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Hicee v. Slovakia

Type of decisionPartial Award
Date of decision23 May 2011
Tribunal
Franklin Berman (President)
Peter Tomka
Charles N. Brower (dissenting)
Legal instrumentBIT between Czech Republic and Netherlands (1991)
Related decision(s)Supplementary and final award, 17 October 2011
Further information

Statements from this decision

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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
Estoppel
If a state party were to adopt a position on an interpretation issue contrary to its formal position at the time of ratification, a tribunal would not permit this in accordance with the principle of nemo audietur venire contra factum proprium
Law of Treaties
Rules of Interpretation
Interpretation Rules of the Vienna Convention on the Law of Treaties (VCLT) as Reflecting Customary International Law
The provisions on treaty interpretation do not introduce a rigid or hierarchical set of rules
IITs must be interpreted using the rules of interpretation laid down in the VCLT
Object and Purpose as a Rule of Interpretation
The object and purpose of IITs is to encourage investments on a mutual and reciprocal basis, while balancing the interests of investors and host states; taken for itself, this object and purpose does not say anything about where the balance has been drawn in a particular IIT
Further Problems
Article 32 VCLT confers a discretion upon the tribunal whether to resort to supplementary means of interpretation
Article 32 VCLT enumerates examples only; the category of admissible supplementary means is not a closed one
Article 32 VCLT is not only applicable in cases of ambiguity or obscurity, but also where an interpretation result is manifestly absurd, or to confirm an interpretation result; however, in all alternatives Article 31 VCLT remains the starting point
Explanatory notes are not a material covered by Article 31 VCLT
While explanatory notes are not part of the preparatory work, they can still be taken into account in an interpretation according to Article 32 VCLT
Article 32 lit. b) VCLT requires that an interpretation according to Article 31 VCLT leads to an unreasonable result; it does not apply if Article 31 VCLT allows for more than one interpretation with the interpreter undecided which one is more appropriate
A tribunal is bound by the policy aims agreed upon by the state parties; its task is one of interpretation, not criticism
Whether an ambiguity regarding the ordinary meaning of IIT terms exists does not depend on the pleadings of the parties
An IIT can have only one authentic meaning; the meaning does not vary depending on the parties to a particular dispute
Protection of Investors under IITs
Applicability of IITs
Ratione Materiae – Definition of Investment
The Concept of "Investment"
Shares
In general international law the corporate form is legally distinct from the shareholders; the admissibility of shareholder claims depends on the provisions of the IIT in question
Further Problems
The phrase "invested either directly or through an investor of a third state" may have different meanings - a directional one referring to the investment's origin, and a relational one referring to its connection to the investor
'Structured investments' are commonplace; their purpose is to secure advantages from incorporation or operation in a particular jurisdiction
Expropriation and Standards of Protection
Most-Favoured-Nation Treatment (MFN)
General Remarks
Each MFN clause has to be interpreted according to its own terms
In the IIT between The Netherlands and Slovakia, the MFN clause does not broaden the definition of the investors or the investments
Investment Treaty Arbitration
General Remarks
A tribunal is bound by the policy aims agreed upon by the state parties; its task is one of interpretation, not criticism
Vienna Convention on the Law of Treaties
Article 31 - General rule of interpretation
General Remarks
Explanatory notes are not a material covered by Article 31 VCLT
A tribunal is bound by the policy aims agreed upon by the state parties; its task is one of interpretation, not criticism
The provisions on treaty interpretation do not introduce a rigid or hierarchical set of rules
Whether an ambiguity regarding the ordinary meaning of IIT terms exists does not depend on the pleadings of the parties
An IIT can have only one authentic meaning; the meaning does not vary depending on the parties to a particular dispute
IITs must be interpreted using the rules of interpretation laid down in the VCLT
Article 32 - Supplementary means of interpretation
Negotiation records are a well recognized category of interpretative material in international law
Whether an interpretation is "manifestly" unreasonable within the meaning of Article 32 VCLT depends on the state parties' policy aims as expressed in the IIT
Ex post facto opinions about what is presumed to have animated the negotiation of an IIT are in principle of doubtful value
It is of considerable significance if the respondent invokes an interpretation of the IIT by the other state party to the IIT
A tribunal has to interpret the IIT, not the interpretative materials
Article 32 VCLT confers a discretion upon the tribunal whether to resort to supplementary means of interpretation
Article 32 VCLT enumerates examples only; the category of admissible supplementary means is not a closed one
Article 32 VCLT is not only applicable in cases of ambiguity or obscurity, but also where an interpretation result is manifestly absurd, or to confirm an interpretation result; however, in all alternatives Article 31 VCLT remains the starting point
While explanatory notes are not part of the preparatory work, they can still be taken into account in an interpretation according to Article 32 VCLT
Article 32 lit. b) VCLT requires that an interpretation according to Article 31 VCLT leads to an unreasonable result; it does not apply if Article 31 VCLT allows for more than one interpretation with the interpreter undecided which one is more appropriate

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