I. INTRODUCTION
The sui generis nature of investment treaty arbitration has received widespread attention in recent years.Footnote 1 It is aptly described as ‘hybrid’,Footnote 2 because while the jurisdiction of tribunals and the standards of protection are based on investment treaties between States, it incorporates or uses the procedural rules of international commercial arbitration.Footnote 3 The incorporation or use of international commercial arbitration rules is evident when we examine the two major types of investment treaty arbitration, ie NAFTA Chapter 11 arbitration and ICSID arbitration. NAFTA Chapter 11 establishes the investment dispute settlement mechanism including arbitration, under which the investor may submit a claim to arbitration on the ground, inter alia, that the host State has breached its investment protection obligations.Footnote 4 Article 1201 NAFTA gives the investor three options for arbitration rules: (a) the ICSID Convention;Footnote 5 (b) the Additional Facility Rules of ICSID;Footnote 6 and (c) the UNCITRAL Arbitration Rules.Footnote 7 However, (a) is not an option for NAFTA investor-State disputes, because only the US has ratified the ICSID Convention among the NAFTA parties. Option (b) is available only where ‘either the State party to the dispute or the State whose national is a party to the dispute is a Contracting State’,Footnote 8 ie the dispute involves the US, but even in such cases the investor often does not choose this option (see, Methanex Corporation v United States in section II(A)(1)). Therefore, in NAFTA arbitration, the UNCITRAL Arbitration Rules ((c)), which are designed for the resolution of international commercial disputes between private parties, are most frequently used. ICSID arbitration is invoked where: (a) the parties consent to their dispute being submitted to ICSID arbitration; (b) the dispute is between a contracting State and a national of another contracting State to the ICSID Convention; and (c) where the dispute is a legal dispute arising directly out of an investment. The host States' consent to arbitration is most commonly given in investment treaties, and in most cases the investor bases its claim on the host State's breach of investment treaty obligations. ICSID arbitration is governed by the ICSID Convention, which is complemented by Regulations and Rules adopted by the Administrative Council of the ICSID, including the Rules of Procedure for Arbitration Rules (‘ICSID Arbitration Rules’).Footnote 9 Although the ICSID Convention and the ICSID Arbitration Rules contain several provisions that reflect the unique ‘public–private’ nature of investor–State disputes,Footnote 10 the structure and key contents (eg that the parties control the composition of the tribunal and the applicable law) of the ICSID Rules are modelled on rules of international commercial arbitration such as the UNCITRAL Arbitration Rules and ICC Rules.Footnote 11 These international commercial arbitration rules are also used in non-ICSID arbitration other than NAFTA.Footnote 12 Therefore, investment treaty arbitration relies on the procedural design of international commercial arbitration,Footnote 13 ‘[d]espite clear differences between classical commercial arbitration and investment arbitration’.Footnote 14
The significant consequences of the incorporation of international commercial arbitration rules in investment treaty arbitration are twofold. First, investment treaty arbitral awards are enforceable like many awards of international commercial arbitration, by virtue of either the ICSID Convention or the 1958 New York Convention (‘NYC’).Footnote 15 Although the strong enforcement mechanism for investment treaty arbitration—together with the lack of domestic review and the absence of an appeal tribunal—is a matter of controversy,Footnote 16 it is outside the scope of this article. This article deals with another, equally important, consequence of the incorporation of the procedural rules of international commercial arbitration, namely, that investment treaty arbitration proceedings are private.
The privacy and confidentiality of the proceedings are fundamental concepts of international commercial arbitration. Yet whether or not these should also apply to investment treaty arbitration has been controversial. The controversy stems from the very nature of investment treaty arbitration. In substance, investment treaty arbitration has a public character, and it is argued that these public features distinguish it from international commercial arbitration. One such public feature is that the substantive rights and obligations at issue are set by treaties, and general international law is applicable to investment treaty arbitration.Footnote 17 In other words, investment treaty arbitration is governed by public international law, as well as the law of the host State. As a result, the pronouncements of law made by arbitral tribunals have ramifications in the development of public international law.Footnote 18 Another important public feature of investment treaty arbitration is the effects of arbitral awards on the general public. As investor-State disputes have evolved from the ‘traditional’ expropriation cases (ie governmental interference with the physical assets of the foreign investors) to conflicts arising out of regulatory interferences with various aspects of the investment,Footnote 19 it is increasingly recognized that they should be characterized as ‘regulatory disputes within the public law sphere’.Footnote 20 Van Harten observes that the system of investment treaty arbitration resembles domestic systems of constitutional or administrative law, as it ‘reviews and disciplines legislators, judges and other public officials in order to protect the business’.Footnote 21 It should be emphasized that governmental regulations and measures challenged by investors are based on public policy, and therefore the issues raised in such disputes concern not only the parties to the dispute but also the public. Even potentially legitimate measures of the host State such as environmental regulations are not free from challenge. For example, one of the issues at stake in Methanex was the extent to which the government may exercise its sovereign right to ban a chemical that is (potentially) harmful to public health and the environment. In such circumstances, the decisions and pronouncements of tribunals will ‘have implications that go far beyond commercial impacts to such public policy objectives as the protection of the environment and public health and safety’.Footnote 22
In sum, between investment treaty arbitration and international commercial arbitration there is a substantive difference on the one hand, and a procedural similarity on the other. This gives rise to the question whether the procedural rules designed for the latter actually fit the former, and, more fundamentally, whether investment treaty arbitration is the proper forum to deal with such public issues.Footnote 23
Against this background, a significant change concerning third party participation has taken place in investment treaty arbitration.Footnote 24 Indeed, the recognition of the ‘need to harmonize trade and environmental objectives and to encourage public discussion and debate regarding these issues’ has led investment treaty arbitration to depart from rules and practices that govern international commercial arbitration.Footnote 25 Following several decisions of NAFTA and ICSID tribunals that acknowledged the power of the tribunal to allow written amicus curiae (‘friend of the court’)Footnote 26 submissions by third parties (non-disputing parties), the ICSID Arbitration Rules were amended to authorize tribunals to do so. This opens the possibility that civil society actors, in particular non-governmental organizations (‘NGOs’), have a role to play in investment treaty arbitration. This change may reflect the trend towards greater NGO participation in the making of international policy and law.Footnote 27 It may also follow the trend in many other international courts and tribunals (an exception being the International Court of Justice (‘ICJ’)) to allow the participation of NGOs in the proceedings of pending cases.Footnote 28
This article examines this change concerning amicus curiae submissions. It starts by examining the relevant case law and practice of both the NAFTA and ICSID arbitration regimes (section II). It then addresses the concerns raised over this change, and demonstrates that these concerns are either misplaced or avoidable (section III). This is followed by an examination of the purpose of receiving amicus curiae submissions and the benefits amicus curiae briefs may bring to the dispute settlement process (section IV). Having established the appropriateness of this ‘framework’ change, it then considers whether the effect of the change is more apparent than real. Practices concerning the use of amicus curiae submissions in investment treaty tribunals will be compared with those in the WTO adjudicatory bodies (section V). Case law of the latter is particularly pertinent in this context, not only because it has a longer history of receiving amicus curiae submissions than investment treaty arbitration, but also because international trade law and investment law share the same concern over the relationship between economic interests and other public interests (such as environmental protection). It concludes by stressing the need for effective use of amicus curiae submissions (section VI).
II. PROCEDURAL DEVELOPMENT IN INVESTMENT TREATY ARBITRATION
The development of third party participation in the arbitral process, in particular, the submissions of amicus curiae briefs, has occurred in both NAFTA and ICSID arbitrations. As indicated in section I, the important difference between these two systems of arbitration for the purpose of this article is the rules governing the arbitration proceedings, ie while ICSID arbitration is governed by the ICSID Convention and ICSID Arbitration Rules, the procedural rules most frequently used in NAFTA arbitration are the UNCITRAL Arbitration Rules. This section outlines chronologically the procedural developments concerning amicus curiae briefs in NAFTA and ICSID arbitration respectively.
