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CYIL 7 ȍ2016Ȏ NON ǧ PRECLUDEDMEASURES IN INTERNATIONAL INVESTMENT ARBITRATION
Its authors suggest investment tribunals draw on selected elements of the WTO
necessity doctrine when considering NPM clauses in BITs. It is notable that their
arguments for arbitrators’ acquiring the knack for not being spooked of applying
the WTO law necessity doctrine every time its use can be plausible are not without
reason.
59
Except for introducing an overview of the NPM clauses, this article endeavours
to present a brief account of the reasons why investment tribunals should consider
the WTO necessity doctrine as an apposite tool in all claims pertaining to the host
state reliance on the available BIT necessity doctrine in exigent circumstances. It will
make three intertwined observations.
First, due to the constant mergence between an international trade and investment
this article postulates that the cross-fertilization by means of downstream law production
between overlapping regimes of the international investment and trade should not be
forbidden, as the former is today everything but an anathema to the latter,
60
regardless
of their separate legal regulation.
61
After all, perhaps not only by pure coincidence
has it come about that in 2012 the US applied trade sanctions and trade measures as
a response to the Argentinian unwillingness to comply with ICSID awards when the
patience of US investors was wearing thin.
Second, the WTO jurisprudence is undeniably permeated with iterative similarities
with the investment arbitrations’ case law, while at the same time being rich enough
to serve as helpful, though not a domineering source of inspiration for arbitrators’
analysis of the host state’s application of the BIT necessity doctrine. Equally, unlike
ICSID tribunals’ interpretive attempts, the WTO three-stage-test of necessity is so
sophisticated that it would be simply jarring to assert that it may be of no value to
investment tribunals, unless the parties to the relevant BIT explicitly excluded its
possible application.
Finally, the reasonable application of the structured WTO necessity test by
investment tribunals could contribute to a further reduction of arbitrators’ discretion
and second guessing about the gravity of the host state’s crisis, when assessing all exigent
circumstances, in which the host state adopted necessary measures under the BIT
necessity doctrine. This article is divided into four sections, starting with an introduction.
The second section revisits the evolution of NPM clauses, while describing their structure
and distinguishing between two essential types of NPM provisions in BITs.
The following section examines an interpretation of NPM clauses and the treaty
based necessity in the international investment arbitration. After providing the
reader with a brief recap of the Argentinean crisis, the article firstly incorporates
a space efficient analysis of the arbitral award in the
LG&E
case. In particular, it will
59
HENCKELS, C., MITCHELL, A. D.: Variations on a Theme,
op. cit
., p. 93.
60
REINISCH, A.: Chapter 6: Necessity in Investment Arbitration,
op. cit.
, p. 156.
61
PUIG, S.: The Merging of International Trade and Investment Law,
op. cit.
, p. 8.