Pro-Arbitration Revisited Complete

“PRO-ARBITRATION” REVISITED
A Tribute to Professor George Bermann

from his Students Over the Years
Editors
Elora Neto Godry Farias
Gino Rivas
Gustavo Favero Vaughn
Mateo Verdías Mezzera
along with
Kabir Duggal
Foreword by
Dean Gillian Lester
JURIS
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TABLE OF CONTENTS
Preface .............................................................................................................................. xv
Foreword.......................................................................................................................... xix
About George A. Bermann ......................................................................................... xxi
About the Editors .......................................................................................................... lix
Part I - Faculty in International Arbitration

Chapter 1
Consensual Justice: Challenges and Promises ...........Alejandro M. Garro 3
Chapter 2
How Would a Future WTO Agreement on Investment Facilitation for
Development Encourage Sustainable FDI Flows, and How Could
it Be Further Strengthened? ............................................. Karl P. Sauvant 15
Chapter 3
The New Invisible College ........................................................ Patrick Pearsall 33
Chapter 4
Beat the BITs: Delineating the Monopoly on the Interpretation of
EU Law and its Implications
.......................................................... Petros C. Mavroidis and Kabir Duggal 35
Chapter 5
Promoting Efficiency Is Pro-Arbitration ................................. Rahim Moloo 41
Chapter 6
Being ‟Pro-Arbitration”: Insights from the European
Union’s Approach Towards Investor-State
Arbitration .................................. Ridhi Kabra and Gaëtan Verhoosel KC 47
Chapter 7
Pro-Bermann .......................................................................................... Robert Smit 55
Chapter 8
Professor George Bermann: A Pathway to International
Arbitration ........................................................................Viren Mascarenhas 57
iii
iv TABLE OF CONTENTS
Part II – Former Students in International Arbitration

Chapter 9
Securing International Arbitration’s Domestic
Foundations ....................................................................Adam J. DiClemente 63
Chapter 10
A Reflection on BG Group v. Argentina, in Five
Acts ...................................................................................... Alexander A. Yanos 69
Chapter 11
Being Pro-Arbitration in Anti-Arbitration Situations
.................................................................................................. Alexander Grimm 73
Chapter 12
How to Be Pro-Arbitration in Five Lessons .......... Alexandre Senegacnik 81
Chapter 13
‟Pro-Arbitration” in an Investor-State Context: Is the Dutch Model
BIT ‟Pro-Arbitration”? ................................................. Ana Martinez Valls 87
Chapter 14
Temporal Dimensions of “Pro-Arbitration”
Trade-Offs ............................................................................... Anika Havaldar 93
Chapter 15
Security for Costs: Facially Anti-Arbitration But Upon Consideration
Decidedly Pro-Arbitration
.................................................. Ank Santens and Stephen Hogan-Mitchell 97
Chapter 16
Pro-Arbitration = Pro-Litigation........................................... Anton Chaevitch 105
Chapter 17
Mass Arbitrations: A Pro-Arbitration Approach or Abuse
of Arbitration? ............................................................... Ashlesha Srivastava 109
Chapter 18
Another Aspect of “Pro-Arbitration”:
Enforcement ........................................................................ Brenda D. Horrigan 115
Chapter 19
Brazilian Arbitration-Friendliness
..................................... Caetano Berenguer and Gustavo Favero Vaughn 119
TABLE OF CONTENTS v
Chapter 20
The “Gateway” Issues in Brazil: A Tribute to George A. Bermann
.............................. Camila Macedo Simão and Elora Neto Godry Farias 127
Chapter 21
Are the Essential Actors and Users of Arbitration
Pro-Arbitration? ............................................................. Camilla Gambarini 137
Chapter 22
What Does it Mean to Be “Pro-Arbitration?” Overcoming
the “Pro-State” v. “Anti-State” Dichotomy In Sovereign Debt
Disputes ........................................................................................ Carla Martini 141
Chapter 23
Clarity, Transparency and Unambiguousness: The Pro-Arbitration
Sine Qua Non .................................Chiara Cilento and Rodolfo Donatelli 145
Chapter 24
“In Mitas Virtus”: The Necessary Balance Between the Duty to
Protect the Parties’ Procedural Rights and the Need to
Promote an Agile and Cost-Effective Arbitration
................................................................................... Christian Herrera Petrus 149
Chapter 25
The Benefits of a Judicial Re-Hearing of Jurisdictional
Objections ............................................................. Christina Cathey Schuetz 153
Chapter 26
How Are Arbitration Privacy and Confidentiality Provisions
“Pro-Arbitration”?................................................................... Claire Hellweg 159
Chapter 27
Legitimacy as a Measure of Arbitration-Friendliness
..................................................................................................... Clemens Treichl 163
Chapter 28
Are DC Courts Pro-Arbitration? ................................................ Craig D. Gaver 167
Chapter 29
A Pro-Arbitration Approach: Reflections from the Arbitrator’s
Perspective ................................................................ Cristián Conejero Roos 171
Chapter 30
Can Anti-Arbitration Injunctions Be Pro-Arbitration? ...... Daniel Allman 179
vi TABLE OF CONTENTS
Chapter 31
Pro-Arbitration Approach to Costs Adjustments .................Daniel Hrčka 183
Chapter 32
The Hidden Pro-Arbitration Nature of Judge Rakoff’s Decision on
Arbitral Subpoenas to Third Parties .......................... Daniel Schimmel 189
Chapter 33
A Sociology of Being Pro-Arbitration: A Look at Some Community
Rituals Through the Pro-arbitration Lens ............ David S. Blackman 193
Chapter 34
Chasing Shadows: Enforcement of International Commercial
Arbitral Awards Against Non-Signatories at the Post-Judgment
Stage ................................................................................... Delyan M. Dimitrov 199
Chapter 35
Operationalizing the FAA’s “Pro-Arbitration” Policy: Towards
a Normative Basis for the Duty to Arbitrate in Good
Faith .......................................................................................................... E Jin Lee 205
Chapter 36
Is Appellate Review Pro- or Anti-Arbitration? ...............Eduardo Grebler 211
Chapter 37
Will We Make Arbitration a Victim of its Own
Success? ............................................................................ Ellen-Louise Moens 217
Chapter 38
Does it Still Make Sense to Speak of Being “Pro”
Arbitration? ............................................................................... Enikő Horváth 223
Chapter 39
What Does it Mean to Be ”Pro-Arbitration”? A Take on
Guatemala .......................................................... Enrique Martinez Guzman 229
Chapter 40
Reading Between the Lines, or How I Read My First 4000-Page
Treatise ..................................................................................... Eric Lenier Ives 231
TABLE OF CONTENTS vii
Chapter 41
Short Reflections on the Pro-Arbitration Character of a Pre-Dispute
Waiver of the Right to Appeal a Judgment Confirming or Vacating
an Arbitration Award and of the Right to Resist Recognition and
Enforcement Under Article V(1) of the New York Convention
.................................................................................Erico Bomfim de Carvalho 235
Chapter 42
Is Arbitration Still “Friendly” for the Resolution of Disputes? –
A Reflection in Light of Efficiency and Due Process Concerns
in International Arbitration ............................................. Esra Ogut Oehri 241
Chapter 43
The False Prophets of International Arbitration ................. Florian Grisel 245
Chapter 44
Comparing Arbitration to Judicial Litigation: Assets and
Challenges .................................................................................. Freya Baetens 251
Chapter 45
‟Pro-Arbitration”: The Necessary Presence of Courts at the End
of the Road ......................................................................................... Gino Rivas 257
Chapter 46
Awards and Peace: Arbitration of International
Conflicts ..................................................Guled Yusuf and Andrew Hashim 265
Chapter 47
The Enduring Arbitral Legacy of Professor George
Bermann ................................................................................ Gustavo Laborde 271
Chapter 48
Confidentiality in Arbitration: Is it “Pro-Arbitration”?
....................................................................... Jack Busby and Rebecca Collins 273
Chapter 49
Navigating Value Trade-Offs: International Arbitration and
Beyond ...................................................................................... Janet Whittaker 279
Chapter 50
Comment on “What Does it Mean to Be ‘Pro-Arbitration’?” by Professor
George Bermann........................................................... Jean Marie Lambert 285
viii TABLE OF CONTENTS
Chapter 51
What Does it Mean to Be ”Pro-Arbitration”? A Due Process
Analysis ............................................................ José Manuel García Represa 289
Chapter 52
Presumptive Confidentiality in Arbitration Rules........Joseph E. Neuhaus 295
Chapter 53
International Arbitral Authority as an Act of Collective
Imagination ............................................................................... Joshua Karton 299
Chapter 54
Deregulating Arbitration Might Ultimately Fail to Promote
It ..................................................... Juan Manuel Rey Jiménez De Aréchaga 307
Chapter 55
The Importance of Aspirational Standards of Civility in International
Proceedings .................................... Julie Bédard and Nicholas Romanoff 311
Chapter 56
Waiver of the Right To Arbitrate—Is U.S. Law
“Pro-Arbitration”?........................... Katharine Menéndez De La Cuesta 317
Chapter 57
What Is it to Be ‟Pro-Arbitrationˮ When Addressing
Corruption at the Setting Aside and Enforcement
Stages? ................................................ Laura Azaria and Vincent Reynaud 323
Chapter 58
The Negative Effect of the Competence-Competence
Principle in France: Twelve Years Later ....................Laura Fadlallah 329
Chapter 59
Solving Outer Space Disputes Through Space
Arbitration ................................................................ Laura Yvonne Zielinski 335
Chapter 60
Switzerland’s Steadfast Pro-Arbitration Stance............... Laurence Burger 341
Chapter 61
Towards a More Perfect Union: The Evolution of the American
Pro-Arbitration Policy..................................................Levon Golendukhin 345
TABLE OF CONTENTS ix
Chapter 62
Was the U.S. Supreme Court Decision in ZF Automotive
‟Pro-Arbitrationˮ?.................................................................... Lorenzo Sordi 351
Chapter 63
Section 1782 Discovery in International Arbitration
................................................................................................... Manuel Valderrama 357
Chapter 64
Why Is Arbitration Good for Small States? ........................ Maria Vizdoaga 363
Chapter 65
The Uruguayan “Pro-Arbitration” Notion ........... Mateo Verdías Mezzera 367
Chapter 66
Are Comity and Sovereignty Over Natural Resources Legitimate
Considerations when Applying the Public Policy Exception
to Enforcement of Arbitral Awards? ...................... Matthew E. Draper 373
Chapter 67
ISDS in a Developing Country Context - Implementability and
Implementation as ”Pro-Arbitration” Virtues
................................................................................... Maximilian Philip Eltgen 379
Chapter 68
What Does it Mean to Be “Pro-Arbitration”?: Reflections on
Professor George Bermann’s Legacy, in the Context of
Judicial Intervention in Singapore ...................................... Meera Rajah 385
Chapter 69
Enhanced Transparency: Threat to Arbitration or Pro-Arbitration
Endeavor? ....................................................Mercédeh Azeredo da Silveira 391
Chapter 70
George Bermann and the Importance of Thinking About Arbitration
Contextually ................................................................ Michael A. Fernández 397
Chapter 71
International Arbitration and Political Legitimacy ... Michael Paul Bannon 401
Chapter 72
Becoming “George”...................................................................... Michael Granne 405
x TABLE OF CONTENTS
Chapter 73
The Stop-and-Go Rise of France’s Pro-Arbitration Regime:
A Play in Five Acts................................................................ Mikaël Schinazi 407
Chapter 74
Pro (Domestic) Arbitration But Anti (International)
Arbitration? Complexities in a Dualist Model
Jurisdiction ....................................................... Milton Gutcovsky Kujawski 415
Chapter 75
Pro-Arbitration Concept: Reflections on French Arbitration
Law .............................................................................................. Morgan Imbert 421
Chapter 76
Being ‟Pro-Arbitrationˮ – What Does it Mean for the Applicable
Law?.............................................................................................. Moritz Renner 429
Chapter 77
Doctrinal Coherence as a “Pro-Arbitration” Virtue .............. Myron Phua 433
Chapter 78
International Arbitration’s Section 1782 Conundrum
......................................................................................................Nicolas Teijeiro 441
Chapter 79
Arbitration’s Durability: Meeting Needs in a Changing
Landscape .................................................................................. Nika Madyoon 445
Chapter 80
Searching for Balance in Judicial Treatment of Arbitral Awards
Set Aside at the Seat ...................................................Nikolay A. Ouzounov 451
Chapter 81
Is Remote Arbitration Pro-Arbitration? ..................................... Paris Aboro 457
Chapter 82
Pro-Arbitration Is Regulation ......................................... Parvan P. Parvanov 463
Chapter 83
What Does it Mean to Be “Pro-ISDS”?................................... Perry S. Bechky 467
Chapter 84
Out of Balance: How California Gets Who Decides Non-Signatory
Arbitrability Wrong.......................................................................... Peter Fox 473
TABLE OF CONTENTS xi
Chapter 85
Professor Bermann and the Proskauer Lecture ...........Peter J. W. Sherwin 479
Chapter 86
Reflections on the Progressive Development of Investment
Arbitration to Meet Climate Change and ESG Imperatives
.................................................................................................... Preeti Bhagnani 483
Chapter 87
Pro-Arbitration? A Question of “Legality,” “Effectiveness” and
“Legitimacy” ...........................................................................Quentin Declève 487
Chapter 88
Being Taught to Think Critically About What Is Good for
Arbitration .................................................................................... Quinn Leary 493
Chapter 89
Pro-Arbitration or Not: The Attorney-Eyes-Only
Mechanism ....................................................................................... Rachel Ong 497
Chapter 90
What Does it Mean to Be Pro-Arbitration – An Examination
of Pakistani Judiciary’s Approach ........................................ Rana Sajjad 503
Chapter 91
The Tension Between Confidentiality and Transparency in
Arbitration ......................................................... Ricardo Ampuero Llerena 505
Chapter 92
Maximizing the Economic Benefits Produced by International
Commercial Arbitration: Beyond “Pro-Arbitration” Policies
..................................................................................................... Riccardo Loschi 511
Chapter 93
An Appreciation of George A. Bermann ................... Richard L. Mattiaccio 517
Chapter 94
Indian Arbitration – The Illusion of a ‟Pro-Arbitrationˮ
Development .............................................. Rishab Gupta and Lakshana R 521
Chapter 95
Being “Pro-Arbitration”: An Italian Perspective ............... Roberto Casati 525
xii TABLE OF CONTENTS
Chapter 96
The Arbitration State: From Autonomy to
Independence ...................................................................... Rumen Cholakov 531
Chapter 97
Pro-Arbitration and “Pro Validitate”: Is it Always The Same?
Some Reflections in Light of Swiss and French Law
................................................................................................... Sébastien Besson 537
Chapter 98
“Aggregate Arbitration” – Or the Question of Whether Issue
Preclusion Principles Are “Pro-Arbitration”............. Silja Schaffstein 545
Chapter 99
“Pro-Arbitration” in an Investor-State Context:
Assignment of Investment Treaty Claims
................................................................................... Simón Navarro Gonzalez 551
Chapter 100
Selected Pro-Arbitration Features of the Swiss Lex Arbitri
.................................................................................................. Simon Vorburger 561
Chapter 101
Party Autonomy, Courts’ Intervention and “Pro-Arbitration”
Policy: A Concatenation of Concepts Towards Arbitral
Efficacy? ................................................................................... Tolu Obamuroh 565
Chapter 102
Artificial Intelligence Arbitration ....................................... Tyler Jankauskas 573
Chapter 103
International Commercial Arbitration and Climate Emergency:
In Search of “Greener” Times ........................................ Valentin Rougier 577
Chapter 104
What Does it Mean to Be ”Pro-Arbitration”?: Effectuating Party
Intent in Construing an Arbitration Agreement.......... YiKang Zhang 583
Chapter 105
A “Pro-Arbitration” Framework for Choice-of-Law Practices in U.S.
Judicial Enforcement of Arbitration Agreements ...... Yilin Tim Chen 591
TABLE OF CONTENTS xiii
Chapter 106
Tentative Steps Toward Being Pro-Arbitration: A Turkish
Perspective .............................................................................. Yusuf Kumtepe 597
Chapter 107
Making International Arbitration “Pro-Arbitration”: Eliminating
Hindrances and Enhancing Accessibility ........................... Zeina Obeid 603
Columbia Law School International Law Faculty 1980

(top left)
PREFACE
Elora Neto Godry Farias1
Gino Rivas2
Gustavo Favero Vaughn3
Kabir Duggal4
Mateo Verdias5
When one thinks of someone who had more than 10,000 students into the
intricacies of international arbitration, opened the doors of teaching to a great
number of teaching assistants, tailored the minds and installed a spirit of
criticism and curiosity for knowledge to the Columbia Law School (CLS)
international arbitration Alumni for almost five decades, there is only one
name that comes to mind: Professor George Bermann. This merely scratches
the surface of what Professor Bermann has done so far.
Although words cannot describe all his accomplishments and qualities, it is
fair to say, in a nutshell—a word that reminds one of his books, “International
Commercial Arbitration in a Nutshell”—, that Professor Bermann is an
intellectually curious and generous person who explored and unveiled what
became some of the basic pillars of international arbitration law. His course on
“International Arbitration and Private International Law” is living proof of that,
as well as many other books and chapters he wrote on international arbitration.
Alongside the much missed Professor Emmanuel Gaillard, and with the
assistance of Yas Banifatemi, Professor Bermann accepted the challenging
invitation made by UNCITRAL and prepared the Guide on the Convention on the
Recognition and Enforcement of Foreign Arbitral Awards (the 1958 New York
Convention) (Guide), which aims to promote the uniform and effective
interpretation and application of the New York Convention with a view to limit
the risk that State practice might diverge from its spirit. This Guide is one of the
most comprehensive works ever done on the New York Convention.
1 Elora Neto Godry Farias is Columbia Law School LL.M. (‘22) and an International Attorney
at Milbank LLP, in the São Paulo office.

2 Gino Rivas is a Columbia Law School LL.M. (‘22) and Professor at Pontificia Universidad
Católica del Perú, in Lima, Perú.

3 Gustavo Favero Vaughn is a Columbia Law School LL.M. (‘22) and an International Lawyer
at Cleary Gottlieb LLP, in the New York office.

4 Kabir Duggal is a Lecturer-in-Law at Columbia Law School and the Managing Editor of
Columbia’s The American Review of International Arbitration. Professor Bermann introduced

Kabir to arbitration even though he was not his student and Kabir considers Professor Bermann
not just as his mentor but rather as part of his family.
5 Mateo Verdias is a Columbia Law School LL.M. (‘22) and a Visiting Lawyer at the
International Arbitration and Litigation group of Sullivan & Cromwell LLP, in the New York
office.
xv
xvi PREFACE
His influence also reflects the arbitration law in the U.S. Professor Bermann
has been helping to shape arbitration in the U.S., the country where he has been
teaching for decades at Columbia Law School courses mainly on international
commercial arbitration, investment treaty arbitration, and transnational
litigation. In addition to actively participating on the most important and
controversial U.S. courts judgments on arbitration-related matters as amicus
curiae, drafting very clear and thorough briefs fighting the pro-arbitration idea
(e.g., the discussions about the enforceability of arbitration agreements, the
“who decides question,” one of his favorite topics, and about the availability of
U.S.-style discovery in aid of private international arbitration proceedings),
Professor Bermann was the reporter of the famous Restatement of the Law,
The U.S. Law of International Commercial and Investor–State Arbitration, an
initiative led by the American Law Institute. With more than one thousand
pages, the Restatement, in Professor Bermann’s words, “focuses on what
courts are asked to do and, among the things they’re asked to do, what they are
willing to do. Essentially we have three phases in the life cycle of an arbitration
where a court is invited to intervene: launching the arbitration, arbitral
proceedings, and post-award.”
Remarkably, Professor Bermann made it his mission to explore arbitration
not as an isolated area, but rather as a broader phenomenon in interaction with
courts. And this is fundamental to guarantee arbitration’s legitimacy since the
Judiciary usually has the final say over the validity of any arbitration
proceedings. His article entitled “The ‘Gateway’ Problem in International
Commercial Arbitration,” one of Professor Bermann’s masterpieces, is
recommended for reading across arbitration schools around the world.
It is also noteworthy his unprecedented work for the American Review of
International Arbitration (ARIA), Columbia Law School’s quarterly law review
that publishes scholarly articles, commentaries on recent developments, case
notes, and other materials relating to international commercial arbitration. As
ARIA’s Editor-In-Chief for a long time, Professor Bermann has made it the only
publication of its kind in the U.S. and one of the leading publications in the field
internationally. Also at Columbia Law School, Professor Bermann has been
leading the countless efforts of the Columbia International Arbitration
Association, including enthusiastically guiding students to organize the unique
annual Columbia Arbitration Day. His passion also let to the establishment in
2012 the Center for International Commercial and Investment Arbitration at
Columbia Law School, which was founded with the intention to serve as a think
tank for advanced theory and practice, a Center that integrates the law and
practice of international arbitration with related participants and stakeholders
in the field, and much more.
This is not the first tribute Professor Bermann receives. This is not a
surprise. So much contribution to the arbitration academy from a world-
renowned authority on comparative law, EU law, international trade contracts,
WTO dispute resolution, and transnational litigation and arbitration does not
PREFACE xvii
go unnoticed. Indeed, two of his former students who are top-notch arbitration
practitioners, namely Julie Bédard and Patrick Pearsall, just published another
tribute entitled “Reflections on International Arbitration—Essays in Honor of
Professor George Bermann” by Juris Publishing. And yes, this will surely not
be the last honor he receives.
But the new well-deserved tribute to Professor Bermann as we now
present to the arbitration world is special. It is much more than a tribute. This
is the first time that a Columbia Law School professor receives a book in his
honor written in collaboration by such a large group of CLS Alumni from all
over the world and esteemed Columbia University faculty—the book impressively
has more than 100 coauthors! This number reflects, among many things, a very
unique approach that Professor Bermann has towards lawyers, both domestic
and international. As a Columbia Law School LL.M. alumnus himself, Professor
Bermann is constantly pushing CLS faculty and students to interact deeply
irrespective of their program of study, whether a Juris Doctor (J.D.) degree or
a Legis Magister (LL.M.) degree. As anticipated, several of Professor Bermann’s
faculty at Columbia involved in international arbitration have also contributed
to this volume to honor this legend.
We must say that there were much more alumni who were eager to
contribute to this collection of articles. But, as always, conciseness is a must-
achieve feature for lawyers; and so, a concise book was in order. This
notwithstanding, conciseness was not a barrier to get one of the most diverse
body of worldwide contributors that the arbitration community has ever seen.
Although this book contains the views of 105 contributors, it simply represents
the great academic respect and personal esteem that more than 10,000
students Professor Bermann has had over the years feel for him.
We the editors—Kabir Duggal, Elora Neto Godry Farias, Gustavo Favero
Vaughn, Mateo Verdias and Gino Rivas—are overjoyed to help this Columbia
Law School Alumni tribute come to life, in honor of a fantastic person who has
been defined as being himself a “gateway to international arbitration.” At a
personal level, Professor Bermann is like an extended family to each of us and,
for that, we are eternally grateful.
We now invite you all to go through the excellent scholarly contributions
contained in this book, reading between the lines—or sometimes even in the
lines—about the great appreciation and respect that our entire community
feels towards our very own Professor Bermann.
xviii PREFACE
Professor George Bermann and Professor Sandra Bermann, Princeton, New

Jersey on the occasion of their 50th wedding anniversary.
December 2019
FOREWORD
Gillian Lester*
Over his near half-century on the Columbia law faculty, George Bermann
has left an indelible mark on both the school and the profession. He earned an
LL.M. degree at Columbia in 1975—the same year he joined the full-time
faculty—and has spent the past 47 years teaching and mentoring students,
producing scholarship that has helped shape the contours of multiple fields of
law, and mediating some of the most complex multi-national commercial
disputes as a practicing international arbitrator.
George’s contributions have singularly cemented Columbia’s place as a top
institution for the study of international and comparative law, European law,
and international arbitration and dispute resolution. In 1994, he founded the
Columbia Journal of European Law, and just a few years later, in 1998,
established the European Legal Studies Center, for which he continues to serve
as co-director. Year after year, international arbitration scholars and
practitioners from around the world convene at Columbia Law School under
the auspices of the Columbia Center for International Commercial and
Investment Arbitration, which George created and directs. And he also serves
as co-editor-in-chief of the American Review of International Arbitration—the
leading academic journal in the field.
For generations of students, George has been much more than a classroom
teacher. Although his courses are always in high demand, it is his steady
devotion to mentoring and counseling students—particularly international
and LL.M. students—that truly sets him apart. The line of students outside
George’s office frequently extends down the hallway, as he helps demystify the
law while also providing treasured advice about legal careers and practice.
George also advises multiple international moot court teams, including the
prestigious Philip C. Jessup International Law Moot Court Competition.
In fact, one need not look farther than this volume to grasp the significance
of George’s influence and the high esteem in which he is held by our global
community. It is a testament to those enduring connections that four Columbia
LL.M. graduates and a faculty colleague serve as editors, with numerous Law
School alumni contributing as authors.
As much as this project reflects George’s Columbia linkages, it is also itself
a significant contribution to the field of international arbitration. In the pages
that follow, more than 100 articles pay tribute to George and reflect—some
critically—on his ideas and contributions. The result is a rich and thoughtful
* Gillian Lester is Dean and Lucy G. Moses Professor of Law at Columbia Law School.
xix
xx FOREWORD
survey of the major topics in international arbitration; I cannot think of a more

fitting way to pay tribute.
As George nears his 50th year teaching at Columbia Law School, we are—
as we have always been—deeply honored to have him among us. He is a
backbone of our faculty, and with his seemingly inexhaustible energy, an
engine of the Law School’s progress. Let this book be a joyful reminder of
George’s career, and a fitting expression of our admiration and appreciation
for all that he has given to the Columbia Law School and international
arbitration communities.
Professor Bermann's Children (from left to right):

Sloan Bermann, Grant Bermann, Suzanne Bermann.
Princeton, New Jersey 2008
ABOUT GEORGE A. BERMANN
Jean Monnet Professor of European Union Law and
Walter Gellhorn Professor of Law
Director, Center for International Commercial and Investment Arbitration
Columbia University School of Law
Office: Home:
435 West 116th Street (Box A-10) 57 Hemlock Circle
New York, New York 10027 Princeton, New Jersey 08540
Tel.: (212) 854-4258 Tel.: (609) 924-6149
Fax: (212) 854-7946 Fax: (212) 854-7946
email: gbermann@law.columbia.edu email: gbermann@law.columbia.edu
website: https://georgebermann.com
PERSONAL:
Date of birth: December 2, 1945
EMPLOYMENT:
Columbia University School of Law:
Positions:
Walter Gellhorn Professor of Law (2002 to date)
Jean Monnet Professor of European Union Law (2001 to date)
Director, Center for International Commercial and Investment Arbitration
(CICIA) (2012 to date)
Director, European Legal Studies Center (1998–2014)
Courses taught:
Transnational Litigation
Comparative Law
International Commercial Arbitration
WTO Dispute Resolution
Investor-State Law and Arbitration
Contracts
European Union Law
Administrative Law and Government Liability
Professeur affilié, Ecole de droit, Institut des sciences politiques (Sciences

Po) (2012 to date)
xxi
xxii ABOUT GEORGE A. BERMANN
OTHER EMPLOYMENT:
Academic:
Lecturer, MIDS (Masters in International Dispute Settlement) Program,
Geneva (2015 to date)
Lecturer, LLM in Transnational Arbitration and Dispute Settlement,
Institut des sciences politiques (Sciences Po), Paris (2018 to date)
Lecturer, Georgetown Law Center (2014–2017)
Visiting professor, Masters in Arbitration and International Commerce,
Univ. of Versailles - St. Quentin (2011)
Visiting professor, Masters in le droit et la globalisation, Univ. of Paris I
(Pantheon-Sorbonne) (2003–2010)
Visiting professor, LLM, Univ. of Paris II (2000–2010)
Visiting professor, Collège d’Europe, Bruges, Belgium (2003–2014)
Visiting Professor, New York Univ. School of Law, New York (2001)
Fellow, Center for International Studies, Princeton Univ., Princeton, NJ (2000)
Visiting professor, Univ. of St. Gallen, Switzerland (1998)
Visiting Professor, Tulane Law School, New Orleans, La. (1998)
Visiting Professor, Univ. of Fribourg, Switzerland (1997)
Visiting Professor, Univ. of Rouen, France (1981–1982)
Professor, Leyden-Amsterdam-Columbia Summer Program in American
Law, Leyden and Amsterdam (the Netherlands) (1979–1982)
Professional:
International Arbitrator in International Commercial and Investor-State
Disputes (1982 to date)
Expert witness before courts and tribunals on international arbitration,
transnational litigation, European Union law, and the law of France, Germany
and the UK
Associate, Davis Polk & Wardwell, New York, N.Y. (1970–1974)
EDUCATION:
Legal:
J.D. Yale Law School (1971); Editor of the Yale Law Journal
LL.M. Columbia Law School (1975)
Undergraduate:
B.A. Yale College (1967); summa cum laude with exceptional distinction in
political science; University Prize for best senior essay in political science; Phi
Beta Kappa; Senior editor and copy Editor, Yale Daily News; William S. Cowles
Scholarship
ABOUT GEORGE A. BERMANN xxiii
Other:
Tocqueville-Fulbright Scholar, Univ. of Paris I (Pantheon-Sorbonne), Paris,
France (2006–2007)
Visiting Scholar, Max Planck Institut für ausländishes öffentliches Recht
und Völkerrecht, Heidelberg, Germany (1976)
Non-degree legal studies, Univ. of Paris II (1974–1975); Univ. of Munich
(1975); Univ. of Heidelberg (1976)
Visiting Scholar, Conseil d’Etat, Paris, France (1974–1975)
Marshall Scholar, Univ. of Sussex, Falmer, Brighton, England (1967–1968)
PROFESSIONAL MEMBERSHIPS AND ACTIVITIES:
Chief Reporter, ALI Restatement of the US Law of International

Commercial and Investor-State Arbitration (2008–2020)
Founding Member, Governing Board, International Chamber of Commerce
(ICC) International Court of Arbitration (2012–2016)
Member, Standing Committee of the International Court of Arbitration
(2015-2020)
Member, ICC Commission on Arbitration (2011 to date)
Chair, Global Board of Advisers, New York International Arbitration Center
(NYIAC) (2013 to date)
Council member, American Arbitration Association (AAA) (2008–2020)
Board of Advisers, Center for Conflict Prevention and Resolution (CPR)
(2014 to date)
Chair, Board of Advisors, Thai Arbitration Center, Bangkok, Thailand (2018
to date)
Chair, Board of Advisors, Center for International Investment and
Commercial Arbitration (ICIICA), Lahore, Pakistan (2015 to date)
Member, Institut de droit international (IDI) (2019 to date)
Observer, Working Group III of United Nations Commission on
International Trade Law on Reform of the Investor-State System (2018 to
date)
Member, Academic Forum, in connection with UNCITRAL Working Group
III (2017 to date)
Advisory Committee on Private International Law, US State Department,
(2018 to date)
President, International Academy of Comparative Law (Académie
internationale de droit comparé) (2006–2014)
President, American Society of Comparative Law (ASCL) (1998 to 2002)
Member, Advisory Committee, ALI Restatement (Fourth) of Foreign
Relations Law of the United States (2016–2019)
Member, Advisory Committee, ALI Restatement (Third) of Conflict of Laws
(2014 to date)
xxiv ABOUT GEORGE A. BERMANN
Member of Board of Advisors, Koç Univ. Law School, Istanbul, Turkey

(2005 to date)
Visiting Fellow, Center for International Studies, Princeton Univ.,
Princeton, NJ (2000)
Adviser to the Legal Service of the Commission of the European Union
(1994–1995)
Editorial Positions
Co-Editor in Chief, American Review of International Arbitration (2011 to
date)
Member, Comité scientifique, Revue de l’Arbitrage (Paris) (2011 to date)
Co-Editor in Chief, American Journal of Comparative Law (2004–2008)
Founder, Editor-in-Chief & Chair of the Executive Editorial Board,
Columbia Journal of European Law (1994 to date)
Board of Directors, Columbia Journal of Transnational Law (1989–2010)
Amicus Briefs
Servotronics, Inc. v. Rolls-Royce PLC, et al. (brief in support of petitioner, 2021)
Archer & White Sales, Inc. v. Henry Schein, Inc. (brief in support of cross-
petitioner, 2020)
Henry Schein, Inc. v. Archer & White Sales, Inc. (brief in support of petitioner,
2020)
Piersing v. Domino’s Pizza Franchising, LLC. (petition for certiorari, 2020)
GE Energy Power Conversion France SAS, Corp. v. Outokumpu Stainless USA,
LLC (brief in support of petitioner) (2019)
New Mighty U.S. Trust v. Shi (petition for writ of certiorari, 2019)
Republic of Sudan v. Harrison (brief in support of petitioner, 2018)
Animal Science Prods, Inc. v. Hebei Welcome Pharmaceutical Co., Ltd.
(petition for writ of certiorari, 2018)
Henry Schein, Inc. v. Archer & White Sales, Inc. (brief in support of respondent,
2018)
Republic of Sudan v. Harrison (petition for writ of certiorari, 2017)
AMCI Holdings, Inc. v. CBF Industria de Gusa S.A. (petition for certiorari, 2017)
Orange SA v. Telesocial, Inc. (brief in support of petitioners, 2016)
Walia v. Dewan (petition for certiorari, 2014)
Government of the Lao People’s Democratic Republic v. Thai-Lao Lignite
(Thailand) Co., Ltd. (petition for certiorari, 2013)
BG Group PLC v. Republic of Argentina (brief in support of petitioner, 2013)
Titan Maritime, LLC v. Cape Flattery Limited (petition for writ of certiorari,
2013)
BG Group PLC v. Republic of Argentina (petition for writ of certiorari, 2012)
Kiobel v. Royal Dutch Petroleum Co. (brief in support of petitioners, 2012)
Morrison v. National Australia Bank, Ltd. (brief in support of respondents,
2010)
ABOUT GEORGE A. BERMANN xxv
Honorary Degrees and Awards

Doctorate honoris causa, Univ. of Fribourg, Switzerland (2004)
Doctorate honoris causa, Univ. of Versailles-St. Quentin, France (2011)
Doctorate honoris causa, Universidad Cesar Vallejo, Lima, Peru (2017)
Doctorate honoris causa Universidade Nova de Lisboa, Portugal (2018)
Lifetime Achievement Award, American Society of Comparative Law (2016)
Patron, Chartered Institute of Arbitrators, New York Branch (2018)
Honorary Member, American Association of Private International Law
(ASEDIP) (2009)
Honorary Member, Group of the 100 of the Center of Legal Innovation,
Development and Research for Latin America (2011)
C.V. Starr Award, New York Law School, New York, NY (2009)
Honorary Member, American Bar Association, Section of Administrative
Law and Regulatory Practice (2008)
Tocqueville-Fulbright Distinguished Professorship (Univ. of Paris) (June-
Dec. 2006)
Distinguished Service Award, American Foreign Law Association (June 2005)
Jean Monnet Chair of European Law (conferred July 2001)
Bar Admissions
Supreme Court of the United States (1992)
Southern District of New York (Federal) (1980)
Eastern District of New York (Federal) (1980)
New York State (1972)
Legislative Testimony
UK Select Committee of House of Lords: UK Ratification of the Draft
European Constitution (2005)
Senate Judiciary Committee: The OPEC countries, sovereign immunity and
act of state (2004)
House Committee on Foreign Affairs: Colombian practice in international
arbitration and Andean legislation benefits (2002)
House Committee on Government Operations: Tort liability of Federal
public officials (1983)
Foreign Languages
French (fluent)
German (reading knowledge)
Spanish (reading knowledge)
xxvi ABOUT GEORGE A. BERMANN
FIELDS OF RESEARCH, WRITING AND PUBLIC SPEAKING
A. International Arbitration
B. Administrative Law
C. European Union Law
D. Comparative Law
E. International Law & International Trade
F. Administrative Law
A. INTERNATIONAL ARBITRATION
Books
Twilight Issues in International Arbitration (Kluwer Pub. forthcoming 2022)
Autonomy in the International Arbitration Legal Order (Cambridge Univ.
Press forthcoming 2022)
International Commercial Arbitration (West. Pub. 2020)
ALI, Restatement of the US Law of International Commercial and Investor-
State Arbitration (2020)
Mandatory Rules of Law in International Arbitration (with L. Mistelis) (2d
ed. Juris. Pub. 2019)
International Commercial Arbitration and Private International Law (Hague
Academy of Private International law, General Course) (Brill Pub. 2017)
The Interpretation and Application of the New York Convention in National
Courts (Springer Pub. 2017)
UNCITRAL Guide to the New York Convention (with E. Gaillard) (United
Nations Pub. 2017)
Articles and Book Chapters

After First Options: Delegation Run Amok, 32 Am Rev. Int’l Arb. 15 (2021)
Intersections between International Investment Arbitration and EU Law,
in EU Investment Law and
Arbitration, in International Arbitration & EU Law (N. Lavranos & J-RMata
Dona, eds., Edward Elgar Pub. 2021)
The Future of International Commercial Arbitration, in Cambridge Companion
to International Arbitration
(Chin Leng Lim, ed., forthcoming 2021)
Procedures for Enforcement of New York Convention Awards, in Autonomous
versus Domestic Standards under the New York Convention 55 (Franco Ferrari
& Friedrich Rosenfeld, eds., Wolters Kluwer 2021)
Res Judicata in International Arbitration, in Cambridge Compendium of
International Commercial and Investment Arbitration (A. Bjorklund et al., eds.,
Cambridge U. Press. forthcoming 2021)
ABOUT GEORGE A. BERMANN xxvii
The Contribution of International Commercial to International Investment

Arbitration, in International Investment Law: An Analysis of the Major Decisions
(H. Ruiz-Fabri & E. Stoppioni, eds., Hart Pub. 2020)
Understanding ICSID Article 54, 35 ICSID Rev. 311 (2020)
The Self-Styled “Autonomy” of International Arbitration, 36 Arb. Int’l 221
(2020)
Rescuing the Federal Arbitration Act, 20 Ybk Priv. Int’l L. 15 (Otto Schmidt
Pub., Swiss Institute of Comparative Law 2020)
Private International Law in International Arbitration, in Private International
Law: Contemporary Challenges and Continuing Relevance (F. Ferrari &
D. Fernandez-Arroyo, eds., Edward Elgar Pub. 2020)
Costs Allocation in International Arbitration: What Normative Source If
Any?, in Finances in International Arbitration (S. Tung et al., eds., Wolters
Kluwer Pub. 2020)
The Mitsubishi case, in The Building of an Arbitration-Friendly Jurisdiction
in Global Private International Law (H. Muir-Watt et al., eds., Edward Elgar
Pub. 2019) (published in French as L’émergence de la faveur judiciaire à
l’arbitrage, in Le tournant global en droit international privé) (H. Muir-Watt et
al, eds. 2020)
European Union Law and International Arbitration at a Crossroad, 42
Fordham Int’l L. J. 967 (2019)
Honoring the Parties’ Intent, 2019 International Chamber of Commerce
Bulletin 1 (2019)
What Does it Mean to be Pro-Arbitration?, 34 Arb. Int’l 341 (2018)
The Role of National Courts at the Threshold of Arbitration, 28 Am. Rev.
Int’l Arb. 291 (2018)
The Energy Charter Treaty and European Union Law, in International
Arbitration in the Energy Sector (M. Scherer, ed., Oxford U. Press 2018)
European Union Law as a Jurisdictional and Substantive Defense in
Investor-State Arbitration, in The Impact of EU Law on International Commercial
Arbitration (F. Ferrari, ed., Juris Pub. 2017)
International Standards as a Choice of Law Option in International
Arbitration, 27 Am. Rev. Int’l Arb. 423 (2017)
The Yukos Annulment: Answered and Unanswered Questions, 27 Am. Rev.
Int’l Arb. 1 (2016)
Limits to Party Autonomy in Composition of the Arbitral Panel, in Limits to
Party Autonomy in International Commercial Arbitration 83 (F. Ferrari, ed.,
Juris Pub. 2016)
Jurisdiction in International Arbitration: Courts v. Arbitrators, in International
Commercial Arbitration in New York (J. Carter & D. Lindsey, eds., Oxford Univ.
Press 2d ed. 2016)
Gateway-Schmateway: An Exchange between George Bermann and Alan
Rau, 43 Pepperdine L. Rev. 469 (2016)
xxviii ABOUT GEORGE A. BERMANN
International Commercial Arbitration: Present Challenges and Future

Prospects in International Arbitration (festschrift for John Beechey) (A.
Carlevari et al., eds., ICC Pub. 2016)
Sounds and Silences: Case note on the Gazprom Judgment of the European
Court of Justice, 22 Maastricht J. Eur. & Comp. L. 888 (2015)
International Commercial Arbitration: Past Present & Future (Center for
Conflict Prevention and Resolution (CPR)) (2015)
Navigating EU Law and the Law of International Arbitration, 28 Arb. Int’l 397
(2012)
Arbitrability Trouble, 23 Am. Rev. Int’l Arb. 367 (2012)
American Exceptionalism in International Arbitration, in Contemporary
Issues in International Arbitration and Mediation: The Fordham Papers 2011
(Arthur Rovine, ed., Martinus Nijhoff 2012)
The “Gateway” Problem in International Commercial Arbitration, 37 Yale
J. Int’l L. 1 (2012)
The Prospects of Eco Swiss v. Benetton for International Commercial
Arbitration, in The Practice of Arbitration (festschrift for van Houtte) (P.
Wautelet et al., eds., Hart Pub. 2012)
Domesticating the New York Convention: The Impact of the Federal
Arbitration Act, Comparative Perspectives on International Arbitration (Giuditta
Cordero Moss, ed., Cambridge Univ. Press 2012); also in 2011 Jnt’l Disp. Settle’t
317 (2011)
Reconciling European Union Law Demands with the Demands of
International Arbitration, in A Man for All Treaties (festschrift for J.C. Piris)
(Jean Paul Jacqué et al., eds., Bruylant 2011); also in 34 Fordham Int’l L. J. 1193
(2011)
The Supreme Court Trilogy and its Impact on US Arbitration Law, 22 Am.
Rev. Int’l Arb. 551 (2011)
The UK Supreme Court Speaks to International Arbitration: Learning from
the Dallah Case, 22 Am. Rev. Int’l Arb. 1 (2011)
Mandatory Rules in International Commercial Arbitration, in Conflict of Laws
in International Arbitration 325 (F. Ferrari & S. Kroll eds., Sellier Pub. 2010)
Jurisdiction: Courts vs. Arbitrators, in International Commercial Arbitration
in New York, (J. Carter & J. Fellas, eds. Oxford Univ. Press 2010)
Restating the Law of International Commercial Arbitration, 42 N.Y.U. J. L.
& Pol. 175 (2009)
Ascertaining the Parties’ Intentions in Arbitral Design, 113 Penn St. L. Rev. 993
(2009)
The Role of Courts and Arbitrators in Determining Arbitral Jurisdiction in
US Law (festrschrift for Pierre Tercier) 727 (Montcretien 2008)
Mandatory Rules of Law in International Arbitration, 18 Am. Rev. Int’l Arb.
1 (2007)
Competence to Set Aside an Award and Procedural Grounds for Refusing
Enforcement: The Viewpoint and Role of the Arbitration Law Expert, in Ius
ABOUT GEORGE A. BERMANN xxix
Arbitrale Internationale (festschrift for Hans Smit) (T. Carbonneau & V.

Pechota, eds.), 3 Am. Rev. Int’l Arb. 93 (1992)
Conference and Workshop Papers

Kazakhstan, Investment Arbitration and the Rule of Law (World Bank,
Washington DC, 2021)
Arbitrating Arbitrability (Georgetown Law Center, 2021)
Choice of Seat in International Arbitration (Center for International Legal
Affairs of the Presidency, Tehran, Iran, 2021)
Emergency Arbitrators and National Courts (Columbia International
Arbitration Association, 2021)
Applying International and Foreign Law in International Arbitration
(6 Qianhai Legal Intelligence Forum, Shenzhen, China)
th
Is there a Right to an In-Person Hearing? (Columbia Arbitration Day,

Columbia Law School, New York, NY, 2021)
Arbitrator Ethics, Conflicts and Disclosure (Chartered Institute of Arbitrators,
Brazil Branch, 2021)
In Conversation with Neil Kaplan (Delos, 2021)
Twilight Issues in International Arbitration (Venezuelan Chamber of
Commerce Arbitration Commission, 2021)
When is Consent “Clear and Unmistakable”? (2d annual meeting, Chinese
International Commercial Expert Committee, 2020)
Interim Measures in International Arbitration (Vth Oxford Arbitration Day,
2020)
International Arbitration in Europe under Covid-19 (ABA International
Law Section conference on Regional Perspectives on Investor-State Claims in
Light of COVID-19, 2020)
US Discovery for International Arbitration (conference of Davis Polk &
Wardwell, LLP, New York, NY, Paris Arbitration Week, 2020)
International Arbitration as an Autonomous Legal Regime (conference of
Herbert Smith LLP, Paris Arbitration Week, 2020)
Stories from the Hearing Room (annual meeting, Institute for Transnational
Arbitration (ITA), 2020)
Dispute Resolution in Pandemic Times (Italian Forum on International
Arbitration, 2020)
Developments in Class Arbitration (annual meeting, ABA International
Law Section, 2020)
Where Does Responsibility for Policing Counsel Conduct in International
Arbitration Lie? (Columbia Arbitration Day, Columbia Law School, New York,
NY, 2020)
Quelle concurrence des juridictions privies: l’emergence de la faveur judiciaire à
l’arbitrage, in Le Tournant Global en Droit International Privé (H. Muir-Watt
et al., eds.) (2020)
xxx ABOUT GEORGE A. BERMANN
Reflections on the Restatement (conference at Pepperdine Univ. School of

Law, 2020)
Reform of the Investor-State System (meeting of Academic Forum connected
to UNCITRAL Working Group III, New York International Arbitration Center,
New York, NY, 2020)
The New International Arbitration Restatement (1st annual New York
Arbitration Week, Nov. 20, 2019)
The Self-Styled Autonomy of International Arbitration (Global Arbitration
Review conference, Atlanta, Ga., 2019)
Interim Measures in International Commercial Arbitration (conference at
Univ. of Lausanne, Lausanne, Switzerland, 2019)
Fallout from the Achmea Judgment (annual meeting, American Society of
International Law, Washington DC, 2019)
Mandatory Law in International Arbitration (annual meeting, International
Bar Association, Montreal, Canada, 2019)
The EU Challenge to Investor-State Arbitration (Columbia Arbitration Day,
Revisiting International Arbitral Awards (International Chamber of
Commerce, Paris, France, 2019)
The Future of Investment Treaty Arbitration (Centre for Advanced Research
in Dispute Settlement (CARDS), Paris, France, 2019)
An Uptick in Arbitration Cases before the US Supreme Court (annual
meeting, International Bar Association, New York, NY, 2019)
Reform of the Investor State Dispute Settlement (Univ. of Oslo, Norway, 2019)
The Fragmentation of international Law: Resolving the Conflict between
EU Law and International Investment Law (International Law Association,
International Law Weekend, Fordham Univ. School of Law, New York, NY, 2019)
Gateway Issues in International Arbitration (conference at Casablanca
International Mediation and Arbitration Center, Casablanca, Morocco, 2018)
Private International Law and International Arbitration (conference on
continuing relevance of private international law, N.Y.U. Law School, New
York, NY, 2018)
International Arbitration and European Union Law (conference on the Future
of International Arbitration, Stockholm Centre for Commercial Law & Oxford
Institute of European and Comparative Law, Stockholm, Sweden, 2018)
Twilight Issues in International Arbitration (project conference at FGV
Direito SP Univ., São Paulo, Brazil, 2018)
Procedural Due Process Paranoia (book launch for Luke Sobota’s “General
Principles of Law and International Due Process,” New York International
Arbitration Center, New York, NY, 2018)
Casting Light on Twilight Issues in International Arbitration (conference in
honor of Gabrielle Kaufmann-Kohler, Univ. of Geneva, 2018),
International Arbitration and its Current Challenges (Kyoto Univ., Kyoto,
Japan, 2018)
ABOUT GEORGE A. BERMANN xxxi
The Achmea Decision and the ECJ’s Challenge to International Investment

Arbitration (Univ. of Amsterdam, the Netherlands, June 26, 2018)
Sources of Law for Twilight Issues in International Arbitration (project
conference at Singapore International Arbitration Center, Singapore, 2018)
The Role of US Courts in the Enforcement of Arbitral Awards (Univ. of
Milan, Milan, Italy, 2018)
Normative Sources for Twilight Issues in International Arbitration (project
conference at Queen Mary College, Univ. of London, UK, 2018)
Challenges in the Restatement of the US Law of International Commercial and
Investment Arbitration (presentation to the bench and bar of the federal district
court for the southern district of Texas (Houston, Tex., 2018)
The New York Convention and European Union Law (Corpus Christi
College, Univ. of Oxford, UK, Institute of European and Comparative Law, 2018)
International Arbitration and the Law of the Second Circuit (conference at
Sidley Austin, New York, NY, 2018)
The New York Convention: Unresolved Issues 60 Years On (Columbia
Arbitration Day, Columbia Law School, New York, NY, 2018)
Is the Multilateral Investment Court the Way Forward? (Univ. of Paris I
(Sorbonne), Paris, France, 2018)
European Union Law and International Arbitration: A Collision Course
(Georgetown Univ. Law Center, 2018)
Arbitration is Dead. Long Live Arbitration (Institute des Sciences Politiques
(Sciences Po) & Queen Mary College, Univ. of London, Paris, France, 2018)
Moderator, Getting the Facts Straight: Empirical Data on International
Arbitration (annual meeting, American Arbitration Association, International
Center for Dispute Resolution, Columbia Law School, 2017)
Moderator, Conflicting Supranational Obligations: The Complex Web of
State Liability (Columbia Arbitration Day, Columbia Law School, New York, NY,
2017)
The Singularity of Investor-State Arbitration (Chinese International
Economic and Trade Arbitration Commission (CIETAC)), Beijing, China, 2017)
The Enforceability of Annulled Awards (GAR Live Paris, France, 2017)
Privilege and International Arbitration: Cross-Border Clarity or Confusion
in Law and Practice? (17th annual meeting, College of Commercial Arbitrators,
Minneapolis, Minn., 2017)
Capacity-Building in Investor-State Arbitration (World Bank conference
on Asia-Pacific Economic Cooperation (APEC), Washington DC, 2017)
Enforcement of Arbitral Awards: The Challenges for Award Creditors
(Hogan Lovells, LLP, New York, NY, 2017)
Twilight Issues in International Arbitration (Rio de Janeiro Bar Association,
Rio de Janeiro, Brazil, 2017)
The Opportunity to Present One’s Case: Equality of Arms (16th International
Arbitration Congress of the Comité Brasileiro de Arbitragem, Gramado, Brazil,
2017)
xxxii ABOUT GEORGE A. BERMANN
Is Arbitration Insufficiently Predictable? (6th annual GAR Live New York,

2017)
International Framework of Arbitration: Where are the Needs? (Congress
of United Nations Commission on International Trade Law (UNCITRAL),
Vienna, Austria, 2017)
Sanctioning Corruption in International Arbitration (seminar at Cleary
Gottlieb LLP, New York, NY, 2017)
The Future of International Arbitration in a Trump and Brexit Era (Univ. of
Pennsylvania International Arbitration Day, 2017)
Reshaping International Investment Law and the Investor-State Dispute
Settlement System, Univ. of Paris I (Sorbonne), Paris, France, 2017)
The EU Law Challenge to International Arbitration (Univ. of Stockholm,
2017)
International Arbitration: The European Union Law Challenge (address to
American Foreign Law Association, New York, NY, 2017)
The Interpretation and Application of the New York Convention: Taking
Stock of the Practice (New York International Arbitration Center, New York, NY,
2016)
Challenges in the Enforcement and Execution of ICSID Awards (conference
at Freshfields LLP, New York, NY, 2016)
The European Union’s Jurisdictional and Substantive Challenges to
International Investment Arbitration (New York Univ. School of Law, New
York, NY, 2016)
Enforceability of Annulled Awards (conference at Fordham Law School,
New York, NY, 2016)
European Union and its Conflicts with International Arbitration (Vilnius
Bar Association, Vilnius, Lithuania, 2016)
The Role of International Standards as Legal Norms (International Bar
Association, Washington DC, 2016)
ICC Institutional Reform: Too Far or not Far Enough? (International
Chamber of Commerce conference, New York, NY, 2016)
The Enforceability of Arbitration Agreements (biennial meeting of the
International Congress of Commercial Arbitration, Mauritius, 2016)
International Standards in Interpretation of the New York Convention
(New York Univ. School of Law, New York, NY, 2016)
The Fate of Arbitration Agreements in National Courts (Queen Mary
College, Univ. of London, LLM Program, Paris, France, 2016)
Revisiting Chromalloy: Enforcing Vacated Awards under the New York
Convention (presentation at Sidley & Austin, LLP, New York, NY, 2016)
Restatement Challenges (State Bar of Georgia, Atlanta International
Arbitration Society, and Atlanta Center for international Arbitration & Mediation,
Atlanta, Ga., 2016)
The Emergency Arbitrator (ICC Institute Master Class for Arbitrators, New
York, NY, 2016)
ABOUT GEORGE A. BERMANN xxxiii
The European Union and ICSID Arbitration (Society of International Law,

Yale Law School, New Haven, Conn., 2016)
The Problematic EU-Arbitration Interface: Challenges and Prospects
(Lewis & Clark Law School, Portland, Ore., 2016)
Reflections on Third-Party Funding in Arbitration (New York International
The Problematic EU-Arbitration Interface: Challenges and Prospects
(American Univ. School of Law, Washington DC, 2015)
The New York Convention: Back to the Future (Chartered Institute of
Arbitrators, NYC Bar Association, New York, NY, 2015)
Seminar for Judges of the State and Federal Courts in New York on Salient
Features of the Restatement (US Courthouse, New York, sponsored by the
Chief Judge of the federal district court for the southern district of New York
and the New York International Arbitration Center, 2015)
Emerging International Standards in International Arbitration (Columbia
Law School faculty workshop, New York, NY, 2015)
Transparency: Incumbent on Institutions as Well (conference of ICC
International Court of Arbitration, New York, NY, 2015)
The UNCITRAL Model Law: To Model or Not (centenary of Chartered
Institute of Arbitrators, London, UK, 2015)
The European Union and International Arbitration: A Study in Tensions
between International Legal Regimes (Univ. of Geneva, 2015)
The Growing Incidence of Parallel Arbitration and its Res Judicata Effects
(Penn State International Arbitration Day, 2015)
International Arbitration and the Courts (Pepperdine Law Review Conference,
Malibu, CA, Apr. 2015)
Enforcement of Awards: Have Contracting States been True to the Letter
and Spirit of Article V? (Conference on The New York Convention: Back for the
Future, NYC Bar Association. New York, NY, 2015)
Enforcing the Micula Award in the United States in light of the European
Commission’s Intervention (presentation at Freshfields, LLP, New York, NY,
2015)
The US Restatement through the Prism of French Arbitration Law (Paris
Bar Association, Paris, France, 2015)
The Preclusive Effect of Arbitral Awards in Subsequent Court Proceedings
(Columbia Arbitration Day, Columbia Law School, New York, NY, 2015)
Courts and Tribunals; An Evolving Relationship (New York International
Complex Issues in International Arbitration (conference at NYC Bar
Association, New York, NY, 2014)
An Introduction to International Arbitration in the US (Federal Judicial
Center, Washington DC, 2014)
xxxiv ABOUT GEORGE A. BERMANN
International Commercial Arbitration and its Relationship to Third-Party

Funding (Center for International Commercial and Investment Arbitration
(CICIA), Columbia Club, New York, NY, 2014)
The BG Group Case in the US Supreme Court, Houston International
Arbitration Center, Houston, Tex., 2014)
Exceptionalism in US Arbitration Law, Univ. of Texas School of Law, Austin,
Tex., 2014)
Judge, “This House Believes Witness Examination is Useless and Should be
Abandoned,” Global Arbitration Review Live New York, 2014)
Dealing with the Incomplete Award (Leading Arbitrators’ Symposium on
the Conduct of International Arbitration, Vienna, Austria, 2013),
The Need for an International Investment Consensus-building Process
(Ministry of Foreign Affairs of Finland, Helsinki, Finland, 2013)
Applicable Law in International Commercial Arbitration (ASA/DIS Arbitration
Practice Seminar, Badenweiler, Germany, 2013)
Collision Course: Arbitration and EU law (Program in Law and Public
Affairs, Princeton Univ., Princeton, NJ, 2013)
The State of the Restatement (Yale Law School, New Haven, Conn., 2013)
Forum Shopping at the Gateway to Arbitration (conference at New York
Univ. School of Law, New York, NY, 2013)
Commentator, Tensions between Arbitral Tribunals and Sovereign Courts
(conference at New York Univ. School of Law, 2013)
Lessons from the Restatement (American Foreign Law Association, New
York, NY, 2013)
Exceptionalism and Normalcy in Arbitration Law (commentator at
conference at New York Univ. School of Law, New York, NY, 2012)
The Interplay of Mandatory Provisions of Law: The Law of the Contract,
the Law of the Seat and the Law of the Place of Enforcement? (ICC Conference
on International Arbitration in Latin America, Miami, Fla., 2012)
Injunctions and International Arbitration Proceedings: Academic Perspectives
(conference at NYC Bar Association, New York, NY, 2012)
Collective Action in International Arbitration: Problems and Prospects
(Deutsche-Amerikanische Juristen-Vereingung at Columbia Law School, 2012)
Arbitrability Trouble (NYC Bar Association, New York, NY, 2012)
The Fundamental Differences between Treaty Rights and Contract Rights
(ICC conference on Arbitration with States and State Entities, New York, N.Y.,
2012)
International Arbitration: How it Differs from Domestic Arbitration (New
York State Bar Association, Dispute Resolution Section, and Benjamin N. Cardozo
School of Law, New York. N.Y., 2012)
Restating the Law of International Commercial Arbitration in the United
States: Views from Within and Without (inaugural conference of Atlanta
International Arbitration Authority (ATLAS) on The United States and its Place
ABOUT GEORGE A. BERMANN xxxv
in the International Arbitration System of the 21st Century: Trendsetter,

