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A tribunal does not need to research or apply national law if it has neither been argued nor been identified as essential to the decision
A (partial) award is binding on the tribunal and the parties
Res judicata requires identical parties, the same subject matter and the same cause of action
The standard of compensation according to the fair market value of the asset on expropriation is relevant for the calculation of damages for the breach of other standards of protection
Compound interest does not need to be awarded if the purpose of compensation does not require it
As long as the treaty does not require an exhaustion of local remedies, jurisdiction of a tribunal can be established even if the state has not treated the investment finally through judicial process
A party is capable of waiving lis pendens and res judicata defences
- Investment Treaty Arbitration > Admissibility > Lis Pendens / Parallel Proceedings
- Investment Treaty Arbitration > Admissibility > Res Judicata / Ne Bis In Idem
A claimant has a duty to mitigate losses
A "company group" theory is not generally accepted in international arbitration; thus, a shareholder and a company cannot be considered an identical party, e.g. within the meaning of the res judicata defence
In case restitution in kind is not possible, the respondent must pay a sum corresponding to the fair market value of the investment before the breach of treaty occurred
The basis of the interest rate is not determined by the currency of the claim, but by the provisions of the applicable law
After an unlawful expropriation, interest has to be awarded from the date the principle sum should have been paid; the date may depend on the rules of national law
Within a choice of law clause, it is important to distinguish whether a tribunal shall apply certain sources of law, or take them into account
It is a general principle of international arbitration that a tribunal is not allowed to decide ex aequo et bono without authorization by the parties
- International Investment Treaties (IITs) > International Law Rules Applicable to IITs > Relationship of IITs to Other Sources of International Law > Relationship of an IIT to General Principles of International Law > Further Problems
- International Investment Treaties (IITs) > Protection of Investors under IITs > Applicable Law / Choice of Law Clauses
- UNCITRAL Arbitration Rules 1976 > Article 33
If a choice of law clause requires a decision "on the basis of the law", the decision must be based on well-recognized international law precedents
- International Investment Treaties (IITs) > International Law Rules Applicable to IITs > Relationship of IITs to Other Sources of International Law > System of Precedents
- International Investment Treaties (IITs) > Protection of Investors under IITs > Applicable Law / Choice of Law Clauses
International Law Rules Applicable to IITs
Relationship of IITs to Other Sources of International Law
System of Precedents
If a choice of law clause requires a decision "on the basis of the law", the decision must be based on well-recognized international law precedents
Relationship of an IIT to General Principles of International Law
Further Problems
It is a general principle of international arbitration that a tribunal is not allowed to decide ex aequo et bono without authorization by the parties
Law of State Responsibility
Restitution and Compensation
In case restitution in kind is not possible, the respondent must pay a sum corresponding to the fair market value of the investment before the breach of treaty occurred
Protection of Investors under IITs
Dispute Settlement Clauses
Exhaustion of Local Remedies Clauses
As long as the treaty does not require an exhaustion of local remedies, jurisdiction of a tribunal can be established even if the state has not treated the investment finally through judicial process
Applicable Law / Choice of Law Clauses
A tribunal does not need to research or apply national law if it has neither been argued nor been identified as essential to the decision
Within a choice of law clause, it is important to distinguish whether a tribunal shall apply certain sources of law, or take them into account
It is a general principle of international arbitration that a tribunal is not allowed to decide ex aequo et bono without authorization by the parties
If a choice of law clause requires a decision "on the basis of the law", the decision must be based on well-recognized international law precedents
Admissibility
Lis Pendens / Parallel Proceedings
A party is capable of waiving lis pendens and res judicata defences
Res Judicata / Ne Bis In Idem
Res judicata requires identical parties, the same subject matter and the same cause of action
A party is capable of waiving lis pendens and res judicata defences
A "company group" theory is not generally accepted in international arbitration; thus, a shareholder and a company cannot be considered an identical party, e.g. within the meaning of the res judicata defence
Damages and Interest
Interest
Interest Absent Explicit Rules
Compound interest does not need to be awarded if the purpose of compensation does not require it
The basis of the interest rate is not determined by the currency of the claim, but by the provisions of the applicable law
Date From Which Interest Should be Granted
After an unlawful expropriation, interest has to be awarded from the date the principle sum should have been paid; the date may depend on the rules of national law
Relationship of Damages and Compensation for Expropriation
The standard of compensation according to the fair market value of the asset on expropriation is relevant for the calculation of damages for the breach of other standards of protection
Further Problems
A claimant has a duty to mitigate losses
Article 32
A (partial) award is binding on the tribunal and the parties
Article 33
It is a general principle of international arbitration that a tribunal is not allowed to decide ex aequo et bono without authorization by the parties