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Alter Book Symposium: The New Terrain of International Law

by Karen J. Alter

[Karen J Alter is Professor of Political Science and Law at Northwestern University and co-direcor at iCourts Center of Excellence at the Copenhagen University Faculty of Law.]

The New Terrain of International law: Courts, Politics, Rights uses the universe of operational permanent international courts (ICs), those with appointed judges that stand ready to receive cases, as a laboratory to explore the changing reach and influence of international courts in contemporary politics. In 1989 when the Cold War ended, there were six operational ICs. Today there are more than two-dozen that have collectively issued over thirty-seven thousand binding legal rulings. The New Terrain of International Law shows how today’s international courts differ fundamentally from their Cold War predecessors. Most ICs today have ‘new-style’ features, compulsory jurisdiction and access for non-state actors to initiate litigation, which scholars associate with greater independence and political influence. Most ICs today have a mandate that extends beyond inter-state dispute resolution. Chapters in the book chart the uneven jurisdictional landscape of ICs today, and offer an account of the proliferation of new-style ICs.

The book is first and foremost a social science treatment of the growing role of ICs in politics today. I argue that the trend of creating and using new-style ICs signals a transformation from international law being a breakable contract between governments towards a rule of law mentality. ICs are not, I argue, the vanguard of this political change.  Rather, the trend towards creating new-style ICs reflects the reality that international law increasingly speaks to how governments regulate national markets, treat their citizens and conduct war, and both citizens and governments want these increasingly intrusive international legal agreements to be respected. For the most part, ICs are doing exactly what governments tasked them to do. International judges are resolving questions about the law, and holding governments and international organizations to international legal obligations.

My primary objective is to understand how and when delegating authority to ICs transforms domestic and international relations. Continue reading…

Joint Opinio Juris-EJIL:Talk! Book Symposium this week

by An Hertogen

This week we are working with EJIL:Talk! to bring you a symposium on Karen Alter‘s (Northwestern) book The New Terrain of International Law: Courts, Politics, Rights (Princeton University Press). Here is the abstract:

In 1989, when the Cold War ended, there were six permanent international courts. Today there are more than two dozen that have collectively issued over thirty-seven thousand binding legal rulings. The New Terrain of International Law charts the developments and trends in the creation and role of international courts, and explains how the delegation of authority to international judicial institutions influences global and domestic politics.

The New Terrain of International Law presents an in-depth look at the scope and powers of international courts operating around the world. Focusing on dispute resolution, enforcement, administrative review, and constitutional review, Karen Alter argues that international courts alter politics by providing legal, symbolic, and leverage resources that shift the political balance in favor of domestic and international actors who prefer policies more consistent with international law objectives. International courts name violations of the law and perhaps specify remedies. Alter explains how this limited power–the power to speak the law–translates into political influence, and she considers eighteen case studies, showing how international courts change state behavior. The case studies, spanning issue areas and regions of the world, collectively elucidate the political factors that often intervene to limit whether or not international courts are invoked and whether international judges dare to demand significant changes in state practices.

From our side, Tonya Lee Putnam (Columbia – Political Science), Bill Burke-White (UPenn – Law) and Jacob Katz Cogan (Cincinatti – Law) will provide comments, followed by Karen’s response.

Across the Atlantic, comments will be provided by Antonios Tzanakopoulos (Oxford) and Nico Krisch (IBEI).

As always, we welcome readers’ comments!

Weekly News Wrap: Monday, April 21, 2014

by Jessica Dorsey

Your weekly selection of international law and international relations headlines from around the world:

Africa

Asia

Middle East and Northern Africa

Europe

Americas

UN/Other

Supreme Court Takes Jerusalem Passport Case on the Merits

by Peter Spiro

NY Times dispatch here. The Supreme Court will now confront the question of whether Congress can force the Secretary of State to include the birthplace “Jerusalem, Israel” at a U.S. citizen’s option. This could be a huge case or a not-so-huge case. If the Court affirms the D.C. Circuit’s ruling below and strikes down legislation purporting to constrain the Secretary of State’s passport authority, the ruling would be important but hardly epochal. That would protect the president’s authority over foreign relations, and fit neatly into a doctrinal tradition dating back at least a century. It is something new for the Court to get to the merits of the question — that’s why the decision in Zivotofsky I itself marked something of a watershed. If the Court accepts expansive executive branch powers, the jurisprudential gun remains loaded but no shots get fired.