A. NAFTA arbitration
1. Methanex Corporation v United States
This is the first investor-State arbitration case where the tribunal held that it had authority to accept written amicus curiae submissions. The dispute arose out of a Californian ban of a gasoline additive called MTBE. Methanex was the largest producer of methanol, which is the essential oxygenating element of MTBE. The case was brought before an UNCITRAL arbitration tribunal under Chapter 11 of the NAFTA. During the proceedings, the International Institute for Sustainable Development (‘IISD’) and the Communities for a Better Environment/Earth Island Institute (joint petition: collectively, ‘Earth-Justice’) submitted petitions requesting permission to (a) make oral and written amicus curiae submissions (IISD and Earth-Justice); (b) participate in the arbitration proceeding as amici curiae (Earth-Justice); (c) attend the hearings (IISD and Earth-Justice); (d) have the opportunity to review memorials of the parties and any other submissions or orders in the proceedings (Earth-Justice); and (e) have observer status at oral hearings (IISD). In response, the tribunal issued the Decision on Authority to Accept Amicus Submissions in January 2001.Footnote 29
The tribunal first noted that the provisions in the UNCITRAL Arbitration Rules and NAFTA Chapter 11 neither expressly admit nor deny the tribunal's power to accept amicus submissions.Footnote 30 Therefore, the first question was whether the tribunal's acceptance of amicus submissions fell within the general scope of article 15(1) of the UNCITRAL Arbitration Rules. The tribunal answered in the affirmative, but since it considered that ‘it is premature now for the Tribunal finally to decide the question (of whether to allow amicus written submissions) at this relatively early stage’, declined to articulate detailed criteria for such submission. It did, however, indicate that its power under article 15(1) is limited to ‘procedural matters’ only, and that such participation is at the discretion of the tribunal.Footnote 31 The tribunal made it clear that the power is not to accord third parties any substantive rights. The tribunal then held that it could be appropriate to allow written amicus submissions from the IISD and Earth-Justice, but it would make a final decision at a later stage of the proceedings.
In reaching this conclusion, the tribunal made specific references to the case law of the Iran–US Claims Tribunal and the WTO Appellate Body that had accepted written amicus curiae submissions.Footnote 32 It also recognized the public nature of the case, stating: ‘there is an undoubtedly public interest in this arbitration. The substantive issues extend far beyond those raised by the usual transnational arbitration between commercial parties…[t]here is also a broader argument… (the) arbitral process could benefit from being perceived as more open or transparent; or conversely be harmed if seen as unduly secretive. In this regard, the Tribunal's willingness to receive amicus submissions might support the process in general and this arbitration in particular, whereas a blanket refusal could do positive harm’.Footnote 33
On the other hand, the tribunal rejected all other requests made by the IISD and/or Earth-Justice. The tribunal held that it did not have the authority to allow amici to attend oral hearings on the ground that article 25(4) of the UNCITRAL Arbitration Rules requires hearings to be held in camera unless both parties consent otherwise, and there was no such consent in this case.Footnote 34 With regard to the request for access to the materialsFootnote 35 of the case, the tribunal accepted the possibility of disclosing the materials, stating that the confidentiality of the arbitration is to be distinguished from the privacy of oral hearings; and that there are conflicting views on the question of whether the ‘in camera rule’ includes the duty of confidentiality in regard to such materials.Footnote 36 Nevertheless, it rejected the request on the ground that in this case the disputing parties had agreed on the confidentiality of the proceedings by an agreement made in earlier proceedings.Footnote 37 As the amici had no rights in the proceedings, there was no basis on which they could override this order on confidentiality.Footnote 38
In 2003, while the Methanex case was still in progress, the NAFTA Free Trade Commission (‘FTC’) issued a statement on third party participation in NAFTA Chapter 11 proceedings (‘FTC Statement on Third Party Participation’).Footnote 39 The statement explicitly acknowledges that non-disputing parties may apply for leave to file a submission. It also establishes guidelines for the acceptance of such submissions. In 2004, in accordance with the procedures set out in the FTC Statement on Third Party Participation, the Methanex tribunal accepted the submissions made by the IISD (‘IISD submission’) and Earth-Justice (made on behalf of Bluewater Network, Communities for a Better Environment and Center for International Environmental Law (‘Bluewater submission’)).Footnote 40
2. United Parcel Service v Canada
In this case, the claimant challenged several Canadian measures concerning its postal services market. The Canadian Union of Postal Workers (‘CUPE’) and the Council of Canadians made an amicus request to the tribunal for, inter alia, (a) standing as parties to certain proceedings; (b) the right to intervene as amicus curiae in the proceedings; and (c) the disclosure of the materials of the case. The tribunal took the same approach as the Methanex tribunal: it held that the power of the tribunal to receive amicus curiae submissions is within the scope of article 15(1) of the UNCITRAL Arbitration Rules, while emphasising that ‘it is a matter of its power rather than of third party right’.Footnote 41 On the other hand, the tribunal held that it may not permit third parties to attend the hearings on the ground that the ‘in camera rule’ (article 25(4) of the UNCITRAL Arbitration Rules) prevents it to do so in the absence of both parties agreeing.Footnote 42 Nor did it accept the ‘general’ release of the materials of the case on the ground that such a release is to be decided case by case through an agreement or confidentiality order, or ‘otherwise lawfully’.Footnote 43 Accordingly, in 2005 the UPS tribunal received the amicus curiae briefs from CUPE and the Council of Canadians (joint submission) and the US Chamber of Commerce.Footnote 44
3. Glamis Gold Ltd v United States
This dispute concerned Glamis's mining project in the California desert. Glamis argued that regulatory measures imposed by the federal government and the State of California amounted to expropriation and were in breach of the obligation to provide a fair and equitable standard of treatment. In particular, Glamis challenged legislation and regulations adopted by California that required, inter alia, backfilling of all open pits and recontouring of the land after cessation of metallic mining activities. The US argued that these measures were intended to: (a) ensure that mined lands are returned to a usable condition and pose no danger to public health and safety; and (b) provide protection to Native American sacred sites. Amicus curiae submissions were filed in this case by the Quechan Indian Nation, Friends of the Earth Canada/Friends of the Earth United States (joint submission), the National Mining Association, and the Sierra Club/Earthworks (joint submission). These submissions were accepted by the tribunal as appropriate in accordance with the principles stated in the FTC Statement.Footnote 45 The power of the Tribunal to accept amicus curiae submissions was not questioned in subsequent procedural orders because the proceedings began after the release of the FTC Statement on Third Party Participation.Footnote 46
B. ICSID Arbitration
1. Aguas del Tunari, SA v Republic of Bolivia Footnote 47
The dispute arose out of Bolivia's privatization of water and sewage services, the concession for which was awarded to the claimant. The claimant commenced the project, but soon faced strong opposition and protests by citizens and eventually abandoned the project. The claimant then filed the claim arguing, inter alia, that the Bolivian government breached various provisions of the Netherlands/Bolivia BIT through various acts and omissions including the rescission of the concession. In August 2002, several environmental NGOs and individuals filed petitions for status as amicus curiae.Footnote 48 Their requests included: (a) standing to participate as parties; (b) submission of amicus curiae briefs; (c) attendance at all hearings; and (d) public disclosure of the materials of the case. However, the tribunal rejected all of these requests. In a letter from the president of the tribunal,Footnote 49 he stated that the tribunal unanimously decided that the requests were ‘beyond the power or the authority of the Tribunal to grant’. According to the tribunal, ‘it is manifestly clear’ that it does not have the power to grant the request for access to hearings and the documents of the proceedings without the agreement of the parties. As for the request for the amicus curiae submission, the arbitrators were of the view that ‘there is not at present a need to call witnesses or seek supplementary non-party submissions at the jurisdictional phase of its work’. The proceedings of this case were discontinued in March 2006 at the request of both parties, following the settlement of the dispute.
