Resolution of Contemporary Investment Disputes: Conciliating Private Rights and Public Interests in Internationalized Commercial Relations
01 / 2011 - 01 / 2014
In 2001 Argentina faced a financial crisis and adopted sweeping emergency measures that negatively affected foreign investors. Based on direct rights granted under investment treaties, investors have brought some 44 claims against Argentina before international arbitral tribunals to seek reparation for financial losses resulting from the breach of investment contracts with Argentina. This number of claims is in line with a trend: in December 2009 an unprecedented number of approximately 150 investment cases were pending before international arbitral tribunals, compared to a total number of 100 completed cases between the registration of claims in 1966 and 2002. Traditionally investor-state conflicts were solved by applying either national law in domestic courts or international law when the home state had internationalised the claim of its national trough the exercise of diplomatic protection. However, through globalization, and the explosion in cross-border investments, a hybrid system has emerged, adapted to the multi-layered character of investor-state conflicts. Contemporary investment disputes directly opposing private rights of foreign investors to states' public policies are now directly settled between states and investors, by simultaneously applying commercial and public international law. This system, and the increase in the number of investment conflicts have however revealed tensions between commercial law and public international law principles, which this research aims to unravel, by focusing on two developments: - Substantive hybridization: the application of a substantive legal system which simultaneously applies principles of commercial law and public international law - Procedural hybridization: the direct access of investors to dispute resolution mechanisms based on private commercial arbitration to solve disputes with a public and international character Unravelling and understanding these tensions will allow us to consider a new conceptualization to reconcile private rights and public interests, and to appraise the extent to which investment arbitration has affected the position of the state.