpreted in good faith in accordance with theordinarymeaningtobegiventothetermsofthetreatyintheircontextandinthelightofitsobjectandpurpose.

2. The context for the purpose of the interpretation of a treaty shallcomprise,inadditiontothetext,includingitspreambleandannexes:

(a) Anyagreementrelatingtothetreatywhichwasmadebetweenallthepartiesinconnexionwiththeconclusionofthetreaty;

(b) Any instrument which was made by one or more parties inconnexionwiththeconclusionofthetreatyandacceptedbytheotherpartiesasaninstrumentrelatedtothetreaty.

3. Thereshallbetakenintoaccount,togetherwiththecontext:

(a) Any subsequent agreement between the parties regarding theinterpretationofthetreatyortheapplicationofitsprovisions;

(b) Any subsequent practice in the application of the treaty whichestablishestheagreementofthepartiesregardingitsinterpretation;

(c) Any relevant rules of international law applicable in the relationsbetweentheparties.

4. Aspecialmeaningshallbegiven toa term if it isestablished that thepartiessointended.

184Weininger,PervasiveProblemsinInternationalArbitration(2006),235andss.,andKaufmann-Kohler,PervasiveProblemsinInternationalArbitration(2006)257andss.SeealsoConforti(2013),(n.7),112andss.,andGardiner,TreatyInterpretation(2008),142.

64

Fromtheaboveprovisionthreemainelementsemerge:(i)interpretationshallbecarriedout ingoodfaithaccordingtotheordinarymeaningtobegiventotreatyprovisions;(ii)interpretationshallbeperformedaccordingtotheobjectandpurposeofthetreaty;and(iii) interpretationshallkeepintoaccountthecontextinwhichthetreatyhasbeensigned.185

Wewillnowtrytounderstandhowtherequirementsfortheinterpretationoftreaties set forth in the VCLT have to be applied in order to interpret jurisdictionalclauses contained inBITs.As apreliminary remark it isworthnoting that theVCLTdoesnotprivilegeanyof theabove threecriteria.Theyareallequal for the sakeofinterpretinganinternationaltreaty.186Furthermoreanyofsuchelementsshallbekeptintoconsiderationsjointlywiththeothers.187Concerningtheordinarymeaningtobegiven to treaty provisions, it should refer to the “regular, normal or customary”188meaning that is attributed to a termor to a sequence of terms.However, as it hasbeenstatedbythe ICJ, theordinarymeaning“isnotanabsoluteone.Wheresuchamethodof interpretation results in ameaning incompatiblewith the spirit, purposeandcontextoftheclauseorinstrumentinwhichthewordsarecontained,noreliancecanbevalidlyplacedonit”.189

This lets the context (i.e. the relevant constraints of the communicativesituationthatinfluencethelanguageuse,languagevariationanddiscoursesummary)comeintoplay.Infact“contextisasanimmediatequalifieroftheordinarymeaningof termsused in the treaty andhence context is an aid to selectionof theordinarymeaningandamodifierofanyover-literalapproachtointerpretation”.190

Finally,inregardtotheobjectandpurposeofthetreaty,itshouldbesaidthatevenifitisnoteasytounderstandifsuchtermshaveadifferentmeaning,astudyhasclarifiedthat“theterm‘object’indicatesthusthesubstantialcontentofthenorm,theprovisions, rightsandobligationscreatedby thenorm.Theobjectofa treaty is theinstrument for theachievementof thetreaty’spurpose,andthispurpose is, in turn,thegeneralresultwhichthepartieswanttoachievebythetreaty”.191

Given the above, it isworth understandingwhat are the context, the objectandthepurposeofaBIT.Inregardtothecontext,asstatedinparagraph1.2above,itisarguablethatBITs(particularlytheonesconcludedinthelate20thcentury)should

185Apartiallydifferent approach to interpretationofBITs is proposedbyCiurtin,RevistaRomânădeArbitraj(2015),65andss.186SeeGardiner,(2008)(n.184),142.187Ibid.,161.188Gardiner,(2008)(n.184),164.189 South West Africa (Liberia v. South Africa, jointly with Ethiopia v. West Africa), PreliminaryObjections,Judgement,20May1961, ICJReports1962,336. Inthis regardGardiner,at161-162,says“Grotiushadstated: ’If there isno implicationwhichsuggestsadifferentconclusion,wordsare tobeunderstoodintheirnaturalsense,notaccordingtothegrammaticalsensewhichcomesfromderivationbutaccordingtocurrentusage’.ThusGrotius’openingwordseffectivelysupporttheapproachtakeninthe Vienna rules in that they start with the ordinary meaning but allow for different implications”.Gardiner’squotereferstoGrotius,DeJureBelliacPacis,Oceana(1964),BookII,409.190Gardiner(2008)(n.184),177.191Buffard,Zemanek,AustrianReviewofInternational&EuropeanLaw(1998),326.

65

be contextualized in an economy that is trying to become even more global andwhereamovementof capital from thenorth to the southof theworld is essential.ThereforeStatesarewillingtoincentivizeinvestments(i.e.thepurposeofthetreaty)troughnormswhichcreateveryfavourableconditionsforinvestorsinthehostStates(i.e.theobjectofthetreaty).192

Hence,itisnotsurprisingthat,forexample,theTokiosTokelesTribunal,facingaBITprovision (i.e. art. 1(2)(b)of theUkraine-LithuaniaBIT) stating that investor is“any entity established in the territory of Lithuania in conformitywith its laws andregulations”,hasstatedthat“[t]heobjectandpurposeoftheTreatylikewiseconfirmthat thecontrol-testshouldnotbeusedto restrict thescopeof ‘investors’ inArticle1(2)(b).ThepreambleexpressestheContractingParties’intentto‘intensifyeconomiccooperationtothemutualbenefitofbothStates’and‘createandmaintainfavourableconditionsforinvestmentofinvestorsofoneStateintheterritoryoftheotherState’.TheTribunal inSGSv.Philippines interpretednearly identicalpreambulary languagein the Philippines-Switzerland BIT as indicative of the treaty’s broad scope ofinvestmentprotection.WeconcurinthatinterpretationandfindthattheobjectandpurposeoftheUkraine-LithuaniaBIT istoprovidebroadprotectionof investorsandtheirinvestments”.193

In light of the above it is not possible to criticize the Tribunals’ approach incaseswhereTribunalshaverefusedtoreadtheBIT jurisdictionalprovisions inawaythat isdifferent fromtheone resulting fromtheordinarymeaning, thecontext, theobjectandthepurposeofthetreaty, i.e.thepromotionof investments.Theraiseofparallelproceedingsseemsjustifiedbytherulesoninterpretationoftreatyprovisionsconferringjurisdiction.

Indeed,ifBITsprovidethatthemereownershipofsharesisaninvestment,itisnot surprising that we can have several autonomous claims from the variousshareholdersofasamecompany. Inthisregard, it isworthhighlightingwhatstatedbytheCMSTribunal:“TheTribunalnotesinrespectthattheCentre[ICSID]hasmadeeveryeffortpossibletoavoidamultiplicityoftribunalsandjurisdictions,butthatitisnot possible to foreclose rights that different investorsmight have under differentarrangements”.194

192SeeDiBenedetto,InternationalInvestmentLawandtheEnvironment(2013),150,accordingtowhom“[t]he fundamental objectives of investment treaties are the protection and promotion of foreigninvestments. These are embedded into their overall structure and are confirmed in their preambles(andoftenbytheirtitles)”.193TokiosTokelesv.Ukraine,ICSIDCaseNo.ARB/02/18,AwardonJurisdiction,29April2004,para.31.Similarly, inSGSv.Philippines, ICSIDCaseNo.ARB/03/11,Decisionon Jurisdiction,29 January2004,para.116,theTribunalstated“theobjectandpurposeoftheBITsupportsaneffectiveinterpretationofart.X(2).TheBITisatreatyforthepromotionandreciprocalprotectionofinvestments.Accordingtothepreambleitisintended‘tocreateandmaintainfavourableconditionsforinvestmentsbyinvestorsof one Contracting Party in the territory of the other”. It is legitimate to resolve uncertainties in itsinterpretationsoastofavourtheprotectionofcoveredinvestments”Manyotherdecisionshavetakensimilarapproaches.194CMSGasTransmissionCompanyv.Argentina,ICSIDCaseNo.ARB/01/8,DecisiononJurisdiction,17July2003,para.86.

66

It is also fully justifiable that, even in cases of claims brought by shellcompanies, tribunalshave consented todisputes togoahead,because the relevantBITsallowedtostructureinvestmentsinamanneraimedattakingadvantageofmorethanoneinvestmenttreaty.WiththisregarditisworthremindingthedecisionsoftheSaluka and Yukos Tribunals mentioned in paragraph 1.1.3 above, where – even ifshowingsomesympathyforthepossibilityofprecludingjurisdictiontoclaimsbroughtbyshellcompanies–TribunalsstatedthattherelevantBITwordingprecludedthemtodoso.

However, it is worth noting that Tribunals could have also given a differentreadingoftherelevantBITs’provisionsandgiveprevalenceto“policyconsiderationsratherthantocanonsofinterpretation”.195Forexample,inVacuumSaltv.GhanatheTribunal refused to hear a claimby aminority shareholder,196and, in his dissentingopinionintheTokiosTokelesdecision,Prof.Weilexplainedwhytheabovementionedinterpretation of the majority of the Tribunal should be considered wrong.197It is,anyway,arguablethattheseopinionsdonotrepresentthemajoritarianpositionandthatTribunalsstillprefertorigidlyapplyVCLTprovisionandassumejurisdictioneverytimetheinterpretationoftherelevantBITprovisionsodictates,withoutcaringoftheriskofmultipleandconflictingproceedings(andawards).198Tribunalshavetherefore

195Weiniger(2006)(n.184),235andss.andinparticular247.196InVacuumSaltv.Ghana,ICSIDCaseNo.ARB/92/1,Award,16February1994,theTribunalrefusedtohear a claim by a company incorporated in Ghana, a minority shareholder (Mr. Panagiotopulos) ofwhich, owning 20% of the company’s shares, was Greek. Provided that thewords “foreign control”containedinarticle25(2)(b)oftheICSIDConventionarenotdefined,andthattheconceptofcontrolisnotintendedbyICSIDTribunals(andbyseveralscholars)asnecessarilycorrespondingtothemajorityof the shares, the Tribunal could have concluded that it had jurisdiction (due, inter alia, to the veryimportant technicalcontributionthatMr.Panagiotopulosgave in themanagementof thecompany).On the contrary it reachedanopposite conclusionanddidnot assume jurisdictiononVacuumSalt’sclaimstatingthattherewasnotforeigncontroloverthecompany.Probably,ifaBITbetweenGreeceandGhanawouldhaveexistedandifMrPanagiotopuloshadbroughthisclaimunderthisBIT,inlightoftheapproachesmentionedinthetextonthedirectclaimsbyshareholders,theresultcouldhavebeendifferent.197In his dissenting opinion Prof. Weil explained that ICSID has been created for the settlement ofinvestmentdisputesanditwouldbeamisuseofthesystemtoallowaclaimbyashellcompanyownedby nationals of the host State. With the same aim, in the abovementioned Aguas del Tunari case,Alberro-SemerenaissuedadissentingdeclarationwherehestatedthatitshouldnotbeallowedtoaninvestortochangethenationalityofashellcompanyinordertotakeadvantageofaBIT.Thisformoftreatyshoppingis,intheopinionofthedissentingarbitrator,anabuseofthesystem.198This does notmean that Tribunals are pro-investors biased. In case of ICSID claims brought by acompany incorporated inthehostState,Tribunalshave indeedsometimespiercedthecorporateveilandrefusedtoassumejurisdictiononthebasisofthefactthatthefinalbeneficiaryoftheinvestmentwasanationalofthehostState.ThishappenedintheabovementionedcasesTSAv.ArgentinaandinNationalGasv.Egypt.Acloser look to theawards reveals that tribunalshaveaccepted topierce thecorporateveilonthebasisofthefactthattheclaimwasbroughtbythecompanyincorporatedinthehostState: inthiscasetheprovisionofArticle25(2)(b)ofthe ICSIDConventionapplies.AccordingtotheTSA(notunanimous)andNationalGasTribunals,suchprovisionexpresslyrequirestheexistenceofa foreign control and therefore authorizes the Tribunal to pierce the corporate veil and look at theeffectiveforeigncontrolandthereforeattheeffectivebeneficiaryoftheinvestment.Itisanywayworthnoting that this approach has not been always followed. In the alreadymentioned casesAmco andothersv.Indonesia,AutopistaConcesionadadeVenezuelaC.A.v.theBolivarianRepublicofVenezuelaandAguas del Tunari v. Republic of Bolivia the Tribunals refused to lift the veil beyond the first level of

67

preferredtorespecttheprincipleofpartyautonomyasexpressedinBITsratherthanensuringthereliabilityandlegitimacyofinvestmentlawandarbitration.

It is therefore clear that, unless thewording of BITs is amended199(and thisseemsnotverylikelytohappen)200,asolutiontotheproblemofparallelproceedingsat the stage of jurisdiction is not likely, due to the fact that the VCLT and thenecessary respect the principle of party autonomy do not allow arbitrators to goagainst what has been expressed by the parties when giving their consent toarbitration.201

Does this mean that we are at a deadlock and there is no solution to theproblemofparallelproceedings?Itistheopinionofthepresentauthorthattherearestilltoolstobeusedinordertoavoidparallelproceedings.Suchtoolsmaybe:(i)anexerciseofpartyautonomyaimedatavoidingparallelproceedings;(ii)anexerciseofdiscretion by arbitrators at the jurisdictional stage; and (iii) a requirement of theapplicable substantive law aimed at avoiding the result of conflicting outcomes,regardlessofpartyautonomy.

InthenextChapterthesolutionsunder(i)and(ii)andwillbeexamined.Itwillbedemonstratedthatsuchremedies(i.e.consolidation,joinder,intervention,waiverclauses,forumnonconveniens,anti-suitinjunctionsandcomity),basedonanexerciseof discretion either by the parties or by the arbitrators, may not be assumed as ageneralremedytotheissuesofparallelproceedingsandconflictingawards.Indeed,itisnotpossibletobasethesolutiontotheproblemofparallelproceedingsonlyonapossible and discretionary remedy.What investment arbitration needs, in order topass the critics and increase its legitimacy, is a general remedy that is applicableregardlessofanexerciseofdiscretionbytheparties(orbythearbitrators).Weshallthereforetrytogobeyondpartyautonomyandseewhether–atacertainstageofthearbitralprocedure–asolutionofthiskindisavailable.

Chapter3willbeaimedatexaminingtheremediesofferedattheadmissibilityphase of international investment disputes. The objective of the Chapterwill be tounderstandifsuchremedies(i.e.abuseofprocess,resjudicataandcollateralestoppel)can be considered as generally and autonomously applicable solutions aimed atprecludingtheprosecutionofparallelproceedings(beingsuchproceedingsconcurringorsubsequent).Aswewillsee,acentralroleintheapplicationoftheseremediesshallbeassumedbyarbitrators,whoare the finalmanagersof thedisputeandhave theinherent powers to ensure that their process is respectful of the canons of a goodadministration of justice. Indeed, it is arguable that only if arbitrators are aware of

controlovertheclaimantcompany.Theyarguedthat:(i)theConventiontalksabout“foreigncontrol”and not about “effective control” and therefore a research beyond the first level of control is notjustified; (ii) the scope of art. 25(2)(b) of the ICSID Convention, as explained byMr. Broches in theReportoftheExecutiveDirectors,istoexpand(andnotreduce)thejurisdictionoftheCentre.WiththisregardseealsotheabovementionedTokiosTokelesDecisiononJurisdiction,atpara.46.199AsithashappenedfortheCETA.Pleaserefertofootnote90above.200Boddiker,AmericanUniversityInternationalLawReview(2010),1070.201Zoppo(2013),239andss.hastalkedabouta“legalization”offorumshopping.

68

theirdutytoensuretheconsistencyof international investment law(andarbitrationawards)theissueofinconsistencyandincoherencewillberesolved.

69

Chapter2Theinappropriatenessoftraditionalremediesbasedonpartyautonomyoronthe

discretionofarbitratorsandtheInadequacyofthesolutionssetforthininstitutionalcommercialarbitrationrules

Chapter1hasbeenaimedatdemonstratingwhyparallelproceedingsshallbeavoidedandthereasonsbehindthenecessityofageneralremedytothisproblem. Chapter 2 will demonstrate that the legal instruments aimed at avoidingparallel proceedings that are applicable at the jurisdictional phase of investmentarbitration proceedings are not well fitted to offer such a remedy in internationalarbitration. As it will be seen below, the main reason for which such tools areunsuitablefortheaimofourresearchisthattheyarealwaysbasedonconsent,1i.e.onan expression of autonomy of the same parties that commenced the parallelproceedings. It will be demonstrated that there exist a strong contrast between theconsensualparadigmof internationalarbitration,which issometimesalsocalledthe“grundnorm”of internationalarbitration,2andthenecessitythatarbitration–havingdefactobecomethenaturaljudgefordisputesrelatedtointernationalcommerceandinparticulartointernationalinvestments3–adaptstothesubstantialneedsofmoderntransactions. 4 The formalism related to consent, indeed, often does not allowarbitrationtoadapttothesubstantiverealityofcomplexdisputes,thusgeneratingan“artificialdiscrepancybetweenthesubstantiveandtheproceduralaspectofthesamemultiparty relationship”.5This situation generates a paradox, perfectly described byProf.Stipanowichina1987paper:“[e]conomyandefficiencymaybefrustratedbyanumberofdilatoryfactorsbefore,duringandafterthearbitration.Ironically,manyofthesepotentialcausesofdelayarerooted inthosecharacteristicsofarbitrationthatdistinguish it fromtraditionaladjudicationprocesses.Nowhere is thisparadoxmoreevidentthatindisputesinvolvingmultipleparties”.6Inlightoftheabove,asperfectlyexpressed by Leboulanger, “strangely enough, in some aspects, domestic litigationseemsbetteradaptedtocertainsituationsthaninternationalcommercialarbitration,

1EveninthecaseswhereAuthorstrytoavoidananalysisofconsent,focusingondifferentelementsofthe proceedings, such as the meaning and extent of the concept of “dispute”. Reference goes inparticulartoBrekoulakis,ThirdPartiesinInternationalCommercialArbitration(2010),210andss.2Hosking,PepperdineDisputeResolutionLawJournal(2004),565.Craig,MultiplePartyinInternationalArbitration (2009), lvii, has talked about the “pierre anguilaire of arbitration”.See alsoPark,MultiplePartyinInternationalArbitration(2009),4.ForabroadanalysisoftheissueofconsentseeRau,MultiplePartyinInternationalArbitration(2009),69andss.3Youssef,MultipartyArbitration (2010),99,statingthat“Thedeclineoftherequirementofconsentasmay be rationalized by reference to the emergence of arbitration as the judge naturel of disputesarisingunderinternationalcontracts”.4Strong,VanderbiltJournalofTransnationalLaw(1998),917.Similarly,seeBamforth,Maidment(2009),3.5Brekoulakis,PennStateLawReview(2009),1182.6Stipanowich,IowaLawReview(1987),475.

70

namelythose involvingrelatedproceedings”.7It is thereforequestionablewhether itwould be worth to develop a more flexible approach to jurisdiction in arbitration,keeping into consideration concerns of equity and substantial justice.8At the sametime, however, it will be demonstrated that an analysis of consent is unavoidablewhen assessing arbitrators’ jurisdiction and that a solution to parallel proceedingscannotbefoundatthisstageofarbitralproceedings.9 TheanalysismadeinthepresentChapterwillstartwithforumselection,fork-in-the-road andwaiver clauses (Paragraph 2.1.1) and thenwill focus on the variousdoctrines developed in international commercial arbitration, i.e. joinder (Paragraph2.1.2.1),consolidation(Paragraph2.1.2.2)andquasiconsolidation(Paragraph2.1.2.3).Suchremedies,basedonpartyautonomy,arenotabletoprovideageneralsolutiontotheproblemofparallelproceedings,becausetheynecessarily involveachoicebytheparties,which–forseveralreasons–couldbenot interestedinavoidingparallelproceedings. With particular reference to joinder and consolidation, paradoxically,suchremediesarenotsetforthinICSIDConventionandRulesandthereforeinICSIDarbitration(i.e.themostcommonformofinvestmentarbitration)itisnotpossibletohaveanyformofcoordinationbetweentwoICSIDproceedings,oranyformofjoinderofthirdpartieswithoutanexpressmanifestationofconsentbyallthepartiesinvolvedin the claim(s).Hence, at present,without consentby all theparties,weare –withparticular regard to ICSIDarbitration–stuck ina situation inwhich therecannotbeany form of real coordination between parallel proceedings or any kind ofinvolvement of third parties other than the already analysed amicus curiae, whichcannotbeconsideredevensimilartojoinderorintervention.Abriefreferencewillalsobemadetocollectiveproceedingsstartedbyinvestors. Similar conclusions will be reached with regard to other remedies whichinvolveadiscretionarychoicebyarbitrators,suchasforumnonconveniensandcomity(Paragraph 2.2.1): the applicability of the kompetenz-kompetenz principle at thejurisdictional stage of proceedings necessarily involve choices to be taken byarbitrators, that not necessarily are sensitive to the policy considerations againstparallelproceedingsoutlinedinthefirstChapter. Finally it will be demonstrated (Paragraph 2.2.2) that arbitral anti-suitinjunctionsarenotausefultooltosolvetheproblemofparallelproceedings,becausethe issuanceofsuchorders–otherthanbeingbasedonanexerciseofdiscretionbyarbitrators–isnotadvisable(duetotheundueinterferencethatanti-suitinjunctionshaveontheprincipleofkompetenz-kompetenz)andhasaverylimitedefficacytolimitjurisdictionofotherarbitrators.

7Leboulanger,JournalofInternationalArbitration(1996),43.8Youssef,ICCACongressSeries(2012),107andss.9Park (2009) (n. 2), 5, stated that “for arbitrators, motions to join non-signatories create a tensionbetween two principles: maintaining arbitration’s consensual nature, and maximizing an award’spracticaleffectivenessbybinding relatedpersons”.The issueof thediminutionof the importanceoftheroleofconsentingeneralinternationallawisdeeplyexaminedbyRomano,InternationalLawandPolitics(2007),791andss.

71

2.1 Remedies based on party autonomy (and secondarily on arbitrators’

discretion)

2.1.1 Forumselectionoptions,fork-in-the-roadandwaiverclauses This paragraph is aimed at demonstrating that the remedies to the issue ofparallelproceedingsbasedonanagreement(expressorimplied)betweenthepartiespriortothecommencementofadisputemaybeeasilycircumventedand,therefore,arenotaneffectivetooltodealwiththeissueatstake.Wewillfirstofallanalysethecaseofmanyjurisdictionaloptionscontainedinthesamelegalinstruments,andthenmovetosomemorecomplexanddebatedprovisions,i.e.fork-in-the-roadandwaiverclauses.

ForumselectionclausesWithregardto forumselectionclauses,asalreadyshowed inparagraph1.1.4

above, several BITs, multilateral treaties and national laws (as well as contractsenteredintobyStatesandforeigninvestors)containvariousjurisdictionaloptionsintheir dispute settlement clauses, giving a choice to the investor, that can thereforedecidebeforewhich (courtor) tribunal tobringadispute. In this regard, ithasbeenalreadystatedthat–inprinciple–nothingcouldpreventaninvestorinbadfaithfrompursuingall the remedies contained ina legal instrument.Moreover,nothingmightimpedethat,onthebasisof thekompetenz-kompetenzprinciple,all tribunalsbeforewhichthesamedisputehasbeenbroughtassumejurisdictiononthematter.Inlightofthecurrentwordingofdisputesettlementprovisionsincontracts,treatiesandlaws,thereisnoremedytothisphenomenon.Prof.PierreMayerhasthereforeproposedtoinsertininvestmenttreatiesaclarifyingprovisiontothiseffect(i.e.aprovisionsayingthatonceadisputesettlementmechanismunderaforumselectionclauseischosen,theothersshallbeexpresslywaived).10

Wehland, on the contrary, stated that “forum selection options must, inprinciple,be[consideredimpliedly] limitedtoclaimsthathavenotyetbeenassertedelsewhere”andseemstoconsideruselessMayer’sproposedprovision.11Hemotivatessuch an assertion on the basis of the fact that “it seems inconceivable that thesignatoriestoanIIA(oradomesticlegislatorforthematter)couldhaveintendedsuchadeeply flowedoutcome”andonthebasisof“agoodfaith interpretationaimedatavoidingsituationsinwhichtheexerciseofaforumselectionoptionwouldhavetobeconsideredasanabuseofprocess”.12TheseWehland’sstatementseemsflawed.Firstof all, the intentions ofwhowrote a legal text are not necessarily prevailing in the10Mayer,Lecontentieuxarbitraltransnational(2006),200.11Wehland,The coordination ofmultiple proceedings in Investment TreatyArbitration (2013), 101. ThisAuthor, at 103, further states that “these limitationmust be seen as inherent to themechanism offorumselectionoptions.12Wehland(2013)(n.11),103.

72

interpretation of such legal text.13Secondly, in absence of a provision that clearlylimitsthepowerofaninvestortostartseveralclaimsindifferentforainrelationtothesame dispute, we could assume that what is not forbidden is to be consideredallowed.Finally,andmore importantly, it is todayextremelyeasy foran investor touse(ortomodifyadhoc)itscorporatestructureinordertostartaclaimwithanothercompanyofthegroupunderadifferentBIT,thusavoidingthealleged(implied)limitthat,inWehland’sopinion,iscontainedintheforumselectionclause.Similarly,forumselectionclausesarecompletelyuselessincaseofseveralclaimsinitiatedbymajorityandminorityshareholders,due to the fact that thevariousclaimsarestartedunderdifferentinvestmenttreaties.

Indeed, the sameuseof theword “inconceivable”byWehlanddemonstratesthathedidnotfoundalegalbasisforhisopinionandthatforumselectionoptionsarenot, contrary towhatWehland said, a useful device in order to coordinatemultipleproceedingsininvestmentarbitration.

Fork-in-the-roadclausesFork-in-the-roadclauses“offertheinvestorachoicebetweenthehostState’s

domesticcourtsand internationalarbitration.Thechoice,oncemade, is final. If theinvestorresortstothehostState’sdomesticcourtstohavethedisputesettled,itlosestherighttointernationalarbitration”.14Suchclausesaretodaynotonlylimitedtogivean alternative among investment arbitration and national courts litigation, but areaimedatexcludinganypreviouslyagreedformof litigationwhenthepartieschoosetorefertoinvestmentarbitration.15Inthisregarditisoftensaidthatelectaunavianondatur recursus ad alteram. An example of fork-in-the-road clause is Article 8(2) ofArgentina-France BIT, providing that “[u]ne fois qu’un investisseur a soumis ledifférend soit aux juridictions de la Partie contractante concernée, soit à l’arbitrageinternational,lechoixdel’uneoudel’autredecesprocéduresrestedéfinitif”.

The usefulness of fork-in-the-road provisions is, however, very limited. Theirmain limit is that “they only apply where the dispute in the previous and the laterproceedings is the same”.16For the sake of the applicability of fork-in-the roadclauses, two disputes are “same” if the so-called triple identity test is met. 17Accordingly, theparties, thepetitum (i.e. the request to theTribunal)andthecausapetendi (i.e. the legal basis for the request to the tribunal) must be identical. Inparticular, on the basis of the wording of the relevant treaty provisions, the

13Inthisregard,pleaserefertotherulesontreatyinterpretationexaminedinthefirstChapter.14Schreuer,TheICSIDConvention:ACommentary(2009),365.15SeeWehland(2013)(n.11),86.SeealsoArticleVIoftheEstonia-USBIT.16SeeWehland(2013)(n.11),88.17SeeSchreuer,The JournalofWorld InvestmentandTrade (2004),245and ss.SeealsoAlexGenin,EasternCreditLimited,Inc.andA.S.Baltoilv.TheRepublicofEstonia,ICSIDCaseNo.ARB/99/2,Award,25 June 2001. This opinion has been strongly criticized by Lowenfeld,www.transnationaldisputemanagement.com(2006),inparticularwithregardtothenecessityofstrictidentitybetweentheparties.AccordingtoWehland(2013)(n.11),91,footnote296,anopinionsimilartoLowenfeld’shasbeensustainedbytheadhoccommitteeintheVivendicase.

73

requirementsofthesamepartiesandthesamecausapetendihavebeenappliedverystrictly.Hence,eveninpresenceofpartieswhichsubstantiallyrepresentedthesameinterestsbutthatwereformallydifferent,Tribunalsdidnotfindthatthetripleidentitytestwasmetanddidnotapply fork-in-the-roadprovisions.Similarly, tribunalshavesaidthatthat“thedisputeintwosetsofproceedingsisidenticalonlywheretheclaimsasserted in both of them have the same legal basis”.18This position is perfectlyshowed by the approach of the Tribunal in Lauder v. Czech Republic,19where theRespondentStatetriedtoarguethatthefork-in-the-roadprovisioncontainedintheUS-Czech Republic BIT 20 precluded a claim which, as already explained, wassubstantially identical to the claim in another dispute arisen from the same State’smeasures (CME v. Czech Republic).21The tribunal, at para. 162 stated that “theresolutionof the investmentdispute under theTreatybetweenMr. Lauder and theCzech Republic was not brought before any other arbitral tribunal or Czech courtbefore–orafter–thepresentproceedingswereinitiated.Allotherarbitrationorcourtproceedings referred to by the Respondent involve different parties, and deal withdifferentdisputes”.ThedramaticoutcomesoftheTribunal’sdecision,whichreachedopposite conclusions to the CME Tribunal, are well-known and have been alreadydescribedinChapter1.

Moreover, fork-in-the-road provisions do not preclude separate claims bymajority and minority shareholders, thus allowing several arbitration proceedingsunderdifferentBITsandinrelationtothesameStatemeasure.

As an example of fork-in-the-road provisions in investment arbitration it isoftencitedArticle26oftheICSIDConvention,statingthat“ConsentofthepartiestoarbitrationunderthisConventionshall,unlessotherwisestated,bedeemedconsentto such arbitration to the exclusion of any other remedy. A Contracting StatemayrequiretheexhaustionoflocaladministrativeorjudicialremediesasaconditionofitsconsenttoarbitrationunderthisConvention”.Withconcerntothisclauseitshouldbenoted, anyway, that the words “unless otherwise stated” seem to envisage thepossibilitythatthepartiesmaygivetheirconsenttomorethanonedisputeresolutionmechanism.FurthermorethemechanismprovidedforinthisArticleoperatesatthemomentofconsent22andnotatthemomentofthecommencementofthedispute.For this reason it isarguable thatArticle26of the ICSIDConvention isnotaproperfork-in-the-roadmechanismbut adeviceaimedat avoiding that –unlessotherwisestated –consent is given to several forms of dispute resolution. Thismeans that, inprinciple,itcanhappenthatseveralproceedingsareinitiatedindifferentfora.Thisisexactlywhathappened in theSPPv. Egypt23case,where theTribunalhad toadmit

18Wehland(2013)(n.11),93.19Ronald S. Lauder v. TheCzechRepublic,UNCITRAL, FinalAward, 3 September 2001. Several otherauthoritieswhichreachedthesameconclusionsarementionedinSchreuer(2004)(n.17),246andss.20SeearticleVI(3)ofUS-CzechRepublicBITandSchreuer(2004)(n.17),245.21CMECzechRepublicB.V.v.TheCzechRepublic,UNCITRAL,Award,14March2003.22Schreueretal.(2009)(n.14),352.23SouthernPacificProperties (MiddleEast)Limitedv.ArabRepublicofEgypt,ICSIDCaseNo.ARB/84/3,

74

that“whenthejurisdictionsoftwounrelatedandindependenttribunalsextendtothesamedispute,thereisnoruleofinternationallawwhichpreventseithertribunalfromexercising its jurisdiction”.24This statement goes against who said that “Article 26seems to achieve consolidation at least temporarily as it provides that only oneproceduremaybependinginrelationtoacertaindispute”.25

Another limitofArticle26of the ICSIDConvention is that itoperatesonly incasetherequirementsofthetripleidentitytestaremet.Thismeansthatallthelimitsthatwehavealreadyexaminedforfork-in-the-roadclausesinBITs(i.e.thepossibilityofseveralclaimsunderdifferentBITsbyvariousshareholdersorbyvariouscompaniesofthesamegroup)arepresentalsoundertheICSIDConvention.

For all the above reasons, even if “it makes more sense to have the entiredispute heard by one tribunal, preferably the one with the most comprehensivejurisdiction”,26itisstronglyarguablethatfork-in-the-roadprovisionsarenothelpfulinreachingthisobjective,duetotheseveraldrawbacksthat thecurrentapplicationofsuch clauses involves. While, as it will be argued in Chapter 3 below, the strictapplication of the triple identity test is not sustainable in presence of non-writtengeneral principles of law (such as res judicata, collateral estoppel and abuse ofprocess), it is very difficult to demonstrate that, in presence of a very strict treatyprovision, as in the case of fork-in-the-road clauses, it is possible to waive therequirements of the triple identity test. “Evenwhere a treaty contains a fork in theroadprovision,the lattersimplywillnotcoverall thesituations inwhichan investormighttrytorelitigateadispute”.27

WaiverclausesThelastmechanismofpreventionofparallelproceedingspossiblycontainedin

arbitrationclausesaretheso-calledwaiverclauses.Suchclausessetforththatonceadisputeunderacertaintreaty,contractorlawiscommenced,theclaimantwaivesallotherpossibleproceedingsthathemaycommence.

As a preliminary remark, it should be noted that, in practice, the effects ofwaiverclausesaredifferentdependingonthekindoflegalinstrumentsinwhichthey

DecisiononJurisdiction.24SPPv.Egypt,DecisiononJurisdiction,14April1988,para.53-56.AsimilarstatementcanbefoundinChampionTradingCompanyandOthersv.Egypt,ICSIDCasen.ARB/02/09,DecisiononJurisdiction,21October2003,para.19,where it is stated that “theConventiondoesnotcontainany rules regardingpossibleparallelproceedings”.Anyway,intheSPPdecision,theTribunalfurtherstatedthat“however,intheinterestofinternationaljudicialorder,eitherofthetribunalsmay,initsdiscretionandasamatterofcomity,decidetostaytheexerciseof its jurisdictionpendingadecisionbytheother tribunal” (wewillcomebackonthetopicofcomity later inthisChapter). Inthiscasea ICCanda ICSIDarbitrationproceedingswereconcurrentlypending.25ThispossibilityisenvisagedbyCrivellaro,TheLawandPracticeofInternationalCourtsandTribunals(2005),385,who–anyway–deniesitsapplicabilityat388.ThisopinionisprovedwrongalsobywhathasbeenstatedinSGSSociétéGénéraledeSurveillanceS.A.v.RepublicofthePhilippines,ICSIDCasen.ARB/02/6,DecisionoftheTribunalonObjectionstoJurisdiction,29January2004,para.144-148.26Crivellaro(2005)(n.25),389.27Wehland(2013)(n.11),98.

75

are contained. If waiver clauses are contained in an investment contract or in anational law, usually they consist in an advanced waiver of all the mechanisms ofdispute settlementnot contained in the contractor lawwhich sets forth thewaiverclause (i.e. such clauses usually consist in an advanced waiver to investmentarbitration). On the contrary, when waiver clauses are contained in a treaty, they“prevent an investor from submitting the dispute to any other forum once he hasoptedforarbitrationunderthetreaty”.28

With regard towaiver clauses contained in contracts and/or national laws, itshouldbenotedthatthereisstillmuchdebateregardingtheirvalidity,duetothefactthatseveralauthoritiesdonotconsiderpossibleforaninvestortowaiveinacontracttherighttocommenceinvestmentprovidedinaBIT.29Furthermore,consideringthatsuch clauses are usually aimed at focalizing the investment dispute before nationalcourts, they do not usually involve parallel proceedings between investmentarbitrationtribunalsandarethereforeoutofthescopeofthepresentbook.30Forthesake of completeness, anyway, it is worth noting that such clauses – if they areconsidered valid – set forth a hierarchy between contract claims (or claims arisingfrom the provisions of a national law) and treaty claims and operate only if therequirements of the triple identity test aremet. Thismeans that also these clauseshave a very limited applicability in order to prevent parallel proceedings. It will besufficient foran investor tomodify itscorporatestructure inorder to formallyclaimdamages through another entity of its corporate chain, taking benefit of theprovisions of another BIT and therefore bypassing the limits of the waiver clause.Furthermore, these clauses cannot in anyway precludemultiple claims bymajorityandminorityshareholders.

Concerning the waiver clauses contained in investment treaties,31which aremore interesting for the sake of the present work, it is worth mentioning theprovisions of Article 1121 of theNAFTA,Article II.20(2) of the TPP,Article 26(2) of2012USModelBITandArticle26(1)(e)of2004CanadaModelBIT,allprovidingthataclaim under the dispute settlement mechanisms provided in such treaties may becommenced only if the investor expressly “waives any right to initiate or continuebefore any administrative tribunal or court under the law of any Party, or other

28Id.,98-99.29SeeSGS v. Philippines, Decision on Jurisdiction, para. 154,where it is stated that “it is, to say theleast,doubtful thataprivatepartycanbycontractwaive rightsordispensewith theperformanceofobligations imposed on the States parties to those treaties under international law. (…) Thus thequestion isnotwhether theTribunalhas jurisdiction:unlessotherwiseprovided, treaty jurisdiction isnotabrogatedbycontract”.AnoppositeapproachhasbeentakenbytheTribunalinAguasdelTunariSA v. Republic of Bolivia, ICSID Case No. ARB/02/3, Decision on the Respondent’s Objection toJurisdiction,21October2005.InthisregardseeBlyschak,works.bepress.com(2008),49andss.30We shall therefore refer to the work of other Authors. See Romanetti, Stockholm InternationalArbitration Review (2009), 75 and ss., Spiermann, Arbitration International (2004), 179 and ss.,Hoffmann,ICSIDReviewFILJ(2007)69andss.SeealsoStrong,ICSIDReviewFILJ(2014),1andss.,whoanalysestheproposedprovisionofawaiverclauseinaColombiannationallawwhichgeneratedseveraldisappointmentsintheinternationalcommunityandwasthereforedeleted.31SeeMcLachlan,Shore,Weininger,InternationalInvestmentArbitration(2007),107andss.

76

dispute settlementprocedures, anyproceedingswith respect to themeasure of thedisputingParty”.32Wehlandarguesthat,inlightofthereferencetothesameState’s“measure”(andnottothesamedispute,asinthecaseoffork-in-the-roadprovisions),waiverclauseshave“theadvantageofobviatingtheneedtodeterminewhetherthedispute in a subsequent action is the same as the one brought before the treatyforum”.33Furthermore,hearguesthatwaiverclauseshavetheadvantagetorefertoanyfuturerequestforreliefandto“gobeyondthe‘sameparties’criterioninthattheytypicallyalsorequirethewaiverofclaimsbyenterprisesownedorcontrolledbytheinvestorrelyingonthetreatymechanism”.34

With regard to the alleged lack of the requirement of the same dispute, itshould be noted that there is no agreement on the fact that it shall not bemet inpresenceofwaiverclauses.Indeed,CremadesandMadalenastatethat“applicationofthewaiver usually requires identity between thedifferent claims”.35In this regard itshouldbenotedthat, in lackofpreviouscaselawonthematter, it isnotpossibletosaythatthemerereferencetothesameState’smeasures(whichis,anyway,agoodpointinfavourofabroadreadingofwaiverclauses)willbeconsideredasasufficientargument by future Tribunals. If Wehland’s opinion should be considered correct,waiver clauses contained in a treaty could be considered a useful tool to preventmultiplecontractandtreatyclaimsbythesameinvestor.

The lack of the same parties requirement is argued on the basis of theprovisionsofArticle1121Naftaand26(2)(b)(ii)ofthe2012USModelBITwhichreferto “the investor, and where the claim is for loss or damage to an interest in anenterpriseofanotherPartythatisajuridicalpersonthattheinvestorownsorcontrolsdirectlyorindirectly”.Inthisregarditshouldbeconsideredthatasimilarprovisionisnotcontained inothertreaties (and inparticular inthenewTPP,whichhasdefactoreplacedtheNAFTA)andthisunderminetheapplicabilityoftheruleonalargescale.Moreoveritisarguablethatitcouldbeeasyforaninvestorinbadfaithtobypasstheobstacle generated by the waiver clause: again, by simply amending its corporatestructurehewillgain thebenefitsofoneormoreothersBITs inorder tostartmoreclaimsinrelationtothesamedisputeormeasure(asimplereferenceAguasdelTunaricase mentioned in Chapter 1 is sufficient to describe this scenario). Furthermore,investor’s shareholders (majority orminority) are completely entitled to commenceseparatearbitrationproceedingsinrelationtothesamemeasure.Asaconsequence,unlessawaiverclausesuchastheonesetforth inArticle1121NAFTAisprovidedinalmostallBITs,suchclausescannotbeconsideredasageneralremedytotheproblemof parallel proceedings (in particular in cases of claims by companies of the same

32For an application of such clauses see Waste Management Inc. v. United Mexican States (WasteManagementI),ICSIDCaseNo.ARB(AF)/98/2,Award,2June2000.33Wehland(2013)(n.11),99.34Ibid.35Cremades,Madalena,ArbitrationInternational(2004),531.

77

groupandincasesofmultipleclaimsbymajorityandminorityshareholders)andarenothelpfulforthesakeofthepresentbook.36

2.1.2 Introduction to multiparty and multicontract situations in international

commercialarbitrationandpossibleapplicationsininvestmentarbitrationInternational commercial arbitration scholars usually distinguish between

multiparty and multicontract arbitration.37We refer to multiparty arbitration whenthere are more than two parties involved in the proceedings, opposite to thetraditional bi-party arbitration where there are only two parties. The phrasemulticontractarbitration,on theotherhand, is referred to thosesituations inwhichthe sourcesof obligations aremore thanone, irrespectiveof thenumberof parties(and substantial interests) involved in the proceedings; hence, multicontractarbitrationsmaybebothbi-partyandmultiparty.

Furthermore, in case of multiparty arbitrations we can distinguish betweencases inwhichtherearemorethantwosubstantive interestsrepresentedwithintheproceedings,thatwewillcallmulti-polararbitrations,oppositetothecasesinwhich–eveninpresenceofmorethantwoparties–thereareonlytwosubstantiveinterestsinvolvedintheproceedings,whichcanbeclassifiedasbi-polararbitrations.38

Inlightoftheabovewecandistinguishthefollowingthreesituations:a) amultiparty arbitration inwhichonly two substantive interests are

represented(bi-polar,multipartyarbitration);b) amultipartyarbitrationinwhichmorethantwosubstantiveinterests

arerepresented(multi-polar,multipartyarbitration);c) a bi-party arbitration in which there are more than one source of

obligations between the same parties (bi-polar, multicontractarbitration).

ThethreesituationsdescribedabovemayberelatedtothesourcesofparallelproceedingspinpointedinChapter1:

1) thecaseofachainofcompaniesofthesamegroup(paragraph1.1.3)startingseveralproceedingsagainstthesameState(underdifferentBITs)maybeequalizedtoabi-polar,multipartyarbitration. Indeed,thevariouscompaniesofthesamegrouprepresentthesameinterestagainstthehostState;

36EvenWehland(2013)(n.11),99atfootnote356admitwhathasbeenstatedinthetext,sayingthat“itshouldbenoted that this inclusionof certain relatedparties representsonlyapartial solution to theproblemsassociatedwithmultiplepotential claimants. (..) Inparticular,awaiverprovisionwouldnotappear to prevent an investor’s controlling shareholder from subsequently initiating another set ofproceedings”.37 See Mantilla Serrano, Multiparty Arbitration (2010), 11 and ss., Hanotiau, Multiple Party inInternational Arbitration (2009), 35 and ss., Polinari, Rivista dell’arbitrato (2006), 537 and ss. For acompleteanalysisofthese issuesseeHanotiau,ComplexArbitrations:Multiparty,Multicontract,Multi-IssueandClassActions(2006),1andss.38ForanembryonicanalysisofsuchsituationsseeLaitinen(2013),10andss.

78

2) the case ofmajority andminority shareholders (paragraph 1.1.2) ofthesameinvestorstartingseveralclaimsagainstthehoststatemaybeequalizedtoamulti-polar,multipartyarbitration.Infact,evenifinprinciplemajority andminority shareholders claim damages arisingfrom the same State measure, they still could represent differentsubstantialinterests;

3) the case of contract and treaty claims between the same parties(paragraph 1.1.1) may be equalized to a bi-polar, multicontractarbitration, in which there are two parties starting more claims(arisingfromthesameStatemeasure)underdifferentlegalsources.

Given theaboveclassification,wewillnowtry toanalyse themechanismsofjoinder, consolidation and quasi consolidation, mainly developed in the field ofinternational commercial arbitration, and their suitability, in investment arbitration,tolimittheeffectsofparallelproceedingsinthevariousscenariosdescribedabove.

Themainissuesthatwewillfaceinthediscussionarerelated,inparticular:(i)totheconsensualnatureoftheseremedies;(ii)totheregulation(ifany)oftheabovemechanisms inarbitrationrulesand laws;and(iii) tothefactthat– inmanycases–thesemechanismsarescarcelycompatiblewiththestrictrequirementsofnationalityinvolvedininvestmentarbitration(i.e.anarbitrationagainstaStateunderaBITcanbe start only by a national of the other contracting State of the same BIT), whichpreclude in principle the recourse to arbitration by persons which do not have therequirednationality.

The discussion will always be conducted keeping into consideration the(already analysed) several policy considerations against parallel proceedings ininvestment arbitration39 which run against the formalities related to consent inmultiparty/multicontractmechanismsininternationalcommercialarbitrationandcallforamore flexible (and justiceoriented)approach,basedon thenecessity toadaptproceduralaspectstosubstantialreality.40

2.1.2.1 Joinder (and intervention): Looking for an implied consent? The

methodologiesappliedininternationalcommercialarbitrationandtheirfallacyifappliedininvestmentarbitration

AccordingtoNatalieVoser“arequestfor joinderexistswhentherespondent

wants to file a counterclaim either against the claimant and a third party, or solely

39Namely good administration of justice, procedural efficiency (save time and costs) and, mainly,avoidingduplicationofproceedingsandcontradictoryawards.SeealsoLeboulanger(1996)(n.7),53-54.40SeePlatte,ArbitrationInternational(2002),69,statingthatan‘economicreality’analysisshouldbeapplied. On the contrary, Hanotiau, International Arbitration 2006: Back to Basics (2007), 357, hasstated that “the issue of ‘extension’ of the arbitration clause to non-signatories would be easier todecideifitwereapproachedbycourtsandcommentatorsinamorerigorousway”.

79

against the third party”.41The third party, which can be or not a signatory to thearbitration agreement, 42 is therefore dragged into an arbitration which initiallyinvolvedtwootherparties.

Incaseofintervention,onthecontrary,itisthethirdparty–whethersignatoryornot43–thataskstobeinvolvedintheproceedingsinordertobringitsownclaimortosupporttheclaimofoneoftheparties.44Inthisregarditshallbepointedoutthat,incasesofparallelproceedingsininternationalarbitrationarisingfromthesituationsoutlinedinChapter1above,itisveryunlikelythatoneoftheseveralclaimantswillasktothetribunaltointerveneintheproceedingsduetothefactthatsuchclaimantsareusuallywillingtokeeptheadvantagesofseveralseparateproceedingswhichincreasetheirpossibilitytobesuccessfulinthedispute.

AsthesameVoserpointsout,“sometimesthewordingusedinthecontextofjoinderisnot‘thirdparty’butthirdperson.Ontheonehand,inatechnicalsense,thiswording ismorecorrect,sincethethirdpersontobe joined isnotyetapartytothearbitralproceedings.Ontheotherhand,ifathirdpersonhasimplicitlyconsentedtothe arbitration agreement, it should automatically be a party to the arbitrationproceedings”.45Accordingly, we will therefore refer to third persons to be joined inarbitrationproceedingsinordertobecomeapartyofthesameproceedings.46

Whenevaluating if a joinder is appropriate in a certain case,we shall alwayskeepintoconsiderationthedueprocess(and,moregenerally,policy)concernsrelatedtosuchmechanism.Inparticular,firstofall,whenoperatingajoinder,arbitratorsshallensure that every party is granted the full opportunity to present its case.47Thisanalysis can only be carried out on a case by case basis. Furthermore, it is usuallyemphasizedthat–ininternationalcommercialarbitration–incaseofjoinderaftertheproceedings have been commenced, the joined party loses its right to appoint itsarbitrator.48Moreover, it couldbeargued that theconfidentialityofproceedings (at

41Voser,50YearsoftheNewYorkConvention(2009),346.42It is obviously easier, for the reasons that will be set out below, to operate a joinder in case thepersonsareallsignatoriesofthearbitrationagreement.Withthisregardseeart.816quaterof ItalianCodeofCivilProcedure.SeeGradi,CommentarioalCodicediproceduracivile(2014),366andss.43Alsointhiscasethereshouldnotbeproblemsforinterventionofsignatoryparties.ForacommenttoacontraryarbitraldecisionseeGradi,GiustiziaCivile(2012),2863andss.,inwhichitisdescribedacasewherearbitratorsrequiredasecondconsentbythepartiesofanalreadyinitiatedarbitrationinordertoallowtheinterventionofathirdpartysignatory.44ThepossibilityofinterventionincommercialarbitrationhasbeenstronglycriticizedbyBove,Rivistadell’arbitrato(1995),791.45Ibid.46Park(2009)(n.2)hastalkedabout“lessthanobviousparties”.Problemsrelatedtothirdpartiescanarisealsoincaseofassignment(outofthescopeofthepresentbook);forthesecasesrefertoJagush,Sinclair,PervasiveProblemsinInternationalArbitration(2006),291andss.47SeeStrong(1998)(n.4),982-984.48SeeTenCate,TheAmericanReviewofInternationalArbitration(2004),143andss.,statingthatthissituationshouldnotbedramatized.SeealsoPlatte,(2002),(n.40),80,Leboulanger,(1996)(n.7),66,McIlwrath, Moolan, Joinder – Current Practice in International Arbitration,www.transnationaldisputemanagement.com (2005), 5, Nicklisch, Journal of International Arbitration(1994),61andss.,Schwartz,JournalofInternationalArbitration(1993),5andss.,Voser(2009)(n.41),350,Devolvé, Arbitration International (1993) 197 and ss. In this regard, Authors usually refer to the

80

least partially) will be lost.49In this regard it should be first of all noted that, ininvestmentarbitration,confidentialityconcernshavealimitedroletoplayduetothepublicnatureofthiskindofdisputes.50Concerningtherightofeveryinvolvedpartytonominate its arbitrators, it has been argued that “the significance of partyappointmentmaybepsychological”,51andthat,inanycase,arbitratorshaveadutyofimpartiality which should not prejudice the joined party. However, as investmentarbitration is today conceived, itmight be difficult to deprive a party of its right toappointitsarbitrator(oratleastparticipateintheappointmentofthesolearbitrator).

Keeping into consideration the scenarios 1), 2) and 3) outlined in paragraph2.1.2above, it isworthnotingthat joindercouldbeuseful inscenario1),dueto thefact that only in case of a bi-polar andmultiparty situation (i.e. in which there aremorethantwopartiesbuttherepresentedinterestsareonlytwo),suchastheoneofseveralclaimsstartedbyvariousentitiesofthesamegroup,itwillbepossibletojointhemultipleclaimants inthesameproceedings. Inthiscase, indeed,duetothefactthat the several joined claimants represent the same centre of interest, it is notarguable that such “centre of interest” did not have the possibility to appoint itsarbitrator. All the companies of the same groupwill have the right to appoint onearbitratorandtheirrightofappointmentwillnotbeviolatedduetothefactthatthesecompanies are substantially representing only one party. Indeed, as stated byLeboulanger,“thereisnomajorincompatibilitybetweentheruleofjoinderandmulti-contract situations between two parties”;52the same conclusion could be drawn inseveralclaimsarisingnotonlybycontractsbutalsobyinternationaltreaties.

Onthecontrary,ifonearguesthateachofthepartiesshouldalwayshavetheright to appoint its arbitrator, the possibility of joinder does not seem possible inscenario2).

In scenario 3), in considerationof the fact that theparties are only two, it isuselesstospeakaboutjoinder,becauseinordertoavoidparallelproceedingsitwillbenecessarytoconsolidatethetwoseparateclaims.

Giventheabove,it isfirstofallworthanalysingthevariousinstitutionalrulesandnational lawsregarding joinder in internationalcommercialarbitrationandtheirsuitability to regulate the matter also in investment arbitration. As a preliminaryremark, it isworth noting that the ICSIDConvention does not provide any formofjoinder/intervention of third parties and ICSID Rules are limited to accepting amicicuriae’ssubmissions(whichcannotbecomparedeithertojoinderortointerventionofthirdparties).decisionoftheFrenchCourdeCassation1eCiv.InBKMIv.Dutco,7January1992,1992Bull.Civ.,No.2.,wheretheCourdeCassationstatedthattherightofeverypartytoappointitsarbitratorisamatterofpublicpolicyandcanonlybewaivedbyanypartyafterthedisputehasarisen.Inthisregarditshouldbenoted that the various parties in theDutco case represented more centres of interests and so thedisputecouldbeclassifiedasmulti-polar,multiparty.49Voser(2009)(n.41),350-351,NIcklisch(1994)(n.48),68,Platte(2002)(n.40),75.50Foradifferentconclusion,seetheCordSyrupcasesmentionedinParagraph2.1.2.2below.51Chiu,JournalofInternationalArbitration(1990),58.52Leboulanger(1996)(n.7),68.

81

Moving to a reading of commercial arbitration rules it emerges immediatelythateithersuchrulesarestillstronglyanchoredtotherequirementofconsentor,asdemonstratedbythecaselaw,tribunalshaveanywayavoidedtojointhirdpersonsincaseswhereoneofthepartiesdidnotagreewiththejoinder.53Inthisregarditshouldbe highlighted that only recently themajority of institutional rules have started toprovideaspecificruleonjoinder.Someoftheserulesprovideforjoinderonlyifalsothepartytobe joinedhassignedthearbitrationagreement,givingthediscretiontoarbitratorstojoinsuchsignatoryparty.54Inothercasesitisonlyrequestedaconsenttojoinderbytherequestingpartyandthethirdperson,butnotbythenonrequestingparty.55In these last cases, even if the rules are silent on the necessity of originalconsenttothearbitrationagreementofall theparties, it is reasonabletothinkthatthetribunalwillneveroperateajoinderwithouttheconsentofalltheinvolvedparties,duetothefactthatitwillotherwiseincurintheriskofrefusalofenforcementoftheaward.56Finally,there isthebroadestprovision:Article4(2)ofthe2004SwissRules.Such rule states that: “Where one or more third persons request to participate inarbitral proceedings already pending under theseRules orwhere a party to arbitralproceedings under these Rules intends to cause one or more third persons toparticipate in thearbitration, thearbitral tribunalshalldecideonsuchrequest,afterconsultingwithall parties, including thepersonorpersons tobe joined, taking intoaccountall relevant circumstances” (emphasis added). In this case, the reference tothirdpersons(insteadofthirdparties)hasbeeninterpretedbysomeAuthorsasgivingfreedom to the tribunal to join thirdpersons that havenever signed the arbitrationagreement.57Alsointhislastcase,however,thereistheriskthatanarbitrationawardarising from proceedings in which one or more persons have been joined withoutconsentofallpartiesinvolvedisnotenforcedandthereforearbitratorscouldanywaykeepintoaccountthepositionofallthepartiesinvolvedintheproceedings.

In light of the above it canbe said that it is a fact that consent is today stillessentialtojointhirdpartiesininternationalcommercialarbitration.SeveralAuthors,whounderstandablyassertthatconsentisstillthecornerstoneandthegrundnormof

53Forageneralanalysisofsuchrules,seeGomezCarriòn,ArbitrationInternational(2015)479andss.,Pitkowitz,AustrianYearbookonInternationalArbitration(2015),301andss.54SeeArticle17.5ofUNCITRALRulesandArticle7(1)of2012ICCRules,Art.14of2013ViennaRules,Art.27of2013HKIACRules.S.35oftheEnglishArbitrationAct1996(regardingconsolidation)seemstohaveadoptedasimilarapproach.55SeeArticle22.1(viii)ofthe2014LCIARules,whichanywaystill requestarbitratorstogivetoallthepartiesthereasonableopportunitytostatetheirview,Art.24(b)SIACRules,Art.19.2of theSpanishRules.TheprovisionofArticle22.1(viii)oftheLCIARuleshasgeneratedalotofdebate.See,interalia,Voser(2009)(n.41),398,Brekoulakis(2010)(n.1),104andss.,GomezCarriòn(2015)(n.53),486-488.OnLCIARulesseeWinstanley,MultiplePartyActioninInternationalArbitration(2009),213andss.56SeeMayer,MultipartyArbitration(2010),223andss.57See Brekoulakis (2010) (n. 1), Conejero Roos, 50 Years of the New York Convention (2009), 423,Gomez Carriòn (2015) (n. 53), 497. For a contrary opinion see Voser (2009) (n. 41), 394-396. SomeNationalLawsseemtotakeanapproachsimilartotheoneoftheSwissRules,suchasArt.24oftheAustralianArbitrationAct,Art.1045oftheNetherlandsCodeofCivilProceedingsandArt,1696bisofBelgianJudicialCode.

82

international arbitration, have shared this view.58In light of the above, it is self-evident that, with regard to investment arbitration, where in the vast majority ofcases (i.e., in all BIT claims) there is no consent at all until the proceedings arecommenced,thereisnopossibilitytoconsiderjoinderasavaluabletooltosolvetheissuesgeneratedbyparallelproceedings.Thisshouldbeaddedtothecircumstancesthat,asalreadystated:(i)parallelproceedingsininvestmentarbitrationaregeneratedby a choice of the claimant(s) tomultiply the fora before which a same dispute ispresented;and(ii)BITscontainverystrictnationalityrequirements,whichprecludetopartiesofallnationalitiestobejoinedtoanalreadypendingBITarbitrationinlackofanexplicitagreementofallthepartiesinvolved(inthislastcase,aftertheconsentisgiven,thebasisfor jurisdictionofthearbitraltribunal isnotBITbutthenewparties’agreement).

Anyway,itshouldbetakenintoaccountalsothat,inordertoextend59arbitraljurisdictiontothirdpersonsinlackofanexpressconsent,Authorshavetriedtolookatcertainsituationswhichcouldbeconsideredassubrogatesofconsent,i.e.to:(i)formsofimplicitconsent,(ii)factualsituationsinwhichconsentcannotbeconsideredasnotexistent,and(iii)behavioursthatcanbeinterpretedassubstitutesforconsent.

Amongthetechniquesusedtolookforanon-expressedconsenttoarbitrationwecanmainlyidentify:(i)thegroupofcompaniesdoctrine;(ii)thetheoriesbasedoncontract law; and (iii) a theory based on the concept of “dispute”. It will bedemonstrated that all these theories present several problems that impede us toaccept them as a feasible solution to allow joinder and therefore to avoid parallelproceedingsininvestmentarbitration.Infactthesetheoriesareonlyaimedatfindinga substitute for consent in a single arbitrationwithout effectively offering a tool toprevent the multiplication of proceedings. Indeed, it is highly probable that, in asituationofparallelproceedingsstartedwiththeaimofmultiplyingtheforathatcanhearadispute(suchastheoneweareanalysing),consentofalltheinvolvedpartiestoasingle forumdoesnotactuallyexist.Supportingthesetheoriestoallowa joinder ininvestment arbitration, therefore,wouldmean falling into a loop: itwouldmean toextendjurisdictiontoanonsignatorypersononthebasisofaconsentthatdoesnotexist,whilejurisdictioninarbitrationisbynaturebasedonconsent.Indeedthetruthisthat a solution to the problem of parallel proceedings cannot be found at thejurisdictionalstagewithoutavoidingfallingintoaresearchforconsent.Furthermore,

58Townsend, International Arbitration 2006: Back to Basics? (2007), 359 and ss., Barin, InternationalArbitration2006:BacktoBasics?(2007),375andss.,Voser(2009)(n.41),347,MantillaSerrano(2010)(n.37),24,Bond,MultipartyArbitration(2010),35andss.,Cox,MultipartyArbitration(2010),49,Bove(1995)(n.44),786andss.,Voser,Meier,AustrianYearbookonInternationalArbitration(2008),115andss., Swoboda, Journal of Dispute Resolution (2011), 465 and ss., Polinari (2006) (n. 37), 537, Byrnes,Pollman, Harvard Negotiation Law Review (2003), 289 and ss., Lamm, Aqua, George WashingtonInternationalLawReview(2003),714andss.59Theword“extension”hasbeencriticizedbyHanotiau(2006)(n.37),4andss.,whostatedthatit“ismisleading,and,moreover,isprobablywrongtoalargeextentsince,inmostcases,courtsandarbitraltribunalsstillbasetheirdeterminationoftheissueontheexistenceofacommonintentofthepartiesand,therefore,onconsent”.

83

the lack of a real consent by the party to be joined would also mean that thenationality requirementofBITs is not satisfied and therefore there is a strong legalobstacletojoinapersonthatdoesnothavethenationalityofoneofthetwoStateswhichsignedaBITinproceedingsstartedundersuchBIT.

Accordingtothegroupofcompaniesdoctrine“arbitrationagreementsmaybeextended tootheraffiliate companyofa contractualpartyprovided that such ‘non-signatory’was somehow involved in the conclusion, performance or termination ofthecontractindispute”.60ThedoctrinehasbeenappliedintheverywellknowncaseDowChemicalv.IsoverSaintGobain,61inwhichthearbitraltribunal“considereditwasnotboundtoapplyanynationallaw,butfreetoapplyinsteadwhatisconsideredtobeinternationaltradeusagesrelatingtogroupofcompanies”.62Thetribunalstatedthatprevious ICC decisions “progressively create case law which should be taken intoaccount, because it draws conclusions from economic reality and conforms to theneedsof internationalcommerce,towhichrulesspecificto internationalarbitration,themselves successively elaborated, should respond”.63Having therefore found thatall the claimants were part of the same group of companies and that they hadparticipated in the conclusion, performance and termination of the contract (suchinvolvementbeingknownbyalltheotherparties),notwithstandingthefactthatnotalltheseclaimantsweresignatoriestothearbitrationagreement,thetribunalstatedthat“irrespectiveofthedistinct juridical identityofeachof itsmembers,agroupofcompanies constitutes one and the same economic reality (une réalité économiqueunique) ofwhich the arbitral tribunal should take accountwhen it rules on its ownjurisdiction” 64 and therefore accepted jurisdiction on all the abovementionedclaimants.

Anyway, “it is important to note that the tribunal did not abandon therequirementforconsent,butmerelyconsideredthat, intheparticularcircumstancesof the case, consent of all the parties was implied”:65“in the present case, thecircumstancesandthedocumentsanalysed(…)showthatsuchapplicationconformstothemutualintentoftheparties”.66

60Wilske,Shore,Ahrens,TheAmericanReviewof InternationalArbitration(2006),74.Withregardtotheautonomousstandingandtheraisond’étreofthisdoctrineseetheanalysisconductedbyFerrario,Journal of International Arbitration (2009), 647 and ss. For an in depth analysis of the case law andscholarshiprelatedtothedoctrinerefertoBrekoulakis(2010)(n.1),150andss.SeealsoPark(2009)(n.2),22andss.SeealsoMayer,MultiplePartyinInternationalArbitration(2009),189andss.,Hanotiau,PervasiveProblemsinInternationalArbitration(2006),279andss.61ICCCaseNo. 4131, 23 September 1982, 9Y.B.Comm.Arb. 131 (1984). Thepremises are perfectlydescribedbyWilske,Shore,Ahrens(2006)(n.60),75:“VariouscompaniesoftheDowChemicalgrouphad brought arbitration proceedings against Isover Saint Gobain even though not all of them hadenteredintotherelevantdistributioncontracts,whichcontainedarbitrationclauses”.62Wilske,Shore,Ahrens(2006)(n.60),7563DowChemicalv.IsoverSaintGobain,136.64Ibid.65Wilske,Shore,Ahrens(2006)(n.60),76.SimilarconclusionshavebeenreachedbyHanotiau,JournalofInternationalArbitration(2001),271-272.66DowChemicalv.IsoverSaintGobain,136-137.

84

Whilethisdoctrinehasfound largeapplication inFrance,67it“hasneverbeenuniversallyacceptedand itmighthaveexperiencedmorecriticismthansympathy inthearbitrationcommunity.Thedoctrinehasconsequentlybeenrejectedbynumerousarbitraltribunals.Arbitraltribunalsinanyeventstressedthattheexistenceofagroupwas not per se sufficient to justify the extension of an arbitration agreement andproceededtoathoroughevaluationofthefactsconfirmingordisprovingtheparties’intentiontobebound”.68

Inlightoftheabove,andconsideringthealreadymentionedlackofconsenttojoinderincasesofparallelproceedingsininvestmentarbitrationarisingfromseveralclaims brought by entities of the same group, it does not seem possible to makerecoursetothegroupofcompaniesdoctrine,duetothecircumstancethatitdoesnotseempossibletodisregardthecommonintentionofthepartiestoarbitrate.69

Furthermore,andmost importantly, it isworthnotingthattheapplicationofthegroupofcompaniesdoctrinecouldrisktonotsatisfythenationalityrequirementsof the relevant BIT in case the third person to be joined in the arbitration (i.e. thecompanyof thegroupwhichdidnot sign thearbitrationagreement)doesnothavethesamenationalityoftheclaimant.

Inthecontextofinternationalcommercialarbitrationsomealternativestothegroup of companies doctrine have been developed by US Courts and scholarship.Suchpossible remedies to theproblemofparallelproceedingshavebeenborrowedbycontractlawandarethereforestrictlyrelatedtotheexistenceofacontract.70Thereference goes to the following doctrines: (i) incorporation by reference; 71 (ii)assumption; 72 (iii) piercing the corporate veil; 73 (iv) agency; 74 and (v) estoppel.