2. Suez, Sociedad General de Aguas de Barcelona SA, and Vivendi Universal SA v Argentine (Suez/Vivendi case, first petition)
This is the first case in which the tribunal acknowledged that it has the power to accept amicus curiae submissions under the ICSID Convention. The dispute related to the privatization of the public service of water provision. The claimants argued that certain measures the Argentine government adopted in response to Argentina's economic and financial crisis injured their investments. Five NGOs filed a ‘Petition for Transparency and Participation as Amicus Curiae’, in which they made several requests to the tribunal including: (a) access to the hearings; (b) an opportunity to submit amicus curiae briefs; and (c) unrestricted access to the materials of the case.
The tribunal issued an order on 19 May 2005 (‘Suez/Vivendi First Order on Amici’)Footnote 50 and concluded that it had the power to accept amicus curiae submissions under article 44 of the ICSID Convention.Footnote 51 The tribunal explained the virtue of accepting amicus curiae submissions as follows:
The acceptance of amicus submissions would have the additional desirable consequence of increasing the transparency of investor-state arbitration. Public acceptance of the legitimacy of international arbitral processes, particularly when they involve States and matters of public interest, is strengthened by increased openness and increased knowledge as to how these processes function...[t]hrough the participation of appropriate representatives of civil society in appropriate cases, the public will gain increased understanding of ICSID processes.Footnote 52
The tribunal then set forth three criteria for assessing whether to accept amicus curiae submissions: (a) the appropriateness of the subject matter of the case (that the case involves issues of public interest and has the potential to affect persons beyond those immediately involved as parties in the case); (b) the suitability of a given non-party to act as amicus curiae in the case (that the petitioners have the expertise, experience, and independence to be of assistance); and (c) the procedure by which the amicus submission is made and considered (that the procedure enables an approved amicus curiae to present its views and at the same time to protect the substantive and procedural rights of the parties).Footnote 53 It should be noted that the tribunal also confirmed that the acceptance of amicus submissions is a procedural question that does not affect disputing parties' substantive rights.Footnote 54
On the other hand, the tribunal did not allow the petitioners to attend the hearings on the ground that the consent by both parties to such an attendance had not been obtained as required by Rule 32(2) of the ICSID Arbitration Rules.Footnote 55 The tribunal deferred decision on the issue of access to arbitration documents until such time as an appropriate third party had been granted leave to make an amicus submission. As will be indicated below (in subsection 6), the tribunal, in its second order on amici issued on 12 February 2007, accepted a joint amicus submission by the five NGOs, but did not assess the issue of access to documents.
4. Suez, Sociedad General de Aguas de Barcelona SA, and InterAguas Servicios Integrales del Agua SA v Argentina (Suez/InterAguas case)
The tribunal in this case comprised the same arbitrators as the Suez/Vivendi tribunal. It is therefore not surprising that the tribunal decided to apply the principles of the Suez/Vivendi First Order on Amici to the case and reached a very similar conclusion in its order on 17 March 2006.Footnote 56 The tribunal noted that matters of public interest in the sense that the legality of governmental measures and the responsibility of a State under international law are at stake are common in ‘virtually all cases of investment treaty arbitration under ICSID jurisdiction’.Footnote 57 The tribunal then stated that this case has particular public interest because it is concerned with the water distribution and sewage systems which provide basic public services, and therefore a variety of public and international law questions, including human rights considerations, may be raised.Footnote 58
In this order, however, the tribunal declined to grant the petitioners permission to make amicus submissions. The tribunal applied the three criteria articulated in the Suez/Vivendi First Order on Amici to the petition, and concluded that the petitioners have not provided sufficient specific information and reasons to be admitted as amici curiae in this case.Footnote 59 At the same time, however, the tribunal left the door open for them to provide the tribunal with further information in order to do so, by stating that the tribunal has decided to ‘grant an opportunity to Petitioners to apply for leave to make amicus curiae submission if and when the Petitioners provide the Tribunal with convincing information and reasons that they qualify as amicus curiae’.Footnote 60 As of the end of March 2010, this case is still pending and second amicus curiae submissions have not been made.
5. Amendment of the ICSID Arbitration Rules
Following these three inconsistent decisions,Footnote 61 the ICSID Arbitration Rules were amended in April 2006.Footnote 62 Among others, Rule 37 (Visits and Inquiries) was amended so as to make it clear that the tribunal has the discretion to allow written submissions from non-disputing parties, although certain considerations specified by the rule will have to be taken into account in the decision making. That is, the following second paragraph was added to Rule 37:
(2) After consulting both parties, the Tribunal may allow a person or entity that is not a party to the dispute (in this Rule called the ‘non-disputing party’) to file a written submission with the Tribunal regarding a matter within the scope of the dispute. In determining whether to allow such a filing, the Tribunal shall consider, among other things, the extent to which:
(a) the non-disputing party submission would assist the Tribunal in the determination of a factual or legal issue related to the proceeding by bringing a perspective, particular knowledge or insight that is different from that of the disputing parties;
(b) the non-disputing party submission would address a matter within the scope of the dispute;
(c) the non-disputing party has a significant interest in the proceeding.
The Tribunal shall ensure that the non-disputing party submission does not disrupt the proceeding or unduly burden or unfairly prejudice either party, and that both parties are given an opportunity to present their observations on the non-disputing party submission.
Rule 32 (Oral Procedure) was also modified. Under the new paragraph 2, access to hearings to third non-disputing parties may be granted by an ICSID tribunal, unless there is an express objection from either party. Yet, as has been pointed out, the change introduced by this modification from the previous wording (‘[t]he Tribunal shall decide, with the consent of the parties’) is actually slight.Footnote 63
6. Suez, Sociedad General de Aguas de Barcelona S.A., and Vivendi Universal SA v Argentine (second petition)
In December 2006, five NGOs made a joint amicus curiae submission to the tribunal, requesting the opportunity to make written amicus curiae submissions and unrestricted access to the materials of the case. The tribunal issued its second order on amici on 12 February 2007 (‘Suez/Vivendi Second Order on Amici’).Footnote 64
As to the request for the written amicus curiae submission, the tribunal first noted that the amended ICSID Arbitration Rules themselves do not apply to this case.Footnote 65 Nevertheless, it held that the amended Rule 37 is in accord with the three criteria set out in the Suez/Vivendi First Order on Amici. The tribunal then decided that the petition made by these NGOs met these criteria, and concluded that they may file an amicus curiae submission in accordance with the procedure specified in the Order. As to the request for access to arbitration documents, the tribunal first made it clear that the revised Rule 37(2) does not deal with the amicus curiae's access to the record and thus provides no guidance. Then the tribunal held that: ‘(as) a general proposition, an amicus curiae must have sufficient information on the subject matter of the dispute to provide “perspectives, expertise and arguments” which are pertinent and thus likely to be of assistance to the Tribunal. Otherwise the entire exercise serves no purpose’.Footnote 66 Nevertheless, the tribunal found that in this particular case there is no need to decide on the general question of a non-party's access to the record, because the petitioners have sufficient information even without being granted access to the arbitration record.
7. Biwater Gauff Ltd v United Republic of Tanzania
The dispute in this case arose out of the cancellation of the contract between the Tanzanian government and the claimant concerning the service of water supply. In March 2006, five NGOs including the IISD and CIEL (‘Petitioners’) filed a petition for amicus curiae status, and the tribunal issued Procedural Order No. 5 in response.Footnote 67 Not surprisingly, the tribunal held that it would accept written amicus curiae submissions. The tribunal noted that the new ICSID Arbitration Rules do not provide for a general amicus curiae ‘status’, but two specific and delimited types of participation by non-parties, ie (a) the filing of a written submission (Rule 37(2)) and (b) attendance at hearings (Rule 32(2)).Footnote 68 This is in line with the decisions of earlier tribunals that amicus curiae submissions do not give third parties any rights, status or privileges in the proceedings.
Like other decisions examined so far, the tribunal rejected the request for access to the materials of the case, but it provided more detailed reasons for the refusal. This decision needs to be considered together with another order on confidentiality (‘Procedural Order No.3’) issued prior to the Procedural Order No. 5,Footnote 69 in response to Biwater's request for provisional measures concerning confidentiality.Footnote 70 In Procedural Order No. 3, having noted that there is no general rule on confidentiality in the ICSID Arbitration Rules, the tribunal took the approach of balancing the two competing interests: the need for greater transparency and ‘procedural integrity’.Footnote 71 It identified six types of materials of the proceedings: awards; decisions, orders and directions of the tribunal; minutes or records of hearings; documents disclosed in the proceedings; pleadings/written memorials; and correspondence between the parties and/or the arbitral tribunal,Footnote 72 and ordered provisional measures as to the latter four.
