ARTICLE 8.27: CONSTITUTION OF THE TRIBUNAL

In response to some of the perceived shortcomings of the ISDS regime expressed by various stakeholders and the public in recent years, ^{Footnote 41} CETA creates a permanent investment tribunal of first instance (the tribunal), empowered with the exclusive competence to hear claims of alleged breach of the investment protections contained in the Investment Chapter. ^{Footnote 42} It warrants noting the interesting, and, no doubt, deliberate, change in the prevailing lexicon from “arbitrator” to “members” of the tribunal/appellate tribunal. ^{Footnote 43} Perhaps aimed at assuaging the perceived “halo of mistrust,” ^{Footnote 44} the term “arbitrator” no longer appears anywhere in the Investment Chapter.

CETA’s tribunal will be composed of fifteen members who will sit for up to two five-year terms. Each side (the EU and Canada, respectively) will appoint five members, with the remaining five neutral members to be appointed by the Joint Committee. ^{Footnote 45} The Joint Committee has the power to increase or to decrease the number of members of the tribunal by multiples of three (appointed on the same equal national representation basis between the EU, Canada, and third-country neutrals). This approach is completely different from the dispute settlement procedure provided for by many arbitral rules, whereby an ad hoc tribunal, consisting of party-appointed arbitrators and a third presiding arbitrator, is established to hear a particular case. Under CETA, the members of the tribunal cannot be appointed by the disputing parties but, rather, must be appointed from the roster of members of the tribunal established by the parties to the treaty.

The tribunal will hear cases in divisions of three members on each particular case. ^{Footnote 46} The divisions will be appointed by the president of the fifteen-member tribunal, within ninety days of the submission of the claim, by way of a randomized rotation procedure, who must ensure that each member has an equal opportunity to serve on a division. ^{Footnote 47} Notably, the division must issue a final award in each particular case within twenty-four months of the filing of the claim, although it may take additional time if it informs the disputing parties, giving reasons. ^{Footnote 48} If the Joint Committee fails to appoint fifteen members to the tribunal within ninety days from the date that the first claim is submitted to the ITS, either disputing party ^{Footnote 49} may request that the ICSID Secretary General appoint a division comprising three members of the tribunal, unless the disputing parties have agreed on a sole arbitrator. ^{Footnote 50} CETA further provides that the Secretary General must make the appointment by random selection from the existing nominations. The Secretary-General may not appoint as chair a national of either Canada or an EU member state unless the disputing parties agree otherwise. ^{Footnote 51}

The tribunal’s president and vice-president are responsible for organizational issues as they arise and will each serve a two-year term. ^{Footnote 52} They must be drawn by lot from among the members of the tribunal who are nationals of third countries and will be appointed on a rotational basis, drawn by lot, by the Joint Committee. ^{Footnote 53} Therefore, all five non-national members will serve as president or vice-president by the end of each of their five-year terms. Whenever the president is unavailable, the vice-president must assume the position of acting president. ^{Footnote 54}

While vacancies in the fifteen-member tribunal must be filled as they arise, CETA promotes continuity in the tribunal’s institutional memory by requiring that the terms of seven of the fifteen members appointed immediately after the entry into force of the agreement, to be determined randomly, be extended to six years. ^{Footnote 55} Further, in the event of a member’s replacement, CETA provides that an incoming replacement arbitrator must stay on for the remainder of the predecessor’s term. ^{Footnote 56} Again, for continuity sake, an outgoing member of the tribunal (namely, one whose term has expired), who is still serving on a division of the tribunal on a particular case, may continue until a final award is issued. ^{Footnote 57}

Reflecting the principle of equality between the parties to CETA, five of the members of the fifteen-member tribunal will be nationals of a member state of the EU, five will be nationals of Canada, and five will be nationals of third states. CETA further specifies that either party may nominate non-nationals, who will then be considered nationals of that party and, thus, not eligible to serve as chair of a division or president/vice-president of the tribunal. ^{Footnote 58}

The Constitution of the tribunal under CETA is very different from the one provided for by the ICSID Convention regime. Under the ICSID Convention, each state has the right to designate four persons to the Panel of Arbitrators, “who may but need not be its nationals,” and the Administrative Council’s chairman is required to designate ten persons, each of a different nationality, to the panel. ^{Footnote 59} Notably, the disputing parties have the right to appoint arbitrators from outside the Panel of Arbitrators (a proviso that is not included in CETA, given its shift away from party-appointed arbitrators), but if the president of the Administrative Council has to appoint one or more arbitrators to a tribunal, that person must be selected from the Panel of Arbitrators. ^{Footnote 60} With respect to the nationality requirements for arbitrators, Article 39 of the ICSID Convention contemplates a limited role for nationals of the state party to the dispute and the state whose national is a party to the arbitration. Rather than prohibiting their appointment in absolute terms, it provides that “[t]he majority of the arbitrators shall be nationals of States other than the Contracting State party to the dispute and the Contracting State whose national is a party to the dispute.” ^{Footnote 61} Further, the nationality restrictions do not apply if each member is appointed by the agreement of the disputing parties. ^{Footnote 62} CETA, again, contains no such stipulation.

Similar to the appointment requirements under the ICSID Convention, ^{Footnote 63} candidates for membership in CETA’s tribunal must “possess the qualifications required in their respective countries for appointment to judicial office, or be jurists of recognised competence.” ^{Footnote 64} Tribunal member contenders must also have “demonstrated expertise in public international law,” and “[i]t is desirable that they have expertise in particular, in international investment law, in international trade law and the resolution of disputes arising under international investment or international trade agreements.” ^{Footnote 65} Therefore, CETA places more emphasis, compared to the ICSID Convention and other IIAs, on subject-matter expertise, in requiring that tribunal members be highly qualified in international law. Such a requirement likely seeks to preclude the appointment of some experienced commercial arbitrators and retired national judges, who have no public international law expertise.

It warrants noting that while “demonstrated expertise in public international law” is required, expertise in international investment law is stated to be “desirable.” The litmus test of the credibility of the ITS will be the identities, and quality, of the members of the tribunal. Given the prohibition against members acting as counsel and the obligation to ensure that they are available, ^{Footnote 66} it may be that at least some members will be retired national court judges, academics, or less experienced arbitrators, rather than those who are in high demand in the investment treaty area. Notwithstanding the laudable expertise prerequisites for appointment to the CETA tribunal, the terms of appointment might not be sufficiently attractive to those with active arbitration practices.

This brings the analysis to the issue of remuneration. Members of the tribunal must remain available to hear CETA arbitrations in exchange for a monthly retainer fee, ^{Footnote 67} to be determined by the Joint Committee, which will later be converted into a regular salary. ^{Footnote 68} The monthly retainer fee must be “paid equally by both Parties into an account managed by the ICSID Secretariat,” and if one party fails to pay the fee the other party may make a substitute payment (with any such arrears by a party to remain payable, with interest). ^{Footnote 69}

The Joint Committee will determine the applicable modalities and conditions of the transition from a retainer fee to a regular salary. ^{Footnote 70} Unless and until the CETA Joint Committee adopts a decision on the transformation of the initial part-time to full-time appointment, the amount of the fees and expenses of the members of the tribunal, other than the retainer fee, will be determined pursuant to the financial regulations under the ICSID Convention. ^{Footnote 71} Accordingly, CETA provides that the ICSID fee structure ^{Footnote 72} will govern the determination of the fees and expenses of the members of the tribunal, irrespective of the claimant’s choice of arbitration rules pursuant to Article 8.23(2). ICSID arbitrator fees are lower compared to those typically used in UNCITRAL and other ad hoc arbitrations. Some commentators have noted that the application of the ICSID fee structure to UNCITRAL arbitrations initiated under CETA might lead to a reduction in arbitrators’ fees. ^{Footnote 73}

In an effort to reduce costs, particularly for small to medium-sized enterprises (SMEs) or in instances where the damages claimed are relatively low, CETA further provides that “the disputing parties may agree that a case be heard by a sole Member of the Tribunal to be appointed at random from the third country nationals.” ^{Footnote 74} The respondent is obliged to “give sympathetic consideration to a request from the claimant to have the case heard by a sole Member of the Tribunal,” and such a request must be made before the constitution of the division of the tribunal. ^{Footnote 75} The phrase “sympathetic consideration” suggests no more than the expectation that the respondent will not reject the request out of hand and at least consider the claimant’s circumstances and the claim being advanced. This provision places the decision entirely within the good faith discretion of the respondent. Nonetheless, it can still be seen as an attempt to lower the costs of access to justice for claimants of meagre means, while at the same time reducing costs for the respondent.

With respect to administrative and organizational matters, the tribunal is empowered to draft its own working procedures. ^{Footnote 76} The Joint Committee does not have to approve the tribunal’s working procedures prior to their implementation. It is interesting to note that CETA does not include directions regarding the working procedures akin to those provided for under the draft EU–Vietnam Free Trade Agreement (EU–Vietnam FTA). ^{Footnote 77} The EU–Vietnam FTA provides much greater detail with respect to how the working procedures of the tribunal are to be drafted and adopted and is modelled after the WTO experience. ^{Footnote 78} It may be that Canada and the EU acknowledged their respective levels of capacity regarding investor–state arbitration and did not feel it necessary to expressly provide for what might otherwise be obvious, given Canada’s extensive experience with investor–state arbitration under NAFTA. It could also be that the parties wanted to reserve an element of flexibility for the appellate tribunal to develop its own procedures.

CETA stipulates that the ICSID Secretariat will provide the tribunal with “appropriate support.” ^{Footnote 79} However, the agreement is silent as to the extent of administrative and legal assistance, if any, the Secretariat will provide to the tribunal, particularly in light of the short deadlines that the treaty specifies for a division to hear a case and render its final award (twenty-four months). ^{Footnote 80} CETA is also silent with respect to whether the treaty parties or the disputing parties will bear the costs of the ICSID Secretariat’s administrative support equally.