67Hanotiau(2006)(n.37),48andss.68Wilske,Shore,Ahrens,(2006)(n.60),77-78;theAuthorsrefertoICCCaseNo.5721,CollectionofICCArbitralAwards II,400(1994); ICCCaseNo.9517,16(2) ICCBull.80(2005); ICCCaseNo.10818,16(2)ICC Bull. 94 (2005). The doctrine has been strongly rejected by Sandrock, The International Lawyer(1993), 941 and ss. For an analysis of thedevelopmentof thedoctrine inSwitzerland seeHabegger,EuropeanBusinessOrganizationLawReview(2002),517andss.,andZuberbuhler,ASABulletin(2008),24andss.,while for theanalysisof theEnglishcase law in referencetothedoctrineseeWoolhouse,ArbitrationInternational(2004),435andss.ItisworthemphasizingthatEnglandhasalwaysbeenthestrongest opposer of the doctrine.With regard to USA, as it will be shown below they havemaderecoursetoothertoolstoextendarbitraljurisdictiontothirdpersons.69SeeBrekoulakis(2010)(n.1),192-198.70SeeHosking(2004)(n.2),490andss.,Hanotiau,(2001)(n.65),255andss.,Brekoulakis(2010)(n.1),28andss.71 “Incorporation by reference applies when a party signs an agreement that incorporates, orreferences,asecondagreementwhichincludesanarbitrationclause.Evenifthepartydidnotsignthecontract including the arbitration agreement, it will be compelled to arbitrate because it signed thecontractreferencingthecontractrequiringarbitration”.Courtney,RichmondJournalofGlobalLaw&Business(2009),586.72“Anon-signatorymaybeboundunderthetheoryofassumptionifhemanifestedintenttoarbitratethroughhisconductandanotherpartyreliedonthatconduct.Theideabehindthistheory isthatthenon-signatory should be allowed to express intent to arbitrate and then later assert that an arbitralawardisinvalid.Thenonsignatorywillbeconsideredtohave‘impliedlyagreedtoarbitrate’”.Courtney(2009)(n.71),586.73“Veilpiercing isatermwell-knownincorporate law. Itcanbindanon-signatorytoanagreement iftheagreementwassignedbytheparent,subsidiary,oraffiliateofacorporation.Courtshavejustified

85

Considering that, as stated above, joinder can be a useful tool only in parallelproceedingsarisingfrommultipleclaimsbyentitiesofthesamegroupunderdifferentBITs,thevastmajorityofsuchtheoriesarenotusefultojustifyajoinderininvestmentarbitration,duetothefactthatincaseofBITclaimsthereisnocontractatall(indeed,wetalkaboutarbitrationwithoutprivity).Theoriesbasedoncontractlawareuselessifthereisnocontract!

Theonlytheorythatcanofferasolutioninthecaseathandisthedoctrineofarbitralestoppel.FewAuthorshavegivenattentiontotheapplicationofthisdoctrinein international arbitration. 75 According to Prof. Brekoulakis “[t]he doctrine ofequitable estoppel reflects the general legal principle of ‘non venire contra factumproprium’ (…):aparty ispreventedfromassertingrightsagainstanotherpartywhenthe latter justifiablyreliedontheconductoftheformerandchangedhispositiontohisdetrimentasaresultofsuchreliance.Theprinciple,asitsnameindicates,isbasedonfairandequityconsiderations,whichmakes itdifficulttodelineate. Inarbitrationthe theory has developed a specificmeaning (…). The termarbitral estoppel betterreflects the specificmeaning of the doctrine in the context of arbitration and non-signatory parties. The doctrine has been relied upon by the US courts to estop asignatory party from avoiding arbitrationwith a non-signatory, but also to estop anon-signatorypartyfromavoidingarbitrationwiththesignatoryparty”.76Aspointedout by Brekoulakis,77two versions of the doctrine of arbitral estoppel have beendevelopedbyUSCourts:equitablearbitralestoppelandintertwinedarbitralestoppel.

“Theequitableversion isbasedon thesuggestion that ifapartyattempts toexerciserightsunderacontract,whichcontainsanarbitrationclause,thenthispartywillbenormallyboundbythearbitrationclausetoo.Herethecrucialfactoriswhetherthepartyseekingtoavoidarbitrationhasgainedanysubstantialdirectbenefit fromthe contract including an arbitration agreement”. 78 This version of estoppel is

piercingthecorporateveilinsituationstopreventfraudorotherwrong,orwhereaparentdominatesandcontrolsasubsidiary.Itisaveryfactintensiveanalysisandcourtstendtoonlyapplythistheoryinegregiouscircumstances”.Courtney(2009)(n.71),587.74Agency“isrootedintraditional lawsofagency.Agencyis:therelationshipthatexistsbetweentwopersonswhenone,calledtheagent,isconsideredinlawtorepresenttheother,calledprincipal,insuchawayastobeabletoaffecttheprincipal’slegalpositioninrespectofstrangerstotherelationshipbymaking of contracts. A principal may be bound to an arbitration agreement signed by the agent.However theremusthavebeenan agency relationship andwhen the contractwas signed the agentmusthavebeenacting‘withinthescopeoftheagencyrelationship’.Problemsarisewhentheprincipaldoes not want to arbitrate and where there is no contract between the principal and the agent”.Courtney (2009) (n. 71), 586-587.On the issueof veil piercing seeTyler,Kovarsky, Stewart,MultiplePartyinInternationalArbitration(2009),149andss.,referringinparticulartotheverywellknowncasesBridasS.A.P.I.C.v.GovernmentofTurkmenistan,345F.3d347(5thCir.2003),cert.denied,543U.S.937(2004) and 447 F.3d 411 (5th Cir. 2006), cert. denied, 127 S. Ct. 664 (2006). See also Koutoglidou,MultiplePartyinInternationalArbitration(2009),255andss.,Stoehr,WashingtonandLeeLawReview(2009),1409andss.75See, inter alia, Brekoulakis (2010) (n. 1), 131 and ss., Hanotiau (2001) (n. 65), 263 and ss., Hosking(2004)(n.2),529andss.,LaForge,TexasLawReview(2005-2006),225andss.76Brekoulakis(2010)(n.1),131-132.77Id.133andss.78Id.,133.

86

conceptuallyinappropriatetojustifyajoindertoavoidcasesofparallelproceedingsininvestment arbitration. Indeed, in the cases analysed in this paragraph, first of all,there is no contract at all, and, secondly, it is not possible to draw up an analogybetweenthecaseofapartywhichtakestheadvantagesofacontractandthecaseofapartythatgetstheadvantagesofaBIT,duetothefactthattheonlypersonswhichcantaketheadvantagesofaBITinaStatearethepersonswhohavethenationalityoftheothercontractingState.79

In the intertwined version of arbitral estoppel “the courts attach lessimportance to whether the party avoiding the arbitration agreement has gained asubstantive and direct benefit from a contract containing the arbitration clause.Instead, courtswill enjoin a signatory to arbitrate its claim against a non-signatory(andviceversa)iftheyaresatisfiedthata‘tightrelatednessoftheparties,contractsandcontroversies’exist.(…)courtswillusuallyfocusonthefollowingtwoconditionswhichmustapplyconcurrently:

- first, thedisputebetween the signatory and thenon-signatorymustbeintertwinedwiththecontractcontaininganarbitrationclause,and

- second, the non-signatorymust have contractual or close corporatelinkswithoneofthesignatories”.80

Thisversionofthedoctrineofarbitralestoppelseemsmoresuitabletojustifyajoinder in investment arbitration. Indeed, the fact that it is not focused on theexistenceof a contract but on the relationship existingbetween the various partiesanddisputesplays in favourof suchsuitability. It couldbe therefore said thatwhentwo closely interrelated entities of a group get the advantages of the same treatyprovision,theywillbeestoppedtoarbitratethesamedisputeseveraltimesandtheyshallmandatorilybringallclaimsagainstthehostStateinthesamedispute.However,this very suggestive idea does not keep into consideration the nationalityrequirement:usually thevariousentitiesofa corporatechaindonothave the samenationalityandthereforetheywillnotbeentitledtoarbitratethesameclaimunderonly one BIT. Hence, again, to have all the claims heard before only one arbitraltribunal therewouldbe theneedofanewconsentofall theparties involved in thetransaction (inorder to let thearbitrationarise fromthenewarbitrationagreementand not from the BIT). In conclusion, if the theory of intertwined estoppel has theadvantageofthwarttheimportanceoftherequirementofconsent(evenif,accordingto Brekoulakis, such requirement is still requested in practice by the courts),81such

79Finally, this doctrine seems to completely ignore the doctrine of separability of arbitration clauseswithin a contract in international commercial arbitration. See Lew, Mistelis, Kroll, Comparative andInternationalCommercialArbitration(2003),101andss.OnseparabilityinBITsseeZarra,TheAmericanReviewofInternationalArbitration(2014),593andss.80Brekoulakis(2010)(n.1),135.81Brekoulakis(2010)(n.1),178-179,statesthat“thefactthatthedisputebetweenthesignatoryandthenon-signatory is intertwined with the contract containing the arbitration clause” is a fact patternanalysiswhich“arguablydemonstrateassenttoarbitrate”.“Thusneitherthearbitralestoppelnorthegroupofcompaniesdoctrineeverdevelopedasaseparateandautonomousbasisof jurisdiction.Thetrueessenceofthesedoctrineshasbeentopresumeoratleastfacilitatethedeductionofconsent.(…)

87

theory cannot be considered a useful tool to justify a joinder in internationalinvestmentarbitration.82

The final theory that has been developed in order to bind third persons toarbitraterequires“ustofocusnotonputativeconsentofnon-signatories,butonthescopeofthedisputesubmittedforarbitrationandthescopeoftheoriginalarbitrationclause. If a dispute strongly implicates a non-signatory and is covered by a broadarbitrationclause,a tribunalwillhave jurisdictiontodecidethedispute,even if thatmeans that it has to assume jurisdiction over a party that has not signed thearbitration clause” (emphasis in original).83 This theory, which has been alreadycriticizedwhenithasbeenproposed,84presentsvariousgapsandisfinallyfallaciousto constitute the base for binding non-signatories avoiding a consent basedreasoning.Furthermore,aswewillsee,itcouldneverbethebasistojustifyajoinder

Itfollowsthatnon-signatorytheoriesfailtolookoutsidetheconsensualcontext,andarguablymisstheopportunitytolookintotheinterestsofthirdpartiesstrictosensuandexaminewhetherandunderwhatconditionsanysuchpartymayhavearoleinarbitration.Naturallythus,allthirdpartiesstrictosensuarestillaltogetherexcludedfromthearbitrationprocess”.Thisassertionseemsunfoundedintworegards.Firstofall,itdoesnotseemtruethattheintertwinedversionofarbitralestoppelisbasedonconsent.On the contrary it seems based on equity and justice consideration according towhich if there is astronginterrelationbetweentwoentities(tobeanalysedonacasebycasebasis),suchentitiescannotavoid to consider themselves bound by the acts of another. This is demonstrated also by Fellas,Conference Materials of the School of International Arbitration 30th Anniversary Conference: “TheEvolutionandFutureofInternationalArbitration:TheNext30Years”(2015),13,accordingtowhom“the‘intertwinedestoppel’theoryisonedevelopedspecificallyforthearbitrationcontextandappearstobebasedonsomeintuitivesenseoffairnessmorethansomerobustnotionofreliance:itdoesnotseemunfairtorequireapartythathasalreadyagreedtoarbitrateonedisputewithonepartytoarbitrateanintimatelyintertwineddisputewithanotherparty”.Secondly,interestofthirdpartiesstrictosensuarebynatureexcludedfromanarbitrationandthiscannotbeseenasasurprise!Atmost,thepresenceofthirdpersonsinarbitrationcanbejustifiedbytheinterestofthetwopartiesoriginallyinvolved(i.e.thepartywhichhassignedanarbitrationagreementonlywithoneofthestrictlyinterrelatedentities)andnot to safeguard the interest of a third personwhich is excluded from the arbitration from the verybeginningofit.Brekoulakis’s critics to intertwinedestoppelgoeson stating,at 179, that: “it isquestionablewhetherthefactpatternsdevelopedinthecontextofnon-signatorytheoriesmaysafelywarrantthedeductionof intent toarbitrate”.Thisassertionseemswrongbecause,aswehave tried todemonstrateabove,intertwinedestoppelisnotbasedonconsentandisnotasubstitutionforit.Itisforthisreason(i.e.thefactthat it isnotbasedonconsent) thatestoppelhasattractedsomecritics.SeeHanotiau (2001) (n.65), 265 andUnited States Court of Appeal for the SecondCircuit inThomson-CSF S.A. v. AmericanArbitrationAssociation,64F.3d773(2ndCir.1995).82InChapter3wewillconsiderthedoctrineofintertwinedestoppelonceagaininordertoseewhetheritcanplayaroleintheextensionofresjudicatatothirdparties.83 Brekoulakis, Conference Materials of the School of International Arbitration 30th AnniversaryConference: “The Evolution and Future of International Arbitration: TheNext 30 Years” (2015), 38. TheAuthor,at39,goesnostating“whetheracertaindisputecan(“kiss”and)awakenthejurisdictionofanarbitraltribunaldependsonthescopeofthearbitrationagreement”.Forthereasonswewillseebelow,thisapproachiscompletelyfallacious.84Fellas(2015)(n.81),criticizedBrekoulakis’sapproachbecause it ignorestheoriesbasedoncontractlaw.Voser,ConferenceMaterialsoftheSchoolofInternationalArbitration30thAnniversaryConference:“The Evolution and Future of International Arbitration: The Next 30 Years” (2015), 1 and ss., stronglycriticizes Brekoulakis because he fails to give importance to the requirement of consent, on whicharbitration isnaturallybased. Intheopinionofthepresentauthor,as itwillbeseenbelow,problemsarenotrelatedtothelackofconsent,butontheinconsistencyoftheproposedapproach.

88

in investment arbitration, due to the already analysed problems related to thenationalityrequirement.

In fact, focusing on the scope of arbitration clause, means to focus on theboarders that thepartieshavedrawn for theirdispute throughanarbitrationclausethat theynegotiatedandonwhich theyhavegiven their consent (sic!).Hence,whenBrekoulakis says that his theory avoids falling into a consent based reasoning he isinconsistentwith the realityof the fact:everythingarises fromarbitrationclauses isconsensualbynature!85

In light of the above, we cannot ignore that the parties have given theirconsent toarbitrateacertaindisputethroughanarbitrationclauseonly to theothersignatorypartyofthatarbitrationclause.Thereforenotonlythisapproachmissesthepointoftheconsensualnatureofarbitrationagreement,buterroneouslyalsotriestosurreptitiouslyextendaclearlyexpressedconsenttopersonswhicharenotboundbysuchconsent.

Giventheaboveconsiderations,itiseasytosaythatifaStateinaBITgivesitsconsent to arbitrate disputes related to such BIT against nationals of the othercontracting State of the BIT, it is not possible in investment arbitration to extendjurisdictionofarbitraltribunalstonationalsofStatesotherthanthetwocontractingStatesbykeepingintoconsiderationthebroadnessoftheword“dispute”containedinthearbitrationclauseoftheBIT.

On the basis of all the above, joinder cannot be considered as a usefulinstrumenttoavoidparallelproceedingsininvestmentarbitration.

2.1.2.2 ConsolidationConsolidation is “the act or process of initiating into one single case several

independent proceedings which are pending or initiated”.86This remedy to parallelproceedings has emerged in the context of commercial arbitration but has beenwidelydiscussed (andsometimesapplied)also inparallelproceedings in investmentarbitration. Consolidation is generally referred to as a mechanism to avoidcontradictoryjudgmentsandtoensureefficiencyandfairness.87Withreferencetothe

85As it will be shown in Chapter 3 below, focusing on the concept of dispute and on the legalrelationship underlying the claim that is brought before the arbitral tribunal is essential in order tounderstandthescopeoftheaward.However,theseconceptsarenotrelevant inordertoexpandthejurisdictionofthetribunal.86Pair,Consolidationininternationalcommercialarbitration(2012),10.VariousAuthorshaveexaminedconsolidation.See, interalia,Cremades,Madalena(2008) (n.35),532andss.,Hackman(2009),1andss., Hoellering, Dispute Resolution Law Journal (1997), 41 and ss., DeCamp, Journal of DisputeResolution (1994), 113 and ss., Gillies, Hymel, Asia Pacific LawReview (2009), 169 and ss., Hascher,Journal of International Arbitration (1984), 127 and ss., Barron, Journal of International Arbitration(1987),81andss.,Aiken(2009),1andss.,Kazutake,AnnualSurveyof InternationalandComparativeLaw(2003),189andss.87Ibid. See also Chiu (1990) (n. 51), 53 and ss., Stipanowich (1986-1987) (n. 6), 488 and ss., Pryles,Waincymer, www.arbitration.icca.org (2009), 41 and ss., Crivellaro (2005) (n. 25), 400 and ss.,Kaufmann Kohler, Boisson de Chazournes, Bonnin, Mbengue (hereinafter Kaufmann Kohler et al.),

89

scenarios outlined in Paragraph 2.1.2 above, consolidation might be, in principle,useful in all of them:88consolidation does not require strict identities of the partiesinvolvedinthetwoproceedingsandcouldhave,inprinciple(aswillbedemonstratedbelowwhenreferringtotheSoftwoodLumberdisputes),aquitebroadapplication.

However,itshouldbefirstofallnotedthatitisnotpossibletoconsolidatetwoproceedings that are not concurrently pending.89Finally, in scenario 2) (i.e. severalclaimsstartedbyshareholdersoftheinvestorcompany)thereareseriousdueprocessconcerns90relatedtotheappointmentofthearbitraltribunalincaseofconsolidationoftwoormoreclaims91andtotheconfidentialityofproceedings.92

Various BITs,93multilateral treaties,94institutional rules95and national laws96makereferencetoconsolidation,but–interestingly–theICSIDConventionandRulesdo not set forth for this method of coordination of proceedings, with an evidentlacuna inthe ICSIDproceduralsystem.Fromananalysisofsuch legalsources,someAuthors have identified the following essential requirements in order to haveconsolidation:9798

ICSID Review FILJ (2006), 81 and ss. Hascher (1984), 132, stated that consolidation involves certainteleological goals: (i) avoiding conflicting awards; (ii) avoiding expenses and costs; (iii) ensureefficiency.Intheend,accordingtothisAuthor,consolidationservestheinterestofjustice.88Withparticular regard to scenario 3) (i.e. contractand treaty claims),Wehlandhashighlighted thepossibility for a claimant to start together a single claim under various legal sources. SeeWehland(2013)(n.11),115andss.Thisoptimisticscenario,however,isnotsuitableinthecontextofthepresentbook:indeed,theassumptionofthepresentresearchisthatanentitycommencesparallelcontractandtreaty claimswith the aim of taking benefit ofmore than one forum for the resolution of a certaindispute.ThepossibilityofstartingoneclaimunderdifferentsourceshasbeenacceptedalsobyLuiso,Rivistadell’arbitrato(2007),604andss.89Wehland(2013)(n.11),109-110and119.90See Yannaca-Small, OECD International Investment Perspectives (2006), 237 and ss. The Authorstates that, increasing the complexityof theproceedings, consolidation increasesalso themarginoferrorsbyarbitrators.Arbitrators,moreover, shall give to theparties full opportunity topresent theircasel91PleaserefertoParagraph2.1.2.1above.SeeYannaca-Small,(2006)(n.90),236.92Thisissuewillbebetterexaminedbelow.93E.g.,Art.33oftheUSModelBIT,Art.32oftheCanadaModelBIT,Art.10.26oftheAustralia-ChileFreeTradeAgreement.94Seeart.1126NAFTAandII.27oftheTPP.95SeeArt.10of2012ICCRules,Art.4(1)oftheSwissRules.SeealsoPair(2012)(n.86),15andss.ForadetailedanalysisofArt. 10of the ICCRules, seePair,Frankenstein,Emory InternationalLawReview(2011),1061andss.Seealso,forananalysisofthe1998ICCRuleonconsolidation,Whitesell,MultiplePartyActioninInternationalArbitration(2009)203andss.96E.g. Article 1046 of The Netherlands Code of Civil Procedure and Section 6B f the Hong KongOrdinance,whichmakereferencetoaformofcourtorderedconsolidationofclaims.Section35oftheEnglish Arbitration Act andmany others, on the contrary, require express consent to consolidation.See, for other references, Yannaca-Small, (2006) (n. 90) 229. For an analysis of a US approach seeKerner,WashingtonUniversityLawQuarterly(1991),349andss.97SeeKaufmannKohleretal.(2006)(n.87),85andss.98Withregardtotheentitythathastotakethedecisiontoconsolidate,variousmodalitieshavebeenusedininternationalinvestmentlaw.Thereferencecango,interalia,toaconsolidationtribunal(suchasinthecaseofart.1126NAFTA),tothearbitraltribunalitself(suchasinS.35oftheEAA),tonationalCourts(suchasinart.1046ofTheNetherlandsCodeofCivilProcedure).Ininvestmentarbitration,theinitial request to consolidate is usuallymade to a thirdperson; this canbe,e.g., the ICSIDSecretaryGeneral(seeArt.1126.3NAFTA).Thispersonwillthenestablishaconsolidationtribunalthatwilltake

90

- consentofall theparties to consolidate:parties shall express,directly(throughanexpressagreement)orindirectly(byreferringtotreaties,rulesornationallawswhichcontainanexpressconsolidationprovisionintheiragreement)theiracceptanceforconsolidation. In investmentarbitration, when two arbitrations are pending under two differentBITs, if thepartiesdonotexpresslyagreeonconsolidation, theonlyway to have consolidation on request of only one party is the casewhenbothBITsinvolvedprovideforconsolidation,duetothefactthatin this caseall thepartiespreviouslyagreedonconsolidation. In thisregard it should be noted that – if the sources of consent do notalready provide for consolidation – it is unlikely that the partieswillgivetheirconsentafterthedisputehasarisen,inlightofthefactthatthey have taken “a deliberate decision to commence a secondarbitration”;99when there is an arbitration under the NAFTA (andtodaytheTPP)it isprovidedthat,accordingtoArt.1126NAFTAandArt.II.27TPPapartycanaskforconsolidationincasetherearetwoormore disputes arising from the same State measure (i.e. having aquestion of law or fact in common). Considering that starting anarbitrationunderthesetreatiestheinvestorimplicitlyacceptedtheserules(andthisconstitutes, inprinciple,asufficientbasisforconsent),once the request for consolidation is made during the proceedings“party autonomy is not relevant for considering a consolidationrequestunderArticle1126”.100

- connexity of the cases to be consolidated: some treaties require“questions of law or fact in common”,101others refer to disputes“arisingfromthesamecircumstances”.102

- identity of dispute settlement mechanisms: if the mechanisms ofdispute resolution are very different, it is almost impossible to

thedecisiontoconsolidate.Ithasbeenquestionedwhetherthislastdecisionisanorderthatissubjectornottochallenge.AccordingtoKaufmannKohleretal.(2006)(n.87),102,theorderofconsolidationisnotanawardandisnotsubjecttochallenge,duetothefactthatithasonlyproceduraleffects.Intheopinion of the present author this position is questionable, due to the circumstance that theconsolidationorderhasseveralsubstantiverepercussionontheparties’rightsduringtheproceedings.99Pryles,Waincyer(2009)(n.87),28.Thisiswhyitseemsthatonlyincasethereispreviousacceptanceof consolidation this mechanism seems able to work well. In this last case, in fact, arbitrators (orinstitutional administrators) would be entitled to order a compulsory consolidation upon request ofonlyapartyandwithoutthenecessityof lookingfor theconsentofall theparties involved.Anyway,therehavebeen critics to compulsory consolidation.SeeChi, ssrn.com (2008), 1 and ss.Compulsoryconsolidationhasbeenoperatedalsoinotherfieldsofinternationallaw.SeetheICJSouthWestAfricacases, ICJReports1961,14andss.Seealso theSouth-EasternGreenlandcase,PCIJSer.A/B,No.48(1932),270.Foramoredetailedanalysisofthecaselawininternationallaw(regardingalsotheITLOSandWTO)seeKaufmannKohleretal.(2006)(n.87),104andss.100Yannaca-Small(2006)(n.90),236.101E.g.Art.1126NAFTA.102E.g.Art.10.25CAFTA-DR,Art.33ofUS-UruguayBIT,Art.15.24ofUS-SingaporeFTA.

91

coordinate the two pending proceedings and join them into oneproceeding;103

- fair and efficient dispute resolution: consolidation shall serve theefficientresolutionofthedisputeandtheinterestofjustice.

From an analysis of the case law, however, it appears that, even in case ofparallelarbitrationsinitiatedunderthesametreaty,Tribunalsdidnotapplyuniformlytherequirementsforconsolidation.

AsperfectlyexpressedbyShany,indeed,whenconsideringconsolidation,“thedilemmabeforeusisthuspredominantlyideological:whichoftheconflictingvalues–respectforprivateautonomyortheneedtopromotepublicorder–shouldprevail.Ofcourse, the dilemma has institutional implications. In particular, it raises questionsconcerningtheproperroleofsupervisinginstitutions(…).Aretheymerelydesignedtofacilitate and execute the common will of the parties to arbitrate, or, in thealternative, to ensure the objective attainment of public policy (or systemic) goals?(…)Thismyriadof considerations seems to suggest that itwouldbedifficult, if notindeed impossible, to lay out a general formulation regulating the conditions forconsolidation, which would suit the concerns and capabilities of each legal regimethatgovernsinvestmentorcommercialdisputes”.104

Thislackofuniformityhasbeenstrictlyrelatedtotherequirementofconsent:what if one of the parties, after having expressed its consent to rules providing forconsolidation, clearly shows its unwillingness to consolidate the two parallelproceedings?

Thissituationofuncertaintyandinconsistencyisperfectlydemonstratedbyacomparison of certain disputes arisen in the context of the NAFTA investmentChapter:theCornProducts(CordSyrup)105andCanfor(SoftwoodLumber)106cases.

In the Cord Syrup cases, Mexico asked to consolidate two cases, which,according to the consolidation tribunal, had certain questions of law or fact incommonforthepurposesofart.1126NAFTA(i.e.theyallarosefromStatemeasurespertainingtothesugarmarket).Anyway,theTribunalnotedthatthetwocompanieswere “direct and fierce competitors” and this circumstance would have renderednecessarycomplexconfidentialitymeasuresduringtheproceedingsthatwouldhaverendered consolidation extremely difficult. Consolidation, the Tribunal said, wouldhaverunagainstdueprocess:“thepartiesshouldnothavetocalculatewhichitemsofinformation, evidence, documents and arguments they can share with theircompetitorsandwhichonestheycannotshare”.Therefore,notwithstandingthefact103KaufmannKohleretal.(2006)(n.87),88-89.104Shany,ICSIDReviewFILJ(2006),136.105CornProducts International Inc.v.UnitedMexicanStates, ICSIDCaseN°.ARB(AF)/04/1,andArcherDanielsMidland Company and Tate & Lyle Ingredients Americas, Inc. v. UnitedMexican States, ICSIDCaseN°ARB(AF)/04/5,OrderoftheConsolidationTribunal,7September2005.SeealsoEtteh(2010),11andss.106Canfor Corporation v. United States of America (UNCITRAL),and Tembec et al. v. United States ofAmerica(UNCITRAL),andTerminalForestProductsLtd.v.UnitedStatesofAmerica(UNCITRAL),OrderoftheConsolidationTribunal,20May2005.

92

thatarbitratingunderNAFTAtheclaimantsshouldhavealreadyacceptedArt.1126ofsuchTreaty,“largelybecauseoftheirstrongcompetition,theclaimantsdonotwishtohavetheirclaimsconsolidated”andtheTribunalrefusedtheconsolidationrequestby Mexico. “The Tribunal is persuaded that notwithstanding certain commonquestions of fact and law, the numerous distinct issues of state responsibility andquantum further confirm the need for separate proceedings”. This means, inconclusion, that the satisfaction of the requirements set forth above is not per sesufficienttogivethecertaintythatconsolidationwouldbeoperated.

OppositeconclusionhavebeenreachedbytheSoftwoodLumberConsolidationTribunal.ThethreeclaimantswereCanadianproducersofsoftwoodlumberallegedlyaffected by certainmeasures of theUnited States. The respondent State asked forconsolidation of the three claims on the basis of the fact that the same NAFTAprovisions were involved in the three proceedings. These had factual and legalcircumstances in common. The claimants objected consolidation stating that therewasonly similaritybetween the circumstances, that therewasno riskof conflictingjudgments(astherewasinsteadintheCMEandLaudercases)duetothefactthatthecompanies were not affiliated and that consolidation would have involved severedelays.Inconclusion,claimantsstatedthatconsolidationwouldhavebeenagainsttheconsensual nature of arbitration. The Tribunal, after having recalled in detail thelegislativehistoryandtherationale(i.e.thepolicyconsiderationssetoutaboveandinparticular theefficient resolutionofclaims - in thesenseofproceduraleconomy)ofart.1126NAFTA,citedHenriAlvarez107andstatedthat“Chapter11ofNAFTA(…) isnot the usual private, consensual context of international commercial arbitration.Rather, Chapter 11 creates a broad range of claims which may be brought by anequallybroadrangeofclaimantswhohavemandatoryaccesstoabindingarbitrationprocess without the requirement of an arbitration agreement in the conventionalsensenoreventheneedforacontractbetweenthedisputingparties.Inviewofthis,some compromise of the principles of private arbitration may be justified” (emphasisadded). Hence, after having recalled its discretionary power to order consolidation,the Tribunal did so. Arbitrators specified that the desirability to avoid conflictingawards isnot limitedtocaseswherethepartiesarethesame,butalsoincaseswiththesamelegal issuesarisingoutofthesameeventorrelatedtothesamemeasure.Finally, contrary to theCordSyrupTribunal, theTribunal stated that “concernsoverconfidentiality are, in the view of the Consolidation Tribunal, not relevant whenconsideringarequestofconsolidation,saveforexceptionalcaseswhereconsolidationwoulddefeatefficiencyofprocessorwouldinfringetheprincipleofdueprocess.(…)Thegeneraltrend in investor-Statearbitration istransparencyofprocess,atrendtowhichtheConsolidationTribunalsubscribes.Withintheperspectiveofthattrend,theissueofconfidentialitymustbeapproachedwithcaution.(…)thefactthatpartiestoproceedings are competitors is not unique to consolidation proceedings. (…) It has

107Alvarez,ArbitrationInternational(2000),404.

93

neverbeenseriouslysuggestedthatarbitrationcannotproceedinthosecasesforthemere reason that the parties are competitors and that disclosure of confidentialinformationispurportedlyboundtooccur”.108

In lightofall theabove,even if theapproach takenby theSoftwoodLumberConsolidationTribunalisfullysharedbythepresentauthor,itispossibletodrawthefollowing conclusions. First of all, consolidation is applicable only in very limitedsituations, i.e. proceedings that are concurrently pending, under the sameinstitutional rules and in presence of consent by all the parties to consolidation.109Secondly,evenwhentheaboverequirementsaresatisfied,someotherconsiderations(e.g. the confidentiality of proceedings) may lead arbitrators to not operateconsolidationandmaintaintwo(ormore)separateproceedings.

Thepicturethatemergesisthereforeextremelyuncertainandcannotleadusto see consolidation as a general and reliable remedy to the problem of parallelproceedingsininvestmentarbitration.

2.1.2.3 QuasiconsolidationQuasi consolidation mechanisms are the ones “whereby formally separate

arbitrations areheardby the samepanel of arbitrators and awards are coordinatedbothintermsofsubstanceandtiming”.110Thismechanism,whichisnotprovidedbyanyinstitutionalruleornational law,couldbeuseful inallthescenarios1),2)and3)outlined in paragraph 2.1.2 above, due to the fact that the two proceedings stillproceed in parallel, even if they are heard by the same arbitral tribunal. This hashappenedseveraltimesintheframeworkofICSID.ItisworthnotingtheseveralcasesregardingaluminiumandbauxiteproducersagainstJamaica,whichwereheardbythesame Tribunal and produced identical results.111The same happened in two casesbrought by Italian investors againstMorocco112and in several of the cases broughtagainst Argentina after the economical crisis.113The same happened in the already

108 Softwood Lumber cases, consolidation order, 52-55. On this matter see Guglya, Journal ofInternationalDisputeSettlement(2011),186andss.109Withregardtotheissueofconsent,itisworthconsideringwhathappenedinthealreadycitedCMEand Lauder cases. In these cases, willing to rely only on res judicata, Czech Republic refused theconsolidationofclaimsandtwocompletelydifferentawardswereissued.Duetotheformalitiesrelatedtoconsent, therefore,consolidationwasprecludedandaverybad result fromtheperspectiveof thegoodadministrationofjusticecameout.110Wehland(2013)(n.11),110.111Alcoa Minerals of Jamaica Inc. v. Jamaica, ICSID Case No. ARB/74/2, Kaiser Bauxite Company v.Jamaica, ICSIDCaseNo.ARB/74/3,Reynolds JamaicaMines Limited andReynoldsMetals Company v.Jamaica,ICSIDCaseNo.ARB/74/4.112Salini Costruttori S.p.A. and Italstrade S.p.A. v. KingdomofMorocco, ICSIDCaseNo.ARB/00/4andConsortiumRFCCv.RoyaumeduMaroc,ICSIDCaseNo.ARB/00/6.113See,e.g.,thealreadycitedcasesSemprav.ArgentinaandCamuzziv.Argentina.SeealsoElectricidadArgentina S.A. and EDF International S.A. v. Argentine Republic, ICSID Case No. ARB/03/22; EDFInternational S.A., SAUR International S.A. and Leòn Participationes Argentinas S.A. v. ArgentineRepublic,ICSIDCaseNo.ARB/03/23.OthercasesarereportedbyWehland(2013)(n.11),111-112.

94

cited(seeChapter1)casesrelatedtotheYukossaga(YukosUniversalv.Russia,HulleyEnterprisesv.RussiaandVeteranPetroleumv.Russia).114

Quasi consolidation of proceedings obviously increases the coordinationbetweenthemandlowersthepossibilitythatinconsistentawardsareissued.

However, this form of coordination has still several drawbacks. First of all itdoesnotreducestheexpensesforthehostState,whichstillhavetosustainthecostsof two arbitration proceedings. Indeed, quasi consolidation “does not necessarilypermit rationalizing the use of resources, as submissions, hearings and decisions”which “are often separate for each proceedings. Moreover, this methodmay raiseissuesofdueprocessifaTribunalreliesonknowledgeacquiredinonecasetoresolveanother”.115AsithasbeenstatedbyNicklisch“itis,however,bynomeansalwaysthecaseinarbitrationsconductedinaccordancewiththerulesoftwo-partyproceedingsthat an identical panel of arbitrators will automatically guarantee the avoidance ofinconsistencies.Thereisnocertaintythatthestatementofundisputedfactsmaynotdifferinthetwoproceedingsand,aboveall,thatthetakingofevidencemaynotleadtodifferentresults.Suchdiscrepanciesbetweenstatementsoffactandresultsofthetaking of evidence cannot always be prevented even by an identical panel ofarbitratorsandcanonlybeavoidedbyconcedingtothethird(andfourth)party-evenifonlytoarestricteddegree–therighttoparticipateintheinitialproceeding,andbyensuring that in the second proceeding, the findings of the first proceeding can nolongerbecontestedintheirsubstancebytheparties”.116Finally,quasiconsolidationisstillbasedontheconsentofthepartiesthat–forwhatsoeverreason–maydecidetonotgiveit.

In lightoftheabove–asstated inChapter1– it ispossibletosaythatsomeexamples of quasi consolidation (such as theYukos cases) deserve approval, havingleadtoonesingleawardandtoatotalcoordinationofproceedings.However,thesolefact that quasi consolidation is based on consent brings a very high level ofuncertainty on the reliability of suchmechanism and exclude it from the list of thegeneral solutions to the problem of parallel proceedings; it is, indeed, uncertainwhetherandwhenquasiconsolidationwillbeapplied.Moreover,itisnotpossibletoexcludeapriori that,even inpresenceofquasi consolidation,divergent resultsarisefromtheproceedings.Forthesereason,quasiconsolidationisnotavalidsolutionfortheaimofthepresentbook.

2.1.3 Collectiveproceedingsstartedbyinvestors(inanutshell)

114SeealsoGemplusandTalsudv.MexicoICSIDCaseNo.ARB(AF)/04/4,Award,16June2010.115KaufmannKohleretal.(2006)(n.87),75.116Nicklisch(1994)(n.48),65.TheriskofinconsistentdecisionsevenincasesofquasiconsolidationwasoutlinedbytheHighCourtofHongKongintheShuiOncase,ReShuiOnConstructionLtd.andSchindlerLifts(HK)Ltd,HKLR117(1986),invandenBerg(ed.),14YearbookCommercialArbitration215(1989).SeeMiller,ArbitrationInternational(1987),88.

95

When several investors, which are in the same substantial situation, havingsufferedthesame(orsufficientlysimilar)losseswithinthesameperiodoftimeduetothesamewrongfulactsofahostState,starttogetherasetofproceedingsagainstthehost State, we are in front of collective proceedings started by investors. Theseproceedingshavebeensometimesadmittedininvestmentarbitration117andhavealsobeenreferredtoas“massclaims”.

This definition has generated a widespread debate, due to the fact that,usually,ininternationallawithasbeenusedwithatechnicalmeaning,referringto“aprocess designed to deal with a high number of claims that arise out of the sameextraordinarysituationoreventandarefiledwiththedecisionmakingbodywithinalimitedperiodoftime”.118Ininternationallaw,therefore,mass-claimsarenecessarilydecided on an individual basis by judicial bodies that are judicial or quasi-judicial innature.119OtherAuthors,however,havestatedthatininvestmentarbitrationthereisnodifferencebetween collectiveproceedings startedby investors andmass-claims,duetothecircumstancethatthislastdefinitionshallbeusedinana-technicalsense.ThemajorityoftheTribunalinAbaclat,indeed,statedthat“forthesakeofsimplicityand clarity, the Tribunal will refer to mass proceedings as a qualification for thepresentproceedings,wherebythistermshouldbeunderstoodasreferringsimplytothe high number of Claimants appearing together as one mass, and without anyprejudgmentontheproceduralclassificationofthepresentproceedingsasaspecifickind of collective proceedings recognized under any specific legal order”.120TheTribunal, at para 482, expressly stated thatmass proceedings “fall under themoregeneral conceptof collectiveproceedings”.A similar conclusionwas reachedby themajorityoftheTribunalinAmbienteUfficio.121

Collective proceedings in investment arbitration, therefore, are inspired byclassactionsdevelopedinUSlawandareconceptuallydifferentfrommass-claimsasdevelopedin international law. InUSlawtheclassaction isaproceduraldevicethat“allowsasmallnumberofindividualplaintiffstorepresentalargergroupofplaintiffsinonelitigationproceedingagainstasingledefendantwhocausedasimilarinjurytoall of the plaintiffs”.122In order to have a class action in US law,123the following

117See, interalia,AbaclatandOthersv.ArgentineRepublic,ICSIDCaseNo.ARB/07/5,wheretheclaimshavebeenbroughtby60.000Italianbondholders,andAmbienteUfficioS.p.A.andOthersv.ArgentineRepublic, ICSIDCaseNo.ARB/08/9. SeeKabra,Arbitration International (2015), 425 and ss.A recentdecision involvingthiskindofproceedings isGiovanniAlemanniandOthersv.TheArgentineRepublic,ICSIDCaseNo.ARB/07/8,DecisiononJurisdictionandAdmissibility,17November2014118KosovoHousingandPropertyClaimsCommission,Res.No.7,11April2013,HPCC/RES/7/2003,para.1.4119Van Houtte, McAsey, ICSID Review FILJ (2012), 232. See also Abaclat and Others v. ArgentineRepublic,DissentingOpinion,GeorgeAbi-Saab,28October2011,para.180,andAmbienteUfficioS.p.A.andOthersv.ArgentineRepublic,DissentingOpinion,SantiagoTorresBermudez,2May2013,para.99.SeealsoHeiskanen,MultiplePartyActionsinInternationalArbitration(2009),297andss.120AbaclatandOthersv.ArgentineRepublic,para.180121Paras.119-120122Daly,UniversityofMiamiLawReview(2007),105123Federalclass-actionsuitsaregovernedbyFederalRuleofCivilProcedure23.

96

requirements (whichhavebeenusedalso in international commercial arbitration)124arenecessary:125

1) numerosity requirement: the class shall be so large that a joinderwouldbeimpracticable;126

2) commonality requirement: there are questions of law and of factcommontotheclaimants;

3) typicality requirement: the representative plaintiffs’ claims anddefencesaretypicalofthoseoftheentireclass;

4) representativeness requirement: the representative plaintiffs willfairlyandadequatelyprotecttheinterestsoftheentireclass.

Furthermore, in arbitration it is necessary the consent of all the partiesinvolved:therecanbenoclassactionsinarbitrationifallthepartiesinvolvedhavenotgiventheirconsent.127Thisrequirementislesscontroversialininvestmentarbitrationthan in commercial arbitration. Indeed, the “system of arbitration without privityassumes that the offer is made to more than one potential investor”128and thusnothing in BITs’ wording seems to preclude collective proceedings by investors,consideringthatStates’consenthasalreadybeenprovided.129Onceallthe investorswilldecidetostartaninvestmentclaim,theyareentitledtodoso.

Thedebateregardingcollectiveproceedingsininvestmentarbitrationisstillincourseanditisnotclearwhatwillbetheroleandtheutilityofthisproceduraldevicein the “fight” against parallel proceedings. 130 In particular, with regard to thenumerosity requirement, it shall be highlighted that it is not clear whether it isrequired and what is an adequate number of claimants in order to have collectiveproceedingsininvestmentarbitration.Asoftoday,nocaseininvestmentarbitrationconsidered the numerosity requirement as essential in order to have collectiveproceedings started by investors. In Funnekotter v. Zimbabwe131an ICSID Tribunalheard the merits of a case involving 13 Dutch Investors, without any objection to124Daly, (2007) (n. 122), 105and ss.,Hanotiau,Arbitration International (2004), 39and ss., Lacovara,ArbitrationInternational(2008),541andss.,Jeydel,DisputeResolutionJournal(2002),3andss.125Daly(2007)(n.122),106.126Id., 114, notes that in this case consolidation would not be feasible and would be against theinterestsofalltheparties.Itwouldlengthenandcomplicateproceedings.127SeeAmericanArbitrationAssociation, Supplementary Rules for Class Arbitration (2003). See alsoDeiulemarCompagniadiNavigazioneS.p.A.v.M/VAllegra,198F.3d473,482(4thCir.1999,andChampv.SiegelTradingCo.,Inc.,55F.3d269,275(7thCir.1995).AccordingtotheUSSupremeCourt,whetheran arbitration clause prohibits or allows class actions is for the arbitrators and not for the courts todecide.SeeGreenTreeFinancialCorp.v.Bazzle,123S.Ct.2402(2003),and351S.C.244,569S.E.2d349(S.C.2002).128Kabra (2015) (n. 117), 436. See also Steingruber, ICSID Review FILJ (2012), 241 and Strong, YBInternationalArbitration(2013),288.129Concerning the requirement of consent in collective proceedings under Article 25 of the ICSIDConvention,seeKabra(2015)(n.117),432andss.SomeAuthorshavequestionedisoneofadmissibilityand not one of jurisdiction. SeeKabra, 438 and ss., DeBrabandere, Journal of InternationalDisputeSettlement(2012),614andss.130Pharaon,ArbitrationInternational(2015),589andss.131Bernardus Henricus Funnekotter and others v. Republic of Zimbabwe, ICSID Case No. ARB/05/6,Award,22April2009.

97

jurisdictionbytherespondentState.Iftheapproachtakeninthisdecisionshouldfindconfirmations in the future (and thepresentauthordoesnotsee reasons tosay thecontrary, even in light of previous case law),132collective proceedings by investorscould become a very useful formof coordination of proceedings in cases regardingscenario 2) outlined in paragraph 2.1.2 above (multiple claims by the variousshareholders of a company), provided that all the shareholders have the samenationality (this last circumstance seems not to be very common in today’smultinationalcommerce).133Instead, if itshouldbeascertainedthatafarmore largenumber of claimants is required to start collective proceedings in investmentarbitration (such as in theAbaclat case), this procedural devicewouldnot have anyutility against a limited number of parallel proceedings (as the oneswe are dealingwithinthisbook)andcouldbeusefulonlyinverylarge-scalearbitrations.

However, as in the case of quasi consolidation, collective proceedings arebasedonadiscretionalchoiceoftheclaimants(which,itisworthtorepeat,shallhavethe same nationality) to start collective proceedings. Such procedural device isthereforeagoodformofcoordinationwhenit isusedandwhenit ispossibletomakerecourse to it, but cannot be considered as a general tool to which arbitrators canmake recourse to prevent parallel proceedings. Collective proceedings are not,therefore,avaluablesolutionforthepurposesofthepresentbook.

2.2 Remediesbasedonarbitrators’discretiononly

132Antoine Goetz & Others and S.A. Affinage des Metaux v. Republic of Burundi,ICSID Case No.ARB/01/2, and The Canadian Cattlemen for Fair Trade v. United States of America, UNCITRAL(formerlyConsolidatedCanadianClaimsv.UnitedStatesofAmerica),AwardonJurisdiction,28January2008.133Itisworthnotingthattherecouldbevariousdueprocessandconfidentialityconcernsinrelationtocollective proceedings in investment arbitration. Concerns related to the confidentiality requirementhaveinparticularbeenexpressedbyJusticeScaliainAT&TMobilityLLCv.Concepcionetux.,Certiorarito theUnitedStatesCourt ofAppeals for theNinthCircuit, 27April 2011.Dueprocess concerns arerelated to: (a) the efficient conduct of proceedings; (b) fairness to all disputing parties, which shallmaintain their right tobeheardandtopresent theircase.Therecanbealsoproblemsrelatedto themodalitiesofappointmentofarbitrators.AccordingtoKabra(2015)(n.117),444andss.,the“methodsadopted to manage ‘mass claims’ do not impinge upon parties’ right to a fair hearing, as long astribunalsundertakeindividualassessmentoffacts.(…)dueprocessisnotanendinitself,butmerelyameanstoachieveajustandfairsettlementofadispute.(…)making‘massclaims’inadmissibleresultsina frustratingsituation forboth investorsandstatessincethe former isdeniedaneffective remedyandthelatterbecomessusceptibletopotentiallyconflictingdecisions”.Concerningconfidentiality,asithasbeendonebytheSoftwoodLumberConsolidationTribunal(mentionedabove),itshouldbenotedthatconfidentialityhasalimitedapplicabilityininvestmentarbitration,duetothepublicnatureofthisformofdisputeresolution.Therefore,asstatedbyDaly(2015)(n.122),125“confidentiality(…)isnotanabsolutenotion”andthereforeconfidentialityshoulddeprivearbitrationofthetoolgivenbycollectiveproceedings. Finally, with regard to possible concerns of efficiency, see Daly, 126 and ss., whohighlightsthepositiveandnegativerepercussionsofclassarbitrationsontheefficiencyofproceedings.

Themajorproblemrelatedtocollectiveproceedingsininvestmentarbitrationseemstobethelackofexpertisebyarbitrators in thecasemanagement inscenarios involvingaveryhighnumberofclaimantsandthereforethemanageabilityofthecase.Anotherissuecouldbethecostsandthefeestobesustainedbytheparties incaseswhich,duetotheveryhighnumberodclaimants,presentaveryhighlevelofcomplexity.

98

2.2.1 Forumnonconveniens,comityandthesuspensionofproceedingsItisdisputed,incasesofparallelproceedingsininternationallaw,whetheran

arbitrator,afterhavingascertainedtohavejurisdiction,hasdiscretiontodeclinesuchjurisdiction(ortosuspendtheproceedingspendingbeforeit,waitingforthedecisionof theothercourt)on thebasisofconsiderations related toefficiency,deference tothework of other courts and tribunals and the fair administration of justice. SomeAuthors have expressed the view that arbitrators cannotdecline a validly conferredjurisdiction,134others have said that this could be done only if there is a clearcontestation by a party,135and still others have stated that it is possible for anarbitrator to decline jurisdiction keeping into consideration purposes of justice andefficiency.Amongthis lastcategoryofAuthors, somehaveexpressed theviewthatthepossibilitytodeclinejurisdiction(ortosuspendproceedings)isonlyexceptional,136whileothershaveadvocated“amoregeneroususeofthepossibilitytostaywheretheother forum is overall a more appropriate forum to try the dispute”.137 In thispatchworkof ideas,thenumberofopinionsanddecisions138thatconsiderpossibleaformofsuspensionofproceedingsseemshoweverhigherthanthenumberofAuthorswho do not consider possible this exercise of discretion. For this reason, we willassume (for thepurposeof thisparagraph) that in international law it ispossible tosuspend proceedings or, as we will better see in Chapter 3 below, to declinejurisdictionwhenthegoodadministrationofjusticesorequire.

Twoarethemaintoolsthathavebeenusedbyjudgesinnationallawsystemsinordertoexercisethediscretiontosuspendproceedings:forumnonconveniensandinternationalcomity.

According to the forum non conveniens doctrine, a court may declinejurisdictiononadisputewheneverthereisaclearlymoreappropriateforumwhichcanbetter relatedtothedispute (wecouldsay: thenatural forumof thatdispute),139i.e.

134Soderlund, Journal of International Arbitration (2005), 314, Lew, Parallel State and ArbitrationProceedings(2005),310,Yannaca-Small,TheOxfordHandbookofInternationalInvestmentLaw(2010),1021.135Gaja,TheStatuteoftheInternationalCourtofJustice:ACommentary(2012),579.136Schneider,ArbitrationInternational(1990),111-112.SeealsoBayindirInsaatTurizmTicaretVeSanayiA.S.v.IslamicRepublicofPakistan,ICSIDCaseNo.ARB/03/29,para.271.137Wehland(2013)(n.11).SeealsoCuniberti,ICSIDReviewFILJ(2006),412,Douglas,BritishYearbookof InternationalLaw(2003),264.Lowe,AustralianYearbookof InternationalLaw(1999),191andss.,seemstoadmitthispossibilityinseveralsituation.138SeeAdministrationofthePrincevonPless(Germanyv.Poland),PCIJNo.52Ser.A/B,16(1933),Battusv.Bulgaria, French-BulgarianMixedArbitral Tribunal,11 February 1922, 1R.D.T.A.M., 794,MoxPlantArbitration (Irelandv.UK),Orderof24June2003,42 I.L.M. (2003),para.28.ThispossibilityseemstohavebeenadmittedalsobytheICJintheTimorLestev.Australiacase,Orderof28January2014;onthisdecision see Bonafè, Ordine Internazionale e diritti umani (2014), 331. With reference to ICSIDarbitration,seeSGSSociétéGénéraledeSurveillanceS.A.v.RepublicofthePhilippines,ICSIDCaseNo.ARB/02/6,DecisionoftheTribunalonObjectionstoJurisdiction,29January2004,paras.92,128.139Pauwelyn,Salles,CornellInternationalLawJournal(2009),113.

99

bettersatisfyingtheinterestofthepartiesandtheinterestofjustice.140Ininvestmentarbitration,forumnonconvenienscouldbeinterpretedasfollows:anarbitraltribunaldoesnotexerciseits(alreadyascertained)jurisdictiononadisputewhenitdeemsthatthere is another international tribunal that, for its particular competences, is moreappropriatetohearthedispute.141

Internationalcomityhasbeendefinedinthewell-knownHiltonv.Guyot142caseof1895.Comityhasbeenintendedas“therecognitionwhichonenationallowswithinitsterritorytothelegislative,executive,orjudicialactsofanothernation,havingdueregard both to international duty and convenience, and to the rights of its owncitizens,orofotherpersonswhoareundertheprotectionof its laws”.143Comityhasbeen seen as a “protean concept of jurisdictional respect”144and in internationallitigationhasveryoftenbeenapplied– in itsmeaningofadjudicatorycomity–asaform of deference towards the work of other courts and tribunals, i.e. recognizingdecisions issuedby other courts and tribunals, refraining from judgingon a disputethatisbeingalreadyjudgedinanotherforum(inthisregardcomityisverysimilartoforumnonconveniens)andrefrainingfromissuingorderwhichcaninterferewiththejurisdictionofanotherforum(i.e.anti-suit injunctions,onwhichseeParagraph2.2.2below). In international arbitration, comity could be a form of deference that onetribunal recognizes to other tribunals, refraining from exercising its jurisdiction145(and/or,asitwillbeseenbelow,fromissuinganti-suitinjunctions).

SomeAuthors146believethatthesetechniquessharethesamerationale,i.e.torespectjurisdictionofotherarbitratorsinparallelcases,whileothers147havestressedthatforumnonconveniensisdevotedmoretotheinterestsoftheparties(i.e.thereisamore appropriate forum for both of them to celebrate the proceedings), whileinternationalcomitywouldbeexercisedinviewofthegoodrelationshipbetweentwonational legal systems.Considering that theyhavedifferentorigins148and that theyare applied in different national systems, 149 we will deal separately with their140Hartley,InternationalCommercialLitigation(2015),205andss.SeealsoChildress,VirginiaJournalofInternationalLaw(2012),157andss.141ThisapproachseemstheonetakenbyLowe(1999)(n.137),191andss.142159U.S.113,164(1895).143Ontheconceptofcomity,seeWatson,JosephStoryandtheComityofErrors(1991),1andss.,Paul,HarvardInternationalLawJournal(1991),1andss.,Paul,LawandContemporaryProblems(2008),19and ss., Childress, University of California Davis (20109, 11 and ss., Dodge, Columbia Law Review(2015),1andss.,Bleimaier,TheCatholicLawyer(1979),327andss.144Quaakv.KlynveldPeatMarwickGoerdelerBedrijfservisoren,361F.3d11,at19(1st.Cir.2004)145Shany, Regulating Jurisdictional Relations (2007), 166 has said that exercising comity means “todefer,whenappropriate,toothercourtsandtotreattheirproceduresanddecisionswithcourtesyandrespect”.146JansenCalamita,U.Pa.JournalofInternationalEconomicLaw(2006),606.147Pauwelyn,Salles,(2009),(n.139)112.148ForumnonconveniensdevelopedfirstofallinScottishcourtsandhasthenbeenappliedinEnglandpursuant to the 1987HouseofLords’decision inSpiliadaMaritimeCorporation v.Cansulex [1987]AC460.See,foradetailedanalysisofthisevolution,Hartley(2015)(n.140),205andss.Fortheoriginsoftheconceptofcomity,itisnecessarytorefertoAuthorscitedinfootnote143above.149Comity ismainly applied by US Courts. In other jurisdictions it is possible to find the concept of“reciprocalrespect”.

100

suitabilitytoofferavaluableremedytotheproblemsraisedbyparallelproceedingsininternationallaw.

With regard to forum non conveniens, it immediately emerged that thisdoctrineis“almostexclusivelyknownincommonlawsystemsanditcouldbedifficulttosellitasageneralprincipleoflaw”.150Asaconsequence,itisquestionablewhetherand according towhich law (or powers) arbitrators should be entitled to apply thisdoctrine.Thisquestioncouldbeansweredmakingreferencetotheinherentpowersofarbitraltribunals,but–duetothelackofcaselawregardingtheapplicationofforumnon conveniens by international tribunals – there is not still a clear answer to it.151Secondly,andmost importantly,forumnonconveniens isbynatureadoctrinewhichinvolves a very high amount of discretion by decision makers. 152 Therefore,sometimes forum non conveniens could be wisely used in order to avoid parallelproceedings, but in other cases the result could be opposite. Thismeans that suchdiscretionresultsinthenonreliabilityofthedoctrinetosolvetheproblemsrelatedtoparallel proceedings, due to the non predictability of what the judge will deemappropriatetodo(“tostayornottostay?”,wecouldsay!)intheinterestofjustice.Forthe above considerations, we cannot, in the opinion of the present author, look atforum non conveniens as a possible general remedy to parallel proceedings ininternationalarbitration.153

With regard to international comity, the discourse is similar. Indeed, it isdoubtfulwhether,beingmainlyappliedintheUSnationallawsystem,comityisalsopart of international law and can therefore be freely applied by arbitrators.Furthermore, itcannotbe ignoredthat,even innational legalsystems, internationalcomityhassometimesbeenstronglycriticized154asaveryvagueprinciple thatdoesnotconstituteanyguidanceforjudges.Accordingtothesecritics,asaconsequence,international comity could not offer any form of regulation in case of parallelproceedings.Eventhoughthepresentauthorhasalreadyexpressedtheopinionthatnationaljudgesshouldusetheconceptofcomityinordertolimittheissuanceofanti-suit injunctions,155it is extremely doubtful whether the concept of comity can be avalidtool inordertoprohibitaninternationalarbitratorbyexercisingits jurisdiction.150Pauwelyn,Salles(2009)(n.139),110.FortheapplicationofforumnonconveniensaroundtheworldseeFawcett(ed.),DecliningJurisdictioninPrivateInternationalLaw(1995),1andss.151The question is partially answered (it seems in the negative) by Linton, Tiba, Chicago Journal ofInternationalLaw(2009),423-424.152Thedoctrine(andthediscretionthatitinvolves)hasbeenanalyzedbyamoltitudeofAuthors.See,interalia,Zenjie,NetherlandsInternationalLawReview(2009),143andss.,Heiser,KansasLawReview(2008), 609 and ss.,Hicks, Reviewof Litigation (2009), 659,Hill, Vanderbilt Journal of TransnationalLaw(2008),1177andss.,Juratowich,InternationalandComparativeLawQuarterly(2014),477andss..153ThisopinionissharedbyZoppo(2013),224-226andVirzo,Ilregolamentodellecontroversieneldirittodelmare:rapportitraprocedimenti(2008),269andss.154SeeMann, Foreign Affairs in English Courts (1986), 136, Tan, Virginia Journal of International Law(2005),303andss.ThislastAuthorhasdefinedcomityas“amorphous”andhasstatedthatitshallberegarded“simplyasacautionary reminder”. JudgeCardozocalledcomity“amisleadingword”which“hasbeenfertileinsuggestingadiscretionunregulatedbygeneralprinciples”.SeeLoucksv.StandardOilCo.ofNewYork,120N.E.198,201(N.Y.1918).155Zarra,Rivistadidirittointernazionaleprivatoeprocessuale(2014),561andss.

101

Indeed,asinthecaseofforumnonconveniens,suspendingproceedingsonthebasisofcomity isamereexerciseofdiscretionofthearbitrator,basedonhissensibilityasalawyer, and not the consequence of the application of a precise rule.156Hence, it ispossible to conclude that there is no rule of international law that imposes thesuspensionofproceedingstoanarbitrator.157ThisisconfirmedbytheveryincoherentcaselawofinvestmentTribunalswithregardtotheissueofsuspension.WhileintheSPPv.Egypt158andSGSv.Philippines159casestheTribunals,evenifrecognizingthatthereisnointernational lawrulewhichcompelledthemtodoso,operatedastayofproceedingspending a prior dispute in another forum, in other cases tribunals have“either explicitly or implicitly refused to stay proceedings in favour of a contractualforum”.160

In light of the above (and of the still doubtful question of the discretion ofarbitratorsofstayingarbitralproceedings),evenifwhenappliedcomitycanbeavalidform of coordination among tribunals, it is highly questionable that internationalcomitymaybeproposedasasolutionfortheissuesrelatedtoparallelproceedingsininvestmentarbitration.161

2.2.2 Arbitral anti-suit injunctions and the infringement of kompetenz-

kompetenz

156Wehland(2013)(n.11),211-212,seemstotreatcomityasarulethatinsomecasescouldimposetoarbitratorstostayproceedings.Accordingtohisopinion,therearecertainsituationsinwhichthereisapresumptioninfavorofastayandinwhicharbitratorsshouldnothesitatetodoso.157Thiscritic issharedbyCannizzaro,EuropeanJournalofLegalStudies (2007),statingthatthe legalbasisofcomityandjudicialdiscretionare“uncertain”andtheircontent“indeterminate”.158SouthernPacificProperties(MiddleEast)Limitedv.ArabRepublicofEgypt,ICSIDCaseNo.ARB/84/3,DecisiononJurisdiction I,27November1985,paras.53-56.This isa realcaseofcomitybetweentwointernationalTribunals,duetothefactthattheICSIDTribunalstaidtheproceedingspendingbeforeitwaitingfortheterminationofanalreadypending ICCarbitration,onthebasisofthefactthat“whenthe jurisdictionsof twounrelatedand independent tribunals extend to the samedispute, there isnoruleofinternationallawwhichpreventseithertribunalfromexercisingitsjurisdiction.However,intheinterestof international judicialorder,eitherofthetribunalsmay, in itsdiscretionandasamatterofcomity,decidetostaytheexerciseofitsjurisdictionpendingadecisionbytheothertribunal.159Seen.25above.AccordingtoWehland(2013)(n.11),213,“Themajorityofthetribunal,whilefindingthatithadjurisdictionwithregardtotheinvestor’sclaimsunderthetreaty’sumbrellaclause,tooktheviewthatthecontractualdisputeresolutionprovisionshouldneverthelessbegiveneffect,anddecidedto stay the proceedings so that the Philippine courts could render a decision on the underlyingcontractualissues,Indoingso,thetribunalseemedtobaseitselfbothontheprincipleofcomityandonconsiderationofestoppelandtheprohibitionofvenirecontrafactumproprium”.160Wehland (2013) (n. 11), 213. This situation has very often arisen in case of treaty claims beforeinvestment tribunals and contract claimsbeforenational courts (whicharenotpartofour research).SeeHolidayInnsv.Morocco,ICSIDCaseNo.ARB/72/1,unpublisheddecisionmentionedbySchreueretal.(2009)(n.14),364.InthiscasetheTribunals,whilerefusingtostayitsproceedings,emphasizedthesupremacy of international proceedings over purely internal proceedings. See also CMS GasTransmissionCompanyv.TheRepublicofArgentina,ICSIDCaseNo.ARB/01/8,DecisiononObjectionstoJurisdiction,17July2003,para.76,AzurixCorp.v.TheArgentineRepublic,ICSIDCaseNo.ARB/01/12,DecisiononJurisdiction,8December2003,para.95,Eurekov.Poland(UNCITRAL),PartialAwardof19August2005,para.114,BGGroupv.Argentina(UNCITRAL)Awardof24December2007,para.183.SeealsoseveralothersimilarprecedentsmentionedbyWehland,213,footnote42.161TheaboveconcernsaresharedbyVirzo(2008)(n.153),265-268.

102

An anti-suit injunction is an order, generally issued by common law courts,

whichforbidsapartyfromcommencingorcontinuinganactioninanotherjurisdictionorarbitraltribunal,beforeafinaldeterminationofthedisputeisreachedbythecourtthat issued the injunction.162In case a party does not comply with an anti-suitinjunctionissuedbyanationalcourt,suchpartywillbeliableofcontemptofcourt.163

Case law has showed a general tendency to accept also the possibility thatarbitratorsissueanti-suitinjunctionstorestrainapartyfromgoingonwithadisputeinacourtorinanotherarbitraltribunal.Forthesakeofthepresentbook,wewillonlydeal with anti-suit injunctions issued by an arbitral tribunal in order to restrainproceedingspendinginanotherarbitraltribunal.164

In this regard, in the past it has been several times questioned whetherarbitratorshavethepowertoissueanti-suitinjunctions.165Thiscriticismseemstodayoutdated,duetothefactthatseveraltribunals,inparticularwithintheframeworkofICSID,haveissuedanti-suit injunctionstoprotecttheir jurisdictions.166Thishasbeenconsideredaspartofthepowerofarbitraltribunalsto issueinterimmeasures.167On

162Raphael, The Anti-suit Injunction (2008), 1 and ss., Zarra (2014) (n. 155), 561 and ss., Bermann,Columbia Journal of Transnational Law (1990), 589 and ss., Hartley, The American Journal ofComparativeLaw(1987),487andss.,Atteritano,Rivistadell’arbitrato(2010),441andss.,Gaja,Rivistadi diritto internazionale (2009), 503 and ss., Benedettelli, Rivista dell’arbitrato (2014), 701 and ss.,Goldhaber, Stanford Journal of Complex Litigation (2013), 376 and ss., Barcelò, Cornell Law FacultyPublication (2007), 1 and ss., Fisher, Bond Law Review (2010), 1 and ss., Fernandez Rozas, Anti-suitInjunctions in InternationalArbitration (2005), 73 and ss., Fumagalli, Rivista dell’arbitrato (2005), 583andss.,Phull, Journalof InternationalArbitration (2011),21andss.,Tan (2005) (n. 154),286andss.,Ortolani,MPILuxWorkingPaper(2015),1andss.,Seriki, InternationalArbitrationLawReview(2011),19andss.,Ali,Nesbitt,Wessel,InternationalArbitrationLawReview(2008),12andss.,Chavier,SuffolkTransnationalLawJournal(1990-1991),257andss.163SeeSection37oftheEnglishSupremeCourtActof1981.164Levy,IAIArbitrationSeries(2005),Gaillard,ICCACongressSeries(2007),235andss.,Leandro,Rivistadidirittointernazionale(2015),815andss.,Gaillard,PervasiveProblemsinInternationalArbitration,203andss.(2006)165Gaillard (2007) (n. 164), 240 and ss. The reasons for such critics are, according toGaillard,mainlythree:(i)thatitisimproperforarbitraltribunalstoaddressinjunctionstoStatecourts;(ii)thatanti-suitinjunctions violate the kompetenz-kompetenz of the other court/tribunal involved; and (iii) that anarbitraltribunal issuinganti-suit injunctionswouldbeajudgeinitsowncase.Tothiscircumstancesitcould be also added that, as noted by Benedettelli (2014) (n. 162), 706 anti-suit injunctions can beconsideredlatosensuasorderswithacriminalsanctionandthereforewouldbeoutofthecompetenceofarbitraltribunals.166See Gaillard (2007) (n. 164), 244 and ss., Goldhaber (2013) 376 and ss. The reference goes inparticular to Holiday Inns v. Morocco, decision reported by Pierre Lalive, British Yearbook ofInternational Law (1980), 134,Maritime International Nominees Establishment (MINE) v. Republic ofGuinea, ICSIDCaseNo.ARB/84/4,Awardof6January1988,CeskoslovaskaObchodniBanka(CSOB)v.Slovak Republic, ICSID Case No. ARB/97/4, Procedural Order n. 2 of 9 September 1988, ProceduralOrder n. 3 of 5 November 1998 and Procedural Order n. 4 of 11 January 1999, Société Générale deSurveillanceS.A.(SGS)v.IslamicRepublicofPakistan,ICSIDCaseNo.ARB/01/13,ProceduralOrdern.2of16October2002,TokiosTokelesv.Ukraine,ICSIDCaseNo.ARB/02/18,ProceduralOrdern.1of1July2003.167With regard to interimmeasures in ICSIDarbitration, seeLuttrell,Arbitration International (2015),394andss.,whileconcerninginternationalcommercialarbitrationseeDrahozal, InternationalCouncilforCommercialArbitration,InternationalCommercialArbitration:ImportantContemporaryQuestions(2003), 179 and ss., and Carlevaris, La tutela cautelare nell’arbitrato internazionale (2006), 1 and ss.,

103

this point, it seems thereforeworth to borrow thewords ofwho said that “arbitralanti-suit injunctions are admissible and legitimate if they arementionedwithin thearbitrationrulesofthearbitralseatorwithintheselectedinstitutionalrules.Anyway,the possible unfulfilment of arbitral anti-suit injunctions does not involve criminalsanctions both because arbitral tribunals do not have this power and because‘contempt’ isa formofnoncompliancewithorders issuedbypublicauthoritiesandnot by arbitral tribunals. The remedy against unfulfilment of arbitral anti-suitinjunctionscanthereforeonlybedamages”.168

Hence,assumingthatanti-suitinjunctionscanbeissuedbyarbitraltribunals,itisnowworthconsideringtheadvisabilityoftheissuanceofsuchorders.Inthisregard,itisworthnotingthatanti-suitinjunctionsareinpersonamorders,which,inprinciple,should not interfere with the jurisdiction of the other arbitral tribunal. On thecontrary, however, it is obvious that anti-suit injunctions stronglyde facto interferewith the jurisdiction of the second tribunal, due to the fact that – in case thecompelled party decides to stop the proceedings before it – its jurisdiction will beaffected by an order of another tribunal.169This is, in the opinion of the presentAuthor,aclearandundueinterferencewiththekompetenz-kompetenzofthesecondarbitraltribunal.AsstatedbyLevy,“itisafundamentalprinciplethateach[Courtor]arbitraltribunalhas jurisdictiontoruleonitsownjurisdictionor, inotherwords,haskompetenz-kompetenz”.170Inapreviouspaper,thepresentAuthorhasalreadystatedthat anti-suit injunctions should be only issued by national courts in extremecircumstanceand that judges shouldexercisea very strong restraint in issuing suchorders(againstothernationalproceedings)duetoreasonsofadjudicatorycomity.171Transposing this idea in the field of international arbitration, the present Authorarguesthatinternationalarbitratorscannotissueanti-suitinjunctionswithoutundulyinterferingwith thekompetenz-kompetenz of another arbitral tribunal and thereforeshouldabsolutelyrefrainfromdoingso.172

Kaufmann Kohler, Antonietti,Arbitration Under International Investment Agreements: AGuide to KeyIssues(2010),507andss.,DeBattista(2008).168Leandro,Rivistadidirittointernazionale(2015),818.169SeeAtteritano(2010)(n.162),450-451whosays:“Idonotfeelcomfortablewiththetheoryoftheinpersonamnature of anti-suit injunctions. (…) I think that anti-suit injunctions (…) generate a certaindisequilibriumbetweenthe two judgeswhich isnot justifiedby theNewYorkConventionandwhichgeneratesalsoastrongdisequilibriumbetweenthepartiesinvolvedinthearbitrations”.170Levy(2005)(n.164),117.Theprincipleofkompetenz-kompetenzisunanimouslyconsideredasthefundamental basis of arbitral jurisdiction and isworldwide recognized as such. See, on this principleLew,Mistelis,Kroll,(2003)(n.79),129andss.171Zarra(2014)(n.155),571andss.172Benedettelli (2014) (n. 162), 732. See also Atteritano (2010) (n. 162), seems to share this opinionwhen he says: “We can say that anti-suit injunctions are in personam and not directed to the otherjudge;we can say that theyarebasedon considerationsof conveniencedue to the relationshipof acertainforumwiththedispute;wecansaythatanti-suitinjunctionscouldbehelpfulfortheprosecutionofthearbitration,butthefinalresultisalwaysthesame:ajudgeimposeshisopiniontoanotherjudge!”and this is against theprinciple of kompetenz-kompetenz.According toGaillard (2007) (n. 164), 261andss.,theopportunitytoissueananti-suitinjunctionshouldbeevaluatedonacasebycasebasis.