In Procedural Order No. 5, the tribunal provided two reasons for the refusal of the request for access to the materials of the case. First, it was explained that ‘the broad policy issues on which the Petitioners are especially qualified are ones which are in the public domain,Footnote 73 and about which each Petitioner is already very well acquainted’, and ‘[n]one of these types of issue ought to require—at least for the time being—disclosure of documents from the arbitration’.Footnote 74 Secondly, the tribunal referred to Procedural Order No. 3 and stated that the concerns with respect to procedural integrity identified in that order remain for the time being, and the ‘safeguards now in place would be effectively swept away if access was now given to all categories of documents’.Footnote 75 At the same time, however, the tribunal left the door open to revisiting the issue of confidentiality, namely, it stated that once the substantive hearing scheduled in April 2007 is concluded and if the concerns with respect to procedural integrity altered, there may then be a possibility of such a disclosure of documents.Footnote 76 By letter dated 8 February 2007, Biwater requested that Procedural Order No. 3 be applied to the Petitioners. The tribunal issued its decision on this request on 7 March 2007, in which it concluded that it ‘did not see any reason to restrict the Petitioners' liberty in relation to the briefs to be submitted on or before 2 April 2007’.Footnote 77 In reaching this conclusion, the tribunal took into account, in particular, (a) the fact that the dispute was a very public and widely reported one; (b) that the Procedural Order No. 5 did not allow the disclosure of documents to the Petitioners; and (c) consequently their submissions ‘would not refer to the documents exchanged in the arbitration (except if they had previously been made available to the public)’.Footnote 78
The Petitioners filed their joint amicus curiae submission on 26 March 2007.Footnote 79
C. Summary
These NAFTA/UNCITRAL and ICSID cases show fairly consistent attitudes by investment treaty arbitration tribunals. First, all the tribunals except for Aguas del Tunari acknowledged the power of the tribunals to accept written amicus curiae submissions. This was so even before the release of the FTC statement on third party participation and the amendment of the ICSID Arbitration Rules. Yet at the same time, they all agreed on the point that the acceptance of amicus curiae submissions is a matter of discretion and the power of tribunals to accept such submissions is limited to procedural matters: in other words, third parties do not have any rights or privileges in the arbitral proceedings.
Secondly, without exception, the tribunals do not allow attendance at the hearings and oral amicus curiae submissions. The legislative ground for this refusal appears to be clear. Under article 25(4) of the UNCITRAL Arbitration Rules and Rule 32 of the ICSID Arbitration Rules (both before and after the 2006 amendment), a tribunal may not allow third parties to attend the hearings unless both parties to the dispute consent. All of these cases lacked such consent.
Thirdly, again without exception, they do not grant access to the materials of the proceedings. The legislative ground for this refusal of disclosure is less clearFootnote 80 and the reasons vary between cases: the existence of the previous agreement between the disputing parties (Methanex); the existence of the previous order of the same tribunal on confidentiality (Biwater); to protect the procedural integrity (Biwater); that the release of each material is not to be decided generally but case by case (UPS); that the petitioners have enough information to make arguments on the policy issues (Suez/Vivendi (second petition), Biwater).
III. ASSESSING CRITIQUES OF THESE DEVELOPMENTS
This shift towards acceptance of written amicus curiae submissions may well indicate that NAFTA and ICSID arbitration is adopting more open and inclusive arbitration procedures. It may be argued that this shift reflects the current direction of the role of in international law. That is, NGOs have become increasingly influential in the creation of international policy and law.Footnote 81 Although NGO involvement in international policy and law-making is not a new phenomenon,Footnote 82 NGO's role and influence have expanded considerably in the 1990s, particularly in the context of environmental and human rights issues, which have attracted the largest number of amicus curiae submissions in investment treaty arbitration.Footnote 83
In the field of the international environmental law and policy, the 1992 UN Conference on Environment and Development (‘UNCED’) was ‘a watershed for NGO participation in the international policy-making process’.Footnote 84 This is evidenced not only by the extensive participation in UNCED but also by the Agenda 21 it adopted,Footnote 85 which explicitly affirms the important role of NGOs in international policy-makingFootnote 86 and requires States to provide support for them ‘to enhance their partnership role in programme design and implementation’.Footnote 87 It is also pointed out that environmental NGOs play an important role in the development, application and enforcement of international environmental law ‘in their capacity as watchdogs’.Footnote 88
In the field of human rights, the 1993 UN World Conference on Human RightsFootnote 89 also attracted the wide participation of NGOs.Footnote 90 Their impact is observable in the preamble of the Vienna Declaration and Programme of ActionFootnote 91 adopted as a result of the Conference which states: ‘bearing in mind the suggestions made by intergovernmental and non-governmental organizations’.Footnote 92 The declaration also explicitly recognized the role of NGOs to elaborate, implement and protect human rights.Footnote 93 A similar endorsement of the role of NGOs is found in the declaration on rights and responsibilities, which was adopted by the UN General Assembly in December 1998.Footnote 94
NGOs also play an important role in the creation of international norms,Footnote 95 despite their lack of capacity to conclude treaties.Footnote 96 In the context of investment treaties, it should be recalled that the hostile campaign by international NGOs against the draft Multilateral Agreement on Investment (‘MAI’) was one of the factors that led to the failure of the negotiation to adopt the MAI.Footnote 97
Therefore, the amicus curiae submissions in investment treaty arbitration may be perceived as an effort by NGOs to further implementation of international environmental and human rights norms. Nevertheless, this new trend has not necessarily received full endorsement. Several concerns have been raised over amici, their roles and the impact of amicus curiae participation on investment treaty arbitration. The next subsections demonstrate that these concerns are either misplaced or avoidable, and therefore do not constitute valid objections to the acceptance of amicus curiae submissions.
A. Effect On Arbitration Strategies of The Disputing Parties
The first concern is that amicus curiae submissions might interfere with the parties' carefully constructed strategy for victory.Footnote 98 It is also argued that the intervention by amici may ‘erode the traditional basis of arbitral proceedings, namely the consent of the parties’.Footnote 99
The latter concern appears to be related to the principle of party autonomy,Footnote 100 according to which the disputing parties should be in control of the arbitration proceedings.Footnote 101 It is referred to as ‘the guiding principle in determining the procedure to be followed in an international commercial arbitration’,Footnote 102 and reflected in article 19(1) of the 1985 UNCITRAL Model Law:Footnote 103 ‘[s]ubject to the provisions of this Law, the parties are free to agree on the procedure to be followed by the arbitral tribunal in conducting the proceedings’. It is therefore clear that the principle of party autonomy primarily applies to procedural issues. Should the third party be given party status rather than allowed to participate as amicus, such an intervention will indeed be in tension with the principle of party autonomy.Footnote 104 Yet the tribunals have made it clear that amici do not have any right in arbitral proceedings, as examined in section II. The acceptance of amicus curiae submissions, which gives no procedural right to amicus, does not conflict with the disputing parties' power to control arbitration proceedings, eg to choose: the lex arbitri, place of arbitration, arbitral tribunal, language, substantive law governing the dispute and so on.Footnote 105 To be sure, it affects the parties' control over the speed at which their case progresses and this issue will be examined below (B.1).
The first concern that they may upset the parties' strategies to win deserves a more detailed examination. In investment treaty arbitration, as international commercial arbitration, tribunals rely primarily on the arguments of the parties. In other words, ‘the written submissions in ICSID cases are generally the most influential part of the record for the arbitrators’.Footnote 106 In such a system, the parties carefully structure their arguments, select the legal and factual issues to be presented, as well as gather and select evidence to support their case. The acceptance of amicus curiae submissions introduces a change to this structure. As an independent third party, an amicus will, and is supposed to, make arguments from its own perspective. This means that it may present legal and factual arguments that the parties do not make—and indeed often deliberately omit because of political pressure or other tactical considerationsFootnote 107—before the tribunal. Indeed, in the WTO context, it is argued that ‘for many private actors seeking to participate in a WTO dispute, the primary purpose is to present factual information or express an argument left ignored by the governments’.Footnote 108 If such arguments of amici affect the tribunals' decision on substantive issues, it may surprise the disputing parties. Such a consequence not only is an interference with the parties' strategy to win, but also brings a substantial change to the arbitration system designed by the parties.
