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Judicial Review of Investment Treaty Awards: BG Group v. Argentina

Published online by Cambridge University Press:  20 January 2017

Anthea Roberts  and
Christina Trahanas
Anthea Roberts
Affiliation:
Of the Board of Editors
Christina Trahanas
Affiliation:
New York University
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Type
International Decisions
Information
American Journal of International Law , Volume 108 , Issue 4 , October 2014 , pp. 750 - 763
Copyright
Copyright © American Society of International Law 2014

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References

1 BG Grp. PLC v. Republic of Arg., 134 S.Ct. 1198 (2014).

2 Convention on the Settlement of Investment Disputes Between States and Nationals of Other States, Art. 52(1)(b), Mar. 18, 1965, 17 UST 1270, 575 UNTS 159 [hereinafter ICSID Convention].

3 Id., Art. 54(1).

4 Convention on the Recognition and Enforcement of Foreign Arbitral Awards, Arts. III, V, June 10, 1958, 21 UST 2517, 330 UNTS 3 [hereinafter New York Convention].

5 Many states have adopted the UNCITRAL Model Law on International Commercial Arbitration, which creates a mirror image between these grounds. UNCITRAL Model Lawon International Commercial Arbitration (June 21, 1985), as amended July 7, 2006, Arts. 34, 36, in UN GAOR, 40th Sess., Supp. No. 17, at 81, UN Doc. A/40/17 (1985), & UN GAOR, 61st Sess., Supp. No. 17, at 56, UN Doc. A/61/17, UN Sales No. E.08.V.4 (2008) [hereinafter UNCITRAL Model Law].

6 Id., Art. 34(2)(a)(iii); New York Convention, supra note 4, Art. V(1)(c).

7 Agreement for the Promotion and Protection of Investments, UK-Arg., Dec. 11, 1990, 1993 UKTS No. 41, 1765 UNTS 33.

8 BG Grp. Plc. v. Republic of Arg., Final Award, paras. 84–85 (Arb. Trib. Dec. 24, 2007), at http://italaw.com.

9 Id., para. 141.

10 Id., para. 142.

11 Id., para. 467.

12 Id., para. 147.

13 Id., paras. 155–57.

14 Id., para. 147; See Vienna Convention on the Law of Treaties, Art. 32, May 23, 1969, 1155 UNTS 331 [hereinafter Vienna Convention].

15 9 U.S.C. §§1–14 (2012). The FAA, which governs domestic and international arbitral agreements, was passed in 1925. It was amended in 1970 to incorporate the New York Convention. 9 U.S.C. §§201–08.

16 9 U.S.C. §10(a)(4).

17 BG Grp.PLC v. Republic of Arg., 715 F.Supp.2d 108 (D.D.C. 2010) [hereinafter BGGrp.I]; 764 F. Supp.2d 21 (D.D.C. 2011). In the first decision, the district court denied Argentina’s motion to vacate the arbitral award pursuant to §10(a)(4) of the FAA. In the second decision, the district court confirmed the award pursuant to §207 of the FAA and the New York Convention.

18 BG Grp. I, 715 F.Supp.2d at 116 (quoting Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc., 473 U.S. 614, 631 (1985)).

19 Id. at 121 (quoting Stolt-Nielsen S.A. v. AnimalFeeds Int’l Corp., 559 U.S. 662, 671 (2010)).

20 Id. at 122.

21 BG Grp. PLC v. Republic of Arg., 665 F.3d 1363 (D.C. Cir. 2012).

22 Id. at. 1371.

23 Id. at 1365–66.

24 Id. at 1373.

25 BG Grp. PLC v. Republic of Arg., 133 S.Ct. 2795 (2013) (mem.) (granting cert.).

26 134 S.Ct. 1198 (2014).

27 Roberts, Anthea, Clash of Paradigms: Actors and Analogies Shaping the Investment Treaty System, 107 AJIL 45 (2013)Google Scholar.

28 The conspicuous absence of references to the Vienna Convention was perhaps unsurprising, given that the Supreme Court routinely fails to reference it in its decisions on treaty interpretation. See, e.g., Medellín v. Texas, 552 U.S. 491 (2008). Although it did not expressly refer to the Vienna Convention, the Court did interpret the Treaty by reference to its text, structure, and context. See 134 S.Ct. at 1207, 1210 (majority op.), 1215 (Sotomayor, J., concurring in part), & 1216–17, 1219 –20 (Roberts, C.J., dissenting).

29 Argentina signed the Vienna Convention on May 23, 1969, and ratified it on December 5, 1972. The United Kingdom signed it on April 20, 1970, and ratified it on June 25, 1971. United Nations Treaty Collection, Chapter XXIII: Law of Treaties, at https://treaties.un.org.