104

Moreover, even if we would admit that anti-suit injunctions could be easilyissued in international arbitration, case law shows that the arbitral tribunals (theproceedingsofwhichshouldbe,asalreadystated,defactoaffectedbytheorder)cansimplyignoreananti-suitinjunctionandgoonwiththeproceedings.173Itisthereforestronglyarguablethattheefficacyofanti-suitinjunctionsisverylimited,becausethesameprincipleofkompetenz-kompetenzhastheconsequencethatarbitratorsarefreeto determine their jurisdiction and to ignore any order aimed at influencing suchjurisdiction.This is perfectlydemonstratedby theSalini v. Ethiopia174case, inwhichthearbitraltribunalcompletelyignoredananti-suitinjunctionissuedbytheCourtofAddisAbeba, stating thatanarbitral tribunal isonly subject topartyautonomyandcannotbeinfluencedbythedecisionsofothercourtsortribunals.Asimilarconclusionwas reached in several other cases, 175 including the already mentioned SGS v.Pakistan,wherethe ICSIDTribunalcompletely ignoredananti-suit injunction issuedby the Court of Islamabad.176This position has also been confirmed by the EnglishHouseofLordsinDonohuev.Armco,177whenitsaidthat“theriskinherentinananti-suit injunction, if it isunwiselygranted, isthat itwillnotsucceedinstoppingaparty(…)nordissuadethecourtsofothercountriesfromentertainingthelitigation”.

Finally,evenifwewouldbeinclinedtoadmitthatanti-suitinjunctionscouldbeauseful tool toavoidparallel proceedings in investmentarbitration,we shouldalsoconsiderthatsuchordersarecompletelybasedonadiscretionaryexerciseofpowerbythearbitratorsandit isnotpossibletorelyinadvanceontheissuanceofananti-suit injunction (indeed, they could be considered the reverse side of the coin withregardtoforumnonconveniens).

For all the above reasons, in conclusion, it is strongly arguable that anti-suitinjunctions are not a useful tool to manage parallel proceedings in investmentarbitration.

2.3 Conclusions

The present Chapter has highlighted the unsuitability to solve the issue of

parallelproceedingsofalltheremediesthatareapplicableatthejurisdictionalphaseof investment arbitration. As we have tried to demonstrate, in the current legalframework, jurisdiction is necessarily based on consent and it is not possible to

173Tan (2006) (n. 154), 305, Gaja (2009) (n. 162), 506, Hill, Chong, International Commercial Disputes(2010),375.Anotherpossibilityisthatabattleofanti-suitinjunctions,anti-anti-suitinjunctionsandsoonbegins.WiththisregardseeSchimek,BaylorLawReview(1993),499andss.174ICCCaseNo.10623/AER/ACS.175SeeCompanhiaParanaensedeEnergia-COPELv.UEGAraucariaLtda,ICCCaseNo.12656/KGA/CCO,reportedinQuassDuarte,AntitrustandUnfairCompetitionLaw(2010),21.TheTribunalstated:“astheparties have agreed that this Tribunal has its judicial seat inParis and therefore is subject to Frencharbitrationlaw,anydecisionofaBraziliancourtoranyothercourtastothevalidityofthearbitrationagreementisnotbindingontheTribunal”.176Forothercases,seeZarra(2014)(n.155),579andss.177I.L.Pr.21(2000).

105

imagineasituationinwhicharbitratorsextendconsentbeyondtheboarderssetforthbytheparties.Allthetheoriesbasedonaresearchofimplicitconsent(e.g.thegroupof companies doctrine) have been strongly criticized and the theories which try tobypass at all the research of consent (such as Brekoulakis’s theory) miss the realframeworkofarbitraljurisdiction.

As a consequence, remedies such as consolidation and joinder cannot beconsideredasgeneralsolutionstotheproblemofparallelproceedings,duetothefactthat,aswehavetriedtodemonstrate,itishighlyprobablethatoneofthepartieswillnot give its consent to these form of coordination. Furthermore – and mostimportantly– ICSIDConventionandRulesarecompletelysilentonthepossibilitytocoordinateparallel/multipleproceedingsor to join thirdparties and thismeans thatthe only plausible solution is quasi-consolidation (that, indeed, seems the only onethathasbeenappliedinacertainnumberofcases).Suchremedy,aswehavetriedtodemonstrateabove,doesnotgiveanycertaintyontheeffectivecoordinationofthesolutions of the two parallel cases. On the basis of the fact that the majority ofinvestment arbitrations are held in the ICSID framework, we are today stuck in asituation of total lack of rules providing for coordination of proceedings and/orpossibleinvolvementofthirdparties.

ThecurrentsituationininvestmentarbitrationisthereforeoneinwhichICSIDarbitrationdoesnotprovideforanyformofsolutiontoparallelproceedings,whileadhoc arbitration is by naturemore consensual (i.e. similar to commercial arbitration)andthereforestillstrictlyanchoredtotheimpossibilitytoextendtheproceedingstothirdpartieswithoutconsentbyallofthem.

In light of the above, having examined the unsuitability of existing rules tosolvetheissueatstake,itisnecessarytotrytofindasolutiontoparallelproceedingsin the framework of general international law, which, as it will be demonstrate, isalwaystobeconsideredapplicableininvestmentarbitration.ThiswillbethetaskthatwillbecarriedoutinChapter3.

106

SECTION2Remediestotheproblemofparallelproceedings

Chapter3

Abuseofprocess,resjudicataandcollateralestoppel:theavailabletoolsagainstparallelproceedings

Chapter1and2havetriedtodemonstratethatthereisnogeneralremedyto

parallelproceedingsininvestmentarbitrationtobeappliedatthejurisdictionalphaseof arbitral proceedings. As we have seen, this is not surprising. Jurisdiction inarbitration is mainly regulated by party autonomy and there is no chance forarbitrators to decline a validly conferred jurisdiction in case of parallel proceedings.Similarly,wehavedemonstratedthatitisnotpossibletorelyontools,suchasforumnon conveniens and comity,which are solely based on the discretion of arbitrators.Anti-suitinjunctions,inturn,seemtorunagainstthebasisofthewholeinternationalarbitrationlaw,theprincipleofkompetenz-kompetenz.

However, this cannot be the end of the story. We have demonstrated thatseveral policy considerations (i.e. reliability and legitimacy of arbitration as anadjudication process, judicial economy, efficiency and finality) impose to avoid andlimit parallel proceedings. If such policy considerations cannot find a place whenarbitrators consider their jurisdiction, this does notmean that they cannot be keptintoaccountatalaterstageintheproceedings,i.e.theadmissibilityphase.

Indeed,itisstronglyarguablethat,ifattheadmissibilitystagearbitratorshave– as recognized by the vastmajority of authors and tribunals – inherent powers inorder to safeguard the good administration of justice and to ensure the properexerciseof the judicial function, such inherentpowers shallbeexercisedby them inorder to prevent and preclude the continuation of parallel proceedings. The goodadministration of justice would be indeed not ensured if general principles ofinternational law and fundamental canons of judicial proceedings (such as judicialeconomy)areviolatedbythecontinuationofduplicativeproceedings. Chapter3 isthereforeaimedatfindingalegalbasisfortheapplicationoftheabove powers by arbitrators. It will start (Paragraph 3.1) with an analysis of thedistinctionbetweenjurisdictionandadmissibilityininvestmentarbitrationandofthepossiblesourcesofsuchdistinction. Inordertounderstandthelawapplicableattheadmissibilitystage,thediscussionwillthenmovetotheanalysisofthelawapplicableininvestmentarbitrationand,inparticular,totheapplicabilityofgeneralprinciplesofinternationallaw.Itwillbedemonstratedthat,attheadmissibilityphase,arbitratorshavetheinherentpowertoprecludethecontinuationofproceedingsthatareagainstgeneralprinciplesofinternationallaw(Paragraph3.2). Afterhavingexcludedtheapplicabilityoflispendensininvestmentarbitration(Paragraph 3.3), the analysis will then turn on the specific general principles ofinternational law whose violation may be at the basis of a declaration of

107

inadmissibility, namelygood faith andne bis in idem (Paragraph 3.4).Bothof theseprinciples may be applied differently and may be specified in other more specificprinciplesorrules.Inparticular,theprincipleofgoodfaithcangiverisetothedoctrineofabuseofprocess(analysedinParagraph3.5),whilethenebisinidemprinciplehasgenerated the principles of claim preclusion (analysed in Paragraph 3.6) and issuepreclusion (analysed inParagraph3.7). In fact itwill bedemonstrated that abuseofprocess, issue estoppel and, if interpretedbroadly, res judicata are valuable tools inordertoavoid,oratleastlimit,theeffectsofparallelproceedings.However,priortoapplysuchdoctrines,itisessentialtomake,onacase-by-casebasis,acoordinationofany of themwith the principle of due process. In light of the above, wewill firstlyprovide the abstract framework of any of these doctrines and then make anassessmentoftheconcretewaysinwhichtheycanoperateininvestmentarbitration(Paragraph3.8).Finally,andkeepingintoaccountalltheabovediscussion,aproposalto amend investment arbitration rules in order to render themmore effective andpolicyorientedwillbemade(Paragraph3.9).3.1 Jurisdictionandadmissibility.Thelegalbasisforthedistinctionanditsroleinthe

fightagainstparallelproceedings

The distinction between jurisdiction and admissibility is a simple one:“[j]urisdictionreferstothepowerofacourtorjudgetoentertainanaction,petitionorotherproceeding. (…)Bycontrast, admissibility concerns thepowerofa tribunal todecideacaseataparticularpointintimeinviewofpossibletemporaryorpermanentdefects of the claim”.1Therefore, “if jurisdiction reflects legal power – that is, thepower to adjudicate a dispute” – rules of admissibility should be considered “aspertaining to the terms permitting an international court to decline to exercise itslegal powers. In other words, international courts may be authorized not only todecidea legal case,butalso todecidenot todecide it”.2Hence,at theadmissibilitystage, arbitrators keep into consideration “alleged impediments to considerationofthemeritsofthedisputewhichdonotputintoquestiontheinvestitureofthetribunalassuch”.3

1Waibel,LegalStudiesResearchPaperSeries,UniversityofCambridge(2014),2.2Shany,QuestionsofJurisdictionandAdmissibilitybeforeInternationalCourts(2015),47.3Paulsson,GlobalReflectionson InternationalLaw,CommerceandDisputeResolution (2005),617.SeealsoRosenfeld,LeidenJournalofInternationalLaw(2016),137andss.,Williams,TheOxfordHandbookof International Investment Law (2008), 868 and ss. It is worth highlighting that, when referring toinadmissibility of a claim, we refer to a legal of preclusion to the exercise of a validly conferredjurisdiction.This is themaindifferencewithcomity:whenaclaim isdeclared inadmissible, it is so inlightoftheexistenceofalegalreason(i.e.apreclusion)whichimposestodoso.Onthecontrary,whenjurisdictionisdeclinedforreasonsofcomity,theonlyreasoningatthebasisofthearbitrators’choiceistheir sensibility, i.e. their alleged respect for other tribunals. When we talk about comity there is,therefore,nolegal impedimenttotheexerciseof jurisdiction; instead,suchanimpedimentispresentwhenaclaimisdeclaredinadmissible.

108

Aclaimmaybedeclaredinadmissiblewhenit is inconcretoprecluded,duetolegalimpedimentstohearthatclaimatthattime.Onthecontrary,atribunaldoesnothave jurisdiction if, in abstracto, the tribunal cannot hear the dispute at hand,regardless of timing and preclusions. Therefore, as it has been suggested, “anaccurateapproachisasfollows:iftheobjectionconcernsthepowerorfacultyofthecourtortribunaltodealwiththecaseasawhole[i.e.whentheobjectionregardstheexistenceofconsentorthearbitrabilityofthedispute],theobjectionisjurisdictional;iftheobjectionconcernsthesuitabilityofaparticularclaimtobedealtonitsmeritsatarelevantproceduraltime,theobjectionregardstheadmissibilityofaclaim”.4

It should be noted that, sometimes, in investment cases, the distinctionbetween jurisdiction and admissibility has been denied by arbitral tribunals, inparticularduetothefactthatitdoesnotfindsupportinanyrelevantlegalsource.5Inother cases, Tribunals have avoided tomake such a distinction, stating that it is “adistinctionwithout difference”, i.e., according to this view, the two conceptswouldallegedly coincide.6These criticisms seem to fall short. As confirmed by severalsources,7Tribunals8andAuthors,9indeed,thetwoconceptsare“asdifferentasnightandday”.10

4HuguesArthur,AnuarioMexicanodeDerecho International (2015),458.Asimilar concepthasbeenexpressedbyHeiskanen,ICSIDReviewFILJ(2013),7,wherehesaysthat“whilejurisdictionisaboutthescopeoftheState’sconsenttoarbitrate,admissibilityisaboutwhethertheclaim,aspresented,canorshouldberesolvedbyaninternationaltribunal,whichotherwisehasfoundjurisdiction”.ThedichotomybetweenjurisdictionandadmissibilityisalsoacceptedbyDouglas,TheInternationalLawofInvestmentClaims (2009),135,accordingtowhom“[f]oran investmenttreatytribunaltoproceedtoadjudgethemeritsofclaimsarisingoutofaninvestment,itmusthavejurisdictionoverthepartiesandtheclaims,andtheclaimssubmittedtothetribunalmustbeadmissible”.5Salini Costruttori S.p.A. and Italstrade S.p.A. v. Jordan, ICSID Case No. ARB/02/13, Decision onJurisdiction,9November2004,para.131andss.,MethanexCorporationv.USA,UNCITRAL (NAFTA),Partial Award on Jurisdiction and Admissibility, 7 August 2002, CMS Gas Transmission Company v.Argentina, ICSID Case No. ARB/01/8, Decision on Jurisdiction, 17 July 2003, para. 41, Bayindir v.Pakistan, ICSIDCaseNo.ARB/02/29,DecisiononJurisdiciton,14November2005,paras.85-87,EnronCorporation and Ponderosa Assets L.P. v. Argentine Republic, ICSID Case No. ARB/01/3, Decision onJurisdiction,14January2004,para.33,ConsorzioGroupementL.E.S.I.–Dipentav.RepubliqueAlgerienneDemocratique et Populaire, ICSID Case No. ARB/03/8, Award, 10 January 2005, para. 40. For otherreferencesseeHeiskanen(2013)(n.4),2,footnote2.6RenéeRoseLevyandGremcitelS.A.v.RepublicofPerù, ICSIDCaseNo.ARB/11/17,Award,9January2015; Pac Rym Cayman LLC v. Republic of El Salvador, ICSID Case No. ARB/09/12, Decision on theRespondent’sJurisdictionalObjections,1June2012.7SeeArt.79oftheICJRulesofCourt,Art.44oftheArticlesonStateResponsibilitypromulgatedbytheInternationalLawCommissionandArt.35(3)oftheECHR.8Ioan Micula, Viorel Micula, S.C. European Food S.A., S.C. Starmill s.r.l., and S.C. Multipack s.r.l. v.Romania, ICSIDCaseNo.ARB/05/20,Decisionon JurisdictionandAdmissibility, 24September2008,para.63,AbaclatandOthersv.ArgentineRepublic, ICSIDCaseNo.ARB/07/5,Decisionon JurisdictionandAdmissibility,4August2011,HochtiefAGv.ArgentineRepublic,ICSIDCaseNo.ARB/07/31,Decisionon Jurisdiction,24October2011,AntoineGoetz&OthersandS.A.AffinagedesMétauxv.RepublicofBurundi,ICSIDCaseARB/01/2,Award,21June2012,SGSSociétéGénéraledeSurveillancev.Republicofthe Philippines, ICSID Case No. ARB/02/6, Decision of the Tribunal on Objections to Jurisdiction, 29January2004,PantechnikiSAContractors&Engineersv.RepublicofAlbania,ICSIDCaseNo.ARB/07/21,Award, 30 July 2009, paras. 50-68. See alsoWasteManagement Inc. v. UnitedMexican States, ICSIDCase No. ARB(AF)/00/3, Dissenting Opinion of Keith Highet, 26 September 2001, para. 58. SeveralotherauthoritiesarementionedbyHeiskanen(2015)(n.4),9,footnote32.

109

Thelegalfoundationofthedistinctionbetweenjurisdictionandadmissibilityininvestmentarbitrationmaybetwofold.

In ICSIDarbitrationsuchfoundationhasbeenfoundinArt.41(2)oftheICSIDConvention,statingthat“[a]nyobjectionbyapartytothedisputethatthatdisputeisnot within the jurisdiction of the Centre, or for other reasons is not within thecompetenceoftheTribunal,shallbeconsideredbytheTribunalwhichshalldeterminewhether to deal with it as a preliminary question or to join it to themerits of thedispute”(emphasisadded).AccordingtoHeiskanenthewordcompetenceusedinArt.41hastobeunderstoodasasynonymofadmissibility.Indeed,inHeiskanen’sopinion,admissibility and competence are one and the same concept, only viewed from adifferentviewpoint:onefromtheperspectiveofthetribunal(competence),theotherfromtheperspectiveofaclaim(admissibility).

However, the distinction between jurisdiction and admissibility may be alsoexplained,ingeneralterms,byreferencetotheinherentpowersofarbitraltribunals,11i.e. the powers which are not expressly provided in the international instrumentsregulating the tribunals’ jurisdiction and are used to fill in the lacunae of suchinstruments.12Theexistenceof inherentpowershasfoundbroadacceptancebothinthe case law13 and in scholarship,14 so that it has been said that “the generalapplicationbycourtsandtribunalsofthenotionofinherentpowersmaywarranttheconclusion that a general principle has gradually taken shape in international law,wherebyinternationaljudicialbodiesmayexercisethosepowersthatprovenecessaryforguaranteeingthesoundadministrationofjusticeandprotectingtheirlegalnature”

9See, inter alia, Fitzmaurice,The Law and Procedure of the International Court of Justice, vol. 2, 439(1986), Gouiffés, Ordonez, Arbitration International (2015), 107 and ss., Salles, Forum Shopping inInternationalAdjudication (2014),141andss.,Shany (2015) (n.2),47andss.,Newcombe,Evolution inInvestmentTreatyLawandArbitration(2011),187andss.,Briggs,TheAmericanJournalofInternationalLaw(1985),373andss.,Waibel(2014)(n.1),2andss.,Heiskanen(2013)(n.4),1andss.(theAuthor,at3, footnote11 indicatesseveralotherreferences),Walters,Journalof InternationalArbitration(2012),651 and ss., Potestà, Sobat, Journal of International Dispute Settlement (2012), 137 and ss. Zeiler,InternationalInvestmentLawforthe21stCentury,77andss.,at91seemstorecognizethedistinctioningeneralterms,butexpressesdoubtsonitsapplicabilityininvestmentarbitration.10Paulsson (2005) (n. 3), 603. See also De Brabandere, Journal of International Dispute Settlement(2012),616.11The foundation of the distinction between jurisdiction and admissibility has been found in thetribunals’inherentpowersbyNewcombe(2011)(n.9),194,andbyShany(2015)(n.2),50.12 For a detailed history of the development of this concept see Brown, British Yearbook ofInternationalLaw(2006),205andss.13See,interalia,PCIJ,MavrommatisPalestineConcessions(Greecev.UK),PCIJRepSeriesANo.2(1924)I,16;ICJ,LegalityoftheUseofForce(SerbiaandMontenegrov.Belgium)(PreliminaryObjections)(2005),44ILM299;ICJ,NuclearTests(Australiav.France)(1974)ICJRep253,259-260;ICJ,NuclearTests(NewZealandv.France)(1974)ICJRep457,463;adhocarbitration,RioGrandeIrrigationandLandCompany,6RIAA131,135-6(UK-US,1923).14See,interalia,Palombino,LaComunitàInternazionale(2004),708andss.,Brown(2006)(n.12),195andss.,Mitchell,Heaton,MichiganJournalofInternationalLaw(2010),561andss.,Pierini,UniversityofCatania–OnlineWorkingLegalPaper(2015),1andss.,Weiss,InternationalInvestmentLawforthe21stCentury(2009),185andss.,Orakhelashvili,LeidenJournalofInternationalLaw(2007),36.

110

(emphasis in original).15Indeed, it seems that the necessity to ensure that judicialbodiesproperlyexercisetheir functionfully justifiesthepossibilitythat internationalcourtsandtribunalshavepowersthatarenotexplicitlyconferredtothem,inordertograntthegoodadministrationofjustice.16

This idea has found support also in international investment arbitration.17Inthisregard,itisworthnotingthatthereisexplicitlegalfoundationfortheexistenceofinherent powers in ICSID arbitration (i.e. Article 44 of the ICSID Convention18andArticle 19 of the ICSID Arbitration Rules).19The same can be said with regard toUNCITRALRules20andother institutional rules.21Severalpolicyconsiderations (such

15Gaeta,Man’s Inhumanity toMan (2003), 367.There isno suchbroadcommonalityofopinionswithregard to the sources of such inherent powers. The following opinions have emerged: (i) inherentpowerscanbederivedfromgeneralprinciplesofrulesofinternationallaw.SeeInter-AmericanCourtofHuman Rights,Genie Lacayo (Request for Review of the Judgment of 29 January 1997), Order of 13September1997;(ii) inherentpowersaretobeconsideredasacategoryofimpliedpowers.Suchideahasbeenstronglycriticizedduetothefactthat impliedpowerspertaintointernationalorganizationsand not to international courts (see Gaeta, at 362); (iii) inherent powers are to be considered asfunctional to the exercise of the judicial function and are aimed at guaranteeing the properadministrationofjusticeandtheeffectivenessofthecourts’jurisdiction.Thelastopinionistheonethathasgainedthebiggestsupport.SeePalombino(2004)(n.14),714-715.Thesamedefinitionoftheword“inherent”(i.e.,accordingtotheOxfordEnglishDictionary), i.e.“somethingbelongingtotheintrinsicnatureofthatwhichisspokenof”,seemstosupportthisidea.16 The concept of “la bonne administration de la justice” has been deeply studied by Kolb,L’ObservateurdesNationsUnies(2009),5andss.andSakai,JapaneseYearbookofInternationalLaw(2012), 110 and ss. Kolb has demonstrated that international courts and tribunals have not only aprivate function (i.e. to do justice between the parties), but also a public function (i.e. to grant thatjustice is administrated in the proper way). This public function is the main foundation of inherentpowersandcanbealsofoundininternationalinvestmenttribunals,whichinvolveStatesandthereforeinvolvealso thepublic interest.SeealsoKolb,TheStatuteof the InternationalCourtof Justice (2012),806andss.17See, inter alia, International Company for Railway Systems (ICRS) v. Hashemite Kingdom of Jordan,ICSID Case No. ARB/09/13, Procedural Order No. 2, 9 July 2010, ConocoPhillips Petrozuata B.V.,ConocoPhillipsHamacaB.V.,ConocoPhillipsGulfofPariaB.V.,v.BolivarianRepublicofVenezuela,ICSIDCaseNo.ARB/07/30,DecisiononRespondent’sRequestforReconsideration,10March2014.SeealsoMcDougall,Markbaoui,TheJournalofWorldInvestmentandTrade(2014),1062andss.SeveralotherauthoritiesarementionedinPaparinskisssrn.com(2012),18andss.,Topcan,ICSIDReviewFILJ(2014),633andss.Theexistenceof inherentpowers isalsoconfirmedbythefactthatthe InternationalLawAssociationhasdedicated to the studyof suchpowersabiennial conference.See ILA,Report for theBiennial Conference in Washington D.C. in April 2014 (2014), 1 and ss. Paparinskis, 8 and ss. hasexplained the various legal reasons at the basis of the existence of inherent powers in investmentarbitration.18“AnyarbitrationproceedingshallbeconductedinaccordancewiththeprovisionsofthisSectionand,exceptasthepartiesotherwiseagree,inaccordancewiththeArbitrationRulesineffectonthedateonwhichthepartiesconsentedtoarbitration.IfanyquestionofprocedureariseswhichisnotcoveredbythisSectionortheArbitrationRulesoranyrulesagreedbytheparties,theTribunalshalldecidethequestion”(emphasisadded).19“TheTribunalshallmaketheordersrequiredfortheconductoftheproceeding”.20Art.17(1)statesthat“SubjecttotheseRules,thearbitraltribunalmayconductthearbitrationinsuchmanner as it considers appropriate, provided that theparties are treatedwithequality and that at anappropriate stage of the proceedings each party is given a reasonable opportunity of presenting itscase. The arbitral tribunal, in exercising its discretion, shall conduct the proceedings so as to avoidunnecessary delay and expense and to provide a fair and efficient process for resolving the parties’dispute”(emphasisadded).

111

asthenecessitytoensuretheintegrityofprocess,thepromotionoffairandefficientdisputeresolution,theinterestofjusticeandtheinterestoftheparties)alsomilitateinthissense.Itseemsthereforepossibletosaythatinternationalarbitrationtribunalshavethepowertomanagetheirproceedingsastheydeemappropriate(providedthattheyrespecttherulesandregulationsunderwhichtheyhavebeenconstituted)and,in particular, have the power to distinguish between jurisdiction and admissibilityphases.22

At the admissibility stage arbitrators usually consider preliminary objections,i.e. the questions related (also) to the merit that refer “to prerequisites to theexistenceanddevelopmentofadjudicatoryprocess”.23Suchquestionshaveamaterialcharacter (i.e. theyhave tobe logically assessedbefore themerits, e.g. a timebar)andmaterialeffects (i.e. theycanpotentiallypreventorpostponeadecisionon themerits,e.g.aclaimwhosediscussionviolatesageneralprincipleofinternationallaw).From the decision of preliminary questions related to themerit it could, therefore,derivethatatribunaldecidesthatthediscussionofsomeissues(oroftheentireclaim)

21See,interalia,Art.22(2)oftheICCRules,statingthat“Inordertoensureeffectivecasemanagement,the arbitral tribunal, after consulting the parties, may adopt such procedural measures as it considersappropriate,providedthattheyarenotcontrarytoanyagreementoftheparties”(emphasisadded)andArt. 14(5) of the LCIA Rules, stating that “The Arbitral Tribunal shall have the widest discretion todischargethesegeneralduties,subjecttosuchmandatorylaw(s)orrulesoflawastheArbitralTribunalmaydecidetobeapplicable;andatalltimesthepartiesshalldoeverythingnecessaryingoodfaithforthefair,efficientandexpeditiousconductofthearbitration,includingtheArbitralTribunal’sdischargeofitsgeneralduties”(emphasisadded).22AccordingtoSalles(2014)(n.9),160andss.,therearethreepossibleapproachestothedistinctionbetweenjurisdictionandadmissibility.Thefirstapproachdoesnotdistinguishatallbetweenthetwoconceptsandtreatsbothofthemasacceptabilityoftheclaim(so-called“indifferenceapproach”).Thesecond approach considers jurisdiction as a tribunal-centered approach and admissibility as a claim-centered approach (“objectivist approach”). Finally, the third approach says that all evaluationscentered on consent pertain to jurisdiction, while the remaining reasons to decline a claim regardadmissibility (“conventionalist-residualist approach”). In the opinion of the present author both thesecondandthethirdapproachesareacceptableandmayfindsupportinthecaselawandinscholars’opinions.Itisdifficultheretosayifadmissibilitypertainstothemeritphaseofproceedingsorwhetheritconstitutesaseparateandautonomousstageofinternationalprocess.Intheopinionofthepresentauthor,alsoinlightofthecircumstancethat,asstatedbySalles,at176,“admissibilityquestionsmayarise under general principles of law that regulate resort to international adjudication” and arethereforegovernedbythelawapplicableatthemeritstageofinvestmentarbitrationproceedings(i.e.,aswewillseeinparagraph3.2below,publicinternationallaw),admissibilityseemstobeaquestionofmerit.23Salles(2014)(n.9),110.Onthecontrary,“preliminaryobjectionsareactionsbyaparty,notablytherespondent,thatraisetheseprerequisitesfortheexistenceanddevelopmentofadjudicatoryprocess”.ThesameAuthor,at155,explainsthat“thecategoryofadmissibility–acomplementtothecategoryofjurisdiction – is the usual channel for preliminary objections based on the broader set of normsgoverningtheproceduralrightsandobligationsoftheparties”.

112

isprecluded.24Suchajudiciallimitationofthescopeofthedecisionhasbeendefined“absorption”.25

The above fosters the idea that the distinction between jurisdiction andadmissibility finds support also in the canon of judicial economy.26Indeed, theexistence of a phase of the proceedings in which arbitrators deal with preliminaryissuesofmeritthatcanpotentiallyabsorbthewholediscussiononthemerit,leadingtoadeclarationof inadmissibilityof thewholedispute, seems tobeagoodway tosavetimeandcosts.27

Theadmissibilitystagehasbeenrecognizedasthepolicytoolthatcanbeusedinorder to avoid forumshoppingandparallel proceedings “while the jurisdictionofeach internationaltribunalandthearchitectureofthe international judiciaryare leftuntouched”.28Indeed,inthisphase,byexercisingtheirinherentpowersanddismissingclaimswhose continuation runs against the good administration of justice, arbitratorsmay protect their judicial function and the legitimacy of investment arbitration as awhole.AsnotedbyShany,“since internationalcourtsderivemuchoftheirauthorityfrom notions of the rule of law and from their perceived role as guardians of theinternationalruleoflaw,allowingpartiestoadjudicationtoutilizetheminwaysthatviolate substantive procedural international law could undermine their ownlegitimacy”.29This means that, whenever arbitrators realize, at the admissibility

24The issue of preliminary questions has been deeply studied by Lamberti Zanardi, Rivista di dirittointernazionale (1965), 537 and ss.,Morelli, Rivista di diritto internazionale (1971) 5 and ss., Sperduti,Rivistadidirittointernazionale(1974),649andss.,Morelli,Rivistadidirittointernazionale(1975),5andss.25ThisexpressionisduetoLauterpacht,TheDevelopmentofInternationalLawbytheInternationalCourt(1958),77.AsexplainedbyPalombino,LeidenJournalofInternationalLaw(2010),913,itispossibletodistinguish between absorption stricto sensu and lato sensu. The first “postulates a certain orderbetweentheissuestobedecided–thatisthepresenceofanissuewhich,asamatteroflogic,shouldbeanalysedbeforetheothers;ifthedecisionastotheformerissueisabletosettlethedisputebyitself(absorbing issue), it either precludes or implies a solution to the latter (absorbed issue). The secondtype of absorption, instead, takes place where the judge does not wish to enter into a particularquestion raised in theproceeding and to this enddecides the issuewhich is logically anterior to theothers but in any case enables the dispute to be settled and the resolution of that question to beprecludedorimplied”.Inthepresentbook,wewilldealonlywithabsorptionstrictosensu.26TheconcepthasbeenfullyanalysedbyPalombino(2010)(n.25),910andss.27It is still doubtful whether issues pertaining to the admissibility phase can be raised ex officio byarbitrators or shall be necessarily introduced in the proceedings by the parties. Gouiffés, Ordonez(2015)(n.9),121-122,seemstosupportthesecondidea.However,Article19(1)oftheRomeStatuteoftheInternationalCriminalCourtseemstosupportadifferentopinion.Suchrulestatesthat“TheCourtshallsatisfyitselfthatithasjurisdictioninanycasebroughtbeforeit.TheCourtmay,onitsownmotion,determine the admissibility of a case in accordance with article 17” (emphasis added). Following (byanalogy)thisidea,thatseemsmorecompliantwiththeaimofthepresentbookandwhichissupportedbythefindingthatadmissibility isapolicytoolaimedatsafeguardingthe legitimacyof internationalinvestmentarbitrationtribunals(inparticularagainstforumshoppingtechniques),wecouldstatethatarbitrators could raise concerns related to abuse of process, res judicata and collateral estoppel bythemselves.Thisapproachisthepreferableoneaccordingtotheopinionofthepresentauthor. 28Salles(2014)(n.9),158.TheAuthorfurthersaysthat“focusingonadmissibilityputsalltribunalsonan equal footing, but it also underscores the need for a case by case assessment of the conditionsunderlyingadjudication”.Thisispreciselytheaimofthepresentbook.Similarly,seeDouglas(2009)(n.4),141.29Shany(2015)(n.2),154.

113

stage, that the continuation of (duplicative) proceedings runs against the properadministration of justice and risks to undermine the judicial function that theyadministrate, both because such continuation runs against the canon of judicialeconomyandbecauseitrunsagainstgeneralprinciplesofinternationallaw,theyhavetoexercisetheirinherentpowersinordertoprecludetheseproceedingstogoon.

The next paragraphs will be aimed at individuating the legal tools to whicharbitrators may refer at the admissibility stage in order to prevent parallelproceedingsandprecludetheircontinuation.Itisheresubmittedthatsuchtoolsmaybeindividuatedincertainprinciplesofinternationallaw,suchasgoodfaithandnebisin idem. However, prior tomove to examine the various principles thatmight limitparallel proceedings, it is necessary to explain why and how general principles ofinternationallawareapplicableininvestmentarbitration.

3.2 Theapplicability of general principles of international law in investment

arbitrationThe applicability of general principles of international law in investment

arbitration, thattoday isquiteunanimouslyaccepted,hasbeentheobjectofseveredebates. Hence, in this paragraph, we will briefly examine the issue of the lawapplicableininternationalinvestmentarbitration.30

Inthedeterminationofapplicablelaw,thefirsttaskofatribunalistoascertainwhether the parties have expressed any choice in this regard; 31 indeed, partyautonomy isalwaysthefirstsourceof regulation inarbitration.This isconfirmedbyseveralarbitrationrules,suchasart.42(1)oftheICSIDConvention,which,atitsfirstsentence,saysthat“[t]heTribunalshalldecideadisputeinaccordancewithsuchrulesof lawasmaybeagreedby theparties”.Similarly,Art. 35ofUNCITRALArbitrationRules states: “[t]he arbitral tribunal shall apply the rules of law designated by thepartiesasapplicabletothesubstanceofthedispute”.32

Inmoderninvestmentdisputes,sometimes(butnotveryoften)33thechoiceoftheapplicablelawismadebytheparties.SuchchoiceisusuallymadebyreferencetotheapplicableBITor in the investmentcontractexistingbetweentheStateandtheinvestor.

30The subject has been extensively dealt with by Begic, Applicable Law in International InvestmentDisputes(2005),1andss.,andKjos,ApplicableLawinInvestorStateArbitration(2013),1andss.SeealsoBelohlavek,Cerny,InternationalJournalofLawandManagement(2012),443andss.31Kahn,IndianaLawJournal(1968),6andss.,Feuerle,YaleStudiesonWorldPublicOrder(1977),103and ss., Shihata, Parra, ICCA Congress Series No. 7 (1996), 294 and ss., Gaillard, Banifatemi, ICSIDReviewFILJ(2003),375andss.,Schreuer,www.univie.ac.at(2007),9andss.,Tawil,UNCTADCourseonDispute Settlement in International Trade, Investment and Intellectual Property, 11 and ss., CrespiReghizzi,Rivistadidiritto internazionaleprivatoeprocessuale (2009),28andss.,Giardina,Rivistadidiritto internazionale privato e processuale (1982), 679 and ss., Beniassadi, International Tax andBusinessLawyer(1992),61andss.32Inthesamevein,Art.21oftheICCRulesofArbitrationsaysthat“Thepartiesshallbefreetoagreeupontherulesoflawtobeappliedbythearbitraltribunaltothemeritsofthedispute”.33Gaillard,Banifatemi(2003)(n.31),379.

114

WhenBITsmakereferencetotheapplicable law,theyusuallymainlyrefertothe same BIT, public international law and, sometimes, also to the law of the hostState.34VeryfewBITdonotrefertointernationallaw,35whilethepresentauthorhasnotbeenabletofindaBITreferringonlytothelawofthehostState.

Thesituationcanbedifferentininvestmentcontracts:inthesesourcesusuallythe referencegoesmainly to the lawof thehostState, even if it is not rare to findinvestmentagreementsreferringalsotointernationallaw.36

Withregardtothecasesinwhichthepartieshavemadeachoiceofapplicablelawdifferentfrominternational law,the issue iswhetherarbitratorshavethepowertointegratesuchparties’choiceandapplyalsoprinciplesand/orrulesofinternationallawthattheyconsideressentialforthecaseathand.Inthisregard,itshouldbenoted,first of all, that “international law is frequently incorporated into domestic lawthrough a variety of techniques. To the extent that it thereby becomes applicableinternally, itmaybeseenaspartofasystemofdomestic lawchosenbythepartiesandmayberelieduponbeforeanICSIDtribunal”.37However,evenifoneshouldfindthat international law isnot (directlyor indirectly)applicable, it isworthnotingthatthemoderntrendistoconsiderthatinvestmentarbitratorshavethefreedomtoapplytheprinciplesofinternationallawthattheyconsideressentialforthegoodresolutionofthecase.38ThisideaisclearlyputforwardbyTawil,whostatedthat“therearegood

34AnexampleofBITreferringtoallthesesystemsoflawisArt.10ofthe1992Argentina/NetherlandsBIT, stating that “TheArbitrationTribunaladdressed inaccordancewithparagraph (5)of thisArticleshalldecideonthebasisofthelawoftheContractingPartywhichisapartytothedispute(includingitsrulesontheconflictoflaw),theprovisionsofthepresentAgreement,specialAgreementsconcludedinrelationtotheinvestmentconcernedaswellassuchrulesofinternationallawasmaybeapplicable”.35See the exhaustive list made by Gaillard, Banifatemi (2003) (n. 31), 377-378. See also Gaillard,Annulment of ICSID Awards, IAI Series on International Arbitration N°1 (2004), 226-227. This AuthormentionstheAustralia-EgyptBITanstheBelgium&Luxembourg-MongoliaBIT,whichdonotmentioninternationallawbutonlyrefertothesameBITs,tothelawofthehostStatesandtootheragreementsbetweentheparties.36SeeCrespiReghizzi(2009)(n.31),28.SomeICSIDcasesreportchoicesbythepartiesofnationallawand international law.SeeAGIPv.RépubliqueDémocratiqueduCongo,Award,30November1979,67Int.LawRep.318(1984)andKaiserBauxiteCompanyv.Jamaica,Award,6July1975,114Int.LawRep144(1999).37Tawil(2003)(n.31),9.38SeeBeniassadi,InternationalTaxandBusinessLawyer(1992)62andss.,Bjorklund,MandatoryRulesinInternationalArbitration(2011),270,Donovan,MandatoryRulesinInternationalArbitration(2011),282andss.Thereferencegoestotheessentialprinciplesofinternationalcommerce,whichareconsideredbypart of the scholars as constituting the transnational or “truly international” public policy. Such aconceptshallnotbeconfusedwiththeconceptofjuscogens(onwhichseeOrakhelashvili,PeremptoryNorms in International Law (2008), 7 and ss.). For a broader understanding of the concept oftransnationalpublicpolicyseeLalive, ICCACongressSeriesNo.3(1986),257andss.,Dolinger,TexasInternational Law Journal (1982), 167 and ss. See alsoMann, British Yearbook of International Law(1957),20andss.,Gal,CornellInternationalLawJournal(1972),55andss.Theconceptoftransnationalpublic policy has been recently applied by two investment arbitration awards, i.e.World Duty FreeCompany Ltd. v. Republic of Kenya, ICSID Case No. ARB/00/7, Award, 4 October 2006, InceysaVallisoletanaS.L.v.RepublicofElSalvador,ICSIDCaseNo.ARB/03/26,Award,2August2006.Theideathat“investmentlawmustbeinterpretedconsistentlywithinternationallaw”isputforwardalsobyvanAaken, Finnish Yearbook of International Law (2006), 91 and ss. The applicability of these rules issupportedalsobytheprinciple iuranovitcuria,accordingtowhichthejudgeisnotboundbythelegalallegationsof theparties; suchprinciplehasbeen consideredageneral principleof international law

115

reasonsforthepropositionthatthereisatleastsomeplaceforinternationallaweveninthepresenceofanagreementonchoiceoflawwhichdoesnotmentionit”.39Intheopinionof thisauthorarbitratorshave“a reluctancetoabandon international law infavourofthehostState'sdomestic law.Thecompleteexclusionof international lawasaconsequenceofanagreedchoiceoflawcontainingonlyadomesticlegalsystemwouldleadtoundesirableconsequences.ItwouldmeanthatanICSIDtribunalwouldhavetoupholddiscriminatoryandarbitraryactionsbythehostState,breachesofitsundertakingswhichareevidentlyinbadfaithoramounttoadenialofjusticeaslongastheyconformtotheapplicabledomesticlaw.Itwouldmeanthataforeigninvestor,by assenting to a choice of law, could sign away the minimum standards for theprotectionofaliensandtheirpropertydevelopedincustomaryinternationallaw.Sucha solutionwouldbecontrary to thegoalof theConvention to stimulate investmentthroughthecreationofafavourableinvestmentclimate”.40 SuchanapproachseemsconfirmedbyArticle4ofthe2013ResolutionoftheInstitutdeDroitInternationalonLegalAspectsofRecoursetoArbitrationbyanInvestorAgainst the Authorities of the Host State under Inter-State Treaties, stating that“Arbitraltribunals,whenreferringtonotionsdefinedinmunicipallaw(…)shallatthesametimerespecttherelevantrulesofinternationallaw”. Havingascertainedthat international law isapplicableevenwhenthepartieshavemade an autonomous choice of law,wehave now to turn on the issue of theapplicabilityofinternationallawwhenthepartieshavenotmadeanexpresschoiceofapplicable law.Suchacircumstance isnotunusual in investmentcases.41InordertoassesstheissueadistinctionbetweencasesbroughtundertheauspicesofICSIDandotherinvestmentcasesisrequired. WithregardtoICSIDcases,theissueofapplicablelawinabsenceofachoiceisregulatedbyArt.42(1),secondsentence,oftheWashingtonConvention,statingthat

sinceSereni,Principigeneralididirittoeprocesso internazionale (1955),79; inthisregardseealsoKolb(2012)(n.16),820andss.Withregardtotheapplicabilityoftheprincipleinarbitration,seeCarlevaris,Rivista dell’arbitrato (2007), 505 and ss., Spagnolo, Towards Uniformity: the 2nd Annual MAASchlechtriemCISGConference (2011), 181 and ss., Kaufmann-Kohler,Arbitration International (2005),631 and ss., Kurkela, ASA Bulletin (2003), 486 and ss., Lew, ssrn.com (2010), 1 and ss. For a broadanalysisoftheconceptofmandatoryrulesinarbitrationseeMistelis,MandatoryRulesinInternationalArbitration(2011),292,Zhilsov,NetherlandsInternationalLawReview(1995),81andss.39Tawil,(2003)(n.31),9.40Tawil (2003)(n.31),10Inaccordancewiththis idea,seetheilluminatingoperabyFeuerle,(1977)(n.31),105andss., stating,at107, thatarbitratorshave“generally interpretedtheparties’choiceof lawclauses liberally so as to enable the tribunal to invoke rules not expressly designates, such asinternational law,general lawprinciples,or the lawof thirdstates,evenwhere thepartieshadmadedeterminationswhichseemedtobecomprehensive”.This ideaseemscompliantwithwhatstatedbyMcNair,BritishYearbookofInternationalLaw(1957),whosaidthatcontractsconcludedbyStatesandforeigninvestors,evenifnotgovernedbypublicinternationallaw,“canmoreeffectivelyberegulatedbygeneralprinciplesoflawthanthespecialrulesofanysingleterritorialsystem”.Sacerdoti,Icontrattitrastatiestranierineldiritto internazionale (1972),262,hasfurtherstated, inthisregard,thatgeneralprinciplesofinternationallawcanbeconsideredipsofactoapplicabletothesecontracts.ThisideadoesnotseemcompletelyfollowedbyCrespiReghizzi(2009)(n.31),28andss.,andbyGiardina(1982)(n.31),679andss.41Gaillard,Banifatemi(2003)(n.31),379.

116

“[i]n theabsenceof suchagreement [i.e. theagreementon theapplicable law], theTribunalshallapplythelawoftheContractingStatepartytothedispute(includingitsrulesontheconflictoflaws)andsuchrulesofinternationallawasmaybeapplicable”(emphasisadded).42Art.42isnotclearinexpressingtherelationshipbetweenthelawofthehostStateandinternationallaw.Varioustheorieshavebeenputforwardinthisregard. A first (and old) theory stated that, in absence of a choice by the parties,disputesshouldhavebeenmainlyregulatedbythenationallawofthehostState.Thereason for this was that the reference to international law “seems to be precludedfrom the subsidiary references [to such law] established by the Convention in theabsenceofachoiceoflawbytheparties”.43Thistheoryseemscompletelyoutdated.Indeed,as ithasbeenexplained, itwasbasedonthe(todayunfounded)assumptionthat international law regulating foreign investmentwasveryundevelopedandwasunable to regulate the very complex relationships between States and foreigninvestors.44 Asecondtheory,closetothefirstone,hasbeendevelopedbyProf.Reisman.Hestates that investmentdisputesshouldbegovernedbynational law,unlesssuchlawisagainst international juscogens.45ThejustificationforReisman’stheoryisthatthenational lawofthehostStatemusthaveaneffectiverole.Anyway,asstatedbyGaillardandBanifatemi,46this ideaseemstogoagainstthereadingofart.42oftheICSID Convention, which does not make any reference to jus cogens and, on thecontrary,seemstoputnationallawandinternationallawonthesamelevel.47 A third theory,developedon thebasisof thedecisionsof theKlockner48andAmco49adhoccommittees,andsupportedbyseveralscholars,50putforwardtheideathatinternationallawshallhaveonlyasupplementalandcorrectivefunctionvis-à-visdomestic law. International law should only intervene in case of lacunae in theapplicablenational lawsystemor incasesuchsystemrunsagainst international lawobligations.

42According to par. 41 of the Report of the Executive Directors of the International Bank forReconstruction andDevelopment on the Convention on the Settlement ofDisputes between StatesandNationalofotherStates,availableaticsid.worldbank.org,suchreferencetointernationallawshallbeintendedasareferencetothesourcesindicatedinArticle38(1)oftheICJStatute.43Kahn(1968)(n.31),31.44Kahn(1968)(n.31),31,saidthat“whiletheinternationallawinthisareaisstillveryuncertainandoflimitedscope,itsimportancewillgrowwiththecorrespondingdevelopmentofthelawofinvestment”.45Reisman,ICSIDReviewFILJ(2000),380.46(2003)(n.31),400andss.47TheideathatnationalandinternationallawwereonthesamelevelwithintheframeworkofArt.42wasalreadyputforwardin1982byGiardina(1982)(n.31),693.48Klocknerv.Cameroon,ICSIDCaseNo.ARB/81/2,AdHocCommitteeDecision,3May1985.49AmcoAsiaCorporationandothersv.RepublicofIndonesia,ICSIDCaseNo.ARB/81/1,DecisionontheApplicationforAnnulment,16May1986.TheapproachwasfollowedalsoinCDSEv.CostaRica,ICSIDCaseNo.ARB/96/1,Award,17February2000.50SeeCrespiReghizzi(2009)(n.31),32andss.,Giardina,TheLawandPracticeofInternationalCourtsandTribunals(2006),29andss.,Schreuer(2007),12.

117

ThelastmentionedapproachhasbeencriticizedbyGaillardandBanifatemi,51who–onthebasisofthedecisionoftheadhocCommitteeinWena52–haveexplainedthat international law is directly applicable in investment disputes in light of theinterpretation of Art. 42 imposed by Art. 31 and followings of the 1969 ViennaConvention on the Law of Treaties. According Gaillard and Banifatemi, the word“and” contained in the second sentence of Art. 42 means only “and”. As aconsequence, arbitrators, in case of lack of a choice by the parties, shall apply thenational lawof thehostStateand theapplicable rulesof international law.Thetwosystems are on an equal footing. “[I]nternational law constitutes a legal order fullyoperating[ininvestmentarbitration]inbothitspublicpolicyfunctionandasabodyofsubstantiverules”.53 This theory, which has found support in the work ofmany other scholars,54seemsthemostcorrectandappropriateforaformofarbitrationwhichhasastrongpublic international law component 55 and that, usually, finds its foundation ininternationallawtreaties. Having ascertained that international law is applicable in ICSID cases wherethepartiesdidnotmakeanychoiceoflaw,wehavenowtoturntonon-ICSIDcases.Areferencetosomeinstitutionalrulescanherebeofcertainsupportfortheresearch.The second sentence of Art. 35 of the UNCITRAL Rules says that “[f]ailing suchdesignation[ofapplicablelaw]bytheparties,thearbitraltribunalshallapplythelawwhichitdeterminestobeappropriate”.Similarly,thesecondsentenceofArt.21(1)ofthe ICC Rules stipulates that “[i]n the absence of any such agreement [on theapplicablelaw],thearbitraltribunalshallapplytherulesoflawwhichitdeterminestobeappropriate”. It thereforeseemsthatarbitratorsarecalledtoassumeaproactiverole inthedeterminationofapplicable law.56Inthisregard, it isobviousthat–giventhe duty of arbitrators to issue an enforceable award – they will keep intoconsideration and apply all the rules related to the field of law in which the legalrelationship at hand finds its foundation (i.e., in investment cases, mainlyinternationallaw).57Giventheabove,itseemsquitecertainthatarbitratorswillapplyinternationallawalsoinnon-ICSIDinvestmentcaseswherethepartieshavefailedtomakeachoiceoflaw.58

51(2003)(n.31),403andss.52WenaHotelsLimitedv.ArabRepublicofEgypt,ICSIDCaseNo.ARB/98/4,DecisiononApplicationforAnnulment,5Feb2002,paras.38-40.53Gaillard(2004)(n.35),234.54See,interalia,Fenyvesi,AdamAntalPhDtanulmanyok(2005),57andss.Theideathat“nationalandinternationallawshouldnotbeunderstoodasmutuallyexclusivesetsofrules”wasalreadysetforthbyFeuerlein1977.SeeFeuerle(1977)(n.31),115.55SeeDouglas,BrithishYearbookofInternationalLaw(2003),151andss.56In non-ICSID cases, the determination of applicable law seems to be closer to the one made byarbitratorsininternationalcommercialarbitration.SeeLew,ApplicableLawinInternationalCommercialArbitration(1978),1andss.57Ibid.58This isalsoconfirmedby thevast reference that investment tribunalsuse tomake to ICJcase law.See Pellet, ICSID Review FILJ (2013), 223 and ss. In this regard, see also Douglas (2009) (n. 4), 40,

118

As a conclusion, we can affirm that international law is always applicable ininternational investmentdisputes.59Thismeansthattheassessmentthatarbitratorswill have tomake in order to decidewhether a certain claim is admissible shall bebased, interalia,onpublic international lawand, inparticular,forwhat isrelevant inthe present book, on general principles of international law, i.e. general principlesdevelopedandapplied in international law.Suchprinciplesare legalsources,usuallywith a very broadmeaning,which – by themselves or bymeans of amore specificprincipleorrulegatheredbythem–expressthekeygoalsandvaluesofinternationallaw. For this reason, they have always to be respected. 60 Indeed, it is today“undisputedthatgeneralprincipleshaveacquiredaroleintheshapingofrulesinthearea of foreign investment protection and play a prominent role in arbitrationsbetween States and foreign nationals”.61As a consequence, if the continuation of

according to whom “[a]n investment treaty tribunal has the inherent authority to characterise theissuesindisputeanddeterminethelawsapplicablethereto”.59SuchaconclusionissharedbyBjorklund(2011)(n.38),268.SeealsoDonovan,(2011)(n.38),276.60Palombino,Iltrattamentogiustoedequodegliinvestimentistranieri(2012),47and55andss.Generalprinciplesofinternationallawareusuallyfoundoutbyinternationaljudgesonthebasisofaninductive-deductive process. Firstly judges draw a principle from already existing norms (inductive step) and,secondly,theyexpressaspecificrulefortheconcretecasefromthegeneralprinciplestheyhavedrawnbefore(deductivestep).61Gazzini,JournalofWorldInvestmentandTrade(2009),103.Inthisregard,itisworthnotingthat–inthepresentbook–thereferenceto“generalprinciplesofinternationallaw”shallnotbeunderstoodasareferencetothegeneralprinciplesthatarecommontonationallawsystemsandthatarementionedin Art. 38(1)(c) of the ICJ Statute. The distinction (if any) between general principles and generalprinciples of international law (both sources of general international law) has been one of themostdebatedquestions in international lawandisstillanopenissue.See, inthisregard,Gaja,MaxPlanckEncyclopediaofPublic InternationaLaw, (2008),par.8and21andss. Inparticular,Gaja,atpar.8,hasclarified that “theapplicationof [a]principle in international lawdoesnotnecessarilydependon thefact that theprinciple iscommontoanumberofmunicipalsystems”.Thismeans,accordingtoProf.Gaja,thattherecouldexistgeneralprinciplesof international lawthatarenotborn inthepracticeofmunicipal law but are a sub-specie of customary international law. The same idea is expressed byGazzini(2009),104,wherehesays“generalprinciplesoflawcoexistbothinthedomesticlegalsystemsof the generality of the Statesand in international law” (emphasis in original). Strozzi, La comunitàinternazionale (1992), 164 has finally stated that “international judges apply always internationalprinciples,evenifstrengthenedbyacorrespondencewithanalogousprinciplesofmunicipallaw.Hence,general principles common to municipal systems correspond to already existing principles ofinternational law (…) otherwise they cannot be considered as part of positive international law”(emphasis inoriginal).The issueof thenatureofgeneralprinciplesof international lawhasbeen theobjectofseveralstudies.OnthismatterseealsoCarpanelli,GeneralPrinciplesofLaw–TheRoleoftheJudiciary(2015),125andss.AveryexhaustiveworkhasbeenwrittenbyMagnani,Nuoveprospettivesuiprincipigeneralinelsistemadellefontineldirittointernazionale(1997),71andss.,whileSereni(1955)(n.38), 1 and ss., has deeply studied the general principles regarding international processes. See alsoGaillard,WorldArbitration&MediationReview(2011),161andss.,Nolan,Sourgens,WorldArbitration&MediationReview(2009),505andss.,Lammers,EssaysontheDevelopmentoftheInternationalLegalOrderinmemoryofHaroF.vanPanhuys(1980),53andss.,Ellis,EuropeanJournalofInternationalLaw(2011), 949 and ss., Di Benedetto, International Investment Law and the Environment (2013), 73,BalladorePallieri,I“principigeneralideldirittoriconosciutidalenazionicivilinell’art.38dellostatutodellaCortepermanentediGiustiziainternazionale(1931),1andss.,FreemanJalet,UCLALawReview(1963),1041andss.However,alsoin lightofthefactthatboththesesourcesaretobeconsideredaspartofgeneral international law(andthereforearebothapplicable in investmentarbitration), inthepresentbookamorepragmaticapproachwillbefollowedandthereferencewillonlygo, ingeneralterms,to

119

duplicative proceedings runs against general principles of international law,arbitrators should exercise their inherent powers aimed at safeguarding the properexerciseoftheirjudicialfunctionandprecludesuchduplicativeproceedingstogoon.

We will now turn on the examination of general principles of publicinternational law thatmay be helpful in avoiding parallel proceedings and ensure agoodadministrationofjusticebyinvestmenttribunals.

3.3 Aninadequatesolutionfortheproblemofparallelproceedings:the“firstintime”rule

Thefirstintimerule,orlispendens,isoneofthemaindoctrineswhichcivillawcountries (and theEU) use in order to avoid parallel proceedings.According to thisdoctrine“whentwocourtshavebeenseizedofthesamedispute[andnoneofthemhas still decided suchadispute], the court seized second shoulddecline jurisdictionandletthecourtseizedfirstdecidethedispute”.62Theapplicationoflispendensreliesonlyonthetimefactor.The judgeseized firstshallgoonwiththeproceedings, thesecond shall stay.Theonly conditions toapply lis pendens, are that theparties, theobject of their claims (petitum) and the legal basis of such claims (causa petendi)coincideinthetwoproceedings(so-calledtripleidentitytest).63 AccordingtoReinisch“itcanhardlybedisputedthatlispendensis(…)aruleofinternational law applicable in international proceedings. The widespread use andsimilarityoftheconceptoflispendensinthenationalprocedurallawsofStatesofalllegaltraditionsaswellasitsinclusioninanumberofbi-andmultilateralagreementsisevidencethatlispendenscanberegardedasageneralprincipleoflawinthesenseofArticle 38of the ICJStatute. Further, theexistenceor applicationof sucha rulewasgenerallyacknowledgedinthefewcaseswherelispendensclaimsweremadebeforeinternational courts or tribunals” (emphasis added).64This would mean that if twointernationalarbitral tribunalsare seizedof thesamedispute (i.e. the triple identitytestismet),thetribunalseizedsecondshoulddeclinetoexerciseitsjurisdiction. However,thisstatementisnotconvincingfortwomainreasons.Firstofall,nointernational tribunal has ever applied lis pendens; secondly, several national legalsystems(i.e.allthesystemspertainingtothecommonlaw)donotapplylispendensatall. It is thereforequestionablethat lispendens isageneralprincipleof international

general principles of international law. This approach also corresponds to the general pragmaticattitudeofinvestmenttribunals.62Cuniberti,ICSIDReviewFILJ(2006),382.63The triple identity test is usually applied very strictly in national court proceedings. However, theCourt of Justice of the European Union has developed a less strict approach to such test, and inparticulartotherequirementsofpetitumandcausapetendi,inordertoavoidthatthesamejudgementisstartedintwoEUmemberStates, inoneasaclaimfordamagesandinthesecondasarequestfornegativedeclarationoflackofliability.SeeMcLachlan,LispendensinInternationalLitigation(2009),117andss.As itwillbeshowninparagraphs3.6and3.7thepresentauthorstronglybelievesthatastrictapplicationofthetripleidentitytestwouldleadtomanifestinjusticeandwouldfosterabuses.64Reinisch, The Law and Practice of International Courts and Tribunals (2004), 50. This opinion issharedbyHober,ResJudicataandLisPendensinInternationalArbitration(2013),330.

120

lawand,moreover,itisarguablethatlispendens isnotevenaprincipleoflaw,butamererule.Theselinesofreasoningwillbedevelopedinthepresentparagraph. Withregardtothedevelopmentoflispendens ininternationallaw,itisworthnotingthattherelevantcase law is“tooscarceandnon-determinative”65toconfirmtheexistenceofsuchaprinciple.Inallthecaseswherelispendenshasbeeninvoked,international tribunalshaveavoidedtoapply it. InCertainGerman Interests inPolishUpperSilesia,66thePCIJrefusedtoconsiderwhetherlispendensisageneralprincipleofinternationallawduetothecircumstancethatthetripleidentitytestwasnotmet.In Factory at Chorzow67the same PCIJ “made reference albeit indirectly, to theprincipleofestoppel,ratherthanthelispendensdoctrine”.68Similarly,inhisseparateopinionintheMOXPlantcase,JudgeTrevesstatedthatthelegalstatusoflispendensis a “completelyopen” issue.69Finally, andmost importantly, in theSPP case70, thetribunaldidnotfinditselfboundbylispendensandstatedthat“whenthejurisdictionsof twounrelatedand independent tribunalsextend to thesamedispute, there isnorule of international law which prevents either tribunal from exercising jurisdiction”(emphasis added). All these decisions, albeit mentioning lis pendens, show a clearreluctancetoapply the first in timerule toparallelproceedings in international law.Severalinvestmentarbitraltribunalshavealsodealtwiththeissueandnoneofthemhasappliedtherule.71 Movingtotheacceptanceoflispendensinnationallawsystems,whileitistruethatlispendenshasfoundbroadacceptanceinalmostallcivillawsystems(includingEU law,72due to the circumstance that EU countries are for the majority civil lawsystems),itisworthnotingthatthisrulehasneverfoundapplicationincommonlawsystems.73Thisisduetothefactthat,historically,commonlawsystems–whichwere

65Shany,TheCompetingJurisdictionsofInternationalCourtsandTribunals(2003),244.Notwithstandingtheabove,Shanyhasalsostatedthat lispendenscouldbequalifiedasageneralprincipleifonetakesintoaccountthesinglesystemsof justice.Thepresentauthordoesnotsharethisopinion;ananswercanbegivenusingthewordsofGaja, (2008) (n.61),par.7:“generalprinciplesthatexist inmunicipalsystemsoflawdonotnecessarilyformpartofinternationallaw.Themainreasonliesinthedifferenceinstructurebetweeninternationalsocietyandmunicipalsocieties”.Moreover,aswillbeshownbelow,lispendensisnotacceptedinarelevantnumberofmunicipalsystems.66Germanyv.Poland,Judgment(1925)PCIJ(ser.A)No.6,20.67Germanyv.Poland,Jurisdiction(1927)PCIJ(ser.A)No.9.68Nguyen,BondLawReview(2013),157.69InternationalTribunal for theLawof theSea, Irelandv.UnitedKingdom,CaseNo.10,Request forProvisionalMeasures,3December2001.70SouthernPacificProperties(MiddleEast)Limitedv.ArabRepublicofEgypt, ICSIDCaseNo.ARB/84/3,Award,20May1990.71SeeS.A.R.L.Benvenuti&Bonfantv.People’sRepublicoftheCongo,ICSIDCaseNo.ARB/77/2,Award,8August1980,CompaniadeAguasdelAconquijaS.A.andVivendiUniversalv.ArgentineRepublic, ICSIDCaseNo.ARB/97/3,Award,21November2000,AlexGeninandothersv.RepublicofEstonia,ICSIDCaseNo. ARB/99/2, Award, 25 June 2001, Azurix Corp. v. Argentine Republic, ICSID Case No. ARB/01/12,Decision on Jurisdiction, 8 December 2003. For other references see Cuniberti (2006) (n. 62), 381,footnote1.72See1968BrusselsConventionandEURegulations44/2001and1215/2012.73TheissueisdeeplyanalysedinShany,ssrn.com(2006),45andss.,Cuniberti(2006)(n.62),402andss.,McLachlan(2009)(n.63),48andss.and143andss.,Nguyen(2013)(n.68),158-159,Yannaca-Small,TheOxfordHandbookofInternationalInvestmentLaw(2008),1021andss.,Das,www.academia.edu,1

121

basedonthecoexistenceofcommonlawandequitycourts–havenotseenparallelproceedings as a necessary evil.74What common lawyers are looking for is theresolutionofacaseinthemostappropriateforumandnotintheforumfirstseized.Ifthe judge second seizedbelieves that he is themost appropriate judge to hear thecase,hewillgoonwith theproceedings.75In thewordsofLordGoff“there is, so tospeak, a jungle of separate, broadly based, jurisdictions all over the world (…) Thebasicprincipleisthateachjurisdictionisindependent.Thereistherefore,asIhavesaid,noembargoonconcurrentproceedingsinthesamematterinmorethanonejurisdiction”(emphasisadded).76Similarly,intheUS,WilkeyJstatedthat“parallelproceedingsonthesameinpersonamclaimshouldordinarilybeallowedtoproceedsimultaneously,atleastuntil a judgment is reached inonewhichbepleadas res judicata in theother”(emphasisadded).77 Fortheabovereasons,commonlawyershavestartedtomakerecoursetotheScottish doctrine of forum non conveniens and to anti-suit injunctions, twodiscretionarytoolsthatwehavealreadyexaminedinChapter2above.Itisonlyworthrepeatingherethatforumnonconveniensandanti-suit injunctionsarenotrelatedtoconsiderationsoftime,butonlyonadiscretionaryevaluationoftheappropriatenessofthecourttohearacertaincase. Inlightoftheabove,itisevidentthatitisnotpossibletorelyonlispendensasa general principle of international law.Not all States rely on this doctrine and theinternationalcaselaw,asshownabove,goesagainstthisidea.78 Infactitisevenarguablethatlispendensisnotaprincipleoflaw.Indeed,ifweconsider Dworkin’s distinction between principles and rules,79we find out that aprincipleexpressesatendencyofasystemof lawtowardscertainvaluesandcertainobjectives to be reached (we could describe it as a “transformator of extra positive

andss.,Soderlund,JournalofInternationalArbitration(2005),301andss.,Bregensjo,LisAlibiPendensin InternationalArbitration (2013),39andss.,OrregoVicuna,ParallelStatesandArbitralProcedures inInternationalArbitration (2005),207andss.Thematterhasbeenalso thesubjectof the InternationalLaw Association Toronto Conference, from which originated the Final Report on Lis Pendens andArbitration, further analysed by Ma, Contemporary Asia Arbitration Journal (2009), 56 and ss. TheconceptoflispendensininternationallitigationwithanEUperspectivehasbeenanalysedbyConsolo,Rivistadidirittointernazionale(1997),5andss.,Salerno,Rivistadidirittointernazionale(1999),363andss.74ForanhistoricalanalysisoflispendensseeMcLachlan(2009)(n.63),48andss.75Baumgartner, Zeitschrift für Zivilprozeß International (1998), 218, stated that “civil lawyers shouldnotforgetthat,inthecommonlawworld,thesearchforthejustandfairresolutionofeverysinglecasehas a long tradition in equity procedure, which developed in response to the rigid procedure in thecommonlawcourts,andwhich,oftenmannedbyclergy,operatedonreasonandmoralityratherthanonlegaltechnicalities”.76HouseofLords,AirbusIndustrieGIEv.Patel,[1999]1AC119(HL),132-133.77LakerAirwaysLtdv.SabenaBelgianWorldAirlines,731F.2d909(DCCir.1984).78SeeWehland,TheCoordinationofMultipleProceedings in InvestmentTreatyArbitration (2013), 194-196,Yannaca-Small(2008)(n.73),1015,Shany,RegulatingJurisdictionalRelationsbetweenNationalandInternationalCourts(2007),158,Yang,TsinghuaChinaLawReview(2011),352.79Dworkin, Taking Rights Seriously (1978), 14-15. The subject has been deeply analized by Viola,Zaccaria,Dirittoeinterpretazione(2009),366andss.SeealsoIovane,ArsInterpretandi(2008),124andStrozzi(1992)(n.61),168.