ARTICLE 8.28: THE APPELLATE TRIBUNAL

The most notable result of CETA’s legal scrubbing is, of course, the creation of an appellate tribunal. CETA is the first signed treaty to adopt the EU’s appellate mechanism proposal. Unlike the draft EU–Vietnam FTA, CETA does not include the word “permanent” in describing its appellate tribunal, as it does in describing its permanent investment tribunal. Instead, CETA simply provides that “[a]n Appellate Tribunal is hereby established to review awards rendered under this Section.” ^{Footnote 81} This subtle distinction is perhaps a reflection of the EU and Canada’s agreement to pursue the establishment of a multilateral investment tribunal and appellate mechanism with other trading partners; ^{Footnote 82} which is also in the draft EU–Vietnam FTA. ^{Footnote 83}

The powers granted to divisions of the appellate tribunal are more expansive than those granted to ICSID annulment committees under Article 52 of the ICSID Convention. In particular, the appellate tribunal has the power to modify or reverse first instance awards as opposed to simply annulling an award in whole or in part. The scope of remedial power accorded to the appellate tribunal is also broader. In contrast to the limited grounds for annulment specified in the ICSID Convention, the appellate tribunal may modify or reverse an award based on: “(a) errors in application or interpretation of the applicable law; (b) manifest errors in appreciation of the facts, including the appreciation of relevant domestic law; (c) the grounds set out in Article 52(1)(a) through (e) of the ICSID Convention, in so far as they are not covered by paragraphs (a) and (b).” ^{Footnote 84} By encompassing the grounds for annulment set out in Article 52 of the ICSID Convention, plus review for error of law and fact, CETA’s one-stop-appellate-shop covers the full gamut of possible challenges to an arbitral award. The inclusion of the appellate tribunal and an appeal procedure allows for errors and defects to be corrected without the disputing parties having to resubmit the dispute to another tribunal following a successful appeal. Where the facts established by the tribunal so permit, the appellate tribunal shall apply its own legal findings and conclusions to the facts and render a final decision. Where this is not possible, it may refer the matter back to the tribunal of first instance. ^{Footnote 85}

Since the manifest excess of powers ground in Article 52 of the ICSID Convention includes jurisdictional error, ^{Footnote 86} it appears that Article 8.28(2)(c) of CETA would also include appeals for alleged jurisdictional error (since this ground is not expressly articulated in Article 8.28(2)(a) or (b)). This raises the question of whether the appellate tribunal only has jurisdiction over a final award, or may it entertain applications for leave to appeal a positive award (or, in ICSID parlance, a “decision”) on jurisdiction? Recall that under the ICSID Convention regime, there is only one award. However, under the UNCITRAL Arbitration Rules, there may be several awards, which, under the normal application of the UNCITRAL Arbitration Rules, may be challenged in judicial review proceedings before the final award is rendered (albeit this depends on the jurisdiction seized with the review). If CETA modifies this feature of the UNCITRAL Arbitration Rules in cases proceeding under those rules, the disputing parties would need to wait until the final award is rendered to appeal a positive or mixed jurisdictional award (eg, one accepting some claims but rejecting others) to the appellate tribunal, leading to significant additional costs for the parties should the jurisdictional decision ultimately be overturned.

CETA is notably silent as to the applicable standards of review in the context of an appeal under the listed grounds. For a review of an alleged error of law, the standard of review is correctness. Until CETA, and except in certain countries whose arbitration law provides a limited review for error of law, this type of review has been typically off limits. Therefore, the correctness standard has rarely been applied in the investor–state arbitration context. With respect to the review of an award for alleged jurisdictional error, it would make little sense for the more deferential “manifest excess of powers” standard, which requires more than a de minimus error, to apply. It would be incongruous to require that the error be “manifest” because excess of powers would logically be sufficient to reverse a finding, given the appellate tribunal’s power to correct legal errors and the fact that the correctness standard is more stringent than the “excess of powers” standard.

CETA’s inclusion of “manifest errors in the appreciation of the facts” ground for review in Article 8.28 seems to follow WTO practice, which essentially allows an appeal because the tribunal did not make an objective assessment. ^{Footnote 87} The inclusion of the modifier “manifest” in CETA might have been drawn from Article 52 of the ICSID Convention. If the approach taken by the ICSID Annulment Committees was to be applied, not just any error in appreciation of the facts would suffice to justify intervention, it would have to be “obvious, clear or self-evident, and which is discernable without the need for an elaborate analysis of the award.” ^{Footnote 88} Determining whether a manifest appreciation of fact has occurred might prove challenging. For instance, can the failure to give weight to a fact be a manifest appreciation error of fact? ICSID Annulment Committees have held that for the “manifest excess of powers” ground for annulment to succeed, the error must “jump off the page.” ^{Footnote 89} Therefore, the standard of review for a “manifest” error is a more deferential one than for mere error. This poses a potential interpretative issue. Under existing judicial review practice, less deferential approaches are taken for jurisdictional error — de novo review (even considering new evidence) or correctness (based on the existing evidential record) — than that taken by the ICSID Annulment Committees. It may be that since review for error of law requires no more than proof of such error, the appellate tribunal will be willing to accept a correctness standard for jurisdictional error even though the grounds of the ICSID Convention’s Article 52 are incorporated into CETA’s appellate tribunal provision (Article 8.28).

Unlike the draft EU–Vietnam FTA, ^{Footnote 90} CETA is silent as to whether any nationality restrictions on the arbitrators apply to the appellate tribunal as they do in the first instance tribunal. ^{Footnote 91} This begs the question of why nationality was deemed to require regulation at the tribunal level but not at the appellate tribunal level. In comparative terms, the provisions on the first instance tribunal appear to be more detailed and elaborate. This suggests that the provisions outlining the appellate tribunal will likely be supplemented by the Joint Committee.

Like the ICSID Convention regime, which completely restricts party involvement in establishing an ad hoc annulment committee to review an award (under Article 52, the Administrative Council chairman, not the disputing parties, controls the appointment process and the committee’s members must be appointed from the Panel of Arbitrators), CETA’s Joint Committee also controls the selection of members to the appellate tribunal. Like the appointment process for the members of the tribunal, the members of the appellate tribunal shall be appointed by a decision of the Joint Committee at the same time as it adopts a decision setting out administrative and organizational matters regarding the appellate tribunal’s functioning. ^{Footnote 92} Like the qualification requirements provided in Article 8.27(4) for the first instance tribunal, the members of the appellate tribunal must “possess the qualifications required in their respective countries for appointment to judicial office, or be jurists of recognised competence,” “have demonstrated expertise in public international law,” and, ideally, some experience in international investment law. ^{Footnote 93}

Like the tribunal, the appellate tribunal will sit in divisions of three randomly appointed members. ^{Footnote 94} The composition of the division will be decided on a rotational basis, thereby ensuring that the specific composition is unpredictable. This appears to have been drawn from the WTO Appellate Body process, the idea being that the disputing parties to a CETA arbitration will not know who their tribunal members will be on a particular case. CETA further provides that Articles 8.36 (Transparency) and 8.38 (Non-Disputing Party) shall also apply to the proceedings before the appellate tribunal. ^{Footnote 95}

The Joint Committee will be responsible for promptly adopting a decision setting out a number of key aspects of the administrative and organizational functioning of the appellate tribunal. ^{Footnote 96} CETA is silent as to whether a former member of the tribunal might later be appointed as a member of the appellate tribunal, as is often the case in most domestic legal systems, where trial judges are often promoted to courts of appeal. ^{Footnote 97} CETA further provides that its Committee on Services and Investment shall periodically review the functioning of the appellate tribunal and may make recommendations to the Joint Committee. The Joint Committee may then revise its decision regarding administrative and organizational matters accordingly. ^{Footnote 98}

Upon the adoption of a decision by CETA’s Joint Committee, setting out the administrative and organizational matters regarding the functioning of the appellate tribunal, a disputing party has ninety days in which to appeal an award. ^{Footnote 99} A disputing party is not allowed to otherwise seek to review, set aside, annul, or revise an award. ^{Footnote 100} An award must not be considered final, and no action for enforcement of an award may be brought until either: “(i) 90 days from the issuance of the award by the tribunal has elapsed and no appeal has been initiated; (ii) an initiated appeal has been rejected or withdrawn; or (iii) 90 days have elapsed from an award by the Appellate Tribunal and the Appellate Tribunal has not referred the matter back to the Tribunal.” ^{Footnote 101}

ARTICLE 8.29: ESTABLISHMENT OF A MULTILATERAL INVESTMENT TRIBUNAL AND APPELLATE MECHANISM

CETA contains a firm commitment that the EU and Canada shall pursue with their other trading partners the creation of a multilateral investment tribunal and appellate mechanism. On 13 September 2017, the Council of the EU authorized the EC to formally open negotiations for the establishment of a multilateral investment tribunal, which once established, would supersede the permanent tribunal and appellate tribunal in CETA. ^{Footnote 102} In this scenario, CETA merely provides that the Joint Committee shall adopt a decision that investment disputes under this section will be decided pursuant to the multilateral mechanism and make appropriate transitional arrangements. ^{Footnote 103} There is no indication in CETA as to how the multilateral mechanism would operate. A similar provision is included in the draft EU–Vietnam FTA. However, both CETA and the draft EU–Vietnam FTA are silent as to how differently worded provisions of various treaties will be addressed by any eventual multilateral mechanism empowered to adjudicate on claims brought under different treaties.