Outlier or One in a Crowd? Atlanta, Ga., 2012)
Threshold Issues in International Arbitration (International Law Colloquium,
Univ. of Georgia School of Law, Athens, Georgia, 2012)
Competence-Competence in Arbitration Law in Comparative Perspective
(Paris, Place de l’Arbitrage, La Compétence-Compétence à la française: Faut-il
toujours donner la priorité à l’arbitre?, Hotel de Ville, Paris, France, 2012)
Dealing with the Incomplete Award (Leading Arbitrators’ Symposium on
the Conduct of International Arbitration, Vienna, Austria, 2012)
Navigating EU Law and International Arbitration Law (Yale Law School,
New Haven, Conn., (2012)
The Gateway Problem in International Arbitration (Yale Law School, New
Haven, Conn., 2012)
Multi-party arbitration: from Paris to NY (New York Univ. School of Law,
New York, NY, 2012)
Exceptionalism in the US Law of international Arbitration (Washington &
Lee Univ. School of Law, Lexington, Va., 2012)
Moderator, Enforcement of Arbitral Awards against Foreign Sovereigns
The Influence of the UNCITRAL Model Law in non-Model Law Countries
(McGill Univ. School of Law, Montreal, Canada, 2011)
Salient Issues in Contemporary International Arbitration (Washington
College of Law, American Univ., Washington, DC, 2011)
Arbitration Academy course on Gateway issues in international arbitration
in the United States (Paris Arbitration Academy, Paris, France, 2011)
Third Party Funding of International Arbitration Claims: The Newest “New
New Thing,”? (Fordham Law School, New York, NY, 2011)
Cross-Examining the Expert Witness in Arbitration (Harvard Club, New
York, NY, 2011)
Autour de l’ordre juridique arbitral (Ecole de Droit, Institut des Sciences
Politiques, Paris, France, 2011)
The Gateway Problem in International Commercial Arbitration (Max
Planck Institute Institut fŭr Privatrecht und Internationales Privatrecht,
Hamburg, Germany, and Univ. of Münster, Münster, Germany, 2011)
Adapting the Federal Arbitration Act to the New York Convention
(Deutsche-Amerikanische Juristen-Vereinigung, Stuttgart, Germany, 2011)
Preliminary Jurisdictional Issues in International Arbitration (conference
of Leading Arbitrators of the World, Vienna, Austria, 2011)
Les Questions Liminaires en Arbitrage International Commercial (Cour de
Cassation, Paris, France, 2011)
The Complexity of Annulment, Recognition and Enforcement of Arbitral
Awards (Columbia Arbitration Day, Columbia Law School, New York, NY, 2011)
xxxvi ABOUT GEORGE A. BERMANN
Jurisdictional and Admissibility Issues in International Arbitration (Max-

Planck Institut fŭr Privatrecht und Internationales Privatrecht, Hamburg,
Germany, 2011)
The Role of Courts in Supervising Arbitration (George Washington Univ.
School of Law, Washington DC, 2011)
Master Class on Gateway Issues in Arbitration (3rd annual ICC YAF Global
Conference, Paris, France, 2011)
A Status Report on the American Law Institute Restatement of International
Commercial Arbitration, Univ. of Vienna, Vienna, Austria, 2011)
The Immunity of International Arbitrators (master class of International
Chamber of Commerce, Paris, France, 2011)
Privilege in International commercial Arbitration (27th AAA/ICC/ICSID
Joint Colloquium on International Arbitration, Paris, France, 2010)
The Federalism Dimension of International Commercial Arbitration (annual
conference of the American Trial Lawyers Association, Washington DC, 2010)
Commentator, Emmanuel Gaillard on The Representations of International
Arbitration (conference at New York Univ. School of Law, New York, NY, 2010)
Enforceability of the Arbitration Agreement: Who Decides and under
Whose Law? (Annual Fordham Conference on International Arbitration, New
York, NY, 2010)
The Restatement of International Commercial Arbitration (Conferencia
Latinoamericana de Arbitraje, Asuncion, Paraguay, 2010)
Domesticating the New York Convention: The Impact of the US Federal
Arbitration Act (Univ. of Oslo, Norway, 2010)
The Role of the Judiciary in Class Arbitration (Columbia Arbitration Day,
Electronic Discovery in International Arbitration: Boon or Bane? (conference
of the Leading Arbitrators of the World, Vienna, Austria, 2010)
International Arbitration in Iraq’s New Oil Concession Agreements of Iraq
(program for lawyers and Engineers, Iraqi Ministry of Oil, Columbia Law School,
New York, NY, 2010)
Domesticating the New York Convention in American Law (Univ. of
Geneva, Institut des Hautes Etudes, Geneva, Switzerland, 2010)
Bankruptcy and Arbitration on a Collision Course (annual meeting, Center
for Conflict Prevention and Resolution (CPR), New York, NY, 2010)
Enforcement and Execution of Foreign Arbitral Awards: Two Different
Things (Bolivian-American Chamber of Commerce, New York, NY, 2009)
International Arbitration in Periods of Economic Downturn (ICC conference on
Arbitration in Latin Miami, Fla., 2009)
Transparency in International Commercial Arbitration: An Arbitrator’s
View (International Law Weekend, New York, NY, 2009)
Mediation and Arbitration (Global Justice Forum on Global Litigation in a
Post-Economic Crisis World, Columbia Law School, New York, NY, 2009)
ABOUT GEORGE A. BERMANN xxxvii
Effective International Arbitration: A Transatlantic View (ICC UK Annual

Arbitration Practitioners Symposium, London, UK, 2009)
The Restatement of International Commercial Arbitration Meets the Federal
Arbitration Act (Univ. of Georgia, Athens, Georgia, 2009)
Restating International Arbitration (American Society of International
Law, Washington DC, 2008)
Soft Law in International Commercial Law (Queen Mary College, Univ. of
London, London, UK, 2008)
Mandatory Rules of Law in International Arbitration (Columbia Law School,
New York, NY, 2007)
Ethical Considerations in International Arbitration (Harvard Club, New York,
NY, 2007)
Take the Witness Stand: The Art of Cross-Examination in Arbitration
(Paris, France, 2007)
Promoting Transparency and Consistency in International Investment
Arbitration (Center for Global Legal Problems, Columbia Univ., New York, NY,
2006)
International Commercial Arbitration in the Contemporary World (Young
Arbitrators Forum of United States Council for International Business (USCIB),
New York, NY, 2005)
The Autonomy of the International Arbitral Process (Third Journées
Juridiques Franco-Américaines, New Orleans, La., 1988)
Keynote Addresses and Endowed Lectures

Emmanuel Gaillard and his Influence on International Arbitration in the
U.S. (keynote address, GAR Live New York, 2021)
Considerations in Choice of Seat in International Arbitration (keynote
address, conference on choice of arbitral seat, Allameh Tabatabai University,
Teheran, Iran, 2021)
Arbitration and EU Law: What Next? (keynote address, annual Fordham
Conference, New York Arbitration Week, 2020)
International Investment Law and EU Law (keynote address, conference
on Global Trends in Arbitration, Stockholm Centre for Commercial Law &
Oxford Univ., 2020)
International Arbitration at a Crossroads (honorary degree speech, Nova
Universidade de Lisboa, Lisbon, Portugal, 2019)
Defenses to the Enforcement of Awards under ICSID Article 54 (keynote
address, 13th annual Investment Treaty Arbitration Conference, Washington
DC, 2019)
The “Autonomy” of International Arbitration (keynote address, Center for
Conflict Prevention and Resolution, 2019)
International Arbitration: What Does the Future Hold ? (keynote address,
Hong Kong International Arbitration Week, Hong Kong., 2018)
xxxviii ABOUT GEORGE A. BERMANN
Recalibrating the EU-International Arbitration Interface (annual EFILA

address at European Forum on International Law and Arbitration (EFILA),
Brussels, Belgium, 2018)
International Arbitration: Present Problems and Future Prospects (keynote
address. CAM-CCBC Pan American Arbitration Conference, São Paulo, Brazil,
2018)
Recognition and Enforcement of Investor-State Awards (keynote address,
British Institute of Comparative Law, London, UK, (2018)
What Does it mean to be Pro-Arbitration? (keynote address, International
Arbitration Summit Cravath, Swain & Moore LLP, New York, NY, 2018)
A User’s View of International Arbitration (Global Pound Lecture Series,
Leboulanger law firm, Paris, France, 2018)
The Notion of “Pro-Arbitration” (keynote address at Univ. of Pennsylvania
Arbitration Day, Philadelphia, Pa., 2018)
From the FAA to the Restatement of Arbitration Law: Taking Stock of
American Arbitration Law (inaugural address, Bucerius Law School, Center for
International Dispute Resolution, Hamburg, Germany, 2018)
Current Key Topics in International Arbitration (keynote address, Chinese
Academy of Social Sciences, Beijing, China, 2017)
Closing Address, centennial conference of Chartered Institute of Arbitrators
on Synergy and Divergence between Civil Law and Common Law in
International Arbitration (Paris, France, 2017)
What Does it Mean to be “Pro-Arbitration”? (Alexander Lecture, Chartered
Institute of Arbitrators, London, UK, 2017)
EU Competition Law and Arbitration (keynote address, Arbitration Institute
of the Stockholm Chamber of Commerce, Stockholm, Sweden, 2017)
Twilight Issues in International Arbitration (keynote address, Universidad
Carlos Vallejo, Lima, Peru, 2017)
Viewing Arbitration through a Critical Lens (keynote address, annual
congress of Centro de Estudios de Derecho, Economía y Política (CEDEP), La
Paz, Bolivia, 2017)
Extension of Arbitration Agreements to Non-Signatories (keynote address,
Vilnius Arbitration Day, Vilnius, Lithuania, 2016)
International Commercial Arbitration: Past, Present and Future (keynote
address, International Arbitration Summit, Cravath, Swain & Moore, New York,
NY, 2014)
The Arbitrability Trap (John E. C. Brierley Memorial Lecture, McGill Univ.,
Montreal, Canada, 2012)
International Arbitration: Where from Here? (Wing-Tat Lee Distinguished
Lecture in International and Comparative Law, Loyola Univ. School of Law,
Chicago, Ill., 2011)
American Exceptionalism in International Arbitration (keynote address,
6th Annual Arbitration & Mediation Conference, Fordham Law School, New
York, NY, 2011)
ABOUT GEORGE A. BERMANN xxxix
Gateway Issues in International Commercial Arbitration (keynote address,

International Chamber of Commerce, Young Arbitrators Forum, Paris, France,
2011)
A Restatement of International Commercial Arbitration (C.V. Starr Lecture,
New York Law School, New York, NY, 2009)
Other Presentations and Publications

Twilight Issues in International Arbitration (Chartered Institute of
Arbitrators, Brazil branch, 2021)
Twilight Issues in International Arbitration (Venezuela Chamber of
Commerce Arbitration Commission, 2021)
Effective Arbitral Advocacy (Thailand Arbitration Center, Young ICCA
webinar, Bangkok, Thailand, 2021)
What Does it Mean to Be Pro-Arbitration? (presentation at Holland &
Knight, LLP, Miami, 2020)
Crimea in the Investment Dispute Crossroads between Russia and Ukraine
(Odessa Academy of International Law, Odessa, Ukraine, 2019)
Twilight Issues in International Arbitration (Univ. of Coimbra, Portugal,
2019)
Intra-EU Investment Protection in a Post-Achmea World, Columbia F.D.I.A.
Perspective, no. 266 (2019)
Book Review, Jean E. Kalicki & Anna Joubin-Bret, Reshaping the Investor-
State Dispute Resolution System (Brill Pub.), 31 ICSID Rev. 232 (2016)
Book Review, Thomas Carbonneau, Toward a New Federal Arbitration Act
(Oxford Univ. Press), Global Arb. Rev. (2016)
Chair, Workshop on Twilight Issues in International Arbitration (New York
International Arbitration Center, New York, NY, 2016)
Moderator, International Arbitration amid Other International Regimes
Moderator, Legitimacy in International Arbitration (Columbia Arbitration
Day, Columbia Law School, New York, NY, 2016)
The International Arbitration Restatement and its Controversies (presentation
at Jones Day, LLP, New York, NY, 2016)
Moderator, International Arbitration and the Courts (Columbia Univ. Global
Center, Amman, Jordan, 2015)
Moderator, Arbitration in the Arab World (Columbia Global Center, Amman,
Jordan, 2015)
Book Review, Peter Rutledge, Arbitration and the Constitution (Cambridge
Univ. Press), 24 Am. Rev. Int’l Arb. (2013)
Moderator, Challenges to International Commercial Arbitration: A View
from the ICC (Columbia Law School, New York, NY, 2013)
Moderator, panel on Exclusion of Judicial Recourse in Arbitration
xl ABOUT GEORGE A. BERMANN
Moderator, Arbitration Debates (event in memory of Hans Smit, Columbia

Law School, New York, NY, 2013)
Seminar on International Arbitration Issues for US Judges (US district court
for the eastern district of New York, 2009)
The Arbitral Award: An Arbitrator’s Perspective, in An Arbitration
Checklist 59 (L. Newman & R. Hill, eds., Juris Pub. 2003)
B. TRANSNATIONAL LITIGATION
Books
Transnational Litigation (2d ed., West Pub. 2021)

“Anti-Suit Injunctions,” in Max Planck Encyclopedia of International Law
(Oxford U. Press 2019)
Litigation in the Civil law and Common Law: The Basics, in Litigation
Strategies and Practice (B. Legum & E. Berghoff, eds., 2d ed. 2014)
Parallel Jurisdiction: Is Convergence Possible?, 21 Ybk of Priv. Int’l L. 21
(2012); also in Convergence and Divergence in Private International Law
(festschrift for Kurt Siehr) (K. Boele-Woelki et al., eds., Schultess Pub. 2010)
US Class Actions and the “Global Class,” 19 Kan. J. L. & Pub. Policy 91 (2009)
Parallel Litigation and the Transnational Civil Procedure Rules, Rev. It.
Diritto Privado 2007)
The Application of Private International Law Norms to Third Countries:
The Jurisdiction and Judgments Example, in International Civil litigation in
Europe and Relations with Third States 55 (N. Watte & A. Nuyts, eds., Bruylant
Pub. 2005)
Provisional Relief in Transnational Litigation, 35 Colum. J. Transnat’l L. 553
(1997)
Transnational Provisional Relief in the Court, in International Dispute
Resolution: The Regulation of Forum Selection 99 (J.L. Goldsmith, ed., 1996)
The Use of Anti-Suit Injunctions in International Litigation, 28 Colum. J.
Transnat’l L. 501 (1989)
The Hague Evidence Convention in the Supreme Court: A Critique of the
Aérospatiale Decision, 63 Tulane L. Rev. 525 (1989)
Public Law in the Conflict of Laws, 34 Am. J. Comp. L. (Supp.) 157 (1986)

The Bases for Jurisdiction in Private International Disputes (annual meeting,
American Society of International Law, Washington DC, 2017)
Punitive Damages in International Dispute Resolution (conference on
dommages punitifs at Univ. of Nancy, Nancy, France, 2013)
Transnational Law of Commercial Contracts (conference on Stateless Law,
McGill Univ., Montreal, Canada, 2012)
ABOUT GEORGE A. BERMANN xli
Techniques of Parallel Litigation in International Litigation (Univ. of

Tŭbingen, Tŭbingen Germany, May 25, 2011)
The UK Supreme Court in its First Year: An American Perspective (Queen
Mary College, Univ. of London, London, UK, 2010)
Emerging Issues in International Civil Litigation (European Univ. Institute,
Fiesole, Italy, 2010)
The Impact of Uniform Law on National Law: Limits and Possibilities
(International Academy of Comparative Law, 1st Intermediate Congress,
Universidad Nacional Autónoma de Mexico, Mexico City, Mexico, 2010)
Introduction to Private International Law for US District Court Judges
(International Judicial Academy, Federal district Court for the eastern district
of New York, Brooklyn, NY, 2009)
The Challenges of Parallel Litigation (Asociacion Americana de Derecho
Internacional Privado, Caracas, Venezuela, 2009)
US Class Actions and the Global Class (presentation to Columbia Law
faculty, 2009)
Harmonization and Unification of Private Law (International Academy of
Comparative Law, Mexico City, Mexico, 2008)
Recognition and Enforcement of US Class Action Judgments Abroad (annual
meeting, International Bar Association, Buenos Aires, Argentina, 2008)
Class Actions and Europe (ABA/IBA conference, Rome, 2007)
The New Hague Choice of Court Convention (International Law Weekend,
NYC Bar Association, New York, NY, 2006)
The Transnational Civil Procedure Rules and Parallel Litigation (Univ. of
Trieste, Italy, Institute of Comparative Private Law, Trieste, Italy, 2005)
Parallel Litigation in the United States (annual meeting, ABA International
Law Section Annual Meeting, New York, NY, 2004)
The Application of Private International Law Instruments to Third
Countries (Univ. of Barcelona, 2003)
The Expatriation of US Statutory Claims (American Foreign Law Association,
New York, NY, 2003)
Transnational Provisional Relief in the Courts (Univ. of Virginia School of
Law, Charlottesville, Va., 1996)
Civil Procedure: Towards a Modern ius commune (colloquium of International
Association of Legal Science, Universidad Argentina de la Empresa, Buenos
Aires, Argentina, 1995)
Le dualisme juridictionnel: le débat aux Etats-Unis (French Senate, Paris,
France, 1990)
Anti-suit Injunctions in International Litigation (International Law Weekend,
NYC Bar Association, New York, NY, 1989)
Public Law in the Conflict of Laws, Twelfth World Congress of Comparative
Law, Sydney-Canberra, Australia, 1986)
xlii ABOUT GEORGE A. BERMANN

Solving the Puzzles of Parallel Litigation (graduation speaker, City Univ. of
Hong Kong, Program in legal education for mainland Chinese judges, 2010)
US Class Actions and the “Global Class” (inaugural lecture, Robert Casad
Lecture Series, Univ. of Kansas Law School, Lawrence, Kan., 2008)

Examining Expert Witnesses (12th annual Moscow dispute resolution
conference, 2020)
Restatements and International Law (conference in honor of Prof. Andreas
Lowenfeld, New York Univ. School of Law, New York, NY, 2009)
Transnational Law in the First-Year Curriculum (annual meeting, Association
of American Law Schools, San Francisco, California, 2005)
Policy Recommendations for Dispute Prevention and Dispute Settlement
in Transatlantic Relations (European Univ. Institute, Fiesole, Italy, 2002)
Constitutional Jurisdiction of US Courts over Non-Nationals, Univ. of Paris
I (Sorbonne), Paris, France, 1998)
C. EUROPEAN UNION LAW
Books
Cases and Materials on European Union law (with E. Fox, D. Gerard,
F. Emmert, J. Atik & R Goebel (4th ed. 2015))
Guide to European Union Administrative Law (ABA Pub. 2008)
Introduction to French Law (with E. Picard) (Kluwer 2008)
French Business Law in Translation (with P. Kirch) (2d. ed. Juris Pub. 2008)
Law and Governance in an Enlarged European Union (ed. with K.Pistor)
(Hart Pub. 2004)
Regulatory Federalism: European Union and United States (Hague
Academy of International Law), 263 Recueil des Cours de l‘Académie de Droit
International de la Haye 9 (1997)

The European Law Institute: A Transatlantic Perspective (festschrift for
Prof. Bernard Audit) (LGDJ Pub. 2015)
Une vue outre-atlantique de la Cour et de sa jurisprudence, in The Court of
Justice and the Construction of Europe: Analysis and Perspectives on Sixty
Years of Case Law 719 (T.M.CV. Asser Press 2013)
Comparing US Law and the Law of the European Union (festschrift for Prof.
Camille Jauffret-Spinosi) (Dalloz 2012)
Restatement of European Administrative Law: Problems and Prospects, in
Comparative Administrative Law (S. Rose-Ackerman & P. Lindseth, eds.,
Edward Elgar Pub. 2010)
ABOUT GEORGE A. BERMANN xliii
New Frontiers in the Relationship between National and European Courts,

32 Fordham Int’l L. J. 601 (2009)
Americanization and Europeanization of Law: Are there Cultural Aspects?, in
Sesquicentennial Essays of the Faculty of Columbia Law School (2008)
National Parliaments and Subsidiarity: An Outsider’s View, in The Lisbon
Treaty: The Irish “No” 453 (I. Pernice, ed., Nomos 2008)
Constitutional Lessons from Europe (festschrift for Francis Jacobs), 29
Ford Intl L.J. 601 (2006)
The Highest Court in Federal Systems, in The Future of the European
Judicial system in a Comparative Perspective 91 (eds., I. Pernice et al., eds.,
Nomos 2006)
Executive Power in the New European Constitution, 3 Int’l J. Const’l L. 440-47
(2005)
Marbury v. Madison: Implications for European Law, 36 G.W.U. Int’l L. Rev.
557 (2004)
Competences of the Union, in European Union Law for the 21st Century: Re-
thinking the New Legal Order 65 (T. Tridimas & P. Nebbia, eds., Hart Pub.,
Oxford Univ. Press 2004)
The Constitutional Convention and EU Institutional Reform, in The
Government of Europe: Which Institutional Design for the European Union?
119 (J.M. Beneyto Perez & I. Pernice, eds., Nomos 2004)
Member State Liability in the Member State’s Own Court: An American
Comparison, in Une communauté de droit (festschrift for President Gil Carlos
Rodriguez Iglesias, European Court of Justice) 305 (BWV Pub. 2003)
Proportionality and Subsidiarity; in The Law of the Single European Market:
Unpacking the Premises 75 (C. Barnard & J. Scott, eds., Hart Pub. 2002)
Law in an Enlarged European Union, in Law and Laws in a Multi-State
System 555 (festschrift in honor of Prof. Arthur von Mehren) (S. Symeonides
& J. Nafziger, eds., Transnational Pub. 2002)
European Law: Yesterday, Today and Tomorrow, 36 Texas Int’l L.J. 525
(2001)
Basic Principles for the Allocation of Competence in the United States and
the European Union (with K. Nicolaidis), in The Federal Vision 483 (K. Nicolaidis
& R. Howse, eds., Oxford Univ. Press 2001)
Implications of Membership in the European Union for a Constitutional
Settlement in Cyprus (opinion to the Attorney-General of Cyprus, published in
“Cyprus and European Membership,” Press and Information Office, Republic of
Cyprus, Nicosia, Cyprus 2001)
Legal Aspects of the New European Single Currency, 4 Colum. J. Eur. L. 353
(1998)
The European Intergovernmental Conference: An American Perspective
(festschrift for Prof. Peter Herzog), 25 Syracuse J. Int’l L. & Comm. 61 (1998)
Regulatory Decisionmaking in the European Commission, 1 Colum. J. Eur.
L. 415 (1996)
xliv ABOUT GEORGE A. BERMANN
Regulatory Cooperation between the European Commission and US

Administrative Agencies, 9 Adm. L.J. of Amer. Univ. 933 (1996)
The Constitutional Amendment Process, in The European Constitutional
Area 291 (R. Bieber & P. Widmer, eds., 1995)
European Community Law from a US Perspective, 4 Tulane J. Int’l & Comp.
L. 1 (1995)
Taking Subsidiarity Seriously: Federalism in the European Community
and the United States, 94 Colum. L. Rev. 331 (1994)
Subsidiarity as a Principle of US Constitutional Law, 42 Am. J. Comp. L.
(Supp.) 555 (1994)
Subsidiarity and the European Community, in Post-Maastricht Europe 153
(P. Lützeler, ed., 1993)
EEC Community-Building under the Single European Act, in Comparative and
Private International Law 333 (festschrift for John Henry Merryman) (D. Clark,
ed., 1990)
The Single European Act: A New Constitution for the Community, 27
Colum. J. Transnat’l L. 529 (1989)
Federalism: European and American, in Two Hundred Years of US
Constitution and Thirty Years of EEC Treaty 75 (K. Lenaerts, ed., 1988)
French Treaties and French Courts: Two Problems in Supremacy, 28 Int’l
& Comp. L.Q. 458 (1979)

Moderator, The Clash between Constitutional and International Norms:
The Kadi Case and its Implications (conference in honor of Louis Henkin,
Comments on 20th Anniversary of Joseph Weiler’s “The Transformation of
Europe” (Yale Law School, New Haven, Conn, 2011)
The European Law Institute: Comments from a Transatlantic Perspective
(inaugural congress of European Law Institute, Paris, France, 2011)
Launching the European Law Institute (European Public Law Organization,
Cape Sounian, Athens, Greece, 2011)
Observations sur la primauté du droit communautaire sur les constitutions
nationales, in Regards croisés sur l’internationalisation du droit: France -
Etats-Unis, Société de Législation Comparée, Paris, France (2009)
The Rome I Regulation: A Comparative View (Univ. of Verona, Verona,
Italy, 2009)
The Kadi case of the European Court of Justice (New York Univ. School of
Law, New York, NY, 2008)
National Parliaments and Subsidiarity: An Outsider’s View (European
Constitutional Law Network, Univ. of Sofia, Bulgaria, 2008)
European Citizenship at Center-Stage, 15 Colum. J. Eur. L. 165 (2008)
Legal Aspects of Turkish Accession to the EU (NYC Bar Association, New
York, NY, 2007)
ABOUT GEORGE A. BERMANN xlv
The Law of the European Union (18th annual Harold R. Medina Seminar for
State and Federal Judges in the Humanities and Science, Princeton Univ.,
Princeton, NJ, 2007)
Les cours constitutionnelles européènnes et l’intégration des normes
communautaires (Cardozo School of Law, New York, NY, 2007)
The Move Towards an Integrated European Administration (Univ. of
Luxembourg, Luxembourg, 2007)
European Union Law in Transatlantic Perspective (general course of the
annual Academy of European Law, European Univ. Institute, Fiesole, Italy, 2006)
The European Constitution (International Conference on Comparative
Constitutional Law, Univ. of Nice, Nice, France, 2004)
Executive Power under the Draft European Constitution (New York Univ.
School of Law, New York, NY, and Princeton Univ., Princeton, NJ, 2004)
What’s Constitutional about the New European Constitution? (Columbia
Law School, New York, NY, 2003)
The New Draft Constitution of Europe (Univ. of Lisbon, Portugal, 2003)
The European Union and its New Federalism (Princeton Univ., Princeton,
NJ, 2003)
The Treaty Basis for European Judicial Cooperation in Civil and Commercial
Matters (NYC Bar Association, New York, NY, 2003)
The Competences of the EU under the New Draft Constitution (Institute for
Advanced Legal Studies, Univ. of London, London, UK, 2003)
The Accession of Cyprus to the EU: Challenges and Opportunities (Columbia
Univ. Institute for the Study of Europe, Columbia Univ., New York, NY, 2003)
Marbury v. Madison: Implications for European Law (George Washington
Univ. College of Law, Washington DC, 2003)
European Union Governance after Enlargement (Columbia Law School,
New York, NY, 2003)
Developments in Law and Federalism in the EU (7th biennial conference of
the European Union Studies Association, Nashville, Tenn., 2003)
The Constitutional Convention and EU Institutional Reform (Univ. of
Madrid, Madrid, Spain, 2003)
Making Member States Comply with Community Law (6th biennial conference
of the European Community Studies Association, Madison, Wis., 2001)
European Union: Between Law and Politics (Federal Judicial Center and
Princeton Univ., Princeton, NJ, 2001)
Law in an Enlarged European Union 6th biennial conference of the European
Community Studies Association (Madison, Wis., 2001)
Free Movement of Services: European Union Lessons for NAFTA (U.S-Mexico
Law Institute, Santa Fe, N.M., 2000)
Flexibility in the EU: A Critique of the Amsterdam Treaty’s Provisions on
“Closer Cooperation” (School of International and Public Affairs, Columbia
Univ., New York, NY, 2000)
xlvi ABOUT GEORGE A. BERMANN
European Law: Yesterday, Today and Tomorrow (Univ. of Texas, Austin,

Tex., 2000)
The European Commission: The World’s Most Powerful Administrative
Agency? (annual meeting, Association of American Law Schools, Washington DC,
2000)
The Treaty of Amsterdam: Institutional Reforms (International Law
Weekend, NYC Bar Association, New York, NY, 1997)
Legal Aspects of the New European Single Currency (Washington Univ. in
St. Louis School of Law, St. Louis, Mo., 1997)
The Idea of Europe: A Legal Dimension, Princeton Univ., Alumni College
(Princeton, NJ, 1997)
An American Perspective on the Intergovernmental Conference (Free
Univ. of Brussels, Belgium, 1997)
Decisionmaking Aspects of the European Commission (annual meeting,
Association of American Law Schools, New Orleans, La., 1995)
Regulatory Cooperation between European Commission and US Agencies
(Administrative Conference of the United States, Washington, DC, 1994)
Subsidiarity as a Principle of US Constitutional Law (XIVth Congress of the
International Academy of Comparative Law, Athens, Greece, 1994)
The Interstate Commerce Clause: Lessons for the European Community
(European Commission Legal Service, Brussels, Belgium, 1994)
Post-Maastricht Europe (International Law Weekend, NYC Bar Association,
New York, NY, Oct. 29, 1993)
Subsidiarity and the European Community (Washington Univ. in St. Louis,
St. Louis, Mo., 1993)
Taking Subsidiarity Seriously (Department of Justice of Canada, Ottawa,
Canada, 1993)
Subsidiarity and Federalism (Univ. of California at Hastings, San Francisco,
Ca., 1993)
Europe after the French Referendum on Maastricht (NYC Bar Association,
Comparative and Foreign Law Committee, New York, NY, 1992)
The Constitution and the Courts in France, 27 Am. J. Comp. L. 583 (1979)

Data Privacy Protection: Cooperation and Conflict between the EU and US
(inaugural address, Institute on Media and Information Law, Univ. of Freiburg,
Germany, 2011)
European Community Law from a US Perspective (Eason-Weinmann
Distinguished Lecture, Tulane Law School, New Orleans, La., 1994)

The Law in European Union Law (annual Medina Conference for members
of the U.S. state and federal judiciary, Princeton Univ., Princeton, NJ, 2016)
ABOUT GEORGE A. BERMANN xlvii
A Transatlantic Perspective on EU Law (Columbia Law School Alumni

Association, Allen & Overy LLP, London, UK, 2006)
Moderator, EU Competition Law on the Eve of Enlargement (Columbia Law
School, New York, NY, 2004)
The European Union as a Constitutional Experiment (Columbia Law School
Lecture Series on Challenges of International Governance Regimes, New York,
NY, 2004)
Introduction to the Decennial Volume, 10 Colum. J. Eur. L. 1 (2003)
Book Review, Lisa Conant, Justice Contained: Law and Politics in the European
Union (Cornell Univ. Press), Eur. Union Stud. Ass’n Rev. (Apr. 2003)
European Law and European Enlargement (British Institute of International
and Comparative Law, London, UK, 2001)
Law in an Enlarged European Union (School of International and Public
Affairs, Columbia Univ., New York, NY, 2001)
Book Review, Eric Stein, Thoughts from a Bridge (Univ. of Michigan Press),
94 Am. J. Int’l L. 826 (2000)
Introduction, Special Issue: European Identity and the Opposing Pulls of
Globalization, Nationalism and Regionalism, 5 Colum. J. Eur. Law 365 (1999)
An American Perspective on the 1996 European Intergovernmental
Conference, Universities of Berlin (Humboldt Univ.), Bonn, Erlangen-Nüremberg
and Munich, Germany, 1997)
Subsidiarity: Does it Have a Future? (Univ. of Rome La Sapienza, Rome,
Italy, and Swiss Institute of Comparative Law, Lausanne, Lausanne, Switzerland,
1997)
Regulatory Practice in the European Commission (American Bar Association,
Section of Administrative Law and Regulatory Practice, Baltimore, Md., 1996)
Book Review, Ami Barav & Christian Philip, Dictionnaire juridique des
communautés européennes (Presses Universitaires de France), 1995 Rev. Int’l
de Droit Comparé 260 (1995)
Introduction, Symposium on Harmonization in the European Community,
29 Colum. J. Transnat’l L. 7 (1991)
Book Review, M. Cappelletti, M. Seccombe, & J. Weiler, Integration through
Law: Europe and the American Federal Experience (de Gruyter Pub.), 11
Fordham, Int’l L.J. 232 (1987)
The Single European Act: A New Constitution for the Community? (Carnegie
Council on Ethics and International Affairs, New York, NY, 1987)
French Public Law, in The World’s Legal Systems: Past and Present (G.
Bermann & J. Hazard, eds., Condyne Audio Tape Series 1985)
The Law of the European Economic Community, in The World’s Legal
Systems: Past and Present (G. Bermann & J. Hazard, eds. (Condyne Audio Tape
Series 1985))
xlviii ABOUT GEORGE A. BERMANN
D. COMPARATIVE LAW
Books
Party Autonomy: Constitutional and International Limits in Comparative
Perspective (Juris Pub. 2005)

Enforcing Legal Norms through Private Means, in Enforcement and
Effectiveness of the Law (Reports of the Montevideo Congress of the International
Academy of Comparative Law) (Springer Pub. 2019)
Comparative Law and International Organizations, in The Cambridge
Companion to Comparative Law (Mauro Bussani & Ugo Mattei eds., Cambridge
Univ. Press 2012)
La protection des droits de l’individu aux Etats-Unis: proportionnalité et
federalisme, in Droit global: Des droits au droit: les droits de la personne,
fondement du droit 41 (L. Vogel, ed., Institut de Droit Comparé 2007)
Bilingualism and Translation in the US Legal System: A Study of the
Louisiana Experience, in 54 Am. J. Comp. L. (Supp.) 89 (2006)
The Constitution, International Treaties and Contracts, in Convergence of
Legal Systems in the 21st Century 1073 (G. Moens, ed., Bruylant Pub. 2006)
Le droit comparé et le droit international: alliés ou ennemis?, 2003 Rev.
int’l droit comparé 519 (2003)
The Role of Law in the Functioning of Federal Systems, in The Federal
Vision 191 (K. Nicolaidis & R. Howse, eds., Oxford Univ. Press 2001)
The Discipline of Comparative Law in the United States, 1999 Rev. int’l de
droit comparé 1041 (1999)
Judicial Enforcement of Federalism Principles, in Entwicklungs Perspektiven
der Europaischen Verfassung im Lichte des Vertrags von Amsterdam 64
(M. Klöpfer & I. Pernice, eds., Nomos 1999)
Comparative Law in the New European Community, 21 Hastings Int’l &
Comp. L. Rev. 865 (1998)
Judicial Enforcement of Federalism Principles (inaugural conference of
Walter Hallstein Institute of European Constitutional Law, Humboldt Univ.,
Berlin, Germany, 1998)
La Codification aux Etats-Unis, 82 Revue française d’administration publique
221 (1997)
Comparative Law in Administrative Law, in L’Etat de droit 29 (festschrift
for Guy Braibant) (Dalloz 1996)
Harmonization of Law and Regulatory Federalism, in Harmonization of
Legislation in Federal Systems (I. Pernice, ed., 1996)
The Constitutional Amendment Process (Swiss Institute of Comparative
Law and Univ. of Lausanne, Lausanne, Switzerland, 1995)
ABOUT GEORGE A. BERMANN xlix
Bijuralism in Federal Systems and in Systems of Local Autonomy (with

M. Hilf), in General Reports of the XIIIth International Congress of the
International Academy of Comparative Law 21 (Editions Yvon Blais 1992)
Le dualisme juridictionnel: le débat aux Etats-Unis, in Le dualisme
juridictionnel 56 (G. Timsit, ed., 1990)
Le régime juridique des fondations aux Etats-Unis, in Le droit des
fondations en France et à l’etranger, in La Documentation Française, Notes et
Etudes Documentaires, no. 487965 (1989)
Equality, Minorities and Pluralism (Columbia Univ. Center for the Study of
Human Rights, Columbia Univ., New York, NY, 1989)
The Legal Uniqueness of the Italian Constitution (colloquium on the Fortieth
Anniversary of the Italian Constitution, Columbia Univ., New York, NY, 1988)
Le régime juridique des fondations aux Etats-Unis (Collège de France,
Paris, France, 1988)
The Legal Uniqueness of the Italian Constitution, 2 Italian Journal 5 (1988)
Federalism: European and American (Leuven Univ., Leuven, Belgium, 1987)
Les instruments juridiques de la politique foncière aux Etats-Unis, in Les
instruments juridiques de la politique foncière : Etudes comparatives portant
sur quatorze pays occidentaux (M. Fromont, ed., 1978)

Applicable Law and the Civil and Common Law Divide (Cour européènne
d’arbitrage, 2020)
Les Porosités du droit (American Univ. School of Law, Washington DC, 2017)
Docket Management and Control: A Comparative Perspective (seminar
with judges of US Supreme Court and European Court of Justice, at joint
symposium at European Court of Justice, Luxembourg, 2014)
An Agenda for Dialogue: the US Supreme Court and European Court of
Justice (seminar with judges of US Supreme Court and European Court of
Justice, at joint symposium at European Court of Justice, Luxembourg, 2012)
Paris in America: Edouard Laboulaye and Stephen Breyer (conference of
the Collège de France, Paris, France, 2011)
Introduction to 19th World Congress of Comparative Law (law schools of
American Univ., George Washington Univ. and Georgetown Univ., Washington
DC, 2010)
European Human Rights Convention: Lessons for the Interamerican
System (Columbia Law School, New York, NY, 2008)
Constitutional Adjudication in the EU and US (seminar with judges of US
Supreme Court and European Court of Justice, at joint symposium at European
Court of Justice, Brussels, Belgium, 2007)
Americanization and Europeanization of Law: Are there Cultural Aspects?,
(Cornell Law School, Ithaca, NY, 2007)
l ABOUT GEORGE A. BERMANN
Bilingualism and Translation in the US Legal System: A Study of the

Louisiana Experience (17th International Congress of Comparative Law, Utrecht,
the Netherlands, 2006)
Americanization and the Law (annual meeting, Association of American
Law Schools, Washington, DC, 2006)
The “Highest” Court in Federal Systems (Humboldt Univ., Berlin, Germany,
2005)
Constitutionalism in Federal Systems: The European Example (annual
meeting, American Society of Comparative Law, Univ. of Hawaii, Honolulu,
Hawaii, 2005)
Americanization and Europeanization: Some Legal Perspectives (St.
Anthony’s College, Oxford Univ., Oxford, UK, 2005)
A US View of the European Model (4th Vienna Globalization Symposium,
Austrian Chamber of Commerce, Vienna, Austria, 2003)
Le droit comparé et le droit international: alliés or ennemis? (Cour de
Cassation, Paris, France, 2003)
Comparative Law in Multi-State Practice (Harvard Law School, Cambridge,
Mass, Oct. 27, 2002)
The Judicial Role in Policing Federalism: The US and the EU (Center for
European Law, Cambridge Univ., UK, 2002)
Proceduralization of Law and the Transformation of Adjudicative Functions
in the EC and the WTO (Univ. of Wisconsin, Madison, Wis., 2001)
Proportionality and Subsidiarity (Cambridge Univ., Cambridge, UK, 2001)
The Future of Comparative Law (Centennial Congress of Comparative Law,
Tulane Law School, New Orleans, La., 2000)
The Transatlantic Dimension of US and EU Federalism (paper delivered at
Kennedy School of Government, Harvard Univ., 1999)
The Supreme Court’s Role in Policing US Federalism (seminar with judges
of US Supreme Court and European Court of Justice, at joint symposium at
European Court of Justice, Luxembourg, 1998)
The Contemporary Use of Comparative Law in Law Reform (annual meeting,
Association of American Law Schools, San Francisco, Ca., 1993)
Le Dialogue entre les entreprises et le gouvernement fédéral aux Etats-Unis
(Commission pour l’Etude des Communautés Européennes (CEDECE), Univ. of
Paris II, Paris, France, 1992)
Communitarianism and the Law (annual meetings, American Society of
Comparative Law and International Association of Legal Science, Provo, Utah,
1992)
The Impact of European Integration on Private Law (Univ. of Helsinki,
Helsinki, Finland, 1992)
1992: The European Community at a New Crossroads (annual meeting,
American Society of International Law, Washington, DC, 1991)
The Principle of Proportionality (10th World Congress of Comparative
Law, Budapest, Hungary, 1978)
ABOUT GEORGE A. BERMANN li
Les instruments juridiques de la politique foncière aux Etats-Unis, in Report

on United States Law, in Les instruments juridiques de la politique foncière des
villes : Etudes comparatives portant sur quatorze pays occidentaux 329 (M.
Fromont, ed., 329, Dijon, France, 1978)

Comparative Law: Problems and Prospects (closing plenary session of
International Congress of Comparative Law, Washington, DC, 2010)

Marek Safjan: A Comparative and International Law Colleague (festschrift
for Marek Safjan), Univ. of Warsaw faculty of law, Warsaw, Poland (2019)
Moderator, “The Right to be Forgotten” (seminar between judges of US)
New Directions in Comparative Law Scholarship (annual meeting, American
Society of Comparative Law, Univ. of Washington, Seattle, Wash., 2016)
The Supreme Court and European Court of Justice (US Supreme Court,
Washington, DC, 2017)
Table ronde sur l’université d’aujourd’hui (Centre de Droit Comparé, Paris,
France, Nov. 6, 2009)
Introduction, Justice Sandra Day O’Connor: Recipient of 2008 Wolfgang
Friedmann Award, 47 Colum. J. Transnat’l L. 1 (2008)
“Transparency,” in 3 Encyclopedia of Law and Society: American and
Global Perspectives 1503-1505 (David S. Clark, ed., Sage Pubs. 2007)
Introduction to the Centennial World Congress of Comparative Law
(Tulane Law School, New Orleans, La., 2000)
E. INTERNATIONAL LAW & INTERNATIONAL TRADE
Books
The International Trade Law of Contingent Protection (ed. with P.
Mavroidis & K. Bagwell, vol. 3 Columbia Law Series on WTO Law and Policy)
(Cambridge Univ. Press 2009)
WTO Law and Developing Countries (ed. with P. Mavroidis, vol. 2 Columbia
Law Series on WTO Law and Policy) (Cambridge Univ. Press 2007)
World Trade and Human Health and Safety (ed. with P. Mavroidis) vol. 1
Columbia Law Series on WTO Law and Policy) (Cambridge Univ. Press 2006)
Transatlantic Regulatory Cooperation: Legal Problems and Political
Prospects (ed. with M. Herdegen & P. Lindseth) (Oxford Univ. Press 2001)
Regulatory Cooperation with Counterpart Agencies Abroad: The FAA’s
Aircraft Certification Experience, 24 Law & Policy in Int’l Bus. 669 (1993), also
published in Administrative Conference of the US, Recommendations and
Reports 63-172 (1991)
lii ABOUT GEORGE A. BERMANN

The Emergence of Transatlantic Regulation, in Legal Challenges in EU
Administrative Law 168 (H. Hofmann & A. Turk, eds., Elgar Pub. 2009)
The American Law Institute Goes Global, 16 Willamette J. Int’l L. & Disp.
Resol. 300 (2008)
The Emergence of Transatlantic Regulation, in The Move to an Integrated
Administration (H. Hoffmann & A. Turk, eds, Elgar Pub. 2008)
La concertation reglementaire transatlantique, in Vers de nouveaux équilibres
entre ordres juriidiques (festschrift for Helene Gaudemet-Tallon) (Dalloz 2008)
The Emergence of Transatlantic Regulation, in Economic Law and Justice
in Times of Globalisation (festschrift for Judge and Prof. Carl Baudenbacher)
275 (Nomos 2007)
Policy Recommendations for Dispute Prevention and Dispute Settlement
in Transatlantic Relations: Legal Perspectives, in Transatlantic Economic
Disputes: the EU, the US, and the WTO 569 (E-U Petersmann & M. Pollack, eds.,
Oxford Univ. Press 2003)
Regulation and Market Liberalization: A Comparative Analysis, in Regolazione
e Concorrenza 27 (G. Tesauro & M. D’Alberti, eds. 2000)
Constitutional Implications of US Participation in Regional Integration, 46
Am. J. Comp. L. (Supp.) 463 (1998)
Managing Regulatory Rapprochement: Institutional and Procedural
Approaches, in Regulatory Co-Operation for an Interdependent World 73
(OECD Pub. 1994)
Managing International Regulatory Cooperation (Organization for Economic
Cooperation and Development (OECD), Paris, France, 1993)
Foreign Sources for Financing Privatization (Parker School of Foreign and
Comparative Law, Columbia Law School, New York, NY, 1993)
Les mesures de restriction aux exportations d’application extraterritoriale
dans les relations entre l’Europe et les Etats-Unis, in Les relations communauté
européènne 169 (J. Bourrinet, ed., 1987)
Contracts between States and Foreign Nationals: A Reassessment, in
International Contracts 184 (H. Smit et al., eds., Matthew Bender 1981)

Extraterritoriality in Anti-Corruption Law and Economic Sanctions (conference
of Alliance Program, Columbia Law School, New York, NY, 2018)
Extraterritorial Application of National Regulatory Law (Univ. of Paris I
(Sorbonne), Paris, France, July 9, 2018)
The Direct Effect of International Treaties in US Law (seminar with judges
of US Supreme Court and European Court of Justice, American Univ. School of
Law, Washington, DC, 2017)
The Fragmentation of the International Legal Order (annual meeting,
American Society of International Law, Washington DC, 2011)
ABOUT GEORGE A. BERMANN liii
The Social Dimension of International Law (conference of the réseau

juridique franco-américain, Collège de France, Paris, France, 2011)
Transatlantic Regulatory Networks (Southern Methodist Univ. Law School,
Dallas, Tex., 2008)
Transatlantic Regulation (fall meeting, ABA International Law Section,
Brussels, Belgium, 2008)
Non-State Law-Making in Int’l Law (Princeton Univ., Princeton, NJ, 2007)
La Concertation Reglementaire entre l’Union Européèenne et les Etats-
Unis (Univ. of Paris I (Sorbonne), Paris, France, 2007)
Globalization through Regulatory Dialogue (Princeton Univ., Princeton,
NJ, 2007)
Transatlantic Regulatory Dialogue (Center for European Legal Studies,
Univ. College London, London, UK and Europea Institute, Leiden Univ., Leiden,
the Netherlands, 2006)
Nested and Overlapping Institutions in International Law (Princeton Univ.,
Princeton, NJ, 2006)
Implementation of WTO Rulings (conference on the WTO and Dispute
Settlement and Developing Countries, Columbia Univ., New York, NY, 2006)
The Precautionary Principle in WTO Case Law (School of International and
Public Affairs, Columbia Univ., New York, NY, 2002)
Contracts, International Law and Constitutions (general report to the XVIth
Congress of the Int’l Academy of Comparative Law, Brisbane, Australia, 2002)
Non-Discriminatory Sanitary and Phytosanitary Standards: Lessons from
the Disputes over Hormones and Genetically Modified Organisms (European
Univ. Institute, Fiesole, Italy, 2001)
International Tribunals and United States Courts: A New Relationship for
the New Millennium (Second Circuit Judicial Conference, Sagamore Resort,
Bolton Landing, N.Y. 2001)
Transatlantic Regulatory Cooperation: Legal Problems and Political Prospects
(6th biennial conference of the European Community Studies Association,
Madison, Wis., 2001)
Federalism and the Treaty Power, (European Univ. Inst., Fiesole, Italy, 2000)
The WTO and Human Health and Safety (Trade Institute, Univ. of Berne,
Berne, Switzerland, 2000)
Genetically-Modified Organisms and Food Safety in US-EU Relations (Univ.
of Wisconsin, Madison, Wis., 2000)
The Federalism Dimension of Transatlantic Regulatory Cooperation
(Columbia Law School, New York, NY, 1999)
Federalism Obstacles to Effective US Participation in International Legal
Regimes (European Commission Legal Service, Brussels, Belgium, 1998)
Les mesures de restriction aux exportations d’application extraterritoriale
dans les relations entre l’Europe et les Etats-Unis (Commission pour l’Etude
des Communautés Européennes (CEDECE), Univ. of Aix-Marseille, Aix-en-
Provence, France, 1986)
liv ABOUT GEORGE A. BERMANN

La Concertation reglementaire transatlantique (Tocqueville-Fulbright
address, Univ. of Paris I (Sorbonne), Paris, France, Jan. 22, 2007)

The American Law Institute Goes Global (International Law Weekend
West, Willamette Law School, Salem, Ore., 2009)
The “International” American Law Institute (American Foreign Law
Association, New York, NY, 2009)
Trade Diplomats and Trade Academics (European Univ. Institute, Fiesole,
Italy, 2002)
Developments in International Trade and Regulatory Law (European Univ.,
Institute, Fiesole, Italy, 2001)
The States and Foreign Affairs (Center of International Studies, Princeton
Univ., Princeton, NJ, 2000)
F. ADMINISTRATIVE LAW
Administrative Law, in Introduction to the Law of the United States 92 (T.
Ansay & D. Clark, eds., Duncker & Humblot 1992)
Le droit administratif américain et le droit administratif français, 42
Conseil d’Etat, Etudes et Documents 169 (1990)
Federal Tort Claims at the Agency Level: The FTCA Administrative Process,
35 Case W. Res. L. Rev. 509 (1985)
Administrative Handling of Monetary Claims: Tort Claims at the Agency
Level, in Administrative Conference of the United States, Recommendations
and Reports 639-895 (1984)
La Responsabilité civile des fonctionnaires au niveau fédéral aux Etats-
Unis: vers la solution d’une crise, 1983 Rev. Int’l dr. comparé 319 (1983)
Occupational Licensing in New York State: A Report of the New York State
Bar Association, published in New York State Bar Association, New York State
Regulatory Reform 10 (1982)
Administrative Delay and its Control, 26 Am. J. Comp. L. (Supp.) 473 (1982)
The Principle of Proportionality, in Law in the USA in the Bicentennial Era
(J. Hazard & W. Wagner, eds.), 26 Am. J. Comp. L. (Supp.) 415 (1978)
Integrating Governmental and Officer Tort Liability, 77 Colum. L. Rev. 1175
(1977)
The Scope of Judicial Review in French Administrative Law, 16 Colum. J.
Transnat’l L. 195 (1977)
Les Droits de la défense: réflexions comparatives sur les droits
administratifs français et américain à propos d’un cas concret, Actualité Jurid.
Droit Adm. (AJDA) 410 (1975)
Bringing the Vagueness Doctrine on Campus (with B. Jamieson, Jr.), 80 Yale
L.J. 1261 (1971)
ABOUT GEORGE A. BERMANN lv

Codification of Administrative Procedure: The American Experience
(conference on “Towards an EU administrative procedure law?,” Office of
European Ombudsman, European Parliament, Brussels, Belgium, 2012)
Proportionality Principles in American Law (Univ. of Aix-Marseilles, Aix-
en-Provence, France, 2009)
Moderator, International Networks and Administrative Law (Yale Law
School, New Haven, Conn., 2009)
Toward a Restatement of European Administrative Law (Univ. of Osnabrück,
Osnabrück Germany, 2009)
Supranational Administrative Law: The EU Experience (Georgetown Law
Center, Institute of International Economic Law, Washington DC, 2007)
Comparative Administrative Law in the EU/US Regulatory Dialogue (annual
meeting, Association of American Law Schools, Washington, DC, 2007)
Introduction to “Immunity and Accountability: Is the Balance Shifting?,”
2005 ASIL Proceedings 227 (2006)
State and Public Official Immunities for International Law Violations (annual
meeting, American Society of International Law, Washington DC., 2005)
The Influence of European Union Law on French Administrative Law
(Univ. of San Diego and Univ. of California at San Diego, 2005)
European Union Administrative Law and Practice (ABA Administrative
Law Section, San Antonio, Tex., 2004)
Proportionality and Federalism in Recent Supreme Court Case Law
(Institut de Droit Comparé, Univ. of Paris II, Paris, France, 2001)
La Jurisprudence Administrative en Droit Francais (Conseil d’Etat, Paris,
France, 1999)
Regulation and Market Liberalization: A Comparative Analysis (Italian
Competition Authority, Rome, Italy, 1999)
Regulatory Federalism (Columbia-Frankfurt symposium on comparative
federalism, Columbia Law School, New York, NY, 1996)
Harmonization of Law and Regulatory Federalism, Columbia-Frankfurt
symposium on comparative federalism, Univ. of Frankfurt-am-Main (Frankfurt,
Germany, 1995)
Le droit administratif américain et le droit administratif français, Franco-
American Judicial Exchange (seminar of US Supreme Court justices, federal
circuit court judges and members of the French Conseil d’Etat, National
Archives, Washington DC, 1989)
The Premises of Government Liability (Administrative Conference of the
United States, Washington, DC, 1985)
Government in the Sunshine: Lessons from the American Experience (2d
Journées Juridiques Franco-Américaines, Paris, France, 1983)
Administrative Delay and its Control (11th World Congress of Comparative
Law, Caracas, Venezuela, 1982)
lvi ABOUT GEORGE A. BERMANN
Proliferation of Legislation and Regulation in the United States (Institut

International des Sciences Administratives, Karlovy-Vary, Czechoslovakia, 1982)
Keynote Addresses and Endowed lectures

Private Law Enforcement as a Public Law Enforcement Alternative (keynote
address, World Congress of International Academy of Comparative Law,
Montevideo, Uruguay, 2016)

Regulatory Federalism: A Reprise and Introduction, 2 Colum. J. Eur. L. 395
(1997)
US Administrative Law in Comparative Perspective (Univ. of Barcelona,
Barcelona, Spain, 1995)
Réflexions sur le droit administratif aux Etats-Unis, 1993-1994 (with
P. Lindseth), 46 Conseil d’Etat Etudes et Documents 515 (1994)
L’évolution du droit administratif américain 1992-1993 (with P. Lindseth),
45 Conseil d’Etat Etudes et Documents 483 (1993)
Administrative Procedure in the United States and in Western Europe
(National People’s Congress of the People’s Republic of China, Legislative Affairs
Commission, Beijing, China, 1991)
Government Liability in the United States, France, West Germany and the
European Economic Community (annual meeting, New York State Bar Association,
New York, NY, 1989)
Book Review, P. Schuck, Suing Government: Citizen Remedies for Official
Wrongs, 99 Pol. Sci. Q. 120 (1984)
Vermont Yankee and Judicial Review of Agency Rulemaking in the US (Univ.
of Clermont-Ferrand, Clermont-Ferrand, France (1982))
Governmental and Officer Liability in the United States (Univ. of Paris I
(Sorbonne), Centre d’Etudes du Common Law, Paris, France (1982))
Legislative, Executive and Judicial Control of Administrative Action (Univ.
of Lausanne, Lausanne, Switzerland (1982))
Proceduralism in American Administrative Law (Univ. of Paris I
(Sorbonne), Paris, France (1981))
Governmental Liability Reform in Germany and the United States (Max-
Planck-Institut fŭr Privatrecht und Internationales Privatrecht, Hamburg,
Germany and Univ. of Bonn, Bonn, Germany (1980))
Book Review, Z. Nedjati & J. Trice, English and Continental Systems of
Administrative Law, 28 Am. J. Comp. L. 105 (1980)
ABOUT GEORGE A. BERMANN lvii
George Bermann’s grandsons (left to right):

Henry Alexander, Jack William, Thomas George, Douglas Richard.
2022
George Bermann’s new grandson: Philip George.

