• Journal of Arbitration Studies
• /
• v.28 no.4
• /
• pp.173-191
• /
• 2018

MFN provisions in investment agreements have been a tool for equitable treatment between foreign investors with different nationalities. This non discriminatory principle has been pursued by the host states for further investment promotion. However, it may be abused to bring the situation of so called "ISDS forum shopping" which might harm the stability and predictability of investment agreements by unexpectedly extending the scope of obligations. While some investment arbitral tribunals have interpreted the scope of MFN provision very broadly to allow the ISDS forum shopping, both procedural and substantive provisions have been invoked. To prevent any chaos of unclear boundary of MFN provision, some explicit MFN restrictions which would limit the scope of MFN provision are needed. Indeed, some investment agreements have included these MFN restrictions. Specifically, MFN restrictions deal with both procedural or substantive provisions to prevent ISDS forum shopping. According to the lessons from the recent examples of MFN restrictions, there must be a careful consideration on the benefits and costs of having a certain type of MFN restriction as the parties can be the host state and the home state of their investors at the same time.

• Journal of Arbitration Studies
• /
• v.32 no.3
• /
• pp.3-27
• /
• 2022

Climate change is a man-made disaster that has become a major global concern today. With increasingly visible symptoms of climate change in recent years, it has become evident that climate action can no longer be dismissed as a mere matter of choice, but as a matter of survival for the human being. To address the impending climate change crisis in a collaborative and sustainable manner, the international community has been taking various measures including Kyoto protocol and the Paris Agreement. With respect to the private investor's project investment in line with international agreements on climate change, recently we have seen multiple legal judgments which clearly indicate the subject of judicial responsibility for investment in climate change related projects. However, in order to hold judicial responsibility occurring during the implementation of climate change related projects, a causal relationship between the responsible entities and clear responsibility must be demonstrated, and applicable institutional arrangements need to be arranged. It may be the right time for global community to consider shifting not only to human ethical obligations but also legal obligations. In this regard, concerned governments should consider legislating arbitration laws, regulations, and institutional arrangements in more specific and applicable manner.

• THE INTERNATIONAL COMMERCE & LAW REVIEW
• /
• v.39
• /
• pp.179-220
• /
• 2008

The notion of the 'court' is most unique to ICC arbitration. This paper focuses on what the court is and how it works and what the role and the duties of the Court under the ICC arbitration imply for the KCAB International Arbitration Rules. The Court is an administrative body that administers arbitrations taking place under the ICC Rules of Arbitration. The Court consists of 126 members from 88 countries around the world. Court members participate in decision-making process by way of attending the committee sessions and plenary sessions. At the Court's committee sessions, the Court fixes advance on costs; reviews the prima facie existence of arbitration agreements; fixes the place and language of arbitration, and the number of arbitrator(s); confirms and approves arbitrators; scrutinizes draft awards, determines the costs of arbitration; decides on extensions related to Terms of Reference, draft awards and correction and interpretation of the awards. At the Court's plenary sessions, the Court performs only two responsibilities: the challenge or replacement of arbitrators or the scrutiny of draft awards. The Court is required to scrutinize draft awards involving states or state entities, drafts with huge amounts in dispute or complex technical or legal questions, and as well as draft awards to which a dissenting opinion has been attached. Turning to the KCAB International Arbitration Rules, Article 1(3) provides that the KCAB shall establish an International Arbitration Committee. Further, it is provided that the KCAB shall consult with the said Committee with respect to challenge and replacement/removal of arbitrators pursuant to Article 1(3). The notion and role of the International Arbitration Committee was originally adapted from the Court to ICC arbitration, but its role was quite reduced in the process of enactment of its Rules. Accordingly, I examined the detailed roles of the Court to ICC arbitration in this paper and hereby suggest that the KCAB International Arbitration Rules shall be amended in the following ways: The Secretariat of the KCAB shall: fix advance on costs at the first stage and the costs of arbitration at the final stage of the proceedings; determine the number of arbitrators; review the prima facie of existence of arbitration agreement; confirm arbitrators; decide extensions related to time table, draft awards and correction and interpretation of the awards. I, also, suggest that the arbitral tribunals shall fix the place of arbitration and the language of arbitration and make a final decision on the validity of arbitration agreement. With regard to the International Arbitration Committee, it is desirable for its Rules to empower the Committee to recommend any prospective arbitrator and to review and decide challenge and replacement/removal of arbitrators.

