Containing the Scope of the Umbrella Case - Chapter 2 - Investment Treaty Arbitration and International Law - Volume 1
About the Editor:
TODD WEILER is an investment treaty counsel and arbitrator and noted expert on NAFTA Chapter 11. He is the co-founder of Investmentclaims.com and the publisher of NAFTAClaims.com.
PIETER H.F. BEKKER is a Partner in the International Dispute Resolution Group at McDermott Will & Emery LLP in New York. He is an Adjunct Professor of International Arbitration at Fordham University School of Law in New York and a member of the Executive Council of the American Society of International Law. Prior to entering private practice, Dr. Bekker worked in the Registry of the International Court of Justice.
ANDREA K. BJORKLUND is a Professor at the University of California, Davis, School of Law who specializes in international economic law, international arbitration and litigation, international trade, and conflict of laws. Before starting at Davis, she spent two years as a Bigelow Fellow and Lecturer in Law at the University of Chicago Law School and from 1999-2001, Ms. Bjorklund was an attorney-adviser in the Office of the Legal Adviser at the U.S. Department of State, where she defended the United States in investor-State arbitrations brought under the NAFTA.
GABRIEL BOTTINI serves as Counsel in the Office of the Attorney General for the Government of Argentina. He has represented his country in a large number of bilateral investment treaty cases and has written widely on the subject.
CHARLES N. BROWER is a member of 20 Essex Street Chambers. During his career in international arbitration Judge Brower has served as counsel, arbitrator and expert witness in numerous ad hoc and institutional arbitration proceedings. A well known author and long-standing member of the American Society of International Law, Charles N. Brower served as Judge of the Iran-United States Claims Tribunal and as a member of the United Nations Compensation Commission.
CHARLES H. BROWER II is Jessie D. Puckett, Jr., Lecturer and Croft Associate Professor of International Law at the University of Mississippi Faculty of Law. A noted author on international investment and dispute settlement, Professor Brower currently serves on the Executive Council of the American Society of International Law and the Executive Committee of the Institute for Transnational Arbitration (ITA).
MARINN CARLSON Partner, Sidley Austin LLP, Washington, DC
DAVID D. CARON is the C. William Maxeiner Distinguished Professor of Law at the University of California at Berkeley. Professor Caron is a member of the U.S. Department of State Advisory Committee on Public International Law and serves as a Vice President of the American Society of International Law, and Chair of the Institute of Transnational Arbitration of the Center for American and International Law. Professor Caron served as Commissioner with the Precedent Panel (E2) of the United Nations Compensation Commission in Geneva, resolving claims arising out of the 1990 Gulf War, and acted as Counsel for Ethiopia before the Ethiopian - Eritrean Claims Commission in 2005. He currently serves as a Member of two NAFTA tribunals.
JACK J. COE, Jr. is a Professor of Law at Pepperdine University School of Law, specializing in private international law. Professor Coe is an elected member of the American Law Institute, admitted to practice in California and Washington, and a member of the Chartered Institute of Arbitrators, London. He is a co-chair of the International Commercial Dispute Resolution Committee of the ABA International Law Section, and chairs the Academic Council of the Institute for Transnational Arbitration. Professor Coe has served as both counsel and expert in investor-state arbitrations.
GRAHAM COOP has served as General Counsel at the Energy Charter Secretariat since 2004. Prior to joining the Secretariat, Mr. Coop was partner with Denton Wilde Sapte's Energy and Infrastructure Department in London for two years and spent 10 years at the Paris office of Freshfields Bruckhaus Deringer, where he served as Head of the firm's Energy and Natural Resources Group.
ALEX DE GRAMONT Partner, Crowell & Moring LLP, Washington, DC
GONZALO FLORES is Senior Counsel at the ICSID. In this capacity, Mr. Flores has served as tribunal secretary in a large number of proceedings instituted under the ICSID Convention, the ICSID Additional Facility Rules and the UNCITRAL Arbitration Rules.
DAVID R. HAIGH is Senior Partner at burnet, Duckworth & Palmer LLP, Calgary.
LAURA HALONEN is an Attorney in the Paris office of Freshfields Bruckhaus Deringer. She has been involved in a large number of international commercial arbitrations and both ad hoc and ICSID proceedings under bilateral investment treaties.