But if the Court upholds the law, it will be a major departure from that tradition. The passport case implicates a genuinely sensitive issue of foreign relations. If the Court forces the State Department into something like formal acknowledgement of Israeli sovereignty over Jerusalem, who knows what would follow on the ground. This isn’t a case like Medellin, which predictably upset Mexico at the same time that our relations predictably weathered any such upset. Nor would it play out like Bond, which even if it restricts the Treaty Power will hardly be noticed by foreign audiences. To use the vocabulary of the foreign relations canon, a Supreme Court ruling against the executive branch in Zivotofsky could severely “embarrass” the President in the conduct of foreign relations. Think unruly crowds outside U.S. embassies.

That would have been inconceivable 20 years ago. But foreign relations law is being normalized. (For an excellent take on the shift, see Harlan Cohen’s piece here.) Foreign affairs has long been immune to judicial activism; maybe no longer. The Court may still hesitate to the extent it sees some real, even uncabinable, damage to the Middle East peace process in siding with Congress on the question. The easier path would have been to duck the case altogether. By accepting review, it may already have tipped its hand in a new direction.

On Steve Vladeck’s Post-AUMF Detention

by Deborah Pearlstein

Nothing like spring break (yes, we break right before semester’s end) to do a little catch-up reading – starting this week with Steve Vladeck’s new essay grappling with one of the nation’s most intractable problems: closing Guantanamo. Among the many challenges associated with the prison’s continued existence, Steve highlights its role in preventing serious consideration of repealing the AUMF (the federal statute authorizing the use of military force against Al Qaeda and associated groups). The Gitmo detainees are held under the domestic authority of the AUMF; as long as the government wishes to continue to hold at least some of the Gitmo prisoners (as it does), Congress can’t repeal the law without risking their potential release. Despite the winding down of U.S. operations in Afghanistan, the serious weakening of core Al Qaeda, and the President’s announced desire to move the nation away from a permanent wartime footing – AUMF repeal is essentially impossible as long as we are concerned with maintaining the legality of the Gitmo prisoners’ detention under domestic law.

So how to keep Gitmo from becoming the detention tail that wags the wartime dog? Steve proposes that even without an AUMF, we could continue to hold the approximately 45 Gitmo detainees the executive sees as the intractable core (those the administration has designated unprosecutable but too dangerous to release) under the authority of another federal law: Section 412 of the USA PATRIOT Act of 2001. Section 412 – which Steve notes has not been used once since its enactment in 2001 – requires the Attorney General to take into custody any alien he has reasonable grounds to believe is (for example) a member of a terrorist organization, or endorses or espouses terrorist activity, or “is engaged in any other activity that endangers the national security of the United States.” The alien may be detained for up to a week until the commencement of immigration removal proceedings or criminal prosecution, or for “additional periods of up to six months” if his “removal is unlikely in the reasonably foreseeable future,” and if release “will threaten the national security of the United States or the safety of the community or any person.”

Steve’s diagnosis of the relationship between Guantanamo Bay and the AUMF is spot on in some critical respects. The uniquely problematic nature of the Guantanamo detention program skews the current debate about the need for continuing use-of-force authority, just as surely as it has skewed broader debates about U.S. counterterrorism detention, trial, and interrogation policies for the past dozen years. For a host of reasons, the Gitmo population is singularly unrepresentative of the challenges that would be posed by counterterrorism detention or trial following the arrest of any terrorism suspect today: Gitmo detainees were denied basic Geneva protections (including any initial hearing about who these men actually were); some detainees were transferred there following periods of unlawful (even torturous) detention elsewhere; criminal counterterrorism laws that are today used for prosecution were much narrower extrajudicial scope in 2001; Congress maintains unprecedented restrictions on the transfer of detainees to the United States for any purpose; and so on. Indeed, as Steve recognizes, given all that has gone before, closing Gitmo now involves only bad options; the policy task is to choose which among these bad options is least worst under the circumstances.