ARTICLE 8.18: SCOPE

Having described the main features of the tribunal and appellate tribunal, it is now appropriate to revert to the opening provisions of section F of the Investment Chapter, namely the scope of the ITS’s jurisdiction. While some treaties allow for the arbitration of any disputes relating to an investment, other treaties, such as NAFTA, only allow specific treaty and/or investment contracts to be submitted to investor–state arbitration. ^{Footnote 104} In unambiguous terms, and without prejudice to state-to-state dispute settlement, ^{Footnote 105} Article 8.18 of CETA excludes from the purview of the ITS investment disputes concerning purely contractual issues, ^{Footnote 106} measures that simply have an impact on investors’ profits, and claims of a breach of another part of CETA. ^{Footnote 107} Notably, there is also no umbrella clause in CETA. ^{Footnote 108}

The scope of CETA’s ITS provisions encompass only claims relating to non-discriminatory treatment (section C states: “with respect to the expansion, conduct, operation, management, maintenance, use, enjoyment and sale or disposal of its covered investment”) and investment protection (section D states: “where the investor claims to have suffered loss or damage as a result of the alleged breach”). ^{Footnote 109} Violations of any other provisions of CETA are not eligible for resolution under the Investment Chapter. ^{Footnote 110} Further, claims that concern “the expansion of a covered investment may be submitted only to the extent the measure relates to the existing business operations of a covered investment and the investor has, as a result, incurred loss or damage with respect to the covered investment.” ^{Footnote 111} Accordingly, CETA strictly limits access to the ITS only for breaches of the seven investment protection provisions stipulated in the treaty. ^{Footnote 112}

CETA also contains rules aimed at preventing fraudulent or abusive claims: “For greater certainty,” an investor will be barred from submitting a claim to arbitration where “the investment has been made through fraudulent misrepresentation, concealment, corruption, or conduct amounting to an abuse of process.” ^{Footnote 113} This provision enables tribunals to dismiss cases where there is evidence that the investment was obtained fraudulently or in some other unlawful way. ^{Footnote 114} It is also aimed at preventing the making or re-organization of an investment for the purpose of bringing a claim, as was found to be the case in the Philip Morris v Australia cigarette plain-packaging dispute. ^{Footnote 115} Other treaties that the EU has negotiated, but which have not yet entered into force, contain such provisions (for example, the draft EU–Vietnam FTA and the EU–Singapore Free Trade Agreement (EU–Singapore FTA)). ^{Footnote 116}

CETA also defines a “covered investment” as one that is “made in accordance with the applicable law at that time.” ^{Footnote 117} The inclusion of the “characteristics of an investment” test and the bona fide “in accordance with host state law” requirement follows what some commentators have construed as an expansion of the Salini criteria ^{Footnote 118} by the tribunal in Phoenix Action v Czech Republic. ^{Footnote 119} The parties’ decision in CETA to codify a reserve jurisdiction to discipline what might be found to be abusive treaty claims reflects the findings of tribunals in cases such as Inceysa v El Salvador ^{Footnote 120} and Phoenix Action v Czech Republic. ^{Footnote 121} In these cases, the respondent successfully argued that the investments had been made in an unlawful or abusive manner or to manufacture access to international jurisdiction after the measures complained of were taken.

ARTICLE 8.19: CONSULTATIONS

The requirement to attempt amicable consultations prior to submitting a claim to arbitration has become a common feature in many IIAs. ^{Footnote 122} CETA contains a detailed and strongly worded provision that imposes a pre-condition that disputing parties must engage in consultations before attempting to access arbitration. This provision aims to ensure that negotiation between the disputing parties is more constructive and conducive to a settlement prior to triggering the arbitral machinery than has been the case under existing treaties (where the process seems to be a matter of form rather than substance and where disputes often later arise as to whether one or both parties did not seriously engage in the consultations process). ^{Footnote 123}

Arbitral practice has been somewhat divided over the consultations requirement. While some tribunals have found that compliance with an amicable settlement requirement is compulsory prior to triggering the arbitral process (such that a failure to engage in such consultations might deprive the tribunal of jurisdiction ^{Footnote 124} ), others have found it to be merely “directory and procedural rather than as mandatory and jurisdictional in nature” ^{Footnote 125} and curable with the passage of time. ^{Footnote 126} Perhaps as a response to this inconsistency in the relevant jurisprudence, CETA sets out certain minimum time frames that must be observed in the consultations phase. For instance, the procedural requirements for the submission of a claim to the tribunal state that the investor must wait at least 180 days from the date of submitting the request for consultations and, if applicable, at least ninety days from the date of submitting the notice requesting a determination of the respondent. ^{Footnote 127} That said, the extent of the consultations appears to remain limited only to issues in dispute that, “as far as possible,” can be settled amicably. ^{Footnote 128}

Even after the claim for arbitration is submitted, the disputing parties may settle at any time. ^{Footnote 129} Consultations, however, must take place within sixty days of the mandatory submission of a request for consultations pursuant to Article 8.19(4), unless the disputing parties agree to an extension of time. ^{Footnote 130} A request for consultations must always be sent to the EU, irrespective of whether the underlying claims concern an alleged breach by the EU or of a member state. ^{Footnote 131}

First meetings have traditionally been held in person. Under CETA, the parties have contemplated the possibility of holding videoconferences for consultations. States and their counsel have become more comfortable with the idea of obviating the need for costly, in-person discussions through videoconferencing or teleconferencing. However, the fact that the parties have committed this to writing is not so significant since consultations could be held via videoconference regardless of whether an explicit provision in CETA recognized the possibility. However, enshrining the possibility of holding consultations via a videoconference, where, for instance, the investor is an SME, does appear to have the benefit of making this option a matter of fact for disputing parties. ^{Footnote 132} This provision, along with the possibility of a sole member of the tribunal hearing the case when both parties agree, ^{Footnote 133} and the possibility for the parties to adopt possible ceilings for costs of claims, ^{Footnote 134} are intended to lessen the financial burden on SMEs in bringing claims under CETA’s ITS framework. These innovations are helpful tools to move consultations along in a speedy and efficient manner, with a view to settling the underlying dispute amicably.

With respect to the locus of any consultations, under CETA, unless otherwise agreed by the parties to the dispute, they shall take place in: (1) Ottawa, if the impugned measures were adopted by Canada; (2) Brussels, if the measures challenged are EU measures; or (3) the capital of the EU member state if the measures challenged are exclusively measures undertaken by that member state. ^{Footnote 135}

Similar to a notice or request for arbitration, the investor must submit to the other party a “request for consultations,” which sets out the relevant particulars with “sufficient specificity to allow the respondent to effectively engage in consultations and to prepare its defence”: (1) the investor’s name, address, and place of incorporation (if applicable) and that of its co-investors; (2) evidence that establishes that the investor is an investor of the other party and that it owns/controls the investment (including the locally established enterprise on whose behalf the request is submitted, if applicable); (3) the provisions of the agreement alleged to have been breached; (4) the legal and the factual basis for the claim, including the impugned measures; and (5) the relief sought and the estimated amount of damages claimed. ^{Footnote 136}

CETA provides that a request for consultations will be subject to two important limitation periods, either:

1. (a) 3 years after the date on which the investor or, as applicable, the locally established enterprise, first acquired or should have first acquired, knowledge of the alleged breach and knowledge that the investor or, as applicable, the locally established enterprise, has incurred loss or damage thereby; or

2. (b) 2 years after an investor or, as applicable, the locally established enterprise, ceases to pursue claims or proceedings before a tribunal or court under the law of a Party, or when such proceedings have otherwise ended and, in any event, no later than 10 years after the date on which the investor or, as applicable, the locally established enterprise, first acquired or should have first acquired knowledge of the alleged breach and knowledge that the investor has incurred loss or damage thereby. ^{Footnote 137}

Article 18.19(6)(a) is a standard formulation, traceable to NAFTA. ^{Footnote 138} 18.19(6)(b) is a new provision. If the claimant has pursued its claims in a local court, and they are terminated or otherwise ended, it may bring its claim within the two-year limitation period but, in any event, will be beholden to an overriding ten-year limitation period. Finally, if the investor fails to submit a claim to arbitration ^{Footnote 139} within eighteen months of submitting the request for consultations (unless the disputing parties agree on an extension of time), the investor will be deemed to have withdrawn its invitation to consult. ^{Footnote 140} Further, the investor “shall not submit a claim under this Section with respect to the same measures.” ^{Footnote 141}

CETA makes a request for consultations a requirement for the submission of a claim to the tribunal. ^{Footnote 142} The submission of a claim must “not identify a measure in its claim that was not identified in its request for consultations.” ^{Footnote 143} This provision is a grafting of WTO practice onto investor–state arbitration, where the consultation document essentially defines the totality of the dispute, and it is very difficult to thereafter expand it. It is unclear whether a claimant would be allowed to supplement its original claims if new measures were taken by the respondent during the proceedings under the same set of facts. Under established investment treaty arbitration practice, an amendment for new claims would be permitted in such circumstances. ^{Footnote 144} The requirement that the request for consultations includes the whole claim is an example of CETA overriding the applicable arbitral rules. Even if the arbitration rules afford the tribunal the discretion to admit new claims by way of amendment, this provision might prove to be paramount for a claimant who is prevented from claiming new measures in its case. Should this scenario materialize, the claimant could commence a new claim and then seek consolidation, but this would be costly and unfair to the claimant.

