Counterclaims in Investor-State Arbitration
The British Institute of International and Comparative Law (BIICL); University of West London
August 5, 2011
LSE Legal Studies Working Paper No. 8/2011
This paper provides a comprehensive analysis of the legal regime governing counterclaims in investor-State disputes. It challenges the frequent presumption that the right to assert counterclaims is hindered by the fact that investment treaties impose no obligations on foreign investors and only protect their rights. The paper demonstrates that the right to assert counterclaims is a procedural right, and subject matter jurisdiction over counterclaims depends on whether the investor has breached obligations found in applicable law. The paper shows that foreign investors’ substantive obligations can be found in sources of international law other than investment treaties. The paper also highlights the difficulties of asserting counterclaims in non-commercial areas such as human rights and environmental protection. Finally, it also shows that tribunals may pierce the corporate veil of foreign investors in the context of counterclaims.
The final version of this paper is available at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1993116
Number of Pages in PDF File: 31
Date posted: August 5, 2011 ; Last revised: September 14, 2012