That the tribunals have confirmed that the acceptance of written amicus curiae submission is a ‘procedural’ matter is not relevant in this context.Footnote 109 Without doubt, procedural aspects of arbitration such as rules of evidence do affect the substantive outcome of disputes. Arguments of third parties, brought into the procedure through the ‘procedural’ door of amicus curiae submissions, may well also influence the outcome of the dispute.Footnote 110
In the case of purely commercial disputes where the impact of an arbitral award is limited to the disputing parties, it is not only unnecessary but also inappropriate to introduce such a change, because from the viewpoint of the parties, it may well produce an unexpected result only at the expense of efficiency of the arbitration process. However, investment treaty arbitration is distinct from commercial arbitration, in that it is also a method of public law adjudication in which arbitrators deal with regulatory and public policy issues of the host State.Footnote 111 Investor-State disputes often involve issues that ‘touch upon matters of public policy’,Footnote 112 and therefore arbitral awards may have a significant impact on the welfare of the citizens of the host State.Footnote 113 This does not just have implications for the ‘public purse’ (ie awards against the host State or State entity are funded through taxes levied on citizens),Footnote 114 which may also be affected by a purely commercial dispute when, for example, it involves a State-owned company. Investment treaty arbitration involves other important public interests. Marshall and Mann identify the following:Footnote 115 (a) the disputes often arise in public service sectors that affect the daily life of citizens such as water, oil and gas, electricity, waste disposal and so on;Footnote 116 (b) investor-State arbitrations may challenge regulatory measures intended by States to protect the public welfare, if the measure directly or indirectly affects the value of the investment; (c) the threat of investor-State arbitration may have a ‘chilling effect’ on States adopting public welfare regulations; (d) as investor-State case law is now central to the future direction of international investment law, the arbitration process is important to the development of international investment law (as noted in Introduction). In fact, the investment arbitration tribunals that have accepted amicus curiae submissions never fail to mention the ‘public nature’ of the disputes (Methanex;Footnote 117UPS;Footnote 118Suez/Vivendi;Footnote 119Suez/InterAguas;Footnote 120Biwater Footnote 121).
With this regard, it should be noted that investment treaty arbitration cases such as Ethyl,Footnote 122SD Myers,Footnote 123Metalclad,Footnote 124Methanex,Footnote 125Tecmed,Footnote 126MTD,Footnote 127Santa Elena,Footnote 128 and Parkerings Footnote 129 indicate that investment treaty arbitration has now become an important international forum in which environmental issues are discussed. In the environmental context, the ‘chilling effect’ on environmental policy of the host State should never be underestimated.Footnote 130 There is the possibility that an award effectively forces the host State governments to repeal the challenged environmental measure(s), and such a possibility is not merely theoretical. An example is Ethyl,Footnote 131 in which the Canadian government had to overturn a ban on the sale of Ethyl's gasoline additive MMT, together with the payment of US$13 million in order to settle the dispute brought by Ethyl to a NAFTA tribunal. Moreover, even the mere threat of potential claims may chill the willingness of a host State to adopt future environmental measures or to enforce them in a meaningful manner.Footnote 132 That is, the economic and political costs associated with investment arbitration and ‘the general lack of transparency with regard to situations in which investors threaten to initiate cases against states’Footnote 133 may well discourage the host State from raising its environmental standards. The potential chilling effect on the future exercise of regulatory authority (in the context of the threat of expropriation claims) was recognized by one arbitrator in SD Myers.Footnote 134
On the other hand, arbitrators, who act in the capacity of private lawyers, lack the mandate of the people affected by the award they make. Where an arbitral tribunal is composed of three arbitrators, the most common method of appointment is that each disputing party appoints one arbitrator, and the two arbitrators or an arbitral institution appoints the third, presiding arbitrator. This means that at least two arbitrators are not nationals of the host StateFootnote 135 and therefore less acquainted with political, social, cultural and environmental circumstances of the host State than judges of the host State. Arguably, it leads to apathy about the impact of the award on the public good and citizens of the host State. Also, arbitrators are not tenured but appointed in each case, and their decisions are free from the possibility of appeal.Footnote 136 This means the absence of internal control or an external check mechanism on the tribunals' understanding of relevant public issues, interpretation of treaty provisions that are in tension with the public interests of the host State, and the outcome of disputes. Although these features (party-appointed arbitrators, the absence of tenure and an appeal system) are almost axiomatic to international commercial arbitration, they do not necessarily sit well with the public aspects of investment treaty arbitration. This dissonance is highlighted when considering that other ‘public’ international courts and tribunals that have either a tenure system (eg the European Court of Human Rights (‘ECtHR’) and the WTO Appellate Body) or an appeal mechanism (eg the WTO DSB).Footnote 137 Furthermore, it is pointed out that the implications of investment treaty arbitration for domestic public law is profound especially because arbitrators may award damages ‘even if the actual impact on governmental decision-making is difficult to assess, given the confidentiality that surrounds the system’.Footnote 138
These considerations give rise to the concern that the dispute might be resolved in a way that impairs the citizens' rights. It is these concerns that lie at the heart of the argument for the change of investment treaty arbitration proceedings. In this context, it should be noted that Van Harten, Loughlin and Tollefson argue that what distinguishes investment treaty arbitration as a unique form of adjudication is not the impact of the awards but the fact that the investors' right to arbitrate is derivative of the host States' general consent to arbitration given in investment treaties.Footnote 139 Van Harten argues that the approach focusing on the consequences of investment treaties is ‘less compelling’, because: while commercial disputes may also raise issues of public interest,Footnote 140 the fact that the State's consent to arbitration is limited to the specific contractual relationship (as opposed to a treaty-based consent that applies to a broad range of public regulations measures) makes the arbitration ‘less firmly entrenched in the public sphere than its investment treaty counterpart’.Footnote 141 However, whereas it may be true that the generality of the State's consent is ‘suffice to constitute an adjudication based on that consent as public law’,Footnote 142 it does not provide much guidance as to whether to allow third party participation to arbitral proceedings.Footnote 143 Rather, what is crucial in this context is that the regulatory conduct and measures of host States are challenged and judged by international law, and it is the resultant ramifications for the general public that necessitate more open and inclusive arbitration proceedings. Contract-based ICSID arbitration, in which the host States' consent to arbitration is specific, may also be distinguished from commercial arbitration in this regard, depending on the factual and legal circumstances of the case. For example, if a contract between an investor and a host State contains ‘stabilization clauses’, the breach of which may entail compensation and result in capital flight, a dispute based on the contract may well also have chilling effect on public policy development.Footnote 144 Indeed, although all the arbitration cases that have accepted amicus curiae submissions are treaty-based (and therefore this article focuses on investment treaty arbitration), the amended ICSID Arbitration Rules do not distinguish between treaty-based arbitration and contract-based arbitration. Amicus curiae briefs may also be accepted in contract-based arbitration under Rule 37, subject to the same criteria including the public nature of the dispute.
As noted at the outset of this article, it is argued that investment treaty arbitration is hybrid in the sense that the substantive aspects are governed by public international law, whereas it borrows the procedural rules of international commercial arbitration. Again, this should not be taken to mean that there is a dichotomy between the substantive law aspects and procedural aspects of investment treaty arbitration. If the procedural rules and practices affect the outcome of the disputes (as examined earlier in this section), these public features of investment treaty arbitration must be reflected in the procedural aspects of arbitration as well. As will be examined below in section IV, amicus curiae submissions are useful tools to introduce public perspectives into investment treaty arbitration. Their importance stands out when considering that the host State may not address certain issues of public importance for various reasons (as examined earlier in this subsection).Footnote 145 This also explains why accepting the arguments of third parties through their incorporation in the parties' submissions is not enough: such an incorporation does not occur when it is against the will of the parties.