ARTICLE 8.20: MEDIATION

CETA, unlike the vast majority of other IIAs, contains detailed provisions on mediation to encourage the amicable resolution of any disputes. The inclusion of a mediation option reflects increasing interest in recent years in finding alternatives to potentially lengthy and costly arbitral proceedings. In 2012, for example, the International Bar Association (IBA) adopted its Rules for Investor–State Mediation (IBA Rules). ^{Footnote 145} The IBA Rules comprise twelve articles in total, which, while reflecting many standard clauses also found in other institutional mediation rules, provide some innovative regulations. For instance, they contain a rule requiring that a mediation management conference be held, and another rule requiring that mediators disclose any potential conflicts of interest or personal interest in a statement of independence and availability. ^{Footnote 146} It is too soon to tell if the IBA Rules will contribute to an increase in the use of mediation in investment cases.

While mediation is an option provided for under CETA, ^{Footnote 147} it is not a mandatory part of the ITS regime in the same way as the consultations requirement enshrined in Article 8.19. ^{Footnote 148} Should the disputing parties embark upon mediation, they must merely “endeavour” to reach a settlement within sixty days from the mediator’s appointment ^{Footnote 149} — a time frame that some commentators say is too short within which to resolve highly technical complex investment disputes. ^{Footnote 150} Another commentator asserts that the mediation process is “unnecessary at best and, at worst, a threat to the useful work being done by arbitration.” ^{Footnote 151} In light of the fact that, at the time of writing, there has only been one publicly reported mediation of an investor–state dispute, it will be interesting to see whether disputing parties make use of mediation under CETA. ^{Footnote 152}

For the avoidance of doubt, Annex 29-C of CETA (Rules of Procedure for Mediation) is not applicable to mediations in the context of investor–state disputes under the Investment Chapter but, rather, is only applicable to state-to-state disputes. Instead, the rules governing any mediation pursuant to the Investment Chapter will be those chosen by the disputing parties (for example, the IBA Rules), along with Article 8.20 (Mediation) of CETA.

ARTICLE 8.21: DETERMINATION OF THE RESPONDENT FOR DISPUTES WITH THE EU OR ITS MEMBER STATES

Another unique aspect of CETA’s Investment Chapter is the provision dealing with how a Canadian claimant is to determine who to name as the respondent in a case involving the EU or an EU member state. Article 8.21 poses several potential interpretative challenges in this regard. The determination of the proper respondent is crucial at the outset of the arbitration for, if the claimant errs, the tribunal could find that it lacks jurisdiction over the proper respondent or the award might not be enforceable. If after ninety days has lapsed from the submission of the request for consultations and the dispute is not resolved, the next step is for the investor to deliver to the EU a notice requesting a determination of the respondent, ^{Footnote 153} which must identify the measures about which the investor intends to submit a claim. ^{Footnote 154} The EU will determine whether the measures challenged by the claimant are EU measures or those of one of its member states.

If both EU and member state measures are being challenged, the default respondent is the EU. ^{Footnote 155} In making its determination, the EU coordinates with its member states internally. The EU regulation on the allocation of financial responsibility for investor–state arbitration under EU investment agreements is Regulation 912/2014, ^{Footnote 156} which contemplates that, in limited circumstances, ^{Footnote 157} the EU may unilaterally direct that it, not the member state, is the respondent. Where the EU stands in the shoes of the member state, the Regulation states that the EU must consult with the member state and keep its best interests in mind. The Regulation further provides that the EU will bear the financial responsibility for the conduct of the case but that it can then turn to the member state to reimburse the EU budget.

CETA provides that the Canadian claimant may submit a claim for arbitration based on the EU’s determination, which the EU must provide to the claimant within fifty days from the date of the request for a determination. The claimant must wait at least 180 days to elapse from the request for consultations and, if applicable, at least ninety days from the notice requesting a determination of the respondent. ^{Footnote 158} However, if the EU fails to inform the investor within the fifty-day period, it is the responsibility of the investor to correctly construe the default position advanced by CETA. Where measures are exclusively those of an EU member state, the member state is the respondent; if the measures include measures taken by the EU, the EU is the respondent. ^{Footnote 159}

CETA is silent about what happens if the EU issues its determination after fifty days but prior to the ninety-day required lapse before a claim may be submitted to arbitration. ^{Footnote 160} Is the claimant obliged to accept the EU’s determination over its own determination under Article 8.21(4) if it disagrees? It would be wise for the claimant to heed the EU’s determination or to hedge by naming the EU and the member state as respondents (although the latter might expose it to a costs order for unnecessarily naming a party as a respondent). It is interesting that Canada and the EU chose not to address this forty-day time gap between the determination deadline and the first possible date on which the claimant may submit its claim.

Another notable provision is Article 8.21(6), which stipulates that where the EU or an EU member state is the respondent (pursuant to either the EU’s determination or the application of the default determination), neither the EU nor the member state “may assert the inadmissibility of the claim, lack of jurisdiction of the tribunal or otherwise object to the claim or award on the ground that the respondent was not properly determined.” ^{Footnote 161} The tribunal is strictly “bound by the determination made pursuant to paragraph 3 and, if no such determination has been communicated to the investor, the application of paragraph 4.” ^{Footnote 162} Further, once the respondent is identified (pursuant to Article 8.21(6)), neither the EU nor the EU member state “may assert the inadmissibility of the claim, lack of jurisdiction of the tribunal or otherwise object to the claim or award on the ground that the respondent was not properly determined.” If a tribunal finds that the EU’s determination of the respondent turns out to be wrong, Article 8.21(6) includes a “savings clause”. The EU will honour its obligations as if it were the proper respondent if an award is made against it and seek compensation from its member state.

Whether the member state will be amenable to cooperate with the EU – for example, in providing it with the necessary information and documents in cases where the EU member state is alleged to have breached CETA due to corruption on the part of its state officials – will be a matter of potential contention for the EU, not the claimant. While non-cooperation will likely occur from time to time, the answer to this quandary appears to rest on the legal enforceability of Regulation 912/2014. There are obligations under EU law requiring “sincere co-operation” in the context of relations between the EU and its member states. ^{Footnote 163} This means that the member states are obliged to cooperate with the EU and vice-versa. In addition to the regulation, general principles of EU law provide for the day-to-day cooperation between the EU and its member states.

While it might be advisable for claimants to initiate claims against the EU and a member state simultaneously, CETA does not explicitly envisage the possibility of multiple respondents. It is noteworthy that Article 8.21 does not address the possibility of a co-respondent status but, instead, refers repeatedly to the respondent as either the EU or an EU member state. ^{Footnote 164} In light of the EU’s overlapping layers of competence with its member states, it will be interesting to see “whether practice will find solutions to address the need to establish a co-respondent mechanism in the absence of clear language to that effect in the agreement.” ^{Footnote 165} Until there is clarity on the point, Canadian claimants will probably default to naming the EU in any case of doubt.

Seeking to enforce an award against the EU raises problems under the ICSID Convention because membership in the Convention as it is presently drafted is restricted to states. ^{Footnote 166} Thus, the strong enforcement provisions contained in Article 54 of the ICSID Convention apply to the territory of each contracting state, and the EU, although comprising many ICSID contracting states, is not itself a contracting state. ^{Footnote 167} Similarly, the EU is not a party to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York Convention). ^{Footnote 168} The parties to CETA have sought to overcome these hurdles by providing that, “for greater certainty,” an award shall be treated as if it were an ICSID Convention award, ^{Footnote 169} and non-ICSID awards shall be enforceable under the New York Convention. ^{Footnote 170} It is unclear how a sub-set of parties to a treaty (Canada and certain EU member states) can impose an interpretation of a multilateral treaty, such as the ICSID Convention, that binds non-parties to give effect to a CETA award as if it were an ICSID Convention award. This, again, is an instance where CETA purports to modify existing arbitral rules.

Article 8.21 of CETA is intended to resolve questions of jurisdiction over the proper party. In expressly setting out a procedure for identifying the respondent in any particular case, and the consequences of such a determination, this provision is clearly intended to protect investors from erroneous determinations by the EU regarding whether the respondent is the EU or the member state. It also appears to prevent the tribunal from deciding on the issue of competence between the EU and the member state. International responsibility follows competence — for instance, a Canadian province has no international responsibility since it cannot enter into international obligations. However, both the EU and its member states have this ability.

Further, under Article 8.21 of CETA, the EU agrees to forego any option to change its position on such determinations at a later stage. However, this provision might not fully protect a Canadian claimant that is suing a member state rather than the EU. If the claimant errs in naming the member state as the respondent, when it should have been the EU, there appears to be little recourse for that claimant. This situation is only hypothetically likely to arise if there is no determination, and consultations occurred, such that the EU was aware that there was in fact an EU measure involved. Therefore, again, when in doubt and where the EU does not provide its determination by the expiry of the fifty-day deadline, it is likely more advantageous for a claimant to sue the EU rather than the member state.

ARTICLE 8.22: PROCEDURAL AND OTHER REQUIREMENTS FOR THE SUBMISSION OF A CLAIM TO THE TRIBUNAL

CETA contains a detailed set of procedural requirements that must be satisfied before an investor may submit a claim to the tribunal. ^{Footnote 171} Of particular importance, CETA requires that the investor withdraw or discontinue, and waive the right to initiate any existing proceedings before a tribunal or court under domestic or international law in regard to the measure alleged to constitute the breach claimed. ^{Footnote 172} CETA seeks to prohibit parallel proceedings by limiting investors’ right to seek remedies in domestic or international tribunals and courts and before the CETA tribunal at the same time.