2023
ABOUT THE EDITORS
Elora Neto Godry Farias is a Columbia Law School LL.M. (‘22) and an
International Attorney at Milbank LLP, in the São Paulo office.
Gino Rivas is a Columbia Law School LL.M. (‘22) and Professor at Pontificia
Universidad Católica del Perú, in Lima, Perú.
Gustavo Favero Vaughn is a Columbia Law School LL.M. (‘22) and an

International Lawyer at Cleary Gottlieb LLP, in the New York office.
Mateo Verdías Mezzera is a Columbia Law School LL.M. (‘22) and a

Visiting Lawyer at the International Arbitration and Litigation group of
Sullivan & Cromwell LLP, in the New York office.
ALONG WITH
Dr. Kabir A.N. Duggal is a Lecturer-in-Law at Columbia Law School and
the Managing Editor of the American Review of International Arbitration at
Columbia Law School.
lix
PART I
Faculty in International
Arbitration
Chapter 1
CONSENSUAL JUSTICE:
CHALLENGES AND PROMISES
Alejandro M. Garro*
I. INTRODUCTION
Figures recently gathered in major jurisdictions such as Sao Paulo and

Beijing reveal an ever-increasing number of commercial disputes that end up
being settled by arbitration. Many of those disputes are connected to more
than one country, and it does not take much to predict that arbitration will
continue to provide the most suitable method of dispute resolution for
effective planning of international business transactions.
Yet, despite its substantial achievements, this consensual model for settling
international disputes still faces one of its greatest challenges: Where and how
to find the answer to a myriad of questions which are not addressed in the
agreement of the parties or in the arbitral rules adopted by the parties. Rather
than being governed by a set of clear and predictable rules specifically addressing
international commercial disputes, a substantial number of recurring procedural
and quasi-procedural issues frequently arising during the course of an arbitration
remain anchored to some domestic law—be it the law governing the cause of
action, the law of the arbitral seat or of the place where the award may sought
to be enforced—instead of being governed by international or “transnational”
standards. I am referring to issues at on the borderline between procedure and
substance, such as (in no particular order of importance):
• Whether the parties have waived their right to arbitrate;

• The period of time within which an arbitral claim must be brought
(which in many jurisdictions may be considered a procedural question
subject to the law of the forum and in others, a matter of substance
governed by the law applicable to the merits;
• Whether the subject matter of the dispute is susceptible to being settled
by arbitration, a question closely connected to notions of “public policy”
or “international public policy” determining the annulment of the award
or barring its enforcement according to the law of the seat or of its
potential enforcement;
* Alejandro M. Garro is Adjunct Professor of Law and Senior Research Scholar at Columbia
University School of Law; and Honorary Professor of Law at the University of Buenos Aires. For
more than forty years, the author has had the privilege of working with, and learning from,
Professor George Bermann, to whom this short essay is dedicated.
3
4 PRO-ARBITRATION REVISITED
• Under which circumstances may a party who participated in the

arbitration but failed to sign an arbitration agreement may be deemed
nevertheless bound by such an agreement, or when a non-signatory
party may invoke an arbitration agreement;
• Which factors should or may an arbitral tribunal take into account in
order to award interim relief (including an anti-suit or anti-arbitration
injunction whenever necessary to enforce an arbitration agreement);
• Whether an arbitral tribunal should stay its proceedings when a similar
or identical cause of action has been previously brought in another
forum and is still pending (lis pendens) before a court or arbitral tribunal);
• Whether it should be permissible to raise in the pending arbitration an
issue which could or should have been raised in the previous action (res
judicata);
• How should an arbitral tribunal address evidentiary issues raised
during the course of an arbitration proceedings, purposedly left open
by the “lex arbitri,” such as who should bear the burden of producing
the evidence and whether a party may be compelled to produce, at an
early stage of the arbitration, evidence under its exclusive control,
presumably relating to an outcome-determinative issue;
• Which rules should govern the admissibility of testimonial and
documentary evidence disclosing privileged information;
• How to weight each piece of evidence to determine whether facts alleged
by a party should be deemed proven;
• Which standards should govern the allocation of costs, including the
attorneys’ fees spent or paid by the parties during the course of the
arbitral proceedings.
Professor George Bermann has aptly identified these questions (and many
more) as “twilight issues” in arbitration. What they have in common is that
they are rarely addressed in the arbitration agreement and the arbitral rules
adopted by the parties. If addressed at all, “these procedural or quasi-procedural
questions are left, for the most part, to the ‘good judgment and discretion’ of
the arbitral tribunal.” Although the parties may be content relying on the
“good judgment” of the arbitral tribunal (in whose constitution they have
participated), they may also reasonably expect that the arbitrators will apply
standards which are somewhat predictable and consistent with the international
nature of the dispute, rather than leaving the question up to national laws or
to the discretion of the arbitral tribunal.
II. SEARCHING FOR ELUSIVE “GENERAL PRINCIPLES” UNDERLYING

INTERNATIONAL COMMERCIAL TRANSACTIONS
The quest for international standards governing international contracts

has been strongly felt in recurring and important areas of substantive law. So
CONSENSUAL JUSTICE: CHALLENGES AND PROMISES 5
much so that international adjudicators are frequently admonished to avoid

the application of domestic laws by filling its gaps resorting to the so-called
“lex mercatoria,” an amorphous amalgam of international trade usages, best
practices and general principles of law (as indeterminate as a such body of law
may be). In a field of substantive law maturely codified as the international sale
of goods), the quest for an international and uniform response raises complex
issues of interpretation and gap-filling. The primary interpretative canon is
articulated in terms of an “autonomous” understanding of the CISG, meaning
the need to approach the is the terms of the treaty independently of its
understanding within the conceptual legal framework of national law and in
accordance with the “origin and purpose” of the treaty. This mandate is
reflected in a most relevant provision, Article 7 (1) CISG, calling for taking into
consideration its “international” character or nature, coupled with the exhortation
to “promote uniformity in its application,” as well as “the observance of good
faith” in international trade.
This interpretative canon is followed by a not less relevant gap-filling
formula, distinguishing between questions falling under but not expressly
settled by the CISG—to be decided in conformity to the “general principles”
underlying the treaty—as opposed to those questions which—not being
covered by the CISG—must be inevitably governed by the “otherwise applicable
domestic law”, as determined by the rules of private international law. Article
7(2) CISG has been transposed to other international treaties elaborated not
only under the auspices of UNCITRAL but also by other international law-
formulating agencies. The idea of approaching these international instruments
by taking into account the needs and practices of international commerce,
regardless and beyond conceptual distinctions of domestic law, is aimed at
mitigating potential divergences among national legal systems, identifying
prevailing trends across national borders in order to arrive at a genuinely
“autonomous” interpretation. This same need has been felt in international
arbitration.
III. GAP-FILLING IN INTERNATIONAL ARBITRATION
Whereas searching for international standards to fill gaps in the substantive

law proved to be a complex task, those difficulties pale in comparison with the
challenges posed by the search for international consensus on the many
procedural and quasi-procedural issues arising in the course of an international
arbitration. Admittedly, instruments such as the “United Nations Convention
on the Recognition and Enforcement of Foreign Arbitral Awards” (the New
York Convention or NYC), the UNCITRAL Model Law on International Commercial
Arbitration (UML) and the UNCITRAL Arbitration Rules (UAR) represent
successful unification efforts. Yet, despite the crucial and comprehensive coverage
of both instruments, they fail to address many procedural issues which are
ultimately left to the discretion of the arbitral tribunal.
Questions which the parties failed to address in the arbitration agreement,

not provided for in the arbitration law and the arbitral rules adopted by the
parties are not addressed by the New York Convention or the otherwise
applicable “lex arbitri.” A variety of sources compete to fill these gaps, including
the law applicable to the cause of action (lex causae), the law of the seat, and
the law of the jurisdiction where the award by be eventually enforced. A
variety of guidelines, notes, and rules adopted by major arbitral institutions
and professional associations may also claim plausible application.
In an effort to fill this “lacunae” Article 2A of the UML, as adopted in 2006,
introduced interpretive criteria and a gap-filling formula along the lines of
Article 7 CISG, which reads thus:
(1) In the interpretation of this Law, regard is to be had to its

international origin and to the need to promote uniformity in its
application and the observance of good faith.
(2) Questions concerning matters governed by this Law which are not
expressly settled in it are to be settled in conformity with the
general principles on which this Law is based.
This provision intends to provide an analytical framework of analysis on

which an arbitral tribunal may rely in order to address questions “unprovided-
for” by the “lex arbitri.” However, it is far from clear where and how the
“general principles” of the “lex arbitri” are to be found. Do these principles
implicate looking for common patterns across national jurisdictions or should
the discovery of such principles implicate something more than a practical
exercise in comparative law? Unlike Article 7 (2) CISG, Article 2A (2) UML, not
being concerned with the applicable law to the merits of the dispute, refuses
to fall back on the domestic law determined by the rules of private international
law. Some arbitration statutes, adopted relatively recently, have attempted to
improve on this formula, pointing to additional non-domestic sources of
arbitration law aimed at filling the gap. For example, the arbitration law
adopted by Mauritius in 2008 (Art. 2B (c) refers the arbitral tribunal to
“international materials” (including the case law of foreign jurisdictions whose
law is also based on the UML, as well as the academic and professional
writings). The Peruvian arbitration law (Art. 34 (3)), also adopted in 2008,
goes even further, giving the arbitral tribunal the power to resort to arbitration
“principles” as well as arbitration “customs and usages.”
Which are the sources that the arbitral tribunal may resort to in order to
find “general principles” governing international arbitration? Where can or
should arbitrators look for international standards? Those sources are of a
different nature, some are binding whereas other sources are merely
persuasive. But all such sources are relevant for the purpose of searching and
finding the “general principles” governing international commercial arbitration.
IV. PLURALITY OF SOURCES UNDERLYING THE “GENERAL PRINCIPLES”

OF INTERNATIONAL ARBITRATION
Some arbitration rules and principles, codified as “good practices” or some

other form of “soft law,” enjoy wide consensus in the so-called “arbitration
community.” But Professor Bermann’s research demonstrates that some
“twilight issues” are more amenable to be settled by some sources rather than
others: Not surprisingly, some questions remain so controversial that, not yet
ripe to be addressed by international standards, such questions are better left
to the domestic law that the arbitral tribunal finds “most appropriate.” What
follows is a non-exhaustive enumeration of some of the sources which the
arbitral tribunal may consult in order to find some of the “general principles.”
Public International Law. If the arbitration is truly international, one may
consult, first and foremost, classical sources of public international law, listed
in Article 38 of the Statute of the International Court of Justice. Among the
“primary” sources of international law, one may refer to international agreements
(treaties or conventions), as well as recurring patterns of state behavior followed
with the conviction that they are binding (customary international law). Also,
some “general principles of law” may be discerned in governing relations among
sovereign states inter se as well as in the settlement of disputes between foreign
investors and host states. Yet, such general principles, while providing a level
of convergence on public international law at an abstract level, are unlikely to
provide much assistance to an arbitral tribunal searching for international
standards applicable to discrete and specific issues (e.g., determining the rate
of interest to be paid, the scope of testimonial privilege or, say, the scope of
responsibilities to be discharged by the secretary an arbitral tribunal).
Soft Law. The adoption of an ever-increasing number of “soft laws” holds
a greater promise to find international standards addressing the type of
procedural and quasi-procedural issues often confronted by arbitral tribunals.
Among the set of soft laws purporting to exert persuasive, though not binding,
influence on international arbitration proceedings one may include ethical
cannons governing the conduct of arbitrators, potential scenarios of conflicts
of interests aimed at assisting the challenge of arbitrators, factors to consider
when deciding whether to grant interim or provisional relief. Whether and
how guidelines of “soft law” may evolve from embryonic standards to widely
used and highly persuasive rules may depend on various factors, including the
prestige of the members of the task force behind the drafting of such guidelines;
the working group or subcommittee of the international organization, arbitral
institution, or professional association who took up the job of drafting such
rules, etc. Ultimately, it is the level of reception or acceptance of those guidelines
that determines whether such soft law eventually becomes a reliable international
source of international arbitration. The “IBA Rules on the Taking of Evidence
(1999/2010/2021)” (IBA Evidence Rules) the “IBA Guidelines on Conflicts of
Interest (2004/2014)” (IBA Conflicts of Interest Guidelines) may exemplify the
type of rules which, given the readiness to be adapted over time, proved
malleable and user-friendly enough to bridge gaps among different legal
cultures and legal systems. Other guidelines, despite the prestige of its drafters
and the sponsoring institution, face more difficulties to become operational in
arbitral practice (this is the case, for example, of the ILA Report on the Use of
Public Policy (2009) as a ground to annul and refuse to enforce arbitral awards.
Arbitration Rules. Rules adopted by major arbitral institutions may
become an additional source of international standards governing discrete
albeit significant issues arising in the course of international arbitration.
Arbitration rules are obviously binding on those who adopt them, but when
several major arbitral institutions adopt similar provisions responding to
perceived needs in the actual administration of arbitration proceedings, such
rules may become, for all practical purposes, a “soft law” standard apt to
become a reliable source to solve recurring “twilight issues.” Recent reforms
of arbitration rules have been instrumental in filling the vacuum left in national
arbitration laws on the appointment of an “emergency arbitrator”, the joinder
of parties, third-party funding, and early dismissal of unmeritorious claims.
Arbitration rules aimed at enhancing transparency in investor-State arbitration,
for example, were so well-received that soon after adopted they took shape of
an international treaty (2014 UNCITRAL Rules on Transparency, also referred
to as the “Mauritius Convention”). More recently, arbitral institutions converged
on adopting guidelines on the appointment of secretaries to arbitral tribunals.
Most of those rules confine their tasks to administrative and organizational
matters, so as to prevent the arbitrator’s delegation of decision-making
functions, and they have found widespread acceptance by arbitral institutions.
Noticeably, however, arbitration rules don’t always coincide in their proposed
solutions to those “twilight issues”. This is the case, for example, of the few
arbitration rules addressing the award of interest. Whereas one arbitral
institution recommends taking into account the substantive law governing the
contract (Art. 31(4) ICDR Rules), another favors granting more discretion to
the arbitral tribunal, which should not necessarily follow the practice of state
courts (Art. 26 LCIA Rules).
Arbitral Case-law. Despite obvious concerns for confidentiality, some
arbitral institutions have been moving towards greater transparency,
encouraging increased publicity of arbitral awards. To the extent that cautious
reliance on arbitral precedents may instill consistency and efficiency in arbitral
practice, arbitral case-law may become, to the extent it becomes known and
discussed, an additional source of international standards in international
arbitration. Irrespective of the common-law or civil-law tradition, the
influence of case-law has been felt in the jurisprudence of international and
supranational courts, and its use has been encouraged in order to provide
more consistency to awards interpreting broad and vague standards of
investment protection.
Academic and practitioners’ comments. The list of potential international

sources aimed at filling gaps in international arbitration must also take into
account the commentaries of academics and practitioners whose views are
expressed not only in specialized publications, but also at an increasing
number of conferences held by arbitration “clubs,” “annual meetings” convoked
by prestigious arbitral institutions, “arbitration days” organized by law schools,
etc. In fact, hardly a week or even day goes by without a publication by blogs
sponsored by prominent law firms specializing in international arbitration.
None of these publications purport to set out authoritative international
standards. Yet, to the extent they criticize and synthesize different points of
view, comments by academics and experienced practitioners inevitably
contribute to identify trends on international commercial arbitration.
All the sources cited so far claim a role to play in the “progressive
codification” of some “general principles” of international arbitration, reinforcing
each other in unpredictable ways. Their acceptance is likely to result from a
combination of hard and soft law, coupled with the contribution of professional
and scholarly commentaries, all of which gaining support for “good practices”
and international standards in international arbitration.
V. SOME “TWILIGHT ISSUES” CALLING FOR “INTERNATIONAL

STANDARDS”
As stated before, Professor Bermann’s research and study reveals that some
sources address some “twilight issues” better than other sources. Defenses such
as of “lis pendens” and “res judicata”, for example, may be listed among
“twilight issues” less amenable to international consensus, whereas scholarly
and professional comments may be relevant to suggest the way to go on
matters such as the allocation of costs (including attorneys’ fees) and the
application of “ius novit curia” (i.e., the power of arbitral tribunals to apply the
law they see fit, independently of the parties’ legal theories or arguments). The
failure to reach a consensus elucidating some “twilight issues” may suggest
merely that the issue in question may not be ripe for adoption of an international
standard. In some cases, however, such questions may be preferably left to
national law. As noted by Professor Bermann, equally important to finding
transnational guidelines is to refrain from pursuing a uniform response when
none is available or attainable (“some twilight issues …may be better served
by reliance on national law than on any soft law instrument that may be
imagined”). Reference to some of these issues suffice to illustrate the complexity
of finding a universal rule even in the field of international arbitration.
Arbitrability. Regardless of the law chosen by the parties, the determination
of whether certain types of disputes may be settled by arbitration is unlikely
to be decided “ex ante” on the basis other than the law of the forum before
which an arbitration agreement is sought to be enforced. Once the award has
been rendered, the arbitrability question will be decided “ex post” on the basis
of the law of the f the forum before which the losing party seeks to set the
award aside (Art. 34(2) UML) or the award-creditor seeks to enforce the arbitral
award (Art. V (2) (a) NYC).
Interim Relief. It is not always clear why some twilight issues are more
amenable to be settled by international standards. A case in point are the
standards to be relied upon for an arbitral tribunal to grant interim or provisional
relief. This issue is rarely addressed in the arbitration agreement or in major
arbitration rules (with the exception of the usual requirements of urgency and
the possibility of requiring security, e.g., Rule 23(1) HKIAC, Rule 24 ICDR Whereas
It had been clear for some time that it is within the province of the arbitral
tribunal to grant interim relief, it was not until the reforms adopted in 2006
that UNCITRAL decided to articulate in much detail in a new Article 17 which
are the relevant factors to be considered for granting such provisional
remedies. Other aspects of interim relief are yet to reach a wider consensus.
This is the case, for example, whether to allow the issuance of an “ex parte”
“preliminary order” (Arts. 17B and 17C UML), or whether an arbitral tribunal
or court may issue an “anti-suit” or “anti-arbitration” injunction and the
circumstances warranting such measures.
Evidence-taking. his is an area widely covered in the form of “soft law” or
guidelines adopted by various institutions (CPR, ICDR, ICC, IBA). Both the
“Prague Rules” and the “IBA Evidence Rules” provide useful guidelines aimed
at bridging the different approaches to discovery and the admissibility of
evidence. This is case, most notably, on submitting document requests and the
style and mode of examining fact witnesses and experts. But the taking of
evidence implicates a variety of questions, including who should bear the burden
of production and how is the burden of persuasion to be met. Article 3(3) of
the IBA Rules on Evidence seems to provide for a balanced compromise on the
requirements to be met for the production of documents at an early stage of
the proceedings. This aspect of the taking of evidence exemplifies how “soft
rules” may gradually turn, together with the widely used “Redfern Schedule,” a
veritable international standard on how to handle document requests.
Privileged Information. Consensus has been more elusive regarding
whether evidence should be admitted or excluded when a party alleges a
“privilege” exempting that party from giving testimony or furnishing documents
in order to protect confidential information, especially if such information was
obtained through settlement negotiations or while obtaining legal advice.
Among the variety of legal and ethical rules exempting a party from furnishing
“privileged information,” the IBA Rules on Evidence stand out for seeking to
establish a level playing field. Thus, in addition to applying the domestic law
providing for the privilege to which a party may be arguably entitled, Article 9
of the IBA Rules on Evidence provides that the arbitral tribunal may also apply
“any other law it determines to be applicable”. This amalgam drawn from the
applicable national law and “any other law” provides an international standard
for determining when information may be considered “privileged.”
Ius Novit Curia. Regarding the power of the arbitral tribunal to find and
apply the law independently and beyond the arguments advanced by the
parties, (a practice widely known in the civil-law world as “ius novit curia” (the
tribunal knows the law), presents another question on which differing views
call for a more predictable and universal approach. Some civil law jurisdictions
grant the courts not only the power but also the duty to identify the relevant
issues, ascertain the relevant facts and apply the law independently of the
parties’ legal arguments. Other legal systems, definitely those sharing a common
law tradition, prefer to leave that job exclusively to the parties. A few arbitration
rules attempt to address this issue (Art. 2.1 (c) LCIA; Art. 12 (3) SAR). The ILA
also took a position on this question in a report published in 2010 (ILA Report
on Ascertaining the Content of the Applicable Law in International Commercial
Arbitration). The prevailing approach authorizes an arbitral tribunal to find for
itself the relevant rules of law, but such power may be exercised “only after
giving the parties a reasonable opportunity to state their views”.
Corruption. Corruption is another question recurring in international
arbitration, especially in the field of investor-State arbitration, where it has
been frequently raised as a substantive defense opposing a claim brought by a
foreign investor. Because corruption is outlawed in most legal systems, a
contract tainted by corruption may be held illegal pursuant to classic “general
principles of law” embraced by most “civilized legal systems” (Art. 38 (1) (c))
I.C.J.). Thus, evidence that an investment was obtained by corruption may
suffice for an arbitral tribunal to refuse taking jurisdiction and dismiss a claim
(World Duty Free v. Kenya (2006)). Yet, many questions remain largely undefined,
such as the extent to which the burden of persuasion regarding acts of
corruption rests on the party who alleges corruption and, perhaps more
importantly, which are the substantive elements that must be established in
order to prove the existence of corruption.
More than one national law may claim application in defining corruption
and establishing the elements that must be proven, including the usual pair of
domestic legal systems that come into play in most international arbitrations
(that is, the law of the seat of arbitration (which may suffice to set the award
aside) and the where the award may be sought to be enforced (which may
suffice to refuse the enforcement of the award). However, t if the question does
not concern the role of corruption in the conclusion of the contract, but rather
its performance, then the lex contractus—whether chosen by the parties or
determined by the arbitral tribunal—may also have a role to play. On the
circumstances according to which the bribe-giver may enforce the contract
and the weight of the evidence to be produced, the law of the forum as well as
the law of the place where the bribes were solicited or given may also plausibly
claim application.
If corruption is genuinely regarded a matter of “international public policy,”
as suggested by many, it seems imperative to apply international standards for
establishing whether corruption has taken place. More than one international
treaty defines what should be understood by corruption in very specific terms

(see, e.g., Art. 61 of the UN Convention Against Corruption (2003); Art. 1 of the
OECD Anti-Bribery Convention (1997), not to speak of the regional conventions
on the same subject such as the OAS Convention Against Corruption of 1997
and a similar treaty adopted by the Council of Europe in 1999). However, truly
international standards are yet to emerge on these questions.
Whether a foreign investment should be disqualified from protection due
to corruption calls for the application of international law and the law of the
host State. This seems to be the case under Art. 42 (1) of the ICSID Convention,
although some bilateral and multilateral treaties allocate a more modest role
to the domestic law of the host State (e.g., Art. 30 of the 2012 U.S. Model BIT,
which fails to mention the law of the host State; see also Art. 8.31 of the Canada-
EU FTA, limiting the law of the home State to factual issue for the purpose of
measuring the legality of the measures taking by the host State). Because
corruption is so much entangled with issues of public policy, an arbitral tribunal
confronted with the task of determining whether a contract tainted by corruption
should be enforced will probably resort, once again, to an amalgam of national and
international law. The emergence of a genuine international standard governing
the elements to establish corruption and the burden of persuasion to prove it
must probably await the development of more refined arbitral jurisprudence,
especially on the issue of remedies and the role played by restitution. It has
been held that the giving of a bribe disqualifies a foreign investment from
protection under the applicable BIT as long as the bribe was covert and even if
the bribe was extracted at the insistence of a public international standard, the
weight of the evidence to be gathered may have to be developed also in light of
some international standard. In 2019, the Basel Institute on Governance
published a “toolkit for arbitrators,” pointing to several “red flags” indicative
of corruption. Although the toolkit suggests the need for consulting national
law, it also suggests that an arbitral tribunal should choose, independently of
national law, among different evidentiary standards (“clear and convincing,”
“preponderance,” and “inner conviction”). Given that direct evidence of
corruption is so hard to come by the Basel toolkit does not discard the need to
rely on circumstantial evidence.
Res judicata. All legal systems recognize some type of res judicata doctrine
aimed at avoiding duplicative, contradictory and vexatious litigation. In principle,
res judicata is aimed at preventing a party from attempting to re-litigate an
action between the same parties, concerning the same subject matter and the
same claim. Yet, “res judicata” (literally, “thing adjudged”) is not a universal
concept, and not all legal systems speak with the same voice as to how and
when such “identities” (parties, claims, subject matter/object, relief sought, etc.)
between the earlier and later cause of action have been. There is no universal
rule either as to whether the prior adjudication, in order to bear preclusive effects
on a subsequent one, must emanate from an arbitral or a judicial authority.
Given such discrepancies and the absence of clear international standards, the
determination of the applicable law to “res judicata” becomes relevant,

especially to the party who prevailed in a previous claim.
The contours of res judicata may be defined by the law of the forum from
which the previous judgment or award was rendered, claiming a strong interest
in that such decision be respected. However, the “lex causae” governing the claim
previously adjudicated, or the law applicable at the seat of the arbitration may
also plausibly claim application. In 2007, the ILA sought to provide uniform
guidelines for arbitral tribunals to follow (ILA Report and Recommendations on
Res Judicata and Arbitration, published in 24 Int. Arb. 415 (2007) or “ILA Report
on Res Judicata”). Yet, given the variety of approaches to the question of when
a party may be bound by obligations assumed by another, the ILA Report on
Res Judicata declined to take a uniform standard for determining when the
requirement of “identity of parties” had been met, leaving this question to the
domestic law determined by the rules of private international law.
In order to avoid “claim splitting”, the ILA Report on Res Judicata adopts
the broad concept of claim preclusion prevailing in common law jurisdictions.
According to this notion (also supported by doctrines known as “bar and merger”
and “total res judicata”), “the preclusive effects of the earlier adjudication are
triggered if the later action arises out of the same facts as the earlier one, and
the claim could have reasonably been brought in that proceeding” (Restatement
Second of Judgments, Section 24 (2)). Civil-law jurisdictions tend to take a
narrower approach towards the concept of “res judicata,” giving the prior
action preclusive effects only if the “tripartite identity” requirements have
been strictly met. While acknowledging the merits of the flexible approach to
the doctrine of collateral estoppel taken by the common law, the ILA Report on
Res Judicata refrains from taking a veritable “uniform” standard, noting that it
was premature to adopt “a transnational principle in international arbitration.”
Accordingly, the ILA Report on Res Judicata indicates that an arbitral tribunal
may legitimately find that the principle of “res judicata” may apply even in
those cases in which all identities are not strictly met if not doing so would
result in “procedural unfairness or abuse.”
Lis pendens. As plausible as it seems to adopt some kind of “lis pendens”
rule to avoid duplicative and conflicting awards, there are no standards of
universal application on this question. Whereas common law jurisdictions are
inclined to provide the second tribunal with ample discretion to decide
whether to stay an action when the same claim has been previously brought in
another jurisdiction, most civil law jurisdictions are in favor of adopting the
more rigid but predictable “first-in-time” rule. Eventually, with the passage of
time, a middle-of-the-road approach may eventually emerge, allowing the second
arbitral proceeding to continue only when established that the previous
parallel proceeding fails to respect basic due process standards.
Costs. The voice of practitioners and arbitrators have been heard on an
issue as close to the legal profession as the allocation of costs in international
arbitration, especially on the allocation of legal fees or “attorney fees” (the
lion’s share of the costs of arbitration). The main criteria in different legal
traditions have gravitated between the rule that the losing party should pay all
of the winning party´s cots (costs follow the event), as opposed to what is widely
known as the American rule, according to which, unless provided otherwise by
law or agreement of the parties, each party bears its own costs.
In what appears as a veritable trend in international commercial arbitration
practice, the starting point on how to allocate costs rests on the parties´
respective degree of success, taking into account the outcome of their claims
and defenses. This point has been made clear in several arbitration rules.
However, beyond the text of those rules, many practitioners advocate flexibility,
calling for the arbitral tribunal to always take into account “the circumstances
of the case.” In practice, this means that the loser may have to show he had a
meritorious claim or defense or at least that such claim or defense, rather than
a frivolous assertion, had a plausible chance of success. Guidelines issued by
well-known organizations have followed suit, recommending arbitral tribunals to
go beyond the relative success of the claims. soft law recently adopted also rely
on cost allocation as a proper means to sanction a party’s misconduct, taking
into account offers exchanged between the parties aimed at settling the
dispute and other factors the tribunal may consider relevant (see “IBA
Guidelines on Party Representation” and the “Draft on Arbitral Awards on Costs”
issued by the Chartered Institute of Arbitrators).
VI. CONCLUSION
International arbitration provides a model of consensual administration of

justice which, at least for settling international business disputes, has proven
successful enough as to be considered the main, as opposed as a mere
“alternative,” method of dispute resolution. However, in order to preserve its
competitive edge over other models of consensual justice, international
arbitration needs to develop genuine transnational standards addressing the
many procedural and quasi-procedural questions.
In the course of the many years of Professor Bermann’s teaching, research,
and practice, he has identified many of these “twilight issues,” providing
helpful points of reference for arbitral tribunals to reach a decision on genuine
“international” grounds.
Chapter 2
HOW WOULD A FUTURE WTO AGREEMENT ON
INVESTMENT FACILITATION FOR DEVELOPMENT
ENCOURAGE SUSTAINABLE FDI FLOWS, AND
HOW COULD IT BE FURTHER STRENGTHENED?
Karl P. Sauvant*
I. THE IDEA AND CONTOURS OF THE AGREEMENT
In 2015, a multi-stakeholder E15 Task Force on Investment Policy1 proposed

that a “Sustainable Investment Facilitation Understanding” be negotiated. It was
meant to be an instrument “entirely technical in nature, focusing on practical
actions to encourage sustainable investment flows to developing countries”.2
The proposal was supported by the members of the Task Force, which included
the heads of the investment work at the OECD, UNCTAD, the World Bank
Group, and the WTO Secretariat.3 As part of the follow-up, the E15 report4 was
presented in the WTO Secretariat and to the OECD Investment Committee.5
* Karl P. Sauvant is a Senior Fellow of Columbia Center on Sustainable Investment at
Columbia University. He currently assists the International Trade Centre (ITC) and the German
Development Institute (DIE) on a project on Investment Facilitation for Development. He is
grateful to Rudolf Adlung, Axel Berger, Melaku Desta, Mathias Francke, Yardenne Kagan, Joachim
Karl, Peter Muchlinski, Joel Richards, Sheri Rosenow, Lou Wells, and Quan Zhao for their helpful
feedback on an earlier version of this manuscript, and Naina Yadav for research assistance. This
manuscript was completed in June 2022.
1 The International Centre for Trade and Sustainable Development and the World Economic
Forum established the E15 Initiative in 2012 to convene experts and institutions to generate policy
options for the evolution of the global trade and investment system. George Bermann was a
member of that Task Force; he also co-authored a brief article on a critical issue in the
negotiations: “Insulating a WTO Investment Facilitation Framework from ISDS”, Columbia FDI
Perspective, no. 286 (September 7, 2020), last accessed on March 4, 2022.
2 See, Karl P. Sauvant, “We need an international support programme for sustainable
investment facilitation,” Columbia FDI Perspectives, no. 151 (July 6, 2015), pp. 3, 2, last accessed
February 27, 2022. I made this proposal while being the Theme Leader of that Task Force. For an
account of the genesis of the proposal, its driving interests and the discussions at the WTO, with
particular attention to the development dimension, see Evan Gabor, “Keeping ‘development’ in
a Multilateral Framework on Investment Facilitation for Development”, Journal of World
Investment &Trade, vol. 22 (2021), pp. 41–91, last accessed on March 4, 2022.
3 Respectively, Ana Novik, James Zhan, Anabel González, and Abdel-Hamid Mamdouh.
4 Karl P. Sauvant, on behalf of the E15 Task Force on Investment Policy, “The evolving
international investment law and policy regime: ways forward” (Geneva: International Centre for
Trade and Sustainable Development and World Economic Forum, E15 Task Force on Investment
Policy Initiative, 2016), last accessed on March 4, 2022.
5 Respectively, February 9, 2016 in the WTO, and October 20, 2016 in the OECD Investment
Committee. For a discussion of further follow-up, see Evan, op. cit.

15
The idea was that such an agreement would help meet future investment
needs (especially in developing countries) by facilitating not only the flow of
foreign direct investment (FDI) in general, but especially the flow of sustainable
FDI, through actions taken by host countries, home countries and multinational
enterprises (MNEs). In a world of global value chains, an investment facilitation
agreement would complement the WTO Trade Facilitation Agreement; it
would provide a benchmark for good practices for countries to follow and a
reference point and commitment device for domestic FDI-competent institutions
seeking to reform their FDI regulatory framework; and it would contain
international technical assistance and capacity building commitments to help
developing countries implement such reforms.6
The idea of facilitating FDI flows in general has certainly gained traction.7
The activity as such is not new: it has always been a bread-and-butter task of
investment promotion agencies (IPAs), namely to attract FDI and facilitate the
investments and operations of MNEs (it is difficult to draw the boundary line
between “attracting” and “facilitating” FDI).8 What was new was that the
proposal focused attention on investment facilitation and, specifically, suggested
that these activities should be supported by an international agreement on
investment facilitation, an agreement that would focus on specific technical
measures aimed at facilitating FDI flows and, especially, sustainable FDI flows
(thereby going beyond the investor-protection focus of international investment
agreements).
In fact, the UNCTAD Secretariat immediately embraced the idea and prepared
a “Global Action Menu for Investment Facilitation” in 2016, and members of
the OECD Secretariat published an article on that subject.9 The topic of investment
facilitation is now also being addressed in bilateral investment agreements
(with Brazil having begun to incorporate investment facilitation references in
6 See, Karl P. Sauvant, “The potential value-added of a Multilateral Framework on

Investment Facilitation for Development”, Transnational Dispute Management, June 2019, last
accessed on March 4, 2022. For a more skeptical view, see, N. Jansen Calamita, “Multilateralizing
investment facilitation at the WTO: Looking for the added value“, Journal of International
Economic Law, vol. 23 (2020), pp. 973–988, last accessed on March 4, 2022.
7 It should be noted that, once the regulatory framework is enabling, economic factors constitute
the principal FDI determinants; see, UNCTAD, World Investment Report 1998: Trends and
Determinants (Geneva: UNCTAD, 1998), ch. IV, last accessed on March 4, 2022.
8 For an inventory of investment facilitation measures, including examples of countries that
have adopted some of them, see, Karl P. Sauvant, Matthew Stephenson, and Yardenne Kagan, “An
inventory of concrete measures to facilitate the flow of sustainable FDI: What? Why? How?”
(Geneva and Bonn: International Trade Centre and German Development Institute, June 2022),
third edition, last accessed June 15, 2022 (henceforth Inventory). For a comprehensive analysis
of the extent to which investment facilitation measures have been implemented, see, Axel Berger,
Ali Dadkhah and Zoryana Olekseyuk, “Quantifying investment facilitation at country level:
introducing a new index” (Bonn: DIE, 2021), last accessed on March 3, 2022. For a recent review
of investment facilitation measures, see UNCTAD, “Investment facilitation: progress on the
ground”, Investment Policy Monitor, January 27, 2022, last accessed on March 4, 2022.
9 See Ana Novik and Alexandre de Crombrugghe, “Towards an international framework for
investment facilitation” (Paris: OECD, April 2018), last accessed on March 3, 2022.
HOW WOULD A FUTURE WTO AGREEMENT ENCOURAGE SUSTAINABLE FLOWS 17
its Investment Cooperation and Facilitation Treaties already in 201510) and in

international trade and investment agreements (e.g., the Regional Comprehensive
Economic Partnership Agreement11). Negotiations on a separate treaty on an
investment facilitation agreement have begun in 2021 between the European
Commission and Angola,12 and similar treaties may well be negotiated between
the Commission and other countries.
Most importantly, a number of WTO Members (the “Friends of Investment
Facilitation for Development”13) launched, in April 2017, an informal discussion
process on the subject in the WTO, open to all Members. Then, in December
2017, 70 Ministers at the WTO’s Ministerial Conference in Buenos Aires called,
in a Joint Ministerial Statement, “for beginning structured discussions with the
aim of developing a multilateral framework on investment facilitation. These
discussions shall seek to identify and develop the elements of a framework for
facilitating foreign direct investments…”.14 The mandate explicitly provided, in
strong language (“shall”), that “[t]hese discussions shall not address market
access, investment protection, and Investor-State Dispute Settlement”; it
furthermore provided that “facilitating greater developing and least-developed
Members’ participation in global investment flows should constitute a core
objective of the framework”.15 Both are directives that were repeated in
subsequent statements.
The structured discussions began in 2018 and became formal negotiations16
on a WTO Investment Facilitation for Development (IFD) Agreement in
September 2020.17 They cover18 scope and general principles; transparency of
10 See, https://investmentpolicy.unctad.org/international-investment-agreements/countries/
27/brazil, last accessed on April 4. 2022.
11 Art. 10.17, last accessed on March 4, 2022.
12 Council of the European Union, “COUNCIL DECISION authorising the opening of negotiations
with the Republic of Angola for an agreement on investment facilitation”, Doc. No. 8441/21,
May 20, 2021, last accessed on March 4, 2022.
13 As of March 2022, its members were: Brazil; Chile; China; Colombia; Guatemala; Hong
Kong (China); Kazakhstan; Liberia; Mauritania; Mexico; Nigeria; Pakistan; Qatar; Republic of Korea;
The Gambia, Turkey, and Uruguay. The Group is coordinated by China.
14 WTO, “Joint Ministerial Statement on Investment Facilitation for Development”,
WT/MIN(17)/59, Dec. 13, 2017, para. 4, last accessed on March 4, 2022. Other Joint Statement
Initiatives were launched in Buenos Aires as well; the plurilateral negotiations on investment
facilitation are the most inclusive of them in terms of participation by developing countries. See
the Annex of https://www.t20italy.org/wp-content/uploads/2021/09/TF3_PB01_LM04.pdf.
15 WTO, “Joint Ministerial Statement on Investment Facilitation for Development”, WT/MIN
(17)/59, Dec. 13, 2017, paras. 4 & 6, last accessed on March 4, 2022.
16 As called for by 98 WTO Members in the “Joint Ministerial Statement on Investment
Facilitation for Development”, WT/L/1072/Rev.1, November 22, 2019, last accessed on March 4,
2022.
17 The formal decision to move into negotiations mode had been taken in December 2019,
with negotiations meant to begin in March 2020. However, because of the COVID-19 pandemic,
negotiations began only in September 2020.
18 The negotiations text is a restricted document, accessible only to WTO Members. An unofficial
version of the February 9, 2022, Easter Text: is available at https://web.wtocenter.org.tw/

investment measures; streamlining and speeding up administrative procedures;

focal points, domestic regulatory coherence and cross-border cooperation; special
and differential treatment for developing and least-developed country Members;
sustainable investment; and institutional arrangements and final provisions.
The negotiations involved, as of April 2022, 113 WTO Members (i.e., not
the entire membership of the WTO), but they are open to all Members. They
are therefore not formal multilateral negotiations (like those, e.g., of the WTO
Trade Facilitation Agreement), but rather negotiations carried out by a subset
of the membership in the framework of Joint Initiatives.19 The negotiations—
guided between September 2020 and June 2022 by Ambassador Mathias
Francke of Chile20 and since then by Ambassador Sofia Boza of Chile and
Ambassador Jung Sung Park of the Republic of Korea—have moved forward
quite rapidly and continue to do so. They were meant to be concluded by the
end of 2022.21
How would a future IFD Agreement (containing, as it does, both mandatory
and “best endeavor” provisions), as it is shaping up in the negotiations, be
expected to encourage sustainable FDI flows as originally suggested? Do these
negotiations sufficiently integrate the sustainable development dimension?
And, how could the Agreement be further strengthened in this respect? Since
the negotiations are still ongoing, it is not possible to provide definitive
answers to these questions: nothing is agreed until everything is agreed.
However, since substantial parts of the operational measures—the core of the
Agreement—seem to be stabilized, a preliminary assessment can be made,
focusing on investment facilitation measures that directly increase the
development impact of FDI. In so doing, furthermore, concrete suggestions are
being proposed on how the development dimension of the Agreement can be
further strengthened.
DownFile.aspx?pid=367074&fileNo=0, last accessed on March 4, 2022. For a detailed description of

the content of the Agreement, see, Sofia Baliño and Nathalie Bernasconi-Osterwalder, “Investment
facilitation talks among WTO members transition to negotiations, adapt to shifting ministerial
timeline”, in Lisa E. Sachs, Lise J. Johnson and Jesse Coleman, eds., Yearbook on International
Investment Law and Policy 2020 (New York: OUP, 2022), ch. 6, last accessed on March 4, 2022.
19 This creates a challenge for how the Agreement, once negotiations are completed, will be
integrated into the WTO’s rule book. For a discussion of options, see Hamid Mamdouh, “Legal
options for integrating a new Investment Facilitation Agreement into the WTO structure”, last
accessed on March 4, 2022.
20 Before Ambassador Francke, the structured discussions were chaired by Ambassador
Eduardo Gálvez (Chile), Ambassador Juan Carlos Gonzalez Vergara (Colombia) and Ambassador
Marcelo Cima (Argentina). The negotiations are supported by a team in the WTO’s Trade in
Services and Investment Division.
21 See, WTO, “Joint Statement on Investment Facilitation for Development”, WT/L/1130,
December 10, 2021, last accessed on March 3, 2022. ITC and DIE are undertaking a number of
activities aimed at building capacity among developing country negotiators to participate
actively in these negotiations, to help ensure that their interests are taken into account; see here,
as well as Axel Berger, Yardenne Kagan and Karl P. Sauvant, eds., Investment Facilitation for
Development: A Toolkit for Policymakers (Geneva: ITC, 2021), second edition, last accessed on
May 23, 2022.
II. SUSTAINABLE FDI FOR SUSTAINABLE DEVELOPMENT
The starting point for answering these questions are the Sustainable
Development Goals (SDGs), and the first SDG—not coincidentally—concerns
ending poverty. Ending poverty requires economic growth, and economic
growth requires investment. While investment is of course not everything to
advance economic development, everything is nothing without investment.
Investment includes FDI—and, on balance, virtually all FDI contributes to a
country’s development if it does no discernible harm. Not surprisingly,
therefore, all countries—especially developing countries—seek to attract FDI.
It follows that actions facilitating the flow of FDI are helpful for governments
wishing to end poverty. Developing countries—which, after all, are most
interested in ending poverty—drive therefore the negotiations of an IFD
Agreement, together with developed countries.
Accordingly, WTO Members explicitly recognize in the Preamble of the
draft IFD Agreement the importance of investment for promoting sustainable
development and for achieving the SDGs. Importantly, in the body of the
Agreement itself, the purpose of the Agreement is stipulated as fostering
sustainable development. While the WTO’s founding document, the Marrakesh
Agreement, makes reference to sustainable development in the Preamble, the
only agreement adopted so far in the framework of the Organization—the
Trade Facilitation Agreement (TFA)—does not make reference to sustainable
development. The draft IFD Agreement explicitly recognizes the importance of
sustainable development, and not only in the Preamble, but in the body of the
Agreement.
Moreover, the draft IFD Agreement has, as one of its seven Sections, a
separate Section dealing with facilitating “Sustainable Investment”. (For greater
certainty, it should be made clear that, when “investment” is being used in the
Agreement, it means “foreign direct investment”, i.e., it does not include portfolio22
investment from abroad (or domestic investment23), in line with the mandate
given by Ministers in 2017 and repeated since then.24) This is only one of the
few times that, so far, the concept of “sustainable investment” has been
22 So far, “investment” is not defined. If it were to be defined, the development dimension
of the Agreement may have implications for the definition of “investment” and what investments
are included, e.g., by using the four Salini criteria as a reference point (https://iaa-
network.com/wp-content/uploads/2018/09/The-Salini-Test.pdf). If portfolio investment were
to be included and especially debt (which could involve questions about sovereign default),
consultations with the IMF might be required about the appropriate language, as a commitment
to the facilitation of investment flows in general may raise issues relating to balance-of-
payments crises; the OECD may have to be consulted as well, because of that Organisation’s
Liberalisation Codes.
23 But it could be mentioned that many of the measures identified in the Agreement also
facilitate domestic investment.

24 Referenced earlier.
recognized and accepted in an international investment agreement.25 It is a

major step forward and reflects the recognition that some FDI contributes
more to sustainable development than other FDI.
Of course, this raises the challenge of how to define “sustainable FDI”. A
first approximation could be to focus on certain “SDG sectors”, i.e., sectors that
are singled out in the SDGs, such as infrastructure or renewable energy. While
FDI in those sectors should in principle contribute to sustainable development,
a sector-centered approach may be too simplistic. For example, the automobile
sector may not be regarded as an SDG sector, but facilities producing electric
cars (vs. fuel cars) may well be regarded as SDG-friendly. Moreover, the SDGs
are multidimensional:26 individual projects in “SDG sectors” may advance one
SDG but negatively affect another. For example, building roads and installing
wind farms may raise environmental concerns, may not involve decent jobs or
could be done under unsafe working conditions—all SDG indicators that are
important in their own right.27
Accordingly, when speaking about “sustainable FDI”, one ought to take a
project-centered approach, regardless of the industry involved, and evaluate a
project’s SDG contribution, also taking into account trade-offs. This is done, for
example, in the OECD’s work28 on the quality of FDI and the approach
identifying “sustainable FDI characteristics”.29 The definition used here is: FDI
projects are “sustainable” if—while remaining commercially viable—they reflect
best efforts to make a reasonable contribution to the economic, social and
25 See also, the Preamble of the 2011 Estonia-Kazakhstan bilateral investment treaty
(“Recognizing that sustainable investment conditions will be most effective for maximizing the
use of livelihoods and living standards”) (https://edit.wti.org/app.php/document/show/
153d6fe5-cf29-4f69-b698-4bef76c2198f); the Preamble of the 2019 Brazil-Morocco bilateral
investment treaty (“Considering the importance of promoting sustainable investment and the
transfer of technology and know-how to achieve the goals of sustainable growth and development”),
https://edit.wti.org/app.php/document/show/cb06a3ac-7014-4312-a265-7d3ccd0f1074; and
Art. 41 of the 2021 European Union - Organisation of African, Caribbean and Pacific States
Partnership Agreement (2021) (“Mobilisation of Sustainable and Responsible Investment”)
(https://edit.wti.org/app.php/document/show/41423357-633d-4eba-afcb-18dba399b30f).
26 This approach is reflected, e.g., in the “Taxonomy” of the European Union, a classification
system that allows the identification of investment in economic activities that can be deemed
“environmentally sustainable” activities that make a substantial contribution to at least one of
the Union’s environmental objectives while not significantly harming any other such objectives
and meeting minimum social safeguards. See, “EU taxonomy for sustainable activities”,
https://ec.europa.eu/info/business-economy-euro/banking-and-finance/sustainable-
finance/eu-taxonomy-sustainable-activities_en#compass, last accessed March 30, 2022.
27 Given the carve-out of market access from the Agreement, Members may also be cautious
about a sector-centered approach which—by implication, or even in practice—might lead to

some sectors having effective market access through enhanced facilitation measures.
28 OECD, “FDI qualities indicators: measuring the sustainable development impacts of
investment“, last accessed on March 4, 2022.

29 Karl P. Sauvant and Howard Mann, “Making FDI more sustainable: towards an indicative
list of FDI sustainability characteristics”, Journal of World Investment & Trade, vol. 20 (Dec. 2019),
pp. 916-952, last accessed on March 4, 2022.
environmental development of host countries and take place in the context of

fair governance mechanisms.
III. HOST COUNTRIES: INDIRECT AND DIRECT MEASURES
How does the draft Agreement operationalize facilitating sustainable FDI

for sustainable development? This is done through the identification of concrete
measures that can be taken to facilitate FDI flows. And, to the extent that the
Agreement leads to the implementation of measures that facilitate higher
investment flows, it serves the purpose of advancing development.
The bulk of the measures mentioned in the draft Agreement consists of a
list of specific, concrete, actions that host countries should take in such areas
as the publication and availability of measures and information; no fees
imposed for access on information; and information on authorization procedures
and fees.30 These are all measures that indirectly contribute to host countries’
development: they are meant to increase FDI inflows that, in turn, contribute
to development.
More measures of this type could still be included in the Agreement (and
the inclusion of some were being considered at the beginning of 2022).
Examples include facilitating the entry and temporary stay of business persons
for investment purposes; business obstacle alert mechanisms; risk management
techniques; fast-track approval for reinvestments; and regular government-
investor roundtables to discuss issues relating to the operation of FDI projects.
Many more could be considered, and many have already been put in place
unilaterally by individual countries,31 but the draft Agreement includes the
most important measures of this kind.
But there are furthermore measures that not merely facilitate FDI flows in
general, but also directly contribute to host countries’ development. They do
this by strengthening the domestic enterprise sector in host countries or by
otherwise increasing benefits for host countries and thereby further
enhancing the development impact of FDI. A good example is the creation of
linkages between foreign affiliates and domestic firms. Foreign affiliates often
seek to source locally32 if they can obtain supplies at the cost, quality and
quantity required; often, in fact, the availability of local suppliers is a very
important consideration facilitating an investment decision. However,
frequently domestic firms, especially in developing countries, are not (quite)
ready to supply such inputs—they may need upgrading (e.g., in terms of
production standards). Accordingly, some countries have established supplier
30 For other specific measures in the draft Agreement, see, https://web.wtocenter.org.tw/
DownFile.aspx?pid=367074&fileNo=0, last accessed on March 7, 2022.

31 For an extensive list of such measures, including examples of countries that have
implemented them, see, Inventory, last accessed on June 15, 2022.

32 And this may become more important in the future, as firms become more concerned
about the fragility of their international supply chains.

development programs33 and data bases listing domestic suppliers, to make it

more attractive for international investors to establish production facilities. At
the same time, having upgraded—and more competitive—firms strengthens
the domestic enterprise sector, the bedrock of development. Investment
facilitation measures that directly contribute to sustainable development are of
particular interest to host countries.
Not many of these direct measures are in the draft IFD Agreement, but
there are a few on which it appears that consensus has been reached. Most
notably, the draft Agreement encourages host countries to build and maintain
databases of local suppliers to help investors identify potential domestic
suppliers,34 and it also provides that each Member shall ensure that measures
are taken to prevent and fight corruption with respect to matters falling within
the scope of the Agreement. Negotiators are furthermore considering measures
to encourage the establishment of supplier development programs to increase
the number and capacity of qualified local enterprises that can partner with
foreign affiliates—a measure very much supported by international investors.35
And, as will be discussed below, the draft Agreement promotes responsible
business conduct.
Again, more measures of this kind could be included in the Agreement,36
and to do so would increase the development impact of FDI (always assuming
they are implemented). Examples are:37 red carpet service for investments
having a significant positive sustainable development impact (rewarding in
this manner the investors undertaking these investments); the availability of a
responsible business conduct coordinator in IPAs to facilitate investor relations
with local communities and stakeholders; and the creation of a special category
of “Recognized Sustainable Investor” (RSI). The last of these examples, proposed
by one WTO Member, builds on the precedent established in the WTO’s TFA
(Art. 7.7), which created the special category of “Authorized Operator”. Its
principle is that, if firms satisfy certain criteria, they benefit from additional
33 For one example, see, and Kazakhstan, last accessed on March 4, 2022.
34 Inexplicably, this provision is not located in the “sustainable investment” section of the
Agreement, given that linking domestic firms to foreign affiliates and giving them an opportunity
to benefit from the tangible and intangible assets of these affiliates contributes directly to host
countries’ development.
35 In a survey of foreign investors in Latin America and the Caribbean, nearly 80% of
respondents considered the availability of supplier development programs to support local

suppliers to upgrade to meet standards of international investors as “important” or “very
important”. See, S. Reil et al., “What foreign investors want: findings from an investor survey of
investment facilitation measures in Latin America and the Caribbean“ (Geneva: ITC, 2022), last
36 For an extensive list of such measures, including examples of countries that have
implemented them, see, Inventory, last accessed on June 15, 2022.

37 International investors themselves overwhelmingly recognize the importance of some of
these direct investment facilitation measures, judging from their responses to a few of these in
the survey mentioned earlier; see, Reil et al., op. cit., last accessed on March 7, 2022.
trade facilitation measures; it is a provision that is widely implemented.38 A

Recognized Sustainable Investor provision would follow the same approach: it
would provide incentives to undertake sustainable FDI by offering additional
investment facilitation measures39 in exchange for the commitment by
investors to observe, and abide by, certain responsible business conduct
standards and their own corporate social responsibility statements, as well as
to make reasonable best efforts to ensure that the investments they undertake
fulfill certain sustainability characteristics.40 The more measures of this type
would be included in the Agreement, the more development-friendly it would be.
IV. HOME COUNTRIES: TRANSPARENCY
All these measures—whether they indirectly or directly increase FDI flows

and contribute to host countries’ development—are focused on what host
countries can do to facilitate investment flows. But (as suggested in the original
proposal of a Sustainable International Investment Facilitation Understanding),
the draft Agreement also addresses home countries and (as discussed below)
has obligations relevant to MNEs.
An increasing number of countries, including all developed countries and
more and more developing countries, have measures41 in place facilitating
outward FDI, typically provided by different institutions in home countries.42
38 According to the United Nations Digital and Sustainable Trade Facilitation: Global Report
2021 (New York: UN, 2021), https://unescap.org/sites/default/d8files/knowledge-products/

UNTF-Global%20Report-web%2B.pdf, p. 20, last accessed on March 11, 2022, nearly 50% of
Members on which information could be obtained had fully implemented this provision, over
20% had partially implemented it and over 10% were at the pilot stage of implementation. See
also the implementation commitments reported to the WTO as of early 2022 and available from
the Trade Facilitation Database, at https://tfadatabase.org/state-of-play.
39 One example was already given, namely red-carpet treatment for investors that make
extra efforts to increase the sustainable development contribution of their investments in host
countries. Other examples include assigning individual case officers to qualifying investors who
would assist them in all matters related to the establishment and operation of their projects
throughout the investment life-cycle, to help them resolve any difficulties they might experience;
and assisting qualifying investors, on a priority basis (and at reduced fees and/or charges), in
obtaining licenses, meeting other requirements and procedures (including the processing of
applications), and by granting simplified investment document approval and shortened timeframes
for approvals. For more examples, see Karl P. Sauvant and Evan Gabor, “Facilitating sustainable
FDI for sustainable development in a WTO Investment Facilitation Framework: four concrete
proposals”, Journal of World Trade, vol. 55 (2021), box 1, last accessed on March 12, 2022.
40 For an elaboration, see ibid.
41 Considered are here only specific technical measures, such as the provision of incentives,
financial support and information, i.e., not bilateral investment treaties and other treaties of this kind.
42 For a comprehensive discussion of such measures, see Jan Knoerich, Matthew Stephenson
and Heather Taylor-Strauss, OFDI Policy Toolkit for Sustainable Development (Bangkok/London/
Geneva: UNESCAP, Kings College London and World Economic Forum, 2021) available here, and
Karl P. Sauvant, Persephone Economou, Ksenia Gal, Shawn Lim, and Witold P. Wilinski, “Trends
in FDI, home country measures and competitive neutrality,” in Andrea K. Bjorklund, ed., Yearbook on
This includes all high-income (primarily developed) countries and more and
more upper-middle-income developing countries, although not many lower-
middle-income and low-income countries seemed to have moved into this
direction. Home country measures make it easier for investors to invest abroad;
and, to the extent that they help in this respect, they lead to higher FDI flows
of benefit to host countries. But home countries also have their own interests
in mind. In particular, home country measures are intended to facilitate their
firms’ efforts to establish an international portfolio of locational assets that
provides these firms with better access to various resources and markets and,
in this manner, strengthen their competitiveness.43 Home country measures can
also be linked—as some home countries do—to taking actions that have a
positive development impact in host countries. For example, home country
support can be tied to the requirement of undertaking environmental assessment
studies, (at least) in the case of large projects. This last requirement can also be
extended to a more general requirement, namely to require outward investors
to engage in responsible business conduct.44
Accordingly, it has been advocated in the negotiations to encourage home
countries to assume certain obligations, at least of a “best effort” kind. In
particular, they include adopting or maintaining measures that facilitate outward
FDI and, in particular, increasing the transparency of measures they have put
in place. Such measures relate to information about the regulatory framework
and investment opportunities in host countries; investment guarantees;
investment insurance; technical assistance; investor support services, such as
training (especially of small and medium-size enterprises (SMEs)), feasibility
studies, business missions, and matchmaking; financial and fiscal measures,
such as loans, equity participation, tax exemptions, and tax deferrals; cooperation
of IPAs in home and host countries; and the sharing of information with host
countries on the operations of outward investors, including in regard to their
history of responsible business conduct and sustainable FDI.
Home countries could also create a focal point to which outward investors
could turn to obtain this (typically) dispersed information, analogous to the focal
points foreseen in the Agreement for host countries, to help inward investors
obtain information. And, importantly (from the perspective of sustainable FDI),
certain outward FDI measures should be tied to undertaking development,
environment and social impact assessments of the (large) investments supported.
More generally, many of the measures envisaged currently and listed in the
draft Agreement under “transparency of investment measures”, “streamlining
International Investment Law & Policy 2012-2013 (New York: OUP, 2014), pp. 3–107, last accessed
on March 4, 2022.
43 Moreover, home country measures can benefit home countries directly, e.g., when tying
such measures, for example, to the obligation to give priority to selling raw materials to home
countries when mining ventures are supported.
44 See, e.g., the European Commission’s “Proposal for a Directive on corporate sustainability
due diligence”, February 23, 2022, last accessed on March 4, 2022.

and speeding up administrative procedures”, and “focal points, domestic

regulatory coherence and cross-border cooperation” are also applicable, mutatis
mutandis, to home countries (independently of any specific measures relevant
for home countries only).
If eventually included, such home country measures would be especially
important for SMEs, and there are literally tens of thousands of such firms
undertaking outward FDI—which, however, is a small subset of all SMEs. More
SMEs could invest abroad if certain handicaps could be overcome for these
firms to internationalize. These include that SMEs typically have limited
capacity to undertake the necessary background and preparatory work to
identify investment opportunities, determine the nature of the regulatory
framework in host countries, undertake feasibility studies, and so on. Moreover,
the institutional structure in home countries regarding outward FDI is quite
fragmented: it is hence often difficult to learn about such measures and to
utilize them, creating an impediment especially for SMEs.
Including home country measures in the Agreement is fully in line with the
Joint Statements that provide the mandate for the negotiations:45 they merely
speak about facilitating FDI flows. And such facilitation can be done by both
home and host countries—nothing indicates that facilitation should only be
done by host countries. In fact, politically it would be desirable if obligations (or
best efforts) were not only agreed upon for host but also for home countries.46
However, it may be asking too much to ask lower- and low-income countries
to put such measures in place, even if they facilitated FDI. Indeed, so far, it is
primarily high- and upper-middle-income countries that have home country
measures programs in place. Hence, such a requirement in an IFD Agreement
could be addressed only to high-income (primarily developed) countries and
upper-middle-income developing countries (as defined by the World Bank
Group), or be formulated as a best-efforts provision. However, and in any case,
if Members have home country measures in place, the Agreement should call
for the transparency of such measures.
In fact, in one area it appears agreed that home countries need to take
actions, namely in the area of responsible business conduct.
V. MNES: RESPONSIBLE BUSINESS CONDUCT
Specifically, WTO Members are being asked in the draft Agreement’s Section
on “Sustainable Investment” to encourage investors to voluntarily incorporate
responsible business conduct practices contained in internationally recognized
principles, standards and guidelines that have been endorsed or are supported
45 Referenced earlier.
46 Relevant is here a provision on cross-border co-operation on investment facilitation: it
requires Members (including home countries) to provide information on any measure covered
by the Agreement and to encourage cooperation between their competent authorities, including,
e.g., to exchange information on domestic investors and to promote facilitation agendas.
by the Members implementing this provision. Such principles, standards and

guidelines of responsible business conduct could include the United Nations
Guiding Principles on Business and Human Rights, the ILO Tripartite
Declaration of Principles Concerning Multinational Enterprises and Social
Policy and the OECD Guidelines for Multinational Enterprises. Related to that,
Members are being asked to encourage investors to maintain meaningful
engagement and dialogue with indigenous peoples, traditional communities
and local communities. Negotiators are also considering exchanging
information and best practices on these matters in the WTO Committee on
Investment Facilitation to be established through the Agreement. Finally,
negotiators are considering recognizing the importance of undertaking due
diligence to avoid adverse impacts of investments.
Two observations are in order here. First, while the first of the instruments
listed in the preceding paragraph focuses on human rights and the second on
social policy issues, the OECD Guidelines also cover a range of other issues
central to development;47 examples include actions with respect to science and
technology, competition and taxation. The reference to the OECD Guidelines is
therefore directly relevant for increasing the economic development contribution
of FDI and, therefore, is of particular importance for developing countries.
Second, the provision seems to mandate that both home and host countries
undertake certain actions, namely to encourage investors to voluntarily observe
responsible business conduct practices.48
Promoting responsible business conduct—although largely in the weak
version of just “encouraging” investors—is becoming a trend in international
investment agreements.49 It would be desirable if Members were actually required
to encourage (e.g., “shall encourage”) investors and undertake consultations with
stakeholders; this would strengthen the provision, even if the reference is only
to instruments to which governments have already committed themselves.
Moreover, anticipating possible ways to facilitate the uptake of responsible
business practices (e.g., in the WTO Investment Facilitation Committee) leaves
room for further strengthening this approach in the future. This could be done
by not only asking investors to (voluntarily) incorporate certain international
standards into their business practices, but also to “observe” these standards—
47 For some Members, however, it is difficult to refer to instruments and organizations to
which they are not party. This, however, can be addressed by simply referring to instruments to
which a Member is a party, as mentioned above.
48 It is conceivable that the stress on voluntarism may be overtaken by the spread of
national laws establishing mandatory social, environmental and governance obligations on

firms operating within national jurisdictions. The Agreement may need to address that situation
as well.
49 See, Peter Muchlinski, Multinational Enterprises & the Law (Oxford: OUP, 2021), pp. 570–
572, 695–705, last accessed on March 4, 2022, and Peter Muchlinski, “Can international
investment law punish investor’s human rights violations? Copper Mesa, contributory fault and
its alternatives”, ICSID Review (forthcoming 2022).
and perhaps not only international standards, but also their own corporate social
responsibility commitments (which a growing number of MNEs undertake).50
VI. SPECIAL AND DIFFERENTIAL TREATMENT, TECHNICAL ASSISTANCE

AND CAPACITY BUILDING
Finally, and very importantly, countries, and especially developing countries

and the least developed countries (LDCs) among them, only benefit fully from
the Agreement in terms of advancing their development if they can implement
it its entirety. But we know from a detailed study51 that many developing
countries—and especially the LDCs among them—ruefully lag behind in putting
various investment facilitation measures in place. This is not necessarily for lack
of ambition: many of these countries simply do not have the resources to do
so. To illustrate: investment promotion agencies are among the FDI-competent
institutions in host developing countries that most likely will need to implement
many of the measures contained in the Agreement. Their annual budgets, on
average, are $21 million for upper-middle-income countries, $5 million for
lower-middle-income countries and $2 million for low-income countries.52
The budgets of sub-national IPAs are often below $1 million or even below
$500,000. It is clear, therefore, that FDI-competent institutions in developing
countries—and especially LDCs—will need substantial technical assistance
and capacity building to implement the Agreement and hence benefit from it.
Two considerations follow from this situation: developing countries need
special and differential treatment regarding the implementation of the
Agreement, and they will need technical assistance and capacity building for
implementation.
As to the first consideration, the draft Agreement does recognize the
special difficulties that developing countries face in implementing the Agreement.
It foresees, therefore, that developing countries self-designate the pace at which
they implement the Agreement’s provisions. For this purpose—and following
the precedent of the TFA—it groups the draft Agreement’s implementation
commitments into three categories, differentiating between developing and
least developing countries: provisions that can be put in place immediately
upon entry into force of the Agreement (Category A); provisions that will be
implemented on a date after a transitional period (Category B); and provisions
that, after the transitional period, require technical assistance and support for
50 International investors themselves overwhelmingly recognize the importance of

international standards; see, Reil et al., op. cit.
51 See, Berger et al., op. cit., last accessed on June 15, 2022.
52 World Bank, “State of investment promotion agencies: evidence from WAIPA-WBG’s joint
global survey” (Washington, D.C.: WBG, n.d.), last accessed on March 4, 2022. In a 2018 publication,
it was noted that “in 2018, most of them [the IPAs surveyed] had budgets up to US $1 million”;
see, Armando Heilbron and Hania Kronfol, “Increasing the development impact of investment
promotion agencies”, in World Bank, Global Investment Competitiveness Report 2019/2020
(Washington, D.C.: World Bank, 2020), p. 178, last accessed on March 4, 2022.
capacity building for implementation (Category C). Moreover, there are flexibilities
built into the draft Agreement in this respect: for instance, implementation
dates can be extended and Members can shift measures between categories.
Importantly, as already noted for the third category of measures, implementation
is linked explicitly to countries having implementation capacity, i.e., where this
capacity is lacking, implementation has to wait until such capacity is acquired.53
This leads directly to the second consideration: the need for technical
assistance and capacity building to help implement the provisions of the
Agreement. There is agreement that donor countries should endeavor to provide
such assistance and support for capacity building, either bilaterally or through
the appropriate international organizations; and donor countries include
developed countries as well as developing countries in a position to provide
technical assistance and support for capacity building. Areas for technical
assistance could include building the expertise of relevant authorities to
strengthen their capacities to maximize positive impacts of FDI; building
capacity for the preparation of feasibility studies for investment projects,
including environmental and social impact assessments and regulatory and
administrative requirements; and assistance to better understand and implement
the requirements of the Agreement and to meet their notification deadlines.
Providing support for technical assistance and capacity building follows
the TFA model, which provides: “Donor Members agree to facilitate the provision
of assistance and support for capacity building to developing country and least-
developed country Members”.54 For that purpose, the WTO’s Director-General,
in cooperation with the African and LDC Groups and the Organisation of African,
Caribbean and Pacific States, established a trust fund in 2014—i.e., it was not
foreseen in the TFA itself. It is funded on a voluntary basis by donor Members.55
Implementing the IFD Agreement will require more resources than
implementing the TFA. Implementation of the latter often involves one-off
transactions and related at-the-border issues and engages primarily customs
agencies and other border agencies (but can also involve agencies physically
not present at the border, but that rely on customs agencies to administer their
requirements and fees, such as environmental agencies) at the national level;
implementation can also utilize the infrastructure of the World Customs
Organization.56 Implementing the IFD Agreement, on the other hand, involves
53 International investors themselves overwhelmingly recognize that host countries need
to strengthen their capacity to facilitate FDI flows; see, Reil et al., op. cit., last accessed on March
7, 2022. The approach that the implementation of an agreement is linked to the capacity of a
country to do so was introduced in the WTO in the TFA; see, “Statement by DG Azevêdo” on the
occasion of the launch of the WTO Trade Facilitation Agreement facility to deliver support to
LDCs and developing countries, last accessed on March 4, 2022.
54 WTO, “Trade Facilitation Agreement”, Art. 21, last accessed on March 4, 2022.
55 For the operation of the trust fund, see, https://www.tfafacility.org/facility/annual-
reports-workplans, last accessed on March 4, 2022.