30 Avena and Other Mexican Nationals (Mex. v. U.S.), 2004 ICJ Rep. 12, 48, para. 83 (Mar. 31); Golder v. United Kingdom, 18 Eur. Ct. H.R. (ser. A), para. 29 (1975).

31 Brief for the United States as Amicus Curiae in Support of Vacatur and Remand at 30 n.4, BG Grp. PLC v. Republic of Arg., 134 S.Ct. 1198 (2014) (No. 12-138), at http://www.americanbar.org/content/dam/aba/publications/supreme_court_preview/briefs-v2/12-138_v-r_usa.authcheckdam.pdf, available in U.S. S.Ct. Briefs LEXIS 3532 [hereinafter Brief for the U.S. on Vacatur].

32 See, e.g., Czech Republic v. Eur. Media Ventures SA, [2007] EWHC 2851, [14–15] (Comm.) (Eng.); Canada v. S.D. Myers, Inc., 2004 FC 38, [2004] F.C.R. 368, paras.24, 69(Can.); Czech Republic v. CME Czech Republic B. V., 42 ILM 919, 964–65 (2003) (Svea Ct. App. 2003) (Swed.).

33 Vienna Convention, supra note 14, Art. 31(3)(a), (b).

34 Gus Van Harten, Investment Treaty Arbitration and Public Law 4–5, 45, 49, 63, 100, 143–44 (2007).

35 134 S.Ct. at 1214 (Sotomayor, J., concurring in part) (quoting First Options of Chi., Inc. v. Kaplan, 514 U.S. 938, 945 (1995)).

36 ICSID Convention, supra note 2, Art. 52(1).

37 Promod Nair & Claudia Ludwig, ICSID Annulment Awards: the Fourth Generation?, Global Arb. Rev., Oct. 18, 2010, at 18 (by subscription); Christoph Schreuer, Three Generations of ICSID Annulment Proceedings, in Annulment of ICSID Awards 17 (Emmanuel Gaillard & Yas Banifatemi eds., 2004).

38 CMS Gas Transmission Co. v. Argentine Republic, ICSID Case No. ARB/01/8, Decision on Annulment, para. 49 (Sept. 25, 2007), at http://www.italaw.com.

39 Klöckner Industrie-Anlagen Gmbh v. Republic of Cameroon, ICSID Case No. ARB/81/2, Decision on Annulment, paras. 79, 81 (May 3, 1985), 1 ICSID Rev. 89 (1986); Amco Asia Corp. v. Republic of Indonesia, ICSID Case No. ARB/81/1, Decision on Annulment, paras. 93, 98, 103 (May 16, 1986), 25 ILM 1439 (1986).

40 See, e.g., Mar. Int’l Nominees Establishment v. Republic of Guinea, ICSID Case No. ARB/84/4, Decision on Partial Annulment, paras. 4.02, 5.04, 5.08, 6.55 (Dec. 22, 1989), 5 ICSID Rev. 95 (1990); Amco Asia Corp. v. Republic of Indonesia, ICSID Case No. ARB/81/1, Decision on Annulment of Award and of Supplemental Award, paras. 1.14, 1.17, 7.19, 7.28, 8.08 (Dec. 17, 1992), 9 ICSID Rep. 3 (2006).

41 See, e.g., Wena Hotels Ltd. v. Arab Republic of Egypt, ICSID Case No. ARB/98/4, Decision on Annulment (Jan. 28, 2002), 41 ILM 933 (2002); Compaña de Aguas del Aconquija S.A. v. Argentine Republic, ICSID Case No. ARB/97/3, Decision on Annulment (July 3, 2002), 19 ICSID Rev. 89 (2004) (reported by Susan L. Karamanian at 105 AJIL 553 (2011)).

42 CMS Gas Transmission Co., paras. 136, 158 –59.

43 See, e.g., Sempra Energy Int’l v. Argentine Republic, ICSID Case No. ARB/02/16, Decision on Annulment, paras. 121–25, 165 (June 29, 2010), at https://icsid.worldbank.org (reported by Bart M. J. Szewczyk at 105 AJIL 547 (2011)); Enron Creditors Recovery Corp. v. Argentine Republic, ICSID Case No. ARB/01/3, Decision on Annulment, para. 405 (July 30, 2010), at http://www.italaw.com.

44 Continental Casualty Corp. v. Argentine Republic, ICSID Case No. ARB/03/9, Decision on Partial Annulment, para. 90 (Sept. 16, 2011), at https://icsid.worldbank.org.