WALID BEN HAMIDA is Professor of International Law at the Universite d'Evry (Sciences Po), Paris. Dr. Hamida has previously taught at the University of Paris II, the University of Paris Dauphine, the University of Bucharest (college Franco-Roumain) and the University of Paris V.
KAJ HOBÃR is a Partner of Mannheimer Swartling in the Stockholm office, and Professor of East European Commercial Law at Uppsala University, Uppsala.
STEPHEN JAGUSCH is a Partner in the London office of Allen & Overy LLP. Co-chair of the firm's international arbitration practice, Mr. Jagusch specialises in international commercial and investment treaty arbitration, having acted as adviser and advocate in dozens of ad hoc and institutional international arbitrations, both in favour of, and against, sovereign states.
DEVASHISH KRISHAN is an Attorney at Baker Botts, London. Dev Krishan has wide experience before a variety of international tribunals. He has previously been an assistant legal counsel at the Permanent Court of Arbitration in The Hague and has clerked for the Chief Justice of India.
IAN LAIRD is Counsel with the international arbitration practice of Crowell Morning LLP in Washington D.C. He is the co-founder and Editor-in-Chief of Investmentclaims.com. Mr. Laird was involved as counsel in some of the earliest NAFTA arbitrations and is currently involved in a number of investment treaty arbitrations.
CAROLYN B. LAMM is a Partner in the Washington, D.C. office of White & Case, LLP. A member of the ICSID panel of arbitrators, Ms. Lamm has represented a large number of claimants and respondents in investor-state arbitrations.
ROBERTO J. AGUIRRE LUZI is a Special Legal Consultant in the International Arbitration Practice Group of King & Spalding's Houston office. Mr. Aguirre Luzi's practice focuses on international arbitration with an emphasis on international public law. He has been involved in numerous ICSID and UNCITRAL arbitrations, particularly involving the natural resources and utilities sectors.
ANDREA J. MENAKER is Chief of the NAFTA Arbitration Division in the Office of the Legal Adviser for the U.S. Department of State. She also participates in the negotiation of dispute resolution and investment provisions in U.S. free trade agreements and bilateral investment treaties. Prior to working for the Department of State, Professor Menaker was a law clerk for the U.S. District Court for the Southern District of New York and worked for several years as an associate for Shearman & Sterling.
CRAIG MILES is a Partner in King & Spalding's Houston office and has served as first chair on numerous ICSID and ad hoc arbitrations.
UCHE ONWUAMAEGBU is Senior Counsel at ICSID. In addition to management of arbitral proceedings, he actively participates in ICSID's knowledge dissemination program and coordinates various institutional initiatives at the Centre including amendments to the Rules and Regulations of the Centre. Prior to joining ICSID in 2001, Mr. Onwuamaegbu was a Senior Legal Officer at the United Nations Compensation Commission. Mr. Onwuamaegbu is a Barrister of the Supreme Court of Nigeria and a Solicitor of the Supreme Court of England and Wales. He presently serves as a co-Chair of the International Courts Committee of the American Bar Association's International Law Section.
WILLILAM W. PARK is Professor of Law at Boston University. He is General Editor of ArbitrationInternational, Vice President of the London Court of International Arbitration, and a member of the NAFTA Financial Services Roster. Park served as Arbitrator on the International Commission on Holocaust Era Insurance Claims and the Claims Resolution Tribunal for Dormant Accounts in Switzerland.
NOAH RUBINS is Counsel in the International Dispute Resolution and public international law practice groups of Freshfields Bruckhaus Deringer, Paris, France. He has served as counsel in numerous investor-state arbitrations.
BORZU SABAHI is a Consultant working in the International Arbitration Group of Fulbright & Jaworski LLP in Washington D.C. He is an Adjunct Professor and SJD Candidate at the Georgetown University Law Center.
CHRISTOPH SCHREUER is a Professor of International Law at the University of Vienna. He spent most of his academic career at the Department of International Law of the University of Salzburg and has also served as the Edward B. Burling Professor of International Law and Organization at the Paul H. Nitze School of Advanced International Studies (SAIS) of the Johns Hopkins University in Washington, DC. He has published numerous articles and several books in the field of international law, including a 1500-page monograph called: The ICSID Convention: A Commentary.