Therefore, the need to respect the parties' arbitration strategies is not a legitimate reason to oppose the acceptance of amicus curiae submissions. Amicus curiae submissions are expected to reduce adverse effects of such strategies on the public good of the host State. Moreover, the parties' rights to formulate their arguments is respected to the extent that they are always given the right and opportunity to respond to the amicus curiae briefs submitted.Footnote 146
B. Other Concerns
Other concerns over third-party participation include the following: (a) that it will increase the cost of arbitration and delay the proceedings where the expense of the parties is already high; (b) that it may cause the ‘politicisation’ of investor-State disputes, which not only distorts the proceedings but also reduces the chances of settlement between parties;Footnote 147 and (c) that it is doubtful whether meaningful and effective amicus curiae submissions can be made in the absence of complete ‘transparency’.Footnote 148 The following subsections demonstrate that these concerns are either misplaced or avoidable.
1. Cost increase and delay
The tribunals themselves were concerned about the increase in cost and time caused by amicus curiae submissions,Footnote 149 and this concern is reflected in Rule 37(2) of the ICSID Arbitration Rules.Footnote 150 If the acceptance of written amicus curiae submissions is not the right of third parties but the discretion of tribunals (see section II), a number of options to mitigate this problem are available to tribunals. For example, a tribunal is free to reject the submissions that merely duplicate the arguments made by the parties.Footnote 151 When the tribunal accepts such submissions, it may limit the issues to be addressed to legal issues, or specify the form of the submission (eg to limit the length of the submission).Footnote 152 After all, it is for tribunals to strike a balance between ‘receiving excessive information and being as fully informed as possible on all points’.Footnote 153
2. Politicization of the dispute within the arbitral forum
The ‘politicization’ concern is misplaced, because in the case of a dispute which involves important public issues, the risk of politicization always exists regardless of third party participation in the arbitration proceedings. Any information on such a case will potentially cause strong public reactions. In addition, the materials of the case may be released by the parties.Footnote 154
Related to the politicization concern is the concern over the credibility of non-State actors, in particular NGOs.Footnote 155 These include issues such as: that NGOs often have only special and limited interests such as commercial and industrial interests (as opposed to the broader interests of the public);Footnote 156 that NGOs may sometimes be manipulated by States or private corporations through subsidy or funding;Footnote 157 and that their legitimacy is questionable as their internal decision-making processes is often neither democratic nor transparent.Footnote 158 The general examination of the appropriateness of NGO participation in international law making is beyond the purpose of this article,Footnote 159 but in the context of investment treaty arbitration, these concerns are largely misplaced.
First, there is nothing wrong with accepting submissions from various types of amici including ‘industrial’ NGOs or business corporations in investment treaty arbitration. In fact, the UPS tribunal accepted a submission from the US Chamber of Commerce. Similarly, the Glamis tribunal accepted the submission from the National Mining Association, which is comprised of corporations from the American mining sector (See, sections II(A)(2) and II(A)(3) respectively). By accepting arguments from amici that have different purposes and perspectives, tribunals may furnish themselves with a wider range of grounds for decision. It is further submitted that diversity of views and analytic competition among amicus curiae submissions will cross-fertilize the debate and thus contribute to a more in-depth analysis.Footnote 160 In addition, if the issue at stake is the balancing between the protection of economic interests of the foreign investor and other public interests of the host State, excluding submissions from commercial NGOs would be contrary to the equality of parties.Footnote 161 This is because what usually happens in amicus curiae participation is that whereas non-commercial NGOs such as environmental and human rights NGOs often support the position of the host State,Footnote 162 commercial NGOs, as the example of the Chamber of Commerce in UPS shows, often support the position of foreign investors. Above all, tribunals retain full power to ‘decide whether it will allow the litigation to be extended in the ways suggested by an amicus’.Footnote 163
Secondly, it is always possible (and necessary) for the tribunals to eliminate submissions from NGOs with dubious legitimacy or motivations in accordance with the guidelines set out by the FTC Statement on Third Party Participation and Rule 37 of ICSID Arbitration Rules. To put it another way, NGOs as potential amici always have to convince a tribunal that they meet the criteria set out in these guidelines.Footnote 164 The tribunal has the discretion to reject submissions from applicants that fail to do so,Footnote 165 such as where there are doubts about the submitter's transparency and the source of funding.Footnote 166
3. Doubts over the effectiveness of amicus curiae submissions without complete transparency
Potential amici need sufficient information on the subject matter of disputes in order to: find an arbitration to which it may contribute by its expertise and perspective;Footnote 167 decide whether or not to file a request for participation as amicus;Footnote 168 and make meaningful arguments.Footnote 169 The Suez/Vivendi Second Order on Amici acknowledged the need for access to the materials to make effective arguments. Yet the tribunal declined the request for full access to the materials on the ground that in that particular case the amici possessed sufficient information without being granted access to the arbitration record.Footnote 170 In Biwater, the tribunal declined a similar request on the ground that the broad policy issues ‘on which the Petitioners are especially qualified’ are already in the public domain,Footnote 171 while leaving the possibility of revisiting the issue after future hearings.Footnote 172 These examples demonstrate that the question of disclosure cannot be answered in general, as the answer is dependent on many factors specific to each case, such as what the potential amicus intends to argue in its submission; what range of information is in the public domain; and how much information the potential amicus has already gleaned from other sources. It should also be noted that the tribunals examined in section II (save for Aguas del Tunari) all accept the possibility that certain materials may be released on a case by case basis.
IV. PURPOSE AND BENEFIT OF AMICUS CURIAE SUBMISSIONS
It has been demonstrated that the concerns over accepting amicus curiae submissions are either misplaced or avoidable. However, even assuming that some of the risks cannot be completely eliminated, they are overridden by the benefits brought by amicus curiae submissions from well-qualified NGOs, individuals, corporations and other organizations. First, as noted in section III(A), amicus curiae submissions may address certain factors the parties are unableFootnote 173 or unwilling to address, without being bound by the issues presented to the tribunals by the parties.Footnote 174 For example, in Methanex, while the US perceived the Californian ban on MTBE as a measure to protect public health,Footnote 175 the IISD and Bluewater submissions placed it in a wider context of environmental protection and raised the issue of the host State's right to protect the environment and promote sustainable development. Similarly, in UPS, submissions from CUPE and the Council of Canadians addressed the issue that neither Canada nor UPS raised, ie the possible ramification of the tribunal's decision on Canadian postal workers and consumers. These ‘extra’ perspectives will help tribunals not only to grasp the larger picture but also to make deeper analyses of the case through the ‘cross-fertilisation of the debate’ (as examined in section III(B)(2)). It is argued that ‘in some cases, the legitimacy of adjudicative decisions which affect regulatory concerns may require views other than those of the claimant and respondent to be represented in the process’.Footnote 176 It is further argued that international NGOs, which are free from any mandate to promote national goals, are more at liberty than the national governments to represent global interests.Footnote 177
Second, they may supply the tribunals with more comprehensive legal arguments than the parties, for example, by citing authority not contained in the parties' argumentsFootnote 178 or conducting detailed comparative legal studies.Footnote 179 For example, the amici in Biwater provided a detailed legal analysis on the investor's duty to act in good faith under international law.Footnote 180 Considering that investment treaty arbitration tribunals have limited capacity to conduct their own research,Footnote 181 such comprehensive studies by amici may well broaden the basis of the tribunal's analysis and help the tribunal to reach good quality decisions.Footnote 182 This will be particularly so when the relevant issues are outside of the arbitrators' areas of expertise.
