Govts gather in Jakarta to discuss investment arbitration
Governments gather in Jakarta to discuss alternatives and options for reform of investment arbitration
Jakarta, November 4 2013 — Delegates from over 45 developing countries are gathering this week at the Seventh Annual Forum for Developing Country Investment Negotiators to discuss the challenges they face in dealing with investment arbitration. The annual event is taking place in Jakarta from November 4-6, 2013.
This year’s event is co-hosted by Indonesia’s Ministry of Foreign Affairs, the International Institute for Sustainable Development and the South Centre. It is expected to draw over 90 participants from Africa, Asia Pacific, Latin America and the Caribbean.
Several regional and international organizations are also attending, including the United Nations Conference on Trade and Development, the Association of Southeast Asian Nations, the Commonwealth Secretariat, the Office of the Chief Trade Adviser for Pacific Island Countries, the UN Economic Development and Globalization Division, and the Caribbean Community and Common Market.
Countries face an increasing number of arbitration claims initiated by foreign investors under international investment treaties. In 2012 alone, at least 58 investment treaty-based arbitrations were filed—the largest number of known cases in a single year.
These often involve claims for tens, if not hundreds, of millions of dollars in damages. Last year, Ecuador was ordered to pay a record US$1.77 billion in damages to an American oil company in a single arbitration decision. The arbitrations also frequently centre on sensitive areas of public policy, including environmental protection in mining and other sectors, public health, and taxation policies.
“Over the past years, many systemic problems in investment arbitration have come to light, including the lack of transparency, the lack of predictability, the lack of arbitrator independence, and accountability of the system more generally,” said Nathalie Bernasconi, program leader and senior international lawyer for IISD’s Investment and Sustainable Development Program.
The focus of this year’s forum is based on the desire expressed by last year’s participants to have an in-depth discussion of current challenges faced by countries and a sharing of experiences regarding investor-state dispute settlement.
“The forum provides a much-needed space for participants to discuss not only reform of existing arbitration rules and procedures, but also alternatives for resolving disputes arising between foreign investors and states,” said Bernasconi.
For more information about IISD’s program as well as previous forums, please visit: http://www.iisd.org/investment/.