45 Uncitral Model Law, supra note 5, Art. 34(2)(a)(iii); FAA, 9 U.S.C. §10(a)(4) (2012).

46 United Mexican States v. Metal clad Corp., 2001 BCSC 664, paras. 70–72,76(Sup. Ct. B.C., Can.), at http://www.courts.gov.bc.ca (reported by William J. Dodge at 95 AJIL 910 (2001)).

47 See generally Brower, Charles H. II, Investor-State Disputes under NAFTA: the Empire Strikes Back, 40 Colum. J. Transnat’l L. 43 (2001)Google Scholar.

48 United Mexican States v. Cargill, Inc., 2011 ONCA 622, para. 42 (Ont. Ct. App., Can.) [hereinafter Cargill ], at http://www.ontariocourts.ca.

49 Id., para. 41.

50 Id., paras. 44, 47, 53.

51 Republic of Ecuador/Chevron Corp. (USA), Dist. Ct. The Hague, May 2, 2012, Nos. 386934/HA ZA 11-402, & 408948/HA ZA 11-2813, para. 4.5 (Neth.), at Oxford Reports: Int’l Investment Claims 539 (NE 2012).

52 Id., paras. 4.11–.12.

53 Id., para. 4.4.

54 Republic of Ecuador v. Occidental Exploration & Prod. Co., [2006] EWHC 345, [79] (Comm), [2006] 1 Lloyd’s Rep. 773 (High Ct.), aff’d, [2007] EWCA Civ 656 (Ct. App.).

55 In Ecuador v. Occidental, for instance, although it did not set aside the arbitral award, the court interpreted the jurisdictional provisions of the treaty itself, even disagreeing with the tribunal on some points, but taking care not to review the merits of Occidental’s claims. [2006] EWHC, supra note 54, at [79], [93]–[94].

56 BG Grp. I, 715 F.Supp.2d at 116 (quoting Mitsubishi Motors Corp., supra note 18, at 631).

57 Id. (quoting LaPrade v. Kidder, Peabody & Co., 94 F.Supp.2d 2, 4–5 (D.D.C. 2000)).

58 Gus Van Harten, Sovereign Choices and Sovereign Constraints: Judicial Restraint in Investment Treaty Arbitration 45–46(2013); Gus Van Harten, Arbitrator Behaviour in Asymmetrical Adjudication: An Empirical Study of Investment Treaty Arbitration, 50 Osgoode Hall L.J. 211, 214 –16, 237–40, 252 (2012).

59 ömer Dede v. Romania, Case No. ARB/10/22, Award, paras. 225, 262 (Sept. 5, 2013), at https://icsid.worldbank.org; Kilicç Ǐnşaat Ǐthalat Ǐhracat Sanayive Ticaret Anonim Şirketi v. Turkmenistan, ICSID Case No. ARB/10/1, Award, paras. 6.2.8–.9, 6.3.15, 6.6.1 (July 2, 2013), at http://www.italaw.com; Urbaser S.A. v. Argentine Republic, ICSID Case No. ARB/07/26, Decision on Jurisdiction, paras. 129–30 (Dec. 19, 2012), at http://www.italaw.com;DaimlerFin.Servs.AGv.ArgentineRepublic, ICSID Case No. ARB/05/1, Award, paras.193–94 (Aug. 22, 2012), at http://www.italaw.com; ICS Inspection & Control Servs. Ltd. (UK) v. Argentine Republic, PCA Case No. 2010-9, Award on Jurisdiction, at 90 n.301 (Feb. 10, 2012), at http://www.italaw.com (referring to the D.C. Circuit’s decision in BG Group).

60 Ingber, Rebecca, Interpretation Catalysts and Executive Branch Legal Decisionmaking, 38 Yale J. Int’l L. 359 (2013)Google Scholar.

61 Brief for the United States as Amicus Curiae at 14, 17–20, BG Grp. PLC v. Republic of Arg., 134 S.Ct. 1198 (2014) (No. 12-138), at http://sblog.s3.amazonaws.com/wp-content/uploads/2013/05/12-138-BG-Group.pdf, available in U.S. S. Ct. Briefs LEXIS 2339.

62 Brief for the U.S. on Vacatur, supra note 31, at 15–19.

63 Id. at 19–28.

64 Id. at 20 –25; Transcript of Oral Argument at 34, BG Grp. PLC v. Republic of Arg., 134 S.Ct. 1198 (2014) (No. 12-138), at http://www.supremecourt.gov/oral_arguments/argument_transcripts/12-138_c18e.pdf.

65 For example, Justice Breyer said, “[I]t seems to me this has sprung, full blown, from someone’s brain, but is not well embedded in any law. .. .” Justice Kagan said, “I don’t know what a consent-based objection is.” Transcript of Oral Argument, supra note 64, at 28, 33.

66 Id. at 32–33.

67 Cargill, supra note 48, paras. 75–84.