Despite the low bar, I have to admit I’m still unconvinced that Section 412 is the least worst way to go. (more…)

Events and Announcements: April 20, 2014

by An Hertogen

Call for Papers

  • The European Society of International Law Interest Group on Peace and Security (ESIL IGPS) and the Research Project on Shared Responsibility in International Law (SHARES Project) organize a joint symposium to be held in conjunction with the 10th ESIL Anniversary Conference in Vienna, Austria, on September 3, 2014. The symposium is entitled “The Changing Nature of Peacekeeping and the Challenges for Jus ad Bellum, Jus in Bello and Human Rights” and it will discuss whether there indeed is a major shift in UN peacekeeping practice and will explore important questions of international law raised by these new practices. We would like to invite candidates to submit a 500 words abstract proposal via email to Prof. Theodore Christakis and Dr. Ilias Plakokefalos by May 4. The proposal should also include the author’s name and affiliation, the author’s brief CV and the author’s contact details, in a single pdf document. Successful applicants will be informed by May 15. More information is available here.

Events

  • ALMA and the Radzyner School of Law of the Interdisciplinary Center (IDC) invite you to the next session of the Joint International Humanitarian Law Forum on April 30, 2014, 18:30 in room C110 (Arazi-Ofer Building, 2nd floor) in the IDC. Prof. Eugene KontorovichDr. Daphne Richemond-Barak and Dr. Ziv Bohrer will discuss the Crimean Peninsula & IHL. Following the presentations, there will be an open round table discussion.
  • Professor Harold Koh will be giving this year’s Clarendon lectures at the University of Oxford, speaking about Law and Globalization. The lectures are open to everyone and will take place over three evenings: Tuesday May 6, 5-6:30pm in the Pichette Auditorium, Pembroke College, followed by a drinks reception in the foyer by the auditorium 6:30-7:30pm; Thursday May 8, 5-6:30pm, The Gulbenkian Lecture Theatre, Faculty of Law, St Cross Building: Tuesday May 13, 5-6:30pm, The Gulbenkian lecture theatre, Faculty of Law, St Cross Building.
  • The T.M.C. Asser Instituut is offering five different summer programmes this summer: June 2 – 25: Summer Law Program on International Criminal Law and International Legal Approaches to Terrorism; June 30 – July 4: Summer Programme on International Sports Law: Is Sport Playing by the Rule of Law?; August 25 – 29: Advanced Summer Programme on Countering Terrorism in the Post 9/11 World: Legal Challenges and Dilemmas; August 25 – 29: Summer Programme on International & European Environmental Law: Facing the Challenges?(New in 2014!); September 1 – 5: Summer Programme on Disarmament & Non-Proliferation of Weapons of Mass Destruction in a Changing World (Scholarships available!). More information is available here.
  • The Interest Group on Migration and Refugee Law of the European Society of International Law, the Centre for Migration Law of the Radboud University Nijmegen and the Amsterdam Center for International Law of the University of Amsterdam are pleased to announce Heading to Europe: Safe Haven or Graveyard?, a panel discussion on migration by sea in the Mediterranean. The panel discussion will be held on 16 May 2014 at the Radboud University Nijmegen. For more information and registration visit the website.
  • The Salzburg Law School on International Criminal Law, Humanitarian Law and Human Rights Law (SLS) welcomes applications for its Sixteenth Summer Session, “International Criminal Law at the First World War Centenary – From Consolidation Towards Confrontation?”, Sunday 3 to Friday 15 August 2014. The SLS is a two-week summer programme aimed at postgraduate students, young academics and practitioners. This year’s session will scrutinize principles and procedures of international criminal law, their origins and contemporary challenges to their enforcement. In this context, there will be a special thematic focus on the principle of irrelevance of official capacity under international customary law and the Rome Statute of the International Criminal Court (ICC) as well as on controversies stemming from the Court’s cases against sitting heads of States, proposed changes to the Rome Statute and policy considerations determining the selection of situations and cases. Other topics include the Kampala amendments to the Rome Statute, the rights of the defence in international criminal proceedings, the role of international investigation commissions, as well as recent decisions and judgements of the ICC and the ICTY. Further information on the academic programme and a preliminary list of speakers are available here. The application period ends on Friday May 9, 2014.
  • The Geneva Academy of International Humanitarian Law and Human Rights is offering an International Weapons Laws Course, in Geneva from August 4-29, 2014. More information is here.