Generally, investors submit the whole of an investment dispute to the arbitral tribunal. For instance, the presumptive rule under the ICSID Convention is that the “[c]onsent of the parties to arbitration under this Convention shall, unless otherwise stated, be deemed consent to such arbitration to the exclusion of any other remedy.” ^{Footnote 173} NAFTA varied this rule by prescribing that investors could also seek injunctive relief before local courts simultaneously with the arbitral proceedings, so long as they did not claim damages. CETA’s formulation is generally consistent with the approach taken under the ICSID Convention regime, ^{Footnote 174} whereby investors can go to the local courts, but it results in an “either/or” situation: arbitration or local courts, not both simultaneously. ^{Footnote 175} The provisions of Article 8.22(1)(f) and (g) of CETA appear to preclude the possibility of injunctive relief, payment of damages, or other remedies in a second forum. If this is indeed the case, and a claimant may not seek injunctive relief involving the payment of damages in the local courts (or before another international tribunal), then these provisions reflect a change in Canadian investment policies. A claimant would typically not seek injunctive relief before another international tribunal, although could seek interim or provisional measures. It is unsettled whether such measures would equate to the injunctive power of a national court.

CETA provides that the investor has up to ten years to initiate an investment claim over measures that have been the subject of local judicial proceedings (compared to the otherwise applicable three-year limitation period), which might ensure that investors are not penalized for having first sought (or exhausted) remedies before non-CETA courts and tribunals. The prohibition on bringing claims in other forums for the same claims brought under CETA applies both to the investor and to any locally established enterprise that the investor owns or controls directly or indirectly. ^{Footnote 176} However, the requirements of Articles 8.22(1)(f) and (g) and 8.22(2) “do not apply in respect of a locally established enterprise if the respondent or the investor’s host state has deprived the investor of control of the locally established enterprise, or has otherwise prevented the locally established enterprise from fulfilling those requirements.” ^{Footnote 177}

Generally speaking, under older IIAs, the focus was on the investor. The losses claimed could be those suffered directly by the investor or could be a claim for derivative or reflective loss as a result in the diminution of the value of its investment. NAFTA started the trend of differentiating between claims brought by an investor on its own behalf and claims brought by an investor on behalf of the enterprise that it owned or controlled. In the case of the latter type of claim, if damages were awarded, they had to be made payable directly to the enterprise, so as to protect the rights of third-party creditors.

CETA also contains a provision requiring that, in order to submit its claim to the tribunal, the investor “shall not identify a measure in its claim that was not identified in its request for consultations.” ^{Footnote 178} This provision is reflective of the WTO practice that claims must have all been outlined in the request for consultations. CETA’s focus on whether a measure has been identified in the request for consultations (failing which it will be found to fall outside of the tribunal’s terms of reference), is a potential landmine for claimants, which some commentators suggest might “lead to protracted jurisdictional disputes on whether and to what extent the actual claim complies with this formal prerequisite.” ^{Footnote 179} This provision implies that it is not open to a claimant to amend its claim(s), and, therefore, it conflicts with the ICSID Convention rule that allows for ancillary claims to be brought ^{Footnote 180} (a nearly identical provision is available under the ICSID Additional Facility Rules) ^{Footnote 181} and the UNCTRAL rule that permits claims to be amended. ^{Footnote 182}

CETA further states that the tribunal must decline jurisdiction if the investor, or its locally established enterprise, fails to fulfil any of the seven requirements contained in Article 8.22(1). ^{Footnote 183} In the early NAFTA cases, respondents argued that the treaty’s condition precedents to the submission of a claim to the tribunal must be complied with in order to perfect the agreement to arbitrate, but tribunals sometimes dismissed the alleged failures to comply with conditions precedent as de minimus, and insufficient to deprive the tribunal of jurisdiction. ^{Footnote 184} Subsequent Canadian and US treaty-making practice has emphasized the need to comply with conditions precedent and has spelled out the consequences of non-compliance for tribunals. CETA reflects this trend. ^{Footnote 185}

ARTICLE 8.23: SUBMISSION OF A CLAIM TO THE TRIBUNAL

Article 8.23 is another example of an attempt by the parties to modify the applicable arbitral rules to fit within CETA’s unique ITS context. It provides that if a dispute has not been resolved through consultations, an investor of a party may submit a claim either on its own behalf or on behalf of a locally established enterprise that it owns or controls directly or indirectly. ^{Footnote 186} The claimant has the following choice of “rules” under which to bring its claim(s):

• • the ICSID Convention and ICSID Rules of Procedure for Arbitration Proceedings;

• • the ICSID Additional Facility Rules, if the conditions for proceedings pursuant to paragraph (a) do not apply;

• • the UNCITRAL Arbitration Rules; or

• • any other rules on agreement of the disputing parties. ^{Footnote 187}

The choice of arbitral rules clause in CETA reveals that the new ITS process is not a complete departure from the traditional ISDS regime. Apart from the identity of the individual decision makers, several familiar aspects of investor–state arbitration remain, including that claims may still proceed at ICSID or its Additional Facility or under the UNCITRAL Arbitration Rules (or any other agreed rules). However, what remains unclear in CETA is how a permanent investment tribunal of first instance and an appellate mechanism co-exist within the framework of ICSID arbitration that it purports to modify and whether CETA awards will be enforceable under the ICSID Convention and the New York Convention (for non-ICSID cases).

Article 8.23(2)(a), which provides that a claim may be submitted under the ICSID Convention, seems to suggest that the ICSID Convention can apply to any CETA case. An ICSID claim brought by a national of an EU member state is available against Canada, as is any claim by a Canadian national against such an EU member state. However, if the treaty drafters intended to suggest that a CETA claim may be brought against the EU itself under the ICSID Convention, this is not yet legally possible. The EU is a supranational organization, and is thus currently incapable of becoming a contracting state to the ICSID Convention, unless the Convention is amended by unanimity. However, it is conceivable that Article 8.23(2)(a) was phrased to anticipate the aspirational possibility of the ICSID Convention’s amendment to allow for EU accession, but, given that its Article 66 requires unanimity for an amendment to take effect, the prospect seems unlikely. CETA Article 8.23(2)(b) appears to recognize this problem through its departure from the clear formulation in NAFTA. ^{Footnote 188} Canadian investors bringing claims against the EU may still proceed under the ICSID Additional Facility Rules, the UNCITRAL Arbitration Rules, or other such rules as the disputing parties agree.

If the claimant proposes other arbitration rules pursuant to Article 8.23(2)(d), the respondent has twenty days in which to respond to the claimant’s proposal. ^{Footnote 189} However, if the disputing parties have not agreed on such rules within thirty days of receipt of the claimant’s proposal, the investor may then submit a claim only under the ICSID Convention, the ICSID Additional Facility Rules, or the UNCITRAL Arbitration Rules. ^{Footnote 190} CETA clarifies that, “[f]or greater certainty,” a claim submitted by an investor of a party, on behalf of a locally established enterprise that it owns or controls directly or indirectly shall satisfy the requirements of Article 25(1) of the ICSID Convention. ^{Footnote 191} This might be a drafting error. A more accurate reference would have been to Article 25(2)(b) of the ICSID Convention, which deals with the situation of a locally incorporated juridical person that is considered to be a national of another contracting state by reason of foreign control. ^{Footnote 192}

CETA further clarifies that the rules applicable to claims brought under the Investment Chapter are those in effect on the date that the claim is submitted to the tribunal, “subject to the specific rules set out in this Section and supplemented by rules adopted pursuant to Article 8.44.3(b).” ^{Footnote 193} Article 8.44.3(b) provides that the Committee on Services and Investment may, following the agreement of the parties, adopt and amend rules supplementing the applicable dispute settlement rules and that these will be binding on the tribunal. ^{Footnote 194}

A claim is only filed under CETA’s ITS regime when either: (1) the request under Article 36(1) of the ICSID Convention is received by the ICSID Secretary General; (2) the request under Article 2 of Schedule C of the ICSID Additional Facility Rules is received by the ICSID Secretariat; (3) the notice under Article 3 of the UNCITRAL Arbitration Rules is received by the respondent; or (4) the request or notice initiating proceedings is received by the respondent in accordance with the rules agreed as between the parties. ^{Footnote 195} Finally, each party must notify the other party of the place of delivery of notices and other documents by claimants. Consistent with the strong transparency provisions in CETA, the notices must be made publicly available. ^{Footnote 196}

ARTICLE 8.24: PROCEEDINGS UNDER ANOTHER INTERNATIONAL AGREEMENT

In an attempt to limit duplicative proceedings and any potential for abuse of process, CETA limits, through a waiver requirement, the ability of the investor and its locally owned enterprise to bring parallel international or domestic proceedings alongside an investor–state claim under CETA. Investors cannot seek remedies before the domestic courts (or other international tribunals) and CETA’s ITS at the same time. The aim is to avoid double compensation and divergent awards, on account of investors on different levels bringing claims under different treaties. Most of the 3,000 plus IIAs currently in force have no such mechanisms.

Commentators have noted the relative novelty of CETA’s Article 8.24, which expands upon a provision in NAFTA that requires that an investor withdraw or waive their right to pursue certain parallel proceedings. ^{Footnote 197} Article 8.24 provides that where a claim is brought under CETA and another international agreement and:

• • there is a potential for overlapping compensation or

• • the other international claim could have a significant impact on the resolution of the claim brought pursuant to this section, the Tribunal shall, as soon as possible after hearing the disputing parties, stay its proceedings or otherwise ensure that proceedings brought pursuant to another international agreement are considered in its decision, order, or award. ^{Footnote 198}

Accordingly, CETA requires that the tribunal coordinate its consideration of such a claim to take into account any other claim being advanced under another international agreement and potentially to either stay the claim before it or “wait and see” what the other tribunal does.

