International Law Review

International Law Review

Exhaustion of Local Remedies Rule in Investment Lawsuits with an Emphasis on the Denial of Justice Lawsuit in Loewen v. United States of America Case

Document Type : academic

Authors
Eeta Khosro khakpour 1
Mohsen Mohebi 2
1 Ph. D. Candidate in International law, Islamic Azad University, Science and Research Branch, Tehran
2 Assistant Professor, Islamic Azad University, Science and Research Branch, Faculty of Law, Tehran
10.22066/cilamag.2023.704213
Abstract
The cornerstone of international investment law is to ensure the foreign investor's rights through international law standards including fair and equitable treatment. If the host state violates the standards, the foreign investor will not be obliged to raise a claim before local courts prior to international settlement of dispute. In contrast, in denial of justice, the investor must exhaust local remedies before seeking international redress. So in this respect, The Loewen case as an important arbitral practice on the relationship of denial of justice and exhaustion of local remedies will be analyzed in this article. The approach of Investment treaties will also be evaluated. This article concluded that arbitral tribunal in Loewen has made mistake by distinction between local remedies and finality rule. In order to resolve this ambiguty and confusion in investment arbitration in the field of denial of justice, one should wait for the treaty procedure of the states in bilateral or multilateral treaties for mutual encouraging and supporting of investment
Keywords
International Investment Law
Protection of Foreign Investor
Denial of Justice
Exhaustion of Local Remedies
International Arbitration

Subjects

  1. الف. فرانسوی

    - Book

    1. De Visscher, C,‌‌‌ Note on the Responsabilité internationale des États et la protection diplomatique d’après quelques documents récents, 8 RDILC, 1927.

    ب. انگلیسی

    Books

    1. Amerasinghe, Chittharanjan Felix, Local Remedies in International Law, Cambridge University Press, 2005, Second Edition.
    2. Borchard, Edwin M., The Diplomatic Protection of the Citizens Abroad, Gale Making of Modern Law, 4 September 4 2013.
    3. Freeman, Alwyn, The International Responsibility of States for Denial of Justice, Kraus Reprint Company, 1970.
    4. McLachlan, Campbell, Shore, Laurence, Weininger, Mattheew, International Investment Arbitration, Substantive Principles, Oxford University Press Oxford, 2007.
    5. Paulsson, John, Denial of Justice in International Law, Cambridge University Press, 2005.
    6. Schreuer, C., The ICSID Convention: A Commentary, Cambridge University Press,
    7. Schwebel, S., International Arbitration: Three Salient Problems, Grotius 1987.
    8. Sophia Tang, Zheng, Jurisdiction and Arbitration Agreements in International Commercial Law, Routledge, 2014.

     

    - Articles

    1. Borchard, Edwin M., “Responsibility of States at Hague Codification Conference”, American Journal of International Law, vol. 24, Issue 3, 1930.
    2. ________, “The International Responsibility of States for Denial of Justice, By Alwyn V. Freeman, (London and New York: Longmans, Green and Company, 1938)” , American Political Science Review, vol. 33, Issue 5, 1939.
    3. ________, “The Law of Responsibility of States for Damage Done in their Territory to the Person or Property of Foreigners”, The American Journal of International Law, vol. 23, No. 2, 1929.
    4. Don Wallace, Jr., “State Responsibility for Denial of Substantive and Procedural Justice under NAFTA Chapter Eleven”, vol. 23, Issue 3, 2000.

     

    1. Eagleton, Clyde, “Denial of Justice in International Law, Journal of International Law, vol. 22AM, 1928.
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    6. Doge, William, “National Courts and International Arbitration: Exhaustion of Remedies and Res Judicata under Chapter Eleven of NAFTA”, Hastings International and Comparative Law Review, vol. 23, 2000.
    7. Spiegle, Hans W., “Origin and Development of Denial of Justice”, The American Journal of International Law, vol 32, 1938.
    8. Trindade, A. A. Cancado, “Denial of Justice and its Relationship to Exhaustion of Local Remedies in International Law”, Philippine Law Journal, vol. 53, No. 4, December 1978.

     

    - Cases

    1.         Ambatielos Case, Greece v. United Kingdom, ICJ Rep 10, 19th May 1953.

    1. AMTO LLC Ukraine, Final Award, SCC Case No. 080/2005, 26 March 2008.
    2. Azinian and Ors Mexico, Award on Jurisdiction and Merits, ICSID Case No. ARB(AF)/97/2, IIC 22 (1999), (2000) 39 ILM 537, 18th October 1999, despatched 1st November 1999.

    4.         Certain Norwegian Loans, France v. Norway, Judgment, Jurisdiction, ICJ Rep 9, 6th July, 1957.

    5.         Ethyl Corporation v. Canada, Decision on Jurisdiction, (1998) 7 ICSID Rep 12, (1999) 38 ILM 708, IIC 95 (1998), 24th June 1998, Ad Hoc Tribunal (UNCITRAL).

    1. Generation Ukraine, Inc. Ukraine, ICSID Case No. ARB/00/9.
    2. Himpurna California Energy Republic of Indonesia, UNCITRAL ,4 May, 1999.

    8.         Interhandel, Switzerland v. United States, Preliminary Objections, Judgment, ICJ GL No 34, 21st March 1959.

    9.         Iran-US Claims Tribunal, Oil Fields Of Texas, Inc. v. Iran et al., 1 IRAN-U.S. C.T.R.

    1. Jan de Nul N.V. and Dredging International N.V. v. Arab Republic of Egypt, ICSID Case No. ARB/04/13.
    2. Loewen United States, Award, ICSID Case No. ARB (AF)/98/3 (26 June 2003), (2003) 42 LLM811.
    3. Marvin Roy Feldman Karpa United Mexican States, ICSID Case No. ARB (AF)/99/1.
    4. Metalclad Corporation Mexico, Award, ICSID Case No. ARB(AF)/97/1, (2001) 16 ICSID Rev-FILJ 168, (2001) 40 ILM 36, (2001) XXVI YB Com Arb 99, (2002) 119 ILR 618, (2002) 5 ICSID Rep 212, (2001) 13(1) World Trade and Arb Mat 45, IIC 161 (2000), 25th August 2000, despatched 30th August 2000, United Nations [UN]; World Bank; International Centre for Settlement of Investment Disputes [ICSID]
    5. Mondev International Ltd. United States of America, ICSID Case No. ARB (AF)/99/2, Award, Oct. 11, 2002.
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    7. Petrobart Limited Kyrgyzstan, Award, SCC Case No. 126/2003, 29 March 2005.
    8. Saipem Bangladesh, Award, ICSID Case No. ARB/05/7, 20 June 2009.

    18.     SD Myers Incorporated v. Canada, Order, 2004 FC 38, (2004) 244 FTR 161, IIC 252 (2004), 13th January 2004, Canada; Federal Court [FC].

    1. Waste Management, Inc United Mexican States, Award, 30 April 2004, 43 ILM (2004) 967.

     

    - Documents

    1. Guerrero Report to the League of Nations Committee of Experts for the Progressive Codification of International Law, cited in: YBILC (1956), vol. 2, p. 222.
    2. North American Free Trade Agreement (NAFTA), 17 December, 1992.
    3. Remarks by Professor Jack J. Coe, Jr., at a Conference on NAFTA Held at the Chicago-Kent Law School on Mar. 5, 2003.
    4. UN Doc A/CN4/498, International Law Commission (ILC), Second Report on State Responsibility, 3 May–23 July 1999.
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    - Websites

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  • Receive Date 08 January 2020
  • Revise Date 05 October 2020
  • Accept Date 06 October 2020