Third, they may provide expert scientific or technical knowledge, or provide an extra layer of factual information specific to the dispute. For example, environmental policy is normally based on ‘a careful problem identification, fate and transport analysis, epidemiological and ecological studies, risk assessment, policy design and options development, and cost-benefit analysis’.Footnote 183 When a tribunal is required to assess the appropriateness of environmental measures as an application of such environmental policy, the comprehensive analysis made by expert NGOs (eg international and local NGOs may combine their expertise and knowledge and make a joint submission) will be particularly valuable. In the area of human rights law, it is pointed out that NGOs are best placed to propose ‘good practice’ with their grassroots experience.Footnote 184
Fourth, they may inform the tribunals of the broader implications of a decision beyond the particular interests of the parties.Footnote 185 They may also provide a measure of access to a particular third party whose interests may be affected by the decision because of their close relationship with the dispute.Footnote 186
It would be incorrect to assume that amicus curiae submissions automatically broaden public acceptance of the outcome and therefore enhance the legitimacy of the decisions of the tribunals in this sense.Footnote 187 Rather, the primary contribution of these submissions is to the content of such decisions. That is, as ‘friends of the court’, the primary purpose of amici should be to assist tribunals by providing additional information and arguments.Footnote 188 At any event (whatever the real purpose of each amici is),Footnote 189 the reason for tribunals to accept amicus curiae submissions should be to enhance the quality and credibility of their own decisions.Footnote 190 That said, whether amicus curiae submissions may actually fulfil such functions or not depends on how each tribunal uses these submissions, and the next section will examine this point.
V. EARS TO HEAR OR NOT?
That the tribunals have power to accept written amicus curiae submissions does not necessarily mean that they take into consideration those submissions. How much weight is given to such submissions also depends on the tribunals. As examined in section II, the tribunals have made it clear that the receipt of an amicus curiae submission is not a right of non-disputing parties but a matter of discretion. In other words, (potential) amici do not have the right to be heard. Taken to its logical conclusion, even if their submissions are received by a tribunal, it is also within the discretion of the tribunal whether to mention or consider them in the awards. It follows that there is the possibility that the acceptance of amicus curiae submissions becomes an empty promise. Therefore, the fact that amicus curiae submissions may be ‘accepted’ by the tribunals is not enough to conclude that there is now greater openness in the investment treaty arbitration regime. What is equally important is whether the accepted briefs are also taken into account by the tribunals. In this regard, the case law of the WTO judicial bodies with regard to the use of amicus curiae submissions illustrates the possibility of an ‘empty promise’.
A. The WTO Case Law
Although the WTO judicial bodies are open to written amicus curiae submissions, it is argued that the Appellate Body and the panels have not made substantive use of them.Footnote 191 The Appellate Body in Shrimp–Turtle Footnote 192 confirmed that a WTO panel has the authority to accept non-requested amicus curiae submissions on the ground that the panels' comprehensive authority to seek information from any relevant sourceFootnote 193 and to add to or depart from the Working Procedures in Appendix 3 to the DSUFootnote 194 permits them to accept and consider or to reject information and advice.Footnote 195 This decision has been confirmed by subsequent cases including Lead and Bismith II Footnote 196 and Asbestos,Footnote 197 in the latter of which the Appellate Body established guidelines for the acceptance of amicus briefs. Nevertheless, the Lead and Bismith II tribunal noted that an amicus that filed an unsolicited brief has no right to have it considered,Footnote 198 and the Asbestos guideline clarified that ‘[t]he grant of leave to file a brief by the Appellate Body does not imply that the Appellate Body will address, in its Report, the legal arguments made in such a brief’.Footnote 199 Indeed, in practice, amicus curiae submissions have never had an acknowledged impact on the decision of a panel or the Appellate Body. In all proceedings in which the panels accepted the amicus curiae submissions, the panels and the Appellate Body either explicitly stated that the amicus briefs were not of assistance in rendering a decision or were silent as to whether the amicus briefs were of any assistance in rendering its decision.Footnote 200 A recent example is the EC–Biotech case.Footnote 201 In that case, the panel received three amicus curiae briefs from a group of university professors, two groups of non-governmental organizations represented by the Foundation for International Environmental Law and Development and by CIEL respectively. However, the panel explicitly stated that it ‘did not find it necessary to take the amicus curiae briefs into account’,Footnote 202 while it consulted several individuals and international organizations (Codex, FAO, the IPPC Secretariat, WHO, OIE, the CBD Secretariat and UNEP) in determining the ‘ordinary meaning’ of certain terms of Annex A to the SPS Agreement.Footnote 203 It is observed that ‘[t]he consultations with scientific and technical experts were more influential in bringing non-WTO sources of law to the Panel's attention’.Footnote 204
Therefore, it is submitted that this openness of the WTO towards the amicus curiae participation is ‘more apparent than real’.Footnote 205 It should be noted that this reluctance is perhaps because of the severe criticism of the Appellate Body's decisions such as Shrimp – Turtle and Asbestos by the WTO member States. The member States (except for the United States) reacted negatively to these decisions, on the grounds that: it was for the membership to decide whether, and to what extent, NGOs should participate in the WTO; the Appellate Body was expanding its authority without a clear legal basis; and the Appellate Body exceeded its judicial function by in effect legislating.Footnote 206 As a result of the special meeting held in response to the Asbestos decision, the Chair of the WTO General Council concluded that ‘the Appellate Body should exercise extreme caution in future cases until Members had considered what rules were needed’.Footnote 207
B. Investment Treaty Arbitration
First of all, it has to be noted that the paucity of cases makes it impossible to observe a trend in investment arbitration tribunals. As of February 2010, only four of the cases in which amicus curiae submissions were accepted have been concluded with final awards, and these awards show different attitudes towards the use of the submitted amicus curiae briefs.
In Methanex,Footnote 208 the tribunal expressly referred to and agreed with the argument provided by the IISD, in determining whether or not the term ‘like circumstances’ in article 1102 NAFTA could mean the same as the term ‘like products’ in article III of the GATT.Footnote 209 It should be noted that the US also incorporated the IISD's argument in its own submission, but the tribunal appears to have relied on the IISD's analysis directly, which was more detailed than that in the US submission.
By contrast, in UPS,Footnote 210 the tribunal did not make any reference to the amicus curiae briefs in its final award. Neither did it implicitly use the arguments made in the amicus curiae briefs it received. The Chamber of Commerce argued that the concept ‘in like circumstances’ under article 1102 NAFTA should be interpreted in a manner that is consistent with the national treatment obligations under article III of the GATT. However, the tribunal did not even refer to the comparison between NAFTA and GATT, although the tribunal devoted 33 pages to the question of whether UPS and Canada Post are ‘in like circumstances’ regarding customs treatmentFootnote 211 and Canada's publication assistance program.Footnote 212 Likewise, the tribunal did not refer to the argument concerning the rights and protection of Canadian postal workers raised by the CUPE and Council of Canadian.
