German Model Bilateral Investment Treaties (2005 and 2008) - World Arbitration Reporter (WAR) - 2nd Edition
Dr. Sabine Konrad, a Partner in the Paris office of K&L Gates LLP since 2009, specializes in International Dispute Resolution and in particular in International Arbitration and Public International Law, regularly advising investors and governments in matters of investment protection. She also sits as arbitrator. In 2007 the Government of the Federal Republic of Germany appointed her as a member of the Panel of Arbitrators of the World Bank’s International Centre for Settlement of Investment Disputes (ICSID). She was also closely involved in setting up the Frankfurt International Arbitration Center, which serves as a cooperation facility of ICSID for investment treaty arbitrations in Germany. Dr. Konrad publishes extensively on investment arbitration. She is a co-founder of the Frankfurt Investment Arbitration Moot Court and designs the case studies for this international moot court competition. Dr. Konrad is a German Rechtsanwältin and was admitted to the Frankfurt Bar in 2002. She also is a Fellow at the Chartered Institute of Arbitrators.
Originally from World Arbitration Reporter (WAR) - 2nd Edition
I. INTRODUCTION – THE CONTEXT OF THE MODEL TREATIES
A. Historical Background
The German contribution to the European and global drive towards an investment treaty culture in the 1950s and 1960s is crystallized in the person of Hermann Josef Abs, proponent of a global “Magna Charta for the Protection of Foreign Property” and co-author of the Abs-Shawcross Draft. Although the preference of Abs and other German decision-makers was undoubtedly for a multilateral regime, even with supranational elements, that was clearly likely to take time and the state was content to start with a bilateral program. The state’s early treaties inspired others, notably in Europe, and the complex patchwork of bilateral investment treaties (BITs) was begun.
The first investment treaty ever was concluded between Germany and Pakistan on 25 November 1959 and is still in force. Ever since, Germany has pursued a dynamic BIT program aimed at promoting export and foreign investment by Germans.
For much of this period, the dominant direction of investment flows was from German investors into other contracting parties’ territories. Nowadays, at least in relation to some trading partners, the position is more balanced. A prime example is China, which has become a capital exporting state investing in Germany. This change in the underlying investment reality is reflected in the text of the 2003 treaty which provides for full-scale investor-state arbitration.
GERMAN MODEL BILATERAL INVESTMENT TREATIES (2005 AND 2008) - TABLE OF CONTENTS from World Arbitration Reporter (WAR) - 2nd Edition
GERMAN MODEL BILATERAL INVESTMENT TREATIES (2005 AND 2008)
I. INTRODUCTION – THE CONTEXT OF THE MODEL TREATIES
A. Historical Background
B. General Principles of German Investment Treaty Policy
C. Position of Investment Treaties and Arbitral Awards in the Domestic Legal System
II. COMMENTARY ON THE 2005 AND 2008 MODEL TREATIES
A. Introduction
B. Scope
1. Material scope
2. Personal scope
a) Natural persons
b) Juridical persons and other entities
i. Under the 2005 Model Treaty
ii. Situation under the 2008 Model Treaty
iii. Consequences of Investors
3. Temporal scope
C. Substantive Rights
1. Promotion and admission of investments
2. Fair and equitable treatment. Full protection and security, and prohibition on arbitrary and discriminatory measures
3. National treatment and MFN treatment
4. Observance of obligations (umbrella clause”)
5. Free transfer of payment
6. Compensation for expropriation and losses of war
D. Preservation of Rights and Overriding Provisions of National or International Law
E. Settlement of Disputes
F. Miscellaneous
1. Subrogation or assignment of rights
2. Application in case of conflict
3. Registration clause
III. REVIEW OF ARBITRAL DECISIONS UNDER GERMAN BITS
A. Review of Reported Decisions
1. Franz Sedelmayer v. The Russian Federation: ad hoc arbitration (Arbitration Institute of the Stockholm Chamber of Commerce), Award, 7 July 1998
2. Siemens AG. v. Argentine Republic: Decision on Jurisdiction, ICSID Case No. ARB/02/8, August 2004 (“Siemens I”). Siemens AG v. Argentine Republic, Award, ICSID Case No. ARB/02/8, 6 February 2007 (“Siemens II”) (subject to pending annulment and revision proceedings)
3. Fraport AG Frankfurt Airport Services Worldwide v. Republic of the Philippines, ICSID Case No. ARB/03/25, Award, 16 August 2007 (subject to pending annulment proceedings)
4. Wintershall Aktiengesellshaft v. Argentine Republic, Award ICSID Case No. ARB/04/14, 8 December 2008
B. Other Decisions and Pending Matters
1. Walter Bau AG i.l. v. Republic of Thailand (decision on jurisdiction, award on the merits, both unpublished), an ad hoc arbitration under UNICITRAL rules concerning the Don Muang Tollway project in Bangkok
2. Other pending matters
IV. APPENDIX
A. Text of the Model BITs
1. 2005 Model BIT
2. 2008 Model BIT
B. Bibliography