CYIL Vol. 7, 2016

CYIL 7 ȍ2016Ȏ NON ǧ PRECLUDEDMEASURES IN INTERNATIONAL INVESTMENT ARBITRATION On the other hand, trying to prove that BITs have not absorbed the concepts based on the customary international law could have been a Sisyphean task. 17 Within the context of BITs, Martin 18 succinctly points out: “Again, the lex specialis is not a second- class source of law but a set of rules, specifically applicable to investment disputes, beyond the influence of customary law.” Therefore, the NPM clause serves as an additional layer of protection for the parties to the BIT, 19 being substantially and formally different from the CIL necessity practically in everything, whether it is its variably positive undertone, the way of drafting, or an overall legal philosophy carved into it by the BIT’s negotiators. Nonetheless, it is imperative that a right of the parties to the BIT to invoke the CIL necessity be maintained – there is absolutely no reason, why the customary international law should not be embraced, when appropriate on grounds of its efficiency. 20 In particular, the very fact that the CIL necessity used to be relied on in several ICSID arbitrations instead of applying the relevant NPM clause on no account means that they compete with each other. 21 Thus it is highly important to stress that the CIL necessity is no replacement for the NPM clause, and the same may be applied vice versa. Given that concepts of CIL necessity and treaty based necessity expressed in the NPM clause are like chalk and cheese, their mutual intercourse and interpretation cannot be melted conveniently into one homogenous substance, nor can its application be standardised. Indeed, NPM clauses as lex specialis not only differ from the CIL necessity defence, but, even more, they are separated from it by an imaginary fence line, built by their content and theoretical reasonableness, as well as by their scope of applicability and the basic source of legal authority, which is a treaty law, expressed in the BIT. 22 Nevertheless, in spite of all existing differences, an application of the NPM clause turned out to be improperly embellished with that of the CIL necessity in five cases, decided in ICSID arbitration against Argentina, 23 regardless of the NPM clauses’ character, different from typical defences in the customary international law. Before 17 VAN ZIMMEREN, MCRAE E.: Chapter 35: Countermeasures and Investment Arbitration in KINNEAR,.M., FISCHER et al. (ed.)/: Building International Investment Law , op. cit ., p. 503. 18 MARTIN, A.: Investment Disputes after Argentina’s Economic Crisis, op. cit ., p. 55. 19 Equally DESIERTO, D.A.: Necessity and Supplementary Means of Interpretation, op. cit ., p. 918. 20 Accordingly REINISCH, A.: Chapter 6: Necessity in Investment Arbitration. In: Netherlands Yearbook of International Law , 2010, Vol. 41, pp. 137-158. 21 See SYKES, A.: Economic “Necessity” in International Law, The American Journal of International Law , 2015, Vol. 109, No. 2, pp. 296-323. 22 BURKE-WHITEW., VON STADEN A.: Investment Protection in Extraordinary Times, op. cit ., p. 322. 23 CMS Gas Transmission Company v. Argentina, Award, ICSID Case No. ARB/01/8, 12 May 2005, Enron Creditors Recovery, L. P. v. Argentina, Award, ICSID Case No. ARB/01/3, 22 May 2007, LG&E Energy Corp and others v. Argentina, Award, ICSID Case No. ARB/02/1, 25 July 2007, Sempra Energy International v. Argentina, Award, ICSID Case No. ARB/02/16, September 28, 2007, Continental Casualty Company v. Argentina, Award, ICSID Case No. ARB/03/9, 5 September 2008.

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