Series
Blogs
Series
Blogs
UNCITRAL’s Working Group III recently completed its draft Code of Conduct for Arbitrators as part of its work to reform investor-State dispute settlement. This marks a key milestone for the Working Group which was mandated with the task of drafting proposals to reform investor-State dispute settlement back in 2017.
The draft Code focuses on the independence and impartiality of arbitrators, broadens the disclosure requirements on them and regulates the practice of “double-hatting”, the practice of arbitrators acting concurrently as counsel or experts in other investor-State dispute settlement cases. As to the latter, the draft Code stops short of prohibiting double-hatting but proposes that, unless the disputing parties agree otherwise, arbitrators in one case cannot serve as a legal representative or expert witness in another involving the same measure(s), the same or related parties or the same provision(s) of the same instrument of consent. The proposed period of prohibition is three years except in cases involving the same provisions of the same instrument of consent where the prohibition period will be one year. This reduced period is a result of the compromise that was agreed following concerns that a longer cooling-off period for proceedings involving the same provisions of the same instrument of consent could result in a reduced pool of legal representatives and experts, particularly in relation to multilateral investment treaties.
The draft code of conduct for arbitrators is only one component of this phase of the reform work. Working Group III has also completed a draft code of conduct for judges in a standing mechanism, i.e. those sitting on a permanent investment court, although a standing mechanism is itself a reform under review by the Working Group so it is recognised that potential modifications to the code might be necessary in future.
Additionally, the Working Group looked at methods by which investor-State disputes may be resolved more quickly and cost-effectively. To that end it has completed draft provisions on mediation with the potential to be included by States in, inter alia, bilateral and multilateral investment treaties, domestic legislation governing the use of mediation and investment contracts. These include a provision that either encourages or requires parties to engage in mediation as a mechanism to achieve amicable resolution of international investment disputes and a provision that commencement of mediation would automatically stay arbitration or other proceedings without the need for a separate agreement between the parties.
The texts developed by the Working Group will be presented to UNCITRAL at its 56th annual session to be held in Vienna from 3-21 July 2023, where they are expected to be adopted. UNCITRAL published a press release announcing its progress and the draft texts can be found here.
10 May 2023
Up next