122

(moral,socialorother)needsintothelegalsystem),80whilearuleissomethingmoreconcrete, i.e. a precise order to do something, not to do something, or to dosomethinginacertainway.Itistheopinionofthepresentauthorthatlispendensisaprecise rule applied in certain systems of law, which imposes to judges to declinejurisdictionwheneveranotherjudgehaspreviouslybeenseizedofthesamedispute.Lis pendens is an answer to the needs of efficiency and to the canon of judicialeconomythathasbeengivenincertain legalsystems.81Referringto lispendensasageneral principle of international law is therefore erroneous. As a consequence,considering that – as stated by Bin Cheng – Article 38(1)(c) of the ICJ regards“principles, not rules”,82lis pendens cannot anyway be regarded as encompassed inArt.38(1)(c).

In conclusion, lis pendens cannotbeadoptedasa solution to theproblemofparallelproceedingsininvestmentarbitration.

3.4 Sourcesofgeneralinternationallawprovidingforsolutionstotheproblemofparallelproceedings:theprinciplesofgoodfaithandnebisinidemandtheirconcreteapplications

Good faith and ne bis in idem are broadly referred as general principles ofinternational law.83Indeed, with regard to proceedings before international courtsandtribunals,suchprinciples– intheirproceduraldimension–canbeconsideredasthe source of other general principles and/or rules that are essential to the correctregulation of such proceedings. Indeed, as general principles, they have beenconsidered to play “a middle role between the lex lata and the lex ferenda, beingwholly neither one, nor the other. They have that just degree of abstraction andconcreteness,tobeabletobedynamicandfilledwithsomespecificlegalmeaningatonce. (…) Their specific role in the formative stage of new rules (at the legislative80Kolb, Netherlands International LawReview (2006), 7. Theword “principle” comes from the Latin“primiumcapere”andmeanssomethingwhichgeneratessomethingelse.Indeed,principlesareusedbyjudges in order to decide themost difficult cases in order to find out rules to be applied in cases oflacunaeoflawandinordertoavoidanonliquet.81Wehland (2013) (n. 78), 132,hasput indirect relationship lis pendens and judicial economy, statingthatsuchcanonistherealrationalebehindthefirstintimerule.82Cheng,GeneralPrinciplesofLawasAppliedbyInternationalCourtsandTribunals(1953),24.83SeeCertainNorwegianLoans (France v.Norway) (Jurisdiction) [1957] ICJRep9, at 53;Nuclear Tests(AustraliavFrance)(Merits)[1974]ICJRep253,at268;MilitaryandParamilitaryActivitiesinandAgainstNicaragua(Nicaraguav.UnitedStatesofAmerica)(JurisdictionandAdmissibility)[1984]ICJRep392,at419; Border and Transborder Armed Actions (Nicaragua v. Honduras) (Jurisdiction and Admissibility)[1988],ICJRep.68,at105-106;PhoenixActionLtdv.CzechRepublic,ICSIDCaseNo.ARB/06/5,Award,15April2009,para.107.SeealsoO’Connor,GoodFaithinInternationalLaw(1991),5andss.,Conforti,Il principio di buona fede (1987), 89 and ss., Kolb (2006) (n. 80), Cremades, American UniversityInternationalLawReview(2012),781,Mitchell,MelbourneJournalofInternationalLaw(2006),341,DeBrabandere(2012)(n.10),609,Kotzur,MaxPlanckEncyclopediaofPublicInternationalLaw(2012)par.1andss.,ZiccardiCapaldo,Attidel convegno inmemoriadiLuigiSico (2011),510.Reinhold, ssrn.com(2013),2has–onthecontrary–arguedthatgoodfaithserves“amediatoryrolebetweenaruleandaprinciple”.TheconceptofgoodfaithhasbeendeeplyanalysedbyLitvinoff,TulaneLawReview(1997),1646andss.

123

level)andtheirdynamicfunctionintheapplicationofthelawindeedpermitstolookatthemasatypeofsourceoflawwhichgoesfarbeyondtheideaofsubsidiaryfillinglacunae”.84

Inthepresentparagraphwewillbrieflyanalysetheprinciplesofgoodfaithandnebis in idem, inordertointroducethedoctrinesofabuseofprocess,whichdirectlyderivesfromtheprincipleofgoodfaith,andresjudicataandcollateralestoppel,whicharespecificationsoftheprincipleofnebisinidem.Suchdoctrineswillbeproposed,inthe remainingpartof thisChapter, as apossible solution to theproblemofparallelproceedings.

GoodfaithTheprincipleofgoodfaith,whichhasbeenlargelyrecognizedasa“generally

accepted principle of international law”,85 “requires every right to be exercisedhonestlyandloyally.(…)Areasonableandbonafideexerciseofarightinsuchacaseisonethatisappropriateandnecessaryforthepurposeoftheright(…).Itshouldatthesame time be fair and equitable as between the parties and not one which iscalculatedtoprocureforoneofthemanunfairadvantageinthelightoftheobligationassumed.(…)theprincipleofgoodfaithestablishesaninterdependencebetweentherights of a State [i.e. of a subject] and its obligations”.86We talk, in this regard, ofmaterial(orsubstantive)goodfaith.Itderivesthattheprincipleofmaterialgoodfaithcontrolstheexerciseofsubstantialrights.Thedirectconsequenceoftheprincipleofmaterialgoodfaithisthat,incaserightsareexercisedinmalafide,anabuseofrightswilltakeplace.

Theprincipleofgoodfaithhasalsoaproceduraldimension,i.e.it“requirestheparties not to undertake any actionwhich could frustrate or substantially adverselyaffecttheproperfunctioningoftheprocedurechosen,thepointbeingtoprotecttheobjectandpurposeoftheproceedings.(…)itisperfectlyopentoapartytofurtheritsown interestsevenat theexpenseof theotherparty.But this selfishnesshas somelimits. It cannotdisregard requirementsof aproper functioningof theprocedureas

84Kolb(2006)(n.80),9.85 Aust, Handbook of International Law (2010), 8, has talked about a fundamental principle ofinternationallaw.SeealsoTamburini,Trattamentodeglistranieriebuonafedeneldirittointernazionalegenerale(1984),44andss.TheAuthorexpresslycriticizestheopinionexpressedinZoller,Labonnefoiendroit internationalpublic (1977), 1andss.,according towhomgood faithwouldnotbea sourceofrightsanddutiesbutonlyacanonofethics.Theopinionthatgoodfaithisasourceofinternationallaw,essential in order to integrate the lacunae of the system, has been strongly already expressed bySperduti,Lacomunitàinternazionale(1952),42andss.,andVirally,AmericanJournalofInternationalLaw (1983), 133. See alsoCertainGerman Interests inPolishUpper Silesia (Germany v. Poland) [1926]PCIJ (Ser.A)No. 7, 33. This approachhasbeenpartially criticizedbyCurtiGialdino,Rivistadi dirittointernazionale(1960),427andss.86Cheng(1953) (n.82),123-126.The ideathattheprincipleofgoodfaith isrelatedtotheprincipleofequalityofthepartiesintheproceedingshasbeenalsoexploredbySereni(1955)(n.38).However,thislastAuthor stated that theprincipleofgood faithderives fromtheprincipleofequalitybetween thepartiesandisnotonitssamelevel.

124

such”.87Thedirecteffectofaviolationoftheprincipleofproceduralgoodfaithisthat,incaseaprocess is initiatedorconducted inbadfaith,anabuseofprocesswill takeplace.88 The above distinction betweenmaterial and procedural good faith has beenendorsed in investment arbitration by the Abaclat Tribunal.89While material goodfaith regards the modalities with which an investment has been assumed (and inparticular the legality of the investment in light of the applicable law), proceduralgoodfaithconcerns“thecontextandtheway inwhichaparty,usuallythe investor,initiates the (…) claim seeking protection for its investment”. Such a distinctionentitles us to talk about abuse of rights and abuse of process in investmentarbitration.

Itisworthrepeatingherethattheprincipleofgoodfaith,bothproceduralandsubstantial, has a common core, i.e. the necessity to exercise a right in compliancewith the goals of this right andwithout the aim of generating a prejudice to otherparties. However, the principle of good faith requires to be filled in by judges on acase-by-case basis, keeping into account the concrete circumstances of the singlecase. For this reason it is essential to highlight the very active role of judges andarbitrators inapplyingboththeprincipleofgood faithandthederivingdoctrinesofabuseofright/process.90

Asalreadystated,forthesakeofthepresentbook,wewillonlyfocusonthedoctrineofabuseofprocess,whichwillbedeeplyanalysedinparagraph3.5below.

87Kolb(2012)(n.16),831.TheproceduraldimensionofgoodfaithisperfectlyexplainedbyArt.3(10)oftheDSU,statingthatWTOMemberswillengageinWTOdisputesettlementproceduresingoodfaith.Seealsoart.300oftheUNCLOS,regarding“goodfaithandabuseofrights”andArt.38ofthePeruvianLeydeArbitraje(D.O.2008,1071),statingthat“thepartiesarerequiredtorespecttheprincipleofgoodfaith inallof theiractsandparticipations inthecourseofarbitralproceedingsandtocooperatewiththearbitraltribunalinthedevelopmentofthearbitration”.88See in this regard Ascensio, Chinese Journal of International Law (2014), 777, according to whom“goodfaith isageneralprincipleof international lawandtheconceptofabuseofprocess isdeducedformthisprinciple inallsystemsof law”.dallaMassara,Rivistadidirittocivile(2008),hashighlightedthat the principle of good faith and the related doctrine of abuse of process are useful in order tosafeguardthevalueswhichconstitutetheheartofanylegalsystem.89Abaclatandothersv.Argentina(supran.8),paras.647-649.90Tamburini(1984)(n.85),50.

125

Nebisinidem According to the principle of ne bis in idem (also called principle of finality,accordingtotheLatinmaxim“interestreipublicaeutsitfinislitium”),somethingthathas been judicially decided once, cannot be decided again. Such a definition of theprincipleoffinalityassumestheperspectiveofthejudge,whocannothearadisputethathasbeenalreadydecided.Theprinciplecanbealsoseenfromtheperspectiveoftheparties:forthem,onceissued,adecisionisfinalandbindingandprecludesanewdiscussionofthecase.91Fromtheperspectiveofajudge,theprincipleissaidtohaveanegativeeffect,whilefromtheperspectiveoftheparties it issaidtohaveapositiveeffect.92Intheopinionofthepresentauthorthepositiveandthenegativeeffectsaretobeconsideredastwosidesofthesamecoin:the issuecannotbediscussedagainbecausetheawardisbinding,andviceversa.93

Nebis in idem is themainanswer thatalmostall legalsystemshavegiventothepublicnecessitiesoffinality,94efficiency95andlegalcertainty;atthesametime,ne

91SeeVolpino,L’oggettodelgiudicatonell’esperienzaamericana(2007),1andss.92AsithasbeennotedbyVolpino(2007)(n.91),47,thecaselawandscholars(inparticularintheUS)havemainly considerednebis in idem from itsnegativeperspective,which is consideredessential toensurefinality.93Theprinciplehasa very longhistory.Wecan indeed find it inGreek,RomanandoldEcclesiasticalLaw.SeeBarnett,ResJudicata,EstoppelandForeignJudgments(2001),8andss.,VanBockel,TheNeBisinIdemPrincipleinEULaw(2009),1andss.Itshouldbenotedthatthenegativeeffectoftheprinciplehas been occasionally questioned. SeeWehland (2013) (n. 78), 182. However, this opinion does notseemtofindsupportinotherAuthorities.ThisisconfirmedbythesameWehland,at193,whenhesaysthat “one could imagine a preclusive effect, where forums in a second set of proceedings wouldaltogetherbepreventedfromrenderinganewdecisiononthemeritsofthedispute”.94An exceptional plea against finality can be found in Sinai, Duke Journal of Comparative andInternationalLaw(2011),387andss.95See Comoglio, Il principio di economia processuale, vol. 2 (1980), 109. See also Blonder-Tongue v.University of Illinois Foundation, 402 US 313 (1971, , 328-329, where it has been stated that “in any

GoodFaith

Substantial

AbuseofRights

Procedural

AbuseofProcess

126

bisinidemservestheprivateinteresttoprotectindividuals,ensuringthemthatonceadispute is decided, it will be final and binding. It is largely recognized as a generalprinciple of international law.96Indeed, the principle ofne bis in idem has found anextremelybroadapplication.Ithasbeenrecognizedbycivilandcommonlawyers,aswellas incommercialandcriminal law.97Ithasbeenconsidered“essentialto judicialoperation,totheorderlyworkingofthejudicialbranch.Ifdisputantscouldjustreopentheiradjudicateddisputes,therewouldbenoendto litigation,noranybeginningofauthority. Finality is not just an efficient policy, it is a necessary condition for theexistenceofthejudiciary”98(emphasisinoriginal).Indeed“thedoctrineofresjudicatais primarily one of public policy and only secondarily of private benefit to individuallitigants”(emphasisadded).99 With regard to this principle, there is no uniformity in terminology. SeveralAuthorities prefer to talk about the principle of res judicata.100However the samename res judicata is alsooftenused– ina stricter sense– tomake reference to thedoctrineofclaimpreclusion,101whichisaspecificationofthebroaderprinciplethatwehavecallednebisinidemandthatwillbeanalysedlaterinthisparagraph.102Inordertoavoidconfusion,wewill refer tonebis in idem as thegeneralprinciple,while thenameresjudicatawillbeusedtorefertothelessbroadconceptofclaimpreclusion. It is, in theory, possible to distinguish between a substantivene bis in idem,according to which someone cannot pay more than once for the same acts or

lawsuitwhereadefendant,becauseof themutualityprinciple, is forced topresentadefenseon themerits to a claimwhich the plaintiff has fully litigated and lost in a prior action, there is an arguablemisallocationofresources”(emphasisadded).96See Cheng (1953) (n. 82), 153 and 336, Lowe, African Journal of International & Comparative Law(1996), 38, Shany (2003) (n. 65), 245, Reinisch (2004) (n. 64), 44, Nguyen (2013) (n. 68), 144. Theprinciple has been affirmed in several decisions. See, inter alia, Société Commerciale de Belgique(Belgiumv.Greece)1939PCIJ(Ser.A/B)No.78,at174;PolishPostalServiceinDanzig,1925PCIJ(Ser.B)No. 11, at 30; Interpretationof JudgmentsNos. 7 and8Concerning the caseof theFactoryatChorzow(Germanyv.Poland),1927PCIJ(Ser.A)No.11,at21;FactoryatChorzow(Germanyv.Poland),1927PCIJ(ser.A)No.17(Merits)(DissentingopinionofJudgeEhrlich);OrinocoSteamshipCo.(USv.Venezuela)11RIAA227,239(1910);Petrobartv.KyrgyzRepublic,SCCCaseNo.126/2003,Award,29March2005,64;WasteManagement Inc. v. UnitedMexican States (No. 2), ICSID CaseNo. ARB(AF)/00/3, Decision onPreliminaryObjection,26June2002.TheonlydissentingvoicehasbeenSacerdoti,TDM(2005),104-105.HoweverSacerdoti’sposition,expressedinalegalopinionintheCMEcase,goesagainstwhathasbeenunanimouslysaidforvariouscenturies.97SeePalombino, ItalianYearbookof International Law (2002),123and ss.,Hober (2013) (n. 64), 126andss.,Conway,InternationalCriminalLawReview82003),217andss.,Varvaele,UtrechtLawReview(2005),100andss.,Aghenitei,Flamanzeanu,ChallengesoftheKnowledgeSociety(2011),131andss.,Luparia,Lalitispendenzainternazionale(2012),34andss.,PerezManzano,Laprohibicionconstitucionaldeincurrirennebisinidem(2002),1andss.98Casad,Clermont,ResJudicata(2001),4.99SeeCocaColaCo.v.Pepsi-ColaCo.,36Del.(6W.W.Harr.)124,130,172Atl.260,262(1934).SeealsoVestal,IowaLawReview(1964),45.100See,interalia,Cheng(1953)(n.82),153and336,Lowe,(1996)(n.96),38,Shany(2003)(n.65),245,Reinisch(2004)(n.64),44,Nguyen(2013)(n.68),144.101See,interalia,Brower,Henin,Kemperink,BuildingInternationalInvestmentLaw:TheFirst50YearsofICSID(2015),55.102The ideathatthedoctrineofres judicata isanexpressionofthebroaderprincipleofnebis in idemhasbeenclearlyexpressedbyLeo,Dirittopenaleeprocesso(2008),513.

127

omissions, and a proceduralne bis in idem, according towhich a person cannot bejudgedmorethanonceforthesameoffence.However,contrarytowhatwehavesaidforgoodfaith,thedistinctionbetweenthesubstantialandproceduraldimensionsofthe principle seems useless in this case; indeed, it seems that there exist only oneprincipleofnebis in idem,whichhavebothsubstantialandproceduralvalue.103Suchaspectsare in fact thetwosidesof thesamecoin, i.e. the fact that therecannotbemorethanonejudgmentforthesamedispute. Thebroadapplicationof thenebis in idemprincipleallaroundtheworldhasbrought to different developments of the same principle. Such differences regardmainlytwoaspects. Firstofall,itiscommonlysaidthatthenebisinidemprincipleisbasedontheapplicationofthealreadymentionedtripleidentitytest,i.e.identityofparties,claimandlegalbasisoftheclaim.However,aswewillseeinparagraph3.6below,thereisnouniformity(bothininternationallawandamongmunicipalsystems)onthecontentoftheserequirements.Justtomakeanexample,wecouldaskourselveswhethertherequirementof thesamepartiesshallbe intendedas referringtoparties ina formalsense(i.e.thenominalparties)or inasubstantialsense(i.e.thecentresof interest);whethertherequirementofthesameclaimshallbeintendedtocoveronlywhathasbeenformallyclaimedbythepartiesoralsowhattheycouldhaveclaimedbutdidnotclaim;or, finally,whether the requirementof identityof the legalbasisof theclaimshallbeintendedinaformalwayorinabroadersense.Allthesedoubtsarestillopenininternationallaw104andletShanytalkabouta“somewhatinconsistent”applicationoftheprincipleoffinalityininternationallaw.105 Secondly, while civil law systems have developed only the concept of claimpreclusion(usuallyreferredtoasresjudicata),i.e.theideathatajudgmentonaclaimprecludesanotherdiscussionofsuchclaim,commonlawyersalsoapplythedoctrineof issue preclusion (usually referred to as collateral estoppel), according to whichissues or fact or law actually litigated and determined within a broader claim, andwhichwereessentialforthejudgmentonsuchclaim,cannotbelitigatedagain.106 In lightof theabovewecanonly talkabouta “nebis in idem family”,107suchfamilybeingcomposedofseveraldoctrines,asdescribedinthechartbelow.

103ThisideahasbeenalreadydevelopedbyPalombino(2002)(n.97),132.104Nguyen(2013)(n.68),146.105Shany(2003)(n.65),253.106SeePolasky,IowaLawReview(1954),217,statingthat“collateralestoppel,despiteitsdevelopmentquiteapart fromtheotheraspectsof res judicata, seemsnow tobeclassifiedasonlya facetof thatbroadgenericconcept”.107VanBockel(2009)(n.92),34.

128

Paragraphs 3.6 and 3.7 below will be aimed at deeply examine the variousapproaches and ideas underlying the ne bis in idem family. We will analyse theirapplication in municipal law and their status in international law in order tounderstand which of them could be a useful instrument in order to avoid parallelproceedingsininvestmentarbitration.

3.5 AbuseofprocessininternationalinvestmentarbitrationIn investment arbitration an abuse of process takes placewhen an investor,

owning a certainprocedural right, exercise its right in away, or for a scope, that iscontrarytotheaimforwhichsucharighthasbeengranted(i.e.inbadfaith).108ThisentitlestheTribunaltoprecludetheexerciseofthatrightbytheclaimantbywayofadeclarationofinadmissibility,althoughsuchrightisanactualandvalidone.109

The following can be identified as the main requirements for an abuse ofprocesstooccur:

a)theownershipofavalidproceduralright;b)thepossibilitythat,inabstracto,suchproceduralrightcanbeexercisedalso

forscopeswhicharedifferentfromtheonesforwhichtherighthasbeengranted;

108Pino,Eguaglianza,ragionevolezzaelogicagiuridica(2006),116.109De Brabandere (2012) (n. 10), 619-620. Ascensio (2014) (n. 88), 784. See also, on the doctrine ofabuseofrightsininternationallaw,Gestri,Rivistadidirittointernazionale(1994),5andss.Withregardto thedoctrineofabuseof right inEU lawseeLosurdo, Ildivietodiabusodeldirittonell’ordinamentoeuropeo (2011), 107 and ss., Gestri, Abuso del diritto e frode alla legge nell’ordinamento comunitario(2003),1andss.

NeBisinIdem

ResJudicata(ClaimPreclusion)

RigidApplicationoftheTripleIdentityTest

FlexibleApplicationoftheTripleIdentityTest

CollateralEstoppel(IssuePreclusion)

129

c)theexerciseoftheproceduralrightforascopethat,inconcreto,generatesaprejudicetotheotherpartyandtotheproperfunctioningoftherelevantmethodofdisputesettlement.

However, the same existence of the doctrine of abuse of process has beenquestioned (in particular in investment arbitration) due to:110(i) the lack of a legalbasisforit;111(ii)anerosionoftheprincipleofpartyautonomy;(iii)apossibleviolationoftheprincipleofdueprocess.

Inordertoanswersuchcriticismsitisnecessarytostartfromabriefreference,ingeneralterms,tothedoctrineofabuseofrights.

InthewordsofHerschLauterpacht,“[t]heessenceofthedoctrine[ofabuseofrights] is that, as legal rights are conferred by the community, the latter cannotcountenance their antisocial use by individuals; that the exercise of a hitherto legalrightbecomesunlawfulwhenitdegeneratesintoanabuseofrights;andthatthereissuchanabuseofrightseachtimethegeneralinterestofthecommunityisinjuriouslyaffectedastheresultofthesacrificeofanimportantsocialorindividualinteresttoalessimportant,thoughhithertolegallyrecognizedindividualright”.112Theconvictionthat every right shall be exercised fairly and in good faith, thus avoiding anti-socialeffectsderivingfromtheexerciseofsuchright,isdeeplyrootedinallthesystemsoflaw113andhasbeenconsidered,evensincetheearly twentiethcentury,asageneralprincipleof law.114Itderivesthatonlyarightthat isexercised ingoodfaithdeservesthe protection of the law. This is today also expressly recognized by some

110See,withregardtothenotionofabuseofprocessingeneral,Scarselli,Rivistadidirittoprocessuale(2012),1467andss.,PicòyJunoy,Rivistadidirittoprocessuale(2013),171andss.,Cordopatri,Rivistadidiritto processuale (2012), 883 and ss. A general attempt of balancing abuse of process andfundamentalrightshasbeentriedbyComoglio,Rivistadidirittoprocessuale(2008),319andss.111See,ingeneralterms,thecriticismsreportedbyAscensio(2014)(n.88),764.112Lauterpacht,TheFunctionofLawintheInternationalCommunity(2010ed.),294.ThehistoryofthedoctrineofabuseofrightsisdeeplyanalysedbyLettieri,Marini,Merone,L’abusodeldirittoneldialogotracortinazionaliedinternazionali(2014),18andss.113See Byers, McGill Law Review (2002), 391 and ss. The Author perfectly demonstrates the wideapplicationofthedoctrineofabuseofrightsinbothcivilandcommonlawsystems.114Lauterpacht(2010ed.)(n.112),300andss.TheAuthorexplainsthat,athistime,evenifthecommonlawworlddidnotknowthedoctrineofabuseofright, ithadequivalentprinciplesthatsuppliedto itsfunction.AccordingtotheAuthor,at308,“thepossibilitiesoftheapplicationofthedoctrineofabuseof rights in relations among States are manifold”. See also Iluyomade, Harvard International LawJournal(1975),47andss.Withregardtothecaselaw,seetheLighthousecase(Turkeyv.Greece),[1934]PCIJ(Ser.A/B),No.62,CertainGermanInterestsinPolishUpperSilesia(Germanyv.Poland)[1926]PCIJ(Ser. A) No. 7, Free Zone Case (France v. Switzerland) [1932], PCIJ (Ser. A/B) No. 46, Nottebohm(Liechtenstein v.Guatemala) [1955] ICJ4, 370,BarcelonaTraction (Belgiumv.Spain) [1970] ICJ 1, 324.SeveralothercasesarementionedinGestri(1994)(n.109),19andss.ParticularlyrelevantistheAwardof4March1925renderedintheTacna-AricaadhocarbitrationbetweenChileandPeru,wherethesolearbitratorexpresslyendorsedthedoctrineofabuseofrightsasbasisforitsdecision,statingthatChileuseditslawswiththesolepurposeofgeneratingdamagetoPeruvianpeople.

130

international sources of law,115as well as in the vast majority of national legalsystems.116

The theory of abuse of rights has been recognized also in investmentarbitration,notwithstandingthefactthatitusually117lacksofanormativebasis.118Itishereworthquotingpara.646oftheDecisiononJurisdictionandAdmissibilityissuedin theAbaclat case: “(…) the theoryof abuseof rights is anexpressionof themoregeneralprincipleofgoodfaith(…)afundamentalprincipleofinternationallaw,aswellasinvestmentlaw.Assuch,theTribunalholdthatthetheoryofabuseofrightsis,inprinciple,applicabletoICSIDproceedings”.

In fact it is possible to observe that procedural rights have nothing differentfromotherrights,unlessthefactthattheyaretobeexercisedinacertaincontext,i.e.aprocess.Asaconsequence,suchrightscanbeabused.Therighttoinitiateaprocessmayitselfbeabused,incasetheprocessisnotinitiatedforthescopeofdoingjustice,butwiththeaimof takinganundueadvantageorcreatingharassmenttotheotherparty.119Ingeneral terms,allprocedural rights shallbeexercisedavoiding toundulybypassother rightsorprocedural fundamental rules.This isadirectconsequenceofthe same fact that procedural rights are rights.120This is confirmedbyLauterpacht,whenhesays that“[i]t iseasy toseewhythedoctrine thusconceived [i.e.abuseofrights]canberegardedasoneofgreatpotentialitiesintheprocessofjudiciallegislationadjustingthelawtonewconditionsandpreventingunfairoranti-socialuseofrights”.121Thelogicalconsequenceofthisstatementisthatapartycannotuseaprocessinorderto obtain a personal advantage regardless ofwhether the initiation of that process

115See, interalia,Art.54of theEuropeanCharterofHumanRights.Forother referencesseeLettieri,Marini,Merone(2014)(n.112),24andss.SeealsoArt.XXoftheGATT,whichhasbeenseenasarule“settingoutaright(…)andthenforbiddingitsabuse”byDiBenedetto(2013)(n.61),126.116See Gestri (2003) (n. 109), 24-52, who has conducted a comparative analysis in relation to theapplicationabuseofrightsinnationallegalsystemswithintheEU.SeealsoLosurdo(2011)(n.109),25-36.117Thereisastrongdebateamongscholarswithregardtothenecessitythatinvestmentsaremadeingood faith and/or in accordancewith the law of the host State. SeeĐajić, Proceedings ofNovi SadFacultyofLaw (2012),207andss.,Carlevaris,JournalofWorldInvestmentandTrade(2008),35andss., Tirado, Page,Meagher, ICSID Review FILJ (2014), 493 and ss., Lamm,Greenwald, Young, ICSIDReview FILJ (2014), 328 and ss., Kriebaum, Austrian Arbitration Yearbook 2010 (2010), 307 and ss.,Obersteiner, Journal of International Arbitration (2014), 265 and ss.,Maniruzzaman, Amicus Curiae:JournaloftheSocietyforAdvancedLegalStudies(2012),16andss.118See, inter alia,Mr. FranckCharlesArif v.Republic ofMoldova, ICSIDCaseNo.ARB/11/23,Award,8April 2013,Malicorp Limited v. The Arab Republic of Egypt, ICSID Case No. ARB/08/18, Award of 7February 2011. Several other references are contained in Georgilas, ILA Regional Conference 2013,Greece(2013),14andss.119SuchanimproperuseofarightmightberelatedtotheFrenchdoctrineofdétourementdepouvoir,accordingtowhichapowercannotbeusedforagoalthat isdifferentfromtheoneforwhichsuchapower has been provided. The applicability of détourement de pouvoir in international law has beencriticizedbyGestri(1994)(n.109),11.120See,inthisregard,Gestri(1994)(n.109),9and22andss.ThisAuthoralsocitesseveralprecedentsonthepoint.121Lauterpacht(2010ed.)(n.112),294.

131

respects the (already mentioned) fundamental canons of justice.122The process isavailableforthepartiesprovidedthattheymakerecoursetoitaccordingtoitsactualscopes.

It seems therefore possible to say that a judge has the duty to control, inconcreto, that all procedural rights are exercised in good faith, notwithstanding thelack of a normative basis for such power. Such a duty, to be exercised at theadmissibility stage, is an inherent power of every judge and shall be aimed atprotectingthejudicialfunction,theproperfunctioningofproceedingsandtherightsoftheotherpartyintheproceedings.123Onlyrightsexercisedinaway(orforascope)that does not have such undesirable effects are to be considered, let us say,meritoriousanddeservetheprotectionofthelaw.124Fromtheaboveitispossibletounderstandthattheapplicationof thedoctrineofabuseofprocess involvesanhighamount of discretion for judges/arbitrators, who have to check if, in concrete, theexerciseofaproceduralrightis,toborrowLauterpacht’swords,anti-social.125

AccordingtoRobertKolb,even if the ICJ“hasneverfoundtheconditionsforanapplication”126ofabuseofprocess,thisdoesnotexcludethatsuchdoctrinecannotfindaplaceinitscaselaw.However,itisworthnotingthatabuseofprocesscanfindits explicit recognition (other than in municipal laws)127 in several internationalsources, such as Art. 35(3) of the European Convention of Human Rights,128Art.294(1)129and300130oftheUnitedNationConventionontheLawoftheSeaandArt.

122Ghirga,Lameritevolezzadellatutelarichiesta(2004),78and89andss.ForareferencetoefficiencyandjudicialeconomyseealsoLettieri,Merini,Merone(2014)(n.112),40.123Ghirga,(2004)(n.122),77.124Ghirga, (2004) (n. 122), 89 and ss. In 1982, inHunter v. Chief Constable of theWestMidlands, theHouseofLordsstatedthatabuseofprocessisessentialtoprevent“theadministrationofjusticemightbebroughtintodisreputeamongright-thinkingpeople”.125All the above is confirmed in the Interim Report: "Res judicata" and Arbitration issued by theInternational Law Association, Berlin Conference, in 2004, 8, par. E. Gestri (1994) (n. 109), 10, hascriticizedthedefinitionofabuseofrightsonthebasisoftheanti-socialexerciseofsucharight,statingthat,usedinthisway,abuseofrightmightbecomeawaytogivelegislativepowerstojudgesandthiswouldunderminetheprincipleoflegalcertainty.Duetotheproactiveroleofinternationaljudges,suchan idea isnotconvincingwith regardto international law.Thepresentauthor, therefore, fullysharesLauterpacht’sapproach.126Kolb(2012)(n.80),831.127SeeGaffney,JournalofWorldInvestmentandTrade(2010),515andss.,recallingapplicationsofthedoctrine inCanada,England,Australia andUnitedStates. Today thedoctrine finds application, interalia, also inFrance, ItalyandSwitzerland.ForadetailedanalysisofUSpractice seeDondi,Rivistadidirittoprocessuale(1995),787andss.AbuseofprocessdoesnotseemtoberecognizedinSweden.SeeCaseT8735-01,judgmentof15May2003,paras.187-188.128“The Court shall declare inadmissible any individual application submitted under Article 34 if itconsidersthat:

(a)theapplicationisincompatiblewiththeprovisionsoftheConventionortheProtocolsthereto,manifestlyill-founded,oranabuseoftherightofindividualapplication;or(b)theapplicanthasnotsufferedasignificantdisadvantage,unlessrespect forhumanrightsas defined in the Convention and the Protocols thereto requires an examination of theapplicationonthemeritsandprovidedthatnocasemayberejectedonthisgroundwhichhasnotbeendulyconsideredbyadomestictribunal”.(Emphasisadded).

129“Acourtortribunalprovidedforinarticle287towhichanapplicationismadeinrespectofadisputereferred to in article 297 shall determine at the request of a party, ormay determine propriomotu,

132

3(10)oftheWTODisputeSettlementUnderstanding.131AccordingtoVaughanLowe,however, regardless of a normative recognition, the doctrine is “well established,though occasions for its application are likely to be very rare. It indicates that atribunals should decline jurisdiction in a rangeof circumstanceswhere the action isrendered vexatious. These include cases where the purpose of the litigation is toharassthedefendant,ortheclaimisfrivolousormanifestlygroundless”.132

Itisdifficult(andmaybetooearly)tosayherewhetherabuseofprocesscanbeconsideredasanautonomousprincipleofinternationallaw.Itseemsthat,ifseenasaproceduralexpressionofthegeneralprincipleofabuseofright,abuseofprocesscanfind a place in international law.133It is not debatable, however, that internationalcourtsandtribunalshavetheinherentpowertoprecludeaclaimtogoaheadifsuchaclaim,inconcrete,amountstoanabuseofprocess.

With particular regard to international investment arbitration, all the abovedebate is very relevant. Indeed, being investment arbitration a form of disputesettlementthatinvolvesseveralpublicinterests,itisofcertainimportancethatsuchformofjusticeisnotabusedtothedetrimentofStateparties.Indeed,severalrecentcaseshavediscussedtheexistenceandtherequirementsofthedoctrineofabuseofprocessasawaytobalancetheover-formalisticapproachtojurisdiction,ontheoneside,withthesubstantialnecessityofaproperadministrationofjustice,ontheotherside. Such cases mainly regarded a change of the investors’ corporate structure,aimed at gaining the advantages of a certain BIT. In various cases Tribunals havestatedthat,ifthefinalowneroftheallegedinvestorhadthesamenationalityofthehostState(oranationalityofaStatewhichwasnotapartyoftherelevantBIT)andsuch final owner purposefully modified the corporate structure in order to get theadvantage of a BIT after a dispute arose, such conduct amounted to an abuse ofprocess.134Inthesecases,therecoursetothedoctrineofabuseofprocesshasnotbeen

whethertheclaimconstitutesanabuseoflegalprocessorwhetherprimafacie it iswellfounded.Ifthecourt or tribunal determines that the claim constitutes an abuse of legal process or is prima facie unfounded,itshalltakenofurtheractioninthecase”.(Emphasisadded)130“States Parties shall fulfil in good faith the obligations assumed under this Convention and shallexercisetherights,jurisdictionandfreedomsrecognizedinthisConventioninamannerwhichwouldnotconstituteanabuseofright”.(Emphasisadded)131“It is understood that requests for conciliation and the use of the dispute settlement proceduresshouldnotbeintendedorconsideredascontentiousactsandthat,ifadisputearises,allMemberswillengage in these procedures in good faith in an effort to resolve the dispute. It is also understood thatcomplaints and counter-complaints in regard to distinct matters should not be linked”. (Emphasisadded)132Lowe,AustralianYearbookofInternationalLaw(1999),202.133Ascensio(2014)(n.88),779.134PhoenixAction Ltd. v. the CzechRepublic, ICSIDCaseNo.ARB/06/5,Award, 15April 2009;EuropeCementInvestment Tradev.RepublicofTurkey,ICSIDCaseNo,ARB(AF)/07/2,Award,13August2009;Cementownia "Nowa Huta" S.A. v. Republic of Turkey, ICSID Case No. ARB (AF)/06/2, Award, 17September 2009;RenéeRose Levy andGremcitel S.A. v. Republic of Perù, ICSIDCaseNo.ARB/11/17,Award, 9 January 2015;Pac RymCayman LLC v. Republic of El Salvador, ICSIDCaseNo. ARB/09/12,Decisionon theRespondent’s JurisdictionalObjections, 1 June2012.See,withgeneral regard to thedoctrine of abuse of process and the changes of corporate structure, Cerny, Czech Yearbook of

133

(and cannot be) seen as a limitation of party autonomy and due process: if a partyunlawfullyexercisesitsproceduralrights,andthenthisunlawfulexerciseisprecludedby the tribunal, such a party cannot further claim that it has been deprived of itsrights!Modernprocedural lawhas, indeed,developed the idea thatall the formsofprotectiongranted inaprocessareconditionedtothecircumstancethatproceduralrightsareexercised ingoodfaith. It isnotsurprisingthatsuchprinciple isapplied ininvestmentarbitration.

Abuseofprocesshasbeendescribedasaperfectwayofattractingattentionon “systemic malfunctioning”135and to preclude the continuance of proceedingswhich run against fundamental canons of procedure and at the same time can beextremelyonerousfortheotherparty.Itcanbesaidthat“thefunctionoftheconceptistocorrectatooformalisticapproachoftheprocedure,takingintoaccountelementsofsocialfinalityandfairness”.136

It is here submitted that, even if there has never been a decision expresslyapplyingabuseofprocessinordertopreventparallelproceedings,137abuseofprocesscanbeavaluabletoolinordertoavoidthat–bypassingsomefundamentalcanonsofprocedure(i.e.theneedsforfinality,efficiencyandproperadministrationofjustice)aswellastheprincipleofnebis in idem–someparties initiatemultipleproceedingsonthebasisofthesameidenticaldispute.138InthewordsofChesterBrown,usedinthiswayabuseofprocesswouldbe“aruleofpublicpolicybasedonthedesirability, inthegeneral interest aswell as that of the parties themselves, that litigation should notdrag on forever and that a defendant should not be oppressed by successiveproceedingswhenonewoulddo”(emphasisadded).139

International Law (2012), 183 and ss., Voon, Mitchell, Munro, Journal of International DisputeSettlement(2014),41andss.,Topcan(2014)(n.17),627andss.,Daujotas,ssrn.com(2012),1andss.135Ascensio(2014)(n.88),785.TheideatoletsubstanceprevailonformisalsoconfirmedbyProsperWeil’s dissenting opinion in Tokios Tokeles v. Ukraine, ICSID Case No. ARB/02/18, Decision onJurisdiction,DissentingOpinionofProsperWeil,29April2004,para.19andss.,inwhichhefocusedonthegoalsoftheICSIDregimeandontheneedtopreservetheintegrityofthesystemandstatedthatinternational courtsmust retain aminimal amount of both effectiveness and legitimacy in order tocontinue to operate. Shany (2003) (n. 65), 259 has put abuse of process in relation to res judicata.According to his opinion “abuse of process doctrine can serve as an additional justification for theadoption of (…) res judicata (…) and perhaps even support a liberal construction of [its] scope ofapplication,sotoencompasscloselyrelatedmultipleproceedings,whichareextremelyonerousforonepartyandofrelativelylittleutilitytotheotherparty.Itmightalsooperatetorestrictunjustifiedclaim-splittingtactics”.SeealsoGhosh,ArbitrationInternational(2015),665andss.136Ascensio(2014)(n.88),764.137On the contrary, inCME v. Czech Republic, UNCITRAL, Final Award 14March 2003, par. 412, theTribunalstatedthat,ifjurisdictionisvalidlyconferred,thecommencementoftwoparallelproceedingscannotbeseenasanabuseofprocess.Thepresentauthordoesnotsharethisopinion,consideringthat– as it will be seen better in Paragraph 3.6 below – theCME Tribunal’s approach fosters abuses ofinvestmentarbitration.138ThisideaseemstobedeniedbyGaffney(2010)(n.127),529.139Brown,TransnationalDisputeManagement(2011),7.

134

ThisapproachisindirectlyconfirmedbytheRSMandGrynbergcase,140wheretheTribunalsaidthat“thepresentcaseisnomorethananattempttore-litigateandoverturnthefindingsofanotherICSIDTribunal(…).Claimants’presentcaseisthusnomorethanacontractualclaim(previouslydecidedbyanICSIDTribunalwhichhadthejurisdictiontodealwithTreatyandcontractualissues)dressedupasatreatycase(…).The tribunal finds that the initiation of the present arbitration is thus an improperattempt to circumvent the basic principles set out in [the ICSID]ConventionArticle 53and theproceduresavailable for revisionand rectificationof awardsprovided for inArticle51”(emphasisadded).ItisstronglyarguablethatthereasoningoftheTribunal,even if not mentioning abuse of process, was referring to and applying such adoctrine.

Thus, bywayof a declarationof inadmissibility, tribunals have the power toprecludesuchabusive(andbadfaith)claimstogoahead.141Thisapproachisfosteredbythefactthatthedoctrineofabuseofprocessseemsapplicablealsoincaseoftwo(or more) parallel proceedings in which the claimants are formally different butrepresentthesamesubstantiveinterests.142SuchanapproachseemstobeconfirmedbytheCommercialCourtofLondoninMichaelWilsonandPartners.Inthisjudgment,Mr. Justice Teare recognized that “mutuality is not a bar to an abuse of processargument”.143Asaconsequence,notwithstandingthefactthepartiesinthepreviousarbitrationwereformallydifferent(butsubstantiallyrepresentedthesameinterest),heexpresslystatedthat“itwouldbeanabuseoftheprocessofthiscourttopermitMWPtomakethesamefactualallegationswhichithadmadeinthearbitrationandhadbeenrejected”.Thisapproachseemstobethecorrectonealsoinordertoavoidabusesofinvestmentarbitration.

3.6 Resjudicata(claimpreclusion) 3.6.1 Definitionofresjudicataanditsroleinensuringthegoaloftheprocess

140InSGrynberg,StephenMGrynberg,MiriamZGrynberg,andRSMProductionCorporationvGrenada,ICSIDCaseNoARB/10/6,Award,10December2010,paras.7.3.6and7.3.7.141Thelegalfoundationofthepossibilitytoissuesuchadeclaration,asstatedbyBrown(2011)(n.139),8,isintheinherentpowersoftheTribunalandinthenecessitytoensuretheproperadministrationofjustice. See alsoWaste Management v. Mexico (No. 2), ICSID Case No. ARB(AF)/00/3, Decision onJurisdictionof26June2002,paras.49-50.AlsoGestri(1994)(n.109),44,hasstatedthatabuseofrightsandabuseofprocessmayberelevantattheadmissibilitystageandthatsuchdoctrinesmayconstituteawayofprotectingthejudicialfunctionofinternationalcourtsandtribunals.AccordingtothisAuthor,such a protective functionmay justify the applicationof abuseof process even in lackof an expressprovisioninwrittensourcesoflaw.142AsstatedbyBrown(2011)(n.139),6,thedoctrineofabuseofprocessdoesnotrequirethefulfilmentofthetripleidentitytest.143 Michael Wilson & Partners v. Thomas Ian Sinclair, Sokol Holdings Incorporated, Eagle PointInvestmentsLimited,ButterfieldBank (Bahamas) [2012]EWHC2560(Comm).Thisapproachhasbeenappliedsince1889inReichelv.Magrath(1889)14AppCas665andhasbeenconfirmedinArthurJSHallv.Simons [2002]1AC615,701and inOMVPetromSAv.Glencore InternationalAG [2014]EWHC242(Comm),para.16andss.SeealsoMonichino,Fawke,AsianDR(2012),123.

135

According to the principle of claim preclusion “a party generally may notrelitigate a claim decided (…) by a valid and final judgment. The judgmentextinguishes the whole claim, precluding all matters within the claim that were orcould have been litigated in that initial action”.144Res judicata regards a claim as awhole and precludes a second discussion of such a claim. The principle of claimpreclusionisrecognizedinalllegalsystems,aswellasininternationallaw.However,notallcountrieshaveappliedtheprincipleofclaimpreclusioninthesameway.145Theprinciple,therefore,hasacommoncore(i.e.,firstofall,theimpossibilitytore-litigateanalreadydecidedclaim)butiscomposedofseveralaspectswhoseapplicationoftenvariesaccordingtothedifferentlegalculturesandwithininternationallaw.146 Firstofall it isworthfocusingontheaspectsoftheprinciplethatseemtobecommonly applied. Firstly, it is commonly said (both in international law andmunicipal law) that, in order to be res judicata, the decision on a claim has to befinal.147Secondly, to acquire the res judicata force, a judgment must be valid, i.e.issued at the end of a judicial procedure.148Thirdly, it seems undisputed that theextent of claim preclusion not only regards what has been pleaded by the partiesduringtheproceedings,butalsoprecludesalltherelatedpleasthatcouldhavebeenfiledbeforethejudgeandwerenot.149Finally,withparticularregardtointernationalarbitration, it is quite unanimously accepted that arbitral awardshave the same resjudicata value of court judgments: as a consequence, arbitral awards preclude aseconddiscussiononthesamecase.150

144Casad, Clermont (2001) (n. 98), 11. See also Brower, Henin, Kemperink (2015) (n. 101), 55. Incommonlawitisusuallydistinguishedbetweenmergerandbar.Wehaveamergerwhentheplaintiffinthe first action is successful and, therefore, is claim is merged in the judgment and cannot be re-litigated. We have a bar when the first judgment is in favor of the defendant and the plaintiff isthereforebarredtostartagainsuchaclaim.145Casad,Clermont(2001)(n.98),5-6.146SeeHahn,AustrianYearbookofInternationalLaw(2014),330-331,Scobbie,AustralianYearbookofInternationalLaw(1999),301.147Hahn(2013)(n.146),331.148Casad,Clermont(2001)(n.98),49.SeealsoCarrington,OhioStateLawJournal(1963),381,whohasexplainedthatthejudgmentshallbevalidaccordingtothelawoftheplacewhereithasbeenissued.149See, interalia,Art.2909oftheItalianCivilCode,Art.400(2)oftheSpanishLeydeEnjunciamientoCivil.On this point seeDe LaOliva Santos,Oggetto del processo e cosa giudicata (2005), 92, Casad,Clermont(2001)(n.98),62andPolasky(1954)(n.106),218.SeealsoBarnett(2001)(n.93),183-244andHenderson v.Henderson (1843) 3Hare 100.As explainedby these lastAuthors, the rule according towhichaplaintiffshallrelitigateinasingledisputeallreliefsarisingfromatransactionisaconsequenceof the need of efficiency of the judiciary. However, it should be noted that the theGenocide case,Applicationof theConventionon thePreventionandPunishmentof theCrimeofGenocide (BosniaandHerzegovinav.SerbiaandMontenegro), JointDissentingOpinionofJudgesRanjeva,ShiandKoroma,ICj Rep. (2007), par. 9, some dissenting Judges stated that “as amatter of principle, a State is notprecludedfromlegallyraisingadistinctclaimarisingfromthesamefacts,whereaseparatepointfallsfor decision within the same legal context”. Contra, see theDelgado case quoted in Paragraph 269below.150SeeHober (2013) (n.64),128andss.,Gordon,FloridaJournalof InternationalLaw(2006),577andss.,Bonato,Rivistadidirittoprocessuale(2006),669andss.,Menchini,Rivistadell’arbitrato(1998),775.SeealsoItalianSupremeCourt16901/2015,aswellasArt.824-bisoftheItalianCodeofCivilProcedure,Art.1484oftheFrenchNewCodeofCivilProcedure,Art.1055oftheGermanZPOandArt.387ofthe

136

Moving to the uncertain aspects of res judicata, as wewill see in Paragraph3.6.2 below, themainpoints of disagreement are related to the triple identity test,according towhich– inorder to res judicata apply – theparties, theobject and thelegalgroundsshallbeidentical.

Asecondpointofdiscussionregardstheextensionofclaimpreclusion.Whileitiscommonlyacceptedthatthefindingscontainedintheoperativepartofajudgmentareresjudicata,thereislesscertaintywithregardtothereasoningofthecourt.Inthisregard,theGermanapproach,whichgivespreclusiveeffectonlytotheoperativepart,is the strictest, while the French approach, which looks at the dispositif and to theunderlyingreasonsisthebroadest.151Inthisregard,however,itisworthnotingthatitisoftenimpossibletocompletelydividethedispositiffromitsunderlyingreasonsand,evenifonewouldacceptthatonlytheoperativepartofthejudgmentgeneratesclaimpreclusion,itisimpliedthatsuchoperativepartneedstobeunderstoodandexplainedby its underlying reasons. Indeed, the Court of Justice of the European Union hasstated that “the concept of res judicata under EuropeanUnion law does not attachonlytotheoperativepartofthejudgmentinquestion,butalsoattachestotheratiodecidendi of that judgment, which provides the necessary underpinning for theoperative part and is inseparable from it”152(emphasis added). This seemsalso tobetheapproachfollowedbyinternationalcourtsandtribunals.153 Thereare,finally,somedistinctionswhichareappliedinsomesystemsandnotin others. The main one regards the difference between formal res judicata andsubstantialresjudicata(mainlyrecognizedbythecivillawsystems).154Theformalresjudicata has tobe seen fromtheproceduralpointof view, i.e.adecision that isnotsubject to any further appeal constitutes formal res judicata. The substantial resjudicata,onthecontrary,regardstherelationshipunderlyingtheprocess:adecisionis

Swiss Code of Civil Procedure. The issue of the res judicata of international arbitration awards innationallegalsystemsandviceversawillbeexaminedinParagraph3.6.5below.151Alsocommonlawsystemsseemtoacceptthat“resjudicataaffectsbothpremisesandconclusions”.SeeMillar,MichiganLawReview(1940),4.152Decision of 15 November 2012, C-456/11,Gothaer Allgemeine Versicherung AG ed altri c. SamskipGmbH,par.40. 153See,exmultis, the detailed reasoning developed inApotexHoldings Inc. andApotex Inc. v.UnitedStatesofAmerica, ICSIDCaseNo.ARB(AF)/12/1,Award,25August2014,paras. 7.23andss.SeealsoBarcelona Traction, Light and Power Co Ltd (Belgium v. Spain) (Second Phase) [1970] ICJ Rep 3, 267,separateopinionofJudgeGros,statingthatevenifitiscommonlysaidthatresjudicataonlyreferstotheoperativepartofa judgment, it is also commonlyaccepted that international courts refer to thereasoning set forth in previous decisions. See alsoCompagnie Generale de l’Orenoque Case (Franco-Venezuelan Mixed Claims Commission 1905), Pious Fund Arbitration (United States of America v.Mexico), and Channel Arbitration, mentioned in Schreuer, Reinisch, Legal Opinion in CME v. CzechRepublic (2002), 23. See also Hober (2013) (n. 64), 321 and ss., Cheng (1953) (n. 82), 348-349. ThisopinionseemsnotsharedbyWehland(2013)(n.78),191.154SeeMillar (1940) (n. 151), 7,DeLaOlivaSantos (2005) (n. 149), 107andss.See,asanexampleofformalresjudicata,Art.324oftheItalianCodeofCivilProcedureand,asanexampleofsubstantialresjudicata,Art.2909oftheItalianCivilCode.Another,lessimportant,distinctionisbetweenabsoluteresjudicataandrelativeres judicata,onwhichseeMillar, id.,7.Absoluteres judicata iscognizablebythesecond court regardless of a plea by a party,while substantial res judicata requires that a party filesbeforethecourtarequesttoprecludetheclaimbasedonresjudicata.

137

substantial res judicata in the sense that such a relationship, fromwhich a disputearose, acquire stability (i.e. the dispute is completely settled) on the basis of thebindingforceofajudicialdecision.155Evenifthisdistinctionhasbeenputinquestionon the basis of the fact that “a judgment does not become res judicata in thesubstantial sense until it has achieved the quality of formal res judicata”,156it isessential inordertoletusunderstandthedoublefunctionofanyjudicialprocessand,therefore, to focus on the proper object of any process, including investmentarbitration.

Indeed, it has been correctly pointed out that every process has: (i) aprocedural function, i.e. toput ineffectwhat the lawdictates; and (ii) a substantialfunction, i.e. to finally settle the underlying dispute.157 The procedural functionfocuses on the correct application of the law by the judge, while the substantialfunction focuses on the concepts of dispute and legal relationship underlying theprocess.158It isnotpossible toassumeonlyaproceduralperspective,onthebasisofwhich a judgment fulfils its function (i.e. to ensure finality) just if the judge hascorrectly applied the law. On the contrary, it is strongly arguable that a judgmentreaches itsgoal iftheunderlyingdispute iscompletely(andforever)settled. Indeed,as ithasbeenstated,atsomepoint it isnecessarytoknowwithcertaintytherightsandobligationsarisingfromacertainlegalrelationship;“aparty[ofsuchrelationship]shouldnothavetobringordefendmultiplesuitstoestablishhisrightorobligationsarising out of a single incident [i.e. dispute]”.159This means that, regardless of theformal elements of any single judgment (i.e. the parties, the object and the legalground),resjudicatashallnotpermitaseconddiscussionofthealreadydecidedfactsregarding a certain legal relationship; such facts shall be intended to be definitelysettledbythefirstdecision. Indeed,“[i]fa judgment[is]notconclusiveastowhat itactuallydetermined,theadjudicativeprocesswouldfailtoserveitssocialfunctionofresolvingdisputes”.160

It is, in conclusion, necessary to focus on the public function of investmentarbitration,161i.e.avisionoflitigation“thatismoresensitivetotheneedtoensurea

155Itfollowsthatonlydecisionsonthemeritareabletobecomesubstantialresjudicata,duetothefactthatanyotherdecisiondoesnothavetheeffectofdefinitelystabilize legal relationshipsDeLaOlivaSantos(2005)(n.149),116.156Millar(1940)(n.151),7.157Allorio,Lacosagiudicatarispettoaiterzi(1935),11andss.ThisconcepthasbeenalsodevelopedbyCarnelutti,Istituzionidelprocessocivileitaliano(1956),79.158 In this regard, see also Bonafè, La protezione degli interessi di Stati terzi davanti alla CorteinternazionalediGiustizia,whoproposes–inordertojustifytheinterventionofthirdStatesasapartybefore the ICJ – the acceptance of a larger concept of “dispute”, encompassing also the rights andobligationsofthirdparties.159Arbour,LouisianaLawReview(1974),763.160Currie,TheUniversityofChicagoLawReview(1978),325.161TheprocessualnatureofarbitrationhasbeenstronglyarguedbyVecchione,L’arbitratonelsistemadelprocesso civile (1971), 1andss.According to this view,arbitrationhasapublic functionaswell asnationallitigation.

138

moreeffectiveuseofsocialresourcesandthatrecognizedthepublicconsequencesofanyproceduralregime”,162ratherthanmerelygivingattentiononitsprivatefunction. Given the above, the following discussion will be aimed at analysing therequirementsthatshallbesatisfiedinordertoensurethatthesubstantialfunctionofany investmentarbitration(i.e.tofinallysettle investmentdisputes) issatisfied.Theanalysis will start from an analysis of the traditional approach to res judicata ininternationallaw.Itwillfurtherdiscusswhethersuchanapproachisappropriateanddesirable for investment arbitration. The focuswill finally go to on how arbitratorsshould approach the triple test in order to render it suitable to finally settleinvestmentdisputesandtoensurethegoodadministrationofjustice.

3.6.2 The traditional approach to res judicata: The triple identity test and therequirementofthesamelegalorder.TheCME/Laudercasesandacritictothe triple identity test as an over-formalistic approach, which does nottakeintoaccountsubstance

In international law, the traditional approach to res judicata is explained byJudge Anzilotti’s dissenting opinion in theChorzow Factory: Interpretation Case. Hestatedthat“thedecisionoftheCourthasnobindingforceexceptbetweenthePartiesand in respect of that particular case: we have here three traditional elements foridentification,persona,petitum, causa petendi, for it is clear that the particular casecovers both the object and the grounds of the claim”.163The parties are usuallyconsidered to constitute the subjective scope of application of res judicata, whilepetitum and causa petendi constitute its objective scope of application. Anzilotticonstrued itsdefinitionof theprinciple,whichhasgivenorigin to the triple identitytest, on the basis of what he thought to be the aspects of res judicata that werecommontothevarioussystemsoflaw.164Indeed,AnzilotticonsideredresjudicataasageneralprinciplecommontocivilizednationsinthesenseofArt.38(1)(c)ofthePCIJStatute. Since Anzilotti’s statement, the triple identity test (and in particular therequirementofthesameparties)hasbeenveryoftenrigidlyandformallyapplied,165

162Watson,CanadianBarReview(1990),626.ThedistinctionbetweenthepublicandprivatefunctionsisclearlyexpressedinPolasky(1954)(n.106),219-220.163[1927]PCIJ(ser.A),No.13,23.164 As we will see below, Anzilotti’s assumption is today (at least partially) wrong, due to thecircumstance that several systems of law do not apply a rigid and formal triple identity test. Thisapproachhasalsobeenfollowedbysomeinternationaltribunals.165This approach is shared by Wehland (2013) (n. 78), 127, 185 and ss.; Kuhn, Journal of WorldInvestment and Trade (2004), 7 and ss.; Bernhardt, The Statute of the International Court of Justice(2012) 1239 and ss., examining in particular Art. 59 of the ICJ Statute. See also the Trail SmelterArbitration (US v. Canada), Award of 11March 1941, 3 UNRIAA, 1952;Biloune v. Ghana, UNCITRAL,AwardonJurisdictionandLiabilityof27October1989,95ILR222(1994);GuyanaBoundaryArbitration(Brazilv.GreatBritain),Awardof6June1904,11UNRIAA22;ContinentalShelf,ApplicationbyMaltaforPermission to Intervene (Tunisia v. Libya), ICJ Rep (1981), 20. However, see Ottolenghi, Prows, PaceInternationalLawReview(2009),50andss.,whostatedthattheICJGenocidecaserepresentsamore

139

also in light of thewording of international rules allegedly referring only to the resjudicataeffectontheparties (suchasArt.59ofthe ICJStatuteandArt.53(1)oftheICSIDConvention).166Suchastrictapplicationhasbeenmainly justifiedonthebasisoftheprincipleofdueprocess,accordingtowhichallpartiesshallhaveafullandfairopportunitytopresenttheircasewithregardtoeverysinglelegalquestiontheywanttodiscussbeforea judge.167Thismeans that,even if theparties, theobjectand thelegalgroundofaprocessaresubstantially identical, theyarenotconsideredabletosatisfy the triple identity test if theyarenotperfectly identicalalso fromthe formalpointofview. Theformalapproachbasedonastrictapplicationofthetriple identitytest isperfectlyexpressedbythedecisions intheLauder168andCME169cases. Intheformercase,RonaldS.Lauder,theultimatecontrollingshareholderofagroupofcompaniesholding an investment in Czech Republic, initiated an UNCITRAL arbitration inLondonagainstthehostStateundertheUS-CzechBIT,onthebasisoftheviolationofseveral standards of protection contained in such BIT, namely fair and equitabletreatment, full protection and security, the prohibition to impair investments byarbitraryanddiscriminatorymeasuresandtheprohibitionofindirectexpropriation.170Inthelattercase,arisingfromtheexactlysamefacts(i.e.anallegedexpropriationoftheinvestment),CME–aDutchcompanyandgroupsubsidiaryholdingthesharesinaCzech company which actually made the investment – started another UNCITRALarbitration, this time in Stockholm, on the basis of the Dutch-Czech BIT, whichcontained substantially identical standards of treatment. Both the tribunals upheldtheir jurisdiction, but they reached contradictory findings on the existence of anexpropriation. The London arbitration was concluded in favour of Czech Republic;arbitrators did not find violations of the relevant BIT. The Stockholm TribunalconcludedthattheCzechRepublicviolateditsobligationsundertheDutch-CzechBIT;

flexibleapplicationofthetripleidentitytest,tobewelcomedinlightoftheveryrigidpreviouscaselawoftheICJ.166Art.59oftheICJStatutesaysthat“[t]hedecisionoftheCourthasnobindingforceexceptbetweenthepartiesandinrespectofthatparticularcase”.Similarly,Art.53(1)oftheICSIDConventionsaysthat“[t]he award shall be binding on the parties and shall not be subject to any appeal or to any otherremedyexcept thoseprovided for in thisConvention.Eachparty shall abidebyandcomplywith theterms of the award except to the extent that enforcement shall have been stayed pursuant to therelevantprovisionsof thisConvention”.With regard toArt. 59of the ICJStatute, it shouldbenotedthatithasbeeninterpretedbysomescholarsasanexclusionotheapplicabilityofthestaredecisisrule,ratherthanalimitationofthescopeofapplicationofresjudicata.SeeApotexHoldingsInc.andApotexInc.v.UnitedStatesofAmerica, ICSIDCaseNo.ARB(AF)/12/1,Award,25August2014,paras.7.6and7.7,referring,interalia,totheworkofProf.ShabtaiRosenneandJudgeManleyO.Hudson.167See Brekoulakis, The American Review of International Arbitration (2005), 9. Concerning theprinciple of due process, see Schwebel, Lahne, Comparative Arbitration Practice and Public Policy inArbitration,ICCACongressSeriesVol.3(1987),205andss.,Kurkela,JournalofInternationalArbitration(2004),221andss.,Pörnbacher,Dolgorukow,AnnalFLB-BelgradeLawReview50(2013),50andss.,Wirtz, The Arbitrator and the Parties, Proceedings of the Eleventh Annual Meeting of the NationalAcademyofArbitrators(1958),1andss.168RonaldS.Lauderv.CzechRepublic,UNCITRAL,FinalAward,3September2001.169CMEv.CzechRepublic,UNCITRAL,FinalAward14March2003.170AdetaileddescriptionofthefactualbackgroundmaybefoundinHober(2013)(n.64),345-348.

140

theTribunal,atpar.432,expresslystatedthat“thepartiesintheLondonArbitrationdifferfromthepartiesinthisarbitration”andthat“thetwoarbitrationsarebasedondiffering bilateral investment treaties, which grant comparable investmentprotection,which,however, isnot identical”.Furthermore, theTribunal,atpar.412,stated that “therewillbe twoawardson thesamesubjectwhichmaybeconsistentwith each other ormay differ. Should two different Treaties grant remedies to therespective claimants deriving from the same facts and circumstances, this does notdeprive one of the claimants of jurisdiction, if jurisdiction is granted under therespective treaty”. This award was further challenged before the SVEA Court ofAppeal in Stockholm171(the competent court at the seat), but the court upheld theawardandrefusedtoaccepttheallegationsrelatedto lispendensandres judicata ininvestmentarbitrationfiledbytheCzechRepubliconthebasisofarigidapplicationofthetripleidentitytest. Theresultofthetwoparallelproceedings intheLauderandCMEcases istheantithesisoflegalcertaintyandfinality,aswellasthefullnegationofthegoalsofanarbitral process (and of any form of dispute settlement) aimed at finally settling adisputeandstabilizingalegalrelationship.Indeed,AugustReinischhastalkedabout“theultimatefiascoininvestmentarbitration”(emphasisadded).172 Theprevalenceofformalitiesonsubstancehasalsoattractedseverecriticismfrom scholars,173some of them in fact arrived also to put in discussion the samelegitimacyofinvestmentarbitration.174

Havingsaidtheabove,forthesakeofcompletenessitisworthnotingthat,inaddition to the triple identity test it has very often been required that, for theapplication of res judicata, the two competing decisionsmust arise from the samelegal order, i.e. it is not possible for a national judgment to be res judicata ininternationalproceedingsandviceversa.175 The next paragraphs will analyse cases and opinions related to a broaderapplication of the triple identity test and try to find a legal justification for such abroaderapproach.176Wewillstartdealingwiththeobjectiveprongofresjudicata(i.e.petitum and causa petendi) and thenmove to an analysis of the requirementof thesameparties.Finally,wewillalsobrieflyanalysewhethertheidentityoflegalorderisactuallyrequiredinordertoresjudicataapply.

3.6.3 The requirements of petitum and causa petendi and the call for amoreflexibleapproach.TheSouthernBluefinTunacase

171CaseT8735-01,judgment,15May2003.172Reinisch,InternationalLawBetweenUniversalismandFragmentation:FestschriftinHonourofGerhardHafner(2008),116.173See,inparticular,Carver,JournalofWorldInvestmentandTrade(2004),23andss.,whohastalkedabouta“totallyunacceptableresult”.174SeeVanHarten,Malysheuski,OsgoodeLegalStudiesResearchPaperNo.14(2016),5andss.175SeeHober(2013)(n.64),311andss.176AcallforabroaderapproachmaybefoundinBrown,(2011)(n.139),5-6.

141

As we have seen in the previous Paragraph, the strict application of the

requiredobjectiveidentity(i.e.petitumandcausapetendi)oftwoparallelarbitrationsmay involve the risk of claim splitting. The claimant might want to avoid “the resjudicataeffectofapriorawardbyseekingadifferentsortofrelieforbyraisingnewgroundsinsupportofthesameclaimforrelief”.177

However,asnotedbySchreuerandReinisch,178“[i]nternationaltribunalshavealsobeenawareoftheriskthatiftheyusetoorestrictivecriteriaofidentityof“object”and “grounds, the doctrine of res judicata would rarely apply; if only an exactlyidenticalreliefsought(object)basedonexactlythesamelegalarguments(grounds)inasecondcasewouldbeprecludedasaresultofresjudicata,thenlitigantscouldeasilyevadethisbyslightlymodifyingeitherthereliefrequestedorthegroundsreliedupon.(…)Thiswouldbethecase, for instance, if inatypical investmentdispute, involvingallegationsof acts amounting toexpropriation, the investor first sought restitutio inintegrumasrelieffromthehostStateandinalaterlitigationchangedthe“object”ofhis case to requesting compensation”. Indeed, the already mentioned policyarguments (i.e. finality, reliability of the system of justice and judicial economy)stronglymilitateagainstclaimsplitting.

Thereareseveralinternationaldecisionsthatapplyalessstrictapproachtotherequirementofidentityofpetitumandcausapetendi.

Startingfromthefirstofsuchrequirements,itis,firstofall,worthmentioningthe Delgado andMachado cases.179In the former of them,180a claim for damagesagainstSpainforseizureofpropertyinCubawasbroughtbeforeaUS-SpanishClaimsCommission.An umpire denied such a request. The samedisputewas then re-filedunder the labelof “claimfor thevalueof thepropertyseized”.ThedefendantStateaskedtodismisstheclaimongroundsofresjudicata,arguingthat“thetestofidentity[is]notwhetherthemeasureofreliefdemanded,butwhethertheinjurythatformedthefoundationoftheclaim[is]thesameinbothcases”.Theumpirestatedthattheidentityofobjectwastobeanalysedonthebasisof“whethernewtightsareassertedin[thesecond]claimandthenstatedthat“[e]veniftheclaimantdidnotatthetimeofthe former case ask indemnity of the commission of the value of the lands, theclaimanthadthesamepowertodosoasotherclaimantsinothercaseswhereithasbeendone,andhecannothavereliefbyanewclaimbeforeanewumpire”.Similarly,in theMachado case,181in a first arbitration damages arising from the seizure of ahousewereclaimedand, inasecondarbitration, restorationof thehouseaswellas

177Dodge,HastingsInternational&ComparativeLawReview(2000),366.178(2002)(n.153),16.179The factual description of these cases is based on what has been written by Schreuer, Reinisch(2002)(n.153),17-18.180DelgadoCase,inMoore,InternationalArbitrationstowhichtheUnitedStatesHasBeenaParty2196(Spanish–USClaimsCommission1881).181MachadoCase,inMoore,InternationalArbitrationstowhichtheUnitedStatesHasBeenaParty2193(Spanish–USClaimsCommission1881).