In July 2008, the ICSID tribunal in Biwater issued a final award in which the tribunal provided an interesting example of the treatment of the submitted amicus curiae brief. Having summarized the amicus curiae arguments made by the Petitioners in considerable detail, the tribunal explicitly stated that the arguments and information provided by the Petitioners were useful and have informed the tribunal's analysis of claim.Footnote 213 However, somewhat contradictory to this tribute to the amicus curiae brief and the statement that ‘where relevant, specific points arising from the Amici's submissions are returned to in that context’,Footnote 214 the arguments made by the amicus were actually left unexamined in the award, as explained below. The amicus curiae arguments can be broadly summarized as follows. First, foreign investors are under certain duties such as to apply proper business standards to the investment process, to observe the principle of pacta sunt servanda, and to act in good faith.Footnote 215 Secondly, the highest level of responsibility must be imposed on foreign investors before seeking the protection of international law, when they engaged in projects intimately related to human rights and the capacity to achieve sustainable development. In this sense, human rights and sustainable development issues are factors that balance of rights and obligations as between the investor and the host State.Footnote 216 Thirdly, a BIT cannot serve as an insurance against business risk and investors cannot seek the protections of international investment agreements in order to avoid the commercial, contractual or regulatory consequences of their acts.Footnote 217 Among these, the issues included in the last argument, ie the issue of risk-taking and the effect of the investor's conduct on the consequence were (albeit rather unclearly) examined in the award.Footnote 218 However, it was in response to the argument made by the host State in the context of expropriation which raised the same issues as the last argument,Footnote 219 rather than in response to the amicus curiae brief. Apart from this indirect reference, there was no other reference to the arguments made by the amici in the award. That is, subsequent to the summary of the amicus curiae arguments, there was no mention of the principle of sustainable development or the right to clean water. Likewise, the tribunal did not examine if Biwater breached the duties of foreign investors under international investment law. The tribunal concluded that Tanzania's conduct constituted violations of the obligations under the relevant BIT, including: the fair and equitable treatment standard; unreasonable and discriminatory conduct; and an expropriation, although it dismissed Biwater's claims for damages for lack of causation between the wrongdoings and damages.Footnote 220 Therefore, despite the fact that the tribunal provided a detailed summary of the amicus curiae arguments and stated that these arguments were useful, it may well be argued that this was just lip service. It is unfortunate that the tribunal did not revisit and examine the issues of sustainable development and the right to clean water, because the tribunal itself acknowledged, in the same award, that: this dispute is of the public nature; the Petitioners have specialized interests and expertise in human rights and environmental issues; and that they provided perspectives that have been demonstrated to materially differ from those of the two contending parties' and therefore ‘have provided a useful contribution to these proceedings’.Footnote 221
Finally, in the recent Glamis award, the NAFTA tribunal did state that it should address amicus filings explicitly in its award ‘to the degree that they bear on decisions that must be taken’.Footnote 222 Yet the tribunal went on to state that ‘[g]iven the Tribunal's holdings, however, the Tribunal does not reach the particular issues addressed by these submissions’,Footnote 223 and did not make any reference to amicus curiae briefs in its judgment on the merits. In this case, the investor argued that a series of measures taken by the federal government and the State of California violated articles 1110 and 1105 of the NAFTA. In considering the investor's expropriation claim, the tribunal focused on the effect of the contested measures on the value of the right that allegedly was taken from Glamis. It therefore assessed the value of the investor's mining project in the light of the additional costs required to meet the environmental criteria in the measures, and concluded that these measures ‘did not cause a sufficient economic impact to the Imperial Project to effect an expropriation of Claimant's investment’.Footnote 224 With regard to article 1105 NAFTA, the tribunal set a high threshold for establishing the fair and equitable standard of treatment, that is, a breach of the standard ‘requires an act that is sufficiently egregious and shocking—a gross denial of justice, manifest arbitrariness, blatant unfairness, a complete lack of due process, evident discrimination, or a manifest lack of reasons’.Footnote 225 The tribunal then concluded that none of the measures in question, nor the host State's conduct as a whole, met this criteria.Footnote 226 For both claims, the tribunal examined whether the thresholds (for the occurrence of an expropriation and establishing a breach of the fair and equitable standard of treatment) were met on the facts of the case, without considering particular issues raised,Footnote 227 or the arguments made, in the amicus curiae briefs. Consequently, the amicus curiae briefs did not influence the tribunal's decision to dismiss the investor's claim in its entirety.
C. Need for the Reference
Admittedly, the impact of amicus curiae submissions on the final decisions is difficult to measure. While express reference to them does indicate some influence, no mention does not necessarily mean no influence. Nevertheless, express reference to amicus curiae briefs in the decisions is desirable for the following reasons. First, the purpose of accepting amicus curiae submissions in investment treaty arbitration is not, and should not be, just to appease the sentiments of third parties who have an interest in the outcome of the dispute or to calm public disquiet about the closed nature of investment treaty arbitration. If this was so, the mere fact that their submissions were accepted would have served this purpose. Although the acceptance of amicus curiae submissions may have the ancillary effect of increasing the transparency of investor-State arbitrationFootnote 228 and, as a result, enhancing public acceptance of the awards,Footnote 229 the primary purpose and effect of amicus curiae submissions is to contribute to the better quality of an award.Footnote 230 As examined above in section IV, this may be achieved by providing broader perspectives, comprehensive legal analyses, wider range of factual information and so on. In the context of environmental issues, for example, detailed analyses of the recent development of international environmental law provided by amici may well help the tribunals when it balances the protection of foreign investment against environmental interests.
Secondly, as tribunals have the discretion as to whether to accept amicus curiae submissionsFootnote 231 and may specify the issues addressed in the briefs, they may limit the submissions to those they deem to be useful. In addition, the fact that their request for submissions is accepted by a tribunal would create a legitimate expectation on the part of the amici that the tribunal would consider their submissions in good faith.Footnote 232 This being so, the tribunal is expected, regardless of whether it agrees with the arguments made in the briefs or not, to refer to and respond to such arguments. Thirdly, the reason for the underuse of the amicus curiae submissions by the WTO judicial bodies, ie the criticisms that the Appellate Body interfered with the power of the WTO member States without a clear legal basis, does not apply to investment treaty arbitration. As far as NAFTA and ICSID arbitrations are concerned, tribunals now have a legal basis to accept such submissions and the submission of amicus curiae briefs is already a common practice under these regimes.Footnote 233 It should also be noted that it may be becoming a common practice beyond the NAFTA and ICSID. For example, Canadian FIPA (article 39), investment chapters of the US Free Trade Agreements with Chile (article 10.19(3)) and Morocco (article 10.19(3)), and the draft US/Peru TPA (article 10.20(3)) provide that the tribunal has the authority to accept and consider amicus curiae submissions from a person or entity that is not a disputing party.Footnote 234 If future BITs follow this trend, amicus curiae submissions will be given an even firmer footing.
In sum, the rationale behind the new rules and practices on amicus curiae submissions requires investment arbitration tribunals to take the submission seriously. The way to achieve this is left to each tribunal, but as a minimum requirement it should summarize the arguments made in the submission and respond to themFootnote 235 in its reasons for award. This is the approach taken by the ECtHR.Footnote 236 Although it is within the tribunal's discretion what weight to give the arguments made in each amicus curiae submission, the fact that the tribunal accepted the submission will make it appropriate for the tribunal to explain the reasons for agreeing or disagreeing with them.
VI. CONCLUSION
This article has demonstrated that the law and practice of investment treaty arbitration has shifted towards more open and inclusive procedures by opening the door to amicus curiae submissions. Although concerns have been raised over such a shift, they are largely misplaced or avoidable, and outweighed by the benefits amicus curiae briefs may bring to the investor-State dispute settlement process.
Amicus curiae briefs, if they have gone through a proper screening process, will actually contribute to the better quality of an investment arbitration award by providing tribunals a broader perspective, comprehensive factual/legal arguments and expert knowledge etc. More fundamentally, they bridge the gap between (public) substantive aspects and (private) procedural aspects of investment treaty arbitration. While incorporating rules and practice that govern international commercial arbitration, investment treaty arbitration is a forum to adjudicate the legality of the exercise of sovereign power of the host State, including its regulatory measures. As a consequence, investment treaty awards often have significant impact on public interests. Amicus curiae briefs will mitigate this discrepancy between substance and procedure, because they assist investment arbitration tribunals to realise the public issues surrounding the relevant dispute, and better understand the actual impact of their decisions on the public. In other words, this discrepancy makes it necessary for investment treaty arbitration to depart from procedural rules of international commercial arbitration. Although there are other important issues remaining to be solved such as the issue of confidentiality of the proceedings,Footnote 237 the change concerning amicus curiae submissions is one step towards such a departure.
On the other hand, under the current rules and practice, whether or not a tribunal receives an amicus curiae submission is a matter of the discretion of the tribunal. Taken to its logical extension, therefore, it is also within the discretion of the tribunal whether (and to what extent) to consider arguments made in the amicus curiae briefs received. It follows that there is a possibility that this ‘framework change’ turns out to be an empty promise, depending on whether and how tribunals consider the amicus curiae briefs. Case law of investment treaty arbitration on this issue has not been consistent.
In order for this framework change to successfully mitigate the public (substance)–private (procedure) disparity in investment treaty arbitration, amicus curiae briefs should have a substantial, rather than nominal, role to play—they should not be lightly disregarded. What is required is for the tribunals to make careful and proper selection of each amicus curiae submission, and once they received the submission, to make effective use of it.