Last week’s events and announcements can be found here. If you would like to post an announcement on Opinio Juris, please contact us.

Weekend Roundup: April 5-18, 2014

by An Hertogen

This fortnight on Opinio Juris, Julian examined whether the US could legally deny Iran’s new U.N. Ambassador a visa to New York and provided his take on the three main arguments in favor of the visa denial. In a rare instance, Kevin agreed with Julian and elaborated with a post on the security exception in the UN Headquarters’ Agreement.

David Rivkin and Lee Casey surprised Julian with their calls to deploy “lawfare” against Russia. More surprises for Julian arose out of the U.S. District Court for the Southern District of New York’s decision to revive the In re South Africa Apartheid Litigation under the ATS.

In other posts, Kristen wondered how the current gap in international law on the protection of disaster refugees could be filled; Roger discussed the emerging trend of relying on investment arbitration to enforce international trade rights; Craig Allen contributed a guest post on the principle of reasonableness applied by ITLOS in the M/V Virginia G case; and Kevin shared his thoughts on Ukraine’s ad hoc self-referral to the ICC.

Duncan announced the Oxford Guide to Treaties he edited is now available in paperback, and welcomed the publication of a papers presented at a Temple workshop on the writings of Martti Koskenniemi.

As always, we listed events and announcements (1, 2) and Jessica wrapped up the news (1, 2).

Have a nice weekend!

Thoughts on the Ukraine Ad Hoc Self-Referral

by Kevin Jon Heller

As readers no doubt know, Ukraine has accepted the ICC’s jurisdiction on an ad hoc basis for acts committed between 21 November 2013 and 22 February 2014. The self-referral has already led to a good deal of intelligent commentary — see, for example, Mark Leon Goldberg’s discussion of the politics of an ICC investigation here and Mark Kersten’s convincing argument that Russia may not be particularly opposed to an ICC investigation here. I just want to add a few additional thoughts.

To begin with, I remain troubled by the insistence of Ukraine’s Constitutional Court that Ukraine cannot delegate its adjudicative jurisdiction to an international court. As it said in 2001:

Article 124 of the Ukrainian Constitution states that the administration of justice is the exclusive competence of the courts and that judicial functions cannot be delegated to other bodies or officials. The Constitutional Court noted that the jurisdiction of the ICC under the Rome Statute is complementary to national judicial systems. However, under Article 4(2) of the Rome Statute, the ICC may exercise its functions and powers on the territory of any State party, and under Article 17, the ICC may find a case to be admissible if the State is unwilling or unable genuinely to carry out the investigation or prosecution. The Court concluded that jurisdiction supplementary to the national system was not contemplated by the Ukrainian Constitution. Hence, the amendment of the Constitution is required before the Statute can be ratified.

Parliament’s acceptance of the ICC’s jurisdiction, even on an ad hoc basis, seems specifically foreclosed by the Constitutional Court’s judgment. Ukraine’s President and Parliament clearly don’t care about that inconvenient fact; will the ICC? Martin Holtermann may be right — the ICC may simply defer to Ukraine’s President and Parliament. But I can help but think it would be unseemly for an international court like the ICC to simply ignore a clear judgment issued by the highest court in a state purporting to accept its jurisdiction. At the very least, Fatou Bensouda should take the Ukraine’s internal conflict into account when she decides whether to open a formal investigation — you can bet that any suspect wanted by the ICC would challenge the legality of the self-referral in Ukraine’s domestic courts, litigation that could make it very difficult for ICC proceedings to go forward.

