Domestic courts in investor-state arbitration : partners, suspects, competitors

Abstract

This is a study about the roles that investment tribunals

accord to domestic courts in the process of arbitrating disputes between

States and foreign investors. It investigates the approaches taken and

attitudes held towards domestic courts in the jurisprudence of arbitral tribunals – not only with a view to making sense of this ever-growing jurisprudence, but with the intent to developing a coherent theory on how domestic courts are perceived by international adjudicators. The argument advanced in this study is that these roles can essentially be conceptualized in three ways. First, as partners, in the sense that domestic courts can assist arbitral tribunals in the determination of certain points of fact, as well as of points of applicable domestic law. Second, as suspects, in the sense that their conduct may itself be injurious to the investor and its investment, and as such become the object of scrutiny by arbitral tribunals. And third, as competitors, in the sense that domestic courts, by providing an avenue for redressing injuries suffered by the investor at the hands of a host State’s authorities, can compete with arbitral tribunals as potential fora for resolving investment disputes.