56 It has been estimated that “the estimated total costs observed in 26 developing countries
and LDCs to reach full implementation of the TFA range widely, from USD 136,000 to USD 15.4
a wide range of behind-the-border issues related to the entire life-cycle of

investment projects, engages a great number of national and sub-national FDI-
competent authorities and is of interest to many stakeholders.
These two considerations—recognizing the special difficulties of developing
countries and the need of technical assistance and capacity building for them—
are closely interrelated: the pace at which developing countries choose to
implement the various provisions of the IFD Agreement is tied to the availability
of technical assistance and capacity building. This is particularly important for
LDCs as they have the highest implementation gaps. If the TFA is a precedent,
one can expect that substantial funds for technical assistance and capacity
building will be needed.
Accordingly, it would be very desirable if the Agreement not only recognized
the need for technical assistance and capacity building, but also contained a
firm commitment to provide substantial funds for this undertaking, ideally
through a trust fund established by the Agreement for this purpose. It is
encouraging, therefore, that the draft Agreement contains a proposal according to
which the WTO Investment Facilitation Committee shall explore the possibility
of establishing an Investment Facilitation Facility. It would be very desirable,
indeed, if a stronger version of this proposal were incorporated in the final text.
In this respect, the TRIPS Agreement could serve as a partial precedent. It
provided that: “In order to facilitate the implementation of this Agreement,
developed country Members shall provide, on request and on mutually agreed
terms and conditions, technical and financial cooperation in favour of developing
and least-developed country Members” (italics added).57 A similar commitment
in the final text of the Agreement could also include a commitment from
developing countries in a position to do so to offer technical and financial
cooperation.
To prepare for implementation, each developing and least developed
WTO Member that so requests will need to undertake self-assessments. They
would be needed, first, to determine in which of the implementation
categories A–C mentioned earlier the various investment facilitation
measures would have to be classified. Second, the self-assessments, in turn,
enable developing country Members to determine their technical assistance
and capacity building needs.
million… In PNG, for example, the National Trade Facilitation Committee recently estimated that
the total cost of the activities to be undertaken over a period of five years to meet full compliance
with the TFA, would amount approximately to USD 6.8 million, of which USD 1.4 million would
accrue to the PNG government and the private sector, and USD 5.5 million which would be
wholly, or partly financed by foreign donors.” See, Andras Lakatos, “Challenges for implementing
the Trade Facilitation Agreement” International Trade and Economics Series, 2016, pp. 5, 6, last
accessed on March 6, 2022. The establishment of a single window was the most expensive
provision to implement, with costs depending on how many agencies needed to be connected
and how sophisticated the system was.
57 WTO, “Agreement on Trade-Related Aspects of Intellectual Property Rights”, Art. 67, last

It would be desirable if self-assessments would already begin while the

negotiations are still in progress. (Before the negotiations of the TFA had been
concluded, 94 need assessments had been undertaken during 2007–2010 and
90 during 2013-2014.58) They would need to involve FDI-competent authorities
at the national—and, where applicable, subnational—levels, as well as key
stakeholders.59 This would put developing countries in a better position to
ascertain in which areas they need to take action, what action needs to be taken
and how much time and resources these actions would require. It would
furthermore help in the process of arriving at a realistic, factual and evidence-
based self-designation and at determining requirements of technical assistance
and capacity building. Moreover, self-assessments would help build a
constituency, in each country, that is familiar with the range of issues related
to the implementation of the Agreement. All this, in turn, would contribute to
the speedy implementation of the Agreement.
To assist such a self-assessment process, furthermore, it would be useful
to have a standard template for gap analyses and need assessments and a guide
explaining and exemplifying the provisions of the Agreement. This would not
only yield comparable results, but would also allow developing countries to
inform donors of the support needed. And it would lay the ground for the
notification of the WTO Investment Facilitation Committee of, among other
things, subsequent changes in FDI-related laws and regulations and the adoption
of new ones. It is therefore encouraging that the WTO IFD Agreement negotiators
agreed in February 2022 to establish a Working Group “to develop a Self-
Assessment Guide to help developing and least developed countries assess
their needs in terms of implementing the future agreement”.60 The Working Group
is coordinated by the WTO Secretariat, and its members consist of representatives
of international organizations working on investment facilitation. It is conceivable
that self-assessments will begin in 2023.
VII. CONCLUSIONS
What does all this mean in terms of the question I asked at the beginning,
namely: how would a WTO Agreement on Investment Facilitation for
Development encourage sustainable FDI flows, and how could it be further
strengthened in this respect? Although the negotiations are still ongoing,
preliminary answers are possible.
The WTO draft Investment Facilitation for Development Agreement
recognizes the importance of FDI in furthering sustainable development. To
58 Information provided by the WTO Secretariat.

59 Stakeholders could include, apart from various government and government-related
entities at the national and sub-national levels, foreign investors, business associations, trade
unios, consumer associations, research institutions, and other civil society organisations.
60 WTO, “Investment facilitation negotiators take steps to assess needs of developing
countries”, February 15, 2022, last accessed on March 4, 2022.

this end, it identifies a wide range of specific, concrete, technical measures that
facilitate FDI flows that, in turn, help advance development. While the draft
Agreement lays out primarily actions to be taken by host countries, it also
addresses home countries and, indirectly, MNEs.
Beyond that, and focusing on sustainable FDI for sustainable development,
the draft Agreement recognizes prominently the importance of sustainable
development. In particular, it anchors the concept of “sustainable investment”
in an international investment agreement, an important conceptual and
political action. Moreover, it operationalizes this concept by identifying a few
concrete measures that directly increase the development impact of FDI,
although one key measure—supplier development programs—still requires
consensus. Importantly, not only host countries have obligations, but it has
also been proposed that home countries have obligations regarding investment
measures, and these are of particular importance to SMEs. Home countries
seem to have, in fact, assumed one particular obligation, namely to require
their investors to incorporate (admittedly voluntarily) internationally recognized
responsible business conduct standards into their practices, referencing these
explicitly. While this provision also applies to host countries, home countries
are often in a stronger position to advocate such conduct. This is further
complemented by the recognition of the importance of consulting certain
stakeholders. And these provisions, in turn, create, at least indirectly, obligations
for investors. More generally, addressing home countries and MNEs—apart
from host countries—introduces an element of balance in terms of obligations
taken by the principal actors in the FDI space.
Importantly also, the draft Agreement recognizes the need for special and
differential treatment of developing countries (and especially LDCs) regarding
its implementation. This includes that Members can self-designate the pace of
implementation of individual provisions, and that Members in a position to do
so should provide support for technical assistance and capacity building. In
this respect, it is encouraging that work on a self-assessment instrument to
help countries determine the pace at which they can implement the Agreement
and to identify their technical assistance and capacity building needs has
begun. More broadly, finally, the Agreement would constitute a commitment
device and a benchmark, a tool that helps countries’ FDI-competent authorities
to upgrade their FDI frameworks, with a view toward attracting the FDI they
need to advance their development. All in all, this is a substantial contribution
toward facilitating the flow of sustainable FDI for sustainable development.
Could more be done? Of course—and a number of areas for further
strengthening the draft Agreement have been outlined earlier in this text. Since
the negotiations are still ongoing, and if negotiators have the political will, they
have the opportunity to strengthen the Agreement further. They may also want
to agree on a built-in agenda to lay the statutory foundations for further
negotiations on specific measures.
In the end, negotiators have to balance what is desirable with what is

achievable, without overloading the negotiations process—the perfect cannot
become the enemy of the good. Considering the slow pace at which progress is
being made in international negotiations in general and the difficulties of
negotiating under the unfavorable conditions of the pandemic and current
international relations in particular, the progress that has been made since
September 2020 is remarkable. Developing countries, which are central to the
process, have made great strides in moving the negotiations process forward,
and they have achieved a great deal so far, including elements of break-throughs
in international investment law. They will be able to build on that success once
the Agreement has been concluded and the WTO Investment Facilitation
Committee has been established.
International treaty-making—like politics—is the art of the possible.
Negotiators still have time before the deadline they have set themselves at the
end of 2022 to see what is still possible.
Chapter 3
THE NEW INVISIBLE COLLEGE
Patrick Pearsall*
We are living through an inflection point. Right now, the ground of

international law is shaking. We are struggling to gain our balance and the
international order continues to rumble beneath us.
What does investment protection mean in a world where economic
sanctions are the primary non-kinetic tool of restraining illegal actions by a
state? What does it mean to protect investment in that context?
How do we calibrate orthodox customary international law conceptions of
the minimum standard of treatment or expropriation when economics are
more political than ever?
I am reminded of an article written by another of Columbia’s greatest
professors, Oscar Schachter. Professor Schacter wrote an article in 1977 where
he posited, famously, that there is “an invisible college of international lawyers.”
This college of lawyers is charged with, and responsible for, maintenance of
international law—peace, human rights, liberty. Watchers on the wall,
protecting the global order. Unbound by national allegiance—fidelity first and
foremost to propping up and stitching together a system of law on which our
lives and freedom depend.
The peaceful settlement of disputes is a foundational principle of this
global order that the “invisible college of international lawyers” is charged
with protecting. International arbitration, including international investment
arbitration, is one tool in the international lawyer’s toolkit to keep up on the
solid ground of the rule of law. No gunboats seeking payment of an alleged
debt, no nationalist dictators threatening less powerful economies that they
must bend to their will: instead—international norms, international law, a
jurisprudence and forum.
Professor Schachter lived through an earthquake of international law—the
catastrophic events and realignment of the global order after World War II. He
spent his life propping up, stitching together—establishing the individual as a
subject on international law. May his memory and work be a blessing to us all.
But now we are faced with the most significant realignment of the global
order since 1945. The catastrophic events in Ukraine are a seismic jolt in what
has been a slow rumble over the past five years.
* Patrick Pearsall is a Partner at the Washington D.C. office of Allen & Overy LLP. He has
extensive experience representing parties in international disputes and providing strategic advice
on investments and commercial contracts. He served in the U.S. State Department for nearly a
decade, working on economic and natural resource diplomacy, and departed as the Chief of
Investment Arbitration.
33
What does it mean to have a national economy? What does it mean to be a

geo-political economic actor? And what does all of this mean for the future of
investment protection? Is foreign direct investment the best hope to accomplish
Friedman’s thesis that nations that trade with one another don’t go to war with
one another? And what is the role of the non-state actors in this space? Google,
Meta, Twitter, Exxon, Citibank, etc.
We are all on this shaky ground together. We must grab hold of one another
to gain our balance and reestablish a new legal consciousness. We look to
leaders like Professor Bermann to help shore up our foundation. We only have
each other—this invisible college of international lawyers.
International economic rights are one essential part of the legal consciousness
that makes up the global world order and international investment arbitration
is an engine for the peaceful settlement of disputes.
One final quote from Professor Schachter, Professor Bermann’s one-time
colleague—writing for the future. Writing for you and me. Professor Schachter
made clear, the progress of legal consciousness is ours. He said, at the end of
his article:
“Since the Governments of the world are likely to be ambivalent about “the
legal consciousness,” the role of the nonofficial community of lawyers in giving
that conception meaning and effect may well constitute the noblest function of
our invisible college.” I know that is what Professor Bermann does through his
many foundational works of scholarship. My hope is that he continues to
inspire for many more years.
Chapter 4
BEAT THE BITS: DELINEATING THE MONOPOLY
ON THE INTERPRETATION OF EU LAW AND ITS
IMPLICATIONS
Petros C. Mavroidis and Kabir Duggal*
I. FROM ACHMEA TO MICULA TO KOMSTROY TO PL HOLDINGS . . .

WHAT CAN WE LEARN?
In its Achmea (C-248/16) and, more recently, in Micula (Cases T-624/15,

T-694/15 and T-704/15) decisions, the European Court of Justice (CJEU)
seems to have made a decisive turn, a conscious choice, that opening up to
foreign jurisdictions might eviscerate the homogeneity in the interpretation and
application of EU law, since its quintessential elements risks being misunderstood
by foreign judges and arbitrators. But in its advisory opinion 1/17 dated April 30,
2019, the CJEU saw no inconsistency between the establishment of an ISDS
(investor-state dispute settlement) mechanism in CETA (Canada-European
Union Trade Agreement) since the established forum would not be interpreting
EU-, but CETA law. Following this, the CJEU issued two decisions restricting
intra EU dispute settlement through ISDS. In the Komstroy decision (C-741-19),
the CJEU concluded that the investor-state dispute settlement in the Energy
Charter Treaty, which involved both EU and non-EU member states, could not
be used to resolve intra-EU disputes. In the PL Holding decision (C 109/20),
the CJEU ruled that ad hoc arbitration agreement between an intra EU investor
and member state was incompatible with EU law. This begs the question—
where exactly lie the limits of EU law? Is not international law (e.g., CETA)
supposed to be an integral part of EU law? These are the themes we would like
to address in this short Note.
II. WHEN MEMBER STATES CONTRACT
Achmea, Micula, Komstroy, PL Holdings, and Opinion 1/17, all concern cases
where an ISDS was established through an international agreement. The
difference is this: in the first four cases, it is EU member states that contracted
the ISDS; in the latter, it is the EU that signed it with a foreign state. We divide
our discussion accordingly.
* Petros C. Mavroidis is Edwin B. Parker Professor of Foreign & Comparative Law at
Columbia Law School. Dr. Kabir Duggal is a Lecturer in Law at Columbia Law School and an
Attorney in Arnold and Porter’s New York office. For helpful discussions, we would like to thank
Professors Gerry Neuman and Mark Wu, at Harvard Law School.
35
A. The Achmea, Micula, Komstroy, and PL Holding Decisions
The Achmea decision brought the ISDS controversy in relation to intra EU

BITs to the forefront. The case originates in an award rendered in December
2012 by an arbitration tribunal established under the BIT between the Slovak
Republic and the Kingdom of the Netherlands (Cantore and Mavroidis (2018)
discuss this case in sufficient detail). The BIT was actually negotiated between
Czechoslovakia and the Netherlands. It was concluded in 1991 and entered
into force in 1992. The Slovak Republic succeeded in the rights and obligations
of Czechoslovakia under the aforementioned BIT in 1993, after the “velvet
revolution,” a few years before its accession to the EU (2004). Achmea is a
Dutch supplier of insurance services. When the Slovak Republic reformed its
health system in 2004 and opened up its private sickness insurance market,
Achmea obtained the necessary authorizations to operate a subsidiary in that
country. In 2006 and 2007, the Slovak Republic partially modified the pre-existing
regime, and prohibited the redistribution of profits generated by private
providers in the health insurance market. Achmea challenged the measures in
ISDS arbitration proceedings against the government of the Slovak Republic.
The arbitral tribunal chose Frankfurt as its seat, as per the applicable United
Nations Commission on International Trade Law (UNCITRAL) rules. In December
2012, the arbitral tribunal found in favor of Achmea, and ordered the Slovak
Republic to pay damages of over 22 million euros. The Government of the
Slovak Republic brought an action to set aside the arbitral award before local
courts in Germany. Whilst the Higher Regional Court in Frankfurt dismissed the
action, the Federal Court of Justice, on appeal, filed a request for a preliminary
ruling before the CJEU. The referring court submitted questions concerning the
compatibility of the arbitration clause contained in Article 8 of the Dutch-
Slovak BIT with Articles 18, 267, and 344 of the Treaty on the Functioning of
the European Union (TFEU). Put simply, the matter before the CJEU was whether
a provision in an international agreement between two Member States, whereby
an investor originating in one of these Member States has the right to bring
proceedings against the host Member State before an ISDS arbitration tribunal
(rather than a domestic court), is consistent with EU law.
The CJEU started its analysis by recalling its settled case law whereby an
international agreement cannot affect the allocation of powers as determined
by the EU treaties and the “autonomy” of the EU legal system (§32). The gist of
the argument is the following. The treaties constitute the primary law of the
EU legal order. They have primacy over the domestic law of the Member States,
which are under the duty to cooperate in order to ensure that EU law is
faithfully implemented. To prevent divergent interpretations of the same
provisions of EU law by local courts of law, Article 267 of the TFEU allows the
courts of Member States to submit requests for preliminary rulings to the CJEU
concerning the interpretation of the Treaties or the validity of acts of the EU
institutions. When such courts or tribunals are of the last instance, they are
DELINEATING THE MONOPOLY ON THE INTERPRETATION OF EU LAW 37
obliged to do so. According to settled case law, for a judicial body to be a “court
or tribunal” for the purposes of Article 267 TFEU, that is, for a “court or tribunal”
to have the right to refer issues for a preliminary ruling to the CJEU, the referring
court must be based in a Member State. Clearly, a court not based in a Member
State is under no obligation to refer to the CJEU a question for a preliminary ruling.
Against this background, the CJEU examined the content of the BIT at the
origin of the dispute. In particular, Article 8 thereof included an arbitration clause,
whereby arbitral tribunals could be established to rule on cases concerning the
alleged infringement of the BIT (§§ 45 et seq.). Article 8(6) of the BIT, in particular,
provided that arbitrators must take into account the law in force of the parties
as well as any other relevant agreements between them. The CJEU found that the
tribunal envisaged in the BIT was not part of the judicial system of the two
member states concerned and, therefore, could not be considered to be a court
or tribunal of a Member State for purposes of Article 267 TFEU (§ 49).
The CJEU distinguished between the arbitral tribunal in the Dutch-Slovak
BIT and other mechanisms for the resolution of disputes that had survived its
scrutiny. For instance, the Court had previously ruled that a tribunal common
to two or more Member States, such as the Benelux Court of Justice, was not
incompatible with the EU treaties (Case Parfums Christian Dior). Whilst the
CJEU saw no problem with the Benelux Court of Justice because it represents a
“step in the proceedings” before the national courts of the Member States
concerned, it found no such links between intra-EU BITs and the judiciary of
the relevant member states. The Benelux Court though can refer cases involving
interpretation of EU law to the CJEU for a preliminary ruling. Based on the
foregoing, the CJEU concluded that an arbitral tribunal like the one established
pursuant to Article 8 of the Dutch-Slovak BIT was not a court of tribunal of a
member state of the EU and, therefore, could not submit requests for preliminary
rulings to the CJEU under Article 267 of the TFEU (§§ 46–49).
The CJEU concluded its decision with a caveat, and affirmed that, in principle,
an international agreement establishing a court tasked with the application
and interpretation of the rules set forth therein is not in principle incompatible
with EU law, provided that it respects the autonomy of the EU legal order.
Micula is not that different. Romania, pre-accession to the EU, had concluded
a BIT with Sweden. Upon accession, Romania revoked tax advantages in favor
of Swedish investors following the Commission’s line of thinking that, if this
had not been the case, Romania would be providing a state aid incompatible
with the TFEU. The investors prevailed during an ICSID (International Centre
for Settlement of Investment Disputes) arbitration that they initiated. When
Romania complied with the award, the Commission issued a decision condemning
Romania for providing state aid. Investors challenged the award and in January
2022, the CJEU upheld for all practical purposes the Commission’s view. The
reason was very similar to that in Achmea: the contracting parties could not have
excluded EU law from their interstate relations, the monopoly of interpretation
of which belonged to the CJEU. The decision in Komstroy and PL Holdings sealed
the fate of the final issues by concluding that the ECT and ad hoc arbitration
agreements between intra EU members were incompatible with EU law.
B. Opinion 1/17
CETA establishes a novel dispute resolution mechanism with the creation

of a CETA tribunal of first instance and a CETA Appellate Tribunal. These
bodies will be called to interpret CETA, and more specifically, the investment
chapter. The question of consistency with the EU legal order naturally arose (a
lot has been published already on this score. Eckes (2020) and Fanou (2020)
focus on themes close to our study). Many feared a disaster. And yet, in two
paragraphs, the Court managed to allay fears and silence the Cassandras:
133. Nor will the CETA Appellate Tribunal be called upon to interpret
or apply the rules of EU law other than the provisions of the CETA.
Article 8.28.2(a) of that agreement states that the Appellate Tribunal
will be able to “uphold, modify or reverse the Tribunal’s award based
on … errors in the application or interpretation of applicable law”, that
“applicable law” covering, in the light of the law to be applied by the
CETA Tribunal under Article 8.31.1 of that agreement, the CETA and
the rules and principles of international law in the light of which that
agreement has to be interpreted and applied. While Article 8.28.2(b) of
the CETA adds that the Appellate Tribunal may also identify ‘manifest
errors in the appreciation of the facts, including the appreciation of
relevant domestic law’, it is nonetheless clear from the preceding
provisions that it was in no way the intention of the Parties to confer
on the Appellate Tribunal jurisdiction to interpret domestic law.
134. Since the CETA Tribunal and Appellate Tribunal stand outside the
EU judicial system and since their powers of interpretation are confined
to the provisions of the CETA in the light of the rules and principles of
international law applicable between the Parties, it is, moreover,
consistent that the CETA makes no provision for the prior involvement
of the Court that would permit or oblige that Tribunal or Appellate
Tribunal to make a reference for a preliminary ruling to the Court.
III. UNDERSTANDING THE DIFFERENCES
It seems to us that there are two axes that matter:
• The autonomy of EU law, which is sacrosanct in the eyes of the CJEU; and
• The scope of EU law.
The CJEU had the opportunity to define the boundaries of the notion of
“autonomy” of the EU legal order when it rendered its Opinion 2/13 on the
DELINEATING THE MONOPOLY ON THE INTERPRETATION OF EU LAW 39
EU's accession to the ECHR. There, the CJEU affirmed that dispute settlement
mechanisms in international agreements to which the EU is a party are, in
principle, not inconsistent with EU law (§182). This finding notwithstanding,
the Opinion contained a strong proviso that undermined its practical importance.
The CJEU in fact affirmed that the decisions of the institutions of the ECHR,
including those of the European Court of Human Rights (ECtHR), should not
bind the EU and its institutions to follow a particular interpretation of the rules
of EU law (§184). The key to the respect for the autonomy of the EU legal order,
therefore, seemed to be leaving the last word on the interpretation of EU law
to the CJEU.
But does EU law not also comprise international law as per the standing
understanding of the CJEU? Is not it the CJEU after all that in C-66/18 struck
down a Hungarian law for violating obligations assumed under the WTO? If it
can do it with respect to WTO, why not with respect to CETA (which subject-
matter wise overlaps with the WTO? Or does the Court draw a distinction
between cases where it can, and cases where it must intervene? If yes, what
are the statutory underpinnings?
And then there are a few, more dis-aggregated points, we would like to touch
upon.
A. What Do the Cases Say About EU Law?
International courts and tribunals are called to evaluate whether states (or
individuals when that possibility is provided for) have violated certain provisions
of an international agreement. Indeed, evaluations based on domestic law are
often necessary to better understand the terms of a dispute. Would a factual
evaluation requiring the interpretation of provisions of EU law be allowed? The
European Commission seems to be aware of the problems that the conservative
attitude of the CJEU may cause. In this respect, they have introduced language
in the text of the investment disputes chapter of CETA according to which the
domestic law of the parties can only be considered by the Investment Tribunal
“as a matter of fact.”
Surprisingly, in the Achmea decision, the CJEU concluded that its finding
would not apply “apply to commercial arbitration” since such disputes “originate
in the freely expressed wishes of the parties.” If the issue, however, is the
application of EU law, commercial arbitral tribunals could equally decide
matters of EU law. For now, the CJEU has not raised any objection on this front.
B. Can an International Judge Submit a Request for a Preliminary Ruling

to the CJEU?
The CJEU has reserved the possibility to submit requests for preliminary
rulings to courts and tribunals of a member state which meet certain conditions,
which have been explained in detail elsewhere (Wahl and Prete, 2018). In Dior,
the Court found that the Benelux Court met the relevant requirements. The
Complaints Board of the European Schools had a less lucky destiny. The Court
in Miles concluded that the Board was established within an international
organization that, despite the existence of certain links, was distinct from the
EU and its Member States. Interestingly, the Board is required to apply general
principles of EU law in the settlement of disputes. Thus, on the one hand, the
Court requires all judicial bodies, even theoretically applying EU law, to
respect its authority and to diligently submit preliminary ruling requests in
case of doubt, and yet it rejects such requests when they come from bodies that
are physically based in the EU and do apply EU law in the settlement of disputes.
C. Does it Matter if it Is the Member States or the EU that Has Contracted?
The decisions have had the expected outcome. In October 2019, the European
Union presented the “Agreement on a Plurilateral Treaty for Termination of
Intra-EU BITs.” This treaty terminated all intra-EU BITs along with the sunset
clause 23 of the 27 Member states signed this agreement by mid-2020 and it
entered into force in late August 2020. The European Commission has also
initiated infringement actions for the states that did not terminate the intra-
EU BITs. Member states cannot of course contract with foreigners as a result of
the new attribution of competences following the passage of the Lisbon treaty.
So the CJEU leaves this ground open for the EU alone (Compare Bronckers
(2007) and Lock (2009)).
IV. CONCLUDING REMARKS
Several scholars and practitioners have referred to the CJEU as “the

gatekeepers” of the autonomy of EU law, both externally (Snyder, 2003), as well
as internally (Wahl and Prete, 2018). Bermann (2017) himself, who divided his
academic life between EU law and investment / commercial arbitration,
highlighted the role that national courts can play in this context, and the potential
issues that might arise. But the CJEU does not seem to find a way to reconcile
with the idea that it might co-exist with other international adjudicating systems.
The primacy that the EU believes it has for European law is not different that
the arguments that other legal systems put forward for the primacy of their
own law. Employing a formal criterion to distinguish between legal orders, will
allow it to open up to international adjudication, a key feature in today’s world
characterized by the proliferation of international contracts. In this sense, a
provision in a free-trade area or an ISDS, even if identical to EU law, belongs to
a distinct order, and its interpretation can never undermine the autonomy of
EU law.
Chapter 5
PROMOTING EFFICIENCY IS PRO‐ARBITRATION
Rahim Moloo*
I. INTRODUCTION
Arbitration lawyers often talk about third parties (whether courts,

governments, or other lawyers) as being pro-arbitration or anti-arbitration.
Presumably most arbitration lawyers are pro-arbitration. Self-preservation
is a safe bet. But this also begs a question that Professor George Bermann
has asked: what does it mean to be pro-arbitration? (George Bermann, What
does it mean to be “pro-arbitration”?, Arbitration International, 2018, 34,
241–353).
I suggest that arbitration lawyers can be characterized as more or less pro-
arbitration based on how much they conduct themselves in a manner that
promotes arbitration as a more or less favorable dispute resolution mechanism.
It is not always clear whether certain traits often associated with arbitration
make arbitration more or less favorable. For example, promoting confidentiality
does not necessarily make arbitration better than litigation—some may prefer
it, but it does not always assist parties (or the public) in achieving a better
outcome to the dispute. But efficiency is a trait that most will agree is a desirable
trait for a dispute resolution system.
Parties and governments have designed systems to help resolve disputes
because people and entities desire to have their disputes resolved. They do
not wish to be stuck in disputes in perpetuity. And there is no societal good that
comes from disputes remaining unresolved. It wastes time, money, human
resources, and most importantly, it delays justice. So efficiency is a trait that
pro-arbitration lawyers (including arbitrators) should promote if they wish to
promote arbitration as a more favorable dispute resolution mechanism to
other options.
But not all arbitration lawyers promote efficiency. And, in fact, we can all
do more to promote more efficient proceedings. The remainder of this short
essay proceeds as follows. The next section, which is the core of this essay,
suggests ways in which arbitration lawyers can promote efficiency and, in turn,
be more pro-arbitration. The final section offers some concluding thoughts,
including on the intersection between efficiency and due process.
* Rahim Moloo is a Partner and Global Co-Chair of the International Arbitration Group at
Gibson, Dunn & Crutcher LLP and a Member of the Adjunct Faculty at Columbia University Law
School.
41
II. SOME THOUGHTS ON HOW TO BE MORE EFFICIENT IN

ARBITRATION PROCEEDINGS
There are several ways in which arbitration proceedings can be more efficient.
I do not attempt to catalog all of the available options here. Rather, my goal is
to discuss certain ideas that I do not see considered or instituted frequently but
ought to be considered by pro-arbitration lawyers or arbitrators more frequently.
A. Page Limits
Page limits are not a new idea, but they are rarely implemented until post-
hearing briefs, when everyone has finally realized that the thousands of pages
in the record have become unbearable and some discipline must be imposed.
I raise this as the first suggestion because it is the easiest to implement and
should be met with the least resistance.
Written pleadings in arbitrations—starting with the first memorial—are
too often unnecessarily voluminous and meandering. Such pleadings can
generally be much sharper and focused on the core issues in dispute, but there
must be an external impetus for parties to prepare shorter pleadings. Otherwise,
lawyers often default to longer submissions for fear of leaving something out.
Counsel would do their clients a service if they agreed, up front, on reasonable
page limits that allowed them to focus their pleadings on the important issues
while placing both parties on an equal footing. It is rarely the case where 100
pages for a memorial will not be enough—even in a complicated case—
especially when supplemented with witness statements and expert reports.
Where parties cannot agree on page limits, arbitrators should suggest such
limits taking into account the issues in dispute and their complexity. Doing so
can help to weed out extraneous issues and assist the parties and the tribunal
to get to the heart of a dispute much more efficiently.
B. Adjustments to the Standard Arbitration Timetable
When parties are setting the timetable at the outset of the proceeding, they
often start with a standard schedule of two rounds of memorial-style pleadings
with an intermission for discovery in between the first and second round. There
are four additional factors I suggest parties should consider when formulating
the timetable.
First, parties and tribunals ought to consider whether any legitimate,
dispositive issues can be decided on an expedited and discreet basis. Tribunals
increasingly hear arguments on dispositive issues on a preliminary basis where
such issues are discreet and not entangled with the merits. To avoid what is
meant to be a procedural mechanism to promote efficiency from causing further
delay, parties and tribunals should consider how long it would take to decide
the preliminary issue before deciding to hear it separately. It is too often the case
that a preliminary phase on jurisdiction (for example) derails the timetable for
PROMOTING EFFICIENCY IS PRO-ARBITRATION 43
two years, whereas the entire case could have been heard in three years
without the bifurcated detour. To avoid such an outcome, when dispositive
issues are heard on a preliminary basis, parties should commit to short
timelines for pleadings and tribunals should commit to issuing a decision on
the dispositive issue quickly after the parties’ submissions are in. They can do
so only when the issue in question is truly discreet and does not require extensive
(if any) fact evidence, including witness testimony. One way to shorten the
timeframe for deciding preliminary issues is to have only one round of pleadings
followed by a short hearing (which effectively serves as the second round of
submissions, but with the benefit of tribunal interventions).
Second, parties should include in the timetable a meeting between the
parties to discuss settlement of the dispute. Parties should consider building
in such a discussion after the first round of pleadings and discovery. By then,
the parties better understand each other’s positions and have a sense of the
strengths and weaknesses in their respective cases. Scheduling a set date for
settlement discussions avoids the inevitable hesitation of a party to be the first
to reach out to have a discussion with the other side for fear of being viewed
as weak. At the same time, scheduling a time for settlement discussions from
the outset forces the parties to sit down if neither party is otherwise inclined
to reach out to the other. If both parties sit down in good faith, it is possible
that a conversation opens the door to solutions that neither party had previously
considered (or considered viable). If settlement discussions resolve the dispute,
that would obviously save the parties time and money, and would hopefully
result in a solution that both parties can live with. On the other hand, it would
not have to delay the timetable if such discussions were injected into the process.
Third, parties should consider whether to move discovery up in the
timetable or allow for rolling requests with a particular expiration date some
time shortly after the first round of pleadings. The idea here is not to allow for
serial requests that inundate the other party. Rather, this proposal is meant to
expedite the most time consuming aspect of discovery—i.e., collecting documents.
The earlier a party knows what documents are being requested of it, the sooner it
can start looking for documents it might not yet have collected for purposes of
its own case. It is true that the full suite of documents a party—the claimant in
particular—might wish to request will not be known until after the respondent's
first pleading. However, by the time a matter reaches arbitration, and a request
for arbitration has been filed, counsel will likely be able to identify the vast
majority of material it will wish to ask for from the other side.
Fourth, tribunals should commit to issuing awards on a timely basis. It is
unreasonable to have to wait well over a year for an award in circumstances
where arbitrators are private individuals who are being compensated to
provide a service to the parties to issue that award in an efficient and fair way.
Parties and institutions also have a role to play in this regard: they should be
sure to appoint arbitrators with the time to dedicate to a case.
In sum, parties and the tribunal should be thoughtful at the outset of the
arbitration when setting the timetable. They should not fall into the trap of
adopting the standard timetable they are used to when being creative and
thoughtful at the outset might allow for a more efficient proceeding.
C. Penalizing Bad Behavior
There are times when a particular party makes an unmeritorious application

(or a series of applications) that delay the proceedings. In such circumstances,
tribunals should consider making an immediate adverse costs order in order
to disincentivize further applications that do nothing more than cause delay
and distract from the resolution of the main dispute. This does not mean that
every application that is made, but lost, should result in an immediate costs
order. For example, a party may be unsuccessful in challenging an arbitrator or
seeking interim measures, but a tribunal might find that the application was a
reasonable one to make. In such circumstances, an interim costs order would
be inappropriate. The objective is not to disincentivize applications in borderline
cases. Rather, an interim costs order should be used to moderate party behavior
where the conduct in question seems tactical—for example, when unmeritorious
applications are made serially.
D. Hearing Conduct
In my experience, arbitration hearings are generally quite efficient. However,

tribunals in particular should bear in mind two considerations.
First, most importantly, given that the goal of an arbitration (and in particular
the hearing) is to resolve any questions or issues the tribunal might have in
making its decision, it is particularly helpful for counsel to receive questions from
the arbitrators. Ideally, such questions are delivered to the parties in advance
of the hearing, but even if the tribunal is active in asking questions at the hearing
itself, that is helpful. It is disconcerting having to make oral submissions to a
tribunal that is not asking any questions because: 1) counsel can’t be sure they
are spending their time on the issues that concern the tribunal most; and
2) counsel cannot be sure that the tribunal fully understands their case when
no (or few) questions are asked. Tribunals should of course be careful not to
suggest that they have pre-decided an issue by issuing questions, but asking
questions ensures that the hearing time is spent addressing the key issues that
will ultimately make a difference to the outcome from the tribunal’s perspective.
Second, the use of technology can, of course, allow for hearings (or parts of
hearings) to take place remotely in appropriate circumstances. Witness
testimony, and any extensive oral submissions by counsel where a robust
back-and-forth with the tribunal is expected, are best held in person. But case
management conferences, hearings on dispositive issues, hearings on interim
applications, and even closing submissions, can take place over an online video-
PROMOTING EFFICIENCY IS PRO-ARBITRATION 45
conferencing platform in order to avoid the cost and time to travel. This is
because less time needs to be set aside when the parties and tribunal do not
need to travel for an in-person hearing.
III. CONCLUSION
As pro-arbitration practitioners, we have an obligation to improve our

system of resolving disputes. All things equal, increased efficiency is a virtue
that any pro-arbitration practitioner should promote.
Some might argue, however, that efficiency comes at a cost to due process.
Indeed, parties seeking to rebuff a more efficient proceeding will often cry foul
when procedures are proposed to expedite or streamline an arbitration. But
tribunals should not view efficiency and due process as a tradeoff. The idiom
“justice delayed is justice denied” is apt. Inefficiency is a risk to due process,
not a cost to preserving it. Tribunals should be weary of concerns that parties
are being deprived of the opportunity to be heard if they are told to spend less
words or time arguing their point. Most legal systems around the world impose
such limits on parties, and arbitration tribunals should not be scared to impose
similar disciplines. Rather, they should consider whether doing so allows
parties an adequate and equal opportunity to have their cases heard while
achieving an efficient resolution to the dispute.
It is time to think of new approaches, and to implement others that are
often discussed but not adopted, to achieve greater efficiency in international
arbitration. In the spirit of efficiency, this essay briefly discusses some of the
options that we should all consider in seeking to achieve this end.

Chapter 6
BEING “PRO‐ARBITRATION”: INSIGHTS FROM
THE EUROPEAN UNION’S APPROACH TOWARDS
INVESTOR‐STATE ARBITRATION
Ridhi Kabra and Gaëtan Verhoosel KC *
I. INTRODUCTION
It is a trite observation that being “pro-arbitration” means being friendly

to arbitration. Writing in 2018, Professor Bermann reminded the arbitration
community of the facile nature of this definition and took on the arduous task
of identifying more nuanced criteria for determining whether a policy or
decision is “pro” or “anti” arbitration.1 That led him to consider the role played
by values extrinsic to the narrow confines of arbitration. In a world where
arbitration’s legitimacy is often called into question,2 Bermann suggested
expanding the meaning of pro-arbitration to include consideration of extrinsic
values. The proposition was that trade-offs between arbitration and extrinsic
values should be considered “pro-arbitration” because they “enhance
international arbitration’s legitimacy overall” even though they might have an
adverse effect on “international arbitration’s interests narrowly conceived.”3
Bermann limited his inquiry to commercial arbitration, deciding specifically
not to engage with investor-State arbitration.4 But it is investor-State arbitration
where the call for such trade-offs has been loudest. A series of responsive
measures have been underway, ranging from incremental to invasive.5
Incremental changes involve the introduction of discrete reforms to the current
process of investor-State arbitration. Invasive changes entail the more drastic
* Dr. Ridhi Kabra and Dr. Gaëtan Verhoosel KC are, respectively, Associate and Partner at
Three Crowns in London. Any opinions expressed in this essay do not necessarily reflect the
views of Three Crowns or its clients.
1 G Bermann, “What Does it Mean to Be ‘Pro-Arbitration’?”, (2018) 34 Arbitration International
341.
2 See, e.g., S Schill, “Conceptions of Legitimacy of International Arbitration” in D Caron and
others (eds.), Practising Virtue: Inside International Arbitration (2015), p. 106; SD Franck, “The
Legitimacy Crisis in Investment Treaty Arbitration”, (2005) 73(4) Fordham Law Review 1521;
AJ van den Berg (ed.), Legitimacy: Myths, Realities, Challenges (ICCA Congress Series No. 18).
3 Bermann, supra n. 1, pp. 341, 352–353.
4 Bermann, supra n. 1, p. 342.
5 G Verhoosel, “Uncanny: Investment Arbitration’s Three Tales of Trouble”, (2019) 30(3)
American Review of International Arbitration 291; See also, A Roberts, “Incremental, Systemic,
and Paradigmatic Reform of Investor-State Arbitration”, (2018) 112(3) American Journal of
International Law 410.
47
measure of dismantling investor-State arbitration.6 The European Union (EU)

has been at the forefront of seeking these trade-offs—systematically removing
the possibility of investor-State arbitration for disputes between EU investors
and EU Member States (intra-EU arbitration), while allowing arbitration of
disputes between extra-EU investors and EU Member States (extra-EU
arbitration) to continue.
To understand whether these trade-offs pursued by the EU are pro-
arbitration, the further question then to ask is this: when and how should
arbitration be subordinated to extrinsic values?7 In this context, this short
essay begins by recalling the EU’s approach toward investor-State arbitration
(Section II), before considering what the EU’s approach can tell us about being
pro-arbitration (Section III).
II. EU LAW AND INVESTOR‐STATE ARBITRATION
The extrinsic consideration influencing the EU’s approach to investor-State

arbitration is the principle of autonomy of the EU legal system. Enshrined in
Article 344 of the Treaty on the Functioning of the European Union (TFEU), the
principle of autonomy prevents EU Member States from submitting a dispute
concerning the interpretation or application of EU law to any method of
settlement other than those provided for in the governing treaties of the EU.8
A key aspect of this principle is ensuring consistency in the interpretation and
application of EU law, for which the TFEU has devised a “preliminary ruling”
procedure. This procedure allows a “court or tribunal” of an EU Member State
to refer EU law questions to the Court of Justice of the European Union (CJEU)
for its opinion, thus ensuring that the CJEU remains the ultimate arbiter of EU
law questions.9
A. Intra‐EU Arbitration
In a series of rulings spanning the last four years, the CJEU has held that
intra-EU arbitration is incompatible with the principle of autonomy of the EU
legal order.
First, in its 2018 ruling in Achmea, the CJEU decided that the arbitration
provision of the Netherlands-Slovakia BIT is incompatible with EU law and
cannot be allowed to survive.10 Achmea’s starting point lay in the CJEU’s concern
that an arbitral tribunal deciding disputes under the Netherlands-Slovakia BIT
might interpret and/or apply EU law as EU law was part of the applicable law
6 Verhoosel, supra n. 5, p. 291.

7 Bermann, supra n. 1, p. 350.
8 Treaty on the Functioning of the European Union, OJ C115/1, 9 May 2008 (TFEU), Article 344.
9 TFEU, Article 267.
10 CJEU C-284/16, Slowakische Republik v. Achmea BV, 6 March 2018 (Achmea).
INSIGHTS FROM THE EU’S APPROACH TOWARDS INVESTOR-STATE ARBITRATION 49
under the BIT.11 In articulating this concern, the CJEU appeared to ignore
submissions—including from the referring German court—that the
underlying arbitration (Achmea v. Slovak Republic) did not, in fact, implicate
issues of EU law.12
The CJEU then held that a tribunal constituted under the Netherlands-
Slovakia BIT was incapable of ensuring the uniform interpretation and application
of EU law through a referral to the CJEU under the preliminary ruling procedure
as it was not a “court or tribunal of a Member State.”13
Finally, the CJEU expressed concern that even the domestic courts of EU
Member States would be unable to guarantee consistency at the stage of
enforcement or set-aside because their power to review the merits of arbitral
awards (assuming they had jurisdiction) was limited.14
This final limb of the CJEU’s ruling required it to identify a legally relevant
distinction between commercial arbitrations and investor-State arbitrations.
With respect to the former, the CJEU had previously found that the limited
scope for judicial review of arbitral awards by domestic courts of EU Member
States was unproblematic. The CJEU sought—as discussed below,
unpersuasively—to draw such a distinction by reference to the manner of
consent to such arbitrations, noting that commercial arbitration “originate[s]
in the freely expressed wishes of the parties” but investor-State arbitration
“derive[s] from a treaty by which Member States agree to remove from the
jurisdiction of their own courts disputes which may concern the application or
interpretation of EU law.”15
In 2021, the CJEU followed up with its ruling in Komstroy, concluding that
the ECT’s arbitration provision could also not apply to intra-EU disputes.16 The
CJEU’s substantive logic tracked verbatim its decision in Achmea. However,
two aspects of the decision stand out.
The first relates to the CJEU’s jurisdiction. The CJEU was asked to interpret
the meaning of “investment” under the ECT in the context of an arbitration
between exclusively non-EU parties. Despite this narrow scope of the reference
and the absence of any EU parties, the CJEU went on to decide whether intra-
EU ECT disputes could be referred to arbitration, considering it a “necessary”
antecedent question.17
The second relevant aspect concerns the dichotomy in the CJEU’s position
on arbitration of intra-EU ECT disputes and extra-EU ECT disputes. While
banning intra-EU ECT arbitration, the CJEU simultaneously appeared to uphold
11 Netherlands-Slovakia BIT, Article 8(6); Achmea, ¶¶ 40–42. See also, Achmea B.V. v. Slovak
Republic, PCA Case No. 2008-13, Award (7 December 2012), ¶ 276.

12 Achmea, ¶ 16.
13 Achmea, ¶¶ 39–49.
14 Achmea, ¶¶ 52–53.
15 Achmea, ¶ 55.
16 CJEU C-741/19, Republic of Moldova v. Komstroy LLC, 2 September 2021 (Komstroy).
17 Komstroy, ¶¶ 40–41.

arbitration of extra-EU ECT disputes18 without explaining why the latter was
acceptable even if it could similarly implicate issues of EU law.
Again in 2021, the CJEU issued a third ruling in PL Holdings, seemingly
striking down the possibility of ad-hoc referrals of investor-State disputes to
arbitration.19 The CJEU’s logic boiled down to the observation that what a Member
State is not permitted to do under an investment treaty, it should not be permitted
to do on an ad-hoc basis.
Amidst the CJEU’s rulings, 23 EU Member States entered into an agreement
to terminate intra-EU BITs, which entered into force on 29 August 2020.20
B. Extra‐EU Arbitration
While dismantling intra-EU arbitration, the EU has simultaneously allowed

non-EU tribunals to continue to adjudicate extra-EU investment disputes. The
EU’s recent trade agreements with Canada (CETA), Vietnam and Singapore, all
allow a non-EU tribunal to decide investment disputes. The CJEU has held that
these investment courts do not offend the principle of autonomy.
In its Opinion 1/17 of April 2019 regarding the CETA investment court’s
compatibility with EU autonomy, the CJEU accepted that the CETA court “will
be required… to examine the effect of [] EU measure[s]” that form the basis of
a Canadian investor’s challenge. However, the CJEU did not find this objectionable
primarily because, in its view, Article 8.31.2 of the CETA sufficiently protects
EU law’s autonomy by (a) requiring the CETA court to treat “the domestic law
of a Party as a matter of fact” and to “follow the prevailing interpretation given
to the domestic law by the courts or authorities of that party”; and (b) clarifying
that “any meaning given to domestic law by the Tribunal shall not be binding”
on EU courts.21
III. WHAT DOES IT MEAN TO BE PRO‐ARBITRATION?
Returning then to the question posed in the introduction: when, and how,
should trade-offs between arbitration and extrinsic values be made for them
to be seen as pro-arbitration? Looking at the EU’s contrasting approaches to
intra-EU and extra-EU arbitration, that question can be answered in at least
the following way: first, as to the when, a trade-off can be pro-arbitration if it
18 Komstroy, ¶ 65.
19 CJEU C-109/20, Republic of Poland v. PL Holdings Sàrl, 26 October 2021, ¶ 47 (“To allow
a Member State …. to submit that dispute to an arbitral body with the same characteristics as
the body referred to in an invalid arbitration clause contained in an international agreement …
by concluding an ad hoc arbitration agreement with the same content as that clause, would in
fact entail a circumvention of [its] obligations”).
20 Agreement for the termination of Bilateral Investment Treaties between the Member
States of the European Union, signed 5 May 2020, entered into force 29 August 2020.
21 CJEU Opinion 1/17, 30 April 2019, ¶¶ 120–136.
is a proportionate response to the extrinsic value; and second, as to the how,

a trade-off can be pro-arbitration when it is grounded in sound reasoning.
A. The When: Proportionate Subordination
If one takes as a starting point that some trade-offs need to be sought

between arbitration and extrinsic values, a trade-off would then be pro-
arbitration if it is proportionate. Put differently, being pro-arbitration would
entail finding a reasonable compromise between arbitration and extrinsic
values, and subordinating arbitration to the extrinsic value only to the extent
necessary.22 As mentioned in the introduction, this means adopting incremental
reforms where that would suffice to preserve a particular extrinsic value, and
resorting to invasive reforms only as the last resort.
The EU’s approach to intra-EU arbitration fails to meet this first proposition.
Juxtaposing the EU’s approach to intra-EU arbitration with its approach to
extra-EU arbitration, one queries whether the complete elimination of intra-
EU arbitration was the only way in which the EU could enforce the principle of
autonomy. EU lawyers might say that the CJEU had no other option. Indeed,
the CJEU has similarly found the jurisdiction of other non-EU tribunals—
including the European Court of Human Rights and the European Patents Court—
incompatible with the principle of autonomy because of the mere theoretical
possibility that those tribunals could interpret and apply EU law.23
Peeling the layers, however, reveals that the CJEU’s real concern appears
not so much to be the ability of non-EU tribunals to interpret and apply EU law,
but whether these tribunals can issue binding interpretations of EU law without
the possibility of oversight by the CJEU.24 And so, those non-EU tribunals that
can guarantee the CJEU’s binding oversight have been allowed to continue
dealing with matters of EU law. For example, the CJEU has found the dispute
resolution procedures under the European Common Aviation Area Agreement
unobjectionable, in part because the agreement safeguards the binding nature
of the CJEU’s rulings through access to the preliminary ruling procedure and
an express stipulation to treat the CJEU’s rulings as final and binding.25 Similarly
with the CETA court, the CJEU has allowed it to continue because the provisions
of the CETA expressly guarantee that the CETA court’s pronouncements on EU
law will be non-binding.
The CJEU’s rulings thus suggest that a compromise between intra-EU
arbitration and EU autonomy could have been achieved by similarly including
in BITs or the ECT an express guarantee that EU law determinations by arbitral
tribunals will not be binding on EU institutions. The EU’s willingness to
22 G Verhoosel, supra n. 5, p. 298.

23 See CJEU Opinion 2/13, 18 December 2014; CJEU Opinion 1/09, 8 March 2011.
24 See, e.g., CJEU Opinion 1/00, 18 April 2002, ¶ 12; CJEU Opinion 2/13, 18 December 2014,
¶ 184; CJEU Opinion 1/17, ¶¶ 70–73.

25 CJEU Opinion 1/00, ¶¶ 24–25.

negotiate those guarantees for extra-EU arbitration while insisting on wholesale

liquidating intra-EU arbitration makes it difficult to characterize the latter as
pro-arbitration.
B. The How: Subordination Through Sound Reasoning
This brings us to the “how” of seeking trade-offs between arbitration and

extrinsic values in a manner that is pro-arbitration. The EU’s approach—and
its reception in the wider legal community—highlights the importance of basing
any trade-off on sound reasoning. This section flags three examples of arguable
deficiencies in the CJEU’s logic to demonstrate how inadequate reasoning can
affect the perception of a trade-off as being pro-arbitration.
First, the CJEU rejected intra-EU arbitration en masse without considering
(i) whether intra-EU arbitrations necessarily implicate EU law, and (ii) whether
EU law is applied in those arbitrations as a matter of fact. As the previous
section notes, the CJEU’s approach is consistent with its prior jurisprudence of
treating even the theoretical possibility that a non-EU tribunal might engage
with EU law as problematic. However, without proper reasons for guarding its
jurisdiction against theoretical encroachments, the CJEU’s approach has been
considered controversial outside the EU’s judicial system. Indeed, investment
tribunals have declined to follow the CJEU’s rulings in part because the CJEU
did not appreciate that EU law might be applied only as a matter of fact, and that
there are intra-EU investor-State arbitrations that do not concern EU law.26
Second, the CJEU’s pithy rulings do not convincingly explain why intra-EU
arbitration deserves different treatment from extra-EU arbitration. As noted
in Section II, although the CJEU acknowledged in Komstroy that extra-EU ECT
arbitrations could similarly implicate EU law, it made no effort to explain why
that was acceptable where intra-EU ECT arbitration was not. Much in the same
way, the CJEU did not adequately explain its differential treatment of commercial
and investor-State arbitration, even though both might require an arbitral
tribunal to determine issues of EU law. The CJEU’s observation that commercial
arbitration “originates in the free will of the parties,” and is hence distinct from
investor-State arbitration, which derives from a treaty by which a Member
State agrees to exclude the jurisdiction of its own courts cannot sustain its
conclusion: the latter is of course as much a creature of consent as commercial
arbitration. In addition, why can Member States pass arbitration legislation to
limit their domestic court’s jurisdiction over matters referred to commercial
26 See, e.g., Eskosol S.p.A. in liquidazione v. Italian Republic, ICSID Case No. ARB/15/50,
Decision on Termination Request and Intra-EU Objection (7 May 2019), ¶ 123 (“an ECT tribunal
could [] consider EU law as a matter of fact” and “the Tribunal does not consider this case to
involve a challenge to any acts that Italy was required to take under applicable EU directives”);
Cube Infrastructure Fund SICAV and others v. Kingdom of Spain, ICSID Case No. ARB/15/20,
Decision on Jurisdiction, Liability and a Partial Decision on Quantum (19 February 2019), ¶ 160
(“Under the provisions concerning the applicable law that are binding on this Tribunal, Spanish
law and EU law are relevant only as facts”).
arbitration, yet cannot enter into treaties to allow arbitration of investor-State

disputes? Finally, if an arbitral tribunal said to be “originating in the free will
of the Parties” can interpret and apply EU law, why not the ad hoc referrals of
intra-EU disputes to arbitration, which the CJEU found problematic in PL
Holdings? Unsurprisingly, concerns have been raised regarding these
inadequacies in the CJEU’s reasoning.27
Third, the CJEU appeared to have gone out of its way in Komstroy to put an
end to intra-EU ECT arbitration. As described above, the question referred to the
CJEU in that case had nothing to do with the validity of intra-EU ECT arbitrations
and the underlying dispute did not even concern EU parties. Indeed, the CJEU’s
opinion on the validity of intra-EU ECT arbitration does not even feature in the
operative part of its ruling.28 As a result of this apparent overreach, the CJEU’s
opinion has not been well received so far. For instance, the tribunal in Sevilla
Beheer v. Spain has declined to apply Komstroy on the basis that the CJEU’s
ruling on the validity of intra-EU ECT arbitration was mere obiter dictum.29
IV. CONCLUSION
Just like Professor Bermann highlighted that trade-offs between

arbitration and extrinsic values are not to be regarded as anti-arbitration per
se, the EU’s approach to investor-State arbitration is a timely reminder that
such trade-offs will not be necessarily pro-arbitration either. As the authors
suggest here, whether a trade-off will be received as pro-arbitration may
depend on whether the trade-off is proportionate and whether it is grounded
in sound reasoning.
27 See, e.g., J Tropper, “From Achmea to Komstroy – The CJEU Strikes Back Against
Investment Arbitration under the Energy Charter Treaty”, Völkerrechtsblog (22 September
2021); Shearman & Sterling, “EU Court Undercuts Investment Protections in the Energy Charter
Treaty for Intra-EU Investors”, 13 September 2021; Debevoise & Plimpton, “The Future of
Investment Law in the EU: A Practical Perspective” (2021).
28 Komstroy, ¶ 87.
29 Sevilla Beheer BV and others v. Kingdom of Spain, ICSID Case No. ARB/16/27, Decision on
Jurisdiction, Liability and the Principles of Quantum (11 February 2022), ¶¶ 666–667.