142

rentanddamagesfor itsdetentionwereclaimed.TheUmpiredismissedthesecondclaimonthebasisofresjudicata,statingthat“thequestionwhetherthisclaimNo.129isanewone,orthesameasNo.3,doesnotdependuponwhethertheitemsincludedbethesameinbothclaims,butthatthetest iswhetherbothclaimsarefoundedonthesameinjury;thattheonlyinjuryonwhichclaimNo.129isfoundedistheseizureofacertainhouse;thatthissameinjurywasallegedasoneofthefoundationsforclaimNo.3,andthatinconsequenceclaimNo.129,asbeingpartofanoldclaim,cannotbepresentedasanewclaimunderanewnumber”.

Suchanapproach,aimedatdefiningtheobjectoftheclaimfunctionallyratherthananalytically,hasbeenfosteredincommonlawlegalsystems182and,also,bycivillaw courts, such as the Italian Corte di Cassazione, according to which in cases ofinternationalconflictsofjurisdictiontheruleofidentityofpetitumshallbeseenfromtheperspectiveoftheidentityofthepracticalresultswhichtheclaimantaimtoreachand not from the limited perspective of the rule which is allegedly violated by thedefendant.183

Movingtotherequirementoftheidentityofcausapetendi,sucharequirementcouldbeusedinordertosplitclaims,“forexample,whenapartyseekscompensationforexpropriation,inonecase,undercustomaryinternationallaw,inanother,underaBIT, or where a party bases its claim, in one case, on amultilateral agreement, inanotheronabilateraloneorontwodifferentBITSsuchas in the [CMEandLauder]case[s]. Technically speaking in such a situation the “cause”, “ground” or “causapetendi” isnon-identicalwhichwouldseemtoexcludeapplicationoftheres judicataprinciple. It is evident, however, that this is a highly artificial distinction since in allcasesmentioned the legalgrounds for the compensation soughtwouldbea ruleofinternational law calling for compensation for expropriation contained in customorexpressed in a treaty. It is far more appropriate to look at the specific rules and toexamine how far they are substantively identical or different. If it is the same rulereflectedindifferentlegalinstrumentsthisshouldnotcastanydoubtontheidentityof the “cause” and thus of the subject matter of the disputes. Under moderninternational law, it is common that acts and omissions of States (or otherinternational actors) may be subject to more than one treaty instrument, andthereforemorethanonedisputesettlementmechanism.(…)Consequently,adoptionof the position that parallel sets of litigation based on substantially identicalprovisionsfoundindifferentinstrumentsdonotcompetewitheachother,wouldtend

182Casad,Clermont(2001)(n.98),66.SeealsoScott,HarvardLawReview(1942),24.Aclearexampleofflexibleapproachtoidentityofcausaepetendi incommonlawisDavisv.USSteelSupply,688F.2d166,171(3dCir.1982),inwhichtheCourtstatedthatresjudicatarequires“essentialsimilarity[in]theunderlying events giving rise to the various legal claims”, even if the claims arise from differentstatutoryorcommonlawgrounds.183 See Italian Corte di Cassazione, Plenary Session, 12208/2012. See also Corte di Cassazione11532/2009 and 11185/2007. In this last decision, theCorte di Cassazionehas stated thatall disputesarisingfromthesamejuridicalrelationshiparetobeconsideredashavingthesamecauseofaction.

143

topromotemultiplicityofproceedings,andmightalsoresult inconflictingdecisionsconcerningtheState’sinternationalrightsandobligations”(emphasisadded).184

Suchanapproach,thathasbeendefinedas“substantive-transactional”,185hasbeen applied by the International Tribunal for the Law of the Sea in the SouthernBluefinTunaCase,186inwhichtheTribunalhadtodeterminewhetheradisputeontheJapanese fishing practices was to be settled according to the Convention for theConservationofSouthernBluefinTune (CCSBT)or according to theUnitedNationsConventionontheLawoftheSea(UNCLOS).TheTribunalheldthat“thePartiestothis dispute (…) are the sameParties grappling notwith two separate disputes butwithwhat in fact isasingledisputearisingunderbothConventions.To find that, inthiscase,thereisadisputeactuallyarisingunderUNCLOSwhichisdistinctfromthedisputethataroseundertheCCHBTwouldbeartificial”.Asaconsequence“adisputemay be considered as a single identical dispute based on identical grounds whereclaimsarebasedontwofairlydifferenttreatiesaslongastheyallrelatetothesamefactualbackground.Argumentoaminore,thisprincipleappliesevenmorewheretwoseparate treaties contain essentially identical provisions”.187This approach,which isaccepted by several scholars,188is confirmed also by certain human rights organs,whichhaveconsidered that the samecausapetendi has tobesubstantially (andnotformally)analysedonthebasisofthesameeventsandfactsandnotonthebasisofthe rule whose application is recalled by the claimant.189 In all these cases ofsubstantiallyidenticalclaims,thesecondactionhasbeendeclaredinadmissiblebythesecond Court or Tribunal, even if such a Court or Tribunal had a validly conferredjurisdiction.

All the above is very relevant in investment arbitration. Taking as a point ofreference the CME and Lauder cases, it should be noted that in both these cases,arisingfromthesamefacts,thesubstantiallysamestandardsofprotectionhavebeeninvoked, in the latter case according to the Dutch-Czech BIT and in the formeraccording to the US-Czech BIT. Schreuer and Reinisch have defined these BITs asvirtuallyidenticalwithregardtothestandardofprotectionthattheyinvolve(suchasthedefinitionofinvestment,theMFNandnationaltreatmentclauses,theprohibition184Schreuer,Reinisch(2002)(n.153),18-19.185SeeMartinez-Fraga,Samra,NorthwesternJournalofInternationalLawandBusiness(2012),438andss.186(AustraliaandNewZealandv.Japan),AwardonJurisdictionandAdmissibility,4August2000,39ILM1359 (2000). SeeVirzo, Il regolamento delle controversie nel diritto delmare: rapporti tra procedimenti(2008),243-244.187SeeSchreuer,Reinisch(2002)(n.153),20.188See,interalia,Lowe(1999)(n.132),202.189 See Glaziou v. France, UN Human Rights Commission 452/1991, Decision of 18 July 1994,CCPR/C/51/D/452/1991, 6. See also Trébutien v. France, UN Human Rights Commission 421/1990,Decision of 18 July 1994, CCPR/C/51/D/421/1990, 7. In both cases the UNHuman Rights Committeedeclaredthecomplaints inadmissiblebecause it foundthatthesame issuehadalreadybeenbroughtbefore theEuropeanCommissionofHumanRights.SeealsoUNHumanRightsCommission,Rogl v.Germany, 808/1998, Decision of 25 October 2000, CCPR/C/70/D/808/1998. The same approach hasbeenassumedbytheEuropeanCommissionofHumanRights,Application16717/90,Paugerv.Austria,DecisiononAdmissibility,9January1995.

144

of expropriations not executed according to international law standards, fair andequitable treatment and full protection and security) and, as a consequence,wouldhaveallowedanapplicationofresjudicatatobarthesecondclaim.190

Indeed, the argument of the substantial equivalence of the standards ofprotectionintheBITsisfosteredbytheconsiderationsthatsuchstandardsareusuallydrafted in a very generic way 191 and that, therefore, they have assumed anautonomous standing in international investment law192and are to be considereddetached them from the wording of the single BIT. It is very difficult (i.e. almostimpossible) to find an investment arbitration tribunal referring to “the fair andequitable treatment as set forth in BIT X” and not only to the “fair and equitabletreatmentofforeigninvestment”.Thisisbecause,asithasbeendemonstrated,193wehavetodayageneralprincipleof international investment law,namelythe“fairandequitable treatment of foreign investment”, which is applied autonomously andusuallyregardlessofthewordingofthesingleBIT.Thesamecouldbesaidwithregardto the other standards of treatment of foreign investments. Indeed, as stated bySchill 194 (and confirmed by Pellet), 195 “the core legal concepts of internationalinvestment law (…)only assumeamore concretizedmeaningover timebecauseoftheinterpretationinvestmenttreatytribunalsgivetothemintheirdecisions”.

TheaboveapproachisconfirmedbytheapproachthathasbeenappliedbytheCourtofJusticeoftheEuropeanUnion,which,accordingtotheprovisionofArt.29ofEU Regulation 1215/2012, has had to ascertain whether formally different, butsubstantially identical, claims had the same cause of action (i.e. both petitum andcausa petendi). In Gubisch Maschinenfabrik v. Palumbo,196the Court had to statewhether two actions, one asking to enforce a contract and the second seeking therescissionofthesamecontract,werebasedonthesamecauseofaction.TheCourtstated that “it isapparent that theaction toenforce thecontract isaimedatgivingeffect to it, and that the action for its rescission or discharge is aimed precisely atdeprivingitofanyeffect.Thequestionwhetherthecontractisbindingthereforeliesattheheartofthetwoactions.(…)Inthoseproceduralcircumstancesitmustbeheld

190SchreuerandReinisch(2002)(n.153),31-32.191Letustake,asanexample,theprovisionsofthealreadymentionedUS-CzechBITandDutch-CzechBIT.The former, atArt. II, para2(a), states that “[i]nvestment shall at all timesbeaccorded fair andequitabletreatment,shallenjoyfullprotectionandsecurityandshallinnocasebeaccordertreatmentlessthanthatrequiredbyinternationallaw”.Thelatter,atArt.3,statesthat“[e]achContractingPartyshall ensure fair and equitable treatment to the investors of the other Contracting Party (…) eachContractingParty shall accord to such investments full security andprotection (…) If (…) obligationsunderinternationallawexistingatpresentorestablishedhereafter(…)containrules,whethergeneralor specific, entitling investments by investors of the other Contracting Party to a treatment morefavourablethanisprovidedforbythepresentAgreement,suchrulesshalltotheextentthattheyaremorefavourableprevailoverthepresentAgreement”.192SeePalombino(2012)(n.60),58andss.SeealsoDiBenedetto,(2013)(n.61),17and36-37and103andss.193Palombino(2012)(n.60),58andss.194Schill,GermanLawJournal(2011),1092.195Pellet,ICSIDReviewFILJ(2013),228.196CaseC-144/86,[1987]ECR4861.

145

that the two actions have the same subject-matter, for that concept cannot berestricted so as to mean two claims which are entirely identical”.197This has beenfurther confirmed in theOverseas case, in which the CJEU stated that the rule onidentity of subject matter shall be interpreted broadly, in order to encompass thebroader possible spectrumof situations.198Such an approach has been base on theéffét utile doctrine, according towhich a rule has to be interpreted in awaywhichallowstoreachthescopeforwhichsuchrulehasbeendrafted.199

Similarly,intheUS,aso-called“pragmaticstandard”hasbeenadoptedanditisnowusuallyrequiredanidentityof“transaction”ratherthan“causeofaction”.200

It seems, in conclusion, completely unreasonable to consider two claims ashaving different causae petendi only because the sources under which the samestandardisinvokedareformallydifferent.201

3.6.4 The requirement of identical parties: the effects of international awards

onrelatedthirdpartiesThe traditional approach, according to which res judicata has effect only

betweentheformalpartiesofaprocess,failstokeepintoaccountthecircumstancethatadispute,ifseeninitsintegrity,isoftenmorecomplexthanhowitisfiledbeforeaTribunal.Forexample,ifweconsideradisputeinvolvingacompany(whichispartofagroup)andaState, it isstronglyarguablethatsuchadisputeactually involves,ontheoneside,thewholegroup–tobeintendedasacentreofinterests–(andnotonlythe single company who filed the claim) and, on the other side, the State.Furthermore, the traditional approach fails to consider that a legal relationship isoftenpartofabundleof legalrelationshipswhich influenceeachother; it isactuallyimpossible to say that a legal relationship is not conditioned by the other legalrelationships with which it is inextricably interrelated.202As stated by Rudolf vonJhering,thelegalworldbehaveslikethebiologicalworld:whenacertaincircumstance(e.g.anaward)modifiesalegalrelationship,it(voluntarilyorinvoluntarily)haseffectson other legal relationships, i.e. on the rights of certain third parties, whose legalsphere will be directly or indirectly modified. 203 This very simple cause-effectrelationship,which isdictatedfirstofallbyrulesof logic, isessentialtoensure legalcertaintyandcoherenceinlegalrelationships.

197Paras.16-17.198OverseasUnionInsuranceLtdandDeutscheRuckUkReinsuranceLtdandPineTopInsuranceCompanyLtd v New Hampshire Insurance Company, Case C-351/89 [1991] ECR I-03317. See also Salerno,GiurisdizioneedefficaciadelledecisionistranierenelRegolamento(UE)n.1215/2012(rifusione)(2015),265andss.199SeeDumbrovsky,EffetUtile(2014),93andss.200SeeVolpino(2007)(n.91),119andss.and173.201Thisapproach(onlywithregardtocausapetendi)isacceptedalsobyWehland(2013)(n.78),192.202Liebman,Efficaciaedautoritàdellasentenza(1983),56andss.203vonJhering,DieReflexWirkungenoderdieRuckwirkung rechtlicherTatsachenaufdrittePersonen, inLiebman(1983)(n.202),61.

146

These assumptions should lead us to re-think the requirement of identity ofthepartiesininvestmentarbitration.Indeed,theeffectsofthestrictapplicationofthetripleidentitytest,thatwehaveseenintheCMEandLauderdecisions,istheperfectantithesisofwhatwehavejustsaid.

It is possible to identify two kind of interrelation between two legalrelationships(i.e.alegalrelationshipandtherightsofoneormorethirdparties):204(i)one of the two relationships is subordinated to the other, i.e. the third party’s (orparties’) rightsaresubordinatedtoa legal relationshipbecause theyarepartof (i.e.involved in) such relationship. Indeed, we could also say that the third party is anostensiblethirdparty,whichinfactisapartytotheprocess.205Thus,inthiscase,themodification of the first relationship involves a necessary modification of thesubordinated relationship(s);206and (ii) the two legal relationships are independentbut concurrent/parallel, i.e. due to the veryhighdegreeof identificationof the tworelationships (which might be indeed called analogous), the satisfaction of one ofthem is equalized to the satisfaction of all of them. In this last case, if for examplethereisanawardinvolvingoneoftheconcurrent/parallelrelationships,suchanawardimposesthatalltheconcurringlegalrelationshipscomplywithit.207

Inthesecases,bothasamatteroflogicandasaconsequenceoftheprincipleoflegalcertainty,adecisionofthefirstrelationshipshouldabsorbadiscussiononthesecond (subordinated or concurrent) relationship. The logical and impliedconsequence of the above discussion is that a judicial decision (both issued by anationaljudgeandbyaninternationalcourtortribunal)mayhavecertaineffects,thathavebeencalled “the reflectedeffectsof res judicata”,208on certain thirdparties.209

204Allorio(1935)(n.157),47andss.and118andss.205Carnelutti,Studididirittoprocessuale(1925),443.206Allorio(1935)(n.157),68.207Allorio(1935)(n.157),120.208Carnelutti, (1956) (n. 157), 79; Allorio (1935) (n. 157), 121. It is worth noting that the Author hasdistinguishedbetweenthereflectedeffectsofresjudicata,arisingwhenoneofthetworelationshipsissubordinatedtotheother,andtheenlargementofresjudicata,whichariseswhenthetworelationshipsareconcurrent.InAllorio’sopinion,whilethereflectedeffectsare ipsofactodeduciblebythelaw,thesame cannot be said with regard to the enlargement of res judicata, which should be expresslyauthorizedbythelaw.IntheopinionofthepresentAuthor,suchdistinctionisextremelytechnicalandperhapsartificialfortheaimofthepresentbook,duetothelackofanylegalreferencetobothofsucheffectsininternationallaw.Hence,inordertoavoidanyconfusion,wewillonlytalkaboutthereflectedeffectsofresjudicata.SeveraldecisionsoftheItalianCortediCassazionehavereferredtothereflectedeffects(tobeintendedaccordingtoAllorio’sdefinition)ofresjudicata.Thesedecisions,whichanywayrepresentaminority,havemotivatedthisapproachonthebasisofthefactthateveryjudicialdecisionshall be intended as an objective affirmation of the truth and therefore the legal effects a decisioncannot be put in discussion by a subsequent decision. See decisions no. 2137/2014, 10989/2013,19946/2004.209TheideaoftheeffectsofresjudicataonthirdpartieswasfirstlydevelopedbyBetti,Trattatodeilimitisoggettivi della cosa giudicata in diritto romano, 8 and ss., andhas further been theobject of a hugediscussionbetween Italianscholars.See interalia,Luiso,Principiodelcontraddittorioedefficaciadellasentenza verso terzi (1981), 63 and ss., Proto Pisani,Opposizione di terzo ordinaria (1965), 35 and ss.Therehavebeenseveralpointsofdiscussion.Inparticular,certainAuthorshavedistinguishedbetweentheeffectsofthedecisionandtheeffectsoftheresjudicata,whileothershavesaidthattheeffectsonthirdpartiesareonlydefactoandnotdejure.See,ingeneralterms,Chizzini,L’interventoadesivo,vol.2

147

Thecommonlawworldreferstosuchthirdpartiesas“privies”,i.e.“peoplewhowerenonpartiestoanactionbutwhoincertaincircumstancesareneverthelesssubjecttogenerally the same rules of res judicata as are the former parties, the basis for thistreatmentbeing some sort of representational relationshipbetween a former partyand thenonparty”.210Adistinction isusuallymadebetween substantiveprivityandproceduralprivity. In the formercase, “privies includepersonswhohaveorhadanyone of a wide variety of substantive legal relationships with a party, when thatrelationship in a sense created a representative role”;211in order to address theexistence of substantive privity, i.e. an identity of interests, a factual and concretedetermination is required.212Procedural privity regards “persons who were actuallyrepresentedinthelitigationbyaparty,thusincludingbeneficiariesrepresentedbyatrustee”.213Inthisbookwewillreferonlytosubstantiveprivity.

What we have just stated is perfectly compliant with the function of theprocess: if the process is the instrument to settle a dispute and to stabilize one ormoreaspect(s)ofalegalrelationship(tobeintendedinitsintegrity),theeffectsofajudicialdecisionshallnecessarilyhaveascopeofapplicationwhichisbroaderthanthesingle process and extend to the entire legal relationship, i.e. referring also toprivies.214Suchthirdpartyeffectsbeenalready(partially)confirmedwithregardtoICJdecisions, which have been considered by someAuthors as having effects on thirdparties.215

It is here submitted that arbitral awardsmay have effects on privies also ininternational investment arbitration, regardless of the principle of party autonomy:

(1991),581andss.,andZucconiGalliFonseca,Laconvenzionearbitralerispettoaiterzi(2004),686andss. See contra the above mentioned approach Balena, Il giusto processo civile (2009), 35 and ss.,Cavallini, Rivista di diritto processuale (2007), 1221 and ss. The German position regarding theextensionof res judicata on thirdpartieshasbeenanalysedbyTrocker,Rivistadi dirittoprocessuale(1989),36andss.210Casad,Clermont (2001) (n. 98), 149. The termhas been also definedbyVestal, IowaLawReview(1968),2,sayingthat“thereis(…)alonghistoryofdecisionswhereaplaintiff,notapartytoonesuit,hasbeenheldprecludedinanactionagainstapartytothefirstsuit.Veryearlyinthedevelopmentofres judicata itwas held that a plaintiff, under some circumstances,would not be allowed to recoverbecause of an earlier suit in which another plaintiff was defeated. The courts, in reaching thisconclusion, relied on a significant relationship between the losing plaintiff in Suit I and the plaintiffattemptingrecoveryinSuitII.Privitywasthelabelattachedtothisrelationship”.211Casad,Clermont(2001)(n.98),153.212SeeBattlev.Cherry,339F.Supp.186(N.D.Ga.1972),andCraneBoomLifeGuardCo.v.Saf-T-BoomCorp.,362F.2d317(8thCir.1966).SeealsoVestal,SouthernCaliforniaLawReview(1974),361,Morris,CaliforniaLawReview(1968),1101.213Casad,Clermont(2001)(n.98),159.214Carnelutti,(1956)(n.157),79.215SeeForlati,Rivistadidirittointernazionale(2002),105andss.TheAuthoralsorecallswhathasbeenstatedbyNigeriaintheCameroonv.NigeriaCase,ICJRep1998,323,par.113:“byvirtueofarticle59oftheStatute,thirdStatesarenotformallyboundbydecisionsoftheCourt;(…)nevertheless(…)Article59 of the Statute gives insufficient protection, since in specific situations, in spite of that Article,decisionsoftheCourtmayhaveclearanddirect legalandpracticaleffectsonthirdStates”. SeealsoForlati, The International Court of Justice: An Arbitral Tribunal or a Judicial Body (2014), 200-201,Palchetti,MaxPlanckUNYB(2002),140,Bonafè(2014)(n.158),15and59-60,andAl-Qahtani,TheLawandPracticeofInternationalCourtsandTribunals(2003),273andss.

148

the effects of an award arede jure andde facto extensible to all subordinated andconcurrentrelationships.Thisideahasbeenalreadysupportedinthecaselaw216andbysomeAuthors,whohavenotedthat,oncetheaward is issued,all theother legalrelationshipwhichinsomewaydependfromsuchawardshallcomplywithit;217ithasbeen said that, if such an approach is not followed, an arbitral award would beequalized toa legalopinion218or toa contract.219Indeed, it isundeniable that, fromtheperspectiveof its function,arbitration isaimedatsettlingadispute(asawhole)andtogivingstabilityto legalrelationshipswhich itdecides.Arbitration istherefore(andobviously)at thedisposalof theparties,but theeffectsof theawardare tobenecessarily intended as going beyond the intention of the parties: otherwisearbitrationcouldbealsointentionallyusedbythepartiestoabuseoftheirproceduralrights,asithappenedintheCMEandLaudercases.

Indeed,suchanapproach,thatSchreuerandReinischhavedefined“economicapproach”,220hasfoundseveralapplicationsininternational law,EUlawand(evenifonlyindirectly)ininvestmentarbitration.221

With regard to international law, it is worthmentioning theMartin v. Spaincase,222inwhichtheEuropeanCommissionofHumanRightshassupportedtheideathat “a claimby 23Union activists, presented in their personal capacity,whichwasidenticalinitsobjectandscopetoapreviousclaimbroughtbeforetheILOCommitteeon Freedom of Association by the trade organization to which the applicantsbelonged,wasprecluded”byvirtueofArt.35(2)(b)oftheECHR.Anotherstatementproviding for third parties effect of res judicata can be found in the ICJLighthousescase, where – in a case regarding the interpretation of a multilateral treaty – the

216See FrenchCour deCassation,Prodim v.Distribution Casino France, 23 January 2007, in Revue del’Arbitrage (2007), 135. Other cases are mentioned in Gunes, Transnational Dispute Management(2015),18,footnote174.217Ricci, Rivista di diritto processuale (1989), 666. Id., Rivista trimestrale di diritto e procedura civile(2003),517-518.SuchanapproachhasbeenalsoapprovedbyRuffini,Rivistadell’arbitrato(1995),648.SeealsoFazzalari,Rivistadell’arbitrato(1995),619-620,SeeZucconiGalliFonseca(2004)(n.209),681and ss. The issue has been generally analysed by Lotbiniére McDougall, Transnational DisputeManagement(2012),1andss.218Ricci,Rivistadidirittoprocessuale(1989)(n.217),669.219Theequalizationofarbitralawardstocontractisnotnewinscholars’opinion.SeeSchell,UCLALawReview(1988),662andss.,Motomura,TulaneLawReview(1988),80andss.SeealsoVandenbergv.SuperiorCourt, 982P.2d229 (Cal. 1999).SuchadecisionhasbeencriticizedbyCromwell, JournalofDisputeResolution(2000),425andss.220Schreuer,Reinisch(2002)(n.153),10andss.Manyofthecasesreportedbelowhavebeenreadbythepresentauthorinsuchlegalopinion.221Withregardto internationalcommercialarbitration,wehavealreadymentioned, inChapter2,theso-called “group of companies doctrine”, according to which if a number of companies represent asingle economic unit, they can be considered as all bound by the jurisdiction of the arbitral tribunalevenifonlyoneofthemhassignedthearbitrationclause.AccordingtoSchreuerandReinisch(2002)(n.153),10,suchadoctrinecouldbeseenalsofromtheperspectiveofthearbitralaward:inpresenceofagroupofcompanies,anawardregardingonlyoneofthemextendsalsototheothercompaniesofthegroup.222 European Commission of Human Rights, Application 16358/90, Decision on Admissibility, 12October1992.

149

judgesstatedthat“[t]heresjudicataextends(…)beyondthestrictlimitsofthecasedecided”.223

In EU law, the opinion that “the fact that a subsidiary has a separate legalpersonality is not sufficient toexclude thepossibilityof imputing its conduct to theparentcompany”hasfirstlybeenpointedoutintheDyestuffsCase,224inwhichitwassaid that, if thesubsidiary“doesnotdecide independentlyupon itsownconductonthemarket,butcarriesout,inallmaterialrespects,theinstructionsgiventoitbytheparent company”, such a parent company can be considered involved in thetransactionand,therefore,boundbythesubsequentaward.ThesameapproachhasbeenassumedintheContinentalCancase.225

Finally,withregardtoinvestmentarbitration,aswehavealreadyobservedinChapter 1, Paragraph [-], arbitral tribunals have several times extended theirjurisdictiontoothercompaniesofthesamegroup,bystatingthatthiswasnecessaryin order to protect the investor. This is clearly represented by one of the very firstICSID decisions, the Amco v. Indonesia Decision on Jurisdiction,226in which theTribunal stated that “the foreign investorwasAmcoAsia [i.e. theparentcompany]:PT Amco [i.e. the subsidiary throughwhich the investmentwasmade] was but aninstrumentalitythroughwhichAmcoAsia[realized]theinvestment.Now,thegoalofthearbitrationclausewastoprotecttheinvestor.Howcouldsuchprotectionbeensured,ifAmcoAsiawouldberefusedthebenefitoftheclause?”(emphasisadded).

It is not understandablewhy a similar approach has not been assumedwithregardtoresjudicata.Indeed,itcouldbesaidthatthegoalofinvestmentarbitrationisto ensure that certain standards of protection are granted to investors. Suchstandardscanbeviolatedonlyoncebythesamefacts.Howcouldabusesbeavoidedif the principle of res judicata is not interpreted in the same broad way in whichtribunalshaveinterpretedarbitrationclausescontainedinBITs?

Asalreadysaid, themain reasonwhichshouldallegedly justifysucha formalapproachistherespectoftheprincipleofdueprocess.However,itissubmittedthattherespect/violationoftheprincipleofdueprocessshallbeascertainedonacase-by-casebasisanditisnotpossibletoexcludeapriorithepossibilityofanextensionofresjudicataonthirdparties. Indeed, if it isascertainedthataparty, tobe intendedasasinglecentreof interest,hashadthefullandfairopportunitytopresent itscase,wecannotseewhysuchapartyshouldhavethepossibilitytodosoasecondtimejustbychangingthelabelofthelegalentitywhofilestheclaim.227Thisistheapproachtaken

223Lighthouses(Francev.Greece),23ILR(1956),86-87.SeeAl-Qahtani,(2003)(n.215),273andss.224CaseC-48/69,ICIv.Commission(DyestuffsCase)[1972]ECR619,par.133.225CaseC-6/72,EuropemballageandContinentalCanv.Commission[1973]ECR215,par.15.226ICSIDCaseNo.ARB/81/1,DecisiononJurisdiction,25September1983,p.400.227SeeCasad,Clermont(2001) (n.98),150,statingthat“dueprocessallowsbindingmanymorenon-parties than most persons assume. After all, the loose demands of due process explain how thelegislature and administrators can bind people and their property,when those people have receivedrepresentationonlyintheloosestsense.Analogously,acourt’sjudgmentcouldbind,amongothers,allsimilarly situated persons whose interests received adequate representation, binding them not only

150

bytheRestatement2ndofJudgments,par.39ofwhichstatesthat“[a]personwhoisnotapartytoanactionbutwhocontrolsorsubstantiallyparticipatesinthecontrolofthepresentationonbehalfofapartyisboundbythedeterminationofissuesdecidedas though he were a party”, provided that he had the full and fair opportunity topresent its claim.228Hence, it is possible to say that it is true that each substantiveparty shall have the full and fair opportunity topresent its case,but the conceptof“party” shallbe intended in thesubstantial senseand, therefore, the respectofdueprocessshallbeascertainedinconcretoandnotonlyinabstracto.229

ThisapproachhasbeenalsoconfirmedbytheUSSupremeCourt,whichstatedthat the controlling question iswhether it canbe said that “theprocedure adoptedfairlyinsurestheprotectionoftheinterestsofabsentpartieswhoaretobeboundbyit”.230In conclusion, if there is a strict relationshipbetweenoneof thepartiesandathirdpartysothatsuchathirdparty(privy)maybeconsideredrepresentedduringtheprocess, the third party will be precluded to newly file the same claim and, in theevent it should nevertheless file it, such a claim shall be declared inadmissible.231Itwould, indeed, be “unjust to permit one who has had his day in court to reopenidenticalissuesbymerelyswitchingadversaries”.232

Suchanapproach, supportedbyseveralauthoritativescholars,233wouldhaveleadtoconsiderasidenticalpartiesMr.LauderandCMEintheLauderandCMEcases,considering that all the decisions regarding CMEwere taken by its controlling andultimateshareholder,Mr.Lauder.

3.6.5 Thesamelegalorder(inbrief)

throughtheflexibledoctrineofstaredecisisasitdoesbutalsothroughthestricturesofresjudicataasitcould”.228The idea that the “community of interest” is the necessary requirement in order to extend resjudicataon thirdpartieshasbeenexpressedalsobyBrekoulakis (2005) (n.167), 11.According to thisAuthor,whentherightsof thirdpartiesare inextricably intertwinedwiththerightsofoneoftherealparty, the third party is in fact a false third party which will be affected by the arbitral award.Brekoulakistalksabout“arbitraleffect”.SuchanapproachhasbeenstronglyapprovedbyGunes(2015)(n.216),18andss.229AnevenmoreextremepositionagainstdueprocesshasbeentakenbyBone,NewYorkUniversityLawReview(1992),195andss.,accordingtowhom“thedayinthecourtisofteninvokedintalismanicfashiontoopposenon-partypreclusionwithoutanyexplanationofwhythevaluesunderlyingtheidealsupporttheresult”.AccordingtoBone,ifathirdpartyisvirtuallyrepresentedintheprocess(evenifnotin privitywith one of the parties), such a third party is precluded to start a new claim on the samedispute.However,thetheoryofvirtualrepresentationhasbeenrejectedin2008bytheSupremeCourtinTaylorv.Sturgell,553US880.230Hansberryv.Lee,311US32,42(1940).SeealsoVestal,MichiganLawReview(1963),49-51.231SeeMcFaddenv.McFadden,239Ore. 76,396P.2d202 (1964),204,where theCourt stated that itwas “satisfied that the first litigation provided substantial protection of the rights and interests of thepersonsoughttobebound”(emphasisadded).232Bernhardv.BankofAmericaNat.Trust&SavingsAssn.,122P.2d892(S.C.Cal.1942),894.SeealsoWatson(1990)(n.162),629-630.233See, interalia,Reinisch(2004)(n.64),44andss.,andShany,ssrn.com(2007),13-14,whoexpresslystated that theprivityof interest test ismore suitable to regulate casesof jurisdictional competitionbetween internationalarbitrationtribunals.SeealsoSpoorenberg,Vinuales,TheLawandPracticeofInternationalCourtsandTribunals(2009),99,RadicatidiBrozolo,ssrn.com(2011),10.

151

Asalreadyclarified,thisbookdoesnotdealwithcasesofparallelproceedings

betweennationalcourtsandinternationalarbitrationtribunals,butonlywithparallelproceedings involving two arbitration panels. For this reason, the identity of legalorder,whichisoftenposedasarequirementfortheapplicationofresjudicata,shouldnot be dealt with in this book, in light of the fact that it is assumed that twoinvestmentarbitrationtribunalsarepartofthesamelegalorder,namelyinternationallaw.

However,theAwardintheHelnanv.Egyptcase234requiresustodealwithsucha question, even if very briefly. In this case, prior to refer to ICSID arbitration, thepartieslitigatedbeforeanarbitraltribunalsittinginCairo.AftertheCairoarbitrationwas concluded and the award enforced in Cairo (according to the 1958 New YorkConvention), Helnan started another claim before ICSID. Egypt objected theadmissibilityoftheclaimstatingthattheCairoawardwasresjudicatawithregardtoallthemattersthathavebeenalreadydecided.TheICSIDTribunalrecognizedtheresjudicataforceoftheCairoaward,butalsostatedthattheresjudicataeffectcouldonlyextendwithin the legalorderwhere theawardwasenforced, i.e. theEgyptian legalsystem.Hence, theTribunal refused to recognize, in the frameworkof internationallaw,theresjudicataeffectoftheCairoaward.TheTribunalreasoningwasnotbasedonthecircumstancethat“an internationaltribunal isconsideredtobehierarchicallysuperior to any national court or private arbitral tribunal”235but on the fact that“althoughthesubjectmattermaybesubstantiallythesame,thecausesofactionaredifferent”.236Indeed, even if the Cairo award had res judicata within the legal orderwhere it belongs, it cannot have such an effect in another legal order, namelyinternational law. Hence, the ICSID Tribunal considered itself bound by the CairoAwardwith regard to thematter concerningEgyptianLaw,butnotwith regard theissuesofinternationallaw.237

234ICSIDCaseNo.ARB/05/19,Award,3July2008,paras.121andss.235ILA, Final Report on Lis Pendens and Arbitration, Toronto Conference, 2006, 13. This idea is alsofosteredbyWehland(2013)(n.78),136-137.236HelnanAward,par.124.237A similar approach has been approved also by Cremades in his dissenting opinion in Fraport AGFrankfurt Airport Services Worldwide v. Republic of the Philippines, Dissenting Opinion of BernardoCremades, 16August2007, 26and inGAMI Investments v.Mexico,UNCITRAL,Award, 15November2004,par.41.ThisisnottheonlyapproachfollowedbyTribunalsinanalysingtherelationshipbetweennational and international proceedings. As noted by Wehland (2013) (n. 78), 148 and ss., there areseveral international Tribunals which have considered national decisions as mere facts and havethereforefullyreviewedthenationaldecisions,suchasEmpresasLucchettiSAandLucchettiPeruSAv.TheRepublicofPeru,ICSIDCaseNo.ARB/03/4,DecisiononAnnulment,5September2007,par.87,andEDFInternationalSA,SaurInternationalSAandLeònParticipationesArgentinasSAv.ArgentineRepublic,ICSID Case No. ARB/03/23, Award, 11 June 2012, par. 1131. Finally, in other cases, the review ofdomestic decisions by international Tribunals has been considered to be limited to circumstance inwhich a denial of justice realized. See Robert Azinan, Kenneth Davitian & Ellen Baca v. The UnitedMexican State, ICSID Case No. ARB(AF)/97/2, Award, 1 November 1999, paras. 4-24 and 96-97 andMondev International Ltd v. United States of America, ICSID Case No. ARB(AF)/99/2, Award, 11October2002,par.126.

152

Theawardposesustwoquestions,particularlyrelevantforthecaseofparallelcontract and treaty claims: (i) is it correct to consider that there is no hierarchybetween national courts (and by non-ICSID arbitration panels) and internationaltribunals?And(ii)isitcorrecttostatethatthereisnointerrelationbetweenanationaldecision (or an arbitration award to be enforced according to the New YorkConvention)andaninvestmentarbitrationdecision?

With regard to the first question, it is here submitted that the approachassumedbytheHelnanTribunal is thecorrectone. Indeed, in lackofanynormativereference, thepresent author shares the viewofwho stated that a national and aninternational proceeding are, in principle, indifferent to each other.238If there is avalidly conferred jurisdiction they could indeedproceed in parallel: their exercise ofjurisdiction is not precluded. However, it is worth noting that it could well happenthat,bywayofadmissibility,thearbitraltribunalorthenationalcourtconsidersitselfprecludedfromhearingaquestionthathasbeenalreadydecidedby, respectively,anationalcourt(orcommercialarbitrationpanel)oraninternationaltribunal.

Concerningthesecondquestion,i.e.whetheranationaldecisioncan(not)haveany international influence and vice versa, the present Author shares the viewexpressedbyYuvalShany.239ThisAuthorstartsfromtheassumptionoftherejectionof what he calls the disintegrationist approach, according to which parallel claimsarising in national and international legal systems cannot overlap, and looks for anintegrationistapproach,whichseekstoharmonizeoverlappingnormsandproceduresandtoeffectivelyregulaterelatedclaims.Inlightofthisapproach,Shanymilitatesinfavourofabroadconstructionoftherequirementsforresjudicataandinfavourofthepossible international res judicata effects of national decisions (or arbitral decisionenforcedaccordingtotheNewYorkConvention).240

From this perspective, and also in light of the hybrid nature of investmentarbitration (which involves both elements of international and national law),241it isarguablethat–priortosaythatanationaldecision(oranawardissuedbyaanotherarbitration panel)may not preclude an action before an ICSID tribunal – a tribunalshouldbeverifiedwhether,inconcreto,theparties,thepetitumandthecausapetendisubstantiallycoincide.Ifthereissuchasubstantialcoincidence,itisarguablethatthesecond judge could consider the second claimprecludedbywayof adeclarationofinadmissibilityofthesameclaim.242

238SeePalombino,Gli effetti della sentenza internazionale nei giudizi interni (2008), 20.However, thesame Author, has demonstrated, at 151 and ss., that, in concreto, the international decision mayinfluenceinvariouswaysthenationalproceedings.239Shany(2006)(n.73),10andss.,id.(2007)(n.233),16andss.240SeePalombino (2008) (n. 238), 151and ss.,whohasdemonstratedhowandwhyan internationaldecisioncouldinfluenceanationaljudge.241SeeDouglas(2003)(n.55),151andss.242SeeDodge(2000)(n.177),359.ThisAuthorbaseshisopinionthatnationaldecisions(orarbitrationawards to be enforced according to the New York Convention) do not have res judicata effects ininternational proceedings on the circumstance that otherwise the rule of prior exhaustion of localremedies would loose its efficacy. It could be easily answered that the prior exhaustion of local

153

Theaboveopinionisconfirmedbyanothercircumstance.Asalreadyreported,theHelnanTribunaldidnot recognizetheeffectsof theCairoawardonthebasisofthefactthat,havingbeensuchanawardenforcedaccordingtotheprovisionsofthe1958 New York Convention, it was to be considered as part of the Egyptian legalorder.Ifsuchanapproachisconfirmed,thiswouldleadtotheabsurdresultthatevenanon-ICSIDinvestmentdecision(forexampleanUNCITRALdecision),tobeenforcedaccording to the New York Convention, could be bypassed by a subsequent ICSIDdecisionjustbecause,havingbeenenforcedaccordingtotheNewYorkConvention,ithas to be considered as part of a national legal order. This is what happened inBywater Gauff v. Tanzania, 243 where a contract claim was brought before anUNCITRAL Tribunal and, then, a treaty claim before the ICSID Tribunal. The ICSIDTribunal refused to decline jurisdiction stating that it was not influenced by thecontract claim, but nevertheless stated that the interpretation and application of theinvestmentcontractrepresentedanessentialelementintheperspectiveofitsfindingofBIT breaches. This positionmilitates against legal certainty and coherenceand shallthereforebefullyrefused.244

TheproposedapproachfindssupportintheRSMandGrynbergICSIDAward,245which will be deeply examined in the following Paragraph, where the TribunalconsideredthatapreviousdecisionbyanotherinvestmentTribunalofcertaincontractclaimsmaybe evaluated as a collateral estoppel in a subsequent treaty arbitration,provided that there is substantial identity between the two claims. The Tribunalexpressly rejected246the Claimant’s assertion that “breach of contract issues do[es]notdisposeofBITissuesbecauseapartymaybeincompliancewithaninternationalcontractbutstillrunafoulofaBIT”.247

Theonlyexceptiontowhatstatedaboveisthecaseinwhichthesametreatytextprovidesforthepriorexhaustionofthelocalremedies.Inthiscase,itisthesametreaty that allows the parties to bring a claim, already discussed before nationalcourts, before an international tribunal, therefore excludinga priori the res judicataeffectofthenationaldecision.

3.7 Collateralestoppel(issuepreclusion)3.7.1 Developmentandrequirementsofcollateralestoppel:Abroaderconcept

ofprivityandthenecessitytorespectdueprocess

remedies can be interpreted as an exception to the general rule which envisages the possibility ofpreclusionincasetheparties,theobjectandthelegalgroundsaresubstantiallythesame.243ICSIDCaseNo.ARB/05/22,Award,24July2008.244TheBywaterGauff decisionhasbeen, indeed, criticizedbySavarese,www.federalismi.it (2009),8and12.245Rachel S Grynberg, Stephen M Grynberg, Miriam Z Grynberg, and RSM Production Corporation vGrenada,ICSIDCaseNoARB/10/6,10December2010.246Seepar.7.1.3oftheAward.247Seepar.5.3.3oftheAward.

154

Collateral estoppel is a doctrine developed and applied in the common law

world,248whosegoalsarethesameofres judicata.249In1897,theUSSupremeCourtdescribedissuepreclusioninthisway:“aright,question,orfactdistinctlyputinissueanddirectlydeterminedbyacourtofcompetentjurisdiction(…)cannotbedisputedina subsequent suitbetween the samepartiesor theirprivies; andeven if the secondsuit is foradifferentcauseofaction, the right,questionor factoncesodeterminedmust, as between the same parties or their privies, be taken as conclusivelyestablished,solongasthejudgmentinthefirstsuitremainsunmodified.Thisgeneralrule is demanded by the very object for which civil courts have been established,whichistosecurethepeaceandreposeofsocietybysettlementofmatterscapableofjudicialdetermination.Itsenforcementisessentialtothemaintenanceofsocialorder;for theaidof judicial tribunalswouldnotbe invoked for thevindicationof rightsofpersonandproperty, if, asbetweenpartiesand theirprivies, conclusivenessdidnotattendthejudgmentsofsuchtribunals inrespectofallmattersproperlyput in issueandactuallydeterminedbythem”.250

This very old definition is still very actual and responds to the alreadymentionedpublicfunctionofanyprocess, i.e.todefinitelysettledisputes(or, inthiscase, issues), regardless of the formalities and labels of every single case. Indeed,regardlessofthecauseofactionofthetwosucceedingproceedings,“thedoctrineofcollateral estoppel precludes a party or its privy from relitigating any factual [andlegal] issue that has been “actually litigated” in a prior action and that have beennecessary to the resolution of that action. (…) The estopped party, however, mayoppose preclusion if it was not given a “full and fair” opportunity to litigate theparticularissueintheoriginalaction”.251

Thefollowingaretherequirementsfortheapplicationofcollateralestoppel:(i)the issuewhose discussion is precluded shall be the same in the two processes; (ii)suchanissueshallhavebeenactuallylitigated;(iii)suchissuehasbeenessentialtotheresolutionofthepriorcase;(iv)thepartiesshallbethesameor,atleast,inprivitywiththepartiesofthepriorjudgment(evenif,aswewillseebelow,thisrequirementhasbeenquestioned);and(v)theprecludedpartyshallhavehadafullandfairopportunitytolitigatetheprecludedissue.

Priortomovetotheanalysisofsuchrequirements,threepreliminaryremarksarenecessary.

248BothinEnglandandintheUS.SeeGunes(2015)(n.216),4-5.249For an historical analysis of collateral estoppel see Millar, Illinois Law Review of NorthwesternUniversity(1940),41andss.WithregardtothecostsavingaspectsofcollateralestoppelseealsoSpurr,InternationalReviewofLawandEconomics(1991),47andss.250S.Pac.R.R.v.UnitedStates,168U.S.1,48-49(1897).SeeNesin,NewYorkUniversityLawReview(2001),879.251Bain,JournalofDisputeResolution(1990),190.TheapplicabilityofcollateralestoppeltobothissuesoffactandissuesoflawhasbeenexplainedbyVestal,WashingtonUniversityLawQuarterly(1965),171andss.

155

Firstly, it isworth noting that the applicability of collateral estoppel is to bebasedonaflexibleapproachandistheresultofabalancingtestbetween,ontheoneside, thepublic interestsof finality, judicial economy, legal certaintyand coherenceand,ontheotherside,theprivate(and,toacertainextent,public)interesttoensurethattheprecludedpartyhashadthefullandfairopportunitytopresentitscase.Asaconsequence, the applicability of collateral estoppel is something that shall beascertained inconcretoandkeeping intoconsiderationthefactual frameworkofanydispute.

Secondly,itisworthnotingthat–while,initially,collateralestoppelhasbeenconsidered applicable onlywhen the entire claim including the precluded issuewasfinallydecided–inasecondphaseandwiththeaimofsavingtimeandcosts,judges(inparticularintheUS)haveadoptedamorepragmaticapproachandhaveconsentedthe application of collateral estoppel even if the issue was finally decided but theentireclaimwasstillpending.Theonlyrequirementforsuchanapplicationisthattheissue has been duly discussed in the first process and the second judge considersplausiblethattheresolutionofsuchan issue isdefinitiveandwillnotbechanged inthe finaldecision.252Thisapproachhasbeenendorsed in thesecondRestatementofJudgments,atpar.13.

Thirdly,notwithstandingsomecontraryvoicesinthepast,253itistodaybroadlyacceptedthat thecollateralestoppeleffectmayderivealsoby issuesdecidedbyanarbitration panel.254Therefore, both a second international tribunal and a nationalcourt should be bound by previous arbitral decisions on issues provided that therequirementsfortheapplicationofcollateralestoppelsetforthabovearemet.255

Movingtotheanalysisofthefirstrequirement,i.e.identityofissues,itisworthnotingthat“[w]hetheramattertobepresentedinsubsequentactionconstitutesthesameissueasamatterpresentedintheinitialactionisapragmaticquestion,turningon such factors as the degree of overlap between the factual evidence and legal

252Volpino(2007)(n.91),95-99.InthisregardseeLummusCo.v.CommonwealthOilRef.Co.,297F.2d(2dCir.1961),80andss.253Sanders,LawandPolicyofInternationalBusiness(1992),118-119,Motomura(1988)(n.219),32andss.254IngeneraltermsseeGunes(2015)(n.216),21andss.andBernal-Fandiño,Rojas-Quiñones,RevistaColombianadeDerechoInternacional(2010),455andss.ConcerningtheUSseeHulbert,InternationalTax and Business Lawyer (1989), 159 and ss., Cromwell (2000) (n. 219), 425 and ss., Collings, LosAngelesLawyer (2005),20andss.,Westerlind,Fox,Mealey’sLitigationReport (2010),1andss.Withregard to theUK seeFidelitasShippingCoLtd vV/OExportchleb [1965] 1Lloyd'sRep13 (CA),whereLord Diplock said "[i]ssue estoppel applies to arbitration as it does to litigation. The parties, havingchosen the tribunal to determine the disputes between them as to their legal rights and duties, arebound by the determination of that tribunal on any issue which is relevant to the decision of anydisputereferredtothattribunal."SeealsoAssociatedElectricandGas InsuranceServicesLtd (Aegis)vEuropeanReinsuranceCo.ofZurich(EuropeanRe)[2002]UKPC1129,[2003]1WLR1041(onappealfromthe Court of Bermuda). Finally see International LawAssociation, Interim Report: “Res Judicata” andArbitration,BerlinConference,2004,7andss. 255ThecollateralestoppeleffecthasbeenalsorecognizedbyEnglishCourtsandwithregardtoforeigndecisions. A recent decision applying such an approach is Yukos Capital S.a.r.L. v. OJSC Rosneft OilCompany,[2011]EWHC1461(Comm).SeealsoCasad,IowaLawReview(1984),53andss.

156

argument advanced with respect to thematter in the initial action and that to beadvancedwith respect to thematter in the subsequent action”.256It is, therefore, ataskof the judge tounderstandwhether there issubstantial identity of the litigatedissues,regardlessofthelabelofthevariousclaims.

With regard to the requirementof theprioractual litigation of theprecludedissue, what is essential is that “the parties to be bound and benefited must havesubmitted the issue for decision, and the adjudicatormust have decided the issue.Thus, issue preclusion does not result from a default, admission, or stipulation”.257Furthermore, contrary to res judicata, collateral estoppel does not apply to “issueswhichmighthavebeenraisedinthepriorlitigation,butwerenot”.258

Moving to the requirement that the issue has been essential for the priorjudgment, itshallbedetermined inconcretowhetherthedeterminationofthat issuehasbeennecessarytoreachingthecourtultimateresult.AsexplainedbyCasadandClermont, “[t]he idea behind this requirement is that such a determination in thenatureofdictamaynothavebeenunavailableor unmotivated”.259However, in thisregardit isworthnotingthattheapplicationofthisrequirementwillbeattenuateincasesofapplicationof collateralestoppelprior to the issuanceof the finaldecision,duetothefactthatsometimesitcouldbedifficulttounderstandwhetherthedecidedissuewillbeessential for the finaldecision. Indeed, thesecond judgewillbeonly inthepossibility tomakeaprognosticevaluationofwhether thedecided issuewillbeessentialforthefinaldecisioninthepriorjudgment.

Concerning the fourth requirement, i.e. identity of the parties, “collateralestoppel(…)requiresthatthepartiestothesecondactionbethesameas,orinprivitywith,thepartiestothefirstaction.Thisrequirementisgenerallydenominatedastherule of mutuality”. 260 The concept of privity and the related requirement ofcommonalityofinterests,tobeascertained inconcreto,havebeenalreadyexaminedinParagraph3.6above.261Itishereworthnotingthat,withregardtotheapplicabilityofcollateralestoppel,“courtshaveoftenmanipulatedthenotionofprivitytopermitnon-parties to preclude the relitigation of issues that earlier law suits havedetermined. At times the privity concept has assumed wondrous attributes offlexibility as courts attempt to apply their subjective sense of fairness to situationsthatdonotfitneatlywithinthetraditionalrequirementfor[issue]preclusion”.262This

256Casad,Clermont(2001)(n.98),116.257Id.,123-124.258Polasky(1954)(n.106),222.259Casad,Clermont(2001)(n.98),127.260Cunningham,Missouri Law Review (1976), 521-522. See alsoMoore, Currier, Tulane Law Review(1961), 301 and ss., Semmel, Columbia Law Review (1968), 1457 and ss., SeeMorris, California LawReview (1988), 1105, The Mutuality Requirement in Res Judicata and Estoppel by Record, Note in 2WashingtonandLeeLawReview233(1941).261SeeVestal(1974)(n.212),361-362,Semmel(1968)(n.260),1460.SeealsoCrockettv.Harrison,26Ill.App.2d9,13,167N.E.2d428,430(1960),whereithasbeenstatedthat“[u]nderthetermpartiesinthisconnection, the law includesallwhoaredirectly interested in the subjectmatter, andhada right tomakeadefenseortocontroltheproceedingsandtoappealfromthejudgment”.262Watson(1990)(n.162),627-628.

157

tendencyhasleadsomeUScourts(notUKcourts)toabandontheruleofmutuality;thereasonforsuchanabandonmenthasbeenthat“[t]heredoesnotappeartobeaconstitutional prohibition against allowing a prior judgment to be subsequentlypleadedbyanon-partytotheinitialaction”(so-calledBernharddoctrine).263

However,theabandonmentofmutualityhasbeencriticizedbyProf.Currie,aswellasbyCasadandClermont,264duetothenecessitytorespecttherequirementofdueprocess, i.e. the possibility for eachparty to have a full and fair opportunity topresentitscase.265Indeed,therespectofdueprocess isthelastrequirementinordertoapply collateral estoppel.Aswehave seenabovewith regard to res judicata, therespectofdueprocessissomethingthatshallbeascertainedonacase-by-casebasisandcannotbedescribedapriori.Itis,indeed,necessarytoascertainthatsuchaparty(orprivy,or, if one shouldaccept theabandonmentofmutuality, stranger)hashadconcretely the opportunity to present its claim.266It is, in conclusion, impossible totake in abstracto a position on the correctness of the Bernhard doctrine. Even if itcouldseemverydifficultthatastranger’sinterestsarefullyrepresentedinajudgment(and, therefore, dueprocess is respected)between twootherparties, theprevalentapproachintheUSseemstorequireanascertainmentoftheconcreterepresentationofanon-partyinthepreviousjudgment.267

Having introduced the main features and requirements of the doctrine ofcollateralestoppel,itisnownecessarytoascertainwhetherandhowsuchadoctrineappliesininternationallaw.

3.7.2 Collateralestoppelininternationalinvestmentlaw:TheRSMandApotex

cases, the call for a more flexible approach and the source of judges’powertoapplysuchanapproach

Thereisveryfewliterature268regardingtheapplicabilityofcollateralestoppel

in international investment law and,more generally, in international law.However,therearesomeinternationalauthoritiesthatcouldbetakenintoaccountasastarting

263Cunningham(1976)(n.260),527.SeeBernhardv.BankofAmericaNat.Trust&SavingsAssn.,122P.2d 892 (S.C. Cal. 1942), 894-895, in which the Court allowed a non-party plaintiff to benefit of theresults of a prior judgment in favour of another plaintiff (offensive use of collateral estoppel). InBlonder-TongueLabs. Inc.v.Universityof IllinoisFoundation402U.S.313,collateralestoppelhasbeenusedbyanon-partydefendantinordertoprecludeanactionbyaplaintiffwhoalreadydidnotsucceedinthesameactionagainstanotherdefendantwhowasinthesamesubstantiveandfactualsituationofthe second defendant. In this regard, Cunningham, at 530, stated that “[a]bsent extraordinarycircumstances,thereislittlereasontoallowtheplaintifftheopportunitytopickandchooseamongthepossibledefendantsandsueeachseparatelyinhopesofeventuallyfindingakindlyorconfusedjury”.SeealsoWaggoner,TheReviewofLitigation(1993),392andss.,Ellis,IndianaLawReview(1980),563andss.264Casad,Clermont(2001)(n.98),184.265Currie,StanfordLawReview(1957),281andss.266Hansberryv.Lee,311US32,42(1940).SeealsoVestal,MichiganLawReview(1963),49-51.267Casad,Clermont(2001)(n.98),184.268See Kotuby, Egerton-Vernon, ICSID Review FILJ (2015), 486 and ss., Bowett, British Yearbook ofInternationalLaw(1957),178-189,Andritoi,ActaUniversitatisDanubius(2011),47andss.

158

pointinordertotrytounderstandwhetherandhowcollateralestoppelmaybeusefulinordertopreventparallelproceedingsininvestmentarbitration.

Thefirstcasethat,evenifwithoutmentioningit,appliedcollateralestoppelisthe already mentionedDelgado case.269In this case, as already stated, there havebeentwosubsequentprocessesregardingtheseizureofaproperty,onefordamagesandanother for thevalueof theproperty.AsnotedbyBowett,270whileapplying resjudicata,theUmpireofthesecondarbitrationallowedtoproceedapartofthesecondclaimwhichwasnotbroughtbeforethefirstUmpire.Sucha“partialresjudicata”hasbeen considered by the same Bowett as “scarcely reconcilable wit the completepreclusion of the res judicata doctrine” and is, indeed, an application of collateralestoppel.271

A reference to collateral estoppel in international law may be found in theCompany General of the Orinoco Case272, in which the Arbitral Tribunal expresslyquoted the United States Supreme Court dictum inSouthern Pacific Railroad Co. v.UnitedStates,273according towhich“[t]hegeneralprincipleannounced innumerouscasesisthataright,question,orfactdistinctlyputinissue,anddirectlydeterminedbya court of competent jurisdiction as a ground of recovery cannot be disputed in asubsequentsuitbetweenthesamepartiesortheirprivies,and,evenifthesecondsuitisforadifferentcauseofaction,theright,question,orfactoncesodeterminedmust,asbetweenthesamepartiesortheirprivies,betakenasconclusivelyestablishedsolongasthejudgmentinthefirstsuitremainsunmodified”.

The same dictum has been then reaffirmed by a Tribunal chaired by Prof.HigginsintheAmcoII274case.

Another,andprobablythemostimportant,casewherecollateralestoppelhasbeen applied in international law is S Grynberg, Stephen M Grynberg, Miriam ZGrynberg, and RSM Production Corporation v Grenada. 275 This case regarded aninvestment treaty arbitration (under the USA-Grenada BIT) that was commencedbefore ICSID by the company RSM Production and its three shareholders, whocollectively, inequalshares,owned100%oftheoutstandingcapitalofRSM(wewilltall, inthisregard,ofthe“treatyarbitration”).However,thetreatybreachesclaimedin this arbitration arose from thebreachof an investment contract, signedbyRSMandGrenada,whichcontaineditselfanICSIDarbitrationclause.Suchacontracthad

269DelgadoCase,inMoore,InternationalArbitrationstowhichtheUnitedStatesHasBeenaParty2196(Spanish–USClaimsCommission1881).270Bowett(1957)(n.268),179.271ThesameBowett(1957)(n.268),179,referstotheHayadelaTorre(Colombiav.Peru)case,ICJRep,1951,71, inwhichthecourtexpresslystatedthatacertainissue(i.e.whetherornottherewasa legalobligationtosurrenderarefugee)wasnotdecidedinthepreviousAsylum(Colombiav.Peru)case,ICJRep1950,266,andthereforethediscussionofthatissuewasnotprecluded.272Awardof31July1905,availableathttp://legal.un.org/riaa/cases/vol_X/184-285.pdf.273168U.S.1,48-49(1897).274Amco Asia Corporation v. Republic of Indonesia (ICSID Case No. ARB/81/1(, Resubmitted Case,DecisiononJurisdiction,10May1988,par.30.SeealsoGunes(2015)(n.216),13.275ICSIDCaseNoARB/10/6,10December2010.

159

alreadygivenrisetoaninvestmentarbitrationbeforethesameICSID,RSMProductionCorporation v. Grenada,276this time only for claims arising from the contract (thisarbitrationwillbereferredtoasthe“contractarbitration”).Inthecontractarbitrationa final award was rendered on 13 March 2009 in favour of Grenada, stating thatGrenada did not breach any of its contractual obligations. RSM, then, applied forannulmentand–atthetimeofthecommencementofthetreatyarbitration–suchanapplicationwasstilloutstanding.277Thecase,therefore,canbeclassifiedasacaseofparallelcontractandtreatyclaims,wherethecontractclaimswasstartedonlybytheinvestor company,while the treaty claimwas startedby the samecompanyand itsshareholders.

Duringthetreatyarbitration,Grenadacontendedthatallthelegalandfactualarguments raised by the claimants had been already litigated in the contractarbitrationand,therefore,thetreatyarbitrationwasstartedinviolationofArt.53oftheICSIDConvention,accordingtowhichawardsarefinal,bindingandnotsubjecttoappeal or review. Grenada asked for an application of the principle of collateralestoppeland,basedonthefactthatthethreeshareholderswerepriviesofRSM,forthedismissaloftheproceedingsonthebasisoftheinherentpowersoftheTribunaltoprotecttheintegrityofitsownprocess(par.4.6.16).

The claimants replied that the triple identity test was not met and that todismiss theprocesswouldhavebeenan “obscuration”of the independent intereststhatthethreeindividualclaimantspossessedundertheTreaty,i.e.aviolationofdueprocess(par.5.3.6).

TheTribunalstarteditsreasoningbysayingthat“[i]t is(…)notdisputedthatthedoctrineofcollateralestoppel isnowwellestablishedasageneralprincipleof lawapplicable inthe internationalcourtsandtribunalssuchasthisone”(emphasisadded)(par.7.1.2).TheTribunalalsorecognizedthattheshareholderswerepriviesofRSMatthetimeofthecontractarbitrationand,therefore,wereboundbythosefactualandother determinations regarding questions and rights arising out or relating to theagreement(par.7.1.5).Thetribunalstatedthat“[o]fcourse,RSMisa juridicalentitywitha legalpersonalityseparate fromits threeshareholders.Butthisdoesnotaltertheanalysis.(…)Itistruethatshareholders,undermanysystemsoflaw,mayundertakelitigationtopursueordefendrightsbelongingtothecorporation.However,shareholderscannotusesuchopportunitiesasbothaswordandshield.Iftheywishtoclaimstandingon the basis of their indirect interest in corporate assets, they must be subject todefences that would be available against the corporation – including collateralestoppel”(emphasisadded)(paras.7.1.6and7.1.7).Hence,thetribunaldeclaredthattheclaimsweremanifestlywithoutlegalmeritanddismissedalltheclaims.

276ICSIDCaseNo.ARB/05/14.277However, theadhocCommitteediscontinuedtheannulmentproceedings inadecisionof28April2011.

160

The reasoning of the RSM treaty arbitration has been applied also by theTribunal inApotexHoldings Inc.andApotex Inc.v.UnitedStatesofAmerica.278Inthiscase the Claimants made claims for breach by the Respondent of several of itsobligationsunderNAFTAandtheJamaica-USABITbothforthemselvesandalso(byApotex-Holdings) for Apotex-US (we will refer to this arbitration as the “secondarbitration”).However,Apotex Inc.hadalreadystartedaNAFTAarbitrationagainsttheUSAaccording to theUNCITRALArbitrationRules, inwhichmanyof the issuesclaimed in the second arbitration had been already decided (this arbitrationwill bereferredtoasthe“firstarbitration”).279Thefirstarbitrationwasnotconcludedwhenthe second arbitration was started. However, when the award in the secondarbitration was rendered, an award on jurisdiction and admissibility in the firstarbitrationwasrenderedanddeniedjurisdictiononthebasisofthenon-existenceofaninvestmentaccordingtotheNAFTA.

USaskedforanapplicationofcollateralestoppelwithregardtoalltheissuesalreadydiscussed anddecided in the first arbitration, i.e. the lack of an investmentaccording to the NAFTA wording (actually, the US asked for an application of theprincipleof res judicata butonlywith regard to issuesalreadydiscussedby the firsttribunal. It is thereforepossible to conclude that theUSasked for anapplicationofcollateral estoppel and that the references to res judicata in the Award should beactuallyintendedasreferencestocollateralestoppel).

Theclaimantscontendedthat“notionsofissueestoppelfoundincommonlawsystemsarenotfoundincivillawsystems,whichtypicallylimitresjudicataeffectstomatters addressed in the dispositif of an award or judgment” (par. 7.22). For thisreasontheClaimantsstatedthatcollateralestoppelcannotbesaidtobeanaspectofresjudicataasageneralprincipleoflawrecognisedbycivilnations.Furthermore,theclaimants argued that – even if the Tribunal should have considered collateralestoppel applicable to the case at hand – the triple identity test was not met, inparticularbecausethepartiesweredifferent.

TheTribunal recognizedthehistoricaldifferencesbetweencivilandcommonlaw systems, but also stated that there is a general tendency, even in civil lawcountries,torecognizeres judicataeffectstothereasoningofawardsanddecisions.AccordingtotheTribunal,thisapproachrenderscivilandcommonlawsystemsmoresimilar and allows an international tribunal to give res judicata effects to the issuesdecidedwithinapreviousaward/decisiononthesamedispute,whichcanthereforebethelegalbasistoapplycollateralestoppel.280TheTribunalalsoextensivelyreferredto278ICSIDCaseNo.ARB(AF)/12/1,Award,25August2014.279Seetheawardonjurisdictionandadmissibilityof14June2013madebytheNAFTATribunal(TobyT.Landau,CliffordM.Davidson,FernM.Smith) in theUNCITRALArbitrationbetweenApotex Inc.andtheRespondent.280The Tribunal, at par. 7.24-7.29 cited several Authorities supporting its view that the reasoning ofinternationalAwardshastheforceofresjudicataandcanthereforebethebasisfortheapplicationofcollateralestoppel.Inparticular,itcitedthePiousFundArbitration(UnitedStatesofAmericav.Mexico),Award,14October1902,thePolishPostalServiceinDanzig,AdvisoryOpinion,1925PCIJ(Ser.B)No.11,16May1925,par.86, theCaseConcerning theDelimitationof theContinentalShelf (UKv.France), 18

161

the abovementionedRSM treaty arbitration (as well as to theOrinoco andAmco IIcases) inordertogivea legalfoundationtotheapplicabilityofcollateralestoppel ininternationallaw.

Given the above, the Tribunal also recognized that privies are bound bydecisionstowhichtheydidnot formallytookpart.TheTribunal,atpar.7.38,statedthat“[t]hetwonamedClaimants inthisarbitrationstand insimilarshoesasregardstheeffectofresjudicataresultingfromthe[firstarbitration],notwithstandingthefactthatonlyoneofthemwasanamedpartytothe[firstarbitration]”.Apotex-HoldingswasthereforeconsideredaprivyofApotex Inc.andboththepartieswerethereforeboundbyre-discussthemattersalreadydecidedinthefirstarbitration.

Alltheawardsdescribedaboveareofextremeimportanceforpolicyreasons.Indeed,theyfollowedasubstantive/transactionalapproachwhichallowstosafeguardall the policy considerations outlined in Chapter 1 above and, as a consequence, isessential forensuringthe legitimacyof investmentarbitration. Indeed,theRSMandApotex awardshavebeenwarmlywelcomeby scholars.281TheseAuthorshaveeventalkedaboutanemergingtrendbasedontheadoptionofasubstantive/transactionaltestforthedeterminationofresjudicataissuesininternationalinvestmentlaw.

It is maybe too early to arrive to such a conclusion (which, however, ifconfirmed, shouldbewarmlywelcome).Similarly, the scarcityof the case lawdoesnotallowus tostate thatcollateralestoppelhasassumedthestandingofageneralprincipleofinternationallaw,assomeTribunalshavestated.

However,whatisimportantforthesakeofthepresentbookisthatthesecasesprove that arbitral tribunals do have the inherent powers to dismiss a claimon thebasis of the applicationof thedoctrineof collateral estoppel. Such an approach, asalreadysaid,isstronglydesirable282and,ifconfirmedinthefuture,wouldsurelyraisethelegitimacyofinternationalinvestmentarbitration.

3.8 ConcreteapplicationsoftheproposedsolutionsininvestmentarbitrationItisnowtimetocheckhowtheproposedtoolsmayconcretelyapplyinorder

topreventandlimitparallelproceedingsininternationalinvestmentarbitration.

