chapter  2
28 Pages

Investment arbitration in Asia: five perspectives on law and practice

ByLUKE NOTTAGE AND J . ROMESH WEERAMANTRY

International commercial arbit ra tion (ICA) has become much more im port­ ant for Asia since the 1990s. New arbit ra tion centres in the region, often with direct or indirect fin an cial sup port from the gov ern ment, attract growing caseloads (Nottage and Garnett 2010a). This de velopment is sup­ ported by widespread accession to the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards (NYC: 330 UNTS 3),2 and the highest adoption rate for the UNCITRAL Model Law on Inter­ national Commercial Arbitration (Greenberg, Kee and Weeramantry 2010: 36). Courts throughout Asia, despite some signi fic ant exceptions,3 have gen erally come to uphold ICA’s core prin ciples – respecting arbit ral proceedings and the awards they generate. Prominent arbit ral institutions based in the traditional Western ‘core’ of the arbit ra tion world have also recently estab lished a more permanent pres­ ence in the Asian region. Leading Euro pean and United States law firms, as well as Asian ‘home grown’ firms, have begun providing expert advice for ICA proceedings in the region. Some Asian practitioners are also now very active as arbitrators in ICA proceedings, both regionally and world­ wide (Pryles and Moser 2007: 12-13). Some of these arbitrators, law firms and institutions are also starting to show inter est in the emerging field of investor­ state arbit ra tion (ISA). Yet the incidence of ISA claims against Asian states, compared with states from other regions, remains rel at ively low (see Figure 2.3), espe cially con sidering the high numbers of investment treat ies concluded by Asian states that entitle investors to file ISA claims against them. Possible explanations for this low level of ISA filings will be one of the key issues examined in this chapter. This is rather puzz ling, first because most Asian coun tries have now become par ties to the 1965 Convention on the Settlement of Investment Disputes between States and Nationals of Other States (ICSID Convention: 575 UNTS 159).4 Article 25 requires a host state to provide ‘consent’ to allow an investor from a home state to bring a claim directly against the host

state under the ICSID Convention regime. This consent is now usually found in arbit ra tion pro vi sions contained in investment treat ies concluded among ICSID Convention state parties.5