ARTICLE 8.25: CONSENT TO THE SETTLEMENT OF THE DISPUTE BY THE TRIBUNAL

CETA explicitly confirms the respondent states’ consent to arbitration by the tribunal under the Investment Chapter; a provision that has become commonplace in IIAs. ^{Footnote 199} It is the same provision as in NAFTA. ^{Footnote 200} CETA further clarifies that the respondent’s consent and the submission of a claim to the tribunal satisfies the consent requirements of Article 25 of the ICSID Convention, Chapter II of the ICSID Additional Facility Rules, and Article II of the New York Convention. ^{Footnote 201}

ARTICLE 8.26: THIRD-PARTY FUNDING

CETA imposes a new positive obligation on disputing parties to promptly disclose if they are being aided by third-party funding or donations to finance their claims, ^{Footnote 202} both at the time of a claim as well as throughout the duration of the dispute. ^{Footnote 203} However, the disclosure requirement only obliges the disputing parties to inform members of the tribunal of the name and address of any funder, which would only permit tribunal members to check for conflicts of interest. It can be expected that the mandatory disclosure of such information will play a role in subsequent submissions over potential costs awards, and the desire of respondents to be made whole on any award for costs made against an unsuccessful claimant.

ARTICLE 8.30: ETHICS

Another notable feature of CETA is its inclusion of strongly worded ethics provisions for the members of the tribunal, which address several of the legitimacy criticisms advanced against ISDS in recent years. ^{Footnote 204} States are essentially codifying and elaborating upon long held general notions of independence and impartiality requirements for arbitrators in their treaties, with CETA and the draft EU–Singapore FTA being the first examples of this trend.

CETA addresses the practice of “double-hatting,” where arbitrators act as counsel or experts in other treaty cases where the issues might be the same as those with which they are presented as arbitrators. ^{Footnote 205} Members of the tribunal (and, presumably, the appellate tribunal, although CETA is not clear on this point) will be barred from acting as counsel or party-appointed experts or witnesses in any other investment disputes during their five-year term of appointment to the tribunal. ^{Footnote 206} They are not barred from acting as arbitrators in other cases until the ITS transitions to full-time, provided they remain available to hear CETA cases. The rationale behind this restriction on double-hatting is not surprising as it is one of the long-standing criticisms of investor–state arbitration. Whether perceived or actual, conflicts of interest diminish confidence in the investment arbitration system – a situation that CETA seeks to remedy. ^{Footnote 207} As one critic points out, “it is difficult to understand how anyone can be capable of such extraordinary compartmentalization” where the issues to be decided by an arbitrator are similar or identical to issues in a different case he or she is arguing as counsel. ^{Footnote 208}

Some in the field insist that double-hatting is not only possible, provided arbitrators abide by conflicts of interest principles, but also desirable. ^{Footnote 209} According to proponents of the practice of party-appointed arbitrators, a prohibition on counsel who represent parties in arbitration from serving as arbitrators would reduce the overall pool of potential arbitrators and deprive the parties of the ability to choose as arbitrator those lawyers with deep expertise in the subject matter of the dispute who, for whatever reason, have decided to forego the arbitrator role in favour of that of advocate. These problems would also be exacerbated if a large number of experienced practitioners opt for the often more lucrative advocate’s role. ^{Footnote 210}

CETA elaborates on the ICSID Convention’s requirement that arbitrators (in this case, members of the tribunal) “shall be independent” of the disputing parties by stipulating that they shall “not be affiliated with any government.” ^{Footnote 211} A footnote to this provision further provides that, “[f]or greater certainty, the fact that a person receives remuneration from a government does not in itself make that person ineligible.” The provision then outlines specific examples of an inappropriate connection to a government, namely: (1) taking instructions from any organization or government about matters related to the dispute and (2) participating in the consideration of any disputes that would create a direct or indirect conflict of interest. ^{Footnote 212}

Of particular note, CETA also makes the application of the IBA Guidelines on Conflicts of Interest binding on tribunal members. ^{Footnote 213} This departs from the usual practice that the Guidelines are only binding if the disputing parties so agree. ^{Footnote 214} This will constitute a change for arbitrators. In arbitrator challenge procedures under the ICSID Convention, the IBA Guidelines have been treated as being of some relevance, but a far less important source of guidance than the Convention itself. ^{Footnote 215} Where a member of the tribunal is found not to comply with the Guidelines, he or she will be replaced. ^{Footnote 216} Interestingly, such challenges will be determined by the president of the International Court of Justice (ICJ), ^{Footnote 217} as opposed to the authority specified in the arbitral rules under which the claimant chooses to bring its claims, ^{Footnote 218} or by the remaining members of the division of the tribunal on the case (as is the case in the first instance under the ICSID Convention, where the president of the Administrative Council becomes involved only if the two remaining arbitrators disagree on the challenge or if a challenge involves more than one arbitrator). ^{Footnote 219} In the event of the disqualification or resignation of a member of the tribunal, the vacancy “shall be filled promptly” from the roster of members of the tribunal. ^{Footnote 220}

Article 8.30(3) sets out the time frames for the challenge procedure. The ICJ president must issue his or her decision on the challenge “within 45 days of receipt of the notice of challenge.” The provision is silent as to whether the president may seek an extension of time to render the decision, as well as to whether the decision must include reasons. The draft EU–Vietnam FTA is also silent on this issue, although it is standard practice in the investment treaty context for challenge decisions to be reasoned. The ethics provisions contain two further avenues for removing an arbitrator based on conflicts of interest and/or a lack of independence or impartiality by either: (1) a reasoned recommendation from the president of the tribunal or (2) the parties’ joint initiative for removal by decision of the Joint Committee. ^{Footnote 221}

ARTICLE 8.31: APPLICABLE LAW AND INTERPRETATION

The issue of the applicable law is often one of the most challenging areas in investor–state arbitration, due in part to the skeletal drafting of many older IIAs. Arbitrators have exhibited very different conceptions of the interaction between the law of the host state and the applicable rules of international law. Article 8.31 explicitly sets out the applicable law and rules of interpretation in CETA arbitrations. In rendering its awards, the tribunal must apply CETA “as interpreted in accordance with the Vienna Convention on the Law of Treaties (VCLT), and other rules and principles of international law applicable between the Parties.” ^{Footnote 222} This is similar to the governing law in NAFTA disputes, which provides that it is a public international law dispute. ^{Footnote 223}

The tribunal will not have jurisdiction to determine questions regarding the legality of an impugned measure under the domestic law of the disputing party. ^{Footnote 224} The tribunal (and presumably the appellate tribunal) may have regard to EU, EU member state, and Canadian law purely “as a matter of fact” ^{Footnote 225} and will look to the local law to determine whether certain legal rights have been created. The EC’s “Guide to CETA” cites the following determinations the tribunal might be asked to make: “[W]hether the property rights allegedly expropriated actually exist under the law of the country where the property is” and “whether a measure under domestic law is legal remains the monopoly of the EU and its members States competent authorities, or of Canada.” ^{Footnote 226}

CETA’s applicable law and interpretation provision reserves for the Joint Committee the power to declare a binding interpretation of any provisions of the agreement “[w]here serious concerns arise as regards matters of interpretation that may affect investment.” ^{Footnote 227} The EU has characterized this ability to adopt binding interpretations provisions as “a safety valve in the event of errors by the tribunals (the likelihood of which is in any event greatly reduced by the clear drafting of the relevant investment protection standards).” ^{Footnote 228} This power is not new and was first included in NAFTA some twenty-three years ago. ^{Footnote 229} As already mentioned, the Committee on Services and Investment is empowered to recommend to the Joint Committee the adoption of interpretations of CETA, which must be given binding effect on a tribunal from a specific date (immediate or prospective).

ARTICLE 8.32: CLAIMS MANIFESTLY WITHOUT LEGAL MERIT AND ARTICLE 8.33: CLAIMS UNFOUNDED AS A MATTER OF LAW

Like other recent treaties, CETA contains a fast-track system for rejecting claims that are “manifestly without legal merit” and/or “unfounded as a matter of law”. Investment arbitrations often involve complex and time-consuming factual and legal issues, which can lead to substantial legal costs. In recent years, concerns have been voiced over perceived frivolous and unmeritorious claims that, in the absence of a fast-track system for challenging them would require a full defence to be mounted by respondent states. For these reasons, mechanisms designed to weed out unfounded claims have been included in the 2006 ICSID Arbitration Rules, ^{Footnote 230} the Central America-Dominican Republic Free Trade Agreement (CAFTA-DR), ^{Footnote 231} other US and Canadian treaties, ^{Footnote 232} the Trans-Pacific Partnership (TPP), ^{Footnote 233} in CETA in Articles 32 and 33, and in the draft EU–Vietnam FTA in Article 19. These kinds of provisions can be effective in deterring dubious claims and limiting state’s burdens and expenses in defending themselves by dismissing the case at an early stage. ^{Footnote 234}

States are no doubt seeking to avoid the scenario that arose in the NAFTA case of Methanex Corporation v United States, where the tribunal ultimately dismissed the claim for lack of jurisdiction, but only after the claimant was authorized to replead its case on jurisdiction and the merits, at substantial cost. ^{Footnote 235} This, despite the tribunal having been confronted with the “lack of legal merit” objection three years earlier, in which it concluded that, even accepting all of the claimant’s allegations of fact, the relevant treaty did not afford the tribunal the authority to rule on the United State’s objection that the claims should be dismissed for “lack of legal merit.” ^{Footnote 236} Articles 8.32 and 8.33 in CETA therefore reflect the standard formulation of the power granted to tribunals in most major treaties in the last decade to swiftly dismiss cases for claims manifestly without legal merit and/or claims unfounded as a matter of law.

Pursuant to Article 8.32, the threshold test is whether the claim is manifestly without legal merit. The respondent must file its objection on this ground within thirty days after the tribunal is formed and, in any event, before the first session of the tribunal. ^{Footnote 237} The parties hope that this provision will allow frivolous claims to be thrown out in a matter of weeks. ^{Footnote 238} Under Article 8.33, the threshold test for whether a claim is unfounded as a matter of law is whether it is not a claim for which an award in favour of the claimant may be made, even if the facts alleged were assumed to be true. ^{Footnote 239} This provision is intended to dismiss claims based on facts that, even if fully accepted, are not capable of giving rise to legal claims that are disputable under CETA’s Investment Chapter.