Relatedly, I think it’s important to remind ourselves that Ukraine’s self-referral does not mean the OTP will open a formal investigation into the situation. Diane Amann writes today that the self-referral shows “Europe is on [the] ICC docket.” That’s true — but only in the formal sense. As Mark Kersten noted in February, Europe has been on the ICC docket for a long time in terms of preliminary investigations. After all, the OTP announced the Georgia investigation in August 2008 — nearly six years ago. (Its Afghanistan investigation has been plodding along even longer, since 2007.) That hasn’t quelled the voices that have been complaining — with justification — that the ICC has been overly obsessed with Africa. So unless and until the OTP decides to open a formal investigation into the situation in Ukraine, the country’s self-referral is unlikely to have any positive effect whatsoever on the Court’s African reputation.

Finally, a brief thought on the temporal limits of the self-referral. I don’t think the ICC will reject the referral on the ground that it is too carefully tailored to ensure only one side of the conflict. (A major problem with Comoros’s Mavi Marmara state referral.) The temporal limits, however narrow, make some sense — the referral begins when Yanukovych announced Ukraine was abandoning the agreement with the European Union and ends when Yanukovych fled the country. Should Ukraine have accepted the ICC’s jurisdiction for a longer period — most notably, to include Russia’s invasion of Crimea? I had an interesting twitter debate earlier today on that issue with a bunch of smart Court-watchers, including Ryan Goodman, Eugene Kontorovich, Mark Kersten, Martin Holtermann, and David Kaye. I pointed out that it’s difficult to see what international crimes Russia committed during the invasion, other than the non-prosecutable crime of aggression. Ryan replied that a longer self-referral could give the ICC an opportunity to address important issues in the law of occupation. (See also his post here.) That’s absolutely true — but only if Russia actually violates the law of occupation, which seems unlikely given the popularity (certainly not uniform) of the invasion and annexation within Crimea itself. The wildcard is the crime that Eugene mentioned during our discussion — the transfer of civilians into occupied territory. I have no idea whether Russia intends to directly or indirectly transfer Russians into Crimea; Eugene seems to think it does, and I will defer to his greater knowledge of the situation. But my position with regard to that possibility is the same as my position on Israel’s transfer of civilians into the West Bank: whatever the merits of the allegations, the war crime is legally uncertain and factually difficult to prove, especially when the transfer is indirect instead of direct — which it is in the West Bank and would almost certainly be in Crimea. In the absence of other violations of the law of occupation, therefore, I am not sure the OTP would get involved.

I imagine we will have much more to discuss concerning the ICC and Ukraine in the weeks to come!

The Case That Won’t Die: U.S. Court Revives South Africa Apartheid Alien Tort Statute Lawsuit

by Julian Ku

So maybe the use of the Alien Tort Statute against corporations for overseas activities isn’t fully dead. Yesterday, the U.S. District Court for the Southern District of New York has revived In re South Africa Apartheid Litigation, a twelve-year-old litigation that just won’t die. A copy of the opinion can be found here.

Most of the opinion deals with whether a corporation may be sued under the Alien Tort Statute, an issue most thought was settled within the Second Circuit (the federal appeals circuit that includes New York). As a lower court within that circuit, the district court should have been bound to follow that court’s 2010 opinion Kiobel v. Royal Dutch Shell, which held that corporations cannot be sued under the ATS.  The lower court judge, Shira Scheindlin, decided that since the Supreme Court had ended up dismissing the Kiobel plaintiffs on other grounds (e.g. extraterritoriality), the Court had sub silentio reversed the original Kiobel decision’s ruling on corporate liability.  That is quite a stretch, and appears based almost solely on the Supreme Court’s reference to “mere corporate presence” as being insufficient to overcome the statutory presumption against extraterritoriality.  This language, and the Supreme Court’s decision not to otherwise mention the corporate liability issue, was enough for Judge Scheindlin to revisit the corporate liability issue.  I don’t really buy this sub silentio interpretation of Kiobel, but to give credit where credit is due, this argument was previewed in our Kiobel insta-symposium by Jordan Wells, a third year law student.  Let’s just say Judge Scheindlin really went out of her way to re-open this question.  

My views on the corporate liability issue haven’t changed since I published my full length attack on it back in 2010.  In my view, the Supreme Court’s decision in Mohamad v. Palestinian Authority, finding that the Torture Victim Protection Act does not allow torture claims against corporate defendants, provides an unappreciated boost to the policy rationale for limiting these kinds of lawsuits to natural persons.  But other circuits, and apparently Judge Scheindlin, refuse to agree with me (I know, I know, it’s hard to believe, but it’s true).

