The Mauritius Convention on Transparency: Comments on the Treaty and its Role in Increasing Transparency in Investor-State Arbitration

21 Pages Posted: 8 Oct 2016

See all articles by Lise Johnson

Lise Johnson

Columbia Center on Sustainable Investment

Date Written: September 1, 2014

Abstract

Since 2008, the United Nations Commission on International Trade Law (UNCITRAL) has officially recognized the “importance of ensuring transparency in investor-State dispute resolution.” In July 2013, it reached an important milestone in turning that principle into law. Recognizing “the need for provisions on transparency in the settlement of treaty-based investor-State disputes to take account of the public interest involved in such arbitrations,” UNCITRAL adopted the Rules on Transparency in Treaty-Based Investor-State Arbitration (“Transparency Rules” or “Rules”). Those Rules, which require disclosure of a wide range of information submitted to and issued by tribunals, and facilitate participation by amicus curiae and nondisputing State parties, will do much to transform – and open up –investor-State disputes, when the rules apply.

Notably, however, Article 1(2) of the Transparency Rules requires certain conditions to be satisfied before the Transparency Rules can apply to any arbitration arising under any of the approximately 3000 treaties that were concluded before the Rules entered into force on April 1, 2014. Namely, for the Rules to apply under those “existing treaties,” either (1) the investor’s home State and the respondent have to expressly agree, after April 1, 2014, to apply the Rules to their treaty (and all disputes arising under it); or (2) the investor and respondent State must agree to apply the Rules in the context of a particular dispute.

This provision requires States and/or investors to expressly “opt in” to the Transparency Rules for disputes arising under existing treaties. Given that it is this vast mass of existing treaties that is likely to give rise to the bulk of investment arbitrations for the foreseeable future, the hurdle imposed by Article 1(2) risks undermining UNCITRAL’s overarching goal of ensuring transparency in investor-State arbitration. To address that issue, UNCITRAL decided to create another instrument that States could use to require application of the Transparency Rules to any investment arbitration arising under their existing treaties.

In July 2014, UNCITRAL finalized and adopted the “Mauritius Convention on Transparency” (“Transparency Convention”). This treaty establishes a mechanism through which all parties to existing investment treaties can efficiently and effectively update the procedural rules governing investor-State arbitrations under those treaties so as to effectively implement the Transparency Rules and better take into account the public interest nature of these disputes.

In order to promote greater awareness and understanding of the Convention, this paper reproduces its text and, after each article, provides additional comments on the provisions. The commentary is based on attendance at UNCITRAL’s sessions, as well as written public records of the negotiations.

Suggested Citation

Johnson, Lise, The Mauritius Convention on Transparency: Comments on the Treaty and its Role in Increasing Transparency in Investor-State Arbitration (September 1, 2014). Available at SSRN: https://ssrn.com/abstract=2848333 or http://dx.doi.org/10.2139/ssrn.2848333

Lise Johnson (Contact Author)

Columbia Center on Sustainable Investment ( email )

New York, NY
United States

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