Article 8.33 provides that “unfounded as a matter of law” objections must be submitted to the tribunal no later than the counter-memorial. This would, of course, far exceed the thirty-day deadline for “manifestly without legal merit” objections. ^{Footnote 240} If the respondent has already filed an objection pursuant to Article 8.33, it cannot also then submit one under Article 8.32. The reverse is also true, and the tribunal “may” (but is not obliged to) decline to address the Article 8.33 objection, upon a consideration of the circumstances of that objection. ^{Footnote 241} Any objections filed based on Article 8.32 will be without prejudice to the tribunal’s authority to address other objections as preliminary questions, or to the right of the respondent to object, in the course of the proceeding, that a claim lacks legal merit. ^{Footnote 242}

Importantly, upon receipt of an objection, the tribunal must suspend the arbitral proceedings. In this regard, the provisions seem to herald a return to the pre-2006 situation under the ICSID Arbitration Rules where the filing of an objection to jurisdiction led to the suspension of the proceeding. The 2006 rules made suspension a matter of discretion for the tribunal. After giving the disputing parties an opportunity to present their submissions, the tribunal is expected to render its decision regarding claims alleged to be “manifestly without legal merit” at its first session (or promptly thereafter) and to issue a decision or award with reasons. ^{Footnote 243} For claims “unfounded as a matter of law,” the tribunal must establish a schedule for considering the objection (like it would for any other hearing of a preliminary question) and issue a decision or award on the objection, stating its reasons. ^{Footnote 244}

Arbitral tribunals have construed the meaning of “manifestly without legal merit” and “unfounded as a matter of law” on a case-by-case basis. ^{Footnote 245} In the ICSID arbitration Trans-Global Petroleum v Jordan, the tribunal stated that a claim is without legal merit when it concerns “infringements of non-existent legal rights of the Claimant or non-existent legal obligations of the Respondent.” ^{Footnote 246} With regard to the “manifest” requirement, the same tribunal concluded that the “word requires the respondent to establish its objection clearly and obviously, with relative ease and dispatch. The standard is thus set high.” ^{Footnote 247} CETA does not make clear to what extent the two distinct proceedings under Articles 8.32 and 8.33 differ from, and interrelate to, one another. However, since both provisions are not wholly new, decisions rendered under similar provisions in other IIAs may assist a CETA tribunal in developing its approach to the two provisions.

ARTICLE 8.34: INTERIM MEASURES OF PROTECTION

Like NAFTA, CETA’s ITS contemplates the possibility of interim measures of protection. The NAFTA parties recognized the general power to grant such measures to allow for the orderly conduct of the arbitration, but did not permit the tribunal to attach or enjoin the application of the measure alleged to constitute a breach in the claims submitted to it. This is now standard US and Canadian treaty-making practice, and CETA follows the same approach.

ARTICLE 8.35: DISCONTINUANCE

CETA’s discontinuance clause reflects a standard formulation, but it is unclear how it comports with existing arbitral rules that allow the respondent to seek its costs when the claimant ceases to pursue its claims. If the investor fails to take any steps in the proceeding during 180 consecutive days (or such periods as the disputing parties may agree), an investor is deemed to have withdrawn its claim and to have discontinued the proceeding. ^{Footnote 248} At the request of the respondent, the tribunal must then give notice to the disputing parties and proceed to issue an order noting the discontinuance. ^{Footnote 249} The tribunal becomes functus officio upon the issuance of a discontinuance order. ^{Footnote 250}

ARTICLE 8.36: TRANSPARENCY OF PROCEEDINGS

CETA’s transparency provision adopts a modified version of the 2013 UN Convention on Transparency in Treaty-based Investor-State Arbitration (Transparency Convention), which cannot be waived by the tribunal or by the disputing parties. In so doing, CETA is an example of states seeking to harmonize the procedural, and in some cases substantive, aspects of claims, irrespective of the claimant’s choice of the applicable arbitration rules. ^{Footnote 251} This is particularly evident in the strongly worded provisions on transparency, open hearings, and public access to documents.

The great majority of older IIAs, including ones to which the EU member states are signatories, do not even address transparency in investor–state arbitration, let alone make it compulsory. ^{Footnote 252} Similarly, NAFTA allows claimants to bring their claims under the ICSID Arbitration Rules, the 1978 ICSID Additional Facility Arbitration Rules, and the 1976 UNCITRAL Arbitration Rules, none of which provide for transparency of proceedings in the sense now understood. Those rules permit a disputing party to control who attends the hearings (and, thus, permits a party to veto open hearings) as well as to preclude the award’s publication. In the early NAFTA cases, tribunals tended to restrict the publication of case-related information. In Metalclad Corporation v Mexico, although dispute-related information could be published, the tribunal appealed to the parties to keep it to a minimum to avoid inflaming the dispute. ^{Footnote 253} After complaints of non-transparent proceedings grew, various steps were taken by tribunals and the NAFTA parties themselves to provide for greater transparency. In Methanex, the tribunal allowed amicus curiae submissions and, with the disputing parties’ consent, held open hearings for the first time. ^{Footnote 254} In response to public criticism, Canada and the United States accepted the idea of public hearings and the publication of key case-specific documents and began to include rules regulating third-party interventions, open hearings, and public access to documents in subsequent treaties. This trend has continued in such treaties as CAFTA-DR, US–Singapore FTA, TPP, and draft EU–Singapore FTA. ^{Footnote 255}

CETA requires the following classes of documents to be made available to the public: (1) the request for consultations; (2) the notice requesting a determination of the respondent (for claims involving the EU or a member state); (3) the notice of determination of the respondent; (4) the agreement to mediate; (5) the notice of intent to challenge a member of the tribunal; (6) the decision on a challenge to a member of the tribunal; and (7) the request for consolidation. ^{Footnote 256} Exhibits must also be made available to the public, pursuant to the UNCITRAL Transparency Convention. ^{Footnote 257} Consistent with the approach taken in other treaties that have adopted broad transparency, CETA ensures that sensitive information (such as business proprietary information and information considered confidential under the national laws of the respondent) will be protected from disclosure. ^{Footnote 258}

Under CETA, a disputing party may not object to open hearings. All hearings will be open to the public. ^{Footnote 259} However, the tribunal shall make appropriate arrangements to hold in private parts of the hearings where there is a need to protect confidential or protected information. ^{Footnote 260} The respondent may communicate to the public information that it is required to disclose publicly by its laws, but must do so “in a manner sensitive to protecting from disclosure information that has been designated as confidential or protected.” ^{Footnote 261}

ARTICLE 8.37: INFORMATION SHARING

Article 8.37 introduces a relatively new obligation, not previously articulated in any treaty text, to protect redacted documents if the disputing parties share them with other people in connection with the proceedings. A disputing party must only disclose to other persons in connection with the proceedings and/or officials of the EU, EU member states, and subnational governments (of either party) “such unredacted documents as it considers necessary in the course of proceedings.” ^{Footnote 262} The disputing party must “ensure that those persons protect the confidential or protected information contained in those documents.” ^{Footnote 263}

ARTICLE 8.38: NON-DISPUTING PARTY

CETA contains tiered disclosure requirements by the respondent, within thirty days after receipt, to the non-disputing state party. This is standard Canadian practice since NAFTA. First, the respondent must provide to the non-disputing party the request for consultations, the notice requesting a determination of the respondent, the notice of determination of the respondent, the claim submitted pursuant to Article 8.23, any request for consolidation, and any other documents that are appended to such documents. ^{Footnote 264} Second, if requested, the respondent must provide to the non-disputing party: pleadings, memorials, briefs, requests, and other submissions made to the tribunal by a disputing party; written submissions regarding Article 4 of the Transparency Convention; minutes or transcripts of hearings, if available; and orders, awards, and decisions of the tribunal. ^{Footnote 265} Further, if requested and at the cost of the non-disputing party, the respondent must provide to the non-disputing party all of the evidence that has been tendered to the tribunal, unless it is publicly available. ^{Footnote 266}

As an additional safeguard, CETA provides that the tribunal may, after consultation with the disputing parties, invite submissions from the non-disputing party regarding the interpretation of particular provisions. ^{Footnote 267} This is reflective of NAFTA Article 1128 and demonstrates the importance of the parties’ influence and control over how the agreement is interpreted, even where they are not a party to the dispute. CETA explicitly states that the tribunal may not draw any inference from the absence of a submission from a non-disputing party. ^{Footnote 268} However, where a non-disputing party makes a submission, the tribunal must ensure that the disputing parties are given a reasonable opportunity to present their observations on that submission. ^{Footnote 269}

ARTICLE 8.39: FINAL AWARD

Like NAFTA, ^{Footnote 270} CETA gives the respondent the choice of whether to make restitution or pay damages. ^{Footnote 271} CETA does not force restitution but, rather, recognizes that restitution can be an appropriate way of resolving the dispute. The award must also be made without prejudice to a right that a person, other than a person that has provided a waiver pursuant to Article 8.22 [parallel proceedings in domestic courts or other international tribunal], may have in monetary damages or property awarded under a Party’s law.” ^{Footnote 272} Further, the tribunal may not award monetary damages in an amount greater than the loss suffered by the investor/locally established enterprise and must reduce this amount by prior damages, compensation already provided, or any restitution of property or repeal/modification of a measure. ^{Footnote 273} Notably, punitive damages are not permissible under CETA. ^{Footnote 274}

CETA’s formulation of how the tribunal must apportion the costs of the proceedings is novel and will likely have an important economic impact for parties in CETA disputes and future treaty drafters alike. Article 8.39(5) of CETA provides that the tribunal’s cost rulings shall follow the event (namely, the “loser pays principle”), such that all reasonable costs (including legal fees) will be borne by the losing party, which is rare in international investment arbitration. CETA stipulates that only in “exceptional circumstances” may the tribunal apportion the costs between the disputing parties “if it determines that apportionment is appropriate in the circumstances of the claim.” ^{Footnote 275} Of course, if only parts of the claims have been successful, the costs shall be adjusted, proportionately, to the number, or extent of the successful parts, of the claims. ^{Footnote 276} Further, the Joint Committee is empowered to implement supplemental rules aimed at reducing the financial burden on claimants who are natural persons or SMEs, taking into account the claimant’s financial resources and the amount of compensation sought. ^{Footnote 277}

A tribunal must issue its final award within twenty-four months of the date on which the claims were submitted and is obliged to exercise best efforts to ensure that the dispute is resolved in a timely manner. ^{Footnote 278} Should it require additional time to issue its award, it must provide the disputing parties with reasons for the delay. ^{Footnote 279} CETA is silent as to the consequences of the tribunal either: (1) not providing reasons for its delay and/or (2) not delivering its award within the twenty-four-month period. This lacuna in the otherwise detailed and precise language employed in CETA prompts the question of whether a failure by a tribunal to render the award within twenty-four months would make the award susceptible to appeal.