Putting aside the corporate liability issue, it is perhaps more surprising that Judge Scheindlin did not simply dismiss all of the defendants on Kiobel extraterritoriality grounds.  The Second Circuit appeals panel in this case held that all of the defendants (U.S. and foreign) should be dismissed because all of the alleged relevant conduct occurred in South Africa.  The U.S. corporate defendants (Ford and IBM) did not overcome the Kiobel presumption because the complaints only allege vicarious liability as parent corporations to their South African subsidiaries.   Yet Judge Scheindlin only dismissed the foreign defendants and will allow the plaintiffs to re-file their complaints against the US defendants to overcome the new Kiobel extraterritoriality presumption.  This means that she is willing to explore in greater detail the Kiobel requirement that plaintiffs’ claims “touch and concern” the territory of the U.S. with sufficient force to displace the presumption against extraterritoriality.  Will knowledge by the US parent of the subsidiaries’ activities in South Africa be enough? Will receiving profits from the subsidiaries be enough? I assume that is the best the plaintiffs will be able to plead is knowledge by the U.S. parent.

I assume this is going back to the appeals panel in this case, and we should expect some rather testy reactions. Judge Jose Cabranes (the author of the appeals court panel decision) and Judge Scheindlin have recently tangled over a local NY case against aggressive police tactics resulting in the controversial removal of Judge Scheindlin from that case (Judge Cabranes was one of three judges involved in that removal order).  This latest Scheindlin order seems a double-insult at Judge Cabranes.  It “reverses” his earlier Kiobel decision on corporate liability (from a lower court no less!), and then it ignores his subsequent opinion holding that all defendants should be dismissed via a motion for judgment on the pleadings.   A little tension brewing at 40 Foley Square, perhaps?

Guest Post: Law Of The Sea Tribunal Implies A Principle Of Reasonableness In UNCLOS Article 73

by Craig H. Allen

[Craig H. Allen is the Judson Falknor Professor of Law and of Marine and Environmental Affairs at the University of Washington.]

On April 14, 2014, the International Tribunal for the Law of the Sea (ITLOS) issued its ruling in the M/V Virginia G case (Panama/Guinea-Bissau), Case No. 19.  The dispute arose out of  Guinea-Bissau’s 2009 arrest of the Panama-flag coastal tanker M/V Virginia G after it was detected bunkering (i.e., delivering fuel to) several Mauritanian-flag vessels fishing in the Guinea-Bissau exclusive economic zone (EEZ) without having obtained a bunkering permit.  The case presented a number of issues, including whether the 1982 UN Convention on the Law of the Sea (UNCLOS), to which both states are party, grants a coastal state competency to control bunkering activities by foreign vessels in its EEZ.

After disposing of objections raised over jurisdiction and admissibility (notwithstanding the parties’ special agreement transferring the case to ITLOS), the decision adds a substantial gloss to several articles of the UNCLOS, particularly with respect to Article 73 on enforcement of coastal state laws regarding the conservation and management of living resources in the EEZ. Among other things, Panama alleged that Guinea-Bissau violated each of the four operative paragraphs of Article 73 in its boarding, arrest and confiscation of the Virginia G and by seizing and withholding the passports of its crew for more than 4 months. The tribunal’s holding can be summarized as follows:  (more…)

Using Investment Arbitration to Enforce WTO Commitments

by Roger Alford

plainpackagingI would like to continue the theme of the emerging convergence of investment arbitration and international trade. In my previous posts (discussed here and here) I discussed the prospect of using trade remedies to enforce investment arbitration awards. Another key example of convergence addresses the emerging trend of relying on investment arbitration to enforce international trade rights. As discussed in my recent article, despite the assumption that international trade disputes must be resolved before the WTO DSB, the existence of broad umbrella clauses in BITs present a promising vehicle for enforcing investment commitments in trade agreements.