ANTHONY C. SINCLAIR is an Attorney in the International Arbitration Group of Allen & Overy LLP, London. He is admitted as a Solicitor in England and Wales and a Barrister and Solicitor of the High Court of New Zealand. He has been counsel in numerous investment treaty arbitrations under ICSID and UNCITRAL arbitration rules, ICSID annulment proceedings, and international commercial arbitration proceedings generally. Anthony Sinclair is also the author of numerous articles and chapters on international investment law and arbitration.
MARGRETE STEVENS is a Consultant with King & Spalding LLP in Washington D.C. She was formerly ICSID's Acting Lead Counsel, a position she had held for two years. The co-author of one of the first monographs on the protection of foreign investment in international law, Ms. Stevens has personal experience with dozens of investment treaty arbitrations held under the ICSID Rules.
SYLVIE TABET is a Senior Counsel & Deputy Director in the Trade Law Bureau of the Department of Foreign Affairs & International Trade, for the Government of Canada. She has represented her country in a number of arbitrations under the NAFTA and has provided advice to her Government on the negotiation of its foreign investment protection agreements.
THOMAS WÃLDE was the Jean-Monnet Chair on European Economic and Energy Law at the University of Dundee's Centre for Energy, Petroleum & Mineral Law & Policy and is a member of Essex Court Chambers in London. He serves as Editor-in-Chief of the OGEL Global Energy Law Web Portal, Transnational-dispute-management.com and the OGEMID electronic discussion group.
MICHAEL WOODS is a Partner at Heenan Blaikie, Ottawa.
Originally from Investment Treaty Arbitration and International Law - Volume 1
One of the main areas of uncertainty in the interpretation of investment treaties is the scope of the so-called “umbrella clause.” This is a provision commonly incorporated in investment treaties by which the contracting states undertake to “observe” or “guarantee” any “undertakings” or “obligations” they have “entered into with regard to” the “investments” of nationals of the other contracting state.1 The jurisprudence of arbitral tribunals has revealed a tension between, on the one hand, a very broad interpretation of the “umbrella clause”,2 and, on the other, an overly narrow one that leaves the clause virtually without meaning.3 Presumably with time a middle ground limiting the scope of the clause to reasonable, predictable and coherent dimensions will emerge.
This paper presents a suggestion for such dimensions. The first section below will set out the reasons for limiting the scope of the umbrella clause arising from the intention of the contracting parties, as revealed by the historic origins of the clause, as well as from practical consequences of a failure to limit its scope. The subsequent two sections will outline possible limits for the clause. In short, umbrella clauses should be considered to apply only to contractual (or "quasi-contractual") obligations made by a state in its capacity as sovereign, and they should bind the state only vis-a-vis the party with whom the obligation is entered into.
Praise for Investment Treaty Arbitration and International Law - Volume 1
“Todd Grierson Weiler, the guiding hand and organizer of the conference in Washington DC in 2007 which led to this book, has taken the traditional conference materials book and adopted the formula most brilliantly for the distinctive discipline that is investment treaty arbitration and international law. …. The papers are reproduced in full in the book and are products of much scholarship and hard work. These are not conference papers which one occasionally sees – namely shorter presentation pieces designed for ready consumption by an audience – rather they are highly thoughtful and challenging works which command careful reading. … While the papers throughout do not always reflect the personal views of the authors – they were assigned a thesis to advance/defend, much in the same way that one argues for a client’s case regardless of personally-held views – the approach is a particularly important one and marks out the book’s contribution to international law. …This book represents and contains an important and contemporary contest of ideas and thoughts given by those who are in practice in this field.
This is not a book for the novitiate, nor is it a ready guide-book to investment treaty arbitration; this is a thought-provoking and substantial presentation of ideas in five particular topics and rightly deserves its place in the library of all who practice in this area. It is not a book for one to settle down and digest in one easy bite – this book requires and commands time to properly consider. It is all the better for that attribute. Further volumes are awaited with much anticipation.”
Klaus Reichert, Brick Court Chambers is a Barrister and Chartered Arbitrator. He is Co-Chair of the IBA Litigation Committee, is a member of the LCIA European Users' Council, the ICC Commission on Arbitration, IBA delegate to the Hague Conference on Private International Law
"This is a very wide-ranging work that brings together several generations of legal specialists from very different cultures of law; it includes highly original, even brilliant contributions."
Droit Et Pratique Des Investissements Internationaux - (International Investments Law And Practice)