Chapter 7
PRO-BERMANN
Robert H. Smit*
I love Professor Bermann’s “What Does it Mean to Be ‘Pro-Arbitration’?”

article. But I ask myself: is it pro-arbitration?
He tells our international arbitration community—heavily engaged as we
are both “by” and “in” international arbitration—that we have to make “trade-offs”
among our core values of legitimacy and efficiency in international arbitration.
How dare he. He tells us that we have to “compromise” our pro-arbitration zeal
to take into account policies “extrinsic” to international arbitration—stuff like
antitrust and securities policies that he claims also have “social value and
utility.” How dare he.
He dares because, of course, he’s right. Our international arbitration
community does need to think more deeply about, and view through a wider
lens, why and how we are pro-arbitration. If our pro-arbitration policy is
founded upon contract and respect for party autonomy—as the U.S. Supreme
Court has repeatedly instructed us—do we risk unmooring that policy from its
foundation when, in our pro-arbitration zeal, we treat arbitration agreements
as different and more than other contracts? For example, does it truly serve
international arbitration’s long-term interest and legitimacy when we construe
arbitration agreements more broadly than we do other contracts to require
non-signatories to arbitrate or to encompass disputes beyond those contemplated
by the parties? Is it really pro-arbitration, viewed through Professor Bermann’s
wider lens, to allow parties to avoid or water down, via arbitration agreements,
application of important U.S. public policies (such as those embodied in our
antitrust and securities statutes) that we do not allow parties to waive by
ordinary contract? In the same vein, is it pro-arbitration to allow parties to
waive, by arbitration agreement, the fundamental procedural protections
afforded by class action that we do not allow parties to waive in litigation by
ordinary contract?
Professor Bermann doesn’t offer answers to these questions in his article.
He offers much more: the occasion to ask these questions of ourselves, and the
wider analytical lens through which to answer them for ourselves in the pro-
arbitration interest of the long-term legitimacy of international arbitration. I
am most grateful for Professor Bermann’s article because, like so much of his
* Robert H. Smit is an Adjunct Professor of Law at Columbia Law School; Co Editor-in-Chief
of the American Review of International Arbitration (ARIA); and Chair of International

Arbitration Practice at Simpson Thacher & Bartlett LLP (retired).
55
scholarship, it has made me question and deepen my own thinking about some
of the most challenging and interesting issues in international arbitration.
It has been my great privilege and pleasure to collaborate with Professor
Bermann for over a decade now teaching courses on international arbitration
and litigation at Columbia Law School, and co-editing with him the American
Review of International Arbitration. He is the consummate gentleman, teacher,
and thought-leader, deeply concerned both about the various transnational law
subjects he teaches, as well as about the many U.S. and foreign students to whom
he teaches those subjects. We are all very fortunate to have Professor Bermann
guiding us—as professor, as reporter, as amicus, as international arbitrator, as
expert, as editor-in-chief, and more—with his gentle manner and keen analytical
insight into our international arbitration world.
Chapter 8
PROFESSOR GEORGE BERMANN: A PATHWAY TO
INTERNATIONAL ARBITRATION
Viren Mascarenhas*
Professor Bermann is a scholar with diverse academic interests. He is

widely associated at Columbia Law School with being one of the world’s
leading specialists in international arbitration, not only as an academic but also
as an arbitrator. This makes sense. He teaches several courses on international
commercial and investment arbitration, and is the Director of the Center for
International Commercial and Investment Arbitration at Columbia Law School.
But international arbitration is just one of his areas of specialty. He is also well-
regarded in the law of the European Union and transnational litigation.
Professor Bermann’s varied scholarship means that he does not view
international arbitration in isolation. His article, “What Does it Mean to Be ‘Pro-
Arbitration’?,” makes clear that one must assess the virtues and demerits of
international arbitration with reference to national and regional courts and
also wider public policy trends regarding whether international arbitration is
a suitable or appropriate form of resolution of certain types of disputes. When
doing so, one needs to investigate all of the various layers before making a
pronouncement that a particular jurisdiction is “pro-arbitration” or that
international arbitration is per se superior to counterpart litigation. Professor
Bermann invites—welcomes—the complexity of the inquiry of what it means
to be pro-arbitration even if it means that the conclusion is a classic “well, it
depends . . .”
For example, Professor Bermann is clear in his article that one needs to
distinguish between commercial and investment arbitration. He likely is
especially attuned to the attacks on investor-state dispute settlement (ISDS)
because some of the attacks are being waged by the European Commission and
are being given effect by the European Court of Justice, which decided in
Achmea that international arbitration clauses in intra-EU bilateral investment
treaties are incompatible with EU law. Professor Bermann is better able than
most to understand the trends within the European Union that led to this
decision because of his profound, decades-long study of the European Union
as both a legal and political entity. He is therefore able to take a step back and
explain why a jurisdiction may be pro-arbitration when it comes to commercial
arbitration but less so when it comes to investment arbitration.
* Viren Mascarenhas is a Partner at Milbank LLP; a Lecturer-in-law at Columbia Law School;
and Former student of Professor Bermann.

57
Similarly, Professor Bermann does not conclude that just because the courts
of a jurisdiction may play a role in arbitral proceedings means that the jurisdiction
is not pro-arbitration. He does not view options for judicial recourse as per se
anti-arbitration. He has published extensively not only on the role that national
courts may play during an arbitration and after its conclusion during
annulment and enforcement phases, but also at the very outset of an arbitration.
Some national systems might endorse positive Kompetenz-Kompetenz, which
recognizes the right of an arbitral tribunal to decide threshold issues but does
not deprive a court of the authority to do so at the pre-arbitration stage. Other
national systems might follow negative Kompetenz-Kompetenz, in which
courts play a minimal role in the pre-arbitration phase, and may opine on the
existence or enforceability of an arbitration agreement only after a tribunal
has rendered its award.
Other jurisdictions may adopt more nuanced positions. Professor Bermann
has surveyed and identified four “intermediate” approaches adopted by
jurisdictions all over the world. First, legal systems may show substantial respect
for party autonomy by allowing the parties to determine the proper role of
courts in deciding at the outset whether an arbitration agreement should be
given effect. Second, courts may address all challenges to enforcement of an
arbitration agreement at the outset, but the party resisting enforcement must
overcome a very substantial burden to prevail. Third, as set forth in Article 16(1)
of the UNCITRAL Model Law, the tribunal may decide the enforceability of the
agreement in the first instance, but this decision may be subject to immediate
judicial review within a short period. Fourth, courts could distinguish among
the possible objections to enforcement of an arbitration agreement, determining
which are worthy of judicial decision prior to arbitration.
Professor Bermann does not summarily conclude that choosing any of
these options per se means a jurisdiction is more pro-arbitration than others
that make different choices. Rather, he grapples with the policy choices
underlying each option, and the extent to which national laws and decisions of
national courts reflect and implement those policy choices. Only after
completing this holistic analysis would he make pronouncements about whether
a jurisdiction may be considered more pro-arbitration than others. And the
answer may still be “well, it depends . . .”
Professor Bermann probably has taught thousands of students at Columbia
Law School (not to mention students at other law schools where he has been a
visiting professor). His students are taught not to accept the virtues of
international arbitration as “givens” even if they have signed up for courses
about international arbitration. The point is not to be pro-arbitration just for
the sake of it, even if a student is seeking a lifelong career in international
arbitration. Rather, it is to be critically rigorous always, welcoming complexity
and ambiguity even though they may get in the way of reaching satisfying—
but, likely, shallow—conclusions.
PROFESSOR GEORGE BERMANN: A PATHWAY TO INT’L ARBITRATION 59
Where Professor Bermann is unreservedly pro-arbitration is serving as a

pathway to careers in international arbitration for many, many of his students.
He engages students as his research assistants to develop their knowledge of
the field. He holds extensive office hours so that students have access to him
and his expertise. He hosts and speaks at dozens of international arbitrations
events all over the world (and virtually during the pandemic), where he is
hounded by students who are keen to learn more from him. He connects
current students with former students who already are in the field. And, more
generally, he leans on his extensive network to find opportunities in international
arbitration for current students. When it comes to engagement with his students
and their careers, he is 100% pro-arbitration. I speak from experience as I
benefited directly from him in this regard.
PART II
Former Students in
International Arbitration
Chapter 9
SECURING INTERNATIONAL ARBITRATION’S
DOMESTIC FOUNDATIONS
Adam J. DiClemente*
International commercial arbitration is an essential tool for operating the

twenty-first century economy. Though not beyond threat, the field, and its
position in the international order, is established. And, while the authorization
and power for international arbitration, quite necessarily, derives from its
continuing integration into private contractual agreements, it is not fairly
described as a purely private enterprise. International arbitration is governed
by a developed body of rules, standards, and practices that are both mandated
by standing arbitration organizations and voluntarily adopted by its practitioners.
Moreover, widespread governmental assent to the New York Convention, and
its attendant adoption into domestic law, has created a relatively stable
transnational disputes resolution platform. All of this is to say that, within the
world of commercial entities doing business across borders—and the law
firms and other professionals who serve them—arbitration is not controversial.
Indeed, where cross-border interests are at issue, it is a well-welcomed default,
providing certainty for governance and enforcement where there would
otherwise be none.
But the universe of legal disputes extends far beyond this primary audience
for international arbitration. Indeed, it may be easy for practitioners focused
on international arbitration in the United States to occasionally overlook that
most disputes are decidedly local. In 2018, the United States Federal Judiciary
reported 277,010 new civil case initiations. See U.S. Courts, Federal Judicial
Caseload Statistics 2018, available at https://www.uscourts.gov/statistics-
reports/federal-judicial-caseload-statistics-2018 (last accessed March 18,
2022). And, more significantly to the point, data collected by the National
Center for State Court’s Courts Statistics Project, revealed that parties initiated
16.4 million civil cases across the fifty state court systems in 2018. Of these
state court initiations, 47% sounded in contract and 17% concerned “small
claims.” See National Center for State Courts, State Court Caseload Digest 2018
Data, available at https://www.courtstatistics.org/__data/assets/pdf_file/0014/
40820/2018-Digest.pdf (last accessed March 18, 2022).
In this broader universe of legal disputes, arbitration is not a default. And,
when set against the traditional availability of state-sanctioned, state-enforced,
* Adam J. DiClemente is currently an Associate at Quinn Emanuel Urquhart & Sullivan, LLP.
A 2013 graduate of Columbia Law School, he studied under Professor Bermann and served as
the Executive Editor of the Columbia Journal of Transnational Law, Volume 51 (2012–13).
63
public, forums for dispute resolution—that is, the courts—arbitration is more

controversial. This comment does not focus on the detail or validity of concerns
regarding the fairness of domestic arbitration, but it cannot be denied that such
concerns exist and are persistent. For example, in March 2022, the House of
Representatives passed a broad bill—dubbed the Forced Arbitration Injustice
Repeal (FAIR) Act—that, if enacted, would largely nullify pre-dispute consumer
and employment arbitration provisions. See Daniel Wiessner, Reuters, House
passes bill to end mandatory arbitration of legal disputes, Mar. 17, 2022,
available at https://www.reuters.com/legal/transactional/house-passes-bill-
end-mandatory-arbitration-legal-disputes-2022-03-17/ (last accessed March
18, 2022). As such, within the large set of civil legal claims where arbitration
might be a useful method of dispute resolution, it often meets skepticism and,
perhaps, disfavor.
The difference between arbitration’s position in the international and
domestic spheres is not without consequence. Domestic systems of national
(and state) law are the backbone of the international system; enforcement of
agreements to arbitrate, recognition of foreign awards, and reduction to
executable domestic judgements are almost exclusively governed at the national
and local levels. The two systems are firmly linked. The relative “pro-
arbitration” merits of rules, policies, or approaches adopted in the international
sphere could easily be outweighed by a faltering domestic framework—especially
here in the United States as signified by Congress’s recent consideration of
measures invalidating innumerable arbitration agreements. To ensure
international arbitration’s continuing success, attention must be paid to the
structures of domestic arbitration—including popular support and understanding
of arbitration’s value. For international arbitration to continue its current
position, attention must be paid to securing its domestic foundations.
Against this background, and focusing on the United States, this comment
briefly addresses two concepts, and posits ideas for consideration, that may
bolster legitimacy and support for arbitration as a dispute resolution tool on
the domestic front. First, state legislatures should exercise their powers to
establish and structure “arbitration courts” in which civil litigants can opt-in
to an arbitral dispute resolution system absent (or in place of) a pre-existing
contractual obligation to arbitrate. Second, legislatures, and especially the
federal legislature, should work toward codifying the large body of judge-made
law that defines the practice of arbitration in the United States. Neither is a
“simple” process, to be sure. But each, hopefully, goes to a root issue driving
distrust and potential dismantling of arbitration—the perception that it
primarily serves interests other than those of the general public.
SECURING INTERNATIONAL ARBITRATION’S DOMESTIC FOUNDATIONS 65
I. CREATE “ARBITRATION COURTS” TO EXPAND USE OF ARBITRAL

DISPUTE RESOLUTION
As noted above, most civil disputes in the United States arise in the state and
local courts. These judicial systems are subject to the control of state legislatures
which, for the most part pursuant to the state and federal constitutions, have
plenary power to create courts of general or specialized subject matter
jurisdiction. For example, most states have designated “small claims” courts to
address property, tort, and contract disputes below a certain monetary
threshold. This power, used creatively to create a “court” with subject matter
jurisdiction to oversee arbitration, could be a boon for expanding use of the
tool to assist in the resolution of the more than 16 million civil cases filed
annually across the states. Not only would this bring more parties into contact
with arbitration—increasing trust and understanding of its processes, as
discussed below—but it would help alleviate burdens on judicial caseloads as
they presently exist.
While the details of any such system surely cannot be fleshed out in the
space afforded here, the purposes and essential functions of the approach are
readily identified.
First, concordant with the underlying purposes of arbitration itself, the
primary purpose of this system must be to promote efficient and fair dispute
resolution. The secondary purpose—albeit primary in the context of this
comment—is to demystify and de-stigmatize arbitration in the domestic sphere.
Outside the world of bespoke contracts and agreements defining the international
sphere, most arbitration is triggered by ex ante dispute resolution boilerplate
contained within contracts of adhesion. Because of this, whereas a seasoned
practitioner or scholar can invoke the theoretical underpinnings of contract as
a reflection of “party autonomy” and “market choice,” the average party required
to arbitrate under such a provision is likely to say simply that they “were
forced to arbitrate.” That is no ringing endorsement. A system of “arbitration
courts” wherein disputing parties can more easily elect to use arbitration after
a dispute materializes, irrespective of pre-existing obligation to do so, can and
will, over time, shift public discourse and perceptions of the tool. Raising
arbitration to the level of a “court” and, as described next, allowing parties to
opt into arbitration outside the pressures of contracting, could go a long way
toward de-stigmatization.
Second, the method and functionality of these “courts” could be as varied
and creative as the fifty-state court systems’ approaches to the traditional
judicial function. There are several principles that could define the approach.
At the outset, arbitration must remain a system defined by private choice to
use it—no party should be permitted, absent a contractual agreement (for which
the body of law is already well established), to force an adversary to engage in
arbitration. Rather, “arbitration courts” should be structured to “nudge,” with
the enabling law creating incentives for parties to agree to its use. For example,
states could create a system permitting a plaintiff/claimant to publicly file a

bare-bones demand for arbitration instead of a complaint and seeking, as a
part of “service of process” or its equivalent, the defendant/respondent’s consent
to arbitrate pursuant to a set of rules the state’s new law would establish or
adopt. If such consent is given, then the defendant/respondent would receive
some form of benefit, including, for example, a mandate in the rules that
disclosures be limited to a certain volume or timeframe (reducing costs compared
to litigation), and a rule that the statement of claim (akin to a complaint) is not
filed on the public “arbitration court” docket, but only provided within the
confines of the arbitration proceeding itself (reducing reputational harm and
public information regarding the dispute.) After receiving a defendant/
respondent’s consent, the role of the judge in this “arbitration court” would be
limited to ensuring the matter is transferred to an arbitrator for further
proceedings pursuant to the rules. If consent is not given, then the matter
would revert to the judge who would then be responsible for managing the
transfer of the matter to the appropriate court in which it could have been filed
in the first instance. The law could be structured to toll the statutes of
limitation upon filing of the demand, creating incentives for a plaintiff to take
this approach in the first place. And the law could further provide that, if a non-
consenting defendant is not the prevailing party in the subsequent litigation,
certain fees are shifted and payable by the defendant to the prevailing plaintiff,
or even a public fund for paying arbitrator fees as a ‘trust” to support the
enterprise (the amount, nature, and calculation of these fees, of course, being
appropriate grounds for legislative public policy debate).
It is already true that parties can elect to arbitrate a dispute at any time—
even absent creation of new “courts” for that purpose. But this is not a frequent
occurrence, and the approach suggested here is designed to change that,
creating incentives and opportunities for parties to consider voluntary arbitration
on equal footing with initiating a civil litigation when a dispute first arises.
Third, as part of the statutory framework enabling “arbitration courts,”
legislatures have the opportunity to create and adopt rules to govern the
arbitrations taking place under those courts’ jurisdiction. On the one hand, this
could be as simple as adopting a generic version of the American Arbitration
Association’s rules, which, like many other organizations, have proven
functional and not particularly controversial for decades. On the other hand,
this could be an opportunity for state legislatures to create bespoke rules for
arbitration practice, perhaps hewing somewhat closer to traditional litigation
approaches as a means to further incentivize parties to opt-into this system.
Fourth, the creation of an “arbitration court” system will provide an
opportunity to expand the community of arbitrators. As indicated above, the
role of state-system judges in the proposed arbitration courts will necessarily
be a limited one, essentially inhabiting the part of case administrator for
potential arbitration matters. If the incentives provided by the arbitration
court system and the rules adopted to govern arbitrations initiated thereunder
SECURING INTERNATIONAL ARBITRATION’S DOMESTIC FOUNDATIONS 67
actually increase public adoption of arbitration (as this comment anticipates

they would), the roster of attorneys and other professionals offering to sit as
arbitrator must also expand. This too provides an opportunity to build public
trust in arbitration as an institution. States, bar associations, law schools, and
civil society organizations could provide training and education for new
arbitrators, ensuring quality service and helping eliminate the “black box”
notion that arbitrators rule by whim without consideration of the governing
law and applicable facts. And, through this, the strong body of rules and
approaches pioneered in the international arbitration sphere are sure to find
their way into best practices and training.
Last, states may consider vesting the judges of these “arbitration courts”
with automatic jurisdiction over motions to enforce or set aside awards arising
from arbitrations initiated under its auspices. While it will be critical to avoid
turning the court into any form of de novo “appeal by right” from the arbitrator’s
decision—negating any gains in efficiency and undermining a fundamental
purpose of arbitration—providing a built-in, automatic path to judicial next-
steps (rather than the current process of filing a new case to confirm, set aside,
or enforce) is likely to increase trust in the arbitration process. For example,
state legislatures could establish that the arbitration courts retain jurisdiction
over the case created by filing the initial demand up through, and until, the
award is satisfied. This approach could also simplify the process for receiving
judicial assistance in aid of the arbitration for disclosures, subpoenas, or other
matters requiring state-power for enforcement. Again, these are not tools
which are currently unavailable to arbitrating parties, but they are tools that
require firm knowledge of the, frankly complex, interplay between arbitration
rules, state court jurisdiction, arbitration law of the state (lex arbitri), and the
statutes governing enforcement of awards. Creating a “court” with statutory
authority to bring these issues under one roof is surely a means of increasing
public trust, understanding, and use of the arbitration system.
Ultimately, direct and increased engagement with arbitration as a
standardized dispute resolution tool—especially outside the specter of “forced
arbitration” that seems to have given rise to the FAIR Act, and other historical
efforts to nullify arbitration in alleged support of the public good—is essential
for continued growth and success in the field. Ensuring local, relatively small-
scale use of arbitration is a central consideration for sustaining the robust
practice of international arbitration.
II. WORK TO CODIFY JUDGE-MADE ARBITRATION DOCTRINES
The Federal Arbitration Act (FAA) is terse. Because of this, and because
arbitration has grown into a robust, frequently-used tool over the almost 100
years since the Act’s primary text was drafted (1925), most of what the act
means and requires is a function of judicial interpretation. Significant judicial
doctrines defining the field of arbitration arise from a handful of words in a
handful of FAA provisions. For example, while the boundaries of Kompetenz-

Kompetenz and the division of power between courts and arbitrators
regarding the scope of an arbitration agreement surely root in the text of the
FAA, the defining rules for these critical issues are found entirely within the
Supreme Court Reporter. This issue, and others in the field such as availability
of mass arbitrations and the subject matter arbitrability of certain bodies of
law, are matters of public concern; they go directly to the role of the judiciary
and its function as a public service. But Congress has been content to leave
these issues with the Supreme Court. On the one hand, the refusal to abrogate
the Court’s decisions by amending the statutes is an acceptance, in passing, of
the Court’s choices. But, on the other hand, it does not provide an affirmative
endorsement of the law, passing it through the representative legislative
process that—in principle—ensures that the law reflects public will. Congress
should not be afraid to evaluate and codify the significant body of judge-made
arbitration law. Work over the last decade on the Restatement of Arbitration,
among other projects and treatises, demonstrates that the principles have been
well-enough defined that they can be stated independent of the fact pattern
inhering in a particular case. And, while practitioners may fear (perhaps rightly)
that legislative involvement could throw a wrench into a system that otherwise
works well, that perspective does not account for the “pro-arbitration” need to
ensure that the public is an active participant, and endorser, of arbitration. For
better or worse, the public weighs in through the legislature.
* * *
Practitioners of international arbitration must be advocates for improving

arbitration at all levels. They must work to make all arbitration process more
fair, just, and free from potential abuse. Absent trust and robust use of
arbitration in the domestic sphere, the foundations supporting international
arbitration are at risk. A policy is “pro-arbitration” not just when it improves
the existing procedures used in international arbitration, but when it serves to
improve public support of arbitration which is, ultimately, the field’s bedrock.
Chapter 10
A REFLECTION ON BG GROUP V. ARGENTINA, IN
FIVE ACTS
Alexander A. Yanos*
Act I: I met Professor Bermann in September 1992 while I was a student

in his very popular and well-attended course on transnational litigation and
arbitration at Columbia Law School. For aspiring international lawyers (of
whom I was one), the course was de rigueur. What impressed me the most about
the class at the time was that it carefully went through the thorny problems of
choice of law, choice of forum, and who decides arbitrability—presenting the
problems and noting the multiplicity of answers that different courts across
the United States and around the world. It was a spectacular introduction to
the problems that informed my early career and I kept his course materials
close by my side for years after graduation.
Act II: Twenty years later, I faced one of my worst nightmares as a
practitioner and Professor Bermann came to rescue. As a prelude to this story,
I was the lead counsel for the BG Group, PLC, in its investment dispute against
Argentina. During the arbitration, which involved an eight-day hearing and
several rounds of written submissions, witness statements, and expert reports
over the span of more than four years, Argentina argued that the arbitrators
lacked jurisdiction because, among others, BG Group initiated arbitration without
first litigating its claims in Argentina’s courts, despite the local litigation
requirement under Article 8 of the UK-Argentina Bilateral Investment Treaty
(UK-Argentina BIT). BG Group PLC. v. Republic of Argentina, UNCITRAL, Award
(Dec. 24, 2007). In Argentina’s view, the “failure by BG to bring its grievance
to Argentine courts for 18 months renders its claims in this arbitration
inadmissible.” Rejecting this argument, the arbitration determined that it had
“jurisdiction” to consider the merits of the dispute. In support of that
determination, the tribunal concluded that Argentina’s own conduct had waived,
or excused, BG Group’s failure to comply with the local litigation requirement.
BG Group ultimately prevailed in the arbitration, and was awarded US$185.3
million.
Subsequently, the District Court for the District of Columbia decided to
confirm the award and reject Argentina’s motion to vacate it. However, in a
twist of events, on January 17, 2012, the United States Court of Appeals for the
District of Columbia Circuit (D.C. Circuit) reversed the District Court for the
District of Columbia’s decision. In reaching that decision, the D.C. Circuit
* Alexander A. Yanos is a Graduate of Columbia Law School (Class of 1993) and now a
Partner and Co-leader of Alston & Bird’s International Arbitration & Dispute Resolution Team.
69
reasoned that BG Group must “commence a lawsuit in Argentina’s courts and

wait eighteen months before filing for arbitration” pursuant to the UK-Argentina
Bilateral Investment Treaty (UK-Argentina BIT). Although the Tribunal had
concluded that BG Group’s failure to satisfy this condition was excused given
the circumstances the BG Group faced in Argentina, the D.C. Circuit concluded
that the fulfillment of such a condition was a question for a court to decide and
that BG Group was not excused by the circumstances. Because BG Group had
not taken the dispute to Argentine courts, the D.C. Circuit ordered the award
vacated.
The specter of losing and having to tell BG Group to go back to Argentine
courts before filing another request for arbitration was further heightened by
the D.C. Circuit’s denial of BG Group’s petition for panel rehearing or rehearing
en banc. Given these circumstances, the only recourse available to my client
was the Supreme Court of the United States (Supreme Court). Although I
believed in the merits of our case, I was very pessimistic since the percentage
of cases being adjudicated by the Supreme Court is less than five percent each
year.
Of course, in this crisis, one of my first calls was to the man who taught me
arbitrability law. Professor Bermann agreed that the case was wrongly decided.
He comforted me by saying that “justice will prevail.” But he did not just stop
there. In support of BG Group’s petition for a writ of certiorari, he actually put
the laboring oar in the Amicus Brief of Professors and Practitioners of Arbitration
Law. This support was critical as it decidedly increased our chances of having
the petition for a writ of certiorari granted.
Act III: Initially, the Supreme Court neither granted nor denied our petition.
Instead, the court called for the views of the Solicitor General. Remarkably, the
Solicitor General recommended the court deny our petition for a writ of
certiorari—but the Supreme Court, partly on the strength of Professor Bermann’s
amicus brief, rejected that advice and granted us the writ! Professor Bermann
once again took the lead in the Amicus Brief of Professors and Practitioners of
Arbitration Law in Support of Reversal (Professor Bermann’s Amicus Brief).
Professor Bermann is an international arbitration scholar who deeply cares
about institutional design and legitimacy. Although he acknowledges the need
to maintain arbitration as an effective and therefore attractive alternative to
litigation due to the advantages that arbitration offers (e.g., speed, economy,
informality, technical expertise, and avoidance of national fora), he still believes
that national courts play an “important policing role” in helping arbitrators
render awards “that withstand judicial challenge and otherwise enjoy legitimacy.”
George A. Bermann, The “Gateway” Problem in International Commercial
Arbitration, 37 YALE J. INT’L. 1, 2 (2012).
His view on the allocation of tasks between courts and tribunals is guided
by a healthy balance of consistent principles and a sense of pragmatism.
Unsurprisingly, Professor Bermann’s Amicus Brief advocates for a careful and
balanced view on the question who—court or arbitrator—bears primary
A REFLECTION ON BG GROUP V. ARGENTINA, IN FIVE ACTS 71
responsibility for interpreting and applying the local litigation requirement

under the UK-Argentina BIT to an underlying controversy. In support of the
reversal, and from an institutional design standpoint, the brief thoroughly
explains why sovereign parties to BITs typically expect pre-conditions to
arbitration to be adjudicated by arbitrators with expertise in public international
law and are accustomed to treaty interpretation in accordance with the Vienna
Convention on the Law of Treaties. The brief further notes that the parties’
intent to submit threshold questions to arbitrators is further reflected by the
UK-Argentina BIT’s provision incorporating the UNCITRAL Rules the default
choice for instituting an investor-state arbitration.
From a policy perspective, the brief notes that affirming the D.C. Circuit’s
decision would change the trajectory of case law on the distinctions between
substantive and procedural “arbitrability” in the determination of threshold
issues in commercial arbitration as discussed in Howsam v. Dean Witter
Reynolds, Inc., which sets out distinction between whether an objection to
arbitration calls into question the existence or validity of an arbitration
agreement, on the one hand, or features of the arbitral process, on the other.
537 U.S. 79 (2002).
The former is referred to as raising issues of substantive arbitrability—the
threshold objection strikes at the very core of the legitimacy of arbitration, namely
consent, and is presumptively, for the courts to decide. In the latter situation,
however, the objection involves differences over when and how the arbitral
process should unfold. A failure to satisfy a condition precedent is one of them.
Other examples include: (i) a claim is time barred; (ii) a claim is barred by res
judicata; or (iii) the claimant waived its right arbitrate. Professor Bermann’s
Amicus Brief argues that reserving these types of objections for arbitrators
helps ensure the efficiency of arbitral proceedings in the United States, without
detriment to their legitimacy. And because BITs and commercial agreements
often impose steps in which a claimant must undergo before resorting to
arbitration, the D.C. Circuit’s decision could influence the field of commercial
arbitration as well.
Most importantly, from a pro-arbitration perspective, the brief argues that
the effectiveness of international arbitration as a means of resolving disputes
pursuant to investment treaties would be impaired if national courts were to
interpret such treaties as implicitly allowing them to review de novo arbitrators’
rulings on threshold issues simply because the parties (or the tribunal) chose
to hold the arbitration in their jurisdiction.
Act IV: On December 2, 2013, after both parties and the amici submitted
their briefs, the Supreme Court held the oral argument round for BG Group.
The stakes were very high, and I was feeling quite nervous. However, as I saw
Professor Bermann taking his seat, which had been reserved for him by Justice
Ginsburg, I felt calmer.
Act V: In the end, Professor Bermann was right: Justice did prevail. On
March 5, 2014, in a 7–2 decision, the Supreme Court ruled in favor of BG Group,
reversing the D.C. Circuit’s decision. I felt utterly relieved. Significantly, Justice
Breyer, writing for the majority, endorsed Professor Bermann’s view. The court
agreed that the local litigation requirement “functions as a purely procedural
precondition to arbitrate.” In support of this pro-arbitration view, and citing to
Professor Bermann’s Amicus Brief, the court noted that “to assume the parties
intended de novo review of the provision by a court ‘is likely to set United
States courts on a collision course with the international regime embodied in
thousands of [bilateral investment treaties].’” BG Group plc v. Republic of Arg.,
572 U.S. 25, 43.
Professor Bermann is a scholar, a gentleman, and a true friend.
Chapter 11
BEING PRO‐ARBITRATION IN ANTI‐
ARBITRATION SITUATIONS
Alexander Grimm*
Professor Bermann’s 2018 article titled “What Does it Mean to Be ‘Pro-

Arbitration’” elegantly describes the multiplicity of definitions of what pro-
arbitration is, emphasising that there is no exhaustive list of pro-arbitration
attributes. He further elaborates on the trade-offs that necessarily arise
between different pro-arbitration aspects; and underlines the importance of
values that are extrinsic to arbitration, such as broader legal rules or social
norms. These general, broader considerations determine arbitration’s legitimacy
in society and are particularly relevant.
The former is of particular interest for this brief essay. Society and the law,
in general, shape the political and legal framework in which arbitration operates.
This framework can define what is generally accepted more narrowly or wider,
and thereby decides whether arbitration has the necessary leeway to flourish.
Arbitration has profited from tremendous support by states and stakeholders
in the past, considering, for instance, that virtually every state has ratified the
New York Convention, a great majority of states are contracting states to ICSID
(despite recent withdrawals), and many states build on the UNCITRAL Model
Law for their lex arbitri. It therefore could develop relatively freely. In the last
years, however, arbitration had to defend itself before the general public and
before courts and in some instances lost ground. If external stakeholders may
be perceived as ‘anti-arbitration’ the question becomes how the pro-arbitration
community can respond to the concerns raised.
The following briefly sketches out the relative (un-)importance of pro and
anti-arbitration considerations. First, it will exemplify what it means to support
arbitration’s legitimacy on a policy level if stakeholders are anti-arbitration
(I.). In a second step it will look at the arbitration practice of tribunals and
courts to show that pro-arbitration concerns play a smaller role there when
facing anti-arbitration situations (II.).
* Alexander Grimm is a Principal Associate at Freshfields Bruckhaus Deringer in Frankfurt
am Main (Germany) and a member of the firm’s international arbitration group. Before joining
the firm as an associate, Alexander was an intern at the Permanent Court of Arbitration in The
Hague and the International Chamber of Commerce in Paris. He is a member of the bar in
Frankfurt (Germany) and New York. He holds an LLM from Columbia Law School (where he also
worked for Professor Bermann) and from Martin-Luther University (Germany), and a PhD from
the University of Bonn.
73
I. ARBITRATION’S LEGITIMACY ON A POLICY LEVEL IF

STAKEHOLDERS ARE ANTI‐ARBITRATION
Policy considerations can be voiced in different ways. Most obviously, a

legislator may discuss in public and then ultimately enact an amendment to
the lex arbitri. While some states may create or change their law in a way that
could be seen as limiting arbitration, most states still allow for arbitration and
give it considerable freedom to develop. But also general discussions, which
may be steered by NGOs or other interested parties, can have a considerable
impact on the general public’s perception of arbitration and may eventually
impact the law. For instance, a public discussion mainly in Europe on the
legitimacy of investor-state arbitration was instigated by the negotiations of a
trade agreement between the EU and the USA (TTIP)—which eventually failed.
This discussion gave rise to the European Commission’s concept of a Multilateral
Investment Court in 2015, which is supposed to replace arbitration. It is included
as a dispute resolution mechanism for investor-state disputes in CETA and the
EU-Vietnam Free Trade Agreement. Further, also UNCITRAL Working Group III
discusses a “standing multilateral mechanism” as a reform option for investor-
state dispute settlement.
The discussion about investor-state arbitration’s legitimacy is arguably the
most prominent and obvious example of a policy discussion between an anti-
arbitration and a pro-arbitration camp. Arbitration supporters in Europe
attempted to convince the general public and the relevant public institutions
that investor-state arbitration is legitimate. Some may say they lost the debate,
at least in the eyes of the policy makers in Brussels. But the discussions in the
UNCITRAL Working Group III and the openness for arbitration in other
investment treaties (such as the USMCA or the CPTPP) show that this debate is
not lost but ongoing. Investor-state arbitration can only flourish if stakeholders–
including the general public–are not fundamentally opposed to it. Arbitration
must be the most convincing method to resolve disputes. This means that it must
be better than its alternatives, such as dispute resolution before local courts,
regional or international courts, multilateral courts, or via mediation. Arbitration
must adapt and become more convincing, and it must do so publicly. The adoption
of the UNCITRAL Transparency Rules and the relatively open discussions in
UNCITRAL Working Group III are good examples of a sincere attempt to
improve investor-state arbitration.
However, even considerable changes to the law of investor-state arbitration
(and for each of these (proposed) changes it can be discussed whether it is pro-
arbitration or not) may not assuage every concern. The discussion on investor-
state arbitration’s legitimacy is also based on ‘soft’ issues or rather perceptions
that are hard to overcome by changes of the law only. If stakeholders are generally
opposed to the idea that a state is made accountable before an international
tribunal and compelled to pay damages to a foreign investor, the pro-arbitration
camp needs to frame arbitration in the public as the better (or best) dispute
BEING PRO-ARBITRATION IN ANTI-ARBITRATION SITUATIONS 75
resolution mechanism by explaining its values and legitimacy. One may not
convince everyone, but potentially a majority, that arbitration is the fairer and
more reasonable dispute resolution mechanism to both, the host-state and the
investor, compared to the alternatives. Arbitration must be “sold” or “pitched”
to the stakeholders, which is more than changing the black letters of the law.
A somewhat comparable debate between an anti-arbitration and a pro-
arbitration group relates to the question if and when consumers should be
bound to arbitrating disputes with businesses. This is in general possible in the
U.S., where the “Arbitration Fairness Act”—as predicted by Professor Bermann
in his 2018 article—did not come to pass. In contrast, arbitration clauses in
consumer contracts are closely scrutinised in Europe (due to an EU directive
on standard contract terms). They are not automatically invalid, but the courts
closely assess whether the consumer is unduly disadvantaged by a given
arbitration procedure. The legal limits of what is allowed or not are relatively
uncertain. This is one reason why consumer-business arbitrations play a much
smaller role in Europe than in the U.S. From a European perspective, it would
probably be very difficult to convince stakeholders that arbitration would be a
fair and reasonable dispute settlement mechanism for such consumer disputes.
If one wanted to change that stance, it would need a specifically adapted
arbitration law addressing the issues that consumers face in arbitrations with
businesses (and the US may serve to showcase that). Specifically in the field of
consumer disputes, arbitration would likely need to make some significant
adaptations. But this is in general tenable given that arbitration–just like pottery
clay–can be formed with imagination, stable hands, precision and patience to cater
to the needs of a specific field. As shown by Professor Bermann in his 2018
article, given the trade-offs between pro-arbitration attributes and the need to
consider also other (potentially anti-arbitration) interests, it is hard to agree
on rules that convince the parties involved in the disputes to use arbitration.
Even if that is feasible—which in general it is—, it would need more than that.
Even the best consumer- and business-friendly arbitration law (which some
may already perceive as unfeasible) would also need to convince the European
legislator(s) that arbitration provides a legitimate dispute resolution option to
consumers despite their weaker position compared to businesses.
As with investor-state arbitration, this is only possible if one can explain to
an “arbitration outsider” that arbitration is the better dispute resolution
mechanism for all parties involved compared to the alternatives. That is more
than merely amending the arbitration law. Being pro-arbitration hence can mean
to consider and potentially adapt to general policy considerations (which can
be based on perception rather than facts), including anti-arbitration policies.
Besides these policy considerations by a (local or international) legislator
or policy maker, policy in a broader sense is also “made” by court decisions,
particularly by the highest courts in a state or region. Most famously in Europe,
the Court of Justice of the European Union (CJEU) has decided that arbitration
clauses in investment treaties between two EU Member States are invalid
(C-284/16, Achmea). It has extended that perceivable anti-arbitration stance

recently to intra-EU disputes arising under the Energy Charter Treaty (C-741/19,
Komstroy) and to ad hoc arbitration agreements between an EU host state and
a foreign EU investor (C-109/20, PL Holding—notably, Professor Bermann
chaired the underlying SCC arbitration).
It would be very difficult to change the CJEU’s policy against intra-EU investor-
state arbitrations. The main reason is that any pro-arbitration argument would
probably not convince the CJEU to change its case law. This is so because its
decisions against intra-EU investment arbitration are only indirectly anti-
arbitration. The CJEU’s reasoning is primarily rooted in the peculiarities of EU
law. The CJEU appears to be trapped in its position that it must be the sole
gatekeeper of a final and authoritative interpretation of EU law in order to
ensure (to the extent possible) that EU law is uniformly interpreted and applied
in every EU Member State. For arbitration matters specifically, this is exacerbated
by several factors, including (i) the CJEU’s confirmation of its legacy case law
that an arbitral tribunal cannot seek a preliminary judgment by the CJEU on the
interpretation of EU law (thus, confirming case 102/81, Nordsee and C-195/09,
Miles and Others), (ii) the CJEU not appreciating—and in fact dismissing—that
the EU law could be uniformly enforced in the EU by virtue of local courts seeking
a preliminary decision by the CJEU when asked to vacate or enforce an award
(at least for non-ICSID cases), (iii) its wide interpretation of what constitutes a
(potential) application of EU law by arbitral tribunals, and (iv) not accepting
that its grasp of a uniform interpretation and enforcement of EU law has its
natural limits. The decisions by the CJEU, precisely because they are not geared
against investment arbitration as such but are rather based on general aspects
of EU law, have also instigated the fear that the court may extend its view to
international commercial arbitration. This, however, appears unlikely given its
case law acknowledging the concept of international commercial arbitration (in
Achmea, the CJEU even references these cases expressly, including the famous
Eco Swiss decision).
Thus, despite the CJEU case law being perceived as anti-investment
arbitration, any discussion on the CJEU’s legal position cannot be “won” by arguing
with pro-arbitration ideas. Being pro-arbitration rather means to address the
CJEU’s specific non-arbitration EU law concerns. Even then, although the CJEU
is more likely to listen to such a discussion, at least at the moment, it appears
fairly unlikely that the court would change its case law.
II. ARBITRATION LEGITIMACY’S ROLE IN TRIBUNAL AND COURT

DECISIONS
While the above describes anti-arbitration policies by legislators, (highest

local or regional) courts or general policy makers, the following will briefly
discuss to what extent pro- and anti-arbitration concerns—and hence arbitration
legitimacy—play a role when an arbitral tribunal or (local) court renders a
decision in a specific case. The obvious difference to the general (arbitration)

policy is that the tribunal or court is primarily concerned only with the one
case before it. The tribunal or court was sought to resolve a dispute based on
the applicable law, and to that extent, general policy considerations are irrelevant.
However, the law often provides the tribunal or court with significant leeway,
either when interpreting the law, or simply because no specific rules exist (for
instance on issues of arbitration procedure). The question is whether, and to
what extent, the tribunal or court should consider a legal position in a case
because it is pro-arbitration, or dismiss a position because it is anti-arbitration.
The answer may differ depending on whether an arbitral tribunal (as part of
the inner-arbitration circle) or a court (standing outside that inner-arbitration
circle) decides on an issue of arbitration law.
An arbitral tribunal may be inclined to decide on an issue of arbitration law
also based on the policy consideration whether its position is pro- or anti-
arbitration. At least factually, the arbitrators may make these considerations
because they have an interest in a thriving arbitration practice. Nonetheless,
given the multitude of pro-arbitration considerations and their trade-offs, as
described by Professor Bermann in his 2018 article, being per se pro-arbitration
may not be relevant for a given case. Oftentimes, any side of an argument can
be seen as pro-arbitration by one arbitrator, while the co-arbitrators may
prefer the other side of the argument.
Policy considerations, however, may become relevant if a legal issue puts
in doubt the very essence of arbitration, i.e. when there is a clear pro- and anti-
arbitration stance. For instance, an arbitral tribunal of an intra-EU investment
arbitration is faced with the issue whether it should decline its jurisdiction
because of the CJEU decisions that the arbitration clause in the relevant
investment treaty is invalid. Declining jurisdiction may be seen as a clear anti-
arbitration decision. It may thus be no surprise that almost all tribunals so far
have declined to follow the CJEU and therefore upheld their jurisdiction. The
legal reasoning, however, is regularly not based on an abstract pro- versus
anti-arbitration stance, but rather on the consideration that the tribunal’s
jurisdiction is based on public international law and not EU law.
Another example is an arbitral tribunal’s decision whether to accept its
jurisdiction although the investment treaty containing the arbitration clause
was terminated by both contracting states. The termination often extends to
the sunset clause that would otherwise have allowed an investor to bring a
claim some time after the termination of the treaty. It may be a clear pro-
arbitration stance to accept jurisdiction and flout the states’ attempt to
circumvent the sunset clause to the investor’s detriment. But more broadly
speaking, it is not self-evident that such a decision would in general support
the legitimacy of arbitration. States may be reluctant to agree to arbitration
clauses in future investment treaties if they lose the option to end their
undertaking to arbitrate with immediate effect. This shows that arbitration
legitimacy may be in the arbitrators’ minds when making a decision, but it often
does not provide an unequivocal guidance for the resolution of a legal issue.
The situation is different for a court, which stands outside the inner-
arbitration circle. It normally is not concerned with arbitration legitimacy. The
court, depending on the jurisdiction, may officially consider policy grounds when
rendering a judgment. But these policies are based on the expressed legislator’s
views, or general policy concerns, which are not arbitration specific. It thus is
relevant if a legislator expressly takes a pro-or anti-arbitration stance.
A court will therefore regularly follow an anti-arbitration stance in the
(local) law. For instance, any court in an EU Member State will follow the CJEU’s
decisions and therefore consider that an arbitration clause in an intra-EU
investment treaty is invalid. It would do so whether or not an arbitral tribunal
has come to a different conclusion. There is no longer room for an arbitration
legitimacy discussion, which needs to take place at the general policy level as
shown above. Arbitration legitimacy considerations may only become relevant
if other policy views expressed by the legislator or the highest courts contradict
the otherwise anti-arbitration stance. For instance, it would be more difficult
for a local court to refuse the enforcement of an ICSID award, given a state’s
agreement under Article 54(1) ICSID Convention to enforce these awards. But
even then, arbitration legitimacy considerations, if the court makes any, would
not provide a clear guidance for the resolution of that issue. The court would
likely be more concerned about how it can, if at all, avoid breaking international
law (i.e. the ICSID Convention) and disobeying the CJEU at the same time. As
recent examples show, the courts in the EU tend towards upholding the CJEU’s
decision even if that means disregarding an obligation arising from public
international law.
A court not bound by the CJEU would at least in general be more open for
pro- or anti-arbitration considerations. Picture the example that a US court is
sought to enforce a non-ICSID award of an intra-EU investment treaty case
rendered in an EU Member State. The legal issue is whether the court should
enforce the award, based on the New York Convention, or pay deference to the
CJEU, having decided that at the seat of the arbitration (as well as in the host-
state and the investor’s home state) the award would be unenforceable for lack
of a valid arbitration agreement. Although not being bound by the CJEU decision,
the U.S. court may decide to follow it (for instance based on Article V(1)(a) New
York Convention and Sections 201 and 202 Federal Arbitration Act). It may
also enforce the award given that the CJEU did not (and cannot) rule that the
arbitration agreement is invalid under public international law. This legal
issue becomes even more intricate if the arbitration was seated outside the EU.
The U.S. court may consider whether under its own arbitration policy (determined
by the Federal Arbitration Act and the U.S. Supreme Court), it would be proper
to enforce the award although it is unenforceable in the states most closely
connected to the substance of the dispute (i.e. the host state and the investor’s
home state)—where the non-enforceability is seen as a matter of public policy.
The New York Convention would allow such a non-recognition only if these
considerations amount to a violation of U.S. public policy. Pro-arbitration
considerations here are in conflict with considerations of deference to foreign
policy. But they likely do not provide clear guidance on how to rule in these cases.
In sum, at a level of arbitration policy, being pro-arbitration means
considering arbitration’s legitimacy, as Professor Bermann described in his
2018 article. This is particularly the case when faced with a clear anti-arbitration
policy. Being pro-arbitration means both, addressing non-arbitration concerns
and showing that arbitration is the better dispute resolution mechanism—if
adapted to the specific needs of the field. In arbitration practice, however,
arbitration legitimacy plays a smaller role. Tribunals and courts may consider
pro-arbitration positions, but probably cannot determine how to decide a
certain issue based on such considerations.
Chapter 12
HOW TO BE PRO‐ARBITRATION IN FIVE LESSONS
Alexandre Senegacnik*
Be it as a student, research assistant, or ultimately as a researcher, I have

always treasured George Bermann’s unique ability to find the most powerful
images in support of his thought-provoking arguments. The following
“pastilles”—inspired by original New Yorker cartoons—pay tribute to five
pieces which certainly helped to strengthen transnational arbitration as a
functioning and balanced system. As many other pieces from the celebrated
author, the five pieces made their way into the classical répertoire of
arbitration literature.
* Dr. Alexandre Senegacnik is a Researcher and Lecturer at Sciences Po Law School. He is
actively involved in the practice of international arbitration. He was a visiting scholar at

Columbia Law School and other universities. He participates as an observer for ASADIP in the
sessions of the Working Group III of the UNCITRAL on the reform of Investor-State Dispute
Settlement. Alexandre Senegacnik is Deputy Secretary-General of the International Academy of
Comparative Law.
81
I.
Mapping the Arbitral Labyrinth
“Rescuing the Federal Arbitration Act: The New Restatement on
International Arbitration”,
20 Yearbook of Private international Law 15 (2020).
U.S. Arbitration Law: enter at own risk.

HOW TO BE PRO-ARBITRATION IN FIVE LESSONS 83
II.
Anchoring Arbitration within PRIL
“International Arbitration and Private International Law.”,
Recueil des cours 381 (2017).
All I know is that the captain said we had to stop by.

III.
The Arbitral Compass: Comparative Law
“Recognition and Enforcement of Foreign Arbitral Awards:
The Interpretation and Application of the New York Convention by
National Courts”,
Springer, Ius Comparatum (2017).
No!—Even the French would not dare to do

this with the New York Convention.
HOW TO BE PRO-ARBITRATION IN FIVE LESSONS 85
IV.
Setting Boundaries
“The ‘Gateway’ Problem in International Commercial Arbitration”,
37 Yale Journal of International Law 1 (2012).
Sir, I am afraid you simply cannot board

with non‐gateway issues.
V.
Lighting Up the Path
“Private International Law in International Arbitration”, in F. Ferrari &
D. P. Fernández Arroyo,
Private International Law: Contemporary Challenges and Continuing
Relevance, Edward Elgar (2019) 466.
Transnational solutions may come in handy!

Chapter 13
“PRO-ARBITRATION” IN AN INVESTOR-STATE
CONTEXT: IS THE DUTCH MODEL BIT “PRO-
ARBITRATION”?
Ana Martinez Valls*
In October 2018 I met with Professor Bermann to kick off the organization
of the 10th edition of Columbia Arbitration Day (CAD 2019). At the time,
Professor Bermann had just published his article “What Does it Mean to Be
‘Pro-Arbitration’?” and he suggested that I read it to find potential topics for
CAD 2019. Professor Bermann’s article focused on what “pro-arbitration” means
in the context of a commercial arbitration. However, given the calls in the last
few years for investor-State dispute settlement (ISDS) reform—and even if, as
explained by Professor Bermann, it can be sometimes difficult to separate
arbitration as a foreign investment dispute resolution mechanism, from law
and policy—it is worth discussing if the measures that are being proposed to
reform the ISDS system are, in fact, “pro-arbitration.”
This essay analyzes whether the Dutch model bilateral investment treaty
(Model BIT) is “pro-arbitration.” First, it discusses what is “pro-arbitration” in
investment arbitration, and it analyzes this concept in the context of the ISDS
reform (I). Second, it discusses whether the Dutch Model BIT fits this concept (II)
I. PRO-ARBITRATION IN ISDS
As Professor Bermann explains, a pro-arbitration policy, is a policy or practice

that favors the achievement of international arbitration’s purposes, whatever
those may be. The purposes of ISDS are twofold: to protect foreign direct
investment (FDI), and—as enshrined in the preamble of the ICSID Convention—
foster economic development. With these initial purposes in mind, a “pro-
arbitration” policy in investment arbitration is one that grants legitimacy to
the system by reconciling foreign investors’ and host State’s interests.
Shane Spelliscy—who also spoke at CAD 2019—highlighted the role of the
UNCITRAL Working Group III (WGIII) in reforming ISDS and creating a series
* Ana Martinez Valls is an Associate at Sidley Austin where she focuses her practice on
investment and commercial arbitration, with an emphasis on Latin America and Spain. Prior to
joining Sidley, Ana worked in leading international arbitration firms in both Spain and New
York. Ana received an LL.M. from Columbia Law School (Fulbright Scholar), where she was a
James Kent Scholar, Columbia Arbitration Day’s Chair, and an editor of the American Review of
International Arbitration. Ana also holds a bachelor’s degree in business administration (BBA)
and in law from IE University and IE Law School (Spain).
87
of pro-arbitration policies that aim to end ISDS sustained condemnation by

addressing civil society’s concerns.
However, the mandate of WGIII is to focus exclusively on the procedural
aspects of ISDS reform. This is an issue since, as it was outlined during the last
sessions of WGIII, there are still concerns about the reform of substantive
standards in international investment agreements (IIAs), which are of utmost
importance to the system. Therefore, the reform of the procedural aspects of
ISDS needs to be harmonized with a pro-arbitration reform of the substantive
investment protection rules in IIAs, which States should lead.
This is what various States have recently begun to do. For example, some
countries have signed new multilateral investment agreements (e.g., the United
States-Mexico-Canada Agreement (USMCA)). Some others like the Netherlands
and Italy have published new model BITs that address some of the concerns
against ISDS. In this regard, the Dutch Model BIT deserves special attention
because (i) Dutch BITs are the second most globally invoked BITs, and (ii) the
Netherlands maintains the fourth most extensive network of BITs in the world.
Thus, the Model BIT—that will be used for renegotiating the 90 Dutch BITs
that are currently in force—could serve as a source of inspiration for the third-
generation BITs that will be signed in the upcoming years.
II. IS THE DUTCH MODEL BIT PRO-ARBITRATION?
Given the potential impact that the Dutch Model BIT will have in the
context of the ISDS substantive reform, first, it is interesting to analyze whether
it includes pro-arbitration policies that rebalance the substantive rights and
obligations of investors and host countries, and thus, whether it can be taken
as a model by other countries (i.e., whether it can ultimately advance the ISDS
substantive reform that UNCITRAL WGIII cannot pursue) (A). Second, it is
important to analyze whether the concerns that some stakeholders have raised
regarding the need to include further sustainable investment provisions in the
Model BIT, or to exclude some allegedly invasive process reforms, have some
merit (B).
A. The Model BIT Rebalances the Rights and Obligations of Investors and
Host States
Given the escalating criticism regarding the alleged imbalances between

investors and host countries in BITs, the new Model BIT aims at striking a better
balance between both. In particular, the Model BIT achieves this goal by
modifying the scope and the substance of the Model BIT’s protections, and by
including specific requirements for investors to contribute to the sustainable
development of a given host country. The most relevant changes are summarized
below.
“PRO-ARBITRATION” IN AN INVESTOR-STATE CONTEXT 89
Definition of investor. One of the main criticisms of the 2004 Dutch model
BIT (2004 Model BIT) was its broad definition of “investor.” Indeed, for a
company to be an “investor” under the 2004 Model BIT, it merely had to be
constituted in the Netherlands, or to be controlled by a company incorporated
in the Netherlands. This definition led to active treaty shopping. In response
to these concerns, Article 1(b)(ii) of the Model BIT imposes a stricter eligibility
requirement for investors, who now need to have “substantive business activities”
in the Netherlands—or to be owned or controlled by a Dutch company meeting
such substance requirement—to qualify as an “investor.” Under this definition,
mailbox companies will no longer be protected under Dutch BITs. Article 1(ii)
should be read together with the new denial of benefits clause included in
Article 16(3), which carves out from the definition of investor corporate
restructurings aimed at attaining investment protection.
Definition of investment. The new Model BIT clarifies the vague
definition of investment included in the 2004 Model BIT—which only introduced
a non-exhaustive list of assets—by specifying that an investment will no longer be
protected under the Model BIT unless it fulfills certain characteristics, which are
largely based on three of the Salini criteria (i.e., (i) duration, (ii) “the commitment
of capital or other resources,” and (iii) “the expectation of gain or profit, and
the assumption of risk”). These requirements will prevent some FDI flows that
do not necessarily have a positive economic impact in the Netherlands from
qualifying as an investment under the Model BIT.
Fair and Equitable Treatment (FET) and Legitimate Expectations.
First, Article 9(2) of the Model BIT narrows down the scope of the FET standard
by establishing a numerus clausus list of elements constituting its breach, which
can be subject to changes through a joint interpretative declaration. Limiting
the scope of FET is perhaps the most important substantive reform, considering
that out of the 20 arbitration cases under a Dutch IIA that completed the merits
stage, the tribunal found FET breaches in 10 of them. The new FET clause in the
Model BIT increases legal certainty and can, thus, be considered “pro-arbitration.”
Second, regarding legitimate expectations, the Model BIT clarifies that neither
the modification of a country’s regulatory regime “in a manner which negatively
affects an investment,” nor the “discontinuation of a subsidy” per se constitute
a treaty violation. This measure directly addresses UNCITRAL WGIII’s concern
that “the mere threat of using ISDS ha[s] resulted in regulatory chill and
discouraged states from undertaking measures aimed to regulate economic
activities and to protect economic, social and environmental rights.”
Sustainable FDI. The Model BIT includes two new articles on investment
promotion and facilitation, and sustainable development. Article 3 provides,
among other things, that parties should “strive to strengthen the promotion
and facilitation of investments that contribute to sustainable development,”
while Article 6 clarifies what should be understood as “sustainable development.”
However, it is unclear what would happen if an investor or a State breach—to
some extent—Article 3 or Article 6 since the Articles fall outside Section 4 of
the Model BIT, which contains the standards that can, if breached, lead to
damages in an arbitration.
Notwithstanding the above improvements, some stakeholders believe that
the Model BIT does not provide a “policy reset” that would put sustainable
development first as host States would like to. At the same time, other
stakeholders argue that the procedural provisions of the Model BIT tilt the
playing field strongly in favor of host States, and that they represent invasive
process reform. Given the latter, can we still consider the Dutch Model BIT to
be a pro-arbitration treaty that other countries should replicate? As discussed
in the next section, it depends.
B. The Dutch Model BIT: Too Much Reform and Also Not Enough
Despite specific improvements in rebalancing the rights between investors

and host countries, many stakeholders still claim that the Model BIT fails to
improve some of the systemic imbalances of the ISDS system. Perhaps the
critics of the Model BIT are misdirected and, instead, some alternative solutions
are needed to achieve a host State’s sustainable development goals (1). On the
other hand, the opponents of the current party-appointed arbitrator system
claim that the Model BIT taps into the current trend of invasive process reform,
and includes some “anti-arbitration” measures (2).
1. The Model BIT allegedly fails to address some concerns
First, the definition of investments in the Model BIT appears to be based on

the Saba Fakes v. Turkey standard: the definition only includes three out of the
four Salini criteria, excluding the “contribution to the host state’s economy”
criterion. Professor Karl P. Sauvant considers that, to attract sustainable FDI,
model BITs should also include the “contribution to the host state’s economy”
criterion together with a specification that the contribution must be made in a
sustainable manner. However, including the Saba Fakes criterion of “contribution
to the host state’s economy” could lead to an unnecessary ambiguity at the
jurisdictional stage. Therefore, it is more reasonable (i.e., more “pro-arbitration”)
to leave this matter to the discretion of arbitrators, who, in light of the articles
of the Model BIT that address sustainable development, will decide on a case-
by-case basis whether “contribution to the host state’s economy” requirement
should be applied.
Second, while some articles of the Model BIT include international sustainable
standards, their impact is rather weak in practice. Article 6 cites several
international agreements but merely states that parties “reaffirm” their
commitments under said agreements insofar as they are a party to them,
without requiring their ratification and implementation. Also, Article 7 only
encourages investors to incorporate internationally recognized corporate
social responsibility standards and guidelines, without establishing a binding

obligation to fulfill them.
Even if some of the above observations are true, referring to sustainable
development requirements in the text of the Model BIT already constitutes a
major advancement in the arena of BITs, and it is in any case preferable—and
probably more “pro-arbitration”—to leave arbitrators with the choice of how,
and to what extent, implement them (instead of imposing excessively restrictive
and formalistic standards). In any case, as Dutch Minister Sigrid Kaag explained
at her Keynote Speech during the 13th Annual Conference of the Columbia
Center on Sustainable Investment, “investment treaties are not the pathway to
address all issues.” The solution might not be to extensively reform the current
ISDS system but instead to embrace the fact that BITs and IIAs have to be
complemented by other initiatives to improve sustainable investment.
2. The Model BIT abandons party-appointed arbitrators and prohibits

double-hatting
First, the Model BIT abandons the party-appointed arbitrator system.