Of course, the scope of umbrella clauses is dependent on the language in particular BITs, which varies widely from one treaty to the next. Accordingly, there is no uniform understanding as to the meaning of umbrella clauses. Narrow umbrella clauses are unlikely vehicles for vindicating international trade rights. A treaty commitment such as that addressed in SGS v. Philippines to observe any obligation a Contracting State “has assumed with regard to specific investments” is unlikely to encompass legislative measures or treaty commitments. By contrast, broad umbrella clauses are better candidates for vindicating trade rights, such as the BIT clause at issue in Noble Ventures, Inc. v. Romania, which committed Romania to “observe any obligation it may have entered into with regard to investments.”

ICSID tribunals have interpreted broad umbrella clauses to give investors treaty rights with respect to unilateral undertakings of the State embodied in municipal law. In CMS Gas Transmission Co. v. Argentina, the tribunal concluded that utility tariffs designed to attract foreign investment were “legal … obligations pertinent to the investment.” In LGE v. Argentina, the tribunal concluded that abrogation of guarantees made to investors in a statutory framework gave rise to liability under the umbrella clause. In Enron v. Argentina, another tribunal concluded that the umbrella clause referred to “any obligations regardless of their nature.” This included not only contractual obligations, but also “obligations assumed through law or regulation” that are “with regard to investments.” In Sempra Energy International v. Argentina, a tribunal found that major legal and regulatory changes introduced by the State as part of its public function constituted treaty violations under the umbrella clause. Finally, in SGS v. Paraguay, a tribunal interpreted a broad umbrella clause as creating “an obligation for the State to constantly guarantee observance of its commitments entered into with respect to investments of investors of the other party. The obligation has no limitations on its face—it apparently applies to all such commitments, whether established by contract or by law, unilaterally or bilaterally.”

Note that these sweeping pronouncements do not require that a State’s commitment reference a specific investment or contract. As long as legislative or executive measures relate to the promotion or regulation of investments, they constitute unilateral undertakings covered by a broad umbrella clause. Such ICSID jurisprudence has led María Cristina Gritón Salias to conclude in this book that “tribunals overwhelmingly accept the application of umbrella clauses to obligations assumed unilaterally by host States,” whether those undertakings are “made through legislation or otherwise.” Likewise, Darius Chan has opined here that “the current tide of jurisprudence concerning umbrella clauses is in favor of such clauses encompassing host State commitments of all kinds.”

Assuming such interpretations are correct—which is by no means clear—this has significant implications for the WTO. If trade obligations are subject to investment arbitration, it would authorize private parties to initiate trade cases. Private rights of action through investment arbitration would supplement the diplomatic espousal of claims before the WTO.

This is precisely what one foreign investor has argued with respect to alleged WTO violations as a result of Australia’s plain-packaging laws. On November 21, 2011, Philip Morris Asia Ltd. filed an investment arbitration claim against Australia pursuant to the Hong Kong-Australia Bilateral Investment Treaty. The central contention of Philip Morris is that Australia’s plain packaging legislation violated various international obligations. Among the claims it filed is one under the broad “umbrella clause” in the BIT, which provides that “[e]ach Contracting Party shall observe any obligation it may have entered into with regard to investments of investors of the other Contracting Party.” According to the Notice of Arbitration:

This [umbrella clause] obligation is broader than specific obligations … made by the host State to investors…. It also encompasses other international obligations binding on the host State that affect the way in which property is treated in Australia…. [T]he relevant obligations are those enshrined in TRIPS, the Paris Convention, and TBT. [Claimant] as an owner of the investments is entitled to expect Australia to comply with its obligations pursuant to those treaties. By adopting and implementing plain packaging legislation, Australia has failed to observe and abide by those obligations.”

In response, Australia argued that:

The meaning and scope of such provisions is a matter of great controversy. However it is clear in the instant case that … the “umbrella clause” in Article 2(2) cannot be understood as encompassing general obligations in multilateral treaties…. Rather … the “umbrella clause” … only covers commitments that a host State has entered into with respect to specific investments…. [T]he obligations under the multilateral treaties … are not “obligations” which have been entered into with regard to investments of investors” of Hong Kong, but are rather obligations that operate on the inter-State level, with their own particular inter-State dispute resolution procedures.

