UNASUR Centre for the Settlement of Investment Disputes: Comments on the Draft Constitutive Agreement

Abstract

The idea of creating the Centre for the Settlement of Investment Disputes (Centre) of the Union of South American Nations (in Spanish, UNASUR) emerged in 2008. Ecuador, a UNASUR member state, denounced the Convention on the Settlement of Investment Disputes between States and Nationals of Other States (ICSID) in 2009, and in 2010 submitted a proposal for the Centre. In 2012 UNASUR finished drafting the Draft Constitutive Agreement of the Centre for the Settlement of Investment Disputes of the UNASUR (CA). A new version of this document exists since 2014.

The Latin American media has recently reported that the UNASUR Working Group of High level Experts on the Settlement of Investment Disputes (Group) has reached a consensus on nearly 80 per cent of the 2014 draft. This means that the Centre may be about to be created. However, a priori, this must be taken with caution as Article 12 of the UNASUR Constitutive Agreement states that “all the norms of UNASUR shall be adopted by consensus” and as, according to different sources of information, there is a lack of consensus on matters of the CA that are not trivial at all.

Based on what is known about the text so far, the CA contains 41 articles, divided into six titles. The objective of this article is to describe the most relevant rules of the CA.

Keywords: UNASUR, IISD, investment arbitration, Latin America

JEL Classification: K33, K30, K40, K41, C10, F02, F13, F21, F30, H77, E22, H87, K20, O10, K19