• THE INTERNATIONAL COMMERCE & LAW REVIEW
• /
• v.49
• /
• pp.325-358
• /
• 2011

The purpose of this study aims to analyse the implications of volume contract clause with Rotterdam Rules. The Hague-Visby Rules have been in force this jurisdiction for over 30 years. In those three decades they have performed valiant service, both for the development of maritime law in this country and for the countless parties from around the world who have chosen courts and arbitral tribunals in London for the resolution of disputes arising under bills of lading or under charterparties incorporating the Hague-Visby Rules. While the Hague-Visby Rules apply only to bills of lading or any other similar documents of title and hence all other contracts of carriage are not subject to the current regime, this is not the case for the Rotterdam Rules which, broadly speaking, apply to contracts of carriage whether or not a shipping document or electronic transport record is issued. To preserve freedom of contract where necessary, however, a number of significant concessions were made and Article 80 represents one of the most controversial: that of volume contracts. However, the provision lends itself to abuse under each one of the elements as there is no minimum quantity, period of time or frequency and the minimum number of shipments is clearly just two. This means that important contracts of affreighment concluded pursuant to, for example, oil supply agreements have the same right to be excluded from the scope of application of the Rotterdam Rules. The fact that a volume contract may incorporate by reference the carrier's public schedule of services and the transport document or other similar documents as terms of the contract would make a carefully drafted booking note for consecutive shipments a potential volume contract as well.

• THE INTERNATIONAL COMMERCE & LAW REVIEW
• /
• v.66
• /
• pp.149-170
• /
• 2015

State's compensation obligation accompanied in case of indirect expropriation of foreign investor's investment asset has been established definite principle under international investment law. But the concrete and unified application criterion regarding valuation methods for measuring compensation have not been established yet. The World Bank investment guideline is adopting the Hull's Formula, which is understood as the full compensation standard with prompt adequate effective compensation and Fair Market Value method. It is a general principle that compensation should be equal to the fair market value of investment asset just before indirect expropriation date. However, there is a problem of the valuation method of fair market value of investment asset. In general, discounted cash flow, liquidation value, replacement value, book value, etc. can be the applicable standards. Arbitral tribunals determine compensation by adopting proper valuation method on a case-by-case basis according to the discretion based on the arbitration parties' experts' review on the presented opinion and by considering fact relevance of the issued dispute. This compensation includes also interest, recently it tends to award according to compound interest rather than simple interest. Beginning of the period to generate interest is the next day of the indirect expropriation occurrence date. And it should be considered that interest until the payment of compensation is also included. In addition, it should be considered that mental damages is available only when there's a basis to prove this or special case. Therefore, this study suggests to review of precedents related to indirect expropriation and concretely specify compensation valuation standard and method of indirect expropriation on investment agreements through enough consultation beforehand.

• Journal of Korea Trade
• /
• v.25 no.7
• /
• pp.108-121
• /
• 2021

Purpose - This paper studies whether the CISG is applicable to the arbitration agreement when the validity of the arbitration agreement becomes an issue. To make the study clear, it limits the cases assuming that the governing law of the main contract is the CISG and the arbitration agreement is inserted in the main contract as a clause. Also, this paper discusses only substantive and formal validity of the arbitration agreement because the CISG does not cover the questions of the parties' capacity and arbitrability of the dispute. Design/methodology - This paper is based on scholarly writings and cases focusing on the principle of party autonomy, formation of contract and the doctrine of separability to discuss characteristic of arbitration agreement. In analyzing the cases, it concentrates on the facts and reasonings that show how the relative regulations and rules are interpreted and applied. Findings - The findings of this paper are; regarding substantive validity of arbitration agreement, the courts and arbitral tribunals consider general principles of law for the contract and the governing law for the main contract. In relation to formal validity of arbitration agreement, the law at the seat of arbitration or the law of the enforcing country are considered as the governing law in preference to the CISG because of the recognition and enforcement issues. Originality/value - This paper attempts to find the correlation between the CISG and the arbitration agreement. It studies scholars' writing and cases which have meaningful implication on this issue. By doing so, it can provide contracting parties and practitioners with some practical guidelines about the governing law for the arbitration agreement. Furthermore, it can help them to reduce unpredictability that they may confront regarding this issue in the future.