It is too early to assess the likely success of such claims, but if the recent “umbrella clause” jurisprudence is accurate the claims are at least colorable.

This potential convergence of trade and arbitration has profound implications for the resolution of WTO violations. An arbitration panel liberally construing a broad umbrella clause could transform how WTO obligations are adjudicated. Exactly how would the adjudication of WTO obligations through investment arbitration alter the landscape? Here are a few thoughts.

First, umbrella clauses in BITs could create a private right of action for resolving WTO disputes. Investment arbitration circumvents the traditional barriers to initiating a WTO dispute. Diplomatic espousal is no longer a reliable check on the pursuit of unmeritorious claims. Through umbrella clauses foreign investors could seek recourse for violations of investment obligations that form part of WTO disciplines.

Second, with WTO dispute settlement the Member States control all decisions with respect to adjudication and resolution of the dispute. Investors may prefer an alternative dispute settlement process that places such decisions within their control. The incentives to settle an investment dispute depend on satisfying investors concerns rather than satisfying the disputing Member States’ concerns.

Third, with limited exceptions, the WTO prohibits unilateral trade remedies. Article 23 of the DSU provides that Member States “shall not make a determination to the effect that a violation has occurred … except through recourse to dispute settlement in accordance with the rules and procedures of this Understanding.” Investment arbitration is not a unilateral remedy imposed in response to a WTO violation, but neither is it WTO dispute settlement. Investment arbitration may provide a vehicle for compensating or attenuating the harm caused to investors without offending the WTO restrictions on unilateral trade remedies.

Fourth, WTO remedies are prospective, while investment arbitration remedies may be retroactive. The goal of the WTO adjudication is to bring Member States into conformity with their trade obligations. The goal of investment arbitration is, consistent with traditional understandings of state responsibility, to “wipe-out all the consequences of the illegal act and reestablish the situation which would, in all probability, have existed if that act had not been committed.”

Fifth, under the WTO dispute settlement process, any losses an investor suffers as a result of a Member State’s WTO violation are not compensable. WTO remedies contemplate compensation directly to a Member State or, failing that, the suspension of concessions paid directly to the Member State in the form of increased duties. With investment arbitration, international law violations result in monetary compensation due directly to the investor.

Thus, liberal interpretations of broad umbrella clauses that encompass investment commitments in WTO undertakings may prove to be an attractive avenue for future investment arbitration.

Engaging the Writings of Martti Koskenniemi

by Duncan Hollis

MK2r_hollis (2)

Last Spring, Temple Law School was pleased to host a two day workshop on the scholarship of one of international law’s true giants – Martti Koskenniemi (simply put, I’m a big fan). Organized by my colleague, Jeff Dunoff, it was a great event with a wide-ranging conversation launching off Martti’s works in international legal theory, international legal history, fragmentation, interdisciplinary scholarship, ethics and the future of international law.  

Given how great the workshop was, I could not be more pleased to note that the accompanying papers have now been compiled and published in a single volume of the Temple International and Comparative Law Journal (vol. 27, no. 2). The full table of contents for the Symposium Issue can be found here

The papers include Jeff Dunoff’s framing introduction, a fascinating paper by Martti on the historiography of international law, and a slew of papers by renowned scholars, including Kim Scheppele, Tomer Broude, Sean Murphy, Mark Pollack, Rob Howse and Ruti Teitel, Samuel Moyn, Jan Klabbers, Andrew Lang and Susan Marks, Frédéric Mégret, and Ralf Michaels.  These papers address a number of themes that run through Koskenniemi’s work, including international law and empire; the fragmentation of international law; interdisciplinary approaches to international law; reading – and misreading – the tradition; and the international lawyer as ethical agent.  Both individually and collectively, the papers represent a significant effort to engage, explore, and extend the ideas found in Koskenniemi’s writings.

The special symposium issue is the first of what will be a tradition of yearly Symposia that will be organized by Temple faculty and published in the Journal.  As such, the Symposia marks a new form of collaboration between Temple faculty and students, and represent an experiment in academic publishing designed to provide students the experience of editing papers on cutting-edge research, and at the same time injecting faculty expertise into the selection and substantive editing of papers.