RIAA272,14March1978,295,par.28,theRequestforInterpretationoftheJudgmentof20November1950 in theAsylumCase (Colombiav.Peru), Judgmentof27November 1950, ICJRep. 1950, 395, theCorfù Channel Case, Judgment of 9 April 1949, ICJ Rep 1949, 4, theRequest for Interpretation of theJudgment of 15 June 1962 in the case concerning the Temple of Preah Vihear (Cambodia v. Thailand),Judgmentof11November2013(ICJ).TheTribunalalsomentionedtheCJEUcasesAsteris&Greecev.Commission, [1988] ECR 2181, par. 27, and Commission of the European Communities v. BASF AG &Others,[1994]ECRI-2555,par.67.281SeeKotuby,Egerton-Vernon(2015)(n.268),486andss.Itisworthnotingthat,evenin1957Bowett(1957) (n. 268), 170 stated that collateral estoppel “is a notion which international tribunals mightusefullyadopt”.282 Bowett (1957) (n. 268), 180 stated that “much might be gained by a clear recognition byinternationalcourtsofthisdistinctionbetweenthetotalbarofresjudicataandpartialbarofcollateralestoppelorissueestoppel”.

162

Itis,firstofall,necessarytounderstandwhethersuchtoolsareallapplicableincases of subsequent proceedings and in cases of concurringproceedings (i.e.whichrun in parallel). In this regard it is worth noting that while abuse of process andcollateral estoppel may apply in both the described situations, as we have seen inParagraph3.6.1above,resjudicataisbasedontheassumptionthatthefirstclaimhasbeenfinallydecided.Forthisreasonincaseofconcurringproceedingsarbitratorsmayhavethepossibilitytorelyonlyonthemoreflexibledoctrinesofabuseofprocessandcollateralestoppel.

We will now analyse how any of the proposed criteria apply to the varioussources of parallel proceedings, namely a) contract and treaty claims; b) chain ofcompaniesofthesamegroup;c)majorityandminorityshareholders(orcompanyanditsshareholders);andd)claimsstartedunderthesametreaty.

a) ContractandtreatyclaimsIncaseof contractand treatyclaims,aswehaveseen, themainproblem (in

particularconcerningtheapplicabilityofres judicataandcollateralestoppel)regardstheabstractpossibilitytosupposetheexistenceofaconflictof jurisdictionbetweentwo proceedings which allegedly arise from different legal orders. However, asdemonstrated inparagraph3.6.5above, thebetterapproach (i.e. theoneapplied inthe RSM second arbitration) is to ascertain whether the two parallel contract andtreatyclaimsaresubstantiallyidenticalandiftheyconstituteawaytocircumventthecorrect application of the principles of finality and judicial economy, as well as thecredibilityofinvestmentarbitrationasadisputesettlementmechanism.

If theaboveapproach isaccepted, it is submitted thatall theproposed toolsareapplicabletothecaseofcontractandtreatyclaims(withtheobviouslimitthatresjudicatarequiresthepriorconclusionofthefirstarbitration).

Ifonlysomeoftheclaimsfiledinthefirstarbitrationareproposedalsointhesecondarbitration,aswehaveseenintheApotexcase,collateralestoppelmaybeaveryusefultoolinordertoavoidthere-discussionofthealreadysettledissues.

Duetothesubstantial identityoftheparties,wecannotseeanydueprocessprobleminthiscase.

b) ChainofcompaniesofthesamegroupThe CME and Lauder cases are the paradigm of this scenario. Taking into

accountwhathappenedinsuchcases, it issubmittedthatalltheproposedtoolsareapplicable by arbitrators in order to avoid parallel proceedings that are formallydifferentbutsubstantiallyidentical.

In this case, if the parallel claims are all arising from violation of treatyobligations,thedegreeofidentitybetweenthetwoproceedingswillbeprobablyveryhigh,mainlyduetothealreadydiscussedcircumstancesthatBITsusuallycontainverypoorformulationofstandardsoftreatmentandsuchstandardsarenowconsideredtohaveanautonomouscontentandstandingininternationalinvestmentlaw.

163

However,alsointhiscase,ifonlycertainclaimsarepresentinthetwoparallelclaims,theapplicationofcollateralestoppelisthesuggestedalternative.

Also in this case, finally, due to the substantial identity of the party, thereseemsnottoexistanydueprocessconcern.

c) Majorityandminorityshareholders(orcompanyanditsshareholders)This is the most problematic case, due to the circumstance that the privity

relationship between the various shareholders of the company (or between thecompany and its shareholders) shall be necessarily ascertained on a case-by-casebasis.

Itisherenecessarytomakesomedistinctions.IncaseanunsuccessfulclaimisbroughtagainstaState,byashareholderorby

the company, and such a shareholder (or company) it considered to be in concretorepresentingtheinterestsoftheothershareholders(oroftheentirecompany),i.e.inprivitywiththem,wecannotseereasonstonotapplytheproposedtoolsincasetheclaimfailsandtheState’sdefencesprevail.Indeed,itseemsunfairtoobligetheStatetohavetodefenditspositioninseveralsubstantiallyidenticalclaims.TheStatewillbethenentitledtoaskforanapplicationofabuseofprocess,res judicata (ifapplicable)andcollateralestoppel.

IftheStateloosesthefirstarbitration,itisnecessarytodistinguish:(i)ifoneofseveralshareholdersissuccessfulprorata(i.e.foranamountofclaimproportionaltoits shares), and the allegedly violated standards of treatment are substantiallyidentical, theother shareholders shouldbeentitled to relyon thepreviousdecisionandtomakeanoffensiveuseofcollateralestoppel(i.e.anapplicationoftheBernharddoctrine); (ii) if the first claim is broughtby theentire company, it is likely that thecompany, representing all its shareholders,283will be awarded an amount whichencompassesalso the rightsof theshareholders.Therefore,once theStatehas lostthe first arbitration against the company, it should be entitled to invoke all theproposedtoolsinsubsequentclaimsstartedbytheshareholders(otherwisetheStatewould run the risk to be condemnedmore than one time for the samedamage). Ifwhentheclaimoftheshareholdersisstartedthecompany’sclaimisstillpending,theStatewill be obviously able to rely only on collateral estoppel (if some issues havebeendecided)andabuseofprocess.

However,ifacommonalityofinterestisnotpresentinconcreto,itissubmittedthat serious dueprocess concernsmay arise. In this case, theonly possible remedyseemstobethedevelopmentofaformofinterventionbywayofamendmentoftherelevantarbitrationrules.SuchatoolwillbeanalysedinParagraph3.9below.

d) Claimsstartedunderthesametreaty.

283ThissubjecthasbeenstudiedbyGottlieb,CaliforniaLawReview(1978),1093-1094.

164

As we have discussed in Chapter 1, this case is of mere academic interest.However,itisobviousthatinthiscase,duetheformalandsubstantialidentityofbothpartiesandcauseofaction,alltheproposedtoolsareapplicable.

3.9 A solution de jure condendo in order to preserve due process in case of

multiple claims by shareholders: the possible third parties’ right to beinformedandtointerveneintheproceedings

Aswehave seen in theprecedingParagraph, in caseof parallel proceedings

started by various shareholders it is possible that the various claimants are notconsidered to be in privity and, as a consequence, the proposed solutions cannotproperlywork,becausetheywouldamounttoanundulyviolationoftheprincipleofdueprocess.

Ifasituationlikethisarisesbeforeanationalcourt,thesolutionwouldbeverysimple.Allprocedurallawsprovideforcompulsoryjoinderofthirdparties:inthiscase,inordertosafeguardthecanonofjudicialeconomy,thethirdpartyshareholderwouldbesubjecttoacompulsoryjoinder.

Would this be possible in international investment arbitration? The straightanswer seems to be no, due to the necessity to respect the principle of partyautonomy in arbitration. From the perspective of a third party, the arbitrationagreementisresinteraliosactaandhecannotbeforcedtojoinaprocessthathedoesnot want to join (also in light that the pre-existing parties might not want aninvolvement of the third party). However, this answer is very simplistic because itcompletely ignores the circumstance that, as we have already demonstrated,regardless of its willingness the third party may suffer the effects of the decisionrenderedbetweenotherparties.There is, therefore,aconflictofvalues:on theoneside,partyautonomyand,ontheotherside,thenecessitytoprotecttherightsofthethird partywhichmay be subject to the effect of an arbitral awardwithout havingparticipated to the issuanceof the sameaward.As ithasbeennoted, this situationreveals the “intrinsic weakness of arbitration. (…) [indeed] the lack of adequatecompulsory powers for arbitrators reveals the fragility of arbitration when facingexternalobstacles”.284

One could therefore wonder whether there could be a solution to such asituationofimpasse.Severalscholarshaverecognizedthat“[w]hereanawardmaybe,or has beenmade against the interests of the third party, it is reasonable to allowaccesstothearbitralchamber”.285However,itisdifficulttogivealegalfoundationtosuchapowertointerveneortobecompulsorilyjoinedinthearbitration.OneAuthorhastriedtofoundsuchapossibilityonthe inherentpowersofthearbitral tribunals,284Piergrossi,StudiinonorediEnricoTullioLiebman(1979),2572.285Olatawura, The American Review of International Arbitration (2005), 440. See also Gradi, Rivistadell’arbitrato (2010), 301, Ruffini (1995) (n. 217), 648 and ss., Consolo, Rivista di diritto processuale(2013), 1413, Fazzalari (1995) (n. 217), 619 and ss., ZucconiGalli Fonseca (2004) (n. 209), 728 and ss.ContraseeTarzia,Rivistadidirittoprocessuale(2004),350.

165

stating that “the fact that the arbitration statute does not expressly provide suchpowerdoesnotestablishthatitisforbiddentoatribunal.(…)Anarbitraltribunalactsnotonlyontheapplicationofapartytothearbitration,butalsoonitsowninitiative.Theprincipleofarbitraleffectivenessmakes it imperative for thearbitral tribunal tojoinpartieswherenecessaryordesirableortoallowathirdpartytocommenceclaimsunderanarbitrationagreement”.286Suchasolutiondoesnotseemfeasiblebecause,inapplying it, thearbitral tribunalwouldundulyextend its jurisdictionbeyondwhathasbeenexpresslyagreedbytheparties.

However, a solution could be found by way of amending the relevantarbitrationrules(e.g.theICSIDArbitrationRulesortheUNCITRALRules)inordertoofferaformofprotectionfortheinterestsofthirdparties.287

Indeed, as it has been duly noted,288several rules regulating internationaldispute settlement proceedings do provide a form of intervention in order to offerprotection to the rights of third parties. In this regard, it is possible to refer to theStatuteoftheICJ,289theStatuteoftheITLOS,290andtheDSUoftheWTO.291

Theproposedamendmenttoarbitrationrulescouldbemadeprovidingforthefollowingproceedings:

1)therequesttojointhethirdpartyshouldbemadebyonlyaparty(andnotbothofthem), i.e., inourcase,therespondentState.Thefactthattherequestshallnot come from both the parties is based on the circumstance that, if the requestshould come from both of the parties, the claimant would not probably give itsconsenttosucharequest;292

2) upon request of a party, the arbitral tribunal will have tomake a secondrequest to the third party in order to askwhether if such a third party iswilling tointerveneinthearbitration;

3) if the third party refuses to intervene in the arbitration, itwill be then beestopped293to claim that the award does not have a res judicata (or collateralestoppel)effectonit;294

286Olatawura(2005)(n.285),451-452.287ThiswayofextendingthepossibilitytointervenetothirdpartieswasalreadyproposedbyPiergrossi(1979)(n.284),2591.288Bonafè(2014)(n.158),16.289See Art. 62 and 63 of the ICJ Statute, onwhich seeWolfrum, Liber AmicorumGünther Jaenicke(1998), 427 and ss., Bonafè (2014) (n. 158), 18 and ss., Palchetti (2002) (n. 215), 139 and ss., Forlati(2002)(n.215),99andss.290SeeArt.31and32oftheITLOSStatute,onwhichseeWolfrum(1998)(n.289),439andss.291SeeArt.10(2)oftheDSU.292ThishasbeenstatedbyGradi(2010)(n.285),304.293Theprincipleofestoppel,expressedbytheLatinmaximnonvenirecontrafactumproprium,hasbeenlargely recognized in international law. See Cottier,Müller,MaxPlanck Encyclopedia of InternationalLaw (2007), Bowett (1957) (n. 268), 176 and ss. McGibbon, International and Comparative LawQuarterly (1958),468andss.,Wagner,CaliforniaLawReview(1986),1777andss.,Ovchar,BondLawReview(2009),1andss.Accordingtosuchaprinciple,ifapartyinaprocessexpressesitswillingnessina certain sense, suchapartywill be estopped to claim something contrary to thedeclaration that itmadebefore.

166

4)ifthethirdpartyacceptstointerveneintheproceedings,itwillbeentitledtofileitsdefencesandwillbeboundbytheawardasifitisaparty.295

However,this lastcaseleavesuswiththeproblemoftheappointmentofthearbitraltribunal. Is itfairtoconsiderthatthejoinedthirdpartywillbesubjecttothetribunal selected by the other two parties? As amatter of principle, even if from amerely psychological point of view the third party might feel prejudiced by theimpossibility to choose its arbitrator,296it does not seem that this circumstancecorrespondstoanactualprejudice.Indeed,asithasbeennoted,297arbitratorshaveageneral duty of independence and impartiality. Arbitrators shall act as impartialjudges and treat equally all the parties, regardless of the fact that they have beenappointed by a certain party. The joined third party, as a consequence, should notsufferaprejudicebythefactthatitdidnotconcurintheappointmentofthetribunal.

However, ifoneonlyacceptsthatallthepartiesshallhaveequalrightsintheappointmentof theTribunal, theonlypossiblesolutionseemstobethat–after thejoinder – the original tribunal (or the sole arbitrator) is replaced by another one,chosen and appointed by an appointing authority. Such authority could be therelevant arbitral institutionor a person such as thePresident of theTribunal of theseatofarbitration (incaseofadhocarbitration).Thissolution,whichseemsequallyfair, isbasedontheassumptionthattheprincipleofequalityofthepartiesdoesnotmeanthatanypartyshallappointitsownarbitrator,butthatallthepartiesshallhavethe same rights regarding the appointment of the tribunal. If a neutral authorityappointsthetribunal,theprincipleofequalityisnotimpaired.298

3.10 ConclusionsThepresentChapterhasanalysedwhetherarbitraltribunalshavetheinherent

power to not exercise their jurisdiction at the admissibility stage in case of parallelproceedingsininvestmentarbitration.Suchpowersshouldfindtheirlegitimacyinthecircumstancethatthecontinuanceofduplicativelitigationconstitutesathreattotheintegrityofthejudicialprocessandaviolationoftheprincipleofgoodadministrationof justice. It is arguable thatarbitratorsdohave suchapowerand that they shouldexercise it if the continuance of the proceedings runs against general principles ofinternationallaw.

294ThishasbeenstatedbyFazzalari (1995) (n.217),658,accordingtowhomoncethethirdpartyhashadtheopportunitytojointhearbitrationandhasrefusedsuchanopportunity,hewillbesubjecttoresjudicata.295AsimilarprovisionisnowsetforthbyArt.45(8)ofthenewRussianArbitrationLaw,enactedon29December 2015. See, in this regard, the comment by Karimullin atwww.kluwerarbitrationblog.com,postedon11February2016.296Chiu,JournalofInternationalArbitration(1990),58.297Tizi, Rivista dell’arbitrato (2008), 486 and ss. This Author has explained that there is a duty ofimpartialitybothforthetribunalasawholeandforarbitratorsassingleprofessionals.298Id.,488.

167

Thereare, indeed,certaingeneralprinciples,namelygood faithandnebis inidem,whose concrete application seems to preclude the continuance of duplicativearbitrations.

Infacttheconcreteapplicationofgoodfaithinproceduralmattersgeneratesthedoctrineofabuseofprocess,whichimposestothepartiestonotmakerecoursetoinvestmentarbitrationwiththeaimofgettingunfairadvantagesand/ortoharasstheotherparty.Ifproceduralrightsarenotexercisedfortheirproperscope,itisarguablethataclaimdoesnotdeservetheprotectionofthelawandthatsuchaclaimshouldbedeclaredinadmissible.

Turning on the concrete application of ne bis in idem, it can lead to anapplicationofclaimpreclusion(resjudicata)andissuepreclusion(collateralestoppel),twodoctrineswhichareaimedatensuringfinalityofjudicialdecisions(respectivelyonentire claims or single issues), coherence and stability. After having analysed thevariouspossibleapplicationsofsuchdoctrines,ithasbeendemonstratedthattheresjudicataandcollateralestoppeleffectsofarbitraldecisionsareipsofactoextensibleonthird parties who are in privity with one of the parties of the first claim. If a thirdparty’sinterestshavebeenadequatelyrepresentedbytheclaimantinthefirstaction,such a third party will be therefore precluded to start a second claim which issubstantially identical towhathasbeenalreadydecided. In suchacase, the secondclaimshouldbedeclared inadmissible.Therefore, ifbroadly interpreted, res judicataandcollateralestoppelcanbeveryusefulinordertopreventparallelproceedingsandconflictingdecisions.

Havingascertainedthatarbitratorshavethepowertoapplythesedoctrinesinordertopreventparallelproceedings,theChapterhasmovedtoanalysewhetherandhow they are applicable in the various scenarios of parallel proceedings outlined inChapter1,aswellas,howtheycanbereconciledwiththeprincipleofdueprocess.

The Chapter has been finally concluded with a proposal of amendment ofarbitration rules in order to simplify the involvement of third parties (which wouldanywaysuffertheeffectsofarbitrationawards)inarbitrationproceedings.

168

Chapter4Post-awardremedies

This concludingChapterwill regard the possible (if any) remedies to parallel

proceedingsatthepost-awardphaseofinvestmentarbitration.As a preliminary remark, it should be noted that if the problem of parallel

proceedings comes to this stage, it is often too late to find a solution to it (inparticular,aswewill seebelow, incaseonewould try toprecludeenforcementofaduplicative ICSID award). For this reason, it is arguable that a solution to parallelproceedingsshallbefoundatpriorstages.

The analysis of post award remedies to parallel proceedings requires that acleardistinctionismadebetweenthepostawardremediesinICSIDarbitrationandinnon-ICSIDarbitration.1Themaindifferencestays inthefactthat ICSIDisconsideredtobea “self-contained systemof arbitration, fully autonomousand independentofany national systems, including the systemprevailing at the place of an arbitrationconducted under the [1965Washington] Convention. This self-contained regulationcovers all aspects of the arbitral proceedings and extends to the challenge of theawards, the latterbeingregulatedonlybytheConvention,withoutany interferenceby national courts or other national authorities, no room for the application of theNew York Convention being made regarding enforcement of an ICSID award”.2Hence,whenanICSIDawardisissued,theonlyavailableremediestolimittheefficacyor the validity of such an award are set forth in the Washington Convention. Theaward is final and binding for the courts of all the contracting States and shall berecognizedasanationaldecisionhavingresjudicataeffects.

On the contrary, non-ICSIDawardsmaybeeither challengedat theplaceoftheseatofthearbitration3or,ifoneofthegroundssetforthinArt.VoftheNewYorkConvention 1958, the courts of the State where such enforcement is requiredmayrefusetheirenforcement.4

In light of the different regulations of the post award stage, the analysis ofpossiblepost-awardremediesaimedatavoidingtheexistenceoftwoawardsarisingfromtwoparallelproceedingsshallbeconductedseparatelyonthebasisofwhetherthe second (duplicative)award is issuedwithin the ICSID frameworkornot.Wewillfirstly examine the remedies available within the ICSID self-contained system, andthenexamine: (i)whether theenforcementofanaward resulting fromaduplicativeproceedingmayberefusedaccordingtotheprovisionsoftheNewYorkConvention;

1 Bernardini, http://www.arbitration-icca.org/media/0/12970223709030/bernardini_icsid-vs-non-icsid-investent.pdf(2009),4andss.2Id.,5.3See Lew, Mistelis, Kroll, International and Comparative Commercial Arbitration (2003), 663 and ss.,Blackaby,Partasides,Redfern,Hunter,RedfernandHunteronInternationalArbitration(2015),569andss.,Rubino-Sammartano,InternationalArbitrationLawandPractice(2014),1273andss.4SeeLew,Mistelis,Kroll(2003)(n.3),687andss.,Blackaby,Partasides,Redfern,Hunter(2015)(n.3),605andss.,Rubino-Sammartano(2014)(n.3),1351andss.

169

or(ii)inbrief,whetherthesameawardmaybesetasideattheplaceoftheseatofthearbitration.

4.1 ICSID arbitration as a self contained regime and the necessity to find a

solutiontoparallelproceedingswithinitsboundariesThe ICSIDConvention provides for several possible remedies after an award

has been rendered, namely supplementation and rectification of awards (Art. 49),interpretation(Art.50),revision(Art.51)andannulment(Art.52).Asalreadystated,anICSIDawardisnotsubjecttoanyotherappealorremedy(Art.53).5

Amongtheabovementionedremedies,annulment istheonlyonethatmightbringtosetasideanawardissuedwithintheICSIDframework.“Annulmentresultsinthelegaldestructionoftheoriginaldecisionwithoutreplacingit”.6Suchadestruction(whichmayregardonlyawardsoranypart thereofandnotpreliminarydecisions) isoperated by an ad hoc committee composed of three people, appointed by theChairmanofICSIDandchosenfromthepanelofICSIDarbitrators.Inthisregard,itisworthnotingthat“[a]nadhoccommitteeactingundertheICSIDConventionmaynotamendorreplacetheawardbyitsowndecisiononthemerits”,7i.e.annulmentisnotaformofappeal.

AccordingtoArt.52(1),annulmentmayderiveonlyfromlimitedgroundsandnamelythat:

(a)theTribunalwasnotproperlyconstituted;(b)theTribunalhasmanifestlyexceededitspowers;8(c)therewascorruptiononthepartofamemberoftheTribunal;(d)therehasbeenaseriousdeparturefromafundamentalruleofprocedure;

or(e)theawardhasfailedtostatethereasonsonwhichitisbased.9It is questionablewhether, among thesegrounds, there couldbeone that is

helpful inorder toseek for theannulmentofanaward regardingadispute thathasbeenalreadysettledbyaprevious (either ICSIDornon-ICSID)award. In this regard,duetothefactthatthepresentbookhasproposedasolutiontoparallelproceedingsbasedontheapplicationofcertainrulesofinternationallaw,thepossiblegroundfor

5For an analysis of all these remedies, see Wang Dong, Post-Award Remedies, UNCTAD Course onDispute Settlement in International Trade, Investment and Intellectual Property (2003), 7 and ss.Withregard to finality and enforceability of awards, see Wang Dong, Binding Force and Enforcement,UNCTAD Course on Dispute Settlement in International Trade, Investment and Intellectual Property(2003).6WangDong,PostAwardRemedies(2003)(n.5),13.7Ibid.8Schreuer(etal.),TheICSIDConvention:ACommentary(2009),938andss.,haveclearlyexplainedthatthe meaning of the word “manifest” shall be intended as “plain”, “clear”, “obvious”, “evident”.“Therefore themanifest natureof an excess of powers is not necessarily an indicationof its gravity.Rather,itrelatestotheeasewithwhichitisperceived”.9AdetailedanalysisofanyofthesegroundsmaybefoundinSchreuer(etal.)(2009)(n.8),890andss.SeealsoWangDong,PostAwardRemedies(2003)(n.5),17andss.

170

annulment of an ICSID decision resulting from proceedings that are duplicative ofother proceedings shall be related to a failure in the application of the proper law(namely,thegeneralprinciplesofgoodfaithandnebisinidem).

Inthisregard, it isworthnotingthat“[a]lthoughtheWashingtonConventiondoesnotprovideforaspecificgroundforannulmentofarbitralawardsregardingtheissueofapplicable law, ICSIDcaselawhasadmittedthatatribunal’sfailuretoapplythe proper law – as opposed to a mere mistake in the application of the law – issubjecttoreviewunderthemanifestexcessofpowersstandardofArticle52(1)(b)oftheWashingtonConvention”.10Itemergesthatthefailuretoapplytheproperlaw(i.e.the issuanceofadecisionthatdoesnotkeep intoaccountthe lawapplicabletothedisputeaccordingtoArt.42oftheConvention)maybringtoadecisionofannulment,whileanincorrectapplicationoftheproperlaw(i.e.amereerror)isnotconsideredtobeagroundforannulment.11

Giventheabove,Prof.Schreuer(etal.)havestatedthat“[a]generalfailuretoapplyinternationallaw,ifitispartoftheapplicablelaw,wouldamounttoanexcessofpowers exposing the award to annulment. A mere error in the application ofinternational law would not have this effect. (…) [A] non-application of individualprovisionsofinternationallawwouldnot,inprinciple,furnishagroundforannulment.However,acasecanbemadethatcertainfundamentalrulesof international lawdoby themselves form an appropriate and necessary standard for review of awards.These fundamental rulesmay be described as the public policy of the internationalcommunity.Theywouldincludeperemptoryrulesofinternationallaw[i.e.juscogens].(…) It is an open question whether a non-application of other important rules ofinternationallawshouldbeseenasanexcessofpowersforfailuretoapplytheproperlaw.Examplesaretheprinciplesofpactasuntservanda,prohibitionofbadfaithanddenialofjustice,theinternationalminimumstandardforthetreatmentofforeignersand the rules on state responsibility. Itmay be argued that at least some of theseprinciples are so basic to the structure of international law that their disregardamounts toanon-applicationof international lawasawhole.On theotherhand, itmustbeadmittedthatsuchanapproachrunstheriskofblurringthe linebetweenanon-applicationofinternationallawanditserroneousapplication”.12

In light of the above it is self-evident that it is very uncertain (i.e. actuallyunlikely)thatthefailuretoapplygeneralprinciplesofinternationallawsuchasgoodfaithandnebisinidemcanbethebasisfortheexistenceofmanifestexcessofpowersandoftheissuanceofaconsequentdeclarationofannulment.

Such uncertainties increase also in light of the very doubtful function ofannulment in the ICSID framework. In this regard, it is usually said that “Art. 52constitutesaverylimitedexceptiontotheprincipleofthefinalityofawards”.13Itisalso

10Gaillard,AnnulmentofICSIDAwards(2004),236.11Caron,WorldArbitration&MediationReview(2012),183.12Schreuer(etal.)(2009)(n.8),975-976.13WangDong,PostAwardRemedies(2003)(n.5),13.

171

saidthatannulmentisnotaformofappealandshallbelimitedtoananalysisofthelegitimacy of the framework of the arbitral process.14Annulment is not concernedwith the correctness of the decision reached within that framework.15For thesereasons, “[a] number of recent annulmentdecisions havebeen sharply criticizedbyscholars (and others not associated with a particular case) as overly intrusive andundisciplined”.16In this regard, it is worth noting that ad hoc committees have notassumed a constant approach. It is in fact possible to identify four generations ofannulment proceedings, 17 each of them has been characterized by a differentapproachtothequestionofthelimitsofreviewofadhoccommittees:

- thefirstgeneration,representedbytheKlocknerv.Cameroon(I)18andAmco v. Indonesia (I)19ad hoc committees’ decisions has adopted avery broad approach. Indeed, ad hoc committees have in fact re-examinedthemeritsofthedisputebroughtbeforetheTribunals;

- thesecondgeneration,mainly representedby thedecisionof theadhoc committee in MINE v. Guinea20has adopted a more cautiousapproach,statingthatitisnotforadhoccommitteestoexaminetheadequacyoftribunals’reasoning;

- thethirdgeneration,representedbyadhoccommittees’decisions inWena Hotels v. Egypt, 21 Vivendi v. Argentina (I) 22 and CMS v.Argentina,23 has been welcomed for its more balanced approach.Theseadhoccommitteesspecified that theywouldhave intervened

14Indeed,asstatedbyGaillard(2004)(n.10),241,“anadhoccommitteeconstitutedunderArticle52oftheWashingtonConventionshouldbeextremelymindfulofthethinlinebetweenwhatconstitutesanannulmentandwhatconstitutesanappeal,andlimititscontroltothe“manifest”natureofanyexcessofpowers”.SeealsoSchreuer,TheLawandPracticeofInternationalCourtsandTribunals(2011),211andss.15Caron(2012)(n.11),183.16Id.,173.Cheng,BerkeleyJournalof InternationalLaw(2013),236andss.hasstatedthatannulmentproceedingsshouldbedrivenby justiceandnotonlybyfinality.ForthisreasonthisAuthorseemstofosteralessstrictapproachtoannulment.17 Nair, Ludwig, www.lexology.com (2011). This article follows the article written by Schreuer,AnnulmentofICSIDAwards(2004),17andss.,whichidentifiedthefirstthreegenerationsofannulmentandthearticlewrittenbyMarboe,InternationalInvestmentLawforthe21stCentury:EssaysinHonourofChristophSchreuer(2009),200andss.,whichhasexaminedthecaselawbetween2005and2009.Seealso,inthisregard,Friedland,Brumpton,AmericanUniversityInternationalLawReview(2012),727andss.18KlocknerIndustrie-AnlagenGmbHandothersv.UnitedRepublicofCameroonandSociétéCamerounaisedesEngrais,ICSIDCaseNo.ARB/81/2,AdHocCommitteeDecisiononAnnullment,3May1985.19Amco Asia Corporation and Others v. Republic of Indonesia, ICSID Case No. ARB/81/1, Ad hocCommitteeDecisionontheApplicationforAnnulment,16May1986.20Maritime International Nominees Establishment v. Republic of Guinea, ICSID Case No. ARB/84/4,DecisionoftheAdhocAnnulmentCommittee,22December1989.21 Wena Hotels Ltd. v. Arab Republic of Egypt, ICSID Case No. ARB/98/4, Decision (AnnulmentProceeding),5February2002.22CompañíadeAguasdelAconquijaS.A.andVivendiUniversalS.A.v.ArgentineRepublic,ICSIDCaseNo.ARB/97/3,DecisionontheArgentineRepublic’sRequestforAnnulmentoftheAward,3July2007.23CMSGasTransmissionCompanyv.TheRepublicofArgentina, ICSIDCaseNo.ARB/01/8,Decisionofthe AdHoc Committee on the Application for Annulment of the Argentine Republic, 25 September2007.

172

onlyinseriousandimportantcasesandcouldnotanywayre-examinethemerits;

- finally,thefourthgeneration,representedbytheadhoccommittee’sdecisions inSemprav.Argentina,24Enronv.Argentina25andHelnanv.Egypt,26has generated some concerns because have lowered thethreshold of review in annulment proceedings and have, one moretime,infactre-examinedthemeritsofthedispute.

Inlightoftheabove,itisself-evidentthat,untilitwillbenotclarifiedhowdeepcanbethemarginofreviewofadhoccommitteesinICSIDannulmentproceedings,itwill not be possible to understandwhetherad hoc committees could play a role inlimiting the effects of parallel proceedings.27In the present legal framework, theanswerseemstobenegative.

4.2 Non-ICSID investment arbitration and possible remedies to parallel

proceedingsattheenforcementandsetasidestagesofarbitralawards4.2.1 The regime of the 1958 New York Convention and the possible

applicability of the public policy exception to avoid the enforcement ofduplicativeawards

The 1958 New York Convention on the Recognition and Enforcement of

ForeignArbitralAwardsisoneofthemostsuccessfultreatiesintheworld;indeed,asof today, ithasbeenenforcedby156States.TheNewYorkConvention isprobablyoneofthemainreasonsofthepopularityofinternationalarbitrationasamethodofdispute settlement and has created a pro enforcement regime, according towhichenforcement of arbitral awards “should be refused only in exceptionalcircumstances”.28Indeed,assetforthinArt.IIIoftheConvention,thebasicobligationarising from the Treaty is the following: “[e]ach Contracting State shall recognizearbitralawardsasbindingandenforcetheminaccordancewiththerulesofprocedureoftheterritorywheretheawardisreliedupon,undertheconditionslaiddowninthefollowingarticles.Thereshallnotbe imposedsubstantiallymoreonerousconditionsorhigherfeesorchargesontherecognitionorenforcementofarbitralawardstowhich

24Sempra Energy International v. TheArgentine Republic, ICSIDCaseNo.ARB/02/16,Decision on theArgentineRepublic’sApplicationforAnnulmentoftheAward29June2010. 25Enron Corporation and Ponderosa Assets, L.P. v. Argentine Republic, ICSID Case No. ARB/01/3,DecisionontheApplicationforAnnulmentoftheArgentineRepublic,30July2010.26HelnanInternationalHotelsA/Sv.ArabRepublicofEgypt,ICSIDCaseNo.ARB/05/19,DecisionoftheAdHocCommittee,14June2010.27Indeed,thelackofconsistencyandtheunforeseeabilityofthedecisionsofadhoccommitteesisoneof the reasons why some commentators have proposed to reform the whole ICSID system. Thecriticisms and the proposals of reform may be found in Schreuer,http://www.univie.ac.at/intlaw/wordpress/pdf/99_rev_invest_awards.pdf(2009),1andss.andinTams,http://telc.jura.uni-halle.de/sites/default/files/altbestand/Heft57.pdf(2006),1andss.28InternationalLawAssociation,FinalReportonPublicPolicyasaBar toEnforcementof InternationalArbitralAwards,NewDelhiConference(2002),Recommendation1(a).

173

this Convention applies than are imposed on the recognition or enforcement ofdomesticarbitralawards”(emphasisadded).

The only exceptions to such an obligation are set forth in Art. V of theConvention,accordingtowhich:

1.Recognitionandenforcementoftheawardmayberefused,at

therequestofthepartyagainstwhomitisinvoked,only ifthatpartyfurnishes to the competent authority where the recognition andenforcementissought,proofthat:

(a)Theparties to theagreement referredto inarticle IIwere,underthelawapplicabletothem,undersomeincapacity,orthesaidagreement is not valid under the law to which the parties havesubjected it or, failing any indication thereon, under the law of thecountrywheretheawardwasmade;or

(b)Thepartyagainstwhomtheawardisinvokedwasnotgivenpropernoticeoftheappointmentofthearbitratororofthearbitrationproceedingsorwasotherwiseunabletopresenthiscase;or

(c)Theawarddealswithadifferencenotcontemplatedbyornot falling within the terms of the submission to arbitration, or itcontainsdecisionsonmattersbeyondthescopeofthesubmissiontoarbitration, provided that, if the decisions on matters submitted toarbitrationcanbeseparatedfromthosenotsosubmitted,thatpartofthe award which contains decisions on matters submitted toarbitrationmayberecognizedandenforced;or

(d) The composition of the arbitral authority or the arbitralprocedurewasnot inaccordancewith theagreementof theparties,or,failingsuchagreement,wasnotinaccordancewiththelawofthecountrywherethearbitrationtookplace;or

(e) The award has not yet become binding on the parties, orhas been set aside or suspended by a competent authority of thecountryinwhich,orunderthelawofwhich,thatawardwasmade.

2.Recognitionandenforcementofanarbitralawardmayalsobe refused if the competent authority in the country whererecognitionandenforcementissoughtfindsthat:

(a) The subject matter of the difference is not capable ofsettlementbyarbitrationunderthelawofthatcountry;or

(b) The recognition or enforcement of the award would becontrarytothepublicpolicyofthatcountry(emphasisadded).FromareadingofArt.V,andasconfirmedfromananalysisofthepreparatory

174

works,29it emerges that thedraftersof theConventiondidnotanalyse the issueofparallel proceedings. There is no express ground for refusing the enforcement ofawardsthatareinfactduplicativeofanalreadyexistingenforcedaward.

Theonlypossible solution is, therefore, to refer to thegeneral clauseofArt.V(2)(b), namely the public policy exception. However, it is well known that publicpolicyhas“unclearboundariesand[is]subjecttodifferentinterpretationsindifferentjurisdictions”.30In Richardson v. Mellish,31public policy has been defined as “a veryunrulyhorse,andonceyougetastrideityouneverknowwhereitwillcarryyou.Itmaylead you from sound law”. Similarly, Arfazadeh has defined public policy as a“chameleon”.32

Themost convincing definition of public policy has been provided by Lew,33accordingtowhompublicpolicyrepresents“thefundamentaleconomic,legal,moral,political, religious and social standardsof every stateor extra-national community.Naturally,publicpolicydiffersaccordingtothecharacterandstructureofthestateorcommunity towhich it appertains, and covers thoseprinciples and standardswhicharesosacrosanctastorequiretheirmaintenanceatallcostsandwithoutexception”.Asaconsequence,“publicpolicyconsistsinactingasalimit(…)totherecognitionofforeign judgments and awards” (emphasis in original).34In this regard, it is worthclarifying that, when referring to the public policy exception in the New YorkConvention, we refer to the concept of international public policy, i.e. “issues ofdomestic public policy that the country feels so strongly about as to insist that[international] transactionsorawardsthathaveaconnectionwiththecountrymustconformwith”.35

Thisconceptismorerestrictedthantheconceptofdomesticpublicpolicy(i.e.the most important social, legal and political values that have to be respected ininternaltransactions);thisisduetothecircumstancethatinternationalpublicpolicyisrelated to the needs of international commerce and, therefore, shall lead to non-enforcementonly inexceptionalcircumstances.However, internationalpublicpolicyis a different concept also with regard to the so-called transnational (or trulyinternational) public policy, the scope of application ofwhich is even stricter.36Thisconcept has been developed mainly by Prof. Pierre Lalive and refers to “certainsuperior and fundamental norms or principles essential in the law of international

29PublishedinGaja,InternationalCommercialArbitration–NewYorkConvention,Oceana,1978-96.30Lo,ContemporaryAsiaArbitrationJournal(2008),70.311824WL2555(CCP),(1824)2Bing.229,[1824]AllE.R.Rep.258,130E.R.294.32Arfazadeh,TheAmericanReviewofInternationalArbitration(2003),43.33Lew,ApplicableLawinInternationalCommercialArbitration(1978),532.SeealsoLew,Mistelis,Kroll,InternationalandComparativeCommercialArbitration(2003),422andss.34Rubino-Sammartano,InternationalArbitrationLawandPractice(2014),721.SeealsoFeraci,L’ordinepubbliconeldirittodell’Unioneeuropea(2012),7andss.35 Okekeifere, International Arbitration Law Review (1999), 71. See, in this regard, Atteritano,L’enforcement delle sentenze arbitrali del commercio internazionale (2009), 329 and ss., Blackaby,Partasides,Redfern,Hunter(2015)(n.3),641andss.,Lew,Mistelis,Kroll(2003)(n.3),720andss.36SeeLo(2008)(n.30),84andss.

175

trade”.37Such principles and norms (such as, the rules against corruption, privacy,slaveryandviolationofhumanrights,aswellasgeneralprinciplesasgoodfaith,pactasunt servanda and the prohibition of discriminations)38should be, according to thescholarswho accept the existence of transnational public policy, always applied byinternational arbitrators and should be the main parameter in order to apply Art.V(2)(b)oftheNewYorkConvention.

Forthesakeofthepresentbook,itisinterestinglytounderstandwhethertheprinciplesofgoodfaith(andabuseofprocess)andfinality(i.e.nebisinidem)maybeconsidered, ingeneralterms,aspartofthe internationalpublicpolicyofStates. It isobviouslyimpossibletogiveacompletepictureofpublicpolicyinallStates;however,wewillrefer,firstly,totheILARecommendationsonInternationalPublicPolicy39andonLisPendensandResJudicataandArbitration40and,then,tosomesignificantlegalsystems. In particularwewillmake reference to the concept of public policy in theEuropeanUnion and in someexemplary commonand civil law systems. Finally, forthe sake of completeness, we will try to ascertain whether good faith and finalitymightbeconsideredaspartoftransnationalpublicpolicy.

ILARecommendationsStartingfromtheILARecommendations,asapreliminaryremark,itshouldbe

notedthat theyarenotanywaybinding fornational judgesorarbitrators.Theyare,indeed,anauthoritativesoft-lawtoolaimedatofferingguidancetopractitionersanddecisionmakers.

WithregardtogoodfaithitisworthnotingthatRecommendation1(e)oftheRecommendationsonInternationalPublicPolicyexpresslystatesthat“[a]nexampleofa substantive fundamental principles is prohibition of abuse of rights”. Consideringthat,asalreadyexplainedinChapter3,abuseofrightsisanexpressionofthegeneralprincipleofgoodfaith, itseemspossibletosaythatgoodfaith is– in ILA’sview–aruleofpublicpolicy.Duetotheobviouslinksbetweengoodfaith,abuseofrightsandabuseofprocess,itmightbeconcludedthat–intheILA’sview–theenforcementanawardwhichistheresultofanabuseofprocess,beingsuchanawardalsoanabuseofrights,couldberefused.

Moving to the principle of ne bis in idem, it is quite surprising to find thatRecommendationN.7of theFinalReportonResJudicataandArbitration statesthat“[t]hepreclusiveeffectsofanarbitralawardneednotberaisedonitsownmotionbyanarbitral tribunal. If not waived, such preclusive effects should be raised as soon aspossible by a party” (emphasis added). Even if such a recommendation refers to

37Lalive, ICCACongressSeriesNo.3 (1986),286.Theconceptoftransnationalpublicpolicyhasbeenoftencriticizedforitsmurkyboundaries.SeeFeraci(2012)(n.34),24,accordingtowhomitisnoteasytounderstandwhichprinciplesandrulesshouldbeconsideredaspartoftransnationalpublicpolicy.38SeeFeraci(2012)(n.34),25.39Seesuprafootnote28.40InternationalLawAssociation,FinalReportonLisPendensandResJudicataandArbitration,TorontoConference(2006).SeealsoInterimReport:“ResJudicata”andArbitration,BerlinConference(2004).

176

arbitrators(andnottonationalcourts),keeping intoaccountthatArt.V(2)(b)oftheNewYorkConventionprovidesthatpublicpolicyexceptionscanberaisedexofficiobynationalcourts,itseemsthattheILAhasnottreatedfinalityasaruleofpublicpolicy.However,asalreadystatedbyotherAuthors,41fromadeeperanalysisitispossibletosay that such a conclusion is not convincing and that the ILA Recommendationsprovide for a different solution. Indeed, Recommendation 1(d) of theRecommendations on International Public Policy states that “[t]he internationalpublicpolicyofanyStateincludes:(i)fundamentalprinciples,pertainingtojusticeormorality,thattheStatewishestoprotectevenwhenit isnotdirectlyconcerned;(ii)rulesdesignedtoservetheessentialpolitical,socialoreconomicinterestsoftheState(…)”. In this regard, it has been noted that finality is an essential value in order topreservejusticeandtoserveessentialsocialandeconomicinterestsofaState.Thisisfurther confirmedby the InterimReportonRes Judicata,where the same ILAstatedthat“resjudicata(…)pertainsbothtopublicpolicyandtoprivatejustice”.42Inlightoftheabove,“onewouldassumethattheinterestsofarbitralfinalityandjusticewouldalsoqualifyaspublicpolicy”.43Hence,itwouldseemthattheILARecommendations,ifapplied,wouldsuggestanationaljudgetorefusetheenforcementofaduplicativearbitrationawardbyapplyingthepublicpolicyexception.

EuropeanUnionIt has been recently demonstrated that the concept of public policy has

acquiredautonomousstandingandmeaningwithintheframeworkofEuropeanUnionlaw.44This is confirmed by a Communication of the Commission of 14 July 1998,entitled “Towards an Area of FreedomSecurity and Justice” inwhich it was statedthat“[i]tisintheframeworkoftheconsolidationofanareaoffreedom,securityandjusticethattheconceptofpublicorderappearsasacommondenominatorinasocietybasedondemocracyandtheruleoflaw.WiththeentryintoforceoftheAmsterdamTreaty,thisconceptwhichhashithertobeendeterminedprincipallybyeachindividualMember State will also have to be assessed in terms of the new European area.IndependentlyoftheresponsibilitiesofMemberStatesformaintainingpublicorder,wewillgraduallyhavetoshapea"Europeanpublicorder"basedonanassessmentofsharedfundamentalinterests”(emphasisadded).45TheconceptofEuropeanpublicorder(i.e.Europeanpublicpolicy)isfunctionaltoreachthegoalsoftheEuropeanUnion,whichinvolve, inter alia, for what is of interest in this book, harmony and coherence ofjudicialdecisions.

41See,interalia,Ma,ContemporaryAsiaArbitrationJournal(2009),70andss.42SeeILA(2004)(n.40),25.43SeeMa(2009)(n.41),71.44Feraci(2012)(n.34),78andss.45 The whole communication is available at http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=COM:1998:0459:FIN:EN:PDF.Feraci(2012)(n.34),79hasperfectly explained that the concept of European public order shall be intended as a synonym ofEuropeanpublicpolicy.

177

In the well-known EcoSwiss decision,46the Court of Justice of the EuropeanUnionhasclarifiedthat,evenwhenenforcingforeignarbitralawardsaccordingtotheNewYorkConvention,MemberStates have to respect Europeanpublic policy.Thismeans that national judges of the member States, when enforcing an internationalarbitral award, have to ascertain that such an award does not run against the publicpolicyoftheEuropeanUnion,duetothefactthatEuropeanUnionLawispartofnationallawof theMemberStates.The contentofEuropeanpublicpolicymaybe foundoutboth by the European treaties (and other written sources of law) and by generalprinciplessetforthinrelevantdecisionsoftheCourtofJustice.

Withregardtogoodfaith,ithasbeendemonstratedthat,bothonthebasisoflegalsourcesandonthebasisofthecaselawoftheCourtofJusticeoftheEuropeanUnion,theprohibitionofabuseofrighthasgraduallyemergedasageneralprincipleofEuropeanUnionlaw.47However, itdoesnotseempossibletosaythatinEUlawaprincipleofpublicpolicymilitatesagainst theenforcementofarbitral awardswhicharetheresultofanabuseofprocess.Suchaconclusion isduetotwomainreasons:firstofall, ingeneralterms,ithasneverbeenstatedthattheprohibitionofabuseofrightsisaprincipleofpublicpolicyofEUlaw;and,secondly,becausethereisnocaselaw or scholars’ work suggesting such a conclusion. Hence, it seems that theenforcementofaduplicativearbitrationawardcannotberefusedonthebasisofanallegedpublicpolicyprovidingfortheprohibitionofabuseofrights/process.

Movingtotheprincipleoffinality,itisworthnotingthatinItalianLeathertheCourt of Justice of the European Union has expressly stated that “as stated in theJenardReportontheBrusselsConvention(OJ1979C59,p.1,atp.45),'therecanbenodoubt that the rule of law in a State would be disturbed if it were possible to takeadvantage of two conflicting judgments’” (emphasis added).48This has been furtherconfirmedbyotherdecisionsandbyscholars’opinion.49

Thus,itseemspossibletoconcludethattheprincipleofnebisinidem–beingaprinciple ensuring consistency and legal certainty, as well as harmony betweendecisionsinvariousMemberStates–mightbeconsideredasaprincipleofEuropeanpublicpolicy.ThishasbeenexpresslyconfirmedbytheCourtofJusticebythealreadymentionedEcoSwisscase.50Inthisregard, it isworthnotingthatEuropeanlaw,caselawandscholarsonlyrefertotheprincipleofclaimpreclusionandnevertocollateralestoppel.Thelatter,beingaprincipleappliedonlyincommonlawcountries,hasnotbeen–asoftoday–takenintoconsiderationinEuropeanUnionlaw.

46EcoSwissChinaTimeLtdvBenettonInternationalNV,CaseC-126/97,Rep.1999I-03055,Judgmentof1June1999.See,inparticular,par.38ofthedecision.TheapproachfosteredinEcoSwisshasbeenthenappliedinanumberofnationaljudgmentsmentionedinFeraci(2012)(n.34),185.47See Gestri, Abuso del diritto e frode alla legge nell’ordinamento comunitario (2003), 197 and ss.,Losurdo,Ildivietodell’abusodeldirittonell’ordinamentoeuropeo(2011),123andss.48ItalianLeatherSpAvWECOPolstermöbelGmbH&Co.,CaseC-80/00,Rep.2002I-04995,Judgmentof6June2002,par.48.49SeeTonolo,Rivistadidirittoprocessuale(2008),1277andss.50See the abovementioned EcoSwiss decision, par. 43 and ss. (and in particular par. 48). See alsoMuroni,Rivistadell’arbitrato(2000),761.

178

Inconclusion,inlightofwhathasbeenstatedinEcoSwiss,theenforcementofaduplicativearbitrationawardmightberefusedbyanationaljudgeonthebasisofresjudicata, being this principle part of the European concept of international publicpolicy.

Commonlawsystems“The principle of abuse of rights is not so readily apparent in common law

systems”.51InEnglish law this is traditionallydue to the circumstance that therewasno

generalrecognitionoftheprincipleaccordingtowhichrightshavetobeexercisedingoodfaith.52However,ithasbeennotedthattodaythingshavegraduallychanged,sothat some Authors have said that English courts are now often applying doctrineswhichare,intheircontent,analogoustotheprincipleofabuseofrights.53Similarly,aswehavealreadyseen,Englishcourtsusuallyapplythedoctrineofabuseofprocess.54However, it isnotpossibletosaythatageneralprincipleprohibitingabuseofrights(and/orabuseofprocess)hasemergedinEnglishlaw.55

Similarly, with regard to US law, Prosser wrote that "[i]n all but a fewjurisdictions, it is now settled that where the defendant acts out of puremalice orspite,asbyerectingafenceforthesolepurposeofshuttingofftheplaintiff'sview,ordrilling a well to cut off the plaintiff's underground water [...] such conduct isindefensiblefromasocialpointofview,andthereisliabilityfornuisance".56Hence,itiscommonlysaidthatalsoUSlawrecognizessomeformsofabuseofrights(namelynuisance)but,inlightoftheavailablecaselaw,itisnotpossibletosaythatageneralprincipleemergedinthisregard.57

Itfollowsthat,duetotheuncertaintyintheapplicationofthenotionsofgoodfaithandabuseofrightsincommonlawsystems,itisobviouslyimpossibletosaythatsuch principles (aswell as the related doctrine of abuse of process)may constitutepartoftheinternationalpublicpolicyofthesecountries.

Moving to the principle of finality (that, in common law systems, shall beintendedbothasclaimandissuepreclusion),thesituationisdifferent.

With regard to English common law, it is usually stated that finalitymay beconsideredaspartofinternationalpublicpolicy.SuchaconclusionissupportedbothbyAuthorsandbythecaselaw.58Asaconsequence,accordingtosuchanapproach,

51Byers,McGillLawJournal(2002),395.52Gestri(2003)(n.47),46.53SeeByers(2002)(n.51),395,Gestri(2003)(n.47),47andss.,Losurdo(2011)(n.47),33andss.54SeeParagraph3.5above.SeealsoILAInterimReport(2004)(n.40),8.55Losurdo(2011)(n.47),33.56Prosser,LawofTorts(1964),618-19.57Australiahasrecognizedadoctrineofabuseofprocessbuttheprincipleofabuseofrightshasneverbeendirectlyemployed.See,inthisregard,Byers(2002)(n.51),396.58See ILA Interim Report (2004) (n. 40), 7, and He, Hong Kong Law Journal (2013), 1055. See alsoVarvaekev.Smith, [1983]1AC145;ED&FMan (Sugar)Ltd.v.Haryanto (No.2), [1991]1Lloyd’sRep429.

179

national courtswould be entitled also to raise ex officio the res judicata defence aspart of the public policy exception set forth in Art. V(2)(b) of the New YorkConvention.

ConcerningUScommon law itseemspossible togatherasimilarconclusion.Indeed, the First Restatement on Judgments, at par. 1, already talked about “thepublicpolicyofputtinganend to litigation”;59in this regard, ithasbeenalsostatedthat “if a judgment [is] not conclusive as to what it actually determined, theadjudicativeprocesswould fail toserve its social functionof resolvingdisputes”.60Aclaimantshallnohavemorethanafullandfairopportunityfor judicial resolutionofthesamedispute.61Indeed,theUSSupremeCourthasclarifiedthatres judicata (i.e.both claim preclusion and issue preclusion) may be raised ex officio by a court ofcompetent jurisdiction.62Hence, also in US law, the enforcement of a duplicativearbitralawardmayberefusedbyapplyingthepublicpolicyexceptionprovidedintheNewYorkConvention.

Thesamehasbeenalsosaidwith regardto the Indiansystem63and it seemsthatasimilarconclusionhasbeenrecentlyreachedalsoinHongKong.64

CivillawsystemsCivil lawsystemslargelyrecognizetheprincipleofgoodfaithandtherelated

doctrineofabuseofrights.Severalnationallawsexpresslyrecognizetheexistenceofgood faith and/or abuse of rights, namely Germany,65Greece,66Portugal,67Spain68and The Netherlands.69In other systems, such as France, Belgium and Italy, theseprincipleshavebeenrecognizedbywayof judicialdecisions.70However, thepresentauthorhasnotbeenabletofindanystatementdeclaringthatsuchprinciples(aswellas the related doctrine of abuse of process) are to be considered part of suchCountries’ international public policy. It is therefore not possible to say that theenforcementofaduplicativearbitralawardmightberefusedaccordingtoArt.V(2)(b)of the New York Convention by applying the abuse of process doctrine. The only

59SeealsoGottlieb,CaliforniaLawReview(1978),1099.60Currie,TheUniversityofChicagoLawReview(1978),325.61SeeBlonder-TongueLaboratories,Inc.v.UniversityofIll.Foundation,402U.S.313,328(1971).62SeeArizona v. California, 530U.S. 392, 412 (2000). See alsoMartinez-Fraga, Samra,NorthwesternJournalofInternationalLawofBusiness(2012),428-429.63SeeHe (2013) (n. 58), 1055.SeealsoRenusagarPowerCo.Ltd. v.GeneralElectricCo.,AIR1994SC860.64SeeAstroNusantaraInternationalB.V.v.PTFirstMediaTBKHCCT45/2010.65Seepar.242oftheBGB.66SeeArt.281oftheGreekCivilCode.67SeeArt.334ofthePortugueseCivilCode.68See Art. 7 of theTítulo Preliminar to the Spanish Civil Code. See also the decision of theTribunalSupremoissuedon14February1944(R.293).69SeeArt.13ofthethirdbookoftheDutchCivilCode.70SeeGestri(2003)(n.47),40andss.,Losurdo(2011)(n.47),25andss.WithregardtoItalyitispossibletosaythatthecaselawhasgraduallyappliedalsothedoctrineabuseofprocess.SeeScarselli,Rivistadidiritto processuale (2012), 1450 and ss., Comoglio, Rivista di diritto processuale (2008), 319 and ss.,Cordopatri,Rivistadidirittoprocessuale(2012),874andss.

180

exception to what has been just stated seems to be Switzerland. As reported byEinhorn, 71 the Swiss Supreme Court has stated that “an award is contrary tosubstantivepublicpolicywhenitviolatesfundamentalprinciplesoflawtothepointofnotbeingreconcilablewitha juridicalorderofbasicvalues, includingprinciplessuchassanctityofcontract,respectfortheprincipleofgoodfaith,forbiddingl’abusededroit,prohibiting discriminatory or exploitative measures, and protecting vulnerablepersons” (emphasis added).72This would seem to allow to include good faith andabuseofrights(andprocess)withintheSwissconceptofinternationalpublicpolicy.

Movingtotheprincipleoffinality,thatincivil lawcountriesshallbeintendedonly as claim preclusion (due to the inapplicability of collateral estoppel thesesystems),itispossibletosaythatseveralcivillawsystemsconsiderresjudicataaspartof their public policy. This can be said with certainty with regard to the German,73Swiss,74Egyptian75andHungarian76system.Itseemsthatasimilarconclusioncanbedrawn,today,alsowithregardtoFrance77andItaly.78Onthecontrary,inBelgiumand71SeeEinhorn,YearbookofPrivateInternationalLaw(2010),50.72XSpAv.YSrl,BGE132III,389,8March2006,mentionedinEinhorn(2010)(n.71),50.73Koch,Diedrich,CivilProcedureinGermany(1998),70.SeealsoILAInterimReport(2004)(n.40),15.74See Swiss Federal Supreme Court, 3 April 2002, ATF 128 III 191; see also Swiss Federal SupremeCourt,27May2015,4A_374/2014;ClubAtléticodeMadridSADv.SportLisboaEBenficaandFédérationInternationaledeFootballAssociation (FIFA),TribunalFederal,23April2010,4A_490/2009.Finallyseethewell-knowncaseoftheSwissFederalSupremeCourtFomentodeConstruccionesyContratasS.A.v.ColonContainerTerminalS.A.,DSFSC127(2001)IIIat279.InthisregardseealsoSöderlund,JournalofInternationalArbitration(2007),311-312.75SeeArt.58(2)(a)oftheLawConcerningArbitrationinCivilandCommercialMatters.76See Legefelsöbb Biróság (LB) [Supreme Court] BH.2010.191, mentioned in Walters, Journal ofInternationalArbitration(2012),669.77TraditionallyresjudicatawasnotconsideredaspartofpublicpolicyinFrance.SeeILAInterimReport(2004)(n.40),15.Adifferentconclusionmaybe,however,drawnbyreadingthedecisionMarriottInt’lHotels, Inc.v. J.N.A.H.Dev.S.A.,no.09/13559,Courd’appeldeParis,9September2010,where ithasbeen stated that res judicata could createabasis toannulor refuseenforcementof anawardundersection1502(5)oftheFrenchCodeofCivilProcedure,whichprovidesforannulmentofanawardthatiscontrarytointernationalpublicpolicy.Thecourtexpresslyexplainedthatsuchasituationwouldariseifasecondarbitralawardcontradictsapreviousarbitralawardthat isenforceableinFrance.Seeinthisregard,Walters(2012)(n.76),665-666.Inthisregard,itisworthnotingthatsinceJanuary2005Art.125oftheFrenchCodeofCivilProcedurehasbeenmodified,onthebasisofconsiderationsofproceduraleconomyandefficiency,anditnowallowscourtstoconsiderresjudicata issuesexofficio.Thereisno,however,obligationsfornationalcourtstodoso.Theenforcementofaduplicativearbitrationawardcontrary to theprincipleofres judicatahas takenplacealsointhewell-knownHilmartoncase.SeeSociétéOTVv.SociétéHilmarton,CourdeCassation,10June1997,in6Rivistadell’arbitrato(1997),385andss.78SeeItalianCortediCassazione13475/2014and26482/2007inwhichithasbeenexpresslystatedthatres judicatamay be raised ex officio by judges. Considering that res judicata is already a ground forrefusing theexecutionof foreigndecisions according toArt. 64of Italian law218of 1995onprivateinternational law, it seems possible to say that Italian judges may raise ex officio the res judicataexception (as part of Italian international public policy) when enforcing a foreign arbitral awardaccording to theNewYork Convention. Such a conclusion could seem to be denied by the decisionTema-Frugoli S.p.a. c. Hubei SpaceQuarry Industry Co. Ltd. of 2 July 1999 of the Court of Appeal ofMilan, in 9 Rivista dell’arbitrato (2000), 753 and ss. However, in this case, the party opposing theenforcementoftheduplicativeawarddidnotraisethepublicpolicyexception;forthisreasonitisnotpossible to say that this award runs against the opinion fostered by the present author. See, in thisregard,Muroni(2000)(n.50),755andss.,who–at761–hasexpresslystatedthatinItalycourtsshallexofficio refuse enforcement of duplicative arbitral awards, which shall be considered contrary to

181

TheNetherlandsres judicatashallberaisedbyapartyandnotbyacourtonitsownmotionandthishasleadsomecommentatorstorefusetheideathatresjudicatamaybepartofinternationalpublicpolicy.79

It seems, in conclusion, that res judicata may be considered as part ofinternational public policy of several civil law systems. In such systems, therefore,national courts may refuse the enforcement of a duplicative arbitration award byapplying the public policy exception set forth in Art. V(2)(b) of the New YorkConvention.80

TransnationalpublicpolicyIt isfinally interestingtounderstandwhethergoodfaithandfinalitycouldbe

consideredaspartofpublicpolicyincaseajudgewouldapplythealreadydiscussedconceptoftransnationalpublicpolicy.

Inthisregard,itisworthnotingthat,inhisseminalworkonthesubject(whichhasinspiredallthesubsequentworksinsubiectamateria),PierreLalivehasstatedthatgood faith and abuse of rights are to be considered as part of transnational publicpolicy,buthenevermentionedthelargelymorerecognizedprincipleoffinality.81Thisseems surprising,due to theveryhigh importance that theprincipleof finalitymayhaveinensuringlegalcertaintyinanidealsystemoftransnationalcommerce.

However,itisworthnotingthat–asoftoday–transnationalpublicpolicyhasbeen a concept of academic rather than practical interest (and application). As aconsequence, the above classification is not very helpful in offering guidelines tonationalcourtsfacingthesituationoftwoduplicativearbitralawards.

4.2.2 ConcreteapplicationoftheproposedsolutionIn order to understand how could the public policy exception operate in

concrete inorder toprevent theenforcementofduplicativearbitrationawards, it isnecessarytoproceedonacase-by-casebasis.Wewill,firstofall,distinguishbetweencasesinwhichonlyone(oftwoormore)parallelarbitrationshasbeenconcludedandcases inwhich there are two (ormore) validly rendered awards.Within this secondcategory,itwillbethennecessarytoidentifyseveralothersub-categories.

Hypothesis1:oneawardandonependingprocessIf there is an award and a pending proceeding (perhaps commenced earlier

internationalpublicpolicy. Indeed,accordingtothisAuthor,nebis in idem istobeconsideredpartofinternationalpublicpolicyintheItalianlawsystem.79ConcerningBelgiumandTheNetherlandsseeILAInterimReport(2004)(n.40),15.80However, it is worth remembering that in all systems which are part of the European Union theenforcementofaduplicativearbitrationawardmayberefusedonthebasisoftheEuropeanconceptofinternationalpublicpolicy;withregardtothesecountries,itisthereforeirrelevantwhetherthenationallawsconsider(ornot)finalityaspartoftheirinternationalpublicpolicy.81SeeLalive(1986)(n.37),305.

182

than the process which lead to the rendered award), the question is whether anational court may refuse enforcement of the already rendered award due to theexistenceofanotherprocessonthesamedispute.Theanswer,inthemajorityofthecases,seemsquitestraight:no.Has ithasbeenstated,“parallelproceedingsdonotobstruct the enforcement of a divergent judgment. Therefore judges (…) willgenerallyenforceajudgmentsdespitetheexistenceofparallelproceedingsinathirdcountry”.82Thisisduetothefactthatitisunlikelythatacountrywouldincludethelispendens rulewithin its internationalpublicpolicy.A recourse toabuseofprocessaspartof internationalpublicpolicyofacountry is,aswehavealreadydemonstrated,quitelimited(i.e.,aswehaveseen,itseemsthatonlyinSwitzerlandanapplicationofthedoctrineaspartofinternationalpublicpolicyisallowed).Similarly,theapplicationofcollateralestoppelmightatmostregardtheissuesthathavealreadybeendecided(bymeans of an interlocutory award) in the pending arbitration; however, such anapproach seemsapplicableonly in theUS,where – aswehave seen inChapter 3 –collateralestoppelisapplicableeveninlackofafinaljudgmentonthemainclaim.

Asithasbeennoted,“[t]hislegalisticstandpointisunsatisfactory”.83However,itdoesnotseemthatthecurrentlegalframeworkoffersdifferentsolution.

Hypothesis2:twovalidlyissuedawardsIn case there are two validly issued awards, the public policy exceptionmay

fullyoperate.Obviously, theapplicabilityof suchexceptionwill dependonwhethereverysingleStateconsiders res judicata, collateralestoppelandabuseofprocessaspart of its public policy and, with regard to the applicability of res judicata andcollateralestoppel,onhowbroadlythetripleidentitytestisappliedinacountry.Thebroaderistheapplicationofthetripleidentitytestinacountry,thegreaterwillbethepossibilitythattheenforcementofaduplicativeaward is refusedonthebasisofresjudicataandcollateralestoppel.

Somesub-categorizationsarerequired.WewillfirstofalldistinguishthecasesinwhichthefirstawardisanICSIDawardandthecasesinwhichthefirstawardshallbeenforcedaccordingtothe1958NewYorkConvention.Withinthislastcategory,wewill distinguish the cases inwhich the first awardhasbeen recognized, enforcedorconfirmedat theStateof the seat, from the cases inwhich the first awardhas notbeen recognized, enforced or confirmed. A final distinction shall be made for thecasesinwhichthefirstawardhasbeenrecognized,enforcedorconfirmed:therearedifferencesonthebasisofwhetherthefirstawardhasbeenrecognized,enforcedorconfirmedinthesamecountrywheretheenforcementofthesecondawardissought,orthefirstawardhasbeenenforced(orconfirmed)inacountrythatisdifferentfromtheonewhereenforcementofthesecondaward issought.Finally, thehypotheticalcaseinwhichthefirstnon-ICSIDawardhasbeenannulledinthecountryoftheseatwillbeanalysed.

82SeeBalkanyi-Nordmann,AAAHandbookonInternationalArbitrationandADR(2010),179.83Ibid.

183

Hypothesis2.1:thefirstissuedawardisanICSIDawardIf the first issued award is an ICSID award, according to Art. 54 of the 1965

WashingtonConvention“[e]achContractingStateshallrecognizeanawardrenderedpursuanttothisConventionasbindingandenforcethepecuniaryobligationsimposedby that award within its territories as if it were a final judgment of a court in thatState”.ThismeansanICSIDawardisfullyeffectiveandenforceableinallStateswhicharepartiesoftheICSIDConvention.Asaconsequence,theenforcementofasecond(non-ICSID)awardmayberefusedinalltheseStatesonthebasisofthepublicpolicyexception, provided that such States recognize one or more of the res judicata,collateral estoppel and/or abuse of process doctrines as part of their internationalpublicpolicy.

Hypothesis2.2:thefirstissuedawardisnotanICSIDawardAsalreadystated,thishypothesisrequiresafurtherdistinction,onthebasisof

whetherthefirstawardhasbeenrecognized,enforcedorconfirmedornot.Hypotesis 2.2.1: the first non-ICSID award has been recognized, enforced or

confirmedIf thefirstnon-ICSIDaward isenforced,recognizedorconfirmedinthesame

countrywhere theenforcementof thesecondaward is sought, in this case the firstaward will be probably considered as merged in the judgment thatrecognized/enforced/confirmedit.Thismeansthattheawardwillbeconsideredasastate judgment, which can preclude a second discussion on claims/issues alreadydiscussed in the firstarbitrationanddecided in the firstaward.For this reason (andalso by applying an analogywith national rules on recognition and enforcement offoreign judgments) it seems likely that in all States where res judicata, collateralestoppeland/orabuseofprocessareconsideredaspartofinternationalpublicpolicy,theenforcementofthesecondduplicativeawardwillbeprecluded.

Ifthefirstnon-ICSIDawardisrecognized,enforcedorconfirmedinacountrythatisdifferentfromtheonewheretheenforcementofthesecondawardissought,thesituationappearsmorecomplex.Whentheenforcementof thesecondaward issought, the opposing partymay try to oppose the circumstance that there alreadyexists an award on the same dispute and that such award has been merged in aforeign judgment (i.e. the judgment recognizing, enforcing and/or confirming theaward in another country) on the same dispute. At this point, the second nationalcourt may, on the basis of its rules on recognition and enforcement of foreignjudgments,aswellasonthebasisofconsiderationsofcomity,recognizetheforeignjudgment(recognizing,enforcingorconfirmingthefirstaward)andgiveitpreclusiveeffects.84However, it should be noted that such a possibility, that has been called

84InthisregarditisworthnotingthattheEURegulation1215/2012regarding,interalia,enforcementofforeign judgments within the EU does not apply to matters related to arbitration, i.e. also to the

184

“judgmentroute”ofarbitralawards,iscontestedbysomeAuthorsonthebasisofthefactthatanationaljudgmentbasedonanarbitralawardhasonlyanancillarynatureandshouldnotbeentitledtocirculate.85

Hypotesis2.2.2:thefirstnon-ICSIDawardhasnotbeenrecognized,enforcedor

confirmedIf the first award has not been recognized, enforced or confirmed, it seems

unlikelythatthesecondnationalcourtmaygivepreclusiveeffectstothefirstaward(thus refusing enforcement on the basis of public policy, if applicable) in order topreservecoherenceandharmonyofdecisionsonan international level.Whatseemsmorelikelyisthatthesecondcourtwillenforcethesecondissuedaward.

