UNCTAD publishes new statistics on investment treaty arbitration, by José Ángel Rueda

UNCTAD has published a new edition of its statistics on investment treaty arbitration. Despite its title, “Recent Developments in Investor-State Dispute Settlement (ISDS)”,[1] it just refers to investment treaty arbitration, as stated above, because an inquiry on investment disputes arising out solely of a contract between a foreign investor and a State entity is almost impossible to achieve (arbitration courts apply strict confidentiality on these matters).  

Anyway, the statistics are very relevant: in 2012 62 new cases were initiated under international investment agreements (IIAs), the biggest figure ever for a single year. Annex 1[2] contains the names of the parties in 56 cases (mostly ICSID) and assures that a further 6 disputes are pending at the SCC in Stockholm and the CRCICA in Cairo.

On the question of awards, Annex 3 provides an executive summary on the decisions rendered during 2012. It is remarkable that just 12 of the decisions published found State’s liability for breaches of IIAs including BITs, NAFTA and DR-CAFTA,[3] while a number of cases were dismissed on jurisdiction and/or the merits.[4] Furthermore, compensation to investors was awarded only 9 times,[5] spanning between EUR 350,000 plus compound interest in Swisslion v. F. Y. R. of Macedonia and USD 1.77 billion plus pre- and post-award compound interest in Occidental v. Ecuador.[6] Despite dissenting views, we conclude that it is not easy to obtain a finding of liability against a State under an investment treaty claim and, much less, an award on damages.

The debate is open.

[2] At pp. 27-28.

[3] At pp. 32-33.

[4] See pp. 32-33.

[5] At p. 34.

[6] See p. 18.