• Journal of Arbitration Studies
• /
• v.32 no.2
• /
• pp.85-114
• /
• 2022

When human rights disputes are related to the cross-border investments treaties, the investment arbitral tribunals are confronted with the question of how to adjudicate connected human rights violations. The traditional structure restricts arbitration proceedings to the parties named within an investment treaty, i.e., Investor-Claimant and State-Respondent. If human rights issues occur, States must act as proxies for citizens with human rights claims. This effectively excludes individuals or groups with human rights concerns and contradicts the premise of international human rights law that seeks to empower human rights-holders to pursue claims directly and on an international stage. The methods for intorducing human rights issues in the context of investment arbitration proceedings are suggested as follows: First, human rights arguments can be introduced into ISDS by the usual initiator of investment disputes: the investor as the complainant. Especially, if the jurisdictional and applicable law clauses of the respective international investment agreements are sufficiently broad to include human rights violations, adjudicating a pure human rights claim could be possible. Second, the host state may rely on human rights argumentation as a respondent of an investor claim. Human rights have played a role as a justification for state measures undertaken to comply with human rights laws. Third, third party interventions by NGOs and civil society groups as amici curiae may act as advocates for affected populations or communities in response to the reluctance of governments to introduce their own human rights duties into the investment dispute. Finally, arbitrators have also referred to human rights ex officio, i.e., without having a dispute party referring to the specific argument. This was mainly the case in the context of determining the scope of property rights and the existence of an expropriation. As all U.N. member states have human rights obligations, international investment laws must be presumed to be in conformity with the relevant human rights obligations.

• Korea Trade Review
• /
• v.41 no.5
• /
• pp.305-323
• /
• 2016

The scope of umbrella clause is very important because it is possible to extend or reduce the range of protection of the investment. Umbrella clause stipulated in the majority of BIT is often controversial, since there is no established criteria for the scope. So, this study considered ICSID arbitration cases related to the scope of umbrella clause. There are two different approaches for the scope of umbrella clause by arbitral tribunals. First, all of the disputes on the investment contract elevated to the disputes on the BIT. And umbrella clause can be applied that the host state entered into investment contract not only as a sovereign but also as a merchant. Second, all of the claims on the investment contract don't elevate to the claims on the BIT. Umbrella clause can be applied only if the host state violates the protected investment contractual rights and obligation under the BIT. And umbrella clause can be applied that the host state entered into investment contract as a sovereign but not as a merchant. Therefore, this study suggests to concretely specify the scope of umbrella clause under the BIT. And it is necessary to improve predictability by establishing continual database of the scope of umbrella clause and to prepare for investment disputes related to the scope of umbrella clause.

• Journal of Arbitration Studies
• /
• v.14 no.1
• /
• pp.273-314
• /
• 2004

There is a belief in the construction industry that the traditional court system may not be an ideal forum to effectively and efficiently resolve construction disputes due to the protracted proceedings and the three tier appeal system resulting in a long delay in the final and conclusive settlement of the dispute, relatively high costs involved, the lack of requisite knowledge and experience in the relevant industry, etc. Hence, they assert that certain alternative dispute resolution ('ADR') methods, such as mediation, conciliation, arbitration or a new system for dispute settlement in the form of any combination thereof should be developed and employed for construction disputes so as to resolve them more promptly and efficiently to the satisfaction of all the disputants concerned. This paper discusses certain merits of such assertions and the need for additional considerations for effective resolution of the construction disputes in light of the complexity of the case, importance of expert witnesses, parties' relationship and non-level playing field of the construction industry and so on. At the same time, however, given the inherent nature of disputes rendering the parties involved in an adversarial position, it would rather be difficult, if not practically impossible, to satisfy all the parties concerned in the dispute. Accordingly, in this study, it is also purported to address the demerits of such assertions by studying the situation from a more balanced perspective, in particular, in relation to the operation of such ADRs. In fact, most of such ADRs as stipulated by special acts, such as the Construction Industry Basic Act of Korea, in the form of mediation or conciliation, have failed to get support from the industry, and as a result, such ADRs are seldom used in practice. Tn contrast, the court system has been greatly improved by implementing a new concentrated review system and establishing several tribunals designed to specialize in the review and resolution of specific types of disputes, including the construction disputes. These improvements of the court system have been warmly received by the industry. Arbitration is another forum for settlement of construction disputes, which has grown and is expected to grow as the most effective ADR with the support from the construction industry. In this regard, the Korean Commercial Arbitration Board ('KCAB') has established a set of internal rules end procedures in operation to efficiently handle construction disputes. Considering the foregoing, this paper addresses the most important elements of the arbitration, i.e., arbitration agreement and arbitral award, primarily focusing on the domestic arbitrations before the KCAB. However, since this parer is prepared for presentation at the construction disputes seminar for the public audience, it is not intended for academic purposes, nor does it delve into any specific acadcmic issues. Likewise, although this paper addresses certain controversial issues by way of introduction, it mainly purports to facilitate the understanding of the general public, including the prospective arbitrators on the KCAB roster without the relevant legal education and background, concerning the importance of the integrity of the arbitration agreement and the arbitral award. In sum, what is purported in this study is simply to note that there are still many outstanding issues with mediation, conciliation and arbitration, as a matter of system, institutional operation or otherwise, for further study and consideration so as to enhance them as effective means for settlement of construction disputes, in replacement of or in conjunction with the court proceeding. For this purpose, it is essential for all the relevant parties, including lawyers, engineers, owners, contractors and social activists aiming to protect consumers' and subcontractors' interests, to conduct joint efforts to study the complicated nature of construction works and to develop effective means for examination and handling of the disputes of a technical nature, including the accumulation of the relevant industrial data. Based on the foregoing, the parties may be in a better position to select the appropriate dispute resolution mechanism, a court proceeding or in its stead, an effective ADR, considering the relevant factors of the subject construction works or the contract structure, such as the bargaining position of the parties, their financial status, confidentiality requirements, technical or commercial complexity of the case at hand, urgency for settlements, etc.