Hypothesis2.3:thefirstnon-ICSIDawardhasbeenannulledbytheCourtofthe

seatThishypothesisisoneofthemostdiscussedtopicsininternationalarbitration

scholarship. This is not the place where to reconstruct the entire debate on thismatter. However, as this author has already stated elsewhere,86it appears that theNew York Convention, which has created a pro-enforcement regime, authorizesnational courts toenforcearbitralawardswhichhavebeenenforcedat theplaceofthe seat. This means that, even if the first award has been annulled, the awardcreditorwillbestillentitledtoseekenforcementelsewhere.Atthispoint,onthebasisofwhetheritisearlierenforcedthefirst(annulled)awardorthesecondaward,wewillfallbackinoneofthesituationsdescribedabove.

4.3 Challengingnon-ICSIDawardsarisingfromduplicativeproceedingsatthe

seatofarbitration(inbrief)Thelastpossibilitythattheawarddebtorofthesecondduplicativeawardhas

recognitionandenforcementofnationaljudgmentswhicharebasedonarbitralawards.OnthescopeofthearbitrationexclusionseeZarra,www.giustiziacivile.com(2014),1andss.85ThematterhasbeenextensivelydealtwithbyScherer,Journalof InternationalDisputeSettlement(2013),587andss.ThisAuthorisextremelycriticwithregardtothejudgmentroute.Onthecontrary,Mosk,Nelson,JournalofInternationalArbitration(2001),469andss.,seemstoendorsetheapproachin order to favour considerations of finality. See also, on the topic,DeWitt, Texas International LawJournal (2015), 495 and ss., Hill, Journal of Private International Law (2012), 159 and ss., Nazzini,Contemporary Asia Arbitration Journal (2014), 139 and ss., Einhorn (2010) (n. 71), 43 and ss., Anon,UniversityofPennsylvaniaLawReview(1974),223andss.,Silberman,King’sLawJournal (2008),235andss.Itseems,however,that–asoftoday–thejudgmentrouteisthepreferredapproachbynationalcourts. See, in this regard, for EnglandChantiers de l’AtlantiqueSA v.Gaztransport& TachnigazSAS[2011] EWHC 3383 (Comm); Diag Human SE v. Czech Republic, [2014] EWHC 1639 (Comm), YukosCapitalSarlv.OJSCRosneftOilCompany,[2011]EWHC1461(Comm).FortheUS,seetheRestatementoftheLaw(Third),TheUSLawonInternationalCommercialArbitration,TentativeDraftNo.2(April2012)andBelmontPartnersLLCv.MinaMarGroupInc.741FSupp.2d743(WDVa2010).Scherer,mentionedin this note, at 600 and ss., has demonstrated that the approach is also followed inAustralia, India,Israel,GermanyandSwitzerland.86See,alsoforanextensivebibliographyonthetopic,Zarra,Rivistadell’arbitrato(2015),574andss.

185

in order to avoid the enforcement of such an award is to try to challenge it at thecourtsoftheplaceoftheseatofarbitration.

Itislargelyrecognizedthatthereasonsforchallenginganawardusuallymirrorthe reasons which entitle a court to refuse enforcement under the New YorkConvention.87It is therefore useless to recall all the above debate: in case a State(which is the seat of a duplicative arbitration) recognizes res judicata, collateralestoppel and/or abuse of process as part of its international public policy, nationalcourtswillbeentitledtoannulthesecondduplicativeawardonthebasisofaviolationoftheirState’sinternationalpublicpolicy.

Thecaselawinthisregardisverylimited.TheonlydecisiononthechallengeofanarbitralawardinthecourtoftheseathasbeentheSVEACourtofAppealdecisionin the CME case, the factual background of which has been already discussed inChapter 3 above.88By applying Swedish law, which does not recognize both resjudicataandabuseofprocessaspartofitspublicpolicy,theCourtrefusedtoannultheCMEaward,issuedinStockholm,thatwasduplicativeoftheLauderaward,issuedinLondon.89In this regard, it isworth noting that the Czech Republic argued that resjudicata was part of Swedish public policy and that the requirement of the same

87SeeLew,Mistelis,Kroll(2003)(n.3),673andss.SeealsoBlackaby,Partasides,Redfern,Hunter(2015)(n.3),581andss.,Bernardini(2009)(n.1),26andss.Forexample,Art.34(2)and(3)oftheUNCITRALModelLawstatethat:“(2)Anarbitralawardmaybesetasidebythecourtspecifiedinarticle6[i.e.thecourtoftheseat]onlyif:

(a)thepartymakingtheapplicationfurnishesproofthat:(i)a party to the arbitration agreement referred to in article 7 was under someincapacity;orthesaidagreementisnotvalidunderthelawtowhichthepartieshavesubjecteditor,failinganyindicationthereon,underthelawofthisState;or(ii)thepartymakingtheapplicationwasnotgivenpropernoticeoftheappointmentofanarbitratororofthearbitralproceedingsorwasotherwiseunabletopresenthiscase;or(iii)theawarddealswithadisputenotcontemplatedbyornotfallingwithinthetermsofthesubmissiontoarbitration,orcontainsdecisionsonmattersbeyondthescopeofthesub-missiontoarbitration,providedthat,ifthedecisionsonmatterssubmittedtoarbitrationcanbeseparatedfromthosenotsosubmitted,onlythatpartoftheawardwhichcontainsdecisionsonmattersnotsubmittedtoarbitrationmaybesetaside;or(iv) the composition of the arbitral tribunal or the arbitral procedure was not inaccordancewiththeagreementoftheparties,unlesssuchagreementwasinconflictwithaprovisionof thisLawfromwhichthepartiescannotderogate,or, failingsuchagreement,wasnotinaccordancewiththisLaw;or

(b)thecourtfindsthat:(i)thesubject-matterofthedisputeisnotcapableofsettlementbyarbitrationunderthelawofthisState;or(ii)theawardisinconflictwiththepublicpolicyofthisState.

(3)Anapplicationforsettingasidemaynotbemadeafterthreemonthshaveelapsedfromthedateonwhichthepartymakingthatapplicationhadreceivedtheawardor,ifarequesthadbeenmadeunderarticle33,fromthedateonwhichthatrequesthadbeendisposedofbythearbitraltribunal”.88The Czech Republic v. CME Czech Republic B.V., SVEA Court of Appeal, Department 16, Case No.T8735-01, available at http://opil.ouplaw.com/view/10.1093/law:iic/63-2003.case.1/IIC063(2003)D.pdf.ThedecisioniscommentedinGallagher,PervasiveProblemsinInternationalArbitration(2006),342andss.89P.95andss.

186

partieswastobeinterpretedbroadly,onthebasisofthealreadydiscussedconceptofprivity (according to which CME and Mr. Lauder should have been consideredrepresenting the same interests and therefore substantially identical parties). Boththeseargumentswererefused.TheCourtofAppealdeclinedtheideathatresjudicatawaspartofpublicpolicyonthebasisofthefactthatinSwedenresjudicataexceptionmay not be raised ex officio. Furthermore, the Court said that in Sweden formalidentitybetween theparties is requiredand therefore it isnotpossible toapply theconceptofprivitydevelopedincommonlawsystems.

This decision, which does not keep into account the policy considerationsendorsedinthisbook,isanywayanisolatedprecedent(tobestronglycriticizedforitsextremely formal reasoning).Onlywith theemergenceof furthercase law itwillbepossibletounderstandwhetherandtowhatextentconsiderationsrelatedtoabuseofprocess,resjudicataandcollateralestoppelmayplayaroleinthechallengeofarbitralawards at the courts of the seat (and in allowing to refuse the enforcement ofinternationalarbitralawards).

187

Conclusions

This book has tried to give some solutions to the problem of parallelproceedingsininvestmentarbitration.

Afterhavingdemonstrated,intheintroductiontoSection1,thatadissertationon parallel proceedings in investment arbitration is very necessary, Chapter 1 hasgivenadefinitionoftheproblemandhasprovidedthereaderwithananalysisofthetaxonomyofparallelproceedings. Inthisregard, ithasbeendemonstratedthat–asinvestmentarbitrationistodayconfigured–itisquiteinevitabletohave(atleasttheriskof)parallel/multipleproceedingsrelatedtothesameclaim.Secondly,andmainly,Chapter 1 has demonstratedwhy parallel proceedings shall be avoided, namely forprotecting values suchas finality, coherence, legal certainty, aswell as saving costsandefficiency.Asaconsequence, it ispossibletosaythatparallelproceedingshavenot only procedural implications, but involve also substantive implications on therightsoftheparties involvedinthedisputefromwhichparallelproceedingsarise. Inlightofthesereasons,Chapter1hasdemonstratedwhyapolicy-orientedanalysisofthesolutionstoparallelproceedingsishighlydesirable. Chapter 2 has demonstrated that the legal instruments aimed at avoidingparallel proceedings that are applicable at the jurisdictional phase of investmentarbitration proceedings are not well fitted to offer such a remedy in internationalarbitration. Themain reason forwhich such tools are unsuitable for the aim of ourresearchisthattheyarealwaysbasedonconsent,i.e.onanexpressionofautonomyofthesamepartiesthatcommencedtheparallelproceedings. Indeed, there is a strong contrast between the consensual paradigm ofinternational arbitration, which is the “grundnorm” of international arbitration, andthenecessitythatarbitration–havingdefactobecomethenaturaljudgefordisputesrelated to international commerce and in particular to international investments –adapts to the substantial needs of modern transactions. The formalism related toconsent,indeed,oftendoesnotallowarbitrationtoadapttothesubstantiverealityofcomplexdisputes,thusgeneratingan“artificialdiscrepancybetweenthesubstantiveand the procedural aspect of the same multiparty relationship”. 1 This situationgeneratestheparadoxthat“[e]conomyandefficiencymaybefrustratedbyanumberofdilatory factorsbefore,duringandafter thearbitration. Ironically,manyof thesepotential causes of delay are rooted in those characteristics of arbitration thatdistinguish it fromtraditionaladjudicationprocesses.Nowhere is thisparadoxmoreevidentthatindisputesinvolvingmultipleparties”.2

In light of the above, remedies such as consolidation and joinder cannot beconsideredasgeneralsolutionstotheproblemofparallelproceedings,duetothefactthatitishighlyprobablethatoneofthepartieswillnotgiveitsconsenttotheseformofcoordination.Furthermore–andmost importantly– ICSIDConventionandRules

1Brekoulakis,PennStateLawReview(2009),1182.2Stipanowich,IowaLawReview(1987),475.

188

arecompletelysilentonthepossibilitytocoordinateparallel/multipleproceedingsortojointhirdparties.Thismeansthattheonlyplausiblesolutionisquasi-consolidation,i.e. the appointmentof the samearbitrators for twoparallel disputes (that, indeed,seemstheonlyone thathasbeenapplied inacertainnumberofcases).Dueto thefactthatthemajorityofinvestmentarbitrationsareheldintheICSIDframework,weare today stuck in a situation of total lack of rules providing for coordination ofproceedingsand/orpossible involvementof thirdparties.Other formsofarbitrationare even more based on consent and therefore still strictly anchored to theimpossibility to extend the proceedings to third parties without consent by all ofthem.

However, aswehave seen inChapter 3, this cannotbe theendof the story.The already mentioned policy considerations (i.e. reliability and legitimacy ofarbitration as an adjudication process, judicial economy, efficiency and finality)impose to avoid and limit parallel proceedings. If such policy considerations cannotfindaplacewhenarbitratorsconsidertheirjurisdiction,thisdoesnotmeanthattheycannotbekept intoaccountata laterstageintheproceedings, i.e.theadmissibilityphase. Chapter3has startedwithananalysisof thedistinctionbetween jurisdictionand admissibility in investment arbitration and of the possible sources of suchdistinction. Having identified the legal basis of such distinction, the research hasanalysed the law applicable in investment arbitration and, in particular, theapplicabilityofgeneralprinciplesofinternationallaw.Ithasbeendemonstratedthat,at the admissibility phase, arbitrators have the inherent power to preclude thecontinuationofproceedingsthatrunagainstgeneralprinciplesofinternationallaw. Theanalysishasthenturnedtothespecificgeneralprinciplesofinternationallawwhose violationmay be at the basis of a declaration of inadmissibility, namelygoodfaithandnebisinidem.Aswehaveseen,bothoftheseprinciplesmaybeapplieddifferentlyandmaybespecifiedinothermorespecificprinciplesorrules.Inparticular,theprincipleofgoodfaithcangiverisetothedoctrineofabuseofprocess,whilethene bis in idem principle has generated the principles of claim preclusion and issuepreclusion. TheassumptionatthebasisofChapter3hasbeenthatarbitralawards,asanyjudicialdecisions,mayhaveeffectonallthirdpartiesthataresubstantiallyconnectedtothepartiesinvolvedintheproceedings.Indeed,ithasbeendemonstratedthattheeffectsofarbitraldecisionsareipsofactoextensibleonthirdpartieswhoareinprivitywith one of the parties of the first claim. If a third party’s interests have beenadequately representedby theclaimant in the firstaction,sucha thirdpartywillbethereforeprecludedtostartasecondclaimwhichissubstantiallyidenticaltowhathasbeen already decided. In such a case, the second claim should be declaredinadmissible.

189

Given the above, Chapter 3 has been demonstrated that abuse of process,issue estoppel and, if interpretedbroadly, res judicata are valuable tools in order toavoid,oratleastlimit,theeffectsofparallelproceedings.

Thedoctrineofabuseofprocessimposestothepartiestonotmakerecourseto investmentarbitrationwiththeaimofgettingunfairadvantagesand/ortoharassthe other party. If procedural rights are not exercised for their proper scope, it isarguablethataclaimdoesnotdeservetheprotectionofthelawandthatsuchaclaimshouldbedeclaredinadmissible.

Claimpreclusion(resjudicata)andissuepreclusion(collateralestoppel)aretwodoctrines which are aimed at ensuring finality of judicial decisions (respectively onentire claims or single issues), coherence and stability. After having analysed thevariouspossibleapplicationsofsuchdoctrineswehavedemonstratedthat,ifbroadlyinterpreted,resjudicataandcollateralestoppelcanbeveryusefulinordertopreventparallelproceedingsandconflictingdecisions.

However,priortoapplyallsuchdoctrines,itisessentialtomake,onacase-by-casebasis,acoordinationofanyofthemwiththeprincipleofdueprocess.

Finally, and keeping into account all the above discussion, Chapter 3 hasintroducedaproposaltoamendinvestmentarbitrationrulesinordertorenderthemmoreeffectiveandpolicyorientedwillbemade;suchaproposalisbasedonaformofinterventionofthirdpartiessubjecttotheawardonthebasisofan invitationofthearbitrators.Ifsuchthirdpartiesshouldrefusetointervene,theywillthenbeestoppedtoclaimthattheyarenotsubjecttotheeffectsoftheaward.

Chapter4hasregardedtheremediestoparallelproceedingsatthepost-awardphase of investment arbitration. Such an analysis has required to make a cleardistinction between the post award remedies in ICSID arbitration and in non-ICSIDarbitration.ThemaindifferencestaysinthefactthatICSIDisconsideredtobeaself-contained systemof arbitration, fully autonomous and independentof anynationalsystems, which covers all aspects of the arbitral proceedings and extends to thechallengeof theawards, the latterbeingregulatedonlyby theConvention,withoutany interference by national courts or other national authorities, no room for theapplication of the New York Convention beingmade regarding enforcement of anICSIDaward.Thus,wehaveexaminedthepossibilitytoprecludetheexistenceoftwoduplicative proceedings in light of the ground for annulment given by themanifestexcess of powers of arbitrators. In this regard, we have concluded that it is veryunlikelythataremedytoparallelproceedingsmaybefoundattheannulmentstageofICSIDproceedings.

Withregardtonon-ICSIDawards,theymaybeeitherchallengedattheplaceoftheseatofthearbitrationor, ifoneofthegroundsset forth inArt.VoftheNewYork Convention 1958, the courts of the Statewhere such enforcement is requiredmayrefusetheirenforcement.Theonlygroundforrefusingenforcementonthebasisof theexistenceofduplicativeawards is thepublicpolicyexceptionset forth inArt.V(2)(b)of theNewYorkConvention.For this reason,wehave tried todemonstrate

190

whether abuse of process, res judicata and collateral estoppel may be part ofinternationalpublicpolicyinseveraldifferentlegalsystemsand,thereafter,wehavetriedtoseehowthisremedycouldoperateinconcrete.

In conclusion, this book has tried to propose an approach to parallelproceedingsthatgoesbeyondtheformalitiesofthedisputeandisbasedontheverystrong substantial implications that exist between all the parties of an economicaltransaction, regardless of the way in which a certain dispute is brought beforearbitrators.Suchanapproach,whichfindslegalbasisbothininternationallawandinmunicipal lawsystems, is todayhighlydesirable inorder toensure thecredibilityofinvestmentarbitrationandtosafeguardtheinterestsofrespondentStates.

This bookhas not covered the analysis and thepossible solutions to parallelproceedings between national courts and investment arbitration tribunals andbetween investment arbitration tribunals and other international fora. While theformerofthesetopicshasfoundsomeanalysisinotherworks(mentionedinthetext),thelatterwouldneedsomenewdetailedstudies,eveninlightoftheclearemergenceoftheproblemindisputessuchastheonesoftheYukosandChevronsagas.Itcouldmaybebethesubjectofanotherbook…

191

SelectedBibliography

1. Abi-Saab,CoursGénéraldeDroit InternationalPublic,207RecueildesCours9(1996)

2. Abi-Saab, Fragmentation or Unification: Some Concluding Remarks, 31 NewYorkUniversityJournalofInternationalLawandPolitics919(1999)

3. Aghenitei, Flamanzeanu, Universal Jurisdiction and the principle of ne bis inidem,in4ChallengesoftheKnowledgeSociety131(2011).

4. Aiken, Consolidation of separate arbitration proceedings, available athttp://www.ashrlaw.com/dox/SKA-arb-consolidation.pdf(2009)

5. Al-Qahtani,TheStatusofWould-BeInterveningStatesBeforetheInternationalCourt of Justice and the Application of Res Judicata, 2 The Law and Practice ofInternationalCourtsandTribunals269(2003)

6. Alexandrov,Breaches of Contract andBreaches of Treaty, 5 Journal ofWorldInvestmentandTrade555(2004).

7. Alexandrov,The"BabyBoom"ofTreaty-BasedArbitrationsandtheJurisdictionof ICSIDTribunalsShareholdersas "Investors"under InvestmentTreaties,6 JournalofWorldInvestmentandTrade387(2006)

8. Alexeyev, Voitovich,Tokios Tokeles Vector: Jurisdictional Issues in ICSID CaseTokiosTokelesv.Ukraine,9JournalofWorldInvestmentandTrade519(2008)

9. Ali,Nesbitt,Wessel,Anti-suitInjunctionsinSupportofInternationalArbitrationintheUnitedStatesandtheUnitedKingdom,InternationalArbitrationLawReview12(2008)

10. Allorio,Lacosagiudicatarispettoaiterzi,Giuffrè(1935reprintedin1992)11. Alvarez, Arbitration under the North American Free Trade Agreement, 16

ArbitrationInternational393(2000)12. Alvarez,ImplicationsfortheFutureofInternationalInvestmentLaw,inSauvant

(ed.)AppealsMechanisminInternationalInvestmentDisputes29,Oxford(2008)13. Alvarez, The Public International Law Regime Governing International

Investment,344RecueildesCours(2009),193-54414. Alvarez-Jimenez,TheWTOAppellate Body’s Exercise of Judicial Economy, 12

JournalofInternationalEconomicLaw393(2009)15. Amerasinghe,InternationalArbitralJurisdiction,Brill(2011)16. Amerasinghe, Local Remedies in International Law, Cambridge University

Press(2004)17. Amerasinghe,Stateresponsibilityforinjurytoaliens,Oxford(1967)18. Andritoi, The “Collateral Estoppel” Theory in International Law, 7 Acta

UniversitatisDanubius47(2011)19. Anon,ForeignJudgmentsBasedonForeignArbitralAwards:TheApplicabilityof

ResJudicata,124UniversityofPennsylvaniaLawReview223(1975)20. Arbour,TheLouisianaConcept ofRes Judicata, 34 LouisianaLawReview 763

(1974)21. Arfazadeh,IntheShadowoftheUnrulyHorse:InternationalArbitrationandthe

PublicPolicyException,13TheAmericanReviewofInternationalArbitration43(2003)22. Ascensio,AbuseofProcess in International InvestmentArbitration,13Chinese

JournalofInternationalLaw763(2014)23. Atteritano, Anti-suit injunctions in ambito arbitrale: provvedimenti illeciti o

semplicementeodiosi?,19Rivistadell’arbitrato441(2010)24. Atteritano,L’enforcementdellesentenzearbitralidelcommerciointernazionale,

Giuffré(2009)25. Aust,HandbookofInternationalLaw,CambridgeUniversityPress(2010)26. Bachand,Kompetenz-Kompetenz,CanadianStyle,25ArbitrationInternational

431(2009)

192

27. Bagner,HowtoAvoidConflictingAwards:TheLauderandCMECases,5JournalofWorldInvestmentandTrade31(2004)

28. Bain,BridgingtheProceduralGap:ArbitrationDecisionsasaBasisforCollateralEstoppel–Benjaminv.TrafficExecutiveAssociationEasternRailroads,1990JournalofDisputeResolution189(1990)

29. Balena, Sentenza contro società di persone ed effetti per il socio, 4 Il giustoprocessocivile36(2009)

30. Balkanyi-Nordmann,ThePerilsofParallelProceedings:IsanArbitrationAwardEnforceable if theSameCase isPendingElsewhere?, AAAHandbookon InternationalArbitration&ADR.secondedition169(2010)

31. Balladore Pallieri, I “principi generali del diritto riconosciuti dale nazioni civilinell’art. 38 dello statuto della Corte permanente di Giustizia internazionale, Memoriedell’IstitutogiuridicodellaR.UniversitàdiTorino(1931)

32. Bamforth, Joining non-signatories to an arbitration recent developments, 2DisputeResolution9www.practicallaw.com/6-275-4952(2007/08)

33. Bamforth, Maidment, “All join in” or not? How well does internationalarbitration cater for disputes involving multiple parties or related claims?, 27 ASABulletin3(2009)

34. Barcelò, Anti-Foreign-Suit Injunctions to Enforce Arbitration Agreements,CornellLawFacultyPublication,Paper87(2007)

35. Barin, Non-signatories in International Arbitration: Some Thoughts fromCanada,invandenBerg(ed.)InternationalArbitration2006:BacktoBasics?,13ICCACongressSeries375(2007)

36. Barron, Court-ordered Consolidation of Arbitration Proceedings in the UnitedStates,4JournalofInternationalArbitration81(1987)

37. Barnett, Res Judicata, Estoppel, and Foreign Judgements, Oxford UniversityPress(2001)

38. Bassett,TheForumGame,84NorthCarolinaLawReview,333(2006)39. Bastin,TheAmicusCuriaeinInvestor-StateArbitration,1CambridgeJournalof

InternationalandComparativeLaw208(2012)40. Baumgartner,RelatedActions,3ZeitschriftfürZivilprozeßInternational2003

(1998)41. Begic, Applicable Law in International Investment Disputes, eleven

internationalpublishing(2005)42. Bekker,Recalibrating the Investment TreatyArbitrationSystemThroughNon-

Compartimentalized Legal Thinking, 55 Harvard International Law Journal Online 1(2013)

43. Bell,ForumShoppingandVenueinTransnationalLitigation,OxfordUniversityPress(2003)

44. Belohlavek, Cerny, Law applicable to claims asserted in internationalinvestmentdisputes,54InternationalJournalofLawandManagement443(2012)

45. Benedettelli, Le anti-suit injunctions nell’arbitrato internazionale: questioni dilegittimitàeopportunità,24Rivistadell’Arbitrato701(2014)

46. Beniassadi, Do Mandatory Rules of Public Law Limit Choice of Law inInternational Commercial Arbitration?, 10 International Tax and Business Lawyer 59(1992)

47. Bergamini, IlcasoNobleVenturese“TheUmbrellaClauseProblem”,14Rivistadell’arbitrato118(2005)

48. Bermann, The Use of Anti-suit Injunctions in Transnational Litigation, 28ColumbiaJournalofTransnationalLaw589(1990)

49. Bernal-Fandiño,Rojas-Quiñones,Lavinculatoriedaddeunlaudoarbitralfrentea terceros en la doctrina del collateral estoppel, 16 Revista Colombiana de DerechoInternacional455(2010).

193

50. Bernardini, Icsid versus non Icsid investment treaty arbitration,http://www.arbitration-icca.org/media/0/12970223709030/bernardini_icsid-vs-non-icsid-investent.pdf(2009)

51. Bernardini, Investment arbitration under the ICSID convention and BITS, inAksen, Bockstiegel, Mustill, Patocchi, Whitesell (eds.), Global reflections oninternational law, commerce and dispute resolution – Liber amicorum in honour ofRobertBriner,89(2005)

52. Bernardini, Investment Protection under bilateral investment treaties andinvestmentcontracts,2JournalofWorldInvestment236(2001)

53. Bernardini, The law applied by international arbitrators to state contracts, inBriner, Fortier, Berger, Bredow (eds.), Law of International Business and DisputesSettlementinthe21stcentury–LiberAmicorumKarl-HeinzBockstiegel51(2004)

54. Bernasconi-Osterwalder, Johnson, Marshall, Arbitrator Independence andImpartiality: Examining the dual role of arbitrator and counsel, IV Annual Forum forDeveloping Country Investment Negotiators, New Dehli, 27-29 October 2010,BackgroundPapers(2010)

55. Bernhardt,Article59,inZimmerman,Tomuschat,Oellers-Frahm,Tams(eds.),TheStatuteoftheInternationalCourtofJustice1231,OxfordOUP(2012)

56. Betti, Trattato dei limiti soggettivi della cosa giudicata in diritto romano,Macerata(1922)

57. Beyer, Reevaluating the “Corporate Veil” Metaphor in the Context ofInternational Trade: A Critical Analysis of Hester International Corporation v. FederalRepublicofNigeria,14MarylandJournalofInternationalLawandTrade233(1990)

58. Bhala,TheMythaboutStareDecisisandInternationalTradeLaw(PartOneofaTrilogy),14AmericanUniversityInternationalLawReview845(1998)

59. Bhala,ThePrecedentSetters:DeFactoStareDecisisinWTOAdjudication(PartTwoofaTrilogy),9JournalofTransnationalLawandPolitics1(1999)

60. Bigge, Iura Novit Curia in Investment Treaty Arbitration/ May? Must?,www.kluwerarbitrationblog.com(2011)

61. Bjorklund, Investmentarbitration, inMistelisBerman (eds.),MandatoryRulesinInternationalArbitration233,JurishPublishing(2010)

62. Bjorklund, Investment Treaty Arbitral Decisions as Jurisprudence Constante,www.transnational-dispute-management.com(2010)

63. Bjorklund,Nappert,Beyond Fragmentation,www.ssrn.com/abstract=1739997(2011)

64. Blackaby, Partasides, Redfern, Hunter, Redfern and Hunter on InternationalArbitration,OxfordOUP(2015)

65. Blanchard, State Consent, Temporal Jurisdiction, and the Importation ofContinuing Circumstances Analysis Into International Investment Arbitration, 10WashingtonUniversityGlobalStudiesLawReview419(2011)

66. Blanke, ICSID Tribunal declines personal jurisdiction over dual national underEgyptUAEBIT,www.kluwerarbitrationblog.com(2014)

67. Bleimaier, The Doctrine of Comity in Private International Law, 24 CatholicLawyer327(1979)

68. Blyschak,Accessandadvantageexpanded:MobilCorporationvVenezuelaandotherrecentarbitrationawardsontreatyshopping,4JournalofWorldEnergyLawandBusiness32(2011)

69. Blyschak, State Consent, Investor Interests and the Future of InvestmentArbitration: Reanalyzing the Jurisdiction of Investor-State Tribunals in Hard Cases,works.bepress.com/paul_blyschak/2(2008)

70. Blyschak,Yukos Universal v. Russia: Shell Companies and Treaty Shopping inInternational Energy Disputes, 10 Richmond Journal of Global Law & Business 179(2011)

194

71. Bockstiegel, An Arbitrator’s Perspective of BITs and their Relation to OtherInternational Law Obligations, Paper given at the Conference 50 Years of BilateralInvestmentTreaties–TakingStockandLooktotheFutureFrankfurt(2009)

72. Bockstiegel, Commercial and Investment Arbitration: How Different are theyToday?,28ArbitrationInternational577(2012)

73. Boddicker, Whose Dictionary Controls? Recent Challenges to the Term"Investment" in ICSIDArbirtration, 25AmericanUniversity International LawReview1031(2010)

74. Bonafè, La Cour, le Tribunal arbitral et le pouvoir de suspendre l’instance, 3Ordineinternazionaleedirittiumani327(2014)

75. Bonafè, La protezione degli interessi di Stati terzi davanti alla Corteinternazionaledigiustizia,EditorialeScientifica,Napoli(2014)

76. Bond, Dépeçage or Consolidation of the Disputes Resulting from ConnectedAgreements: The Role of the Arbitrator, in Schwartz, Hanotiau (eds.), MultipartyArbitration,DossiersoftheICCInstituteofWorldBusinessLaw35(2010)

77. Bone,Rethinkingthe“DayintheCourt”IdealandNonpartyPreclusion,67NewYorkUniversityLawReview193(1992)

78. Bonato,Lanozioneegli effetti della sentenzaarbitraleneldiritto francese, 41Rivistadidirittoprocessuale669(2006)

79. Bottini, IndirectClaimsUndertheICSIDConvention,29U.Pa.J. Int’l.Law563(2008)

80. Bove,Processoarbitraleeterzi,5Rivistadell’arbitrato784(2005)81. Bowett, Estoppel Before International Tribunals and Its Relation to

Acquiescence,33BritishYearbookofInternationalLaw176(1957)82. Brekoulakis,PartiesinInternationalArbitration:Consentv.CommercialReality,

Conference Materials of the School of International Arbitration 30th AnniversaryConference: “The Evolution and Future of International Arbitration: The Next 30Years”,Unpublished(2015)

83. Brekoulakis,TheEffectofanArbitralAwardandThirdParties in InternationalArbitration:ResJudicataRevisited,16AmericanReviewof InternationalArbitration1(2005)

84. Brekoulakis, The Relevance of the Interests of Third Parties in Arbitration:Taking a Closer Look at the Elephant in the Room, 113 Penn State LawReview 1165(2009)

85. Brekoulakis, Third Parties in International Commercial Arbitration, OxfordUniversityPress(2010)

86. Brengesjo, Lis Alibi Pendens in International Arbitration, Doctoral Thesis –Stockholm University, http://www.diva-portal.org/smash/get/diva2:661930/FULLTEXT01.pdf(2013)

87. Brierly,TheBasisofObligationinInternationalLaw,inBrierly(ed.)TheBasisofObligationinInternationalLaw29,ScientiaVerlag(1968)

88. Briggs, Nicaragua v. United States: Jurisdiction and Admissibility, 79 TheAmericanJournalofInternationalLaw373(1985)

89. Brower, Henin, Kemperink, Res Judicata, in Kinnear, Fischer et al. (eds.),BuildingInternationalInvestmentLaw:TheFirst50YearsofICSID55,Kluwer(2015)

90. Brower, Ottolenghi, Prows, Saga of CMS: Res Judicata, Precedent, and theLegitimacy of Icsid Arbitration, in Binder, Kriebaum, Reinisch, Wittich (eds.),International Investment Law for the 21st Century: Essays in Honour of ChristophSchreuer(2009)

91. Brower, Sharpe, Multiple and Conflicting International Arbitral Awards, 4JournalofWorldInvestment211(2003)

92. Brower, Schill, Is Arbitration a Threat or a Boon to the Legitimacy ofInternationalInvestmentLaw?,9ChicagoJournalofInternationalLaw471(2009)

195

93. Brown,The Relevance of the Doctrine of Abuse of Process in InternationalAdjudication,8TransnationalDisputeManagement1(2011)

94. Brown,The IdeologiesofForumShopping–WhyDoesn’taConservativeCourtProtectDefendants?,71NorthCarolinaLawReview649(1993)

95. Brown, The Inherent Powers of International Courts and Tribunals, 76 BritishYearbookofInternationalLaw195(2005)

96. Brown, The Use of Precedents of other International Courts and Tribunals inInvestmentTreatyArbitration,TransnationalDisputeManagement(2008)

97. Buergenthal,Proliferation of International Courts and Tribunals: Is It Good orBad?,14LeidenJournalofInternationalLaw267(2001)

98. Buffard, Zemanek, The “Object and Purpose” of a Treaty: An Enigma?, 3AustrianReviewofInternational&EuropeanLaw313(1998)

99. Burgstaller,NationalityofCorporateInvestorsandInternationalClaimsagainsttheInvestor’sOwnState,7JournalofWorldInvestmentandTrade857(2006)

100. Busch,Pelc,ThePoliticsof JudicialEconomyat theWorldTradeOrganization,64InternationalOrganization257(2010)

101. Byers,AbuseofRights:AnOldPrinciple,ANewAge,47McGillLawJournal389(2002)

102. Byrnes,Pollman,Arbitration,ConsentandContractualTheory:TheImplicationsofEEOCv.WaffleHouse,8HarvardNegotiationLawReview289(2003)

103. Calamandrei, Istituzioni di diritto processuale civile secondo il nuovo codice,Lezioniuniversitarie,Padua(1941)

104. Callen, Kadue, To Bury Mutuality, Not to Praise It: An Analysis of CollateralEstoppelAfterParklaneHosieryCo.v.Shore,31HastingsL.J.755(1979-1980)

105. Campbell, Nappert, Nottage, Assessing Treaty-based Investor-State DisputeSettlement/ Abandon, Retain or Reform?,http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2280182(2013)

106. Cannizzaro, Interconnecting International Jurisdictions, 1 European Journal ofLegalStudieswww.ejls.eu(2007)

107. Carbone,Promessaeaffidamentoneldirittointernazionale,Giuffré(1967)108. Carlevaris, L’accertamento del diritto nell’arbitrato internazionale tra principio

juranovitcuriaeoneredellaprova,16Rivistadell’arbitrato505(2007)109. Carlevaris,Lacompetenzadei tribunali internazionali traviolazionedei trattati

sugli investimenti e violazione delle obbligazioni contrattuali, 13 Rivista dell’arbitrato431(2004)

110. Carlevaris,Latutelacautelarenell’arbitratointernazionale,CEDAM(2006)111. Carlevaris,TheConformityof Investmentswith theLawof theHostStateand

theJurisdictionofInternationalTribunals,9JournalofWorldInvestmentandTrade35(2008)

112. Carnelutti, Istituzionidelprocessocivile italiano,vol. 1,Ved.,SocietàEditricedelForoItaliano,Roma(1956)

113. Carnelutti,Efficacia diretta e efficacia riflessa della cosa giudicata, inStudi didirittoprocessuale,CEDAM,Padova(1925)

114. Caron,FramingtheWorkofICSIDAnnulmentCommittees,6WorldArbitration&MediationReview173(2012)

115. Carpanelli,General Principles of International Law: Strugglingwith a SlipperyConcept, in Pineschi (ed.)General Principles of Law – The Role of the Judiciary 125,Springer(2015)

116. Carrington, Collateral Estoppel and Foreign Judgments, 24 Ohio State LawJournal381(1963)

117. Carter,ThePrincipleofComplementarityand the InternationalCriminalCourt:TheRoleofNeBisinIdem,8SantaClaraJournalofInternationalLaw1(2010)

118. Carver,HowtoAvoidConflictingAwards:TheLauderandCMECases,5Journal

196

ofWorldInvestmentandTrade23(2004)119. Casad, IssuePreclusionandForeignCountryJudgments:WhoseLaw?,70 Iowa

LawReview53(1984)120. Casad, Clermont, Res Judicata, An Handbook on Its Theory, Doctrine and

Practice,CarolinaAcademicPress(2001)121. Cassese,DirittoInternazionale(acuradiGaeta),IlMulino(2006)122. Castaldo, L’uso distorto del processo: riflessioni in margine ad una recente

sentenza della Cassazione,http://www.consiglionazionaleforense.it/site/home/agenda/documento5237.html(2011)

123. Castro de Figuereido, Previous Decisions in Investment Arbitration,www.kluwerarbitrationblog.com(2014)

124. Cavallini, L’efficacia (riflessa) della sentenza nel pensiero di E. T. Liebman, 42Rivistadidirittoprocessuale1221(2007)

125. Cerny,ShortFlightofthePhoenix:AFewThoughtsonGoodFaith,theAbuseofRightsandLegality in InvestmentArbitration, 3CzechYearbookof InternationalLaw183(2012)

126. Charney, The Impact on the International Legal System of the Growth ofInternational Courts and Tribunals, 31 New York University Journal of InternationalLawandPolitics697(1999)

127. Chavier,EquitableRelief –Anti-suit Injunctions, 14SuffolkTransnational LawJournal257(1990-1991)

128. Cheng, General Principles of Law as Applied by International Courts andTribunals,CambridgeUniversityPress(2006)

129. Cheng, Precedent and Control in Investment Treaty Arbitration,www.transnational-dispute-management.com(2008)

130. Cheng, The Role of Justice in Annulling Investor-State Arbitration Award, 31BerkeleyJournalofInternationalLaw236(2013)

131. Chi,TheFadingofCompulsoryConsolidationofArbitration:AFightbetweenthePrinciples of Efficiency and Party Autonomy in International Commercial Arbitration,ssrn.com/abstract=1674281(2008)

132. Childress, Comity as Conflict: Resituating International Comity as Conflict ofLaws,44UniversityofCaliforniaDavis11(2010)

133. Childress, Forum Conveniens: The Search for a Convenient Forum inTransnationalCases,53VirginiaJournalofInternationalLaw157(2012)

134. Chillakaru, The Rule of Competence-Competence: A Comparative Analysis ofIndianandEnglishLaw,6ContemporaryAsianArbitrationJournal133(2013)

135. Chiu, Consolidation of Arbitral Proceedings and International Arbitration, 7JournalofInternationalArbitration53(1990)

136. Chukwumerije, International Law and Article 42 of the ICSID Convention, 14JournalofInternationalArbitration79(1997)

137. Chizzini,L’interventoadesivo,CEDAM,Padova(1991)138. Ciurtin, Beyond the Norm: The Hermeneutic Function of Treaty Preambles in

InvestmentArbitrationandInternationalLaw,36RevistaRomânădeArbitraj64(2015)139. Clermont, Eisenberg, Exorcising the Evil of Forum-Shopping, 80 Cornell Law

Review1507(1995)140. Collings,UsingCollateralEstoppelAfterArbitration,LosAngelesLawyer,July-

August200520(2005)141. Commission, Precedent in Investment Treaty Arbitration, 24 Journal of

InternationalArbitration129(2007)142. Comoglio, Abuso del processo e garanzie costituzionali, 43 Rivista di diritto

processuale319(2008)143. Comoglio,Ilprincipiodieconomiaprocessuale,vol.1-2,CEDAM,Padova(1980)

197

144. Conejero Roos, Multi-Party Arbitration and Rule Making: Same Issues,ContrastingApproaches,invandenBerg(ed.),50YearsoftheNewYorkConvention:ICCAInternationalArbitrationConference,14ICCACongressSeries343(2009)

145. Conforti, Buona fede e diritto internazionale, in Busnelli (ed.), Il principio dibuonafede87,Giuffrè,Milano(1987)

146. Conforti,DirittoInternazionaleIXedizione,EditorialeScientifica(2013)147. Conforti,Qualcheriflessionesulcontributodeigiudiciinternazionaleedinternial

dirittointernazionale,Rivistagiuridicadeglistudentdell’UniversitàdiMacerata,23-27(2010)

148. Consolo, Domande autodeterminate e litisconsorzio necessario nel giudizioarbitrale,53Rivistadidirittoprocessuale1406(2013)

149. Consolo, Profili della litispendenza internazionale, 91 Rivista di dirittointernazionale5(1997)

150. Conway,NeBisinIdeminInternationalLaw,3CriminalLawReview217(2003)151. Cordopatri,L’abusodelprocessoneldirittopositivoitaliano,47Rivistadidiritto

processuale874(2012)152. Cosmas,LegitimacycrisisinInvestor–StateInternationalArbitrationSystem:A

Critique on the Suggested Solutions & the Proposal on the Way Forward, 4 (11)InternationalJournalofScientificandResearchPublications1(2014)

153. Cottier,Müller,Estoppel, inBernhard(ed.),MaxPlanckEncyclopediaofPublicInternationalLaw(onlineedition)(2007)

154. Courtney, Binding Non-Signatories to International Arbitration Agreements:RaisingFundamentalConcernsintheUnitedStatesandAbroad,8RichmondJournalofGlobalLaw&Business581(2009)

155. Cox, Dépeçage or Consolidation of Disputes Resulting from ConnectedAgreements: The Role of the Judge, in Schwartz, Hanotiau (eds.), MultipartyArbitration,DossiersoftheICCInstituteofWorldBusinessLaw49(2010)

156. Craig, Introduction, inPermanentCourt ofArbitration (ed.)MultipleParty inInternationalArbitrationlvii,OxfordUniversityPublishing(2009)

157. Crawford, Treaty and Contract Claims in Investment Treaty Arbitration, 24ArbitrationInternational351(2008)

158. Cremades,ArbitrationUndertheECTandOtherInvestmentProtectionTreaties:Parallel Arbitration Tribunals and Awards, www.transnational-dispute-management.com(2005)

159. Cremades,GoodFaithinInternationalArbitration,27AmericanUniversityLawReview761(2012)

160. Cremades,Has the Proliferation of BITS Gone Too Far? Is it Now Time for aMultilateralInvestmentTreaty?,5JournalofWorldInvestmentandTrade89(2004)

161. Cremades, Cairns, Contract and treaty claims and choice of forum in foreigninvestmentdisputes, inCremades,Lew(eds.),ParallelStatesandArbitralProceduresinInternationalArbitration,ICCPublication13(2005)

162. Cremades, Madalena, Parallel Proceedings in International Arbitration, 24ArbitrationInternational507(2008)

163. Crespi Reghizzi, Diritto internazionale e diritto interno nelle controversiesottoposteadarbitratoICSID,45Rivistadidirittointernazionaleprivatoeprocessuale5(2009)

164. Crivellaro, Consolidation of Arbitral and Court Proceedings in InvestmentDisputes,4TheLawandPracticeofInternationalCourtsandTribunals371(2005)

165. Cromwell, Arbitration and Its Collateral Estoppel Effect on Third Parties -Vandenbergv.SuperiorCourt,2JournalofDisputeResolution425(2000)

166. Cuniberti, Parallel Litigation and Foreign Investment Dispute Settlement, 21ICSIDReview–FILJ381(2006)

167. Cunningham,CollateralEstoppel:theChangingRoleoftheRuleofMutuality,41

198

MissouriLawReview521(1976)168. Currie, Mutuality of Collateral Estoppel: Limits of the Bernhard Doctrine, 9

StanfordLawReview281(1957)169. Currie, Res Judicata: The Neglected Defense, 45 University of Chicago Law

Review317(1978)170. CurtiGialdino, Imputazionegiuridicaebuonafedenellaconclusiondei trattati,

46Rivistadidirittointernazionale427(1960)171. D’Agnone,IconflittidigiurisdizionetratribunaliICSIDeforigiudizialinazionali,

DoctoralThesis,UniversityofMacerata(2013)172. D’Agostino, Rescuing International Investment Arbitration: Introducing

DerivativeActions,ClassActionsandCompulsory Joinder,98VirginiaLawReview177(2012)

173. Dahlberg, Fork-in-the-road provisions in investment treaties,http://www.allenovery.com/publications/en-gb/Pages/Fork-in-the-road-provisions-in-investment-treaties.aspx(2009)

174. Đajić, Mapping The Good Faith Principle in IInternational InvestmentArbitration: Assessment of Its Substantive and Procedural Value, 46 Proceedings ofNoviSadFacultyofLaw207(2012)

175. Daly, Come One, Come All: The New and Developing World of NonsignatoryArbitrationandClassArbitration,62UniversityofMiamiLawReview95(2007)

176. dallaMassara,Ladomandafrazionatae ilsuocontrastocon iprincipidibuonafede e correttezza: il “ripensamento delle Sezioni unite, 54 Rivista di diritto civile 345(2008)

177. Das, Preclusion, Lis Pendens & Stare Decisis: Severity in InternationalCommercialArbitration,www.academia.edu,lastaccess26April2015

178. Daujotas, Non-Signatories and Abuse of Corporate Structure in InternationalCommercialArbitration,ssrn.com/abstract=2148900(2012)

179. Debattista,ArbitratorsPowers toOrder InterimMeasures (IncludingAnti-SuitInjunctions), http://www.lmaa.org.uk/uploads/documents/C50ArbitratorsPowers.pdf(2008)

180. DeBrabandere,‘GoodFaith’,‘AbuseofProcess’andtheInitiationofInvestmentTreatyClaims,3JournalofInternationalDisputeSettlement609(2012)

181. De Brabandere, Investment Treaty Arbitration as Public International Law,CambridgeUniversityPress(2014)

182. DeCamp, Consolidation of Separate Arbitration Proceedings: LiberalConstruction versus Contractarian Approaches – United Kingdom of Great Britain v.BoeingCo.,JournalofDisputeResolutionVol.1994113(1994)

183. de Gramont, After the Water War: The Battle for Jurisdiction in Aguas DelTunari, S.A. v. Republic of Bolivia, www.transnational-dispute-management.com(2006)

184. DeLaOlivaSantos,Oggettodelprocessocivileecosagiudicata,Giuffré(2009)185. deLotbiniéreMcDougall,ResJuricatainInternationalArbitration:CaseStudies

andPrinciples,9TransnationalDisputeManagement(2012)186. DeLy,RadicatidiBrozolo,Friedman,ILAReportfortheBiennialConferencein

WashingtonD.C.April2014(2014)187. De Ly, Sheppard, ILA Final Report on Lis Pendens and Arbitration, 25

ArbitrationInternational3(2009)188. De Ly, Sheppard, ILA Final Report on Res Judicata and Arbitration, 25

ArbitrationInternational35(2009)189. de Prada Rodriguez, Munoz Rojo, El proceso civil ingles, Editorial Comares

(2014)190. Derains,IsthereAGroupofCompaniesDoctrine?,inSchwartz,Hanotiau(eds.),

MultipartyArbitration,DossiersoftheICCInstituteofWorldBusinessLaw11(2010)

199

191. Devolvé,Multipartism: TheDutcoDecision of the French Cour de cassation, 9ArbitrationInternational197(1993)

192. DeWitt, A Judgment Without Merits: The Recognition and Enforcement ofForeign Judgments Confirming, Recognizing, or Enforcing Arbitral Awards, 50 TexasInternationalLawJournal495(2015)

193. Di Benedetto, International Investment Law and the Environment, EdwardElgar(2013)

194. Dodge, International Comity in American Law, 115 Columbia Law Review 1(2015)

195. Dodge,NationalCourts and InternationalArbitration: Exhaustion ofRemediesand Res Judicata Under Chapter Eleven of Nafta, 23 Hastings International &ComparativeLawReview357(2000)

196. Dolinger,WorldPublicPolicy: real InternationalPublicPolicy in theConflictofLaws,17TexasInternationalLawJournal167(1982)

197. Dolzer,Schreuer,PrinciplesofInternationalInvestmentLaw,Oxford(2012)198. Dondi,Culturadell’abusoeriformadelprocessocivilenegliStatiUniti,30Rivista

didirittoprocessuale787(1995)199. Donovan,InvestmentTreatyArbitration,inMistelisBerman(eds.),Mandatory

RulesinInternationalArbitration233,JurishPublishing(2010)200. Donziger, Garr, Page, Rainforest Chernobyl Revisited: The Clash of Human

Rights and BIT Investor Claims: Chevron’s Abusive Litigation in Ecuador’s Amazon, 17HumanRightsBrief8(2010)

201. Douglas, The Hibryd Foundations of Investment Treaty Arbitration, 74 BritishYearbookofInternationalLaw151(2003)

202. Douglas,TheinternationalLawofInvestmentClaims,Cambridge(2009)203. Douglas, Pouwelyn, Vinuales, The foundations of investment treaty law,

OxfordUniversityPress(2014)204. Drahozal,Party Autonomy and InterimMeasures in International Commercial

Arbitration, in van den Berg (ed.), International Council for Commercial Arbitration,InternationalCommercialArbitration:ImportantContemporaryQuestions179(2003)

205. Dumberry,The Legal Standing of Shareholders Before Arbitral Tribunals: HasAny Rule of Customary International LawCrystallised?, 18Michigan State Journal ofInternationalLaw353(2010)

206. Dumberry, Valasek,Developments in the Legal Standing of Shareholders andHoldingCorporationsinInvestor-StateDispute,26ICSIDReview–FILJ34(2011)

207. Dumbrowski, Effet Utile as a Unifying Doctrine in a Costitutionally PluralistEurope,InL.Tichy,M.Potacs,T.Dumbrovsky(eds),EffetUtile93,CharlesUniversity,Prague(2014)

208. Dupuy,TheDanger of Fragmentation orUnification of the International LegalSystem and the International Court of Justice, 31 New York University Journal ofInternationalLawandPolitics791(1999)

209. Dworkin,TakingRightsSeriously,Duckworth,London(1978)210. Einhorn, The Recognition and Enforcement of Foreign Judgments on

InternationalCommercialAwards,12YearbookofPrivateInternationalLaw43(2010)211. Ellis, General Principles and Comparative Law, 22 European Journal of

InternationalLaw949(2011)212. Ellis,Nonmutuality: Taking the Fairness out of Collateral Estoppel, 13 Indiana

LawReview563(1980)213. Erk-Kubat, Parallel Proceedings in International Arbitration: A Comparative

EuropeanPerspective,Kluwer(2014)214. Etteh, Conflicting Decision in Investment Arbitration: How Do Inconsistent

Decisions Arise and How Can They Be Avoided?,http://www.dundee.ac.uk/cepmlp/gateway/files.php?file=cepmlp_car14_7_971422207

200

.pdf(2010)215. EuropeanFederationfor InvestmentLawandArbitration(EFILA),Aresponse

tothecriticismagainstISDS,17May2015(2015)216. FachGomez,RethinkingtheRoleofAmicusCuriae in International Investment

Arbitration: How to Draw the Line Favorably for the Public Interest, 35 FordhamInternationalLawJournal510(2012)

217. Fawcett (ed.),Declining Jurisdiction inPrivate International Law,OxfordOUP(1995)

218. Faya-Rodriguez, Joubin Bret, Most-Favoured-Nation Treatment, in UNCTADSeries on Issues in International Investment Agreements II,http://unctad.org/en/Docs/diaeia20101_en.pdf(2010)

219. Fazzalari,Ledifesedelterzorispettoal lodorituale,5Rivistadell’arbitrato613(1995)

220. Fellas, A Fair and Efficient Arbitration Process, in PLI’s Course Handbook,InternationalArbitration2007,www.pli.edu/emktg/all_star/intl_arb13.doc.(2007)

221. Fellas,CommentsonPartiesinInternationalArbitration:Consentv.CommercialReality by Professor Stavros Brekoulakis, Conference Materials of the School ofInternationalArbitration 30thAnniversaryConference: “The Evolution and Future ofInternationalArbitration:TheNext30Years”,Unpublished(2015)

222. Fenyvesi,ApplicationofInternationalLawasApplicableLawundertheSecondSentenceofArt42(1)inICSIDArbitration,3AdamAntalPhDtanulmanyok57(2005)

223. Feraci,L’ordinepubbliconeldirittodell’Unioneeuropea,Giuffrè,Milano(2012)224. Fernandez-Rozas, Anti-suit Injunctions Issued by National Courts: Measures

addressed to thePartiesor to theArbitrators, inGaillard (ed.)Anti-Suit Injunctions inInternationalArbitration73(2005)

225. Ferrari, Forum Shopping: A Plea for a Broad and Value-Neutral Definition,ssrn.com/abstract=2474181(2013)

226. Ferrario, The Group of Companies Doctrine in International CommercialArbitration: IsThereanyReasonforthisDoctrinetoExist?,26Journalof InternationalArbitration647(2009)

227. Feuerle, International Arbitration and Choice of Law Under Article 42 of theConvention on the Settlement of Investment Disputes, 4 Yale Studies World PublicOrder89(1977)

228. Fietta,MostFavouredNationTreatmentandDisputeResolutionUnderBilateralInvestmentTreaties:ATurningPoint?,2005 InternationalArbitrationLawReview131(2005)

229. Fisher, Anti-suit Injunctions to Restrain Foreign Proceedings in Breach of anArbitrationAgreement,22BondLawReview1(2010)

230. Fitzmaurice,TheLawandProcedureftheInternationalCourtofJustice,vol.2,(1986)

231. Forlati,“Interessedinaturagiuridica”edeffettiperglistati terzidellesentenzedellacorteinternazionalediGiustizia,96Rivistadidirittointernazionale99(2002)

232. Forlati,TheInternationalCourtofJustice:AnArbitralTribunaloraJudicialBody,Springer(2014)

233. Fortier,Renault, InterimMeasures:Anarbitrator'sProvisionalViews, FordhamLaw School Conference on International Arbitration and Mediation,http://www.arbitration-icca.org/media/0/12232952989920/1115_001.pdf(2008)

234. Fortier,Theminimum requirements of due process in takingmeasures againstdilatory tactics/ arbitral discretion in international commercial arbitration, ICCACongressSeriesn.9396(1999)

235. Foster, Striking a Balance Between Investor Protections and NationalSovereignty: The Relevance of Local Remedies in Investment Treaty Arbitration, 49ColumbiaJournalofTransnationalLaw201(2011)

201

236. Franck S., Development and Outcomes of Investment Treaty Arbitration, 50HarvardInternationalLawJournal,435(2009)

237. Franck S., The Legitimacy Crisis in Investment Traty Arbitration: PrivatizingPublicInternationalLawThroughInconsistentDecisions,73FordhamLawReview1521(2005)

238. Franck T., Legitimacy in the International System, 81 American Journal ofInternationalLaw705(1988)

239. Freeman Jalet, The Quest for the General Principles of Law Recognized byCivilizedNations–AStudy,10UCLALawReview1041(1963)

240. Friedland, Brumpton, Rabid Redux: The Second Wave of Abusive ICSIDAnnulments,27AmericanUniversityInternationalLawReview727(2012)

241. Friedman, The Preclusive Effect of Arbitral Determinations in SubsequentFederalSecuritiesLitigation,55FordhamLawReview655(1987)

242. Fumagalli, Anti-suit injunctions e arbitrato: una tutela troppo invasiva?, 15Rivistadell’arbitrato583(2005)

243. Gaeta, InherentPowersof InternationalCourtsandTribunals, inVorah,Pocar,etal.(eds.),Man’sInhumanitytoMan:EssaysinHonourofAntonioCassese353,Kluwer(2003)

244. Gaffney, 'Abuse of Process' in Investment Treaty Arbitration, 11 Journal ofWorldInvestmentandTrade515(2010)

245. Gafni, Res Judicata, Collateral Estoppel and Arbitration, 243 The LegalIntelligencer(2011)

246. Gaillard, Anti-suit Injunctions Issued by Arbitrators, in van den Berg (ed.)InternationalArbitration2006:BacktoBasics?,13ICCACongressSeries235(2007)

247. Gaillard,GeneralPrinciplesofLawinInternationalArbitration–ChallengingtheMyths,5WorldArbitration&MediationReview161(2011)

248. Gaillard,LegalTheoryofInternationalArbitration,MartinusNijhoff(2010)249. Gaillard, Reflections on the Use of Anti-suit Injunctions in International

Arbitration, inMistelis and Lew,Pervasive Problems in International Arbitration, TheHague,KluwerInternational,203(2006)

250. Gaillard, The Extent of Review of the Applicable Law in Investment TreatyArbitration, in Gaillard, Banifatemi (eds.),Annulment of ICSID Awards, IAI Series onInternationalArbitrationN°1223,Juris(2004)

251. Gaillard, Vivendi and BIT arbitration, www.transnational-dispute-management.com(2004)

252. Gaillard,Banifatemi,TheMeaningof"and"inArticle42(1),SecondSentence,oftheWashingtonConvention:TheRoleof InternationalLaw in the ICSIDChoiceofLawProcess,18ICSIDReview–FILJ375(2003)

253. Gaillard, Pinsolle, Advocacy in Practice: the Use of Parallel Proceedings, inBishop,Kehoe(ed.),TheArtofAdvocacyinInternationalArbitration–SecondEdition173,Juris(2010)

254. Gaja,ConvenzionediNewYorksull’arbitratoeanti-suit injunctions,103Rivistadidirittointernazionale503(2009)

255. Gaja,GeneralPrinciplesof Law, inWolfrum (ed.)MaxPlanckEncyclopediaofPublicInternationalLaw,onlineedition,OxfordUniversityPress(2008)

256. Gaja,Relationship of the ICJwithOther International Courts andTribunals, inZimmerman,Tomuschat,Oellers-Frahm,Tams(eds.),TheStatuteoftheInternationalCourtofJustice,OxfordOUP(2012)

257. Gal, The Commercial Law of Nations and the Law of International Trade, 6CornellJournalofInternationalLaw55(1972)

258. Gallagher, Parallel Proceedings, Res Judicata and Lis Pendens: Problems andPossibleSolutions,inMistelisandLew,PervasiveProblemsinInternationalArbitration,TheHague,KluwerInternational,2006,329

202

259. Gallus, State Enterprises asOrgans of the State and BIT Claims, 7 Journal ofWorldInvestmentandTrade761(2006)

260. Gardiner,TreatyInterpretation,Oxford(2008)261. Gastrell, LeCannu,Procedural Requirements of ‘Denial of Benefits’ Clauses in

InvestmentTreaties:AReviewofArbitralDecisions,30ICSIDReviewFILJ78(2015)262. Gaukrodger, Investment treaties as corporate law: Shareholder claims and

issues of consistency. A preliminary framework for policy analysis, OECD WorkingPapers on International Investment, No. 2013/3, OECD Investment Division,www.oecd.org/investment/working-papers.htm.