Article 20(1) provides that “[a]ll Members of the tribunal . . . shall be appointed
by an appointing authority.” This reform, which departs from established ISDS
approaches, has not been well received in the arbitral community: it has been
qualified as a “radical proposal” and as a “bellwether for what lies ahead” in
the arena of invasive process reform. This is probably because—as pointed out
in the 2018 Queen Mary University International Arbitration Survey—members
of the arbitral community consider that the ability to appoint arbitrators is one
of the most valuable characteristics of arbitration. The general perception is
that party-appointed arbitrators are necessary to preserve parties’ ability to
shape the expertise of a tribunal for a specific dispute, and that its elimination
would block the development of international arbitration.
Second, the Model BIT prohibits double hatting (i.e., acting as both counsel
and arbitrator). Article 20(1) provides that arbitrators “shall not act as legal
counsel or shall not have acted as legal counsel for the last five years in
investment disputes . . . .” Also, the Model BIT requires that all arbitrators to be
“expert[s] in public international law, which includes environmental and
human rights law [and] international investment law.” These requirements
are, on their face, hardly attainable.
Given the controversy that abolishing party-appointed arbitrators and
prohibiting double hatting generates (i.e., given that these reforms are not
perceived as being “pro-arbitration” by many users of the ISDS system), these
reforms should probably not be included in future negotiated BITs. Instead,
States should continue to debate these reforms in UNCITRAL WGIII, which has
the mandate to tackle procedural reforms such as the latter. In fact, that is
precisely what WGIII has been doing in its 41st and 42nd sessions where it
discussed a draft joint ICSID-UNCITRAL Code of Conduct for Adjudicators in

International Investment Disputes that will regulate the issue of double hatting.
* * *
The Dutch Model BIT seems to rebalance the rights of investors and host
States. The Model BIT denies the protection to shell companies, it limits and
clarifies some of the most relevant substantive standards of protection such as
FET, and it includes sustainable investment provisions in the body of the treaty
(and not only in its preamble). Therefore, one can consider that the Model BIT
is a pro-arbitration instrument (i.e., it helps securing the legitimacy of the
system, and is more in line with the current society and its values (including
sustainable development)). But does the reform advanced by the Model BIT
falls short, or does it go too far? First, even if the Model BIT is not perfect in
achieving sustainable investment, it clearly advances that goal, and, in any case,
sustainable investment can—and should—be achieved through other policy
measures (e.g., establishing a screening mechanism of FDI). Second, some of
the procedural reforms included in the Model BIT are unnecessarily invasive,
and overstep in WGIII’s mandate. Therefore, if other States decide to take the
Dutch Model BIT as an example to renegotiate their BITs, they should avoid
including the reforms related to abolishing party-appointed arbitrators, or the
prohibition of double hatting.
Notwithstanding the above, for the most part, the Dutch Model BIT can be
considered “pro-arbitration” since it addresses the concerns of States regarding
the substantive aspects of ISDS. Although it remains to be seen whether the
reforms advanced by the new Model BIT converge around a renewed treaty
network, there is no debating that the Model BIT contributes to the broader
reform of ISDS mandated to UNCITRAL, which, to be effective, needs to be
synchronized with reform of the substantive investment protection rules
embodied in IIAs.
Chapter 14
TEMPORAL DIMENSIONS OF
“PRO‐ARBITRATION” TRADE‐OFFS
Anika Havaldar*
In his elegant article, Professor Bermann lucidly illustrates the need to adopt
a wide lens when assessing the arbitration-friendliness or “pro-arbitration”-
ness of a particular practice or policy. This widened lens, he explains, should
consider not only traditional “pro-arbitration” metrics like cost-effectiveness,
efficiency, flexibility, finality, and party autonomy but also legitimacy
considerations based on values “extrinsic to arbitration.” Determining when
traditional metrics should be subordinated to so-called legitimacy considerations,
Professor Bermann amply demonstrates, is a challenging and likely subjective
exercise. One complexity that plagues such “pro-arbitration” trade-offs but
receives little explicit discussion in Professor Bermann’s article concerns the
choice of the appropriate timeframe or temporal lens for analysis. Indeed, this
choice influences how one determines the optimal “pro-arbitration” trade-off
in several important ways. For instance, expanding the timeframe for analysis
inevitably affects the framing and subsequent assessment of the costs and
benefits of a given arbitration-related policy or practice. It may thus influence
decisions about which policy or practice alternative best reconciles conflicts
between different “pro-arbitration” considerations. Moreover, the relative
weight or importance that one ascribes to a particular legitimacy consideration
may depend on the temporal lens adopted. A backward-looking approach, for
example, would emphasize the historical rootedness or longevity of an extrinsic
value within a legal system. It may therefore ascribe lesser weight to emerging
or evolving values, like privacy and environmental sustainability, than a forward-
looking approach. In short, achieving the optimal “pro-arbitration” result
requires critical reflection on the temporal dimensions of managing the trade-
offs among competing “pro-arbitration” considerations. Using Professor
Bermann’s article as a jumping-off point, and similarly focusing on international
commercial arbitration, this contribution seeks to prompt such reflection by
highlighting three temporal dimensions of “pro-arbitration” trade-offs.
A first set of temporal questions concerns the timeframe to be applied
when assessing the costs and benefits of the arbitration-related practice or
policy at issue. These questions arise, for example, when one must determine
the extent to which a traditional “pro-arbitration” metric like party autonomy
or cost-effectiveness should be subordinated to legitimacy considerations that
* Anika Havaldar is an Associate at Freshfields Bruckhaus Deringer US LLP. All views and
mistakes are the author’s.

93
yield mostly longer-term payoffs. Take, for instance, extrinsic values such as the
promotion of environmentally sustainable practices in arbitration proceedings or
diversity of arbitrators, counsel, and experts in the international arbitration
community. Giving effect to these extrinsic values likely requires imposing
immediate costs to gain incremental and longer-term benefits. Limiting the
timeframe for analysis to shorter-term costs and benefits may thus counsel
against compromising on traditional “pro-arbitration” considerations like
party autonomy and procedural flexibility and favor less burdensome policies
to promote these values, such as voluntary protocols or pledges. By contrast,
expanding the timeframe for analysis to factor in longer-term benefits may
justify more stringent policies and limits on party autonomy or procedural
flexibility. Put differently, viewed through a longer-term lens, policies that appear
decidedly anti-arbitration at first glance may arguably advance a “pro-arbitration”
agenda when broadly conceived.
Similar, albeit potentially more complicated, questions regarding the
appropriate analytical timeframe arise when the costs of a policy or practice
are not apparent in the short-term but build up or aggregate over time. For
example, the international arbitration community has widely supported
maximizing party autonomy and freedom of contract by permitting parties to
choose a governing law that may lack an apparent link to them or their dispute.
This broad conception of party autonomy may gradually further the populist
perception that international arbitration is being used to circumvent a
jurisdiction’s national laws. It may therefore have longer-term detrimental
effects such as breeding mistrust and hostility toward international arbitration
in that jurisdiction. In these situations, assessments of the “pro-arbitration”-
ness of maximizing party autonomy would likely depend on the extent to
which the long-term risks and costs are considered. One can imagine, for
instance, that the “pro-arbitration” trade-off may feature different approaches
to mandatory rules depending on whether such long-term costs are factored
in or discounted.
While selecting the appropriate timeframe requires considering how far
into the future the analysis of “pro-arbitration” trade-offs should extend, the
second set of temporal questions asks whether and, if so, what role historical
context should play in determining the optimal “pro-arbitration” trade-off. In
other words, when trying to reconcile competing pro-arbitration considerations,
should the selection of the optimal “pro-arbitration” trade-off attempt to correct
for historical factors? Take, for instance, the United States Supreme Court’s
recent decision eliminating the prejudice requirement for demonstrating the
waiver of arbitration rights. Against a historical background of hostile attitudes
toward arbitration in some United States jurisdictions, the imposition of the
prejudice requirement could have been justified as a “pro-arbitration” move at
the time, even if it was out of step with how the legal system generally
addressed waivers of other rights. Now that attitudes have shifted, the
elimination of the same prejudice requirement can also be seen as a “pro-
TEMPORAL DIMENSIONS OF “PRO-ARBITRATION” TRADE-OFFS 95
arbitration” move. Likewise, policies qualifying arbitrator immunity to a

greater than typical extent may conceivably be seen as “pro-arbitration” in the
short-term in a jurisdiction in which international arbitration has historically
been viewed with skepticism or hostility. In a different historical context,
however, that trade-off may be suboptimal or even far from ideal. While
consideration of the historical context may help more effectively advance a
“pro-arbitration” agenda at a given time, it injects new complexities into the
“pro-arbitration” calculus. Notably, it necessarily makes the optimal “pro-
arbitration” trade-off into a moving target that requires continual correction
or adjustment. This may not be practical or desirable, particularly with respect
to “pro-arbitration” trade-offs made by courts or legislatures. As with the
choice of the analytical timeframe, the question of the role of historical context
must therefore be carefully considered.
A third and distinct temporal dimension of “pro-arbitration” trade-offs
relates to the temporal lens through which legitimacy considerations should be
weighed. Indeed, the choice between (or combination of) a backward-looking
and forward-looking lens can influence whether a legitimacy consideration is
deemed sufficiently weighty to override competing pro-arbitration considerations
like efficiency and confidentiality. Arbitral tribunals (mostly in investor-state
arbitrations but sometimes also in commercial arbitrations) confront the
choice between a backward-looking and forward-looking approach when
determining the appropriate level of confidentiality and transparency in
arbitral proceedings. Under a backward-looking approach, a tribunal would
likely assess the need for transparency based on the historical importance
accorded to the subject-matter of the dispute and relevant historical indicia
such as the involvement of governmental actors, international organizations,
or non-profits in the negotiation of the arbitration agreement. Under a forward-
looking approach, in comparison, the arbitral tribunal would likely ascribe
greater weight to evidence of the growing trend of transparency in international
arbitration and the predicted public implications of the dispute at hand. The
optimal “pro-arbitration” trade-off between confidentiality and transparency
would look different depending on the tribunal’s chosen approach. For example,
a more backward-looking approach might favor confidentiality over transparency
when there is no record of historical public interest in the issues or dispute at
hand. A more forward-looking approach might, however, favor greater
transparency even in the absence of such a record.
As the number of international commercial arbitrations involving
environmental, social, and governance issues continues to rise, the question of
whether to adopt a more backward-looking or forward-looking approach when
gauging the strength of the public interest in a dispute will likely gain more
prominence. The choice of approach could be determinative, for example, when
assessing the appropriateness and form of third-party interventions and
amicus curiae submissions in arbitral proceedings. In the context of investor-
state arbitrations, tribunals have expressed divergent views on what factors to

prioritize when determining the sufficiency of a third party or amicus curiae’s

interest in a dispute. Tribunals that emphasize factors such as the demonstrated
impact on the third party or amicus curiae’s rights or the specific involvement
of the third party or amicus curiae in the dispute—following a more backward-
looking approach—have tended to limit third-party or amicus curiae
participation. Meanwhile, tribunals that consider a broader array of factors to
assess whether the third party or amicus curiae’s participation would advance
the legitimacy of the award—following a more forward-looking approach—
have often reached opposite results. Divergent opinions concerning third-
party or amicus curiae participation in the investor-state context suggest that
the choice between a backward-looking or forward-looking approach may
similarly lead to distinct conceptions of the public interests or legitimacy
considerations at play in international commercial arbitrations.
Professor Bermann’s article urges us to widen the lens through which we
evaluate the arbitration-friendliness of policies or practices. That naturally begs
the question: Just how wide should this lens be? In a temporal sense, the answer
is complicated and may sometimes be determinative for the “pro-arbitration”
trade-off ultimately reached. As the above examples illustrate, pro-arbitration
trade-offs involve decisions—whether conscious or subconscious—about many
temporal issues, including whether to apply a longer-term analytical timeframe,
to account for historical context or factors, or to adopt a backward-looking or
forward-looking approach when gauging legitimacy considerations. Yet, as
compared to other legal areas like administrative law, discussion about the
role of temporal issues in assessing the friendliness or unfriendliness of policies
or practices appears rather limited in international arbitration. Given their
potential to skew our conception of “pro-arbitration” considerations, these
temporal dimensions of managing “pro-arbitration” trade-offs deserve greater
attention.
Chapter 15
SECURITY FOR COSTS: FACIALLY ANTI-
ARBITRATION BUT UPON CONSIDERATION
DECIDEDLY PRO-ARBITRATION
Ank Santens and Stephen Hogan-Mitchell*
I. INTRODUCTION
It is a pleasure to submit these reflections in honor of Professor Bermann, who

was as inspiring to Ank in his class on Transnational Litigation and International
Arbitration in 1996 as he was to Stephen in his class on International Commercial
Arbitration twenty-five years later in 2021. Professor Bermann’s 2018 piece,
What Does it Mean to Be “Pro-Arbitration”?, is quintessentially Bermann-esque,
offering an insightful discussion of the complexity underpinning the determination
of whether a practice or policy serves or runs counter to arbitration’s aims. As
Professor Bermann points out, many policies and practices in international
arbitration generate controversy because they impede certain values of
arbitration while simultaneously promoting others. The procedural tool of
security for costs is one such controversial practice.
Security for costs is an interim protective measure that requires a claimant
to provide security for an eventual order that the claimant must bear all or part
of the respondent’s costs of the arbitration. Failure to comply with an order for
security for costs can lead to a stay of the proceedings or even dismissal of the
claim.
Some voice concerns that requiring security for costs is anti-arbitration
because it denies access to justice due to a claimant’s lack of financial resources.
Indeed, arbitral tribunals have demonstrated significant restraint toward
orders for security for costs in both commercial and investor-State disputes,
setting high standards that are difficult to meet and rarely granting applications
(which claimants make infrequently to begin with).
Our thesis is that the procedural tool of security for costs is not anti-
arbitration, but rather pro-arbitration, if properly applied. It protects a
respondent by deterring frivolous claims or, at a minimum, ensuring the
respondent is made whole at the end of the road of having to defend against
them. Requiring security for costs in appropriate circumstances thus protects
and enhances arbitration’s legitimacy, as it addresses an otherwise intolerable
situation where respondents are required to defend against unmeritorious
* Ank Santens and Stephen Hogan-Mitchell are Members of the International Arbitration
Practice at White & Case LLP based in New York. The views expressed in this essay are the
authors’ personal views. They should not be attributed to White & Case LLP or its clients.
97
claims without a meaningful opportunity to recover their defense costs from

the unsuccessful claimant at the end of the road. Of course, security for costs is
not appropriate in all circumstances and care should be taken to construct
appropriate and clear standards for applying this interim measure. Arbitral
institutions have an important role to play by incorporating such standards in
their arbitral rules. By creating and applying an appropriate framework for
security for costs in international arbitration, the arbitration community can
protect the legitimacy of arbitration and its status as the premier dispute
resolution mechanism for international disputes. This is what it means to be
pro-arbitration.
II. THE EVOLUTION OF SECURITY FOR COSTS IN INTERNATIONAL

ARBITRATION
The origins of security for costs are found in the English legal tradition,
where the law evolved to permit the practice in a broad range of litigation
(Noah Rubins, In God We Trust, All Others Pay Cash: Security for Costs in
International Commercial Arbitration, 11(3) Am. R. Int’l Arb., 7–8 (2000)). The
remedy is closely tied to the principle in English litigation that the “costs follow
the event,” meaning that the losing party in a proceeding should bear its costs,
including the other party’s legal fees. Security for costs emerged in order to
give teeth to this philosophical approach and protect defendants from frivolous
or bad faith claims. However, the English courts also recognized the potential
chilling effects of this remedy, and traditionally the circumstances justifying its
application have been narrow. Still, the practice continues to be an important
remedy to ensure recovery of costs from unsuccessful claimants residing in
foreign jurisdictions or in a precarious financial position.
Similar equitable concerns prompted the emergence of the practice in
arbitral proceedings. Arbitrators generally enjoy broad discretion to award
costs to a successful party. They have increasingly done so, following the English
approach that the costs follow the event (Alan Redfern & Sam O’Leary, Why it
Is Time for International Arbitration to Embrace Security for Costs, 32 Arb. Int’l 397,
405, n.10 (2016)). However, a losing party’s inability or unwillingness to pay
may threaten the effectiveness of cost awards. To address this concern, the
procedural vehicle of security for costs found its way into the international
arbitration system.
Security for costs was first considered at the request of respondent parties
in international arbitrations inspired by the English legal tradition. Over time,
several rules of arbitration, particularly of arbitral institutions based in
jurisdictions with a legal system based on the English legal system, such as
those of the HKIAC, LCIA, and SIAC, expressly envision and permit tribunals to
award security for costs (See HKIAC, Administered Arbitration Rules (2018)
Article 24; LCIA, Arbitration Rules (2020) Article 25.2; SIAC, Arbitration Rules
(2016) Rule 27(j)). Those that do not include such explicit grants of authority,
SECURITY FOR COSTS 99
such as the ICDR, ICC, and UNCITRAL rules, are still generally seen as implicitly
providing for such orders under their broad grants of discretion to tribunals
to award interim relief.
The same general recognition has emerged in investor-State disputes,
where the majority of ICSID tribunals have recognized their authority to order
security for costs under Article 47 of the ICSID Convention and Rule 39 of the
2006 ICSID Arbitration Rules, which grant tribunals the power to order
provisional measures (See, e.g., Dirk Herzig as Insolvency Administrator over the
Assets of Unionmatex Industrieanlagen GmbH v. Turkmenistan, ICSID Case No.
ARB/18/35, Decision on the Respondent’s Request for Security for Costs and
the Claimant’s Request for Security for Claim dated January 27, 2020 ¶ 47;
Lighthouse Corporation Pty. Ltd. and Lighthouse Corporation Ltd. IBC v.
Democratic Republic of Timor-Leste, ICSID Case No. ARB/15/2, Procedural
Order No. 2–Decision on Respondent’s Application for Provisional Measures
dated February 13, 2016 ¶ 53; Alan Redfern & Sam O’Leary, Why it is time for
international arbitration to embrace security for costs, 32 Arb. Int’l 397, 410–12
(2016)). In line with this trend, recently approved amendments to the ICSID
Arbitration Rules that went into effect on July 1, 2022 include an express
provision for security for costs (ICSID, Arbitration Rules, Rule 53 (2022)). The
UNCITRAL Working Group III is also considering reforms related to security
for costs (UNCITRAL, Report of Working Group III (New York, 14–18 February
2022) at *2).
III. ARBITRAL TRIBUNALS’ HESITANCY TO ORDER SECURITY FOR COSTS
While tribunals largely recognize their authority to award security for costs,
they generally remain hesitant to order the measure in both commercial and
investor-State disputes. In investor-State disputes, for example, security for
costs has been granted in only three known cases (RSM Prod. Corp. v. Saint
Lucia, ICSID Case No. ARB/12/10, Decision on Saint Lucia’s Request for Security
for Costs dated August 13, 2014; García Armas v. Républica Bolivariana de
Venezuela, PCA Case No. 2016-08, Orden Procesal No. 9 dated June 20, 2018;
Unionmatex Industrieanlagen GmbH v. Turkmenistan, ICSID Case No. ARB/18/35,
Decision on the Respondent’s Request for Security for Costs and the Claimant’s
Request for Security for Claim dated January 27, 2020; there may be a fourth
case, see Lisa Bohmer, Counsel Funding Arbitration is Ordered to Provide
Written Undertaking that It Will Pay Hypothetical Adverse Costs Award in Treaty
Dispute; Request for Disclosure is Rejected, Investment Arbitration Reporter
(Feb. 17, 2022)). Additionally, the tribunal in Unionmatex later reversed its
order when it became clear that the claimant would be unable to comply with
it (See Cosmo Sanderson, ICSID panel rescinds security for costs order, Global
Arbitration Review (June 12, 2020)).
Underpinning this hesitation are three primary concerns. First and
foremost, tribunals fear impeding access to justice by preventing meritorious
claims. Particularly concerning to tribunals are situations where a claimant’s

impecuniosity is a direct result of the alleged actions taken by the respondent
(Noah Rubins, In God We Trust, All Others Pay Cash: Security for Costs in
International Commercial Arbitration, 11 Am. R. Int’l Arb., 18 (2000)). It can be
debated whether arbitration raises the same access to justice considerations
as court proceedings, being quintessentially based on party consent rather
than a State’s provision of a basic judicial system. This is particularly the case
for commercial arbitration, where the claimant specifically chose arbitration,
including the possibility of security for costs. The concern is more valid in the
case of investor-State arbitration, where the investor rather benefits from a
right negotiated on its behalf by its home State (although arguably the right
may be subject to various preconditions including the financial wherewithal to
satisfy any adverse cost award), or in consumer and labor arbitration, where
it is questionable whether the consumer or employee was truly free in agreeing
to the arbitration.
Second, tribunals fear prejudging the merits of the case, as the request is
premised on an argument that the claimant may be ordered to pay respondent’s
costs, and thus that the claimant may lose the case. That these requests come
early in a case further elevates this fear, as the tribunal’s knowledge of the case
is limited by the time a party makes its request for security. This fear also
extends to prejudgment of the philosophical approach the tribunal will adopt
in respect to costs orders. While there is a general trend towards requiring the
unsuccessful party to bear the costs, tribunals have discretion and may choose
to require parties to bear their own costs or apportion costs under the
discretion afforded to tribunals by the arbitration rules. As to the first concern,
while tribunals should be careful not to prejudge the merits or be seen as doing
so, determining whether claims appear prima facie meritorious is an endeavor
that commercial arbitration tribunals routinely undertake when deciding
applications for other interim measures, although in keeping with the standards
applied by the International Court of Justice, ICSID tribunals generally do not.
We believe there are good arguments that the question of whether the outcome
that the interim measure sought is intended to protect is likely to materialize
is a very relevant inquiry that should be undertaken on a prima facie basis
based on the information known at that time. As for the second concern, all
that needs to be decided is whether the tribunal may follow the principle that
the costs follow the event, such that there may be an eventual cost award that
may be ineffective if security for costs is not granted. The costs follow the event
principle is increasingly followed, in particular where the result was not a close
call but rather a decisive loss for the claimant, which is a reasonable possibility
when the claims appear prima facie meritless.
Third, some tribunals may fear that ordering security for costs absent an
express grant of authority to do so in the parties’ agreement or the applicable
arbitration rules or law means deviating from the parties’ expectations. This
reaction may stem from the perception of security for costs as a remedy ingrained
only in certain common law jurisdictions and therefore inappropriate in other

contexts (Noah Rubins, In God We Trust, All Others Pay Cash: Security for Costs
in International Commercial Arbitration, 11 Am. R. Int’l Arb., 18 (2000)). In the
same vein, some argue that orders requiring security for costs should necessitate
a showing of a fundamental change in the claimant’s circumstances since entering
the arbitration agreement, because the parties should have been aware of each
other’s payment risks and the respondent should not be put in a better position
than it previously was in. These arguments disregard the increasing recognition
that international arbitration tribunals have the power to order security for
costs, which implies the possibility of such an order as part of the parties’
arbitration agreement (Alan Redfern & Sam O’Leary, Why it Is Time for
International Arbitration to Embrace Security for Costs, 32 Arb. Int’l 397, 401
(2016)). Additionally, while this argument has some weight in the commercial
context where the parties’ intent in negotiating their contract is paramount, it
is less applicable when applied to investment arbitration, which is not based
on a bilateral contract but on a State securing arbitration rights for its nationals.
In our view, arbitral tribunals’ significant hesitancy to grant requests for
security for costs does not give enough weight to the remedy’s appropriateness
as a tool for combatting unfairness to respondents facing unmeritorious claims
with no effective means of ultimately being made whole if they prevail on the
merits of the case. This risk should not be underestimated, as defending against
claims, even if frivolous or ultimately unmeritorious, often costs millions of
dollars. This scenario is particularly vexing in investor-State arbitration cases,
where it raises public policy concerns, as States’ citizens must unfairly bear the
unrecoverable costs incurred in defending unsuccessful claims from foreign
investors. As Professor Bermann noted, these considerations extrinsic to
arbitration’s specific aims are important in determining whether a practice is
pro-arbitration because they affect its overall legitimacy (George Bermann,
What Does it Mean to Be “Pro-Arbitration”?, 34 Arb. Int’l 341, 352 (2018)). Security
for costs enhances the legitimacy of arbitration in the eyes of respondents, in
particular respondent States in investment treaty arbitration.
IV. AN APPROPRIATE FRAMEWORK FOR ORDERING SECURITY FOR

COSTS
Security for costs is an appropriate tool in the toolkit to counteract dubious

claims by impecunious claimants who face significant upside, and little to no
downside, by pursuing their claim. An appropriate framework for security for
costs allows tribunals to strike the proper balance between addressing this threat
and the need to ensure that claimants may actually exercise their procedural
right to arbitrate.
In order to succeed in grants of interim measures, parties generally must
show that their requests are necessary, urgent, and proportional in light of the
circumstances. In light of these requirements, and the particular considerations
raised by a security for costs application, commentators have pointed to four

criteria that tribunals should consider in deciding whether to grant a request for
security for costs (Alan Redfern & Sam O’Leary, Why it Is Time for International
Arbitration to Embrace Security for Costs, 32 Arb. Int’l 397, 410–12 (2016)).
First, at least in the commercial arbitration context, tribunals need to ask
whether on a prima facie basis the claimant has a reasonable chance of succeeding
on its claims. As stated earlier, tribunals have shown great hesitancy in
prejudging the merits of a case, but there is no reason to believe that tribunals
are incapable of this endeavor, which they already must undertake when
deciding applications for other interim measures.
Second, a tribunal should determine whether there is a reasonable possibility
that it may award costs to the respondent if it were to prevail. As discussed
above, all that needs to be decided is whether the tribunal may follow the
principle that the costs follow the event, such that there may be an eventual
cost award that may be ineffective if security for costs is not granted.
Third, tribunals should determine the likelihood that the party ordered to
pay costs would be unable or unwilling to do so. Factors the tribunal can
consider include the financial position of the party, whether the party is a shell
company without assets, and whether the party has a history of failing to
comply with costs orders (Alan Redfern & Sam O’Leary, Why it Is Time for
International Arbitration to Embrace Security for Costs, 32 Arb. Int’l 397, 410–
12 (2016)). None of these factors need be sufficient on their own, and tribunals
should have discretion in balancing them. New ICSID Arbitration Rule 53(3)
addresses this by instructing the tribunal to consider the “ability” and
“willingness” of a party to comply with an adverse costs decision as well as the
“conduct” of the parties.
Finally, tribunals should consider the overall fairness of such an order
given all the circumstances. This catch-all consideration will permit tribunals
to ensure their decisions do not unfairly impede access to justice (Alan Redfern
& Sam O’Leary, Why it Is Time for International Arbitration to Embrace Security
for Costs, 32 Arb. Int’l 397, 411–12 (2016)).
At this point, it is useful to briefly address whether and how third-party
funding should factor in the analysis. The issue of security for costs has garnered
the most attention, and stirred the most emotions, in investor-State arbitration
where respondent States sought security for costs to protect against claims by
impecunious claimants funded by third parties. Mr. Gavan Griffith QC’s statement
in RSM v. Saint Lucia that third-party funding represents “the gambler’s Nirvana:
‘Heads I win, and Tails I do not lose” is well-known (RSM Production Corporation
v. Saint Lucia, ICSID Case No. ARB/12/10, Decision on Saint Lucia’s Request for
Security for Costs, Assenting Reasons of Gavan Griffith dated August 13, 2014
¶ 13). New ICSID Arbitration Rule 53(4) also addresses this concern,
specifically permitting tribunals to consider “the existence of third party
funding” in their determination whether to grant security for costs. In our
view, the presence of third-party funding by itself by no means warrants
security for costs, and third-party funding plays a useful and important role in
international arbitration. But where the funding was obtained because the
claimant is impecunious and the claims are prima facie meritless, tribunals
should not hesitate to order security for costs and should not be deterred by
access to justice concerns. There is no reason why funders should or would be
unwilling, in principle, to assume the risk of an adverse cost award. The funder
can incorporate this factor into its economic calculus of the claim and seek a
higher recovery to account for the additional risk. Any concern that this would
reduce the availability of funding has little merit in view of the ever-growing
number of funders and available funding. In fact, funders may soon be required
to incorporate the risk of paying adverse costs into their calculations, at least
in the European Union, which recently introduced legislation to regulate third-
party funders that includes a requirement that such funders be liable for
adverse costs awards (See Report 2020/2130/INL of the European Parliament
of 15 July 2022 with recommendations to the Commission on Responsible
private funding of litigation [2022]). If a claimant brings prima facie
unmeritorious claims, it is fair to put the claimant to the test of finding funding
for the risk of an adverse cost award, and there should be no access to justice
concern. Unmeritorious claims would be reduced, enhancing the legitimacy of
arbitration in the eyes of respondents, and thus as a whole. The UNCITRAL
tribunal in Jak Sukyas v. Romania and Edward Sukyas v. Romania recently
ordered the claimants’ counsel, who is funding the claims, to submit a written
guarantee that it would pay a hypothetical adverse costs award (See Lisa
Bohmer, Counsel Funding Arbitration is Ordered to Provide Written Undertaking
that It Will Pay Hypothetical Adverse Costs Award in Treaty Dispute; Request for
Disclosure is Rejected, Investment Arbitration Reporter (Feb. 17, 2022)). In
appropriate circumstances, tribunals should consider ordering third-party
funders to do the same.
V. CONCLUSION
The procedural tool of security for costs at first glance appears to be an

inherently anti-arbitration practice, leading to hesitancy in the arbitral
community around its use. However, this hesitancy risks endangering core
values of international arbitration, such as the efficiency of arbitral proceedings
and the effectiveness of arbitral awards. Moreover, requiring security for costs
can promote important values extrinsic to arbitration that enhance its broader
legitimacy, such as protecting a State’s citizens from unfairly shouldering the
defense costs of a claim brought against its government by an award-proof
party bringing unmeritorious claims that is unwilling or unable to comply with
a costs award. A closer inspection of the practice leads to the conclusion that
security for costs is patently pro-arbitration when used in the right circumstances.
Fortunately, the arbitration community is increasingly recognizing the
benefits of this interim measure in the appropriate circumstances. The new
ICSID rule on security for costs is an important step in providing a clear

framework to tribunals for deciding applications for security for costs and
thus making them more comfortable with granting such applications in the
right circumstances. These developments signal that the arbitration
community will shift its perspective on security for costs to see it as a tool
that, when properly applied, increases the efficiency and effectiveness of
international arbitration and enhances its legitimacy, and is thus decidedly
pro-arbitration.
Chapter 16
PRO-ARBITRATION = PRO-LITIGATION
Anton Chaevitch*
“Which arrow flies forever? That arrow that has hit its mark.”
Vladimir Nabokov
To be pro-arbitration is to believe that law should always improve.

Immediately, the question arises—but can law not improve without
arbitration? There is no doubt that it can. But arbitration—specifically
international commercial arbitration, the focus of this contribution—provides
a very powerful driver for improvement: an alternative. Courts are public;
arbitration is private. Courts have fixed locations, arbitration does not. Courts
must apply the law of their jurisdiction, except where that law directs them
otherwise; arbitrators apply the law the parties have chosen. Judges are
generally selected by public institutions; arbitrators are selected by the
parties. The list of differences goes on.
Instead of “alternative,” I almost wrote “competitor,” because arbitration can
continue to prosper only if it is a better option than litigation for certain situations.
But competition presupposes winners and adversaries, whereas litigation and
arbitration improve, rather than defeat, each other.
Arbitration as an alternative to litigation shows what can be better, not just
in theory, but very much in practice. Some of the first objections to arbitration
were not normative, but practical—lawyers were not able to imagine how the
consent-driven approach to dispute resolution that is arbitration could even
function. It would never work, they thought. But it has now been shown that
it can.
The discussion has therefore shifted to other questions, such as whether
litigation or arbitration is better, or whether a particular decision or policy is
good for litigation or bad for it, and good for arbitration or bad for it. We wonder
now not whether arbitration can exist, but whether it is good for arbitration
that a particular award was annulled on due process grounds or whether it is
good for litigation that a certain issue of public policy is resolved in arbitration
rather than litigation. These are, no doubt, important and nuanced questions.
It is very important both that awards are annulled when the fundamental due
process rights of a party have been violated, just as it is important that they are
not annulled when a party’s unreasonable requests for more process have
* Anton Chaevitch, A.B., A.M., Ph.D, Harvard University; J.D., Columbia Law School; is
currently an Associate at Three Crowns US LLP. The views expressed herein are strictly the
author’s and do not represent the views of Three Crowns LLP or its clients.
105
been denied. It is very important that issues of public policy be resolved

competently, and it is important to ask when arbitrators will, and when they will
not, be well-placed to do so. And it is, as Professor Bermann has established, far
too simplistic to say that every decision to annul an award is anti-arbitration,
and every decision to enforce an award is pro-arbitration.
But what often gets lost in these questions is the value of the fact that they
are raised in the first place, and that they are raised because of arbitration. For
instance, due process has, in many jurisdictions, developed into a highly complex
web of rights and procedures specific to that jurisdiction. For those who navigate
that web, it can become hard to separate the parts that truly are essential due
process rights from those that are not. Arbitration, through its very existence,
confronts lawyers with a way of resolving disputes where due process is
simpler and less formal than in litigation. For instance, when a court has to
decide whether a party’s due process rights were violated so as to warrant
vacatur, the judges have to decide whether simpler and less formal process
than in litigation was nonetheless adequate. Courts today generally do not
simply apply their own procedural law to resolve this question (although some
courts did in the early days of arbitration). Rather, courts ask whether the due
process violations are of such a fundamental nature as to meet the high burden
for vacatur. That is, the courts separate themselves from their own due process
norms to a degree in order to delve into the essence of due process. At the same
time, the courts’ own ways inform their decisions, for what a court considers
essential due process cannot but be informed by the laws that the court usually
applies, and by its legal culture.
Thus, a decision not to annul an award can cause a legal system to review
itself. For when a court accepts that less process, or simpler process, than is
required domestically is still sufficient process, the court distinguishes the
essential elements of due process from the non-essential ones. Such a distinction
then raises the question of whether changes may be needed to the domestic
system—for a court cannot in all situations say that a party’s fundamental due
process rights were not violated in arbitration and then turn around and, in a
similar situation, say that they were in domestic litigation. No doubt, good
reasons exist for the requirements of due process to differ between litigation
and arbitration—but there are also good reasons to wonder whether process
in litigation should not be reduced and simplified in certain situations.
At the same time, a decision to annul an award may improve arbitration, in
that it shows it where it has perhaps gone too far down the line of simplifying
process or has deemed as international something that is in fact common only
to the arbitrators themselves. This applies not only to annulments that all or
most of the world’s independent courts would have arrived at, but also to
annulments that are based in the peculiarities of a particular legal system.
Iura novit curia provides an interesting example of this process of mutual
improvement. Iura novit curia is common in civil law jurisdictions but quite
alien to common law jurisdictions. Iura novit curia, Latin for “the court knows
PRO-ARBITRATION = PRO-LITIGATION 107
the law,” means that a court can, sua sponte, apply the law to the facts,
regardless of what the parties have or have not argued or pleaded (although
many jurisdictions impose limitations on this doctrine, for instance that the
court cannot award relief that was not requested). In common law systems,
however, courts are generally less likely to raise legal arguments sua sponte,
and where they do, they generally invite the parties’ input. The application of
iura novit curia by arbitrators has raised numerous requests for annulment,
some of which have been successful. This has generated debate in the arbitration
community on the appropriate use of iura novit curia in arbitration. At the
same time, common law courts upholding awards in which iura novit curia was
applied have had to wonder whether better outcomes might not be reached
when courts are more proactive, both in raising arguments not raised by the
parties and in going beyond what the parties have argued.
This mutual improvement plays out similarly in other aspects of the law.
For instance, courts have had to ask which aspects of their jurisdiction’s public
policy should be grounds for vacating an international arbitration award, and
which should not. Where a jurisdiction has a public policy that an interest rate
above 10% is usurious, should it annul an arbitration award that involves a
higher interest rate based on the law of another jurisdiction? Where a jurisdiction
has a strong public policy against contracts between parties with unequal
bargaining positions, should it apply that to an arbitral award rendered under
the law of a different jurisdiction? Can questions that involve complex domestic
public policy, such as antitrust or financial regulation, be entrusted to arbitrators?
These are by no means simple questions. Arbitration confronts courts with
these questions and the need to draw the line between an acceptable difference
with another jurisdiction’s norms and an impermissible transgression of its own
public policy. That, in turn, raises the question of whether the domestic public
policy should change where the court has now determined that it can be deviated
from in arbitration. The answer will not always be yes, but it will sometimes
be yes.
Here, too, an annulment can be beneficial to arbitration. Perhaps the
arbitrators, even if they correctly applied the law of a jurisdiction that has no
concept of usury, should have considered that the resulting award cannot be
truly international, in the sense that it will not be globally enforceable. Perhaps
when they were faced with a complex public policy of a particular country, they
should have treated it with greater care, or even held it to be outside of their
mandate.
Nothing here is intended to suggest that the entire legal world will or
should converge to one way of doing things. On the contrary, because each
jurisdiction is unique, it will arrive at its own unique answers to the questions
that arbitration confronts it with, as will arbitrators in response to the
questions that litigation confronts them with.
Far from being a problem, this wealth of different approaches is part of what
it means to be pro-arbitration. Take, for instance, the much-debated questions
of when courts should determine the jurisdiction of an arbitral tribunal: before

the arbitration starts or only after the award is issued? And if courts can do so
before the arbitration starts, should they do a full review or a prima facie
review only? And should the arbitration be stayed, or can proceedings run in
parallel? Each approach has its own advantages and disadvantages, which
have also been extensively debated: if a court determines jurisdiction before
the arbitration starts, that delays the arbitration, but if the court can do so only
after the award is issued, there is a risk that the entire arbitration was a waste
because the tribunal had no jurisdiction; staying the arbitration causes delay,
but parallel proceedings are not efficient either; and so on.
These are all important debates, but these debates can obscure the true
value of arbitration—namely that arbitration prompts these debates in the first
place, which in turn prompt improvement, and that arbitration allows different
approaches to co-exist. In the world of arbitration, parties can choose from the
range of different, available options—those parties that prefer jurisdictional
challenges only to be possible upon the conclusion of an arbitration can select
the seats for their arbitrations accordingly, as can parties that would rather be
able to challenge the jurisdiction of arbitrators from the outset.
To be pro-arbitration, then, is to be for the benefit that comes from the
existence of an alternative. It is therefore the same as to be pro-litigation. For
where litigation benefits from the alternative that is arbitration, so, too,
arbitration benefits from the alternative that is litigation. Each jurisdiction
benefits arbitration, because it enriches it with its unique traits; arbitration
benefits each jurisdiction, because it helps it to examine itself. Where arbitration
goes too far down the path of simplifying process or resolving issues of public
policy, courts rein it back in. Where courts go too far down the path of formality
and complexity, arbitration reminds them that there are simpler alternatives.
One final point must be made. Too often, law has been conceived of as going
towards a fixed end point. Napoleon believed that his codifications were the
end point of law, and law should not develop further. Frederick the Great
believed similar things about his codifications, albeit for different reasons.
Classical Legal Thought in the United States postulated that law would reach
an end point because as precedent built and built, eventually all law would be
clear and unambiguous.
But to be pro-arbitration is to believe that law has no fixed end point, but
rather exists in a perpetual process of improvement—of which arbitration is a
vital part, and one that, itself, requires perpetual improvement: the arrow has
hit its mark, and flies forever, because the mark is to fly forever.
Chapter 17
MASS ARBITRATIONS: A PRO-ARBITRATION
APPROACH OR ABUSE OF ARBITRATION?
Ashlesha Srivastava*
This essay covers the background, leading cases and new legislation dealing
with the phenomenon of mass arbitrations. It discusses whether this novel
strategy employed by resourceful plaintiff’s bar serves arbitration’s purposes
or, in fact, disserves the spirit and purpose of arbitration.
I. BACKGROUND
In recent years, many companies have sought to limit their exposure to

class action lawsuits through a combination of mandatory arbitration clauses
and class-action waivers in their terms of service, terms of use, and other form
contracts. The overwhelming market trend is for companies to use arbitration
as a means to avoid class actions and limit the publicity of disputes. For
consumers, employees, and gig-economy workers who accepted the agreement
to arbitrate, this meant they were bound to arbitrate on an individual basis in
a single proceeding. In practical terms, the monetary value of the claim and
even a potential victory in an arbitration was often outweighed by the legal
costs and associated time and effort of pursuing an individual arbitration.
In a novel response, coordinated groups of consumers, employees, and gig-
economy workers are now taking advantage of agreements to arbitrate disputes
on an individualized basis by initiating individual arbitration claims on behalf
of thousands of claimants at the same time. Instead of facing a single class action,
some companies are seeing a wave of thousands of individual arbitration claims
filed concurrently. The consequences for companies and employers are stark:
under the arbitration agreement or pursuant to institutional rules in consumer
and employment arbitrations, the company is required to pay all or most of the
filing fees. As a result, the initial filing costs borne by companies can quickly
escalate into millions of dollars.
The increase in mass arbitrations can be attributed predominantly to a
strategy devised by a resourceful plaintiff’s bar and start-ups that target online
ads and social media to locate potential claimants. In other circumstances, mass
arbitrations are the result of a court action initiated by a company seeking
enforcement of a class-action waiver in an arbitration agreement. Ironically, in
* Ashlesha Srivastava, LLM, Columbia Law School (2017), is a Dual-Qualified International
Arbitration Attorney (New York and India) specializing in international commercial and investor-
state disputes.
109
doing so, companies have themselves walked into mass arbitration, where instead
of arbitrating an individual claim, plaintiffs’ firms have brought on thousands
of individual arbitrations akin to class arbitrations. Recent cases involving
companies like DoorDash, Postmates and Intuit underscore the gravity of the
situation.
II. DOORDASH, INC.
In August 2019, approximately 6,000 couriers filed individual arbitrations

against DoorDash before the AAA, claiming they were properly characterized as
employees. Because the applicable AAA Rules required each individual to pay
$300 in filing fees and DoorDash, as the responding company, to pay $1,900,
DoorDash was immediately saddled with $12 million in administrative fees.
DoorDash refused to pay, claiming there were significant deficiencies with the
couriers’ filings, and in response, they commenced an action to compel arbitration
in the California state courts. The district court granted the motion to compel
as to around 5,000 petitioners and ordered DoorDash to commence the AAA
arbitrations. Calling out DoorDash for so-called “hypocrisy,” Judge William Alsup
observed, “[t]he irony, in this case, is that the workers wish to enforce the very
provisions forced on them by seeking, even if by the thousands, individual
arbitrations, the remnant of procedural rights left to them. The employer here,
DoorDash, faced with having to actually honor its side of the bargain, now
blanches at the cost of the filing fees it agreed to pay in the arbitration clause.”
III. POSTMATES, INC.
Postmates faced a similar situation in 2019 after more than 5,200 couriers
filed individual arbitration demands against Postmates with the AAA. Like
DoorDash, Postmates resisted paying the approximately $10 million that would
otherwise be due in AAA filing fees, arguing that the petitioners had failed to
bring their claims in accordance with the arbitration agreement and were
attempting to bring a de facto class-wide arbitration in breach of the class
action waiver. The individual couriers then petitioned to compel arbitration in
California. Echoing the decision in DoorDash, the Court concluded that
“Postmates’ obligation to tender $10 million in filing fees as a result of those
arbitration demands is a direct result of the [arbitration agreement]—which
Postmates drafted and which Postmates required each courier to sign as a
condition of working for Postmates. It strains credulity for Postmates to argue
that the amount of filing fees due constitute irreparable harm when that ‘harm’
is entirely of its own making.”
IV. INTUIT
Intuit was faced with a class action on behalf of 125k consumers and had
already paid over $13 million in filing fees. Intuit then spent over one year in
MASS ARBITRATIONS 111
litigation before courts in California to bring consumers to arbitrate their claims.

When the 9th Circuit finally granted Intuit’s request to compel arbitration—
plaintiffs’ firm brought over 100k claimants for AAA arbitrations. Intuit then
attempted to orchestrate a class-wide settlement to obtain releases from all
class members, including those who have filed arbitration demands. However,
the court denied preliminary approval for such a class settlement, finding, among
other things, that the proposed settlement “unduly burden[ed] all class members,
but especially those who have already begun to pursue claims through
arbitration.”
Each of these examples demonstrates that courts have not been receptive
to arguments against claimants’ strategy in bringing individual mass arbitrations.
Indeed, observations made by courts have only validated claimants’ arguments
that the terms of arbitration agreements allow for mass arbitration. In the
Postmates case, the court observed, “[i]t strains credulity for Postmates to
argue that the amount of filing fees due constitute irreparable harm when that
‘harm’ is entirely of its own making,” Similarly, in Intuit, the court was largely
unsympathetic towards Intuit, noting that it had been “hoisted by their own
petard.” In Doordash, the court remarked that it is “poetic justice” for companies’
long fought-for insistence that arbitration agreements be enforced as written.
But do mass arbitrations indeed serve justice to either party or to the spirit
and core principles of the arbitration process? Arguably, the claimants’ strategy
of filing mass arbitrations is to ultimately avoid arbitration altogether. By
inundating companies with mass claims and burdening them with the exorbitant
associated filing fees, claimants are only seeking to level the playing field to
extract settlements from companies rather than litigating the merits of the
dispute.
A plaintiff firm taking on thousands of individual claimants in a short span
of time raises serious issues that go to the root of the integrity of the arbitration
process. First, presumably, unless the plaintiffs’ firm has adequate resources
and time, thorough vetting of claims for frivolity and fraud would be extremely
difficult to achieve. The second important issue concerns consent. When a
company executes an arbitration agreement with a consumer or employee, it
is consenting to the arbitration process with that consumer and employee and
that consent does not extend to arbitration with thousands of employees at
once. However, as stated earlier, due to the excessive filing fees that a company
must bear to simply commence the arbitration, it is very difficult to identify
and eliminate frivolous and fraudulent claims and litigate issues of consent
before the arbitrations commence, irrespective of whether the claims have
merits. This begs the question of whether, ultimately, mandating companies to
comply with the payment of filing fees as leverage serves any justice towards
the arbitration process or is simply an abuse of the arbitration process.
To further protect consumers and employees, California adopted SB 707
(SB 707, codified at Cal. Code Civ. Proc. 1281.97.), which is aimed at companies
that resist paying the significant filing fees that come with mass arbitrations
and imposes harsh consequences for failure to pay arbitration fees. As of

January 1, 2020, if the drafting party in an employment or consumer arbitration
(typically the respondent company) fails to pay the required arbitration fees
and costs within 30 days of the due date, it will be deemed to have materially
breached the arbitration agreement, deemed to be in default of the arbitration,
and to have waived its right to compel arbitration. The employee or consumer
can then elect to withdraw from arbitration and pursue their claim in court or
compel arbitration under the contract, in which case the company will be required
to pay reasonable attorneys’ fees and costs related to the arbitration.
This new law allows employees and consumers to remove their claims to
court or continue with arbitration by compelling companies to pay the necessary
fees. Nonetheless, this new legislation may further provide additional leverage
to employees and consumers going forward.
Postmates filed an action seeking a declaratory judgment that SB 707 is
preempted by the FAA and unconstitutional. In January 2021, C.D. Cal. rejected
Postmates’ challenge to SB 707, holding that “SB 707 encourages arbitration by
changing the remedies available to non-drafting parties when drafting parties
delay the process and refuse to pay required fees.” This decision is under
appeal and it remains to be seen whether SB 707 is compatible with the FAA.
This observation seriously underscores the challenge of providing additional
leverage to employees and consumers going forward. Arguably, instead of
encouraging or aiding the arbitration process, this law further forces companies
to the negotiating table to facilitate mass settlements in order to avoid the
arbitration process altogether and limit their exposure to harsh sanctions.
V. MITIGATING THE NEW RISK OF MASS ARBITRATION
Some arbitral institutions have responded by offering mass claims protocols

and other protections for companies facing thousands of arbitration claims.
For example, the International Institute for Conflict Prevention and Resolution
(CPR) launched the Employment Related Mass Claims Protocol, which is
applicable when more than 30 claims are filed against the same company in
close proximity. The AAA introduced the Employment/Workplace Fee Schedule,
which applies to group filings where more than 25 claims are filed. Similarly,
FedArb has introduced a Mass Employment Arbitration Framework that provides
expedited arbitration rules and reduced administrative fees, an MDL-like panel
comprising three judges. ADR Services Inc has also launched a Mass Employment
Arbitration Fee Schedule that applies to group filings where more than 20 claims
are filed involving the same or similar parties/claim/counsel.
Though these rules seem to mitigate the risk posed by mass arbitrations
and provide a mechanism to facilitate the arbitration process by providing some
safety to companies, these rules are new and untested. While the law regarding
mass arbitrations is continuing to develop, companies are already modifying
their existing arbitration agreements and terms of use to mitigate the risk of
MASS ARBITRATIONS 113
mass arbitrations. This includes ad hoc arbitration, not administered by an

arbitral institution, or using an alternative institution that has already adopted
approaches that address mass arbitrations. Additional strategies include
bespoke dispute resolution clauses that require parties to agree to a test case
or a phased approach that limits the number of cases that could proceed at one
time. None of these strategies or new rules are without risks and some may be
unenforceable or even illegal in some jurisdictions. These issues need to be
monitored carefully, as arbitration rules and fee schedules are changed to meet
user demands. Companies will have to remain mindful of the risks of challenges
by consumers and employees on unconscionability grounds if the applicable
arbitration clauses do not appropriately safeguard their procedural and
substantive rights.
This complicated landscape is perhaps what may prompt an exodus from
mandatory arbitration clauses altogether. Earlier this year, after facing over
70,000 arbitration demands over a period of two years, Amazon announced its
extreme approach of removing the mandatory arbitration provision and class
action waiver from its consumer online terms of service. It remains to be seen
whether Amazon’s move will trigger a larger movement by companies looking
to address the challenges presented by mass arbitrations. As this space continues
to develop and evolve, it is quite clear that the use of class action waivers/
mandatory arbitration clauses, once perceived as pro-arbitration policies are less
about access to justice and the arbitration process and more about maximizing
leverage tactics.

Chapter 18
ANOTHER ASPECT OF “PRO‐ARBITRATION”:
ENFORCEMENT
Brenda D. Horrigan*
Professor Bermann has rightfully focused his discussion on the definition

of “pro-arbitration” and the qualities that can make certain policies or
positions more (or less) friendly to arbitration. For jurisdictions that are
already on the “arbitration-friendly” spectrum, the discussion is enormously
useful.
A more basic question, however, must still be asked in many contexts—
namely whether a jurisdiction itself is “pro-arbitration” or “arbitration-
friendly”. As arbitration lawyers, when making such determinations we tend
to focus on arbitral seats—advising clients to choose a seat that will support,
and not unduly interfere with, an arbitration conducted within its
boundaries.
What unfortunately receives less discussion, at least at the transaction-
entry stage, is the arbitration-friendliness of the jurisdiction(s) in which any
arbitral award arising from a dispute might ultimately need to be enforced.
International enforceability of arbitral awards under the New York Convention
is one of the key selling points of arbitration over litigation in international
transactions, but the degree to which the ideals of the New York Convention
are recognized in practice varies widely. Although many studies have found
high voluntary compliance by parties with awards, that is not universally true.
There are a number of jurisdictions, particularly those with less-well-
established rule-of-law traditions and/or nationalistic or protectionist courts,
in which enforcement (as opposed to voluntary compliance) is the rule rather
than the exception.
To effectively enforce an award, the successful party must take that award
to the courts of the jurisdiction in which the judgment debtor has assets, and
successfully persuade the courts of that jurisdiction to comply with their
obligations under the New York Convention and enforce the award. The degree
to which the domestic courts or legislation in that jurisdiction are “pro-
arbitration” has a direct outcome not only on the ability to enforce the award
* Brenda D. Horrigan is an International Arbitrator with some thirty years of international
practice across numerous jurisdictions, including the US, Russia, France, China, Australia and
now Singapore. She started her career as a transactional lawyer, and then practiced as
arbitration counsel for two decades before leaving law firm life to focus full time on work as an
arbitrator. She is fluent in English, French and Russian, and speaks elementary (social)
Mandarin.
115
itself, but also on user confidence in, and satisfaction with, the arbitration
process as a whole.
Horror stories abound—many are probably apocryphal, or at the least
somewhat “enhanced” in the telling, but they can still be instructive. One of my
favorites from many years ago involved domestic courts allegedly refusing
enforcement of an award against a bank on public policy grounds, on the
theory that forcing the bank to pay out the award would weaken the bank,
which would weaken the banking system, which would weaken the economy,
and would therefore be against public policy. It is difficult to argue against a
conclusion that such an approach involved an impermissibly broad
interpretation of public policy—and one which was very much not “pro-
arbitration”.
A second, very common issue is the tendency of courts in some
jurisdictions to rely on onerous and contradictory/confusing formality
requirements over the execution of documents to argue that no contract (or no
arbitration agreement) in their view exists, and hence that the award should
not be enforced, despite the arbitral tribunal having reached the opposite
conclusion and having rendered an award. Examples are legion of domestic
courts using such arguments—whether the use of an incorrect seal or lack
thereof, signature in an improper format, execution in the wrong color of pen,
etc.—in a protectionist or nationalistic manner to deny enforcement against
home-domiciled entities, particularly if such entities are large, powerful or
politically-connected. Again, this is not the type of court intervention that falls
into the “pro-arbitration” basket.
If we as arbitration lawyers are going to continue to tout international
enforceability under the New York Convention as one of the primary advantages
of international arbitration over domestic litigation for international transactions,
we need to be more vocal in addressing these limitations.
While it is unrealistic to expect that we can raise the level of “arbitration-
friendliness” in many of the problem jurisdictions in the short term, there are
a number of initiatives underway that are aimed at this goal. The Asian
Development Bank, in particular, has been a key proponent in countries of Asia
Pacific and Oceania; many others also exist. These initiatives are vital and will,
in the longer term, raise the bar for jurisdictional compliance with New York
Convention obligations.
A more immediate measure, however, would be for the arbitration
community to recognize the need (and desirability) to work closely with front-
end transactional lawyers to help them assess and develop strategies for
clients who are keen to invest in less-friendly jurisdictions. There are a number
of relatively straightforward measures that can be taken at the outset of a
transaction, before a dispute arises, to preserve or enhance the likelihood of
enforceability of any eventual award—and, as a corollary, to enhance
negotiating leverage if a dispute were to arise. However, as this is not the focus
of much discussion, opportunities for protective measures are often missed.

ANOTHER ASPECT OF “PRO-ARBITRATION”: ENFORCEMENT 117
One of the most basic protective strategies is to encourage parties to

identify, at the stage of transaction conclusion, what assets exist against which
eventual enforcement might be sought, and where they are located. A
counterparty that was named “Newco” until a few hours before execution of
the transaction documentation is unlikely to have assets against which to
enforce—so identifying what entity(ies) might be added as guarantors or co-
signatories (with hard assets) is key.
Similarly, if the main counterparty is located in a jurisdiction that is
relatively low down on the “arbitration-friendly” spectrum, it is important for
the transactional lawyers to consider whether there are ways to identify or
“ring-fence” assets in a more friendly jurisdiction as security for enforcement
of an eventual award. Are there accounts-receivable streams that can be
protected? Can a bank guarantee or pledge be made in a more pro-arbitration
jurisdiction? If there are necessary currency or other licenses required for
payout under a parent guarantee, have those been obtained and filed?
Another factor is time—how long will it take to obtain an award and,
critically, obtain an enforcement order? The longer the process, the more
opportunity there is for a judgment debtor to “strip” or dispose of assets in an
attempt to avoid seizure. Thus, it is important to also take into consideration
the “movability” of an entity’s assets at the transaction conclusion stage in
order to protect later negotiation/enforcement leverage. It is much more
difficult to transfer trading contracts, operational facilities, buildings and land
than it is to strip ownership of shares in subsidiaries or related entities—
which plays into calculations of which entity(ies) should be added as
parties/guarantors in the transaction.
One of the strengths of arbitration is that it is consensual—the parties
determine the scope of their agreement and their submission to arbitration.
However, when dealing with parties from jurisdictions which are low on the
pro-arbitration spectrum, that is also a weakness, as it restricts the claimant to
seeking enforcement only against its contractual counterparty(ies). Some pro-
arbitration jurisdictions may extend that to certain related entities, as
Professor Bermann has addressed, but that is quite rare (if not unheard-of) in
many less-arbitration-friendly jurisdictions. In those jurisdictions, any vague
disconnect between the named party and any other entity (including, from
experience, a difference in the transliteration of the entity’s name) will bar
extension. Thus, the more that these considerations can be taken into account
before the transaction is concluded—to ensure that there will be an entity
covered by the agreement that has assets available for satisfaction of an award
– the better.
As an arbitration community, we spend considerable time addressing a
perceived complaint by users about the “time and cost” involved in arbitration,
as Professor Bermann has noted. A large component of that "time and cost"
calculation, however—at least in the jurisdictions in which I have primarily
practiced—is not that involved with obtaining the award itself, but rather in

seeking (and perhaps failing to obtain) enforcement of the award once issued.
If we as a community are to truly serve users—and ensure that arbitration
remains an option that is considered favourably—then we owe it to ourselves
to ensure that possible enforcement difficulties are not only acknowledged,
but also recognised and addressed.