CETA’s time period within which to issue a final award, and get it right on the facts and the law, is unduly short, particularly when considering investor–state arbitration experience over the last thirty years, the increased detail in which the parties have drafted the investment protections, and the new threat to tribunals being reversed on appellate review. The EC has acknowledged that the average duration of arbitral proceedings under existing investment treaties is three to four years. ^{Footnote 280} ICSID noted in its 2015 annual report that the average duration of its arbitral proceedings from the date of constitution of the tribunal to an award is thirty-nine months. ^{Footnote 281} If bi- or tri-furcation of the proceedings is requested by one of the disputing parties or ordered on the division’s own initiative, this will delay the proceedings even further. The process of preparing two rounds of pleadings, together with witness statements and expert reports, along with requests for document production, not to mention the time in which the tribunal requires to digest the evidence and the parties’ submissions in order to formulate its award, will almost certainly take the case beyond the twenty-four month time limit.

ARTICLE 8.40: INDEMNIFICATION OR OTHER COMPENSATION

The indemnification or other compensation clause in CETA reflects a standard formulation that appears in other IIAs. Article 8.40 provides that a respondent may not counterclaim, or assert a right of setoff, for the amount that an investor/locally established enterprise has, or will, receive pursuant to an insurance or guarantee contract in regard to the compensation sought in a dispute. ^{Footnote 282} This closely hews to the equivalent provision of NAFTA. ^{Footnote 283}

ARTICLE 8.41: ENFORCEMENT OF AWARDS

In line with other IIAs, CETA awards are binding between the disputing parties ^{Footnote 284} and must be complied with without delay after becoming final. ^{Footnote 285} In the case of an ICSID Convention award, CETA stipulates that a disputing party may not seek enforcement of a final award until either 120 days have elapsed from the date the award was rendered and no disputing party has requested revision or annulment of the award or enforcement of the award has been stayed and revision or annulment proceedings have been completed. ^{Footnote 286} This provision is transitional. As soon as the organizational matters with respect to the appellate tribunal are addressed in Article 8.28(7), the provisions of Article 8.41(3) will cease to be operational, as per Article 8.28(9). Thereafter, all that is left in Article 8.41 are the provisions about bindingness, compliance, and characterization for the purposes of the ICSID Convention and the New York Convention.

If the final award is rendered under the ICSID Additional Facility Rules, the UNCITRAL Arbitration Rules, or any other rules, a disputing party may not seek enforcement of a final award until ninety days have elapsed from the date the award was rendered, and no disputing party has commenced a proceeding to revise, set aside, or annul the award or enforcement of the award has been stayed and a court has dismissed or allowed an application to revise, set aside, or annul the award, and there is no further appeal. ^{Footnote 287} As is the case with the ICSID Convention, ^{Footnote 288} the execution of a final award will be governed by the laws of the country in which the enforcement of the award is sought. ^{Footnote 289} Further, CETA clarifies the intent of Canada and the EU that a final award “is an arbitral award that is deemed to relate to claims arising out of a commercial relationship or transaction for the purposes of Article I of the New York Convention” ^{Footnote 290} and, thus, is to be treated as a usual arbitral award under the New York Convention (notwithstanding that the EU is not a member of this convention).

CETA explicitly provides that “[f]or greater certainty” if a claim is submitted under the ICSID Convention, then a final award shall qualify as an award of the ICSID Convention. ^{Footnote 291} As discussed earlier in this treaty comment, it is unclear whether this formulation seeks to address only the situation where an EU member state is the respondent in the proceedings or whether the EU intends to become a party to the ICSID Convention. While the parties may be able to vary the ICSID Convention between themselves, they cannot require compliance to their modification from other ICSID contracting states.

ARTICLE 8.42: ROLE OF THE PARTIES

CETA appears to leave open the possibility to have state-to-state arbitration alongside investor–state arbitration where “the other Party has failed to abide by and comply with the award rendered in that dispute.” ^{Footnote 292} This does not exclude the possibility of state-to-state dispute settlement under Chapter 29 of CETA with respect to a measure of general application, even if that measure is alleged to have breached CETA in regard to a specific investment in which a claim has been submitted to the ITS. ^{Footnote 293} Notwithstanding the prohibition of international claims in respect of claims filed under the Investment Chapter, informal exchanges for the sole purpose of facilitating a settlement of the dispute are permissible. ^{Footnote 294}

ARTICLE 8.43: CONSOLIDATION

The consolidation provisions are yet another example of an area where CETA modifies and supplements existing arbitral rules. CETA provides detailed provisions on consolidation of two or more claims, following the approach in NAFTA Article 1126. In contrast, the UNCITRAL Arbitration Rules, the ICSID Convention, and the ICSID Additional Facility Rules do not provide for the consolidation of claims. To date, consolidation under the ICSID Aribtration Rules and the ICSID Additional Facility Rules has been done consensually. The proliferation of IIAs that provide for investor–state arbitration has raised the risk of multiple and conflicting awards, as the same dispute can lead to awards under different treaty regimes, as well as under different contracts. Investors are sometimes able to claim breaches of different IIAs and to seek relief through different arbitration proceedings under each of the invoked treaties, in regard to a single investment and regarding the same facts.

Accordingly, CETA provides that, where two or more claims submitted separately to the ITS have a common question of law or fact and arise out of the same events or circumstances, a disputing party/parties may jointly seek the establishment of a separate division of the tribunal to issue a consolidation order. ^{Footnote 295} First, the disputing party seeking a consolidation order must deliver a notice to the other disputing parties it seeks to cover with this order. ^{Footnote 296} If the disputing parties so notified agree to the consolidation request, they may jointly request that a separate division of the tribunal be established and that it render a consolidation order. ^{Footnote 297} If the disputing parties object to the consolidation request, then a disputing party has thirty days within which to make a request for the establishment of a separate division of the tribunal and a consolidation order. ^{Footnote 298}

The form of the request for consolidation must take the following form: (1) it must be delivered, in writing, to the president of the tribunal and to all of the disputing parties sought to be covered by the order; (2) it must specify the names and addresses of the disputing parties; the claims; and the grounds for the order sought. ^{Footnote 299} Where more than one respondent is the subject of a request for consolidation, all such respondents must agree to the request. ^{Footnote 300}

CETA sets out the following process for determining the rules applicable to the proceedings if and when they are consolidated:

1. (a) if all of the claims for which a consolidation order is sought have been submitted to dispute settlement under the same rules pursuant to Article 8.23, these rules shall apply;

2. (b) if the claims for which a consolidation order is sought have not been submitted to dispute settlement under the same rules:

   1. (i) the investors may collectively agree on the rules pursuant to Article 8.23.2; or

   2. (ii) if the investors cannot agree on the applicable rules within 30 days of the President of the Tribunal receiving the request for consolidation, the UNCITRAL Arbitration Rules shall apply. ^{Footnote 301}

The request for consolidation must be heard by a new “consolidating division” of the tribunal, which is selected by the president of the tribunal. ^{Footnote 302} If, after hearing the disputing parties, a consolidating division is satisfied that the claims have a question of law or fact in common and arise in the same events or circumstances and that consolidation would best serve the interests of fair and efficient resolution of the claims, including the interest of consistency of awards, the consolidating division may, by order, assume jurisdiction over some or all of the claims, in whole or in part. ^{Footnote 303}

ARTICLE 8.44: COMMITTEE ON SERVICES AND INVESTMENT

CETA gives considerable authority to the Committee on Services and Investment to refine the operation of the Investment Chapter. ^{Footnote 304} The committee is a forum for the parties to consult on issues related to the implementation and possible improvements of the ITS mechanism, ^{Footnote 305} and it is empowered to issue binding interpretations of the standards of treatment outlined in the Investment Chapter, which will undoubtedly refine and limit their application. ^{Footnote 306} The committee may also make recommendations with respect to the proper functioning of the appellate tribunal. ^{Footnote 307}

Notably, the committee is also obliged to adopt a code of conduct for the members of the tribunal, which will address disclosure obligations, the independent and impartiality of the members of the tribunal, and confidentiality. ^{Footnote 308} This provision also includes a best efforts obligation on the parties “to ensure that the code of conduct is adopted no later than the first day of the provisional application or entry into force of this Agreement” and within a maximum of two years. CETA’s aspirational deadline for the codification of a set of ethical rules to govern the members of the tribunal is yet another novel feature of CETA.