263. Gazzini,GeneralPrinciplesofLawintheFieldofForeignInvestment,10JournalofWorldInvestmentandTrade103(2009)

264. Geiger,TheMultifaceted Nature of International Investment Law, in Sauvant(ed.)AppealsMechanisminInternationalInvestmentDisputes17,Oxford(2008)

265. Georgilas,AbuseofRights inmodernInternational InvestmentArbitration:TheRuleofLawRevisited?,ILARegionalConference2013,Greece(2013)

266. Gestri,Abusodeldirittoefrodeallaleggenell’ordinamentocomunitario,Giuffré,Milano(2003)

267. Gestri, Considerazioni sulla teoria dell’abuso del diritto alla luce della prassiinternazionale,88Rivistadidirittointernazionale5(1994)

268. Ghirga,Lameritevolezzadellatutelarichiesta,Giuffré,Milano(2004)269. Ghosh, An uncertain shield: res judicata in arbitration, 31 Arbitration

International661(2015)270. Giardina, International InvestmentArbitration:RecentDevelopmentsas to the

ApplicableLawandUnilateralRecourse,5LawandPracticeofInternationalCourtsandTribunals29(2006)

271. Giardina,LaleggeregolatricedeicontrattidiinvestimentonelsistemaICSID,23Rivistadidirittointernazionaleprivatoeprocessuale677(1982)

272. Gilchrist, The Res Judicata Standard of Confirmed Arbitration Awards inWisconsin,1987WisconsinLawReview895(1987)

273. Gillies, Hymel,Unifying Competing Dispute Resolution Processes into a One-StopArbitration,17AsiaPac.L.Rev.169(2009)

274. Giorgetti, Caratube v. Kazakhstan: For the First Time Two ICSID ArbitratorsUphold Disqualification of Third Arbitrator,http://www.asil.org/insights/volume/18/issue/22/caratube-v-kazakhstan-first-time-two-icsid-arbitrators-uphold(2014)

275. Giorgetti, Horizontal and Vertical Relationships of International Courts andTribunals-HowDoWeAddressTheirCompetingJurisdiction?,30ICSIDReview–FILJ98(2015)

276. Giorgetti,MassTortClaims in International InvestmentProceedings:Whatarethe Lessons from the Ecuador-ChevronDispute?, 34 Journal of International Law 787(2013)

277. Godwin, Dealing with Multi-Party and Multi-Contract Arbitration Issues,http://www.herbertsmithfreehills.com/-/media/HS/T-060612-18.pdf(2012)

278. Goldhaber,TheRiseofArbitralPowerOverDomesticCourts,1StanfordJournalofComplexLitigation373(2013)

279. Gomez Carriòn, Joinder of third parties: new institutional developments, 31ArbitrationInternational479(2015)

280. Gordon, Only One Kick at the Cat: A Contextual Rubric for Evaluating ResJudicata and Collateral Estoppel in International Commercial Arbitration, 18 FloridaJournalofInternationalLaw549(2006)

281. Gotanda, An Efficient Method for Determining Jurisdiction in InternationalArbitrations,40ColumbiaJournalofTransnationalLaw11(2001)

282. Gottlieb, Res Judicata and Collateral Estoppel Beneath Corporate Veil, 66

203

CaliforniaLawReview1093(1978)283. Gouiffés,Ordonez,Jurisdictionandadmissibility:areweanycloser toa line in

thesand?,31ArbitrationInternational107(2015)284. Gradi,Adesionedel litisconsortenecessariopretermessoalcollegioarbitralegià

costituitoedissensodiunodeilitisconsortioriginari:uno“stranocaso”diimprocedibilitàdell’arbitrato,37GiustiziaCivile2863(2012)

285. Gradi, Commento all’art. 816 quater, in Consolo, Comoglio, Sassani (eds.),CommentariodelCodicediproceduracivile,vol.7,366,(2014)

286. Gradi, L’intervento volontario e la chiamata in causa dei terzi nel processoarbitrale,19Rivistadell’arbitrato283(2010)

287. Gribnau,Legitimacyof the judiciary,6ElectronicJournalofComparativeLaw26,http://www.ejcl.org/64/art64-3.pdf(2002)

288. Guglya, The Interplay of International Dispute Resolution Mechanisms/ theSoftwood Lumber Controversy, 2 Journal of International Dispute Settlement 175(2011)

289. Guillaume,TheFutureofInternationalJudicialInstitutions,44InternationalandComparativeLawQuarterly848(1995)

290. Gunes, Res Judicata in International Arbitration: To What Extent Does anArbitral Award Prevent the Re-Litigation of Issues?, 12 Transnational DisputeManagement(2015)

291. Habegger, Arbitration and Groups of Companies – The Swiss Practice, 3EuropeanBusinessOrganizationLawReview517(2002)

292. Hackman,TheProblemofArbitrationandMulti-Party/Multi-ContractDisputes:Is Court-Ordered Consolidation an Adequate Response?,http://www.dundee.ac.uk/cepmlp/gateway/files.php?file=cepmlp_car13_5_612306438.pdf(2009)

293. Hale,BetweenInterestsandLaw,CambridgeUniversityPress(2015)294. Hahn,ResJudicataasaChallengeforArbitralTribunals, inAustrianYearbook

onInternationalArbitration329(2014)295. Hallward-Driemeier,DoBilateralInvestmentTreatiesAttractFDI?OnlyaBIT…

andTheyCouldBite,ssrn.com/abstract=636541(2003)296. Hanotiau, A new development in Complex Multiparty-Multicontract

Proceedings:ClasswideArbitration,20ArbitrationInternational39(2004)297. Hanotiau, Complex Arbitrations: Multiparty, Multicontract, Multi-Issue and

ClassActions,KluwerLawInternational(2006)298. Hanotiau,Groups of Companies in International Arbitration, in Mistelis, Lew

(eds.),PervasiveProblems in InternationalArbitration279,KluwerLawInternational(2006)

299. Hanotiau,MultiplePartiesandMultipleContractsinInternationalArbitration,inPermanent Court of Arbitration (ed.) Multiple Party in International Arbitration 1,OxfordUniversityPublishing(2009)

300. Hanotiau, Non-signatories in International Arbitration: Lessons from ThirtyYears of Case Law, in van den Berg (ed.) International Arbitration 2006: Back toBasics?,13ICCACongressSeries341(2007)

301. Hanotiau, Problems Raised by Complex Arbitrations Involving MultipleContracts-Parties-Issues – An Analysis, 18 Journal of International Arbitration 253(2001)

302. Hansen,ParallelProceedingsinInvestor-StateTreatyArbitration:ResponsesforTreaty-Drafters,ArbitratorsandParties,73ModernLawReview523(2010)

303. Hariharan, Distinction between Treaty and Contract The Principle ofProportionality in State Contractual Actions in Investment Arbitration, 14 Journal ofWorldInvestmentandTrade1019(2013)

304. Hart,TheConceptofLaw(2nded.),ClarendonLawSeries(1994)

204

305. Hartley,ComityandtheUseofAntisuitInjunctionsinInternationalLitigation,35TheAmericanJournalofComparativeLaw487(1987)

306. Hartley, International Commercial Litigation, Cambridge University Press(2015)

307. Hascher, Consolidation of Arbitration by American Courts: Fostering orHamperingInternationalCommercialArbitration?,1JournalofInternationalArbitration127(1984)

308. Haynes,TheEmergenceof aDoctrineof de jurehorizontal staredecisis at theCaribbeanCourtofJustice:FragmentationorPluralismofInternationalLaw?,5JournalofInternationalDisputeSettlement498(2014)

309. He, Public Policy in Enforcement of Foreign Arbitral Awards in the SupremePeople’sCourtofChina,43HongKongLawJournal1037(2013)

310. Heinsz,GrieveItAgain:ofStareDecisis,ResJudicataandCollateralEstoppelinLaborArbitration,38BostonCollegeLawReview275(1997)

311. Heintzman, What Is The Effect Of Res Judicata On Arbitration?,http://www.heintzmanadr.com/arbitaral-award/what-is-the-effect-of-res-judicata-on-arbitration/(2014)

312. Heiser,ForumNonConveniens andRetaliatory Legislation: The Impact on theAvailableAlternativeForumInquiryandontheDesirabilityofForumNonConveniensasaDefenseTactic,56KansasLawReview609(2008)

313. Heiskanen, Arbitrating Mass Investor Claims: Lessons of International ClaimsCommissions, inPermanentCourtofArbitration (ed.)MultipleParty in InternationalArbitration297,OxfordUniversityPublishing(2009)

314. Heiskanen, Key to Efficiency in International Arbitration,www.kluwerarbitrationblog.com(2015)

315. Heiskanen, Menage a trois? Jurisdiction, Admissibility and Competence inInvestmentTreatyArbitration,28ICSIDReview–FILJ1(2013)

316. Henry, Investment Agreement Claims under the 2004 Model U.S. Bit: AChallenge for State Police Powers, 31 University of Pennsylvania Journal ofInternationalLaw935(2010)

317. Hicks,ParallelLitigationinForeignandFederalCourts:IsForumNonConvenienstheAnswer?,28ReviewofLitigation659(2009)

318. Hill,TheSignificanceofForeignJudgmentsRelatingtoanArbitralAwardintheContext of an Application to Enforce the Award in England, 8 Journal of PrivateInternationalLaw159(2012)

319. Hill,TowardsGlobalConvenience,FairnessandJudicialEconomy:AnArgumentinSupportof JudicialForumNonConveniensDismissalBeforeDeterminingJurisdictionin United States Federal District Courts, 41 Vanderbilt Journal of Transnational Law1177(2008)

320. Hill,Chong,InternationalCommercialDisputes,HartPublishing(2010)321. Hirsch,TheSociologyofInternationalInvestmentLaw,TheHebrewUniversity

ofJerusalemResearchPaperNo.13-13(2013)322. Hober, Res Judicata and Lis Pendens in International Arbitration, Recueil de

coursesvol.366103(2013)323. Hoellering,ConsolidatedArbitration,DisputeResolutionJournal41(1997)324. Hoffmann,The Investor Right toWaiveAccess to Protection under aBilateral

InvestmentTreaty,22ICSIDReviewFILJ69(2007)325. Holloway,AvoidingDuplicative Litigation aboutArbitrationAwardswithin the

EU,2JournalofInternationalDisputeSettlement435(2011)326. Horn, A Matter of Appearances: Arbitrator Independence and Impartiality in

ICSIDArbitration,11NewYorkUniversityJournalofLawandBusiness349(2014)327. Hosking, The Third Party Non-Signatory's Ability to Compel International

Commercial Arbitration/ Doing Justice without Destroying Consent, 4 Pepperdine

205

DisputeResolutionLawJounal469(2004)328. Houde, Most-Favoured-Nation Treatment in International Investment Law,

OECD Papers on International Investment No. 2004/2,http://www.oecd.org/daf/inv/investment-policy/WP-2004_2.pdf(2004)

329. Hugues Arthur, The Legal Value of Prior Steps to Arbitration in InternationalLaw of Foreign Investment: Two (Different?) Approaches, One Outcome, 15 AnuarioMexicanodeDerechoInternacional449(2015)

330. Hulbert,ArbitralProcedureandthePreclusiveEffectofAwardsinInternationalCommercialArbitration,7InternationalTaxandBusinessLawyer155(1990)

331. Hunter, Conde Silva, Transnational Public Policy and its Application inInvestmentArbitrations,4JournalofWorldInvestment367(2003)

332. Iluyomade, The Scope and Content of a Complaint of Abuse of Right inInternationalLaw,16HarvardInternationalLawJournal47(1975)

333. Iovane, Metodo costituzionalistico e ruolo dei giudici nella formulazione deiprincipigeneralideldirittointernazionale,13ArsInterpretandi103(2008)

334. Jagush,Sinclair,TheImpactofThirdPartiesinInternationalArbitration–IssuesofAssignment,inMistelis,Lew(eds.),PervasiveProblemsinInternationalArbitration279,KluwerLawInternational(2006)

335. Jansen Calamita, Rethinking Comity: Towards a Coherent Treatment ofInternationalParallelProceedings,27U.Pa.JournalofInternationalEconomicLaw601(2006)

336. Jeydel,Consolidation, Joinder, Class Actions, 57Dispute Resolution Journal 2(2004)

337. Juenger,ForumShopping,Domesticand International,63TulaneLawReview5531988-1989

338. Juillard, Variation in the Substantive Provisions and Interpretation ofInternational Investment Agreements, in Sauvant (ed.) Appeals Mechanism inInternationalInvestmentDisputes81,Oxford(2008)

339. Juratowitch,ForaNonConveniensForEnforcementOfArbitralAwardsAgainstStates,63InternationalandComparativeLawQuarterly477(2014)

340. Kabra,Has Abaclat v Argentina left the ICSID with a ‘mass’ive problem?, 31ArbitrationInternational425(2015)

341. Kahn, The Law Applicable To Foreign Investments: The Contribution of theWorld Bank Convention on the Settlement of Investment Disputes, 44 Indiana LawJournal1(1968)

342. Karadelis, ICSID arbitrator disqualified by co-panelists,www.globalarbitrationreview.com(2014)

343. Kaufmann-Kohler, Arbitral Precedent: Dream, Necessity or Excuse?, 23ArbitrationInternational357(2007)

344. KaufmannKohler,HowtoHandleParallelProceedings:APracticalApproachtoIssuessuchasCompetence-CompetenceandAnti-SuitInjunctions,2DisputeResolutionInternational(2008)

345. Kaufmann-Kohler, Interpretation of Treaties: How Do Arbitral TribunalsInterpret Dispute Settlement Provisions Embodied in Investment Treaties, in Mistelis,Lew,PervasiveProblemsinInternationalArbitration257,Kluwer(2006)

346. Kaufmann-Kohler, Is Consistency a Myth?, in Gaillard, Banifatemi (eds.)PrecedentinInternationalArbitration136,Juris(2008)

347. Kaufmann-Kohler,TheArbitratorandtheLaw:DoesHe/SheKnowit?Applyit?How?AndaFewMoreQuestions,21ArbitrationInternational631(2005)

348. Kaufmann-Kohler,TheRelationshipBetween InternationalArbitrationand theNationalJudge:Introduction,invandenBerg(ed.)ICCACongressSeries17399(2013)

349. Kaufmann-Kohler, Antonietti, Interim Relief in International InvestmentAgreement, in Yannaca-Small (ed.), Arbitration Under International Investment

206

Agreements:AGuidetoKeyIssues507,OxfordOUP(2010)350. Kaufmann-Kohler,BoissondeChazournes,Bonnin,Mbengue,Consolidationof

Proceedings in InvestmentArbitration:How canMultipleProceedingsArising from theSameorRelatedSituationsBeHandledEfficiently?,21ICSIDReviewFILJ59(2006)

351. Kazutake, Party Autonomy in International Commercial Arbitration:ConsolidationofMultipartyandClasswideArbitration,9AnnualSurveyofInternational&ComparativeLaw189(2003)

352. Kelsen,IntroductiontotheProblemsofLegalTheory,Oxford(1934reprintedin1992)

353. Kerner,FederalCourtsLack thePower toConsolidateArbitrationProceedings,Baesler v. Continental Grain Co., 900 F.2d 1193 (8th Cir. 1990), 69 WashingtonUniversityLawQuarterly349(1991)

354. Kirby, Efficiency in International Arbitration:Whose Duty Is it?, 32 Journal ofInternationalArbitration689(2015)

355. Kirtley, The Transfer of Treaty Claims and Treaty-Shopping in Investor-StateDisputes,10JournalofWorldInvestmentandTrade427(2009)

356. Kjos, Applicable Law in Investor State Arbitration, Oxford University Press(2013)

357. Klafter, International Commercial Arbitration As Appellate Review: Nafta’sChapter11,ExhaustionofLocalRemediesandResJudicata,12UniversityofCalifornia,Davis409(2006)

358. Klein,HowtoAvoidConflictingAwards:TheLauderandCMECases,5JournalofWorldInvestmentandTrade19(2004)

359. Koch, International Forum Shopping and Transnational Lawsuits, 31 TheGenevaPapers293(2006)

360. Koch,Diedrich,CivilProcedureinGermany,Beck,Munich(1998)361. Kolb, General Principles of Procedural Law, in Zimmerman, Tomuschat,

Oellers-Frahm,Tams (eds.),TheStatute of the International Court of Justice,OxfordOUP(2012)

362. Kolb,Lamaximedela“bonneadministrationdelajustice”danslajurisprudenceinternationale,27L’ObservateurdesNationsUnies5(2009)

363. Kolb,PrinciplesasSourcesofInternationalLaw(withSpecialReferencetoGoodFaith),53NetherlandsInternationalLawReview1(2006)

364. Kotuby, Egerton-Vernon, Apotex Holdings Inc and Apotex Inc v. TheGovernmentoftheUnitedStatesofAmerica:TheAdoptionbyInternationalTribunalsofa Substantive/Transactional Approach to Res Judicata – A New Paradigm inInternationalDisputeResolution?,30ICSIDReviewFILJ486(2015)

365. Kotzur,GoodFaith (Bona Fide), inWolfrum (ed.)MaxPlanckEncyclopedia ofPublicInternationalLaw,onlineedition(2009)

366. Koutoglidou,MultiplePartyInvestmentDisputeResolution:WhoaretheProperParties?, in Permanent Court of Arbitration (ed.) Multiple Party in InternationalArbitration1,OxfordUniversityPublishing(2009)

367. Kreindler,Arbitral Forum Shopping, in Cremades, Lew (eds.), Parallel StatesandArbitralProceduresinInternationalArbitration,ICCPublication153(2005)

368. Kriebaum, Illegal Investments, in Klausegger, Klein et al. (eds.), AustrianArbitrationYearbook2010307,C.H.Beck,Stämpfli&Manz(2010)

369. Kryvoi,PiercingtheCorporateVeilinInternationalArbitration,1GlobalBusinessLawReview169(2011)

370. Kuhn,HowtoAvoidConflictingAwards:TheLauderandCMECases,5JournalofWorldInvestmentandTrade17(2004)

371. Kumm,TheLegitimacyof InternationalLaw:AConstitutionalistFrameworkofAnalysis,15EuropeanJournalofInternationalLaw907(2004)

372. Kurkela, Due Process in Arbitration: A Finnish Perspective, 21 Journal of

207

InternationalArbitration221(2004)373. Kurkela, ‘Jura Novit Curia’ and the Burden of Education in International

Arbitration–ANordicPerspective,21ASABulletin486(2003)374. Kurtz,BuildingLegitimacyThroughInterpretation in Investor-StateArbitration:

On Consistency, Coherence and the Identification of Applicable Law,http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2325189(2013)

375. Lacovara,ClassActionArbitrations–theChallengefortheBusinessCommunity,24ArbitrationInternational541(2009)

376. Laitinen, Multi-Party and Multi-Contract Arbitration Mechanisms inInternational Commercial Arbitration, Doctoral thesis – University of Helsinki,https://helda.helsinki.fi/bitstream/handle/10138/44922/klaslaitinenprogradu.pdf?sequence=2(2013)

377. Lalive,TheFirst‘WorldBank’Arbitration(HolidayInnsv.Morocco)–SomeLegalProblems,51BritishYearbookofInternationalLaw123(1980)

378. Lalive, Transnational (or Truly International) Public Policy and InternationalArbitration,inSanders(ed)ICCACongressSeriesNo.3257(1986)

379. Lamberti Zanardi, Il procedimento sule eccezioni preliminari nel processodavanti alla corte internazionale di giustizia, 59 Rivista di diritto internazionale 537(1965)

380. Lamm,Aqua,Defining the Party –Who is a Propert Party in an InternationalArbitration Before the American Arbitration Association and Other InternationalInstitutions,34GeorgeWashingtonInternationalLawReview711(2002-2003)

381. Lamm,Greenwald,Young,FromWorldDutyFree toMetal-Tech:AReviewofInternational Investment Treaty Arbitration Cases Involving Allegations of Corruption,29ICSIDReviewFILJ328(2014)

382. Lammers, General Principles of Law Recognized by Civilized Nation, inKalshoven, Kuyper, Lammers (eds.),Essays on theDevelopment of the InternationalLegalOrderinmemoryofHaroF.vanPanhuys,Sijthoff&Noordhoff(1980)

383. Lauterpacht,TheDevelopmentofInternationalLawbytheInternationalCourt,CambridgeUniversityPress(1958reprinted2010)

384. Lauterpacht,TheFunctionofLawinTheInternationalCommunity,OxfordOUP(firstpublished1933,2010edition)

385. Leandro, Le anti-suit injunctions a supporto dell’arbitrato: daWest Tankers aGazprom,110Rivistadidirittointernazionale815(2015)

386. Leboulanger,Multi-ContractArbitration,13JournalofInternationalArbitration43(1996)

387. Lelieur, ‘Transnationalising’ Ne Bis In Idem: How the Rule of Ne Bis In IdemRevealsthePrincipleofPersonalLegalCertainty,9UtrechtLawReview198(2013)

388. Leo,L’abusodelprocessonellagiurisprudenzadilegittimità,14Dirittopenaleeprocesso508(2008)

389. Lettieri, Marini, Merone, L’abuso del diritto nel dialogo tra corti nazionali edinternazionali,EdizioniScientificheItaliane(2014)

390. Levine,AmicusCuriae in International InvestmentArbitration:The Implicationsof an Increase in Third-Party Participation, 29 Berkeley Journal of International Law200(2011)

391. Levy,Anti-suit Injunctions IssuedbyArbitrators, 2 IAI InternationalArbitrationSeries115,(2005)

392. Lew,ApplicableLawinInternationalCommercialArbitration,Oceana(1978)393. Lew,ConcludingRemarks,inCremades,Lew(eds.),ParallelStateandArbitral

ProceduresinInternationalArbitration358,Juris(2007)394. Lew,IuraNovitCuriaandDueProcess,ssrn.com/abstract=1733531(2010)395. Lew,TheCase forPublicationofArbitrationAwards, inTheartofArbitration,

LiberAmicorumPieterSanders,Kluwer(1982)

208

396. Lew, Mistelis, Kroll, International and Comparative Commercial Arbitration,Kluwer,TheHague(2003)

397. Liebman,Efficaciaedautoritadellasentenza,Giuffré,Milano(1983)398. Lillich, International law od State responsibility for injury to aliens,

Charlottesville(1983)399. Linton,Tiba,TheInternationalJudgeinanAgeofMultipleInternationalCourts

andTribunals,9ChicagoJournalofInternationalLaw407(2009)400. Litvinoff,GoodFaith,71TulaneLawReview1645(1997)401. Lo,PrinciplesandCriteria for InternationalandTransnationalPublicPolicies in

CommercialArbitration,1ContemporaryAsiaArbitrationJournal67(2008)402. Lo,RelationsandPossibleInteractionsBetweenState-StateDisputeSettlement

and Investor-StateArbitrationUnderBITs,6ContemporaryAsiaArbitrationJournal1(2013)

403. Loong, Arbitration of Investment Disputes: The Order of the ConsolidationTribunal in the Softwood Lumber Dispute, 24 Journal of International Arbitration 81(2007)

404. Losurdo, Ildivietodell’abusodeldirittonell’ordinamentoeuropeo,Giappichelli,Torino(2011)

405. Lowe, Overlapping Jurisdiction in International Tribunals, 20 AustralianYearbookofInternationalLaw191(1999)

406. Lowe,Res Judicataand theRuleofLaw in InternationalArbitration,8AfricanJournalofInternational&ComparativeLaw38(1996)

407. Lowe,TheManifoldRespondent:MultipartyIssuesInvolvingStatesinInvestor-State Arbitration, in Permanent Court of Arbitration (ed.) Multiple Party inInternationalArbitration1,OxfordUniversityPublishing(2009)

408. Lowenfeld,Alex Genin, Eastern Credit Ltd., and AS Baltoil v the Republic ofEstonia - Declaration of Professor Andreas F. Lowenfeld,www.transnationaldisputemanagement.com(2006)

409. Luiso,Pluralitàdiclausolecompromissorieeunitarietàdelprocessoarbitrale,17Rivistadell’Arbitrato604(2007)

410. Luiso, Principio del contraddittorio ed efficacia della sentenza verso terzi,Giuffré,Milano(1981)

411. Luparia,Lalitispendenzainternazionale,Giuffré(2012)412. Luttrell, ICSIDprovisionalmeasures ‘intheround’,31Arbitration International

393(2015)413. Lyons,PiercingtheCorporateVeil intheInternationalArena,33SyracuseJ.Of

Int’l&Comp.Law523(2005-2006).414. Ma, Parallel Proceedings and International Commercial Arbitration: the

InternationalLawAssociation’sRecommendationsforArbitrators,2Contemp.AsiaArb.J.49(2009)

415. Magnani,Nuoveprospettivesuiprincipigeneralinelsistemadellefontineldirittointernazionale,Mursia(1997)

416. Maloy,ForumShopping?What'swrongwiththat?,24QLR25(2005-2006)417. Maniruzzaman,TheConceptofGoodFaithinInternationalInvestmentDisputes

– The Arbitrator’s Dilemma, 89 Amicus Curiae: Journal of the Society for AdvancedLegalStudies16(2012)

418. Mann,ForeighAffairsinEnglishCourts,OxfordOUP(1986)419. Mann, Reflections on a Commercial Law of Nations, 33 British Yearbook of

InternationalLaw20(1957)420. Mantilla Serrano, Multiple Parties and Multiple Contracts: Divergent or

Comparable Issues?, inSchwartz,Hanotiau (eds.),MultipartyArbitration,DossiersoftheICCInstituteofWorldBusinessLaw11(2010)

421. Marboe, ICSID Annulment Decisions: Three Generation Revisited, in Binder,

209

Kriebaum,Reinisch,Wittich(eds.), InternationalInvestmentLawforthe21stCentury:EssaysinHonourofChristophSchreuer200,OxfordUniversityPress(2009)

422. Martin, International investmentdisputes,nationalityandcorporateveil: someinsightsfromTokiosTokelesandTSASpectrumdeArgentina,8TransnationalDisputeManagement,Issue1,(2011)

423. Martinez Fraga, Samra, The Role of Precedent in Defining Res Judicata inInvestor–StateArbitration,32NorthwesternJournalofInternationalLawandBusiness419(2012)

424. Mauro,Gli accordi bilaterali sulla promozione e protezione degli investimenti,GiappichelliTorino(2003).

425. Mayer,ExtensionoftheArbitrationClausetoNon-signatoriesunderFrenchLaw,inPermanentCourtofArbitration(ed.),MultiplePartyinInternationalArbitration189,(2009)

426. Mayer, Table ronde: Le système actuel est-il déséquilibré en faveur del’investisseur privé étranger at au detriment de l’Etat d’Accueil?, in Leben (ed.) Lecontentieux arbitral transnational relative à l’investissement 195, Louvain-la-Neuve,Anthemis(2006)

427. Mayer,TheEffectofAwardsRenderedinMultiparty/MulticontractSituations,inSchwartz, Hanotiau (eds.), Multiparty Arbitration, Dossiers of the ICC Institute ofWorldBusiness223(2010)

428. McCarthy,TheProblemsofFragmentationandDiversificationintheResolutionofComplexInternationalClaims,17JournalofWorldInvestment&Trade140(2016)

429. McDougall,Markbaoui,CaseNotetoConocoPhillipsPetrozuata,ChonoPhillipsHamacaBVandConocoPhillipsGulfofPariaBVv.BolivarianRepublicofVenezuela,15JournalofWorldInvestmentandTrade1062(2014)

430. McGibbon,EstoppelinInternationalLaw,7InternationalandComparativeLawQuarterly468(1958)

431. Mcllwrath, Moolan, Joinder, Current Practice in International Arbitration,www.transnational-dispute-management.com(2005)

432. McLachlan,LisPendens in InternationalLitigation,PublicationsofTheHagueAcademyofInternationalLaw,(2009)

433. McLachlan, Shore, Weiniger, International Investment Arbitration, OxfordUniversityPress(2007)

434. McNair, The General Principles of Law Recognized by Civilized Nations, 33BritishYearbookofInternationalLaw1(1957)

435. Menchini,Sull’attitudine al giudicato sostanziale del lodo non più impugnabilenonassistitodallaomologagiudiziale,8Rivistadell’arbitrato773(1998)

436. Meyers, In Defense of the International Treaty Arbitration System,works.bepress.com/Daniel_meyers/2(2008)

437. Merusi,Buonafedeeaffidamentoneldirittopubblico,Giuffré(2001)438. Millar,TheHistoricalRelationofEstoppelbyRecordtoResJudicata,35 Illinois

LawReviewofNorthwesternUniversity41(1940)439. Millar,ThePremisesoftheJudgmentasResJudicatainContinentalandAnglo-

AmericanLaw,39MichiganLawReview1(1940)440. Miller, An International Jurisprudence? The Operation of “Precedent” Across

InternationalTribunals,15LeidenJournalofInternationalLaw483(2002)441. Miller, Consolidation in Hong Kong: The Shui On case, 3 Arbitration

International87(1987)442. Mistelis, Confidentiality and Third Party Participation, 21 Arbitration

International211(2005)443. Mistelis,Baltag,DenialofBenefitsandArticle17oftheEnergyCharterTreaty,

113PennStateLawReview1301(2009)444. Mistelis,Mandatory Rules in International Arbitration: TooMuch Too Early or

210

Too Little Too Late, in Mistelis, Berman (eds.), Mandatory Rules in InternationalArbitration233,JurishPublishing(2010)

445. Mitchell, Good Faith in WTO Dispute Settlement, 7 Melbourne Journal ofInternationalLaw339(2006)

446. Mitchell, Heaton, The Inherent Jurisdiction of WTO Tribunals: The SelectApplicationofPublic International LawRequiredby the Judicial Function, 31MichiganJournalofInternationalLaw561(2010)

447. Monichino, Fawke, Parallel Litigation and Arbitration, an abuse of process?,2012AsianDR121(2012)

448. Moore, Currier,Mutuality and Conclusiveness of Judgments, 35 Tulane LawReview301(1961)

449. Moreland, “Foreign Control” and “Agreement” Under ICSID Article 25 (2) (b):StandardsforClaimsBroughtbyLocallyOrganizedSubsidiariesagainstHostStates,9CurrentsInt’lTradeLawJ.18(2000)

450. Morelli,Questioni preliminari nel processo internazionale, 65 Rivista di dirittointernazionale5(1971)

451. Morelli,Eccezionipreliminarydimerito?,69Rivistadidiritto internazionale5,(1975)

452. Morris,NonpartiesandPreclusionbyJudgment:TheprivityRuleReconsidered,56CaliforniaLawReview1098(1968)

453. Mosk, Nelson, The effects of Confirming and Vacating an InternationalArbitrationAwardonEnforcement in Foreign Jurisdictions, 18 Journal of InternationalArbitration463(2001)

454. Motomura, Arbitration and Collateral Estoppel: Using Preclusion to ShapeProceduralChoices,63TulaneLawReview29(1988)

455. Muroni, Il conflitto pratico tra lodi e la Convenzione di New York, 9 Rivistadell’arbitrato755(2000)

456. NadakavukarenSchefer,InternationalInvestmentLaw,EdwardElgar(2013)457. Nair, Ludwig, ICSID Annulment Awards: The Fourth Generation?,

http://www.lexology.com/library/detail.aspx?g=7218cb56-7a64-426f-8cc0-8475303444e6(2011)

458. Nazzini, Remedies at the Seat and Enforcement of International ArbitrationAwards: Res Judicata, Issue Estoppel and Abuse of Process in English Law, 7ContemporaryAsiaArbitrationJournal139(2014)

459. Nesin,TheBenefits ofApplying IssuePreclusion to Interlocutory Judgments inCasesThatSettle,76NewYorkUniversityLawReview874(2001)

460. Newcombe,InvestorMisconduct:Jurisdiction,admissibilityormerits?,inBrown,Miles(eds.)EvolutioninInvestmentTreatyArbitration187,CambridgeUniversityPress(2011)

461. Nguyen, The Applicability of Res Judicata and Lis Pendens in World TradeOrganisationDisputeSettlement,25BondLawReview123(2013)

462. Nicklisch, Multi-Parti Arbitration and Dispute Resolution in Major IndustrialProjects,11JournalofInternationalArbitration57(1994)

463. Nigro,Prosperi,L’irragionevoleduratadeiprocessi,Experta(2009)464. Nolan, Sourgens, Issues of Proof ofGeneral Principles of Law in International

Arbitration,3WorldArbitrationandMediationReview505(2009)465. Obadia, ICSID, Investment Treaties and Arbitration: Current and Emerging

Issues, in Kaufmann Kohler, Stucki (eds.), Investment Treaties and Arbitration 67,SwissArbitrationAssociation,Zurich,SpecialSeries,No.19(2002)

466. Oberstainer, “In Accordance with Domestic Law” Clauses: How InternationalInvestmentTribunalsDealwithAllegationsofUnlawfulConductofInvestors,31JournalofInternationalArbitration265(2014)

467. O’Connor,GoodFaithinInternationalLaw,DartmouthPublishing(1991)

211

468. Oellers-Frahm, Multiplication of International Courts and Tribunals andConflicting Jurisdiction — Problems and Possible Solutions, 5 Max Panck UNYB 67(2001)

469. Oghigian,Ohara,HowToDealWithZeus—AdvocacyOfParallelProceedingsfrom an Investor’s Perspective,http://www.bakermckenzie.co.jp/e/material/dl/supportingyourbusiness/articles/201011_LexisNexis.pdf(2011)

470. Okekeifere,Public Policy andArbitrability under theUNCITRALModel Law, 2InternationalArbitrationLawReview71(1999)

471. Okobi,TheUmbrellaClause:APanaceaForContractual Instability?ALookatProduction Sharing Contracts,http://www.dundee.ac.uk/cepmlp/gateway/files.php?file=CAR-12_43_673776155.pdf(2008)

472. Olatawura,The“PrivytoArbitration”Doctrine:TheWitheringof theCommon-Law Privity of Contract Doctrine in Arbitration Law, 16 The American Review ofInternationalArbitration429(2005)

473. Orakhelashvili, Judicial Competence and Judicial Remedies in theAvenaCase,18LeidenJournalofInternationalLaw31(2005)

474. Orakhelashvili, Peremptory Norms in International Law, Oxford UniversityPress(2008)

475. OrregoVicuna,LisPendensArbitralis,inCremades,Lew(eds.),ParallelStatesandArbitralProceduresinInternationalArbitration207,ICCPublication(2005)

476. Ortolani, Anti-suit Injunctions in Support of Arbitration Under the RecastBrusselsIRegulation,6MPILuxWokingPaper1(2015)

477. Ottolenghi, Prows, Res Judicata in the ICJ's Genocide Case/ Implications forOtherCourtsandTribunals?,21PaceInternationalLawReview37(2009)

478. Ovchar,EstoppelintheJurisprudenceoftheICJ:APrinciplePromotingStabilityThreatenstoUndermineIt,21BondLawReview1(2009)

479. Pair,Consolidationininternationalcommercialarbitration,eleveninternationalpublishing(2012)

480. Pair,Frankenstein,TheNewICCRuleonConsolidation:ProgressorChange?,25EmoryInternationalLawReview1061(2011)

481. Palchetti, Opening the International Court of Justice to Third States:InterventionandBeyond,6MaxPlanckUNYB139(2002)

482. Palombino,Glieffettidellasentenzainternazionaleneigiudiziinterni,Editorialescientifica,Napoli(2008)

483. Palombino,Ilpotereinerentediriesamedeitribunaliinternazionali:inmarginealcasoCelibici,59LaComunitàInternazionale707(204)

484. Palombino, Il trattamentogiustoedequodegli investimenti stranieri, IlMulino(2012)

485. Palombino, Judicial Economy and Limitation of the Scope of the Decision inInternationalAdjudication,23LeidenJournalofInternationalLaw909(2010)

486. Palombino,TheOverlappingbetweenWarCrimesandCrimesAgainstHumanityinInternationalCriminalLaw,12TheItalianYearbookofInternationalLaw123(2002)

487. Paparinskis, Inherent Powers of ICSID Tribunals: Broad and Rightly So,ssrn.com/abstract=1876705(2012)

488. Park,NationalLawandCommercial Justice:SafeguardingProcedural IntegrityInInternationalArbitration,63Tul.L.Rev.6471988-1989

489. Park,Non-Signatoriesand InternationalContracts:AnArbitrator’sDilemma, inPermanent Court of Arbitration (ed.) Multiple Party in International Arbitration 1,OxfordUniversityPublishing(2009)

490. Park,The Lex Loci Arbitri and International Commercial Arbitration, 32 Int'l &Comp.L.Q.21(1983)

212

491. Parker, A BIT at a Time: The Proper Extension of the MFN Clause toDisputeSettlementProvisionsinBilateralInvestmentTreaties,2TheArbitrationBrief30(2012)

492. Pastore, “Giusto processo” e verità giudiziale,http://m.docente.unife.it/orsetta.giolo/Percorsi%20di%20Genere%20-%20Testi%20seminario%20I%20dicembre.doc(2012-2013)

493. Paul, Comity in International Law, 32 Harvard International Law Journal 1(1991)

494. Paul,The Transformation of International Comity, 71 Law and ContemporaryProblems19(2008)

495. Paulsson, Jurisdiction and Admissibility, Global Reflections on InternationalLaw,CommerceandDisputeResolution–LiberAmicoruminHonourofRobertBriner601(2005)

496. Pauwelyn, At the Edge of Chaos? Foreign Investment Law as A ComplexAdaptive System, How It Emerged And How It Can Be Reformed,http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2271869(2014)

497. Pauwelyn, Salles, Forum Shopping before International Tribunals: (Real)Concerns,(Im)PossibleSolutions,42CornellInternationalLawJournal77(2009)

498. Pellet,TheCaseLawof the ICJ in InvestentArbitration, 28 ICSIDReviewFILJ223(2013)

499. Perezcano,Has the Proliferation of BITS Gone Too Far? Is it Now Time for aMultilateralInvestmentTreaty?,5JournalofWorldInvestmentandTrade89(2004)

500. PerezManzano,Laprohibicionconstitucionaldeincurrirennebisinidem,tirantloblanch(2002)

501. Perry,Willtreatyarbitrationsurvive?,www.globalarbitrationreview.com(2014)502. Petrochilos, Extension of the Arbitration Clause to Non-Signatory States or

State Entities: Does it Raise a Difference?, in Schwartz, Hanotiau (eds.), MultipartyArbitration,DossiersoftheICCInstituteofWorldBusinessLaw11(2010)

503. Pharaon,The extent of arbitrators’ power to order class action, 31ArbitrationInternational589(2015)

504. PicòyJunoy,Labuonafedeprocessuale:unamanifestazionedell’autoritarismogiurisdizionale?,48Rivistadidirittoprocessuale171(2013)

505. Piergrossi, Tutela del terzo nell’arbitrato, in Studi in onore di Enrico TullioLiebman,Giuffré,Milano(1979)

506. Pierini, The Inflated Invocation of Inherent Jurisdiction and Powers byInternationaland InternationalizedCriminalCourtsandTribunals:BetweenGapFillingandtheErosionofCoreValues,UniversitàdiCatania–OnlineWorkingPaper2015/n.75(2015)

507. Pino,L’abusodeldirittotrateoriaedogmatica(precauzioniperl’uso),inManiaci(ed.).Eguaglianza,ragionevolezzaelogicagiuridica115,Giuffré,Milano(2006)

508. Pinos,ResJudicataRedux,26OsgoodeLawLawJournal713(1988)509. Pitkowitz, Joinder and Consolidation Under the Vienna Rules 2013, in Zeiler,

Welser et al. (eds.), Austrian Yearbook on International Arbitration Vol. 2015 301(2015)

510. Platte,WhenShouldanArbitrator JoinCases?,18Arbitration International67(2002)

511. Polasky,CollateralEstoppel-EffectsofPriorLitigation,39IowaLawReview217(1953-1954)

512. Pörnbacher,Dolgorukow,ReconcilingDueProcessadEfficiencyinInternationalArbitration–TheArbitrator’sTaskofAchievingtheOneWithoutSacrificingtheOther,61AnnalFLB-BelgradeLawReview50(2013)

513. Potestà,Sobat,FrivolousClaimsinInternationalAdjudication:AStudyofICSIDRule 41(5) and of Procedures of Other Courts and Tribunals to Dismiss ClaimsSummarily,3JournalofInternationalDisputeSettlement137(2012)

213

514. Price, Some observations on the role of the state in investor-state disputesettlement: Horizontal issues still over the horizon, in Cremades, Lew (eds.), ParallelStatesandArbitralProceduresinInternationalArbitration,ICCPublication73(2005)

515. Prosser,LawofTorts,3ded.,St.Paul,Minn.West(1964).516. ProtoPisani,Opposizionediterzoordinaria,Jovene,Napoli(1965)517. Pryles,Waincymer,MultipleClaims inArbitrationsBetween theSameParties,

http://www.arbitration-icca.org/media/0/12223886747020/multiple_claims_in_arbitrations_between_the_same_parties.pdf(2009)

518. Phull, U.S. Anti-suit Injunctions in Support of International Arbitration: FiveQuestionsAmericanCourtsAsk,Journalof InternationalArbitration,Vol.28No.1,21-50,2011

519. Polinari, Pluralità di parti e pluralità di convenzioni d’arbitrato, 16 Rivistadell’arbitrato537(2006)

520. Purcell,The Public Right to Precedent: A Theory and Rejection of Vacatur, 85CaliforniaLawReview867(1997)

521. Quadri,DirittoInternazionalePubblico–Vedizione,Liguori(1968)522. QuassDuarte,Anti-suit Injunctions in theContextof InternationalCommercial

Arbitration,48AntitrustandUnfairCompetitionLaw20(2010)523. RadicatidiBrozolo,Lasoluzionedellecontroversietrastatiestranierimediante

accordo internazionale: gli accordi tra Stati Uniti ed Iran, 76 Rivista di dirittointernazionale299(1982)

524. Radicati di Brozolo, Res Judicata and International Arbitral Awards,ssrn.com/abstract=1842685(2011)

525. Raphael,TheAnti-suitInjunction,OxfordUniversityPress(2008)526. Rau, “Consent” to Arbitral Jurisdiction: Disputes with Non-Signatories, in

Permanent Court of Arbitration (ed.) Multiple Party in International Arbitration 1,OxfordUniversityPublishing(2009)

527. Raz,AConceptofaLegalSystem,Oxford(1980).528. Razvi,MandatoryRules of Law in InternationalBusinessArbitration, 3 Lahore

JournalofEconomics35(1999)529. Reetz, Martinez-Fraga, Forum Non Conveniens and the Foreign Forum: A

DefensePerspective,www.transnational-dispute-settlement.com(2012)530. Reinhold,Good Faith in International Law, Bonn Research Papers on Public

InternationalLawNo.2/2013,ssrn.com/abstract=2269746(2013)531. Reinisch,The Issues Raised by Parallel Proceedings and Possible Solutions, in

Waibel,Kaushal(eds.)TheBacklashagainstInvestmentArbitration113,Kluwer(2010)532. Reinisch,TheProliferationofInternationalDisputeSettlementMechanisms:The

ThreatofFragmentationvs.thePromiseofaMoreEffectiveSystem?SomeReflectionsfrom the Perspective of Investment Arbitration, in Buffard, Hafner, Crawford (eds.),International Law Between Universalism and Fragmentation: Festschrift in Honour ofGerhardHafner107,Brill(2008)

533. Reinisch, The Use and Limits of Res Judicata and Lis Pendens as ProceduralTools to Avoid Conflicting Dispute Settlement Outcomes, 3 The Law and Practice ofInternationalCourtsandTribunals37(2004)

534. Reisman, Law, International Public Policy (so-called) and Arbitral Choice inInternational Commercial Arbitration,http://www.law.yale.edu/documents/pdf/Reisman.ICCA_Speech_for_Montreal.6.15.06.pdf(2006)

535. Reisman,TheBreakdownof theControlMechanism in ICSIDArbitration, 1989DukeLawJournal739(1990)

536. Reisman,TheRegimeforLacunaeintheICSIDChoiceofLawProvisionandtheQuestionofItsThreshold,15ICSIDReviewFILJ362(2000)

214

537. Reisman, Craig, Park, Paulsson, International Commercial Arbitration,FoundationPress(1997)

538. Ricci,Illodoritualedifronteaiterzi,23Rivistadidirittoprocessuale655(1989)539. Ricci, Ilnuovoarbitratosocietario,53Rivistatrimestraledidirittoeprocedura

civile517(2003)540. Rigo Sureda, Investment Treaty Arbitration Judging under Uncertainty,

CambridgeUniversityPress(2014)541. RigoSureda,Precedent in InvestmentTreatyArbitration, inBinder,Kriebaum,

Reinisch,Wittich (eds.), International Investment Law for the 21st Century: Essays inHonourofChristophSchreuer830,OxfordUniversityPress(2009)

542. Roberts, Clash of Paradigms: Actors and Analogies Shaping the InvestmentTreatySystem,107AmericanJournalofInternationalLaw45(2013)

543. Romanetti, Preventing the Multiple and Concurrent Arbitration Proceedings:WaiverClauses,StockholmInternationalArbitrationReviewVolume2009:2,75(2009)

544. Romano, The Proliferation of International Judicial Bodies: The Pieces of thePuzzle,31InternationalLawandPolitics709(1999)

545. Romano, The Shift from the Consensual to the Compulsory Paradigm inInternationalAdjudication:ElementsforaTheoryofConsent,39InternationalLawandPolitics791(2007)

546. RomanoS.,L’ordinamentogiuridico(1917)547. Rosenfeld, Arbitral Praeliminaria – Reflections on the Distinction between

AdmissibilityandJurisdictionafterBGv.Argentina,29LeidenJournalof InternationalLaw137(2016)

548. Rubino-Sammartano, International Arbitration Law and Practice, JurisPublishing(2014)

549. Ruffini,L’interventonelgiudizioarbitrale,5Rivistadell’arbitrato647(1995)550. Sabater, Towards Transparency in Arbitration (A Cautious Approach), 5

BerkeleyJournalInt’l.L.Publicist47(2010)551. Sacerdoti, Expert Opinion in Case T 8753-01-77, The Czech Republic v. CME

CzechRepublicBV,2TransnationalDisputeManagement(2005)552. Sacerdoti,Has the Proliferation of BITS Gone Too Far? Is it Now Time for a

MultilateralInvestmentTreaty?,5JournalofWorldInvestmentandTrade89(2004)553. Sacerdoti,IcontrattitraStatiestranierineldirittointernazionale,Giuffré(1972)554. Sacerdoti, The Proliferation of BITs: Conflicts of Treaties, Proceedings and

Awards, in Sauvant (ed.) Appeals Mechanism in International Investment Disputes127,Oxford(2008)

555. Sakai,LaBonneAdministrationdelaJusticeintheIncidentalProceedingsoftheInternationalCourtofJustice,55JapaneseYearbookofInternationalLaw110(2012)

556. Salacuse,Making transnational lawwork through regime-building: the case ofinternationalinvestmentlaw,inMakingTransnationalLawWorkintheGlobalEconomy–EssaysinHonourofDetlevVagts(Bekker,DolzerandWaibeleds.),Cambridge,406(2010)

557. Salerno,GiurisdizioneedefficaciadelledecisionistranierenelRegolamento(UE)n.1215/2012(rifusione),Kluwers–Cedam,Padova(2015)

558. Salerno,Rapporti fra procedimenti concernenti lemedesime istanza individualipresso diversi organismi internazionali di tutela dei diritti umani, 93 Rivista di dirittointernazionale363(1999)

559. Salles, Forum shopping in International Adjudication: The Role of PreliminaryObjections,141CambridgeUniversityPress(2014)

560. Sanders, Rethinking Arbitral Preclusion, 24 Law and Policy of InternationalBusiness101(1992)

561. Sandrock, Arbitration Agreements and Groups of Companies, 27 Int'l L. 941(1993)

215

562. Sauvant, The Rise of International Investment, Investment Agreements andInvestmentDisputes, inSauvant (ed.)AppealsMechanism in International InvestmentDisputes3,Oxford(2008)

563. Savarese, Il concorso di giurisdizioni nelle controversie tra stati e private inmateriad’investimenti:apropositodiduecontrastantisentenzedell’ICSID,17Dirittodelcommerciointernazionale955(2004)

564. Savarese, Investment Treaties and the Investor's Right to Arbitration betweenBroadeningandLimiting ICSID Jurisdiction, 7 JournalofWorld InvestmentandTrade407(2007)

565. Savarese, La nazionalità delle società commerciali e la funzione del controllo:alcune riflessioni inmargine alla decisione ICSID Tokios Tokeles v. Ukraine, 15 Rivistadell’arbitrato369(2005)

566. Savarese, La nozione di giurisdizione nel sistema ICSID, Editoriale scientifica(2012)

567. Savarese, Multiple Fora for the Same Disputed Facts. What CoordinationBetween International and National Jurisdictions in the Framework of ICSID?,www.federalismi.it(2009)

568. Scarselli, Sul cd. abuso del processo, 47 Rivista di diritto processuale 1450(2012)

569. Scherer,EffectsofForeignJudgmentsRelatingtoInternationalArbitralAwards/Is the ‘Judgment Route’ the Wrong Road?, 4 Journal of International DisputeSettlement587(2013)

570. Scherer, The Recognition of Transnational Substantive Rules By Courts inArbitral Matters, in IAI Series on International Arbitration n. 3, Towards a UniformInternationalArbitrationLaw91,JurisPublishing(2005)

571. Schill, Enabling Private Ordering: Function, Scope and Effect of UmbrellaClausesinInternationalInvestmentTreaties,18MinnesotaLawJournal1(2009)

572. Schill, Enhancing International Investment Law’s Legitimacy: Conceptual andMethodological Foundations of a New Public Law Approach, 52 Virginia Journal OfInternationalLaw57(2011)

573. Schill, System-building in Investment Treaty Arbitration and Lawmaking, 12GermanLawJournal1083(2011)

574. Schill, The Multilateralization of International Investment Law, Cambridge(2009)

575. Schill,TheMultilateralizationof International InvestmentLaw:TheEmergenceof a Multilateral System of Investment Protection on the Basis of Bilateral Treaties,InauguralConferenceoftheSocietyofInternationalEconomicLaw,Geneva,July15-17,2008,www.ssrn.com/link/SIEL-Inaugural-Conference.html(2008)

576. Schimek,Anti-suit andAnti-anti-suit Injunctions:AProposedTexasApproach,45BaylorLawReview499(1993)

577. Schneider,Multi-ForaDisputes,6ArbitrationInternational101(1990)578. Schneiderman, Judicial Politics and International Investment Arbitration:

Seeking an Explanation for Conflicting Outcomes,http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1965629(2010)

579. Schreuer, Concurrent Jurisdiction of National and International Tribunals, 13Hous.L.Rev.508(1975-1976)

580. Schreuer,FromICSIDAnnulmenttoAppealHalfWayDowntheSlipperySlope,10TheLawandPracticeofInternationalCourtsandTribunals211(2011)

581. Schreuer, Jurisdiction and Applicable Law in Investment Treaty Arbitration, 1McGillJournalofDisputeResolution1(2014)

582. Schreuer,NationalityPlanning,inRovine(ed.)TheFordhamPapers2012,17583. Schreuer, Revising the System of Review for Investment Awards,

http://www.univie.ac.at/intlaw/wordpress/pdf/99_rev_invest_awards.pdf(2009)

216

584. Schreuer, Shareholder Protection in International Investment Law,www.transnational-dispute-management.com(2005)

585. Schreuer, The Relevance of Public International Law in InternationalCommercial Arbitration: Investment Disputes,http://www.univie.ac.at/intlaw/pdf/csunpublpaper_1.pdf(2007)

586. Schreuer, Three Generations of ICSID Annulment Proceedings, in Gaillard,Banifatemi (eds.),Annulment of ICSIDAwards, IAI Series on InternationalArbitrationN°117,Juris(2004)

587. Schreuer,Travelling theBITRoute:OfWaiting Periods,Umbrella Clauses andForkintheRoad,5TheJournalofWorldInvestmentandTrade231(2004)

588. Schreuer (et al.), The ICSID Convention: A Commentary, Oxford UniversityPress(2009)

589. Schreuer, Reinisch, Legal opinion in the CME v. Czech Republic case,www.italaw.com(2002)

590. Schultz, Against Consistency in Investment Arbitration,papers.ssrn.com/sol3/papers.cfm?abstract_id=2318358(2013)

591. Schultz, Dupont, Investment Arbitration: Promoting the Rule of Law orOver-Empowering Investors? A Quantitative Empirical Study, ssrn.com/abstract=2399179(2014)

592. Schultz,TheConceptofLawinTransnationalArbitralLegalOrdersandsomeofitsConsequences,2JournalofInternationalDisputeSettlement59(2011)

593. Schwartz, Multi-Party Arbitration and the ICC, 10 Journal of InternationalArbitration5(1993)

594. Schwebel,PublicPolicyandArbitralProcedure, inSanders (ed.),ComparativeArbitration Practice and Public Policy in Arbitration, ICCA Congress Series Vol. 3 205(1987)

595. Scobbie, Res Judicata, Precedent and the International Court: A PreliminarySketch,20AustralianYearbookofInternationalLaw299(1999)

596. Scott,CollateralEstoppelbyJudgment,56HarvardLawReview1(1942)597. Semmel, Collateral Estoppel, Mutuality and Joinder of Parties, 68 Columbia

LawReview1457(1968)598. Sereni, Principi generali del diritto e processo internazionale, Giuffré, Milano

(1955)599. Seriki,Antisuitinjunctions,arbitrationandthenon-EUperspective:somerecent

developments,InternationalArbitrationLawReview19(2011)600. Shany,ConsolidationandTestsforApplication:IsInternationalLawRelevant?,

21ICSIDReview–FILJ135(2006)601. Shany, Contract Claims v. Treaty Claims/ Mapping Conflicts Between ICSID

Decisions onMulti-Sourced Investment Claims, 99 American Review of InternationalLaw835(2005)

602. Shany, Jurisdictional Competition between National and International Courts:Could International Jurisdiction-Regulating Rules apply?,http://papers.ssrn.com/sol3/papers.cfm?abstract_id=902928(2006)

603. Shany,Questions of Jurisdiction and Admissibility before International Courts,CambridgeUniversityPress(2015)

604. Shany,Regulating Jurisdictional Relations betweenNational and InternationalCourts,OxfordUniversityPublishing(2007)

605. Shany,Similarity intheEyeoftheBeholder:RevisitingtheApplicationofRulesGoverning Jurisdictional Conflicts in the Lauder/CME Cases,http://papers.ssrn.com/sol3/papers.cfm?abstract_id=999021(2007)

606. Shany, The Competing Jurisdictions of International Courts and Tribunals,OxfordUniversityPress(2003)

607. Shell,ResJudicataandCollateralEstoppelEffectsofCommercialArbitration,35

217

UCLAL.Rev.623(1987-1988)608. Sheppard,Arbitrator Independence in ICSID Arbitration, in Binder, Kriebaum,

Reinisch,Wittich (eds.) International InvestmentLawfor the21stCentury:Essays inHonourofChristophSchreuer131,Oxford(2009)

609. Sheppard, Res Judicataand estoppel, inCremades, Lew (eds.), Parallel StatesandArbitralProceduresinInternationalArbitration,ICCPublication219(2005)

610. Shihata, Parra, Applicable Substantive Law in Disputes between States andPrivate Foreign Parties: The Case of Arbitration under the ICSID Convention, ICCACongressSeriesNo.7294(1996)

611. Silberman, Some Judgments on Judgments: A View from America, 19 King’sLawJournal235(2008)

612. Sinai,ReconsideringResJudicata:AComparativePerspective,21DukeJournalofComparativeandInternationalLaw,353(2011)

613. Sinclair, The Substance of Nationality Requirements in Investment TreatyArbitration,20ICSIDRev.FILJ357(2005)

614. Smutny, Claims of Shareholders In International Investment Law, in Binder,Kriebaum,Reinisch,Wittich(eds.)InternationalInvestmentLawforthe21stCentury:EssaysinHonourofChristophSchreuer363,OxfordUniversityPress(2009)

615. Soderlund, Lis Pendens, Res Judicata and the Issue of Parallel JudicialProceedings,22Arb.Int.301(2005)

616. Sornarajah, A Coming Crisis: Expansionary Trends in Investment TreatyArbitration, in Sauvant (ed.)AppealsMechanism in International InvestmentDisputes39,Oxford(2008)

617. Sornarajah,TheInternationalLawonForeignInvestment,Cambridge(2010)618. Spagnolo, Iura Novit Curia and the CISG: Resolution of the Faux Procedural

BlackHole, inSchwenzer,Spagnolo (eds.),TowardsUniformity: the2ndAnnualMAASchlechtriemCISGConference181(2011)

619. Sperduti, Il principio della buona fede e l’ammissione di nuovi membri alleNazioniUnite,7Lacomunitàinternazionale42(1952)

620. Sperduti,Le eccezioni tratte dalla nozione di dominio riservato quali eccezionipreliminaridimerito,68Rivistadidirittointernazionale649(1974)

621. Spoorenberg,Vinuales,ConflictingDecisionsinInternationalArbitration,8Law&PracticeofInternationalCourts&Tribunals91(2009)

622. Spiermann, Individual Rights, State Interests and the Power to Waive ICSIDJurisdictionUnderBilateralInvestmentTreaties,20ArbitrationInternational179(2004)

623. Spurr,AnEconomicAnalysisofCollateralEstoppel,11 InternationalReviewofLawandEconomics47(1991)

624. Steingruber,AbaclatandOtherv.ArgentineRepublic–Consent inLarge-scaleArbitrationProceedings,27ICSIDReviewFILJ237(2012)

625. Stipanowich,Arbitrationand theMultipartyDispute: TheSearch forWorkableSolutions,72IowaLawReview473(1986-1987)

626. Stoehr,AquestionofSovereignty,Development,andNaturalResources:ANewStandard for Binding Third Party Nonsignatory Governments to Arbitration, 66WashingtonandLeeLawReview1409(2009)

627. Strong,ContractualWaiversof InvestmentArbitration:Wa(i)veof theFuture?,29ICSIDReviewFILJ1(2014)

628. Strong, Intervention and Joinder as of Right in International Arbitration: AnInfringementof IndividualContractRightsoraProperEquitableMeasure?, 31Vand. J.Transnat'lL.915(1998)

629. Strong,Mass Procedure in Abaclat v. Argentine Republic: Are They ConsistenwiththeInternationalInvestmentRegime?,3YBInternationalArbitration261(2013)

630. Strong, Third Party Intervention and Joinder of Right in InternationalArbitration: An Infringement of Individual Contract Rights or a Proper Equitable

218

Measure?,31VanderbiltJournalofTransnationalLaw915(1998)631. Strozzi, I “Principi” dell’ordinamento internazionale, 47 La comunità

internazionale162(1992)632. Swoboda, Consent is the Key to Compel: The Eight Circuit Properly Denies a

Motion toCompelaNon-Signatory toArbitrate.UnitedStatesCourtofAppeals,EightCircuit:BankofAmericav.UMBFinancialServices, 2 JournalofDisputeResolution1(2011)

633. Tamburini, Trattamento degli stranieri e buona fede nel diritto internazionalegenerale,CEDAM,Padova(1984)

634. Tams,AnAppealingOption? TheDebate About an ICSIDAppellate Structure,http://telc.jura.uni-halle.de/sites/default/files/altbestand/Heft57.pdf(2006)

635. Tan,Anti-SuitInjunctionsandtheVexingProblemofComity,45VirginiaJournalofInternationalLaw283(2005)

636. Taruffo,AspettiFondamentalidelProcessoCivilediCivilLawediCommonLaw,36RevistadaFaculdadedeDireitodaUFPR27(2001)

637. Taruffo,Precedenteegiurisprudenza,Editorialescientifica(2007)638. Tarzia, L’intervento di terzi nell’arbitrato societario, 44 Rivista di diritto

processuale349(2004)639. Tawil,ApplicableLaw,UNCTADCourseonDisputeSettlement in International

Trade, Investment and Intellectual Property,http://unctad.org/fr/Docs/edmmisc232add5_en.pdf(2003)

640. Ten Cate,Multi-Parti and Multi-Contract Arbitrations: Procedural MechanismandInterpretationofArbitrationAgreementsUnderU.S.Law,15TheAmericanReviewofInternationalArbitration133(2004)

641. TheMutualityRequirement inRes Judicata andEstoppel byRecord,Note in 2WashingtonandLeeLawReview233(1941)

642. Tirado,Page,Meagher,CorruptionInvestigationsbyGovernmentalAuthoritiesandInvestmentArbitration:AnUneasyRelationship,29ICSIDReviewFILJ493(2014)

643. Tizi, Litisconsorzio successive e imparzialità del tribunale arbitrale, 17 Rivistadell’arbitrato485(2008)

644. Tonini, La tutela internazionale dei diritti contrattuali degli investitori esteri,DoctoralThesis–UniversityofPadua,http://paduaresearch.cab.unipd.it/3532/(2011)

645. Tonolo, Pluralità di giudicati ed opposizione all’esecuzione delle sentenzestraniere,43Rivistadidirittoprocessuale,1277(2008)

646. Topcan,AbuseofRighttoAccesstoICSIDArbitration,29ICSIDReviewFILJ627(2014)

647. Townsend, Extending an Arbitration Clause to a Non-Signatory Claimant orNon-Signatory Defendant: Does it Make a Difference?, in Schwartz, Hanotiau (eds.),MultipartyArbitration,DossiersoftheICCInstituteofWorldBusinessLaw111(2010)

648. Townsend, Non-signatories in International Arbitration: An AmericanPerspective, invandenBerg (ed.) InternationalArbitration2006:Back toBasics?,13ICCACongressSeries359(2007)

649. Treves,ConflictsBetweentheInternationalTribunalfortheLawoftheSeaandTheInternationalCourtofJustice,31NewYorkUniversityJournalofInternationalLawandPolitics809(1999)

650. Trocker, I limiti soggettivi del giudicato tra tecniche di tutela sostanziale egaranzie di difesa processuale (profili dell’esperienza giuridica tedesca), 23 Rivista didirittoprocessuale35(1989)

651. Tyler,Kovarsky,Stewart,BeyondConsent:ApplyingAlterEgoandArbitrationDoctrinestoBindSovereignParents, inPermanentCourtofArbitration(ed.)MultiplePartyinInternationalArbitration1,OxfordUniversityPublishing(2009)

652. Vadi, Towards Arbitral Path Coherence & Judicial Borrowing/ PersuasivePrecedent in Investment Arbitration, www.transnational-dispute-management.com

219

(2008)653. Vadi, Through the Looking-Glass: International Investment Law through the

Lens of a Property Theory, 8Manchester Journal of International Economic Law 22(2011)

654. Valenti,Glistandardditrattamentonell’interpretazionedeitrattatiinmateriadiinvestimentistranieri,Giappichelli(2009)

655. Valenti, Il trattamento “conforme al diritto internazionale” degli investimentistranierinelle convenzioni internazionali, 17DirittodelCommercio Internazionale973(2004)

656. Van Aaken, Fragmentation of International Law: The Case of InternationalInvestmentProtection,17FinnishYearbookofInternationalLaw91(2006)

657. VanBockel,TheNeBisinidemprincipleinEUlaw,Kluwer(2009)658. VanHarten,InvestmentTreatyArbitrationandPublicLaw,Oxford(2007).659. Van Harten, The Public-Private Distinction in the International Arbitration of

IndividualClaimsAgainsttheState,56ICLQ371(2007)660. VanHarten,Malysheuski,Whohasbenefitedfinanciallyfrominvestmenttreaty

arbitration?An evaluation of the size and wealth of claimants, 12 Osgoode LegalStudiesResearchPaperNo.141(2016)

661. Vandevelde,AguasdelTunari,S.A.v.RepublicofBolivia,101Am.J.Int'lL.179(2007)

662. Vandevelde,BilateralInvestmentTreaties,Oxford(2010)663. VanHoutte,McAsey,AbaclatandOthersv.ArgentineRepublic–ICSID,theBIT

andMassClaims,27ICSIDReviewFILJ231(2012)664. Vecchione,L’arbitratonelsistemadelprocessocivile,Giuffrè,Milano(1971)665. Vervaele,NeBisInIdem:TowardsaTransnationalConstitutionalPrincipleinthe

EU?,9UtrechtLawReview211(2013)666. Vestal,ExtentofClaimPreclusion,54IowaLawRev.1(1968)667. Vestal, Preclusion/Res Judicata Variables: Nature of the Controversy, 1965

WashingtonUniversityLawQuarterly158(1965)668. Vestal, Preclusion/Res Judicata Variables: Parties, 50 Iowa Law Review 27

(1964-1965)669. Vestal,Rationale of Preclusion, 9 St. Louis University Law Journal 29 (1964-

1965)670. Vestal,ResJudicata/Preclusion:Expansion,47SouthernCaliforniaLawReview

356(1974)671. Vestal,TheConstitutionandPreclusion/ResJudicata,62MichiganLawReview

33(1963)672. Viegas de Freitas Monteiro, Jura Novit Curia in International Commercial

Arbitration, Doctoral Thesis – University of Helsinki,https://helda.helsinki.fi/bitstream/handle/10138/40746/Pro%20gradu.pdf?sequence=5(2013)

673. Viola,Zaccaria,Dirittoeinterpretazione,Laterza,Bari(2009)674. Virally, Review Essay: Good Faith in Public International Law, 76 American

JournalofInternationalLaw130(1983)675. Virzo, Il regolamento delle controversie nel diritto del mare: rapporti tra

procedimenti,CEDAM(2008)676. Volpino,L’oggettodelgiudicatonell’esperienzaamericana,CEDAM(2007)677. von Jhering,Die ReflexWirkungen oder die Ruckwirkung rechtlicher Tatsachen

aufdrittePersonen,inAnnaliperladogmatica245(1871)678. Voon, Mitchell, Munro, Legal Responses to Corporate Manoeuvring in

International InvestmentArbitration,5Journalof InternationalDisputeSettlement41(2014)

679. Voser,Multi-partyDisputesandJoinderofThirdParties, invandenBerg(ed.),

220

50 Years of the New York Convention: ICCA International Arbitration Conference, 14ICCACongressSeries343(2009)

680. Voser,SwissPerspective:“Thetraditionalapproachwithatwistregardingabuseofrights”or“Consenttheoryplus”,ConferenceMaterialsoftheSchoolofInternationalArbitration 30thAnniversaryConference: “The Evolution and Future of InternationalArbitration:TheNext30Years”,Unpublished(2015)

681. Voser, Meier, The Arbitrator – Joinder of Third Parties or the Need to(Sometimes) Be Inefficient, in Zeiler, Welser et al. (eds.), Austrian Yearbook onInternationalArbitrationVol.2008115(2008)

682. Waggoner, Fifty Years of Bernhard v. Bank of America Is Enough: CollateralEstoppel Should Require Mutuality But Res Judicata Should Not, 12 The Review ofLitigation391(1993)

683. Wagner, Jurisdiction by Estoppel in the International Court of Justice, 74CaliforniaLawReview1777(1986)

684. Waibel, Investment Arbitration: Jurisdiction and Admissibility, Legal StudiesResearchPaperSeriesUniversityofCambridge,PaperNo.9/2014(2014)

685. Waibel, Kaushal, Chung and Balchin, The Backlash against InvestmentArbitration:PerceptionsandReality,ssrn.com/abstract=1733346(2010)

686. Waincymer,ProcedureandEvidenceinInternationalArbitration,Kluwer(2012)687. Walters,FittingaSquarePegintoaRoundHole:DoResJudicataChallengesin

InternationalArbitrationConstituteJurisdictionalorAdmissibilityProblems?,29JournalofInternationalArbitration651(2012)

688. Wang Dong, Binding Force and Enforcement, UNCTAD Course on DisputeSettlement in International Trade, Investment and Intellectual Property,http://unctad.org/en/Pages/DITC/DisputeSettlement/Project-on-Dispute-Settlement-in-International-Trade,-Investment-and-Intellectual-Property.aspx(2003)

689. WangDong,Post-AwardRemediesandProcedures,UNCTADCourseonDisputeSettlement in International Trade, Investment and Intellectual Property,http://unctad.org/en/Pages/DITC/DisputeSettlement/Project-on-Dispute-Settlement-in-International-Trade,-Investment-and-Intellectual-Property.aspx(2003)

690. Watt, Radicati di Brozolo,Party Autonomy andMandatory Rules in a GlobalWorld,6InternationalLawFORUMdudroitinternational90(2004)

691. Watson,JosephStoryandtheComityofErrors,TheUniversityofGeorgiaPress(1992)

692. Watson,DuplicativeLitigation: IssueEstoppel,AbuseofProcessandtheDeathofMutuality,69CanadianBarReview623(1990)

693. Wehland, The Coordination of Multiple Proceedings in Investment TreatyArbitration,OxfordUniversityPress(2013)

694. Weidemaier,TowardaTheoryofPrecedentinArbitration,51WilliamandMaryLawReview1895(2010)

695. Weininger,AproposofConocoPhillipsv.Venezuela:RevisionofEarlierDecisionsin Fragmented Proceedings – AMatter of Principle?,www.kluwerarbitrationblog.com(2014)

696. Weininger, JurisdictionChallenges inBITArbitrations –DoYouReadaBITByReading a BIT or By Reading Into a BIT?, in Mistelis, Lew, Pervasive Problems inInternationalArbitration235,Kluwer(2006)

697. Weiss, InherentPowersofNationaland InternationalCourts:ThePracticeofthe Iran-US Claims Tribunal, in Binder, Kriebaum, Reinisch, Wittich (eds.),International Investment Law for the 21st Century: Essays in Honour of ChristophSchreuer185(2009)

698. Weissenfels, Umbrella Clauses,https://intlaw.univie.ac.at/fileadmin/user_upload/int_beziehungen/Internetpubl/weissenfels.pdf(2007)

221

699. Welser, Efficiency – Today’s Challenge in Arbitration Proceedings, in Zeiler,Welseretal.(eds.),AustrianYearbookofInternationalLaw149(2014)

700. Wendlandt,SGSv.PhilippinesandtheRoleofICSIDTribunalsinInvestor-StateContractDisputes,43TexasInternationalLawJournal532(2008)

701. Westerlind, Fox, The Preclusive Effect of Arbitration Awards, 21 Mealey’sLitigationReport1(2010)

702. Whitesell, Multiparty Arbitration: The ICC International Court of ArbitrationPerspective, in Permanent Court of Arbitration (ed.) Multiple Party in InternationalArbitration203,OxfordUniversityPublishing(2009)

703. Wilkie,UNCITRALUnveils New Transparency Rules – Blazing a Trail TowardsTransparencyinInvestor-StateArbitration?,www.kluwerarbitrationblog.com(2013)

704. Williams,JurisdictionandAdmissibility, inMuchlinski,Ortino,Schreuer (eds.),The Oxford Handbook of International Investment Law 868, Cambridge UniversityPress(2008)

705. Wilske, Shore, Ahrens, The “Group of Companies Doctrine” – Where Is ItHeading?,17TheAmericanReviewofInternationalArbitration73(2006)

706. Winstanley,MultipleParties,MultipleProblems:AViewfromtheLondonCourtof InternationalArbitration, inPermanentCourtofArbitration (ed.)MultipleParty inInternationalArbitration213,OxfordUniversityPublishing(2009)

707. Wirtz,DueProcessofArbitration,inTheArbitratorandtheParties,ProceedingsoftheEleventhAnnualMeetingoftheNationalAcademyofArbitrators1,Washington(1958)

708. Wisner,Gallus,NationalityRequirementsinInvestor-StateArbitration,5JournalofWorldInvestmentandTrade927(2004)

709. Wolfrum, Intervention in the Proceedings before the International Court ofJusticeandtheInternationalTribunalfortheLawoftheSea,inGötz,Selmer,Wolfrum(eds.),LiberamicorumGüntherJaenicke–Zum.85Geburstag427,Springer(1998)

710. Wong,CourtorArbitrator-WhoDecidesWhetherResJudicataBarsSubsequentArbitrationundertheFederalArbitrationAct,46SantaClaraLawReview49(2005)

711. Wong, Umbrella Clauses in Bilateral Investment Treaties: Of Breaches ofContract,TreatyViolations,AndDevelopedCountriesinForeignInvestmentDisputes,14Geo.MasonLawReview135(2006)

712. Woolhouse, Group of Companies Doctrine and English Arbitration Law, 20ArbitrationInternational435(2004)

713. Yang, Resolving Potential Jurisdiction Conflicts in ACFTA: The Principle of ResJudicata,3TsinghuaChinaLawReview335(2011)

714. Yannaca-Small, Consolidation of Claims: A Promising Avenue for InvestmentArbitration?,OECDInternationalInvestmentPerspectives225(2006)

715. Yannaca-Small, Improvingthesystemof investor-Statedisputesettlement:AnOverview, OECD Working Papers on International Investment 2006/1,www.oecd.org/investment

716. Yannaca-Small, Interpretation of the Umbrella Clause in InvestmentAgreements, OECD Working Papers on International Investment, 2006/03,http://dx.doi.org/10.1787/415453814578(2006)

717. Yannaca-Small, Parallel Proceedings, in Muchlinski, Ortino, Schreuer (eds.),TheOxfordHandbook of International Investment Law 1010,OxfordUniversityPress(2008)

718. Youssef,TheLimitsofConsent:TheRightorObligation toArbitrationofNon-SignatoriesinGroupofCompanies,inSchwartz,Hanotiau(eds.),MultipartyArbitration,DossiersoftheICCInstituteofWorldBusinessLaw,71(2010)

719. Youssef,UniversalArbitrationBetweenFreedomandConstraint:TheChallengesof Jurisdiction inMultiparty,Multi-ContractArbitration, 16 ICCACongressSeries 103(2012)

222

720. Zarra, Il nuovo regolamento Bruxelles I-bis ed il problema dell’esclusionedell’arbitrato,www.giustiziacivile.com,approfondimentodel5dicembre2014(2014)

721. Zarra, Il ricorsoalleanti-suit injunctionsper risolvere i conflitti internazionalidigiurisdizione ed il ruolo dell’international comity, 50 Rivista di diritto internazionaleprivatoeprocessuale561(2014)

722. Zarra, L’esecuzione dei lodi arbitrali annullati presso lo Stato della sede e laConvenzionediNewYork:versoun’uniformitàdi vedute?,24Rivistadell’arbitrato574(2015)

723. Zarra,TheArbitrabilityofDisputesArisingfromIntra-EUBITs,25TheAmericanReviewofInternationalArbitration573(2014)

724. Zeiler,Jurisdiction,Competence,andAdmissibilityofClaimsinICSIDArbitrationProceedings, in Binder, Kriebaum, Reinisch, Wittich (eds.), International InvestmentLawforthe21stCentury:EssaysinHonourofChristophSchreuer76,Oxford(2009)

725. Zekos,PrecedentandStareDecisisbyArbitrationsandCourts inGlobalization,10TheJournalofWorldInvestmentandTrade475(2009)

726. Zhang, Proper Interpretation of Corporate Nationality Under InternationalInvestmentLawtoPreventTreatyShopping,6Contemp.AsiaArb.J.49(2013)

727. Zhenjie, Forum Non Conveniens: An Unjustifed Doctrine, 48 NetherlandsInternationalLawReview143(2009)

728. Zhilsov, Mandatory and Public Policy Rules in International CommercialArbitration,42NetherlandsInternationalLawReview81(1995)

729. Ziccardi Capaldo, Il principio di buona fede nell’esecuzione dei trattati. Il casoBattisti:unesempioemblematicodimalafides, inVassallidiDachenhausen(ed.),AttidelconvegnoinmemoriadiLuigiSico509,EditorialeScientifica,Napoli(2011)

730. Zivkovic,Contract,TreatiesandUmbrellaClauses:SomeJurisdictionalIssuesinInvestmentTreatyArbitration,http://ssrn.com/abstract=2119861(2011)

731. Zoller,Labonnefoiendroitinternationalpublic,Paris(1977)732. Zoppo,LasoluzionedellecontroversiecommercialitraStatitramultilateralismo

eregionalismo,JoveneEditoreNapoli(2013)733. ZucconiGalliFonseca,Laconvenzionearbitralerispettoaiterzi,Giuffré,Milano

(2004)