Chapter 19
BRAZILIAN ARBITRATION‐FRIENDLINESS
Caetano Berenguer and Gustavo Favero Vaughn*
I. A TRIBUTE
First, a word of gratitude.

Professor George Bermann is a leading light in the field of international
arbitration and an infallible source of academic guidance for practitioners and
scholars worldwide. His authoritative legal texts, amicus briefs, lectures, and
keynote speeches are remarkable in their clarity and precision. His unwavering
efforts to further the development of international arbitration as a fair, effective
and efficient means of dispute resolution have been recognized far and wide.
His role as Chief Reporter for the American Law Institute’s Restatement of
International Commercial Arbitration is, in itself, a clear testament of the esteem
in which he is held in the legal community and beyond.
To his present and former students and research assistants, Professor
Bermann is an inspiration. Particularly to those arriving in the U.S. from foreign
jurisdictions, he is the beacon we need in unfamiliar waters: a towering intellect
combined with a warm, approachable, engaging manner that encourages, guides,
and stimulates. The debates, thoughts, ideas, and ideals remain with us long after
class. And so, we begin our contribution to this tribute with a simple but sincere
expression of gratitude.
Thank you, Professor Bermann.
II. THE “PRO‐ARBITRATION” IDEA: BRAZILIAN STYLE
Professor Bermann’s article “What Does it Mean to Be ‘Pro-Arbitration’?”

is essential reading for those engaged in promoting recourse to alternative dispute
resolution. The author invites his readers to ponder the legitimacy and efficacy
of international arbitration viewed from the perspective of the relevant policy
and practice considerations.
We do not intend to summarize Professor Bermann’s seminal article. Our
aim, rather, is to examine whether and to what extent Brazil can be considered
a “pro-arbitration” jurisdiction. To that end, we reflect on the role played by the
Brazilian judiciary in relation to arbitration. Of course, the first step is to arrive
* Caetano Berenguer is a Partner at Sergio Bermudes Advogados and LL.M. from Columbia
Law School (Class of 2008). Gustavo Favero Vaughn is an International Lawyer at Cleary Gottlieb
Steen & Hamilton LLP, Alumni Advisor of the American Review of International Arbitration
(ARIA), LL.M. from Columbia Law School (Class of 2022), and former Research Assistant of
Professor George Bermann. The views expressed here are the authors’.
119
at an approximate definition of “arbitration friendliness.” That is by no means an

easy task. As Professor Bermann notes, there are “at least a dozen different ways
to measure the impact of a given policy or practice on international arbitration's
well-being” (in William Park [ed.], Arbitration International, vol. 34, 2018,
p. 353). However, as is his wont, he then provides us with the analytic tool we
need: “Viewed in abstract terms, a policy or practice is arbitration-friendly to
the extent that it favors the achievement of international arbitration's purposes,
whatever we take them to be” (p. 342). This then is the definition we adopt in
this essay.
III. NATIONAL COURTS: THE KEY TO SAFEGUARDING ARBITRATION’S

INTERESTS
The widely held view among Brazilian scholars and practitioners is that
arbitration is flourishing as an alternative dispute resolution mechanism and that
this success is due, in no small part, to the support provided by national courts.
The rapid growth in the recourse to arbitration, particularly over the last
two decades, has led the court centers in the two largest state capitals, São Paulo
and Rio de Janeiro, to establish specialist chambers and panels at first instance
and appellate levels. This development has boosted inward investment and
enhanced the attractiveness of both cities as seats for international arbitration.
We consider three distinct phases in our “pro-arbitration” analysis: (1) the
“pre-arbitral” phase, which is, in Brazil, the period prior to the constitution of
the tribunal; (2) the proceedings phase (i.e., post constitution of the arbitral
panel); and (3) the post-award stage. For each of these phases, we focus mainly
on the case law of the Brazilian Superior Court of Justice, which is the court of
last instance for infra-constitutional arbitration-related issues.
Having said that, we start off with a nod to the Brazilian Federal Supreme
Court (Supremo Tribunal Federal), which, in 2001, dismissed a constitutional
challenge to the 1996 Brazilian Arbitration Act (Federal Law No. 9.307). The
Brazilian Arbitration Act is a comprehensive piece of legislation that adopted
many aspects of the UNCITRAL Model Law. It was designed to institute arbitration
as an effective alternative dispute resolution mechanism in Brazil. When, shortly
after the law came into force, a Claimant in foreign arbitral proceedings applied
to enforce the award in Brazil (SEC No. 5.206-EP), the Respondent sought a
declaration from the Federal Supreme Court that key provisions of the
Arbitration Act were unconstitutional. Despite considerable pressure from
various quarters, the Supreme Court resolutely upheld the legislation in a
landmark ruling that heralded a new dawn for resolving disputes in Brazil. In the
two decades that have elapsed since this “pro-arbitration” precedent, the legal
landscape has been transformed almost beyond recognition—and for the
better, although there is still much to be done.
Now we return to the three phases of the Brazilian “pro-arbitration” idea.
BRAZILIAN ARBITRATION-FRIENDLINESS 121
A. First Phase: “Pre‐Arbitration” (Prior To The Constitution of the Tribunal)
During this phase, parties frequently need to apply for urgent relief to
protect the efficacy of any future arbitral award (e.g., an injunction to restrain
the dissipation of assets).
The case law of the Superior Court of Justice is settled and straightforward.
Before the arbitration has formally commenced (i.e., until the arbitrators have
agreed to act), the prospective parties are fully entitled to have recourse to the
courts for emergency or interim measures. However, as soon as arbitration
begins, the jurisdiction of the courts ceases, and arbitral jurisdiction comes
into play. The arbitrators then have full powers to maintain, modify or revoke
the interim or emergency relief granted by the courts. We refer in particular to
three Superior Court precedents to this effect: REsp No. 1948327-SP, especially
the judgment of Justice Moura Ribeiro; CC No. 165678-SP, judgment of Justice
Maria Isabel Gallotti; and REsp No. 1297974-RJ, judgment of Justice Nancy
Andrighi. In 2015, the wording of the Arbitration Act was amended to reflect
this position (Articles 22-A and 22-B).
This is a distinctly “pro-arbitration” approach. When individuals or legal
entities have agreed to arbitrate, courts have a say only at the very outset of
the dispute, pending the constitution of the arbitral tribunal. This initial right
of recourse to the courts sufficiently upholds the constitutional principle of
access to justice, according to the Superior Court ruling in REsp No. 1698730-
SP, judgment of Justice Marco Aurélio Bellizze. In the absence of such a right,
there would be a risk of jurisdictional limbo prior to the constitution of the
tribunal, particularly in more complex cases involving multiple parties, in
which it sometimes takes months to reach an agreement on the constitution of
the panel. It may be that the Superior Court will adopt a different stance in
circumstances in which parties have opted for emergency arbitration. This
practice, however, is still incipient in Brazil.
Further, in relation to this first stage, the Brazilian Superior Court has taken
a markedly pro-arbitration stance in relation to the application of the
competence-competence (Kompetenz‐Kompetenz) doctrine. As is the case in
France (but not the U.S.), the applicable Brazilian legislation (Articles 8 and 20
of the Arbitration Act) imposes both a positive and negative duty, along the
lines of the duality described by Professor Bermann in his article After First
Options: Delegation Run Amok: “The former affirmatively confers on tribunals
authority to determine their jurisdiction, while the latter deprives courts, prior
to arbitration, of that authority” (p. 26).
The Brazilian Superior Court of Justice has issued a number of rulings
upholding the view that, in accordance with the competence-competence doctrine,
arbitrators have priority over judges when deciding who has jurisdiction to decide
on a private-law dispute that has been referred to arbitration (to that effect: AREsp
No. 1276872-RJ, Justice Og Fernandes; CC No. 170233-SP, Justice Moura Ribeiro;
REsp No. 1818982-MS, Justice Nancy Andrighi; REsp No. 1598220-RN, Justice

Paulo Sanseverino; AREsp No. 425931-MG, Justice Ricardo Cueva; CC No. 139519-
RJ, Justice Regina Helena Costa; SEC No. 12781-GB, Justice João Noronha). In
Brazil, arbitrators—and not judges—have the primary authority to decide on
the existence, validity, and efficacy of an agreement to arbitrate or an arbitration
clause included in a contract. Regarding the latter, the Brazilian Arbitration Act
makes provision for the application of the separability doctrine (Article 8).
Professor Bermann describes the essence of this doctrine as follows: “an
arbitration clause, though found within a contract, represents a separate
contract” (International Commercial Arbitration in a Nutshell, p. 35). In effect,
separability is a legal fiction that, also in Brazil, “allows a tribunal to determine
that a contract is valid and unenforceable without, in so doing, invalidating its
authority to make that very determination” (Id.).
There is one clear exception to this position on the competence-competence
doctrine. If the arbitration agreement is prima facie null and void, the Judiciary
can hear claims that would otherwise, in principle, be solely within the remit
of the arbitrators (REsp No. 1761923-MG, Justice Marco Aurélio Bellizze; AREsp
No. 1845956-MT, Justice Raul Araújo; REsp No. 1773599-PE, Justice Paulo
Sanseverino; REsp No. 1850629-TO, Justice Antonio Carlos Ferreira). This
situation may arise in the case of adhesion (standard form) contracts, for instance.
Article 4(2) of the Brazilian Arbitration Act establishes formal requirements
for the efficacy of the agreement to arbitrate (arbitration clause) inserted into
said adhesion contracts. Recourse to arbitration can proceed only if it is the
“adherent” party to the contract that initiates arbitration or if said party has
otherwise expressly and indisputably agreed to arbitration. If one of the formal
requirements of this expression of volition has not been complied with, the
Judiciary can simply ignore the arbitration clause and adjudicate the dispute.
This might appear to be an “anti-arbitration” policy. However, we take the
view that the practical result is that this provision in fact protects the arbitral
forum. Adhesion contracts in Brazil are typically found in consumer relations.
Given the particular social and economic circumstances of large swathes of the
Brazilian population, the legislative power has sought to protect consumers
from the effects of imbalances of power, with the result that consumer disputes
are rarely suitable for the type of informed-consent arbitral proceedings between
sophisticated parties we are considering here.
Brazilian courts do respect the decision of autonomous parties to resort to
arbitration. Other than applications for interim and emergency relief prior to
the constitution of the tribunal, and prima facie null and void arbitration
agreements, the Brazilian Judiciary is highly unlikely to entertain claims that are
filed before it in a departure from the terms of a valid arbitration agreement.
Brazilian courts respect both dimensions of the competence-competence
principle (i.e., the positive and negative stipulation) and avoid any sort of
undue interference during the first stage of the (pre) arbitration process. Even
if, on rare occasions, lower courts mistakenly depart from this position, the
Superior Court of Justice has no hesitation in intervening to redress the misstep.
Nevertheless, it needs to be borne in mind that under Brazilian procedural

law, if a party files a lawsuit before a national court despite the existence of a
valid arbitration clause or agreement, the opposing party must assert the
existence of the agreement to arbitrate as a preliminary argument in its defense
brief. Article 337(X)§5 of the Brazilian Code of Civil Procedure forbids judges
from sponte propria declaring the existence of an arbitration agreement. If the
interested party does not raise the existence of the arbitration agreement in
good time, they will be deemed to have waived the right to arbitrate the dispute.
When, on the other hand, a party does assert the existence of a valid arbitration
agreement in good time and in the proper procedural fashion, the Judiciary will
dismiss the lawsuit without examining the merits of the dispute, applying
Article 485(VII) of the Civil Procedure Code. The Superior Court of Justice has
upheld this outcome, for example, in REsp No. 1550260-RS, Justice Ricardo Cueva.
B. Second Phase: During the Course of the Arbitration
One question that arises is: what role, if any, do Brazilian courts play during
the course of the arbitration proceedings? There is almost no case law on that.
There have indeed been unsuccessful attempts to file a writ of mandamus to a
court to challenge the denial of leave by arbitrators for the production of
certain evidence. National courts are resistant to such attempts because they
defer to the arbitrators’ power to decide on matters of evidence.
As such, if a tribunal decides, for instance, that expert witnesses are not
necessary in a given case, the parties will then have no option other than
proceeding with the arbitration and awaiting the final award. If they then
remain dissatisfied with the tribunal’s ruling on the evidence, they may seek
to set aside the award based on Article 32 (VIII) of the Arbitration Act, alleging
that the denial of leave to produce expert evidence was a violation of due
process. The likelihood of success of such an argument is remote, as can be
seen from the Superior Court ruling in REsp No. 1500667-RJ, but there is no
bar to such an application under Brazilian law.
Arbitrators have essentially free rein in the Brazilian system to decide on
matters of evidence, but they must set out the reasons that led them to reach a
particular decision. The Superior Court of Justice, ruling on an application to
set aside, has held that arbitrators are not bound by national civil procedure
rules on evidence (AREsp No. 1535622-RJ, Justice Maria Isabel Gallotti).
Interestingly, the court went on to indicate that at the evidentiary stage of
arbitration (which is significantly less bureaucratic than the equivalent stage
before the Judiciary), it is for the arbitrators alone to define the relevance of
the evidence for the case and to determine at which moment it should be
produced. In doing so, arbitrators must grant the parties equal opportunities
to present their arguments as to the evidence.
However, national courts do have an important role to play while the
arbitration proceedings are underway. Brazilian law adopts a collaborative

approach between the courts and arbitral tribunals. Arbitrators may seek the
Judiciary’s assistance during an arbitration if need be. For example, suppose a
fact witness unjustifiably fails to comply with a subpoena to give evidence to
the tribunal. As arbitrators lack coercive power (ius imperium), they will need the
assistance of national courts to compel the witness to testify. In Brazil, the legal
mechanism for seeking this cooperation between tribunals and courts is called
an “arbitral letter” and is comparable to a letter rogatory. Both the Brazilian Code
of Civil Procedure (Article 260(3)) and Arbitration Act (Article 22-C) detail the
procedures and requirements to be followed when an “arbitral letter” is needed.
We consider the approach taken by the Brazilian Judiciary to the “second
phase” to be distinctly “pro-arbitration.” Why? Because it guarantees the interests
of arbitration by avoiding undue judicial interference in the course of the
proceedings. At the same time, it ensures the efficacy of arbitration by offering
tribunals the option of seeking judicial assistance in specific situations that
arbitrators are unable to resolve due to their lack of coercive power.
C. The Third Phase: Post‐Award
Thirdly and lastly, we consider the post-award stage. To that end, we look
at three distinct situations: (1) the losing party disagrees with the award and
files an annulment action on grounds set out in the Brazilian Arbitration Act;
(2) the losing party does not voluntarily comply with the arbitration award
and the prevailing party has to file an enforcement action before national courts
in order to impose sanctions on the losing party pending compliance; and (3) the
prevailing party in an international arbitration seeks the recognition of the
respective foreign award before the Brazilian Superior Court of Justice so that
it can be enforced in Brazil.
As is the case in virtually every jurisdiction that upholds the legitimacy of
arbitration, the Brazilian Judiciary is not entitled to review the merits of an
award rendered by arbitrators. Brazilian law does not permit claims of “manifest
disregard of the law.” Judges are not allowed to interfere in the arbitrators’
decisions on the facts or application of the law chosen by the parties. Arbitral
awards are final and binding under Brazilian law and have the same effects as
court orders (Article 31 of the Arbitration Act). Arbitrators are, broadly speaking,
de facto and de jure adjudicators whose decisions are not subject to any sort of
appeal (Article 18 of the Arbitration Act).
The case law of the Superior Court is crystal clear: only formal defects in an
award can be invoked as grounds for annulment (the so-called error in
procedendo). These formal defects are listed in Article 32 of the Brazilian
Arbitration Act. The seven hypotheses described there are exhaustive. The
following Superior Court precedents uphold the view that judicial control over
arbitration proceedings is limited to very exceptional circumstances, all related
to formal defects in the award: AREsp No. 1566306-SP, Justice Marco Buzzi;
and REsp No. 1660963-SP, Justice Marco Aurélio Bellizze. There are several
other rulings to that effect.
This limitation is clearly a “pro-arbitration” policy since it prohibits parties
from using the Judiciary as an appellate court in arbitration proceedings. In fact,
the Superior Court’s arbitration-friendly policy goes even further. The court has
held that arbitral institutions cannot be joined as a party to annulment actions
because, by their very nature, such institutions do not have adjudicatory
authority; they only administer arbitration proceedings, therefore exercising at
most administrative powers (REsp No. 1433940-MG, Justice Ricardo Cueva).
The same rationale is applied to the enforcement of arbitration awards
before national courts. Brazilian courts will act just as they would when enforcing
a judicial award. The enforcement action must comply with the steps set out in
the Civil Procedure Code. National courts cannot in any way modify the content
of the arbitral award being enforced. Any such modification would be a direct
violation of res judicata, one of the bedrocks of the Brazilian legal system.
When it comes to enforcement proceedings of national arbitral awards
before courts, the “judgment debtor” is entitled to resist execution. Still, the
law significantly circumscribes the lines of defense that can be relied upon.
Debtors may challenge enforcement by asserting the defenses set forth in
Article 525(§ 1) of the Civil Procedure Code. These defenses are, essentially:
lack or nullity of service of process; lack of standing of the party; unenforceability
of the obligation being executed; incorrect levy of execution or erroneous
appraisal; excessive or undue accumulation of enforcement proceedings; lack
of jurisdiction of the enforcement court, and any other supervening event that
modifies or discharges the obligation (such as a payment, novation, compensation,
settlement or statutory limitation). Debtors can also argue that the award is
invalid under Article 32 of the Arbitration Act. Hence, they may cumulate both
lines of argument (i.e., under civil procedure law and by the arbitration legal
regime). However, this is possible only if the enforcement action is filed within
the limitation period that applies to applying for the annulment of an award
(ninety days after the rendering of the award). If the enforcement action is filed
after the ninety-day period, the losing party (judgment debtor) is only entitled
to invoke the defenses outlined in the Civil Procedure Code and not those that
would otherwise be available under the Arbitration Act.
This is, essentially, a “pro-arbitration” interpretation by the Superior Court
of Justice of the applicable statutory provisions (e.g., REsp No. 1928951-TO,
Justice Nancy Andrighi; REsp No. 1862147-MG, Justice Marco Aurélio Bellizze).
The arbitration-friendliness inherent to this interpretation is as follows: after
the ninety-day period for filing an annulment action has elapsed, the losing
party will be totally precluded from challenging the validity of the arbitration
award on the grounds set out in the Arbitration Act (formal defects). Said
judgment debtor will therefore be unable to rely on such arguments either in
an annulment action itself or as a defense against enforcement of the award.

Regardless of the arguments raised by the parties, the Judiciary cannot

review the merits of an arbitral award that is being enforced, and it cannot re-
examine the merits of an award that is the subject of an annulment action.
This judicial “pro-arbitration” approach is also apparent in the recognition,
in Brazil, of foreign arbitral awards. Jurisdiction for recognition lies with the
Superior Court of Justice. The New York Convention was incorporated into
Brazilian law by Decree No. 4.311 in 2002. Regrettably, the Superior Court almost
never bases its decisions on the New York Convention. Rather, it cites the
Arbitration Act and the Civil Procedure Code as national normative sources.
Notwithstanding that, the Superior Court has repeatedly ruled that it has no
power to review the merits of foreign arbitration awards, with analysis being
limited to the formal aspects of the request for recognition (SEC No. 853-US,
Justice Jorge Mussi; HDE No. 1809-US, Justice Raul Araújo; HDE No. 1914-FR,
Justice Benedito Gonçalves; HDE No. 120-US, Justice Nancy Andrighi). As a first
step, the Superior Court examines whether the legal requirements for recognition
under Brazilian national law have been met (e.g., the foreign award cannot be
contrary to Brazilian public policy nor offend Brazilian sovereignty). If these legal
requirements are met, the court then proceeds to analyze whether recognition
should be granted to the foreign award. If the award is recognized, it acquires
the same effects as a national court order, being capable of enforcement before
Brazilian courts.
IV. CONCLUSION
To be or not to be “pro-arbitration,” that is the question. As seen in this essay,

the Brazilian Judiciary, represented by its highest court on arbitration matters,
the Superior Court of Justice, is distinctly “pro-arbitration.” The precedents we
have cited, which reflect the settled position of Brazilian courts, have favored the
interests of arbitration in at least two ways. First, they respect party autonomy,
upholding arbitration agreements unless they are prima facie null and void.
Second, they severely restrict judicial control over arbitration proceedings, leaving
arbitrators free to decide on the disputes before them, with any subsequent
intervention by the courts being limited to formal defects in awards.
In all the cases to which we have referred, the Superior Court of Justice has
advanced the interest of arbitration. But there are exceptions to this prevailing
pattern. As in other countries, even in the most arbitration-friendly jurisdictions
such as the U.S. and France, Brazilian courts do sometimes issue decisions that
displease arbitration practitioners and scholars. However, we would say that
such decisions are rare (to the point of being anomalous) and do not necessarily
indicate a deliberately “anti-arbitration” stance by the judges in question. The
Brazilian Superior Court of Justice has shown itself to be remarkably “pro-
arbitration,” and the positive results stemming from that are there to be seen.
Long may they keep on coming.
Chapter 20
THE “GATEWAY” ISSUES IN BRAZIL: A TRIBUTE
TO GEORGE A. BERMANN
Camila Macedo Simão and Elora Neto Godry Farias*
I. INTRODUCTION
For us—arbitration enthusiasts since law school—Columbia always seemed

like the right choice for the same reason: to be taught and lectured by Professor
Bermann. Little did we know that not only is his reputation of being a great
professor just, but he is also an extraordinary human being. Always making
himself available for students, to guide them even on matters that are not only
related to his class, but life in general. Each of us got to know Professor Bermann
in such a privileged way that writing this piece for him can only be called one
thing: an honor.
Within the universe of what it means to be pro-arbitration, Professor Bermann
wrote an article called “The ‘Gateway’ Problem in International Commercial
Arbitration,” in which he defines as gateway those issues that are analyzed by
national courts prior to arbitral tribunals. The term, in its narrow definition,
has been applied by the Supreme Court of the United States to encompass the
“threshold jurisdictional issues” that a court, if requested, will decide, instead
of referring the parties directly to arbitration.
Challenges to the validity, existence and scope of the arbitration agreement
(gateway issues) are generally addressed by the courts at the outset through a
full review of the challenge, unless otherwise agreed upon by the parties.
Challenges regarding conditions precedent to arbitration, time limits and waiver
(non-gateway issues) tend to be referred by courts to the arbitral tribunal.
Further, the separability principle also plays a role in determining the allocation
of jurisdiction when it comes to the enforcement of arbitration agreements.
Outside of the United States, however, each jurisdiction has a different
approach to those issues. The allocation of jurisdiction between arbitral tribunals
and courts seems to vary according to each country’s definition and application
of the Competence-Competence principle, to their approach to the enforcement
of arbitration agreements, as well as to their domestic legislation.
The present essay will examine the Brazilian approach to the gateway issues
defined by Professor Bermann—a concept with which Brazilians are not
* Camila Macedo Simão is a Senior Associate at Pogust Goodhead and Columbia LL.M
graduate. Elora Neto Godry Farias is an International Associate at Milbank LLP and Columbia
LL.M graduate. The views presented in this essay are the authors’ solely and in no way represent
Pogust Goodhead’s, Milbank’s or their clients.
127
familiar—based on an analysis of thirty five decisions rendered by (1) the

Superior Court of Justice, (2) state courts of Sao Paulo, Rio de Janeiro, Minas
Gerais, Paraná and Rio Grande do Sul and (3) federal courts from the south and
southeast of Brazil (while these state and regions seat the main arbitral
institutions in Brazil, it should be noted that arbitration is significantly growing
in the north, northeast and center of the country). This analysis originated
from a research project coordinated by Professor Bermann on the deference
given by different national courts to jurisdictional issues prior to the constitution
of an arbitral tribunal. The analysis also used as a basis a report by the Brazilian
Arbitration Committee (CBAr) and the Brazilian Association of Students in
Arbitration that looked at all decisions rendered by the Superior Court of
Justice between 2008 and 2015 and identified sixty-three decisions regarding
the existence, validity or effectiveness of arbitration agreements.
II. BRIEF OVERVIEW OF THE ARBITRATION LEGAL FRAMEWORK IN

BRAZIL
Arbitration in Brazil is governed by a combination of domestic laws and

international treaties and conventions, including mainly the Brazilian Arbitration
Act (BAA), the 2015 Code of Civil Procedure and the United Nations Convention
on the Recognition and Enforcement of Foreign Arbitral Awards, New York,
10 June 1958.
The BAA expressly recognizes the autonomy and independence of the
arbitration agreement (in relation to the main contract). Article 8 of the BAA
provides that an arbitration clause included in a contract “shall be treated as
an agreement independent of the other terms of the contract.” Further, if the
contract is found to be null and void, said finding shall “not entail ipso jure the
invalidity of the arbitration clause.” Article 8 also recognizes the Competence-
Competence principle. According to its sole paragraph, arbitrators have
jurisdiction to decide ex officio or at the parties’ request, challenges regarding
“the existence, validity and effectiveness of the arbitration agreement, as well
as the contract containing the arbitration clause.” While there seems to be no
consensus among Brazilian scholars regarding the effects of the Competence-
Competence principle, the Superior Court of Justice (S.T.J.) has predominantly
applied the negative effect of the Competence-Competence principle strictly.
However, the S.T.J. will admit that courts recognize the invalidity, inexistence
or ineffectiveness of an arbitration agreement before the arbitrators, if the
court finds, through a prima facie analysis, that the defect that taints the
arbitration agreement is manifest (S.T.J., REsp No. 1.699.855-RS, 01.06.2021).
It is fair to say that the Brazilian Judiciary is pro-arbitration since its interference
in the institute is minimal and limited to the hypothesis provided in the
Brazilian Arbitration Act. If there is an arbitration clause and there is an
objection to the commencement of arbitration, the interested party may
request that the other party be served with process to appear in court so that
THE “GATEWAY” ISSUES IN BRAZIL: A TRIBUTE TO GEORGE A. BERMANN 129
the submission agreement is drawn up. Most of the time, the Judiciary intervenes
when it needs to intervene without jeopardizing the efficiency of the proceeding.
It should also be noted that there are still no express judicial decisions that
vacated an arbitral award for disregard of the law, or reviewed the merit as we
see in U.S. Court decisions. There are a few Brazilian scholars that argue that a
violation of public policy would create grounds for annulment, considering
that the BAA provides that parties can choose the rules of law applied to their
arbitration, provided that there is no violation of public policy, and the S.T.J.
will not ratify a foreign award that also violates public policy.
For the purposes of clarity, this essay will mirror Professor Bermann’s
analysis to the extent possible. This section will be divided in the following
manner: (A) arbitrability issues, (B) challenges to the existence of the main
contract, (C) questions related to the “scope of the arbitration,” (D) “procedural
questions that grow out of the dispute and bear on its final disposition,” and
(E) party autonomy in the definition of gateway issues.
A. Arbitrability
Following Professor Bermann’s chronological order, the first point of our

scrutiny will be arbitrability. Article 1 of the BAA provides that “Those who are
capable of entering into contracts may make use of arbitration to resolve
conflicts regarding freely transferable property rights. Paragraph 1. Direct and
indirect public administration may use arbitration to resolve conflicts regarding
transferable public property rights.” Hence, the BAA makes it clear what can
be submitted to arbitration and what cannot.
We analyzed six cases that dealt with arbitrability in which the courts
examined whether the disputes were in fact arbitrable (S.T.J., REsp No.
606.345-RS, 08.06.2007; S.T.J., REsp No. 1.277.725-AM, 03.18.2013; S.T.J.,
REsp No. 904.813-PR, 10.20.2012; S.T.J., REsp No. 1.186.389-RS, 07.11.2016;
T.R.F.3., AC. No. 0022469-69.1991.403.6100, Interlocutory Decision of June 2018;
T.R.F.2, AC No. 0005966-81.2014.4.02.5101, 05.08.2014 and 05.13.2015). In
three cases, the courts found the disputes to be arbitrable (where the agreement
was executed by mixed-capital companies exploiting the economic activity of
production or trading of goods or provision of services; where the assignment
of property rights over credits arising out of a lawsuit was considered of a
fundamentally commercial and disposable nature; and where the maintenance
of the economic-financial balance of the contract was considered of a monetary
nature). In the other three cases, the disputes were found to be inarbitrable (in
cases involving bankruptcy, malfeasance, and imperative acts of the executive
branch). This means that arbitrability could be considered a gateway issue and
will be analyzed by courts prior to the arbitral tribunal.
B. Challenges to the Existence of the Main Contract
As noted above, Brazil recognizes the separability principle. However,

Brazilian courts are not always clear in determining the consequences of
examining challenges to the existence and validity of the main contract or to
the arbitration clause.
In our research, one case dealt with a claim brought on the grounds that a
contract containing the arbitration clause was null or did not exist (S.T.J., REsp
No. 1.699.855-RS, 06.06.2021). The S.T.J found that the arbitration clause was
autonomous with respect to the underlying contract and any nullity, or legal
inexistence of the main contract had no repercussion on the arbitration
agreement. Additionally, the declaration of nullity of the main contract was a
matter to be decided by the arbitral tribunal.
Two decisions involved the existence of the arbitration agreement (S.T.J.,
REsp No. 1.569.422-RJ, 04.26.2016; S.T.J., Ag No. 9.889.313-AM, 04.24.2008).
In both cases, the S.T.J. carried out a prima facie analysis of the arbitration
clauses. In one case, the court recognized the existence of the arbitration clause—
notwithstanding it being written in a separate document and without the
signature of the counterparty—finding that the tacit manifestation of unequivocal
consent is enough to consider the clause as existing. In the other case, the court
considered the clause non-existent because the parties had not signed it.
One case analyzed unconscionability issues (one of the parties had allegedly
unequal bargaining powers and lacked understanding of the arbitration clause)
and one case analyzed the forgery of a signature in an agreement containing
an arbitration clause (S.T.J., REsp No. 1.311.597-MG, 10.09.2012; S.T.J., REsp
No. 1.550.260-RS, 12.12.2017). In both cases, the S.T.J found that the arbitration
clauses were not manifestly invalid, ineffective or nonexistent. Therefore, the
courts declined jurisdiction, finding that these issues should be decided by the
arbitral tribunal.
Out of the seven cases that dealt with what Brazilian courts have addressed
as validity issues (S.T.J., RE No. 933.371-RJ, 09.02.2010; S.T.J., AREsp No.
1.845.956-MT, 08.17.2021; S.T.J., REsp No. 1.327.619-MG, 08.20.2013; S.T.J.,
REsp No. 1.602.076-SP, 15.09.2016; REsp No. 1.278.852-MG, 05.21.2013; S.T.J.,
REsp No. 712.566-RJ, 08.18.2005; T.J.R.S, A.C No. 70032734063, 02.10, 2010),
the arbitration agreements were recognized as valid in five of them: in three
cases, the court found that the validity objection should be examined by the
arbitral tribunal and in two cases (regarding arbitration agreements concluded
before the enactment of the BAA in 1996), the court analyzed whether the
clauses would be valid or not. The two cases in which the arbitration clauses
were considered to be manifestly invalid dealt with accession and consumer
contracts.
One case involved a pathological clause providing that disputes should be
decided by the courts or “by the Arbitral Tribunal of the International Chamber
of Commerce for Arbitration” (T.J.R.J., A.C. No. 0018212-97.2015.8.19.0209,
12.17.2020). In said case, the state court of Rio de Janeiro found that this clause
was manifestly pathological. In another case judged by the state court of São
Paulo (T.J.S.P., A.C. No. 1005577-98.2016.8.26.0286, 04.19.2017), the parties
had concluded an “empty” arbitration clause that only provided that disputes
had to be submitted to arbitration. It did not indicate the institution responsible
for the administration of the procedure or other rules for the institution of
arbitration. Among other issues, the state court of Sao Paulo found that the
issue of nullity of the arbitration clause should be decided by the arbitral tribunal
(the respondent had already initiated arbitral proceedings at the institution it
considered to be adequate).
C. The “Elusive” Scope of Arbitration Questions
Article 4 of the BAA provides that “An arbitration clause is an agreement

by which the parties to a contract undertake to submit to arbitration any disputes
that might arise with respect to that contract.” The objective and subjective
scope of the arbitration agreement is, thus, defined by the parties’ intent as to
what/who the agreement covers.
We have examined two cases that dealt with the objective scope of the
arbitration clause (S.T.J., REsp No. 1.656.643-RJ, 04.09.2019; S.T.J., CC No.
151.130-SP, 11.27.2019). In one case, the court found that the determination
of the scope of the arbitration clause fell within the Competence-Competence
principle, and a logical-temporal preference should be given to the arbitral
tribunal for the interpretation as to the limits of the arbitration agreement.
Such understanding would not apply only in very extreme situations where
pathological arbitration clauses are detected. In a more recent case, the S.T.J.
decided that, among other issues, a dispute brought by shareholders did not
fall within the scope of an arbitration clause included in the company’s bylaws.
When it comes to challenges concerning non-signatories, the seven decisions
analyzed indicate that there is no clear standard as to the degree of review that
is applied by courts—other than a review without a taking of evidence phase. It
seems that the degree of review adopted in such cases will vary from case to
case. In these analyses, the S.T.J. tends to look not only at the specific facts of the
case, but also to prior case law (S.T.J., REsp No. 1.948.327-SP, 09.14.2021; S.T.J.,
REsp No. 1.733.370-SP, 06.26.2021; S.T.J., REsp No. 1.727.979-MG, 06.12.2018;
S.T.J., REsp No. 1.698.730-SP, 09.08.2018; S.T.J., REsp No. 1.834.338-SP,
01.09.2020; S.T.J., AgInt no AREsp No. 976.218-SP, 17.06. 2019; T.J.S.P, AI
No. 0304979-49.2011.8.26.0000, 08.04.2002). Interestingly, none of the decisions
mentioned the “manifest defect” standard and in all of them, the cases were
submitted to arbitration.
D. “Procedural Questions that Grow Out of the Dispute and Bear on Its
Final Disposition”
The fourth section will address what the United States Supreme Court
referred to as “procedural questions that grow out of the dispute and bear on its
final disposition,” (Howsam v. Dean Witter Reynolds, Inc., 537 U.S. 79 (2002))
which can include (1) time limits for invoking an arbitration agreement,
(2) waiver of the right to invoke arbitration, (3) failure to satisfy preconditions
to arbitration, (4) res judicata, and (5) an assertion that class action arbitration
is barred.
1. Time limits for invoking an arbitration agreement
In the context of invoking an arbitration agreement, time limits may refer

to statutes of limitations or to contractual limits built into the arbitration
agreement. With regard to statute of limitations, the general time periods for
raising a claim in Brazil are set forth in the Brazilian Civil Code. They are
considered a question of substantive law that has operative elements governed
by specific procedural rules. It is also worth noting that under article 192 of
the Brazilian Civil Code, the parties cannot contractually alter the statute of
limitations periods. As for time limits provided in the arbitration agreement,
such a provision would be allowed under the autonomy of the parties.
In the scope of our research, we were unable to identify any court decisions
that expressly examined whether time limits for invoking the existence of an
arbitration agreement should be decided by the courts instead of referring
such issue directly to the arbitrators.
2. Waiver of the right to invoke arbitration
Article 20 of the BAA provides that challenges to the nullity, invalidity or

ineffectiveness of the arbitration agreement must be raised by the challenging
party at the first opportunity after the commencement of the arbitration.
Further, article 337, X, §§ 5 and 6 of the Code of Civil Procedure establishes that,
before discussing the merits of a case in the Judiciary, failure, by the defendant,
to raise the existence of an arbitration agreement, results in the acceptance of
state jurisdiction and waiver of arbitration.
We have analyzed four decisions in which the parties resisting the courts’
jurisdiction had commenced prior judicial proceedings or did not raise the
existence of an arbitration agreement as a preliminary issue (S.T.J., REsp
No. 1.678.667-RJ,11.06.2018; S.T.J., REsp No. 1.894.715-MS, 11.17.2020,
T.J.MG., A.C. No. 1.0702.10.001813-5/001, 10.27.2012; T.J.MG., A.C.
No. 10027040055850001, 09.08.2011). In all cases, the courts conducted a full
review of the issue of waiver instead of submitting it to the decision of the
arbitrators. Where the action filed before the courts falls outside the scope of
the arbitration agreement or deals with an inarbitrable issue, however, said

action will not amount to a waiver of the arbitration agreement.
3. Failure to satisfy preconditions to arbitration
Preconditions in the arbitration agreement may include the exhaustion of

any remedies, such as conciliation or mediation. In Brazil, preconditions are
often associated with a multi-tiered clause providing for mediation prior to
arbitration. Article 23 of the Brazilian Mediation Law provides that if the
parties, in a contractual mediation provision, agree not to initiate arbitral or
judicial proceedings for a particular time or until certain condition is satisfied,
the arbitrator or the judge shall suspend the proceedings for the agreed time
period or until the condition is satisfied.
In our analysis, we identified one decision from the S.T.J. that has dealt with
multi-tiered clauses. The lower courts analyzed the argument that the dispute
would have to be first submitted to mediation prior to arbitration, pursuant to
the contractual clause agreed by the parties. The S.T.J. decision confirmed the
understanding of the lower courts to dismiss the argument that the dispute
should be submitted to arbitration, because the parties had had the opportunity
for a conciliation hearing and it had been unsuccessful (S.T.J., AREsp No. 628.731-
SP, 08.22.2016).
4. Res Judicata
Article 337(VII) sets forth that, before a merits analysis, it is up to the

defendant to allege res judicata. According to paragraphs 2 and 4 of such article,
res judicata occurs when claims that have been decided by a final judgment is
brought again. Actions are considered identical when they have the same parties,
cause of action and claim.
The S.T.J. has dismissed an action that sought to challenge contractual
clauses because the challenging party had already filed a previous action
challenging the same contract and there had already been a final judgment
concluding that any claims arising out of said contract should be referred to
arbitration (S.T.J., AREsp No. 421.522-RJ, 03.30.2020). We did not identify
decisions in which the merits of a dispute that a party sought to submit to
arbitration had already been finally decided.
5. Assertion that a class action is barred
Class arbitrations are a novel issue in Brazil and they are not regulated.
Professor Bermann argues that the issue of whether a dispute can be submitted
to arbitration is a gateway issue, as it goes primarily to the arbitration agreement.
We have only identified one public decision that has indirectly addressed
the admissibility of a class arbitration (T.J.S.P., Ação Declaratória No. 1016781-
47.2018.8.26.0100, 07.04.2018). The 6th Civil Court of São Paulo had to analyze
whether a civil class action brought by an entity representing a group of

shareholders should be submitted to arbitration given the existence of an
arbitration clause in the company’s bylaws. The court found that while the
entity was separable from its associates (the actual shareholders), the entity
was merely a vehicle through which their claims could be asserted. The court
therefore ruled that the dispute should be submitted to an arbitral tribunal and
noted that the entity could not be used as a shield to exempt shareholders from
complying with the arbitration clause contained in a company’s bylaws. While
the court made no reference to class arbitration, by finding that a claim brought
as a civil class action by an entity representing a group of shareholders had to be
submitted to arbitration, its decision originated the first-class arbitration in Brazil.
E. Party Autonomy in Determining Gateway Issues
The last section deals with the possibility of the parties themselves
determining in the arbitration agreement if certain issues should be considered
gateway or non-gateway. Professor Bermann notes that while parties should
be free to agree to consider a non-gateway issue as a gateway issue, agreeing
that a gateway issue should be treated as a non-gateway issue would be more
complicated.
The Supreme Court of the United States has recognized that, pursuant to
party autonomy, the parties are free to “delegate” the determination of gateway
issues to the exclusive authority of the arbitrators. US courts have often found
that incorporating by reference a set of institutional rules that confer jurisdiction
to the arbitral tribunals to rule on their own jurisdiction would amount to a
delegation.
We have not identified a similar discussion in Brazilian case law. As noted
above, the BAA establishes that arbitrators have jurisdiction to decide ex officio
or at the parties’ request, challenges regarding the existence, validity and
effectiveness of the arbitration agreement or the underlying contract. Further,
in principle, the S.T.J. predominantly applies the negative effect of the
Competence-Competence doctrine in a strict manner.
In several of the cases we have analyzed, the arbitration agreement
incorporated institutional rules that provide that the arbitrators have jurisdiction
to rule on their own jurisdiction. Nonetheless, the question of delegation has
not come up.
III. CONCLUSION
This essay sought to analyze how Brazilian courts address gateway and
non-gateway issues and consider whether it would be possible to identify a
Brazilian approach to these issues.
As a rule, the S.T.J. understands that challenges to the invalidity, inexistence
or inoperativeness of arbitration agreements shall be decided first by the
arbitrators, unless a court finds, prima facie, that the defect that taints the
arbitration agreement is manifest. However, as evidenced above, exceptionally
certain decisions involving waiver of the right to invoke arbitration, non-
signatories, res judicata and class arbitration will be subject to closer scrutiny
by Brazilian courts instead of referring such questions directly to the arbitral
tribunal.
Notwithstanding these exceptions, the degree of review does not reach the
level of the full review carried out in the United States, for example, and, in
general, the S.T.J. decisions tend to be more deferential to future arbitrators,
rarely resulting in a denial of enforcement of the arbitration agreement.

Chapter 21
ARE THE ESSENTIAL ACTORS AND USERS OF
ARBITRATION PRO‐ARBITRATION?
Camilla Gambarini*
I. INTRODUCTION
Courts and legislators play an important role in ensuring that international

arbitration remains pro-arbitration. However, this does not detract the “essential”
actors of international arbitration from having a key role in ensuring the
legitimacy and efficiency of the “international arbitration enterprise.”
It may be an uncontroversial question asking whether an arbitrator is pro-
arbitration given that the scope of his or her role is to “serve” the interest of
those parties that have decided to solve a dispute through arbitration as
opposed to recurring to domestic courts. The same applies to counsel who has
the key role of representing, defending, and guiding parties in international
arbitration proceedings. However, there may be circumstances where these
actors do not act in a pro-arbitrator fashion or in a manner that they are usually
expected to adopt.
Through international arbitration, parties resort to private justice as
opposed to national courts to solve a dispute. Although such a decision should
be thought through, there are still instances where contract signatories include
an arbitration clause without having a full understanding of its effect on a potential
dispute. This approach should be avoided. However, it may happen that
“unsophisticated parties”—which represent a considerable component of the
users of international arbitration—result in being involved in international
arbitration proceedings without knowing the effect of having designated a seat
in an arbitration clause, for example. This may beg the question as to whether
users of international arbitration are pro-arbitration if they are not familiar
with it and its features in the first instance.
Aside from this far from uncommon situation, the very raison d’être of
international arbitration is respecting the will of the parties as well as rendering
justice, maintaining flexibility and efficacy. Both counsel and arbitrators involved
in international arbitration proceedings respect and follow this mantra that
encompasses different aspects, including, among others, independence and
impartiality of arbitrators, technical knowledge to deal with certain types of
disputes, familiarity with a specific country, industry, legal system, or language.
* Camilla Gambarini, LLM Columbia Law School (2014), is a Senior Associate at Withers
(London). This essay reflects only the views of the author and does not reflect the views of
Withers or Withers' clients.
137
In other words, it is expected that both counsel and arbitrators act pro-
arbitration. However, the everyday life of any arbitration lawyer may rather
prove that this is not always the case.
II. PROCEDURE
Flexibility and efficacy in international arbitration often imply that arbitrators

and counsel adopt an international approach as parties may not want to have
their dispute anchored to the procedure and practice of a specific legal system.
However, arbitrators and counsel are lawyers coming from a certain legal
tradition and, in practice, it may happen that they rely on the procedure of their
“legal system of origin” applying it to international arbitration proceedings.
One of the early moments in international arbitration proceedings that
may reveal whether counsel and/or arbitrator have a pro-arbitration approach
is the Case Management Conference (CMC) or first hearing. This corresponds
to the moment where counsel (and the parties) has the opportunity to “meet”
the arbitral tribunal for the first time and discuss procedural aspects of the case,
which are then recorded in procedural order number one. Although the scope
is to achieve flexibility and efficiency, there may be situations where the essential
actors of arbitration prefer following—intentionally or unintentionally—
procedural practices of their “home jurisdiction.”
For example, even in the context of international proceedings involving
parties from different civil law jurisdictions, counsel may request the parties
to follow an English litigation approach when filing written pleadings because
the arbitral tribunal is seated in London or English law applies to the dispute,
for example. This implies that the parties would file their written pleadings with
factual exhibits, but witness statements and experts report would come in
separate stages of the proceedings. Similarly, in the USA, counsel may handle
document production requests similarly to discovery in civil litigation proceedings
before U.S. courts.
Arguably, such approaches would defeat the rituals of international
arbitration. As the late Professor Gaillard wrote, “actors belonging to the same
social field, international arbitration players have developed specific rituals,
which structure the manner in which they are expected to behave during key
moments of their social life” (Sociology of International Arbitration, 2015).
In the case of international arbitration, there are certain rituals or–better
practices—that all arbitration actors are expected to follow
The expectation or ritual in this case is that, in international arbitration,
pleadings are filed together with factual exhibits, legal authorities, witness
statements, and expert reports. Equally, in document production, the rule—
being more than a ritual or an expectation—is that a Redfern Schedule is used
and a hybrid approach between the common law and the civil law is used.
While these approaches may not be unfair or unlawful per se, they would
defeat the purpose of parties that expect to have a flexible procedure not

ARE THE ESSENTIAL ACTORS AND USERS OF ARBITRATION PRO-ARBITRATION? 139
connected to the rigid procedural rules of a specific legal system. This procedural
approach would, therefore, be considered not “pro-arbitration.”
III. GUERRILLA TACTICS
The term guerrilla tactics encapsulates instances in which parties and/or

counsel do not hesitate to obstruct the arbitration proceedings.
Guerrilla tactics may take different forms in different stages of the
proceedings. They include, among others, threatening to publish documents in
order to harass a witness, instigating a criminal investigation against a key
witness, advancing client or personal health concerns although they were not
true, using Covid-19 as an excuse to delay proceedings or postponing hearings
to avoid them online, not producing documents that are otherwise responsive
to document requests, or enacting extensive fishing expeditions. These tactics
cannot be reasonably considered pro-arbitration. However, in many situations,
parties and counsel are the ones strategizing, mastering, and implementing
guerrilla tactics.
In the context of guerrilla tactics, it can be particularly challenging for an
arbitrator to be efficient. When confronted with such tactics, an arbitrator will
have to pay particular attention to moving the proceedings forward and not
wasting time. This will often require firm decisions by the arbitrators, whilst
ensuring that due process as well as efficiency of the arbitration proceedings
are respected. The IBA 2013 Guidelines on Party Representation in International
Arbitration and the LCIA General Guidelines for the Authorised Representatives
of the Parties are important initiatives that highlight the hurdles that are often
encountered in practice when parties or counsel act in a manner against the
purpose of arbitration.
IV. DIVERSITY
There are numerous studies that support the view that diversity is key for
the success of a company. In international arbitration, it is even more the case
particularly as parties come from different countries, the applicable law to the
dispute is not connected to any of the parties involved in the dispute, and the seat
of the arbitration may connect the dispute to another jurisdiction. Moreover,
international arbitration is possibly one of the few disciplines where social
awareness, cultural and political sensitivity, knowledge of foreign languages, and
different legal systems are decisive factors that parties expect both arbitrators and
counsel to master as a second nature—in addition to the obvious knowledge
of the law.
Thus, ensuring that a tribunal is composed of diverse arbitrators in terms
of, among others, gender, age, race, nationality, national origin, sexual orientation,
religion, and disability, is key to the success of international arbitration and
the best outcome for the parties in dispute. As Professors Duggal and Lee said,
“[d]iversity is therefore key for the symbolic legitimacy of the arbitration

process since there is a perception that the ‘pale, male and stale’ profile may
be encouraging a certain world view of disputes” (A 360‐Degree, Kaleidoscopic
View of Diversity and Inclusion (or Lack Thereof) in International Arbitration,
ARIA).
In recent years, the international arbitration community has focused on
diversity in international arbitration. Several institutions, organizations, and
initiatives have been created around it within the international arbitration
community, such as, among others, the ERA Pledge, Arbitral Women, the Racial
Equality for Arbitration Lawyers, the Rising Arbitrators Initiative, and the new
International Chamber of Commerce (ICC) Disability and Inclusion Taskforce.
Yet, diversity is still an issue in international arbitration, and it has not been
fully solved, although some progress has been made.
Arbitral institutions are often involved in fostering diversity when appointing
arbitrators if they are tasked to do so. Counsel may not always follow this
approach, continuing with the appointment of “usual suspects” to ensure more
certainty. The users of arbitration, mainly the parties, may have an important
role in this respect. It is becoming common for companies to ask counsel
diversity statistics not only in relation to the composition of the counsel team,
but, crucially, as well as of arbitrators appointed in recent cases.
These initiatives imply that users of arbitration, namely parties, consider
that arbitrators or counsel who are not diverse or have a minimal appreciation
of diversity may not be considered to be pro-arbitration.
V. CONCLUSION
The previous short examples show that the essential parties and users of
international arbitration may act in a way that defeats the purpose of
international arbitration.
To maintain the legitimacy and success of international arbitration, its
essential actors and users should consider carefully the reasons underlying the
decision to have a dispute resolved through private justice without resorting
to domestic courts, and respecting such a choice by implementing decisions
and adopting actions that are pro-arbitration.

