CYIL 2014

372

ZUZANA JAHODNÍKOVÁ

–

MILOŠ OLÍK

CYIL 5 ȍ2014Ȏ

the words of the

Holiday Inns v. Morocco

Tribunal: “international proceedings in

principle have primacy over purely internal proceedings”. This occurred when the

Tribunal rejected staying the proceedings until the Moroccan courts rendered their

judgement by using the argument that such a stay in proceedings would, “endanger

the rule that international proceedings prevail over internal proceedings”.

Although every tribunal has to adopt a vigilant advance towards each and

every court intervention, international arbitration, inclusive of investment dispute

litigation, has to assume that the legal nature of the proceedings habitually creates a

favourable and indispensable climate for the involvement of a national court. In this

fashion, for example, the public gains a valuable tool which will help to monitor the

course of the arbitral proceedings and perhaps also the outcome of the proceedings.

An especially noteworthy fact is that in investment arbitration provisions have

to be made not only as to the margin of appreciation exercised by the courts at the

seat of arbitration but also to that of the domestic courts of the state taking part in

the pending arbitration.

There are at least two salient research areas which could

be evaluated when assessing state conduct and parallel proceedings. The first area is

the level of state interference in international commercial arbitration proceedings

between two private parties litigating a dispute. One approach has been to persuade

the tribunal, designated under the original arbitration agreement, to continue with

the arbitration despite governmental intervention and deliver an award which could

then be enforced in a so-called ‘friendly’ country. A number of tribunals have followed

this course, sometimes relocating the arbitration hearings to a neutral jurisdiction to

avoid harassment and intimidation by the State party in the seat of arbitration.

The

second is the possibility of parallel proceedings occurring in investor state arbitrations

approach to arbitration, which has not been generally accepted in common law countries although

there has been some recognition in the laws of European countries. See: R. Garnett, “National Court

Intervention in Arbitration as an Investment Treaty Claim”,

International and Comparative Law

Quarterly

, Vol. 60 (April 2011), p. 486. For information on the English view on domestic intervention

in international arbitration, see: N. Maitra: “

Domestic Court Intervention in International Arbitration.

The English View

.”,

Journal of International Arbitration

23(3): 239-248, 2006.

Holiday Inns S.A. and others v. Morocco

(ICSID Case No. ARB/72/1), Award unpublished. P. Lalive,

“The First “World Bank” Arbitration (

Holiday Inns v. Morocco

) - Some Legal Problems, 51

BYIL

123 (1980), p. 160

as cited in:

Ch. Schreuer, L. Malintoppi, A. Reinisch and A. Sinclair,

The ICSID

Convention: A Commentary (A Commentary on the Convention on the Settlement of Investment Disputes

between States and Nationals of Other States)

, (Cambridge University Press, 2nd ed., 2009), pp. 364-365.

In terms of the law applicable at the seat of arbitration and the national court’s supervision over arbitral

proceedings, the choice of seat or place of arbitrations becomes one of the most critical decisions to be

made. Parties to arbitration face a variety of options in this regard and the selection process has become

a thorough analysis which includes the assessment of the national arbitration law or equally the practice

of courts at the seat.

R. Garnett,

supra

note 26. It needs to be noted that States are in favour mainly of retaining disputes

before or under supervision of their national courts. This is evidently the case for reasons such as the

prospect of court advantage, non-existence of a language barrier, knowledge of the local law and a

reduction in expenses. However when looking at the possibility of excessive national court intervention,

investors will try to shield themselves against the involvement of a host State’s national court.