• Journal of Arbitration Studies
• /
• v.10 no.1
• /
• pp.3-25
• /
• 2000

At its thirty-second session in 1999, the UNCITRAL had before it the requested note entitled "Possible future work in the area of international commercial arbitration." After concluding the discussion on its future work in the area of international commercial arbitration, it was agreed that the priority items for the working group should be conciliation, requirement of written form for the arbitration and enforceability of interim measures of protection. the Commission entrusted the work to the Working Group on Arbitration which held its thirty-second session at Vienna from 20 to 31 March 2000. The Working Group discussed agenda item 3 on the basis of the report of Secretary General entitled "Possible uniform rules on certain issues concerning settlement of commercial disputes : conciliation, interim measures of protection, written form for arbitration agreement." At its thirty-three session in 2000, the UNCITRAL had before it the report of Secretary General on agenda item 3 discussed by the Working Group. The Working Group discussed the issues relating to certain aspects of conciliation proceedings ; (1) Admissibility of certain evidence in subsequent judicial or arbitral proceedings ; (2) Role of conciliatior in arbitration or court proceedings ; (3) Enforceability of settlement agreements reached in conciliation proceedings ; (4) Other possible items for harmonized treatment : a) Admissibility or desirability of conciliation by arbitrators b) Effect of an agreement to conciliate on judicial or arbitral proceedings c) Effect of conciliation on the running of limitation period d) Communication between the conciliator and parties ; disclosure of information e) Role of conciliator. It was generally considered that decisions as to the form of the text to be prepared should be made at a later stage when the substance of prepared solutions would become clearer. However, it was noted that model legislative provisions seemed to be appropriate form for a number of matters proposed to be discussed in the area conciliation. There was general support in the Working Group for the proposition to perpare a legislative regime governing the enforcement of interim measures of protection ordered by arbitral tribunals. It was generally considered that legislative regime should apply to enforcement of interim measures issued in arbitration taking place in State where enforcement was sought as well as outside that State. It was generally observed that there was a need for provisions which conformed to current practice in international trade with regard to requirements of written form for arbitration agreement. The view was adopted by the Working Group that the objective of ensuring a uniform interpretation of the form requirement that responded to the needs of international trade could be achieved by : preparing a model legislative provision clarifying, for avoidance of doubt, the scope of article 7(2) of the UNCITRAL Model Law on International Commercial Arbitration : and adopting a declaration, resolution or statement addressing the interpretation of the New York Convention that would reflect a broad understanding of the form requirement. There was general agreement in the Working Group that, in order to promote the use of electronic commerce for international trade and leave the parties free to agree to the use of arbitration in the electronic commerce sphere, article II(2) of the New York Convention should be interpreted to cover the use of electronic means of communication as defined un article 2 of the Model Law on Electronic Commerce and that it required no amendment to do that. The UNCITRAL may wish to consider to the desirability of preparing uniform provisions on any of those issues concerning conciliation and arbitration proceedings, possibly indicating whether future work should be towards a legislative text or non-legislative text.