Chapter 22
WHAT DOES IT MEAN TO BE “PRO-
ARBITRATION?” OVERCOMING THE
“PRO-STATE” V. “ANTI-STATE” DICHOTOMY IN
SOVEREIGN DEBT DISPUTES
Carla Martini*
When reading Professor Bermann’s piece “What Does it Mean to be ‘Pro-

Arbitration’?”, the first thing that comes to mind is the well-known dichotomy
between investors and States’ interests underlying investment arbitration
disputes. Why do we continuously think about investment arbitration being
“pro” or “anti” State? Numerous arguments have been made that international
arbitration institutions have been built, and rules have been created and
enforced by a handful of stakeholders typically from developed countries, in
detriment or disregard of the developing world, which ultimately leads to an
unequal and inequitable arbitration system. While I tend to support this view,
Professor Bermann’s piece also makes me believe that some rules (or forums)
may distinctly serve States’ or investors’ well-being in some respects, “while
equally distinctly disserving it in others” (Bermann: 2018). Hence, when creditors
(or investors) seek to enforce contractual obligations arising out of sovereign
debt bonds or instruments against a defaulting State, creditors have until
recently only resorted to domestic courts instead of investment arbitration –the
usual suspects found in sovereign debt instruments being New York or London.
This piece intends to unravel in a few words some of the various nuances that
may arise from having a “pro-arbitration” or “anti-arbitration”, versus a “pro-
State” or “anti-State” view when resolving sovereign debt disputes, supporting
Professor Bermann’s view that a single policy or practice’s “friendliness to
arbitration” must not be examined through a narrow lens (Bermann: 2018).
Historically, investment arbitration has not been the first choice of forum
for sovereign debt creditors seeking to enforce their contractual obligations vis
a vis the State. This could be due to the fact that creditors are typically a dispersed
group (usually hedge funds and investment management companies) that
have little or no incentive to allocate their time and resources to appoint their
arbitrator, which would entail consolidating a position through majorities as
* Carla Martini is an L.L.M. Graduate from Columbia Law School (2020) and currently is an
Associate at Cleary Gottlieb Steen & Hamilton, LLP’s Latin-American practice in New York. Prior
to joining Cleary, the author worked as a legal advisor for the Argentine Government in trade
and investment treaty negotiations, as well as in international tribunals in The Hague and in the
energy and arbitration practice of Pérez Alati, Grondona, Benites, Arntsen & Martínez de Hoz (h)
in Argentina. The views expressed here belong only to the author.
141
set forth in the documents governing the debt instruments, as well as agreeing
with the State in the appointment of a third arbitrator. It would be also unusual
(though not impossible) that the trustee under the debt instruments would have
incentives to take the lead on this task. Some commentators have also argued
that the preference for creditors to resort to domestic courts could relate to the
fact that the forum provisions in debt instruments have been duplicated and
standardized throughout market practice, and not so much because of the merits
of domestic litigation versus international arbitration (Halverson Cross: 2006).
However, investment arbitration has not been a State’s most favorite forum
either. Argentina, for instance, has been subject to more than sixty claims from
investors arising out of Bilateral Investment Treaties (BITs), and has therefore
become one of the most active players in the investment arbitration system.
Numerous arguments have been made on the inequality and inequitable
character of the international arbitration system in terms of its rule-making
and decision-making processes. However, as Professor Bermann depicts, some
rules may distinctly serve States’ or investors’ well-being in some respects,
“while equally distinctly disserving it in others.” So why should a State or
investor be “pro” or “anti” arbitration, or why should investment arbitration
be conceived as “anti-State” if a creditor seeks to resort to this forum?
Let’s talk about enforcement first. Early in 1998, the International Centre
for Settlement of Investment Disputes (ICSID) tribunal in Fedax v. Venezuela
considered that sovereign bonds qualified as an “investment” under the
Netherlands-Venezuela BIT, and the more recent Abaclat v. Argentina precedent
shows that creditors, through the States’ contractual obligations under a BIT,
may resort to international investment arbitration to pursue a recovery of
their investments in the host state. When seeking enforcement, an ICSID award
for instance can be enforced directly in the courts of States members to the
ICSID convention “as if it were a final judgment of a court in that State”. But
why would investors shift gears completely and seek recovery in investments
forums where jurisdictions like New York have been usually creditor-friendly
in the enforcement of debt instruments obligations and in the attachment of
sovereign assets? And would international arbitration be completely
disadvantageous for the State, considering it may (depending on the
jurisdiction) invoke immunity defenses in connection with the attachment of
sovereign assets? Perhaps the answer would be “yes” if we consider the fact
that the State would have to defend itself “twice” (once in the arbitration forum,
and the other invoking sovereign immunity defenses in the domestic court),
but this could also be interpreted as a disadvantage for the creditors, which
would also need to battle against sovereign defenses in different forums.
Now let’s consider fairness in the outcome or type of recovery. Some
commentators may argue that investment arbitration under a BIT would allow
creditors to obtain a full recovery of their investment, whereas domestic
jurisdictions could leave more room for sovereigns to negotiate the amount of
their debt through settlements. In this sense, creditors may think they are
WHAT DOES IT MEAN TO BE “PRO-ARBITRATION?” 143
“losing” the nominal value of their debt instruments, and could conceive
investment arbitration as a way to seek a full recovery that could be “easily
enforceable”. However, a State could easily try to settle and reduce the amount
of the claim in an investment arbitration forum—in fact, one could say that
some arbitrators (or better put, the arbitrator sitting in the tribunal that was
chosen by the State) could be more prone to consider a State’s interests (such
as preserving financial and social stability) than a domestic court judge. In
other words, some may argue that an arbitrator would be more prone to “split
the difference” or balance the interests of the State and the creditors than a
domestic court judge, and thus a State will be more willing to comply with an
ICSID award rather than with a judgment rendered in a foreign domestic court
(Halverson Cross: 2006), in addition to the greater transparency and neutrality
that characterizes the intrinsic nature of international arbitration.
Relatedly, the publicity arising out of litigating a sovereign debt dispute in
a domestic forum is usually beneficial for the creditors, as it generates substantial
pressure on the State to reach a settlement with the creditors for the repayment
of its defaulted obligations. In this sense, the State could benefit from the
confidentiality of the arbitration proceedings, as this would prevent the
dissemination of detrimental information to the public.
All the above intends to portray examples echoing Professor Bermann’s
view that international arbitration policy and decision-making consists of
constant trade-offs, and that looking at a system or policy as being “pro-” or
“anti-” investor or States is not the best position to take when trying to expand
the use of and confidence in the international disputes system. In fact,
Professor Bermann depicts a simple but utmost accurate premise all practitioners
should consider when navigating the challenging yet thrilling waters of
international disputes: “[t]he efficacy of arbitration depends on the attitude of
others.” It would be unrealistic to try to arrive to a scenario where the interests
(or attitude) of States and investors or creditors are aligned. However, once
both parties are immersed in a dispute, they certainly want their interests to
be recognized in a way they consider to be legitimate, and will adopt a
particular “attitude” with a view to achieving such an objective.
We are seeing a rapid proliferation of new voices and participants in the
international arbitration arena, including a steep increase in diversity of gender,
race and nationality in the composition of arbitral tribunals, public international
law rules permeating into BITs and trade agreements, and arbitration rules
and international treaties including human rights obligations. And (without the
intention of falling into the “pro-” or “anti-” arbitration dichotomy), one could
argue that one of the great advantages of resorting to international arbitration
vis a vis domestic courts is its flexible and dynamic nature that allows constant
and rapid evolution, as opposed to more rigid, politicized and culturally rooted
domestic institutions that sometimes (and even more in developing countries)
leave less room for these new voices to appear. So perhaps (and why not?)
those who have the privilege to participate in the international investment law
and arbitration rule-making and decision-making processes (and even lawyers

drafting sovereign debt instruments) could consider these unique aspects of
arbitration and the nuances that a particular policy may intertwine, and seek
to further expand this practice to sovereign debt disputes.
It is an honor to be able to participate in Professor Bermann’s tribute. His
contribution to the arbitration community has been and will be a legacy for all
young (and not too young) practitioners and academics for the years to come.
Chapter 23
CLARITY, TRANSPARENCY AND
UNAMBIGUOUSNESS: THE PRO‐ARBITRATION
SINE QUA NON
Chiara Cilento and Rodolfo Donatelli*
In reflecting about Professor Bermann’s legacy, one cannot help but think
of all of the law students that he has inspired to become international arbitration
practitioners. Every year, swaths of Columbia Law School students enroll in
the various courses on international arbitration held by Professor Bermann.
And we ourselves have been lucky enough to attend International Commercial
Arbitration, the International Arbitration Practicum and Investment Law and
International Arbitration.
International arbitration is a fascinating practice. Many law students fall
in love with it when they first learn about it, inspired by its internationality and
its relevance on international affairs. Many students are also fascinated by the
international arbitration community, which encompasses inspiring practitioners
from all over the world. However, in falling in love with the practice, it is easy
for law students to become too wielded by it, and start considering themselves
as “pro-arbitration,” without giving too much thought about what that actually
means, and what its implications are.
One of Professor George Bermann’s greatest teachings is the important
responsibility that comes with being an active member of the international
arbitration community, and how the community itself shapes international
arbitration policy and international arbitration as an alternative system to resolve
disputes. As we have seen in many jurisdictions, arbitration practitioners are
often called to help draft the lex arbitri of that jurisdiction, in the hope of
improving it for the ultimate goal of attracting foreign investment, helping relieve
the burden of litigation on courts or simply giving its citizens the freedom to
decide who will settle their disputes and how. Other times arbitration scholars
and practitioners carry out the important role of articulating the principles and
rules of arbitration in the aid of courts compelling arbitration and deciding on
the enforcement of arbitration awards, as Professor Bermann has done with
the Restatement of the United States Law of International Commercial and
Investor-State Arbitration. Other times again, the international arbitration
community is called to draft guidance in the form of soft law which becomes
extremely relevant in shaping the international arbitration process, such as the
* Chiara Cilento, LL.M. ’17, is a Senior Associate at Herbert Smith Freehills LLP in New York.
Rodolfo Donatelli, J.D. ’19, is an Associate at Latham & Watkins LLP in New York.
145
International Bar Association (IBA) Rules on the Taking of Evidence, Guidelines

on Conflicts of Interest, as well as others.
In light of the fundamental role of the international arbitration community,
it is of utmost importance for every international arbitration practitioner to
think seriously about what being “pro-arbitration” exactly means.
As Professor Bermann states in his article:
[T]he international arbitration community must strive to ensure that, in

addressing the concerns and pursuing the values most closely associated
with arbitration practice and its efficacy, it does not fall seriously out of
step with extrinsic values to which the legal system as a whole attaches
fundamental importance. (Emphasis added).
To us—as Professor Bermann’s former students and research assistants,

and now international arbitration practitioners—this means ensuring that due
process remains the cornerstone of international arbitration and the pole star
that needs to be followed in defining its rules. Specifically, a fundamental tenet
of international arbitration should be that the rules applicable to international
arbitration remain clear, transparent and unambiguous, so that the parties’
fundamental rights are respected. This also helps ensure that any criticism
against international arbitration be limited to constructive critiques aimed at
improving the practice, and not undermining it. Furthermore, it will ensure
the long-term legitimacy of arbitration.
In his article, Professor Bermann identifies various examples of trade-offs
that need to be taken into account when considering what it means to be “pro-
arbitration.” These include trade-offs related to interim relief in conjunction
with arbitration, the extension of arbitration agreements to non-signatories,
the use of written witness statements in arbitration, the use of tribunal
secretaries by arbitral tribunals, as well as others.
Perhaps a way to help balance these trade-offs is ensuring that the rules
applicable to arbitration proceedings are clear, transparent and unambiguous,
as mentioned above. This relates to all of the various rules applicable to
arbitration, be it the lex arbitri or the arbitration rules.
For example, in his article Professor Bermann refers to the use of tribunal
secretaries, and mentions that “[d]elineating the proper role of tribunal
secretaries likewise entails a balancing act potentially pitting economy in the
conduct of arbitration against effectuation of intention of the parties.” If a
tribunal draws a clear line in the sand as to the role of a tribunal secretary at
the outset of a proceeding, then the parties are free to agree or to object to
what exactly the tribunal secretary may or may not do. This avoids surprises at
a later stage of the proceedings, when the parties have already invested important
resources in the process, and ensures that the award is not undermined in any
way by the role assumed by the secretary.
THE PRO-ARBITRATION SINE QUA NON 147
The same principle may be applied to other procedural aspects of the

arbitration process. For example, Professor Bermann refers to witness
statements in lieu of live direct testimony and explains:
Replacing direct witness testimony with written witness statements is

largely viewed as pro-arbitration because it demonstrably saves time
and money. But the practice may also exact a pro-arbitration price
insofar as it lessens the tribunal’s opportunity to observe how the
witness presents his or her position, and raises to distinct risk that
counsel, not the witness composes the witness statement.
In this instance as well, tribunals may want to include specific rules in their
procedural orders that set out exactly what is expected by the parties with
respect to the witness evidence, including but not limited to whether witness
statements are appropriate (e.g., in domestic arbitration in certain jurisdictions).
Tribunals and arbitration rules may also want to specify, for the benefit of the
parties, the extent of counsel’s involvement in the drafting of the witness
statement, whether the witness must appear before the tribunal to confirm the
statement, the scope (if any) of any further questions asked by the tribunal,
and whether virtual witness examinations may be acceptable in the event in
which the witness is unable to travel at the hearing (assuming obviously that
the hearing is not virtual).
Clarity, transparency and lack of ambiguity may also help balance trade-
offs that are more often related to the lex arbitri. Professor Bermann identifies
as further trade-offs the availability of interim relief from a court in conjunction
with arbitration, as well as the much debated extension of arbitration agreements
to non-signatories.
Professor Bermann refers to the latter as “[a] particularly daunting example
of the conflict between the goals of arbitration.” Recent case law from the United
States Supreme Court, as well as Circuit courts, holds that in certain instances
arbitration agreements are to be extended to non-signatories. Perhaps one
way to balance the trade-off is for the lex arbitri itself to expressly enumerate
the instances in which arbitration agreements may be extended to non-
signatories. This again would help assuage any concerns or criticisms as to the
lack of clarity on the extension of arbitration agreements to non-signatories. As
pointed by Professor Bermann, although the extension of arbitration agreements
to non-signatories may be seen as pro-arbitration, it is not hard to imagine
potential pushback in certain jurisdictions—which may potentially impact how
courts extend arbitration agreements to non-signatories in such jurisdictions.
With respect to the availability of interim relief, Professor Bermann explains
that the position on interim relief in conjunction with arbitration has changed
over time. This remains an aspect of arbitration where different jurisdictions
sometimes differ, as is also shown by the differing availability of emergency
arbitration. In this instance again, clear and express provisions in the lex
arbitri may aid in striking the correct balance.
Every arbitration practitioner will appreciate that setting out clear,
transparent and unambiguous provisions is not always the most straightforward
task, and that in any event even well-defined rules provisions will not necessarily
avoid disputes as to their meaning or their applicability. Notwithstanding this
issue, striving at clarity, transparency and lack of ambiguity when it comes to
provisions applicable to the arbitration process is what it means to be “pro-
arbitration.” And Professor Bermann has always aimed at achieving this goal
through his teachings, articles, and professional activity.
Arbitration is based on consent of the parties that opt to arbitrate their
claims, and a clear set of rules will ensure that such a consent is given in a
deliberate, open eyes, manner. Professor Bermann’s legacy lives in his students,
that work every day to make sure that arbitration remains a fair process. To
be “pro-arbitration” means to ensure and defend the legitimacy of arbitration,
through the deliberate application of due process, which is the necessary medium
for a fair arbitration in a fair legal system. While the trade-offs identified by
Professor Bermann will likely continue to exist, as long as the arbitration
community continues being “pro-arbitration” by ensuring that the framework
remains clear, transparent and ambiguous, such trade-offs will hopefully be
slightly easier to balance.
Chapter 24
“IN MITAS VIRTUS”: THE NECESSARY BALANCE
BETWEEN THE DUTY TO PROTECT THE PARTIES’
PROCEDURAL RIGHTS AND THE NEED TO
PROMOTE AN AGILE AND COST-EFFECTIVE
ARBITRATION
Christian Herrera Petrus*
In honour of Prof. George A. Bermann, the best and most engaging Law
professor I ever met.
It is well known that in the conduction of arbitral proceedings, arbitrators

sometimes have to deal with complex situations as a result of the tension
between two fundamental principles that can work in opposite directions: the
duty to fully respect the parties’ essential procedural guarantees (namely the
right of defense and the principle of equality) and the need to conduct the
arbitration in an agile and cost-effective manner. This is particularly pressing
when one or both parties follow a dilatory or aggressive strategy, evidenced
by the reach with which they explore and utilize potential procedural options
(the sheer amount and extension of written pleadings, the unnecessary depth
of discovery requests, the request of questionable or superfluous means of
proof, the permanent challenge of the arbitrators’ rulings, etc.).
Without a proper protection of the parties’ procedural rights, the arbitral
award risks challenges on due process grounds and/or difficulties at the stage
of recognition and enforcement. This undoubtedly exerts a significant degree
of pressure on arbitral panels, which can understandably be tempted to tilt
towards a passive or “safe” interpretation of their role as case managers of the
arbitral proceedings by allowing most of the litigants’ petitions and actions,
even if they amount to “guerrilla tactics.”
But at the same time, arbitrators are constrained by the duty to proceed
with speed and economy. Agility and efficiency are not a mere desideratum of
the arbitral eco-system but a real obligation behooving practitioners and, in
particular, those who adjudicate disputes. The avoidance of unnecessary delay or
expense is surely imposed in many arbitral legislations (for instance, rule 33(1)b
of the 1996 UK Arbitration Act) and by the rules of many arbitral institutions
(i.e., rules 23 and 33 of AAA; article 22 of ICC; rule 14.4.2 of LCIA). And even
* Christian Herrera Petrus is a Senior Lecturer of international litigation and arbitration,
Eur.Ph.D., LL.M. Columbia, LL.M UCL, MCiarb, Abogado (Partner at Herrera Advocats), and
Arbitrator; ch@herrera-advocats.com.
149
though failing to issue an award within a reasonable time framework or

avoiding exorbitant costs may not be generally regarded as an autonomous
ground for nullification or refusal of recognition and enforcement of the award,
the duty to adhere to this obligation is today clearly backed by internal sanctions—
namely the loss of the arbitrators’ fees—and it can affect enormously the
reputation of arbitration as a valid alternative method to traditional court
litigation, as well as damage the arbitrator’s prospects in her professional career.
In the face of this dichotomy, it is commonly accepted that arbitration is
best protected and strengthened by reconciling the opposing vectors, since
protecting only one of them to its fullest expression may come at the expense
of disserving the other. In my modest view, Aristotle’s classic admonition to
pursue the highest virtue by weighing factors in order to strike a fair balance
between contraries (in mitas virtus) is, as in many facets of life, a most
recommendable practice. In effect, the best possible outcome in this scenario
lies always somewhere between the extremes. The old apothegm thus can be
followed as a pro-arbitration directive to consolidate the institutions’ current
expansion trend and growing prestige.
In order to assist arbitrators in the process of weighing opposing elements
and trying to find a balanced solution, a few relevant hints can be drawn from
practical experience and available data. As a starting point, it must be admitted
that the protection of procedural fairness is paramount to arbitration, particularly
since—unlike in the case of court jurisdiction—the controversy is adjudicated
in only one shot. To a certain degree, the parties’ leeway concerning procedural
initiatives and activities is an element inherent to the arbitral experience, which
is rooted in party autonomy and flexibility.
As indicated before, the problem arises, however, when parties make an
abusive exercise of their procedural rights aimed at overly complicating the
case or simply directed at frustrating the possibility of obtaining a resolution
of the controversy within a reasonable period of time and at a proportionate
cost. This mala fide behavior is generally seasoned with a more or less explicit
threat to challenge the award on the grounds of due process if the arbitrators
deny or oppose the questionable pretense, generating what has been labeled
in the arbitration community as “due process paranoia” and has been described
by both scholars and practitioners as a serious problem for the well-being and
reliability of the institution.
A thorough look at this phenomenon, nonetheless, leads to the conclusion
that in dealing with these scenarios, arbitrators should not be excessively
concerned about the risk of annulment or non-recognition and enforcement of
the award. Challenges to awards before national courts or legal resistance to
recognition and enforcement are not statistically frequent. Voluntary compliance
with awards is the common rule. But, even more importantly, most judiciaries
have followed a strict approach in this field of law (for example, among others,
courts in London, Stockholm, Singapore, Hong Kong and Barcelona) and allow
challenges to arbitral awards to prevail only in exceptional cases where national
“IN MITAS VIRTUS” 151
courts are satisfied that very serious violations of the right of defense, the
principle of equality or the ordre public of the jurisdiction of the place of
arbitration (or that of the State were recognition and enforcement is sought)
occurred during the proceedings, flatly discarding other alleged infringements
which are insufficiently relevant.
Therefore, arbitrators should not fear effective reprisal in most jurisdictions
if they decide to take on a more pro-active role in case-managing the proceedings
and in denying unreasonable petitions or refusing to admit requirements that
appear to be disproportionate or to put at risk an agile and efficient conduction
of the arbitration.
Beyond the duty to observe speediness and cost-efficiency provided that
can be found in many national legislations and in the rules of most arbitral
institutions—and supported by subsequent sanctions in case of default—other
arguments and factual elements seem to point in the same direction. In the first
place, one should realize that giving in to a party’s abusive request means harming
at the same time the due process rights of the party in bonis, who should not
be compelled to withstand disproportionate or costly proceedings.
In the second place, there is a lot to say in favor of the view that arbitrators
are not really under the obligation to guarantee the issuing of a generally
enforceable award. In our opinion, arbitrators cannot be reasonably expected to
be acquainted with the procedural requirements of all nations where the
award is potentially enforceable and should only care to observe the standards
applicable in the State of the arbitration’s seat, as long as those standards meet
a minimum and acceptable level of protection of the right of defence and party
equality. What those minimums should entail is left for another occasion.
Despite the foregoing considerations, it is necessary to acknowledge that
dealing with a defying situation in the form of “guerrilla tactics” is sometimes
quite difficult for an arbitral tribunal. The protection of the valuable goals of
agility and cost-efficiency, while guaranteeing at the same time a robust right
of defense and a healthy and equal battle, requires a fair amount of practical
skills and experience. No one said that the Aristotle principle was easy to apply.
To that effect, one interesting tool that adjudicators can resort to is the express
referral to or the agreed adoption of ethical codes or other similar forms of soft
law, typically addressed at the party’s attorneys (i.e., the IBA rules on the taking of
evidence abroad) in order to set out clear limits and avoid misconduct.
Another possibility in the hands of arbitral panels in their quest for balanced
proceedings is the use of preventive tools aimed at avoiding abuses from the
outset of the proceedings. These tools generally take the form of preparatory
audiences, detailed procedural orders (especially the initial one), and a well-
rounded procedural calendar, all of them being better accepted and implemented by
the parties if they have actively participated in their elaboration.
In addition, adverse inferences and endo-procedural sanctions can be
established in advance as the necessary consequences to be applied by the
arbitrators if parties fail to abide by their procedural commitments or intent
to blow up the proceedings. The exclusion of delayed pleadings, the refusal of

unreasonably aggressive petitions of means of proof or the decision to separate
the parties’ lawyers if inappropriate behavior takes place can also be set out
from the beginning as the pre-established or pre-agreed response to those
instances of abuse or procedural misconduct.
And of course, last but not least, arbitrators can make a smart use of legal
costs, which can even be imposed on the party acting in bad faith through a
partial award, as provided for in many rules of arbitral institutions and in
certain bodies of soft law. Interestingly, some scholars have drawn attention
towards the dissuasive effect, which follows from a partial award imposing
legal costs at the initial stages of the arbitral proceedings. Such an early
measure can help guarantee an adequate flowing of the arbitration and a good
attitude by the parties and their counsel, and it is entirely independent of the
resolution of the merits in the final award. If the imposition of legal costs is
chosen as a tool to prevent or curtail abuses, it seems advisable to include a
detailed explanation of the grounds upon which this decision is made, in order
to avoid or minimize the risk of challenges of the award in which it is contained.
In conclusion, in the exercise of finding the necessary balance between the
duty to protect the parties’ procedural rights and the need to ensure economy
in time and cost, arbitrators should not be deterred from adopting a proactive
role and making timely use of their powers. They can effectively ignore the
parties’ threats to challenge the award as leverage to impose abusive tactics
because objective data shows that most national judiciaries have followed
strict interpretations and will only consider vacating an award when serious
violations of procedural safeguards (right of defense, equality or public order)
have been proved.
To achieve the Aristotle optimum (in mitas virtus), a weighing process has
to be carried out, which requires both skill and experience and a fine sense of
equilibrium, especially when the proceedings are burdened with dilatory or
aggressive tactics. In this endeavor, arbitrators can resort to a handful of
practical techniques in order to try and minimize inappropriate behavior and
keep costs and time under control, while at the same time protecting fairness
and accuracy and making sure that both parties have a chance to fully present
their case.
Chapter 25
THE BENEFITS OF A JUDICIAL RE-HEARING OF
JURISDICTIONAL OBJECTIONS
Christina Cathey Schuetz*
“…if a policy or practice sufficiently enhances arbitration’s legitimacy, or at least

avoids discrediting it, that policy or practice may legitimately be regarded as in
itself decidedly arbitration-friendly, notwithstanding the fact that it makes
arbitration somewhat more costly, curtails party autonomy, invites judicial
intervention, removes a category of claims from the universe of arbitrable disputes,
or sacrifices in some other way what we traditionally associate with arbitration-
friendliness.”
- George Bermann, “What Does it Mean to Be ‘Pro-Arbitration’?”
A fundamental premise of arbitration is that the parties to a dispute have

agreed to remove that dispute from the jurisdiction of State courts. If
jurisdiction is challenged, national arbitration laws commonly accord arbitral
tribunals with competence-competence to rule on the extent of their own
jurisdiction over the matters put before them. But it is also a common feature
of national arbitration laws to authorize national courts to hear complaints
that an arbitral tribunal lacks or lacked jurisdiction in particular instances: see,
for example, UNCITRAL Model Law, articles 16 and 34(2). The court’s supervision
on the question of jurisdiction is an important check and balance to the
autonomy otherwise enjoyed by the parties and their tribunal.
A question arises as to how far a court at the arbitral seat should be able to
go in enquiring whether a tribunal has correctly concluded that it has jurisdiction
over a dispute. Is the court’s role to sense-check the tribunal’s determination
based on the facts and arguments which were put before the tribunal, or should
the court be conducting its own re-hearing of the underlying circumstances?
The former approach is consistent with promoting the efficiency of the arbitral
system. The latter arguably stands a better chance of coming to an accurate
assessment of the correctness of the jurisdictional decision, but entails greater
cost, delay and disruption.
In the English context, the orthodox view is that when it comes to
challenges of jurisdictional awards, a full re-hearing of the jurisdictional phase
of an arbitration is appropriate. Whether that is the correct approach is a
* Christina Cathey Schuetz (CLS J.D. 2007) is a Senior Associate at Clifford Chance LLP.
153
question up for debate in the context of ongoing consultations on potential

amendments to the Arbitration Act 1996.
Section 67(1) of the Arbitration Act 1996 states:
A party to arbitral proceedings may (upon notice to the other parties and
to the tribunal) apply to the court –
(a) challenging any award of the arbitral tribunal as to its substantive

jurisdiction; or
(b) for an order declaring an award made by the tribunal on the merits
to be of no effect, in whole or in part, because the tribunal did not
have substantive jurisdiction.
A party may lose the right to object (see section 73) and the right to apply
is subject to the restrictions in section 70(2) and (3).
Section 67(3) of the Arbitration Act 1996 authorizes the court hearing the
challenge to either: (a) confirm the award; (b) vary it; or (c) set it aside in whole
or in part.
The term “substantive jurisdiction” is defined in s 30(1) of the Arbitration
Act 1996 to encompass:
(a) whether there is a valid arbitration agreement;

(b) whether the tribunal is properly constituted; and
(c) what matters have been submitted to arbitration in accordance with
the arbitration agreement.
Qualitatively, there is a difference between, on the one hand, a dispute as

to the proper construction of an arbitration agreement and the related question
of whether a particular dispute falls within the scope of such agreement and, on
the other hand, a dispute as to whether a party is bound by an arbitration
agreement, to begin with. The second type of dispute is, as a rule, more fact-
intensive, whereas the first type may involve more questions of legal
interpretation. As a matter of judicial economy, it appears sensible to adopt the
practice of courts of appeal in according deference to determinations already
made on factual matters and to focus instead predominantly on whether the
law has correctly been applied.
Nevertheless, English courts consistently state that a jurisdictional challenge
issued pursuant to s. 67 entails a full re-hearing of the jurisdictional question. As
articulated in Electrosteel Castings Limited v. Scan-Trans Shipping & Chartering
SDN BHD [2002] EWHC 1993 (Comm) (para. 22), “[t]he question for the Court
is … not whether an arbitrator was entitled to reach the decision to which he
came, but whether he was correct to do so.” The Judge in Electrosteel went so
far as to suggest that the s 67 challenge was to a “provisional ruling only” by
the arbitral tribunal, thereby laying the groundwork to disregard the tribunal’s
BENEFITS OF A JUDICIAL RE-HEARING OF JURISDICTIONAL OBJECTIONS 155
findings altogether (s 30 of the Arbitration Act 1996 provides that a tribunal is

competent to rule on its own substantive jurisdiction, but that any such ruling
may be challenged). Whilst at least one High Court judge has subsequently
questioned that assertion (i.e. the jurisdictional decision by the tribunal “is a
final determination, unless appealed” (Aikens, J in Primetrade A.G. v Ythan Limited
[2005] EWHC 2399 (Comm), para. 54.)), it is nonetheless the consistent practice
of the English courts to re-examine for themselves the jurisdiction of the tribunal.
In that respect, there is to be no preconception that the arbitrators reached the
correct conclusion (Jiangsu Shagang Group Co Ltd v Loki Owning Company Ltd
[2018] EWHC 330 (Comm), para. 13). There is indeed widespread consensus
that no deference is to be given to the findings and reasoning of the tribunal.
According to Lord Justice Saville in Dallah Real Estate v The Ministry of Religious
Affairs [2010] UKSC 46 (para. 160):
… The starting point … must be an independent investigation by the court

of the question whether the person challenging the enforcement of the
award can prove that he was not a party to the arbitration agreement
under which the award was made. The findings of fact made by the
arbitrators and their view of the law can in no sense bind the court,
though of course the court may find it useful to see how the arbitrators
dealt with the question. Whether the arbitrators had jurisdiction is a
matter that in enforcement proceedings the court must consider for itself.
More forcefully, Bryan J has commented that “[u]ltimately jurisdiction either

is, or is not, conferred on the true construction of the arbitration agreement,
and that ought not to be fettered by how arguments were advanced below” or
by “the reasoning of the arbitrators”, whereby “experience shows that the
arguments on challenge can be, and are, often presented in fresh and different
ways” (GPF GP Sarl v. The Republic of Poland, [2018] EWHC 409 (Comm), para. 70).
In any event, “the tribunal’s reasons will almost invariably be before the court and
will carry as much persuasive weight as their cogency gives them” (Moore-Bick LJ
in Dallah Estate and Tourism Holding Company v. Court of The Ministry of Religious
Affairs, Government Appeal of Pakistan [2009] EWCA Civ 755, para. 21).
A re-hearing entails a de novo hearing of factual and expert evidence. This
is because “where … there are substantial issues of fact … the court, upon a
challenge under s 67, should not be placed in a worse position than the arbitrator
for the purpose of determining that challenge” (Azov Shipping Co. v Baltic
Shipping Co. [1999] 1 All ER 476, at p 4). Moreover, it is “in general up to the
parties … to determine the evidence on which they wish to rely;” such evidence
is not limited to the evidence before the arbitrators (Central Trading & Exports
Limited v. Fioralba Shipping Company [2014] 2 Lloyd’s Rep 449, at para. 30).
Repeatedly, courts have clarified that there is no prohibition under the civil
procedure rules or Arbitration Act 1996 on adducing new evidence. As a matter
of fairness, where evidence has been shut out before an arbitrator, “any prejudice
to the losing party is ameliorated by his opportunity to adduce that evidence

under section 67 in the course of challenging the arbitrator’s ruling” (Aoot
Kalmneft v. Glencore International AG, Andrew W A Berkeley [2002] 1 Lloyd’s
Rep 128, at para 91). However, whilst new evidence is admissible, only such
objections to jurisdiction may be raised as fall within the scope of the objections
originally raised before the arbitral tribunal (Primetrade, at paras 12–18 and 112).
One aspect receiving relatively little commentary is that English civil
procedure includes powerful tools not available in international arbitration:
interrogatories, standard document disclosure, the threat of sanctions for any
contempt of court, and also the publicity of the proceedings. Where the
jurisdictional challenge hinges on factual matters, the first three of these tools,
if used appropriately, can help achieve greater clarity on the underlying facts
and thus assist the court in ascertaining whether the challenged jurisdictional
decision was correct. However, the tools can also be employed for ulterior
purposes, for example, to attempt to muddy the waters and drive up costs, so
as to try to compel a settlement between the parties. Guerrilla tactics are not
unknown in this context.
A case in point is Filatona Trading v. Navigator Equities [2019] EWHC 173
(Comm). This was a joint venture dispute in relation to a textiles factory in central
Moscow, in respect of which a shareholder agreement had been entered into
by Filatona Trading and its ultimate beneficial owner, Oleg Deripaska, and by
Navigator Equities and its ostensible ultimate beneficial owner, Lolita Danilina.
Vladimir Chernukhin said that he was the true beneficial owner of Navigator
and a disclosed principal who had entered into contractual relations, including
an arbitration agreement, with Mr. Deripaska and Filatona, whereby Ms. Danilina
signed the shareholder agreement as his agent, as was known to all contractual
counterparties (Clifford Chance acted for Mr. Chernukhin). By the time arbitration
proceedings commenced, Mr. Chernukhin and Ms. Danilina had become
estranged; Mr. Chernukhin could not rely on Ms. Danilina to support his claim;
and Mr. Deripaska denied ever having had any business relationship with
Mr. Chernukhin. Neither party called Ms. Danilina as a witness in the jurisdictional
stage of the LCIA arbitration. But once Mr. Chernukhin had prevailed,
Mr. Deripaska entered into an Interest Purchase Option Agreement with
Ms. Danilina by which he acquired an option to purchase her alleged beneficial
interest in Navigator in the event that she secured “confirmation of title” to
that beneficial interest; Mr. Deripaska also provided funding for Ms. Danilina’s
claim. Thereupon, Ms. Danilina issued High Court proceedings and Mr. Deripaska
issued a claim under s 67 challenging the LCIA tribunal’s jurisdictional
determination. Mr. Chernukhin responded that the agreement between
Mr. Deripaska and Ms. Danilina was dishonest and corrupt and a perversion of
the course of justice. Nonetheless, the two claims proceeded, now with
Ms. Danilina’s evidence, extensive disclosure in relation to Mr. Chernukhin’s
corporate holdings and sources of wealth and ample press coverage. Although
Mr. Chernukhin and Navigator again prevailed, also on appeal, Mr. Chernukhin
BENEFITS OF A JUDICIAL RE-HEARING OF JURISDICTIONAL OBJECTIONS 157
ended up exposed to personal vulnerability due to the publicity relating to his

private financial matters.
Given that the High Court and Court of Appeal came to the same conclusion
on jurisdiction as had a very eminent London Court of International Arbitration
(LCIA) tribunal, one wonders whether over two years of litigation were worth
the trouble. With the benefit of hindsight, it is clear that issuing the s. 67
challenge was part of a strategy to delay the vindication of Mr. Chernukhin’s
rights (he subsequently prevailed on the merits of the arbitral dispute).
Further, Mr. Deripaska, in his own interest, succeeded in undermining two of
the key attractions of international arbitration, namely the confidentiality and
efficiency of proceedings. The endeavor was financially costly for both sides
(amongst other reasons because the High Court trial lasted six weeks, whereas
the jurisdictional hearing in the arbitration lasted 3.5 days). And had the
arbitral tribunal not already decided on the merits phase in the interim (no
stay of proceedings pending the outcome of the s 67 challenge was ordered),
there is a possibility that the court’s findings on the factual matrix could have
impacted the tribunal’s view of the merits—giving rise to a new question as to
the compatibility of the de novo hearing with the severability of the arbitration
agreement.
Notwithstanding Mr. Deripaska’s attempts to take every procedural
challenge available to him, in the circumstances, it nonetheless was right for
his s. 67 challenge to be conducted as a full re-hearing of the jurisdictional
question. The jurisdictional question centered on the existence or not of an oral
agreement between the two main protagonists and on discerning Ms Danilina’s
true role in the contractual construction. Although the Judge hearing the case
(Teare J) found that there were “real grounds to doubt the honesty of each of the
principle actors and of many of the other witnesses” and therefore reached his
decision on “matters that were common ground, such as contemporaneous
documents as there are, the probabilities and such other evidence as is reliable”
(para. 15), he needed to have heard the witnesses in question to come to that
conclusion and not be at a disadvantage to the tribunal as a fact finder. The
investigation of the structuring of Mr Chernukhin’s corporate holdings and of
his financial affairs, whilst highly unpleasant to him, were also necessary to
test his assertion of ownership over Navigator and his position as a true
contractual counterparty. The resulting confirmation of his entitlement to
prosecute his arbitration against Mr Deripaska was also a confirmation of the
legitimacy of the arbitral process, and therefore a pro-arbitration act.
In a number of other jurisdictions, greater deference is paid by national courts
to the findings made by and reasoning of arbitral tribunals in jurisdictional
matters (e.g., France and Switzerland and also to a certain extent in the U.S.).
Does the lighter touch mean that arbitral claimants are undeservedly surviving
jurisdictional challenges?
It is impossible to generalise in the abstract. However, it is notable that
some of the jurisdictions taking a lighter touch are civil law jurisdictions with
very different approaches to conducting civil court proceedings than in common

law England. Where instruments such as adversarial witness interrogation and
compelled document disclosure are unavailable, it may not be feasible to
properly replicate the jurisdictional phase of an arbitration before a civil court.
By default, the approach to hearing and considering challenges of jurisdictional
awards must differ.
But what about challenges to jurisdiction ratione materiae rather than
ratione persone? Where the question under review is whether a particular
dispute falls within the scope of an arbitration agreement, little if anything may
turn on evidence as to the underlying facts. That being the case, a de novo
hearing of the jurisdictional phase, open to further investigation of the factual
matrix, is disproportionate. In the circumstances, a better approach would be to
limit the role of the courts to sense-checking the arbitral tribunal’s jurisdictional
decision based on the arbitral record, in a manner analogous to a court of appeal.
Such limitation could be achieved by stipulating that the court’s leave is required
in order to re-open the factual record which was before the arbitral tribunal.
This would put the burden on the applicant to demonstrate any or all of: (i) the
existence of new evidence which was not before the tribunal; (ii) the inadequacy
of the fact finding procedure available in the arbitration; and/or (iii) the
prejudice which the applicant would suffer in the absence of a de novo hearing.
It remains to be seen how, if at all, the English Law Commission amends s. 67
in the coming months. Recent amendments to the Commercial Court Guide have
already sought to limit the scope of s. 67 challenges, for instance by authorising
courts to dismiss challenges on paper; requiring challengers to demonstrate
that there are “serious grounds” to contend that the matters relied upon go to
substantive jurisdiction rather than being caught, if at all, by the grounds for
challenge under sections 68 and 69 of the Arbitration Act 1996; and by extending
indemnity cost consequences to unsuccessful s. 67 challenges. At the very least,
these steps should deter spurious s. 67 challenges.
As things stand, in the English context, the current rigorous approach to
examining challenges to jurisdictional awards still comes with significant costs
for the parties involved. Where the resolution of the jurisdiction challenge
turns on factual questions, such rigour nonetheless is pro-arbitration, in the
sense of protecting innocent parties from being dragged into a forum to which
they have not agreed and thereby also protecting the legitimacy of the arbitral
process. That rigour is particularly important where a not insignificant percentage
of parties involved in London-seated arbitrations structure their business
relationships offshore with the help of trusts and similar mechanisms, the
proper investigation of which may require the litigation toolset of a common
law court. The promise of enhanced protection for non-parties from wrong
jurisdictional outcomes is a factor very much in favour of choosing England as
an arbitral seat.
Chapter 26
HOW ARE ARBITRATION PRIVACY AND
CONFIDENTIALITY PROVISIONS
“PRO-ARBITRATION”?
Claire Hellweg*
I. INTRODUCTION
As Professor George Bermann writes about in “What Does It Mean to be

“Pro-Arbitration?”, the term “pro-arbitration” can have many meanings that can
be used to analyze various arbitration policies. In that article, Professor Bermann
states that determining whether a policy is pro-arbitration is important because
in order to function at all the international arbitration field needs such policies
to be approved by courts, legislatures, and users.
One type of policy to be analyzed in this context is confidentiality and
privacy provisions in the international arbitration field, as “[c]onfidentiality
and privacy are hallmark features in the arbitration procedure” [Roy Shapira,
Mandatory Arbitration and the Market for Reputation]. As this essay illustrates,
one common idea is that privacy and confidentiality provisions are pro-
arbitration because these allow parties to avoid negative publicity from disputes.
Thus, parties are more likely to favor arbitration because they can enjoy more
privacy, and this may increase the use of arbitration in general. However, whether
a policy increases the use of international arbitration is not the only consideration
for determining whether the policy is pro-arbitration. As per Professor Bermann,
another consideration is whether the policy promotes accuracy in the
administration of justice. I will address this point below.
II. BACKGROUND
Some, though not all, institutional rules (rules often supported by institutional
oversight and support) reference confidentiality and/or privacy explicitly
[James Hargrove, Misplaced Confidence? An Analysis of Privacy and Confidentiality
in Contemporary International Arbitration]. For example, the London Court of
International Arbitration Rules state in Article 30.1 that:
The parties undertake as a general principle to keep confidential all

awards in the arbitration, together with all materials in the arbitration
created for the purpose of the arbitration and all other documents
* Claire Hellweg is a 2022 Columbia Law School Graduate.

159
produced by another party in the proceedings not otherwise in the

public domain, save and to the extent that disclosure may be required
of a party by legal duty, to protect or pursue a legal right, or to enforce
or challenge an award in legal proceedings before a state court or other
legal authority. The parties shall seek the same undertaking of
confidentiality from all those that it involves in the arbitration, including
but not limited to any authorised representative, witness of fact, expert
or service provider.
James Hargrove helpfully summarizes general views on privacy and

confidentiality in the international arbitration field in their article, Misplaced
Confidence? An Analysis of Privacy and Confidentiality in Contemporary
International Arbitration, as restated below. In general, “the privacy of oral
hearings is accepted and protected in most jurisdictions and under most
institutional rules.” However, different jurisdictions have developed different
approaches on absolute confidentiality without the parties’ having a private
agreement on confidentiality. England, Singapore, and France are more pro-
confidentiality whereas Australia, the United States, and Sweden are less pro-
confidentiality. It is also worth noting that, as James Hargrove states, “separate
rules and considerations apply to investor-state arbitrations, where materials
and awards are regularly made public.” Parties of course can, and often do,
enter into private agreements regarding privacy and confidentiality.
III. ADMINISTRATION OF JUSTICE
As noted above per Professor Bermann, one question to ask when

evaluating whether a policy is pro-arbitration is “to what extent does it promote
accuracy in the administration of justice?”
One consideration when determining if a policy meets this criteria is
evaluating when courts take independent action regarding privacy and
confidentiality provisions. Privacy and confidentiality provisions in international
arbitration may impede justice in certain circumstances, but courts can address
this problem and take action to create more just outcomes. For example, “some
courts have found confidentiality provisions unconscionable” [Amy J. Schmitz,
Untangling the Privacy Paradox in Arbitration]. Plaskett v. Bechtel Int’l, Inc. is
illustrative, as referenced in furtherance here. In Plaskett v. Bechtel Int’l, Inc.,
the parties incorporated the American Arbitration Association rules into their
private agreement, which meant that the names of the parties would not be
publicly available unless “a party expressly [permitted] its name to be made
public in the award.” The court found that although this rule is facially neutral,
this restriction disproportionately favored one party so it found substantive
unconscionability. Specifically, “the ability of a party to unilaterally prevent the
inclusion of its name in the award favors the repeat participant and makes it
difficult for a potential plaintiff to build a case of intentional misconduct or to
HOW ARE ARBITRATION PRIVACY PROVISIONS “PRO-ARBITRATION”? 161
establish a pattern or practice of discrimination by a particular company.” The

court therefore found that the American Arbitration Association rules providing
for confidentiality were unconscionable and declined to uphold them. Thus,
due to this power by the courts to invalidate privacy and confidentiality provisions
that are unfair to one of the parties, privacy and confidentiality provisions have
a higher chance of promoting accuracy in the administration of justice.
Courts may also decline to enforce confidentiality or privacy provisions “to
protect public access where the public’s interest in a dispute overrides the
disputants’ freedom to contract for confidentiality” [Amy J. Schmitz, Untangling
the Privacy Paradox in Arbitration]. In re Storag Etzel GmbH, Storag Etzel GmbH
is illustrative here: Storag Etzel GmbH filed a proceeding pursuant to 28 U.S.C.
§ 1782 to obtain discovery from Baker Hughes. Two arbitrations were conducted
in Germany by the parties regarding a dispute, which were governed by the
German Arbitration Institute rules. In its application to obtain discovery from
Baker Hughes, Storag sought to maintain confidentiality over information that
would be contained in the application and associated documents. Thus, Storag
wanted to file its documents under seal to maintain confidentiality protected
by Article 44.1 of the German Arbitration Institute Rules.
The Delaware District Court applied three bodies of law to determine this
issue of confidentiality and whether Storag could do this. Firstly, it mentions
that there are principles governing the issuance of protective orders in federal
litigation pursuant to Rule 26(c) of the Federal Rules of Civil Procedure.
Specifically, “[p]rotective orders entered pursuant to Rule 26(c) are most soundly
justified when the documents at issue contain trade secrets or other confidential
business information” but even these do not have automatic immunity against
disclosure. The court then mentions that “federal courts recognize a common
law right of access to judicial records” and that there is a presumption in favor
of access to such records which include judicial records and documents.
Thirdly, the court notes that the public and press have a First Amendment right
of access to civil trials and that any restriction on this right is evaluated under
strict scrutiny.
Under these principles, the court found that information concerning the
arbitration other than the first arbitration award itself should not be sealed.
The court stated that “both parties in their filed submissions have expansively
redacted information concerning the very existence of the arbitration,
information identifying the parties to the arbitration, information concerning
the German DIS Tribunal’s procedural orders, and information identifying the
nature of the parties’ claims in arbitration.” The court then held that “[t]he sealing
of this information cannot be justified under the common law principles
articulated . . . nor under the First Amendment right of access to judicial records.”
Thus, this case shows that courts can invalidate privacy or confidentiality
provisions when it is in the public interest to do so. This helps ensure that
privacy and confidentiality provisions better ensure access to administration
of justice by allowing the public to be informed about important arbitration

matters.
Another matter of justice is whether practitioners and scholars can use
private information to learn and advance the international arbitration field.
Amy J. Schmitz’s article, Untangling the Privacy Paradox in Arbitration, is helpful
and referenced further here. Privacy and confidentiality provisions might
often prevent this or make this more difficult. However, “[r]egardless of any
confidentiality precautions parties may take, information regarding the
proceedings may nonetheless become public.” For example, one surveyor
“reported that attorneys and other players in arbitration were willing to talk
about their experiences, and that information about arbitrations ‘often leaks
out’ through securities disclosures, press coverage, and arbitration or court
papers.” Additionally, third parties are often not bound to confidentiality or
privacy agreements so they may also be a source of information for scholars and
practitioners. “Arbitrators rarely require that all attendees sign confidentiality
agreements, and institutional arbitral rules usually do not require such
agreements.” This might also include witnesses in addition to third party
attendees.
Therefore, this is a way to ensure international arbitration practitioners
and scholars have the opportunity to learn more about arbitrations despite
their confidentiality and privacy provisions, which is a way to ensure more
access to administration of justice. This is because if scholars and practitioners
have access to otherwise private information, they can learn from such
information and work to advance the international arbitration field.
IV. CONCLUSION
Although there may be concerns that privacy and confidentiality provisions

in international arbitration are not “pro-arbitration,” in that they might impede
access to administration of justice, there are different measures available to
ensure that such provisions do indeed promote the administration of justice.
This is an important topic because it often relates to other policy considerations
like the general desire for publicly accessible information. As Professor George
Bermann states, “[a] moment’s reflection tells us that a policy or practice that
appears to be pro-arbitration in one respect may not only have arbitration-
unfriendly consequences in other arbitration-related respects, but also in
respect of considerations having nothing to do with arbitration.” Thus, it is
important to keep these issues in mind when examining whether policies like
privacy and confidentiality provisions are pro-arbitration.
Chapter 27
LEGITIMACY AS A MEASURE OF ARBITRATION-
FRIENDLINESS
Clemens Treichl*
I. AN APPEAL TO THINK TWICE
“Those who practice in the field, especially at the international level,

are not only heavily engaged in international arbitration, but they also
are heavily engaged by it.”
George A. Bermann, 34 (2018)

ARB. INT‘L. 341, 341
A number of events have shaken the practice of international arbitration

since Professor George A. Bermann shared the above observation in his 2018
paper on what it means to be “pro-arbitration.” His description, however, appears
no less fitting today. Years into a pandemic which has profoundly impacted the
arbitration enterprise and shifted most of it to the virtual space, the commitment
of arbitration practitioners to the health and well-being of their field remains
unfettered. More recently, devastating military conflict in Europe has been a
reminder of how important it is to foster peaceful and rules-based means of
dispute settlement on the international plane.
That a highly active arbitration community exists, and that this community
is particularly concerned with the arbitration-friendliness of policies and the
decisions which they entail, is in part the merit of figures like Professor Bermann
himself. His thinking has motivated—and continues to motivate—a significant
number of students and young practitioners across the world to partake in the
arbitration debate and enrich it with their views. With an exceptional awareness
of how essential issues are approached in different jurisdictions, which every
so often reach diametrically opposed results, Professor Bermann has inspired
a diverse and global audience to seek to better understand the many complexities
involved in transnational arbitration and litigation proceedings and ultimately
to relish navigating them.
The perception of many practitioners that arbitration is worthy of protection
and propagation perhaps also stems from a natural excitement for a process
which is always rooted in an act of consensus. This is even more so where the
* Clemens Treichl is an Associate at Freshfields Bruckhaus Deringer. Contact at:
clemens.treichl@freshfields.com. Any views and opinions expressed in this essay reflect only
those of the author, and any errors are the author’s own.
163
voluntary submission of parties to a dispute resolution process can resolve

difficulties that parties may face in international contexts due to widely
uncoordinated and sometimes incompatible domestic litigation systems. Every
arbitration is an expression of party autonomy and, in these contexts in particular,
reflects a commitment to the rule of law and the efficient dispensation of justice.
The measure of arbitration-friendliness, however, cannot solely be the extent
to which a given policy or practice promotes private autonomy in designing a
dispute resolution process. Indeed, there are conceivably many situations in
which the exercise of private autonomy can be seen as detrimental to the
objectives and values that define arbitration. Ultimately, prohibitions on the
exercise of private autonomy in certain circumstances do not necessarily have
to be “anti-arbitration.”
In his article, Professor Bermann cautions arbitration practitioners against
pursuing a “narrowly pro-arbitration agenda.” He proposes an analytical
framework for “expanding our notion of what is and what is not pro-arbitration”
and points the international arbitration community to the “multiplicity of metrics”
that are at play in making such determinations. He notes, above all, that values
extrinsic to arbitration itself are all too often left out of the equation, even
though the legitimacy that these values afford the arbitral process may ultimately
work as one of the most powerful factors in promoting it.
The following sections will briefly touch on the starting point for arbitration-
friendliness in today’s international framework and reiterate, in keeping with
Professor Bermann’s conclusions, why it would be short-sighted to look to no
more than formal categories of arbitration-friendliness.
II. ARBITRATION-FRIENDLINESS AS A (QUASI) GLOBAL POLICY
Before exploring what the categories are that distinguish “pro-arbitration”

policies from those that are “anti-arbitration,” it is worth contemplating whether
a general “pro-arbitration” policy exists and what some of the possible sources
for arbitration-friendliness are.
One instrument has contributed more than anything to an increasingly
arbitration-friendly environment globally and has appropriately been described
as the foundational instrument for today’s arbitration practice at large: the
New York Convention. With almost universal membership, and alongside a
widely adopted UNCITRAL model arbitration law, the New York Convention
has worked as the strongest accelerator in the breakthrough of arbitration as
the preferred means to settle cross-border disputes.
While the New York Convention does not provide a framework for the
conduct of an arbitration, it ensures the mobility of awards across borders by
compelling contracting states to recognise and enforce foreign arbitral awards
unless there is a permissible ground under the Convention to refuse to do so.
On this basis, it embodies an exceedingly “pro-arbitration” stance that has given
LEGITIMACY AS A MEASURE OF ARBITRATION-FRIENDLINESS 165
rise to what can arguably be described as an international policy in favour of

arbitration.
Throughout the centuries, arbitration-friendly approaches were not always
a given. While arbitration was common in both Greek and Roman Antiquity in
various contexts, there were also times in which the arbitral process was frowned
upon, such as in a number of jurisdictions in the modern era. Napoleonic
legislation in France at the beginning of the 19th century, for example, displayed
an extreme hostility to arbitration agreements, whereas US courts remained
largely hostile up until the adoption of the Federal Arbitration Act in 1925.
Needless to say, arbitration remains subject to a variety of pressures today.
These do not only pertain to the realm of investment arbitration, where a
veritable “backlash” has been observed in recent years, but also relate to the
commercial arbitration field. At the heart of much of the criticism is a debate
around legitimacy, which—as Professor Bermann notes—is perhaps the most
meaningful benchmark to determine whether a policy or practice is in fact
arbitration-friendly or not. Where legitimacy is enhanced or at least not
discredited, it may be irrelevant that the measure in question is “more costly,
curtails party autonomy, invites judicial intervention, removes a category of
claims from the universe of arbitrable disputes, or sacrifices in some other way
what we traditionally associate with arbitration friendliness.”
III. TRADITIONAL CATEGORIES OF ARBITRATION-FRIENDLINESS
We traditionally associate with arbitration-friendliness situations where

the law (i) honours parties’ agreements to arbitrate; and (ii) once an arbitration
has been validly launched, facilitates an efficient procedure as well as the effective
implementation of any resulting decision. The first issue goes to arbitrability
in the narrower sense of the term: provided that parties have referred a given
dispute to arbitration, will the courts be bound to allow it?
The concept of arbitrability is considered by some as obsolete, given that
most commercial disputes are arbitrable under the laws of most countries. The
proponents of this view instead propose the exploration of universal arbitrability.
This view overlooks, however, that today’s lack of objections against the
enforcement of arbitration agreements and awards on grounds of inarbitrability
is also a corollary of practitioners being highly attuned to more or less established
limits that do in fact exist. Most jurisdictions—if not all—exclude certain
categories of disputes from the arbitral process. Courts and lawmakers have
drawn the line in many different ways. One of the more frequently employed
examples is that of consumer disputes, which may be arbitrable in many US
jurisdictions but are generally not amenable to arbitration in any jurisdiction
within the EU.
At a first glance, it would appear that the less courts exclude certain types
of disputes from arbitration the more arbitration-friendly they are. It would,
however, be short-sighted to generally consider jurisdictions with fewer limits
to arbitrability as more arbitration-friendly than those with greater limits in

place, with the ideal state consisting in universal arbitrability. As Professor
Bermann demonstrates, the extension of arbitrability can lead to demands for
increased transparency and greater scrutiny of awards by the courts. Arbitrability
therefore cannot serve as a suitable yardstick of arbitration-friendliness
without a closer look at extrinsic factors.
The second issue, i.e. whether a given policy or practice facilitates an efficient
procedure and the effective implementation of a resulting decision, is often a
question of perspective. As comparative analyses reveal, the perception of
arbitration and its objectives depends heavily on cultural differences (even if
not always immediately obvious in everyday practice) as well as the practice
embedded in different legal systems and traditions. For example, where one
tradition provides for adversity, another might require collaboration. And what
may constitute basic requirements of fairness in one system could be regarded
as due process paranoia and inefficiency in another.
Indeed, any attempts to gauge degrees of arbitration-friendliness presuppose
a definition of what makes an arbitration in the first place. Even if basic differences
in definition may be less pressing within a highly professionalised environment
dominated by subject matter specialists, the approaches taken globally may be
less uniform than they seem.
IV. OUTLOOK
As ever with assessments that involve trade-offs among different

considerations, identifying what it means to be “pro-arbitration” is a multi-
faceted affair. One can hope that the ever-increasing force devoted to and engaged
by the arbitration enterprise will hear Professor Bermann’s appeal, lest we lose
sight of the broader context in which the arbitral framework operates and the
objectives it is meant to serve.
Chapter 28
ARE DC COURTS PRO‐ARBITRATION?
Craig D. Gaver*
The U.S. District Court for the District of Columbia and its supervisory court,
the U.S. Court of Appeals for the District of Columbia Circuit, are arguably the
most important courts in the world of international arbitration. Two recent
developments have made this so.
First, in 2017 the Second Circuit Court of Appeals determined that a petition
to recognize an ICSID award had to be filed in the DC District Court, not the
Southern District of New York (or anywhere else). That judgment, Mobil Cerro
Negro, Ltd. v. Bolivarian Republic of Venezuela, 863 F.3d 96 (2d. Cir. 2017),
performed a sophisticated analysis of the interaction between 22 U.S.C. § 1650a
(the statute implementing obligations under the ICSID Convention into domestic
law) and the Foreign Sovereign Immunities Act. The outcome sent a clear message
to successful claimants: if you want to enforce an ICSID award in the United
States, you have to start in the nation’s capital. New York remains America’s
financial center and, for that reason, will always play an important role in the
enforcement of arbitral awards. But in this instance—contrary to its usual
habit—New York ceded its prominence to DC.
Second, the Achmea decision and related developments signaled the
European Union’s intention to banish from the bloc arbitration arising from
intra-EU BITs. The Court of Justice subsequently extended the same line of
reasoning to arbitration arising under the Energy Charter Treaty, which features
non-EU Members as State parties, and to Member States’ ad hoc arbitration
agreements that substantially replicate the content of now-verboten intra-EU
BITs. Although Achmea claimed to distinguish purely private commercial
arbitration, some commentators have even envisioned a similar push into that
field as well. Whether it will slide farther down the slippery slope is yet
unclear. Consequently, the United States remains the favored offshore
destination for enforcing these awards, which means Washington, DC.
In his influential article, “What Does it Mean to Be ‘Pro-Arbitration’?”,
Professor Bermann thoroughly interrogated the eponymous question. He
correctly noted that the institution’s efficacy “depends importantly on the
attitudes of other actors, most notably courts and legislatures.” But he cautioned
readers to put investor-State dispute settlement aside in his inquiry. I cannot
do so here. Investment awards often (though not always) entail larger sums
* Craig D. Gaver is an Associate at Allen & Overy LLP, Washington DC and LL.M. from
Columbia Law School 2020. The views expressed herein belong only to the author and should
not be attributed to Allen & Overy or its clients.
167
and implicate issues of State sovereignty, and thus invite more careful reasoning
and public scrutiny. Despite the possibility of different venues, investment
arbitrations, like commercial arbitrations, are creatures of consent. For instance,
the U.S. Supreme Court treated investment and commercial arbitrations as
functionally similar for the purposes of 28 U.S.C. § 1782’s discovery provisions in
a recent decision, ZF Automotive US, Inc. v. Luxshare, Ltd., 142 S. Ct. 2078 (2022).1
If DC courts are indeed the most important in the world of arbitration, it
behooves the community to examine their record closely. Such a comprehensive
review, which would encompass other topics such as enforcing agreements to
arbitrate, ancillary actions in support of arbitrations, and all other issues
concerning recognition, enforcement, and execution of awards, deserves more
pages than this current treatment can give. However, using the DC courts’
response to the EU’s gradual turn against international arbitration is sufficient
to illustrate DC courts’ pro-arbitration posture.
* * *
The Micula saga is well known. After the brothers acquired their award in
December 2013, they set off a firestorm of litigation around the globe in the
national courts of Romania, France, the UK, the U.S., and elsewhere. They also
saw off an ICSID annulment challenge. In March 2015, following partial payment
of the award by Romania, the European Commission ruled that the payment
constituted illegal state aid. In June 2019, a five-judge bench of the General
Court annulled the Commission’s 2015 decision on the basis that EU state aid
law was inapplicable and that the Commission had exercised its powers
retroactively since Romania’s acts occurred prior to its accession to the EU.
(The General Court’s ruling was itself overturned and remanded by the Court
of Justice in January 2022, adding another chapter to the tale that is beginning
to rival Jarndyce v. Jarndyce in length.)
Most of these developments occurred as the DC District Court prepared to
issue a decision on the petition to enforce the award. The court’s decision in
September 2019, Micula v. Government of Romania, 404 F.Supp.3d 265 (D.D.C.
2019), was significant. The Commission appeared as amicus curiae, so the
court was able to respond to their arguments directly. The Commission asserted
that the ruling in Achmea “applie[d] foursquare” and, therefore, no valid
agreement to arbitrate had been formed by the Sweden-Romania BIT. Yet the
court distinguished Micula from Achmea by reasoning that the latter was
meant to protect “the autonomy of EU law.” It based that determination on
three grounds. First, a concern for the autonomy of EU law did not exist in Micula,
particularly since all material events in the case occurred prior to Romania’s
accession to the EU. Second, the underlying tribunal did not rule upon “a
question of EU law in a way that implicate[d] the core rationale of Achmea.”
While EU law applied as part of the “factual matrix” of the case, neither the
1 Allen & Overy appeared as counsel of record for the Respondent.

ARE DC COURTS PRO-ARBITRATION? 169
tribunal (and consequently the court) had to decide whether compensation

arising out of the award constituted illegal state aid under EU law as a question
necessary for the disposition of the dispute. Third, notwithstanding the EC’s
amicus submissions, the DC court recognized that the General Court had
annulled the Commission’s 2015 decision on state aid on similar temporal
grounds that the court had already addressed. The DC Circuit affirmed the
decision on appeal in a tightly focused, unpublished opinion, Micula v. Government
of Romania, 805 Fed.Appx. 1 (D.C. Cir. 2020). That the appellate court did not
find it necessary to grapple with the EU law arguments in any great detail
(whether presented by the Commission or by Romania) speaks to their lack of
importance in the DC enforcement action.
* * *
In September 2021, the Court of Justice of the European Union (CJEU) in
Moldova v. Komstroy, Case C-741/19, stated that the Energy Charter Treaty’s
(ECT) investor-State dispute settlement mechanism in Article 26 was not
compatible with EU law. The court also determined that the acquisition of a
claim arising from an electricity supply contract does not constitute an
“investment” under the ECT. The reference arose out of an arbitration seated
in Paris, whose 2013 award had been set aside and then reinstated by French
courts at the request of Moldova.
By the time the CJEU rendered its decision, Komstroy (the original claimant’s
successor-in-interest, who in time would be replaced by SPC Stileks) had already
succeeded in confirming the award in the DC District Court. The DC Circuit
affirmed that ruling, but vacated and remanded on the limited ground of
converting the judgment from the Moldovan lei to U.S. dollars. The CJEU’s
decision landed when the DC District Court was considering the case on remand.
There, Moldova sought a second stay pending the outcome of the renewed
proceedings in France (following the CJEU decision). In denying Moldova’s
request for a second stay, the District Court observed that “[t]he parties are
now poised to argue the impact of the CJEU decision before the Paris Court of
Appeal … [which] will be subject to another round of appeal to the Court of
Cassation … [which] could easily stretch into the spring of 2024 or beyond.”
2021 WL 5318029, at *4. The District Court also cast doubt on Moldova’s
contention that the Paris court would “automatically” convert the CJEU decision
into a judgment vacating the award.
The District Court never addressed the CJEU or ECT head-on, but observed
that “it is not obvious that the CJEU interpretation of the ECT would apply to
the ECT’s non-EU member signatories—like Moldova and Ukraine. While the
CJEU decision is binding on French courts as to matters of EU law, it is for Paris
Court of Appeal to apply the law to the specific facts of this case.” The District
Court’s opinion could be characterized in several ways—as one concerned
with the efficient administration of justice, or a straightforward application of
the New York Convention, for example—but this aside suggests that the DC
District Court thought little of the CJEU’s reasoning and that it would have reached
a similar outcome even if the CJEU’s Komstroy opinion came earlier in time.
* * *
It is unclear whether Achmea-based arguments will fare better in future
cases. As a wave of intra-EU BIT cases began to crest and break throughout the
latter half of the 2010s, successful claimants sought enforcement of awards in the
DC District Court.2 Many of those cases have been stayed pending the outcome
of ICSID annulment proceedings. In most cases, the Commission has sought to
intervene as amicus in order to submit Achmea or Komstroy-based arguments.
As of the date of drafting, none of the several cases has produced a reasoned
opinion. They will present different factual and legal postures for the District
Court to resolve than Micula and Komstroy/SPC Stileks, yet there is reason to
believe that the District Court will continue to dismiss EU-based objections in
favor of the United States’ legal obligations to enforce awards under the ICSID
Convention and New York Convention. Such an outcome would exemplify what it
means to be “pro-arbitration.” There are many problems with the EU’s approach.
Some are rooted in errors in the application of public international law or a
conflict of laws analysis. Another characterization may be seen as an
aggrandizement of the collective (or the Commission in particular) at the expense
of the individual Member States. But the most egregious error is that the EU
attacks the foundation of international arbitration: consent. A legal person—
whether natural, corporate, or juridical—should have the capacity to consent
to be bound to an agreement to arbitrate. Anything that impinges upon this
right—even when justified by other policy concerns—cannot be said to be
“pro-arbitration.”
Professor Bermann knows this well. His early scholarship in European law
as well as his decades of unrivaled thought leadership in the realm of international
arbitration make him uniquely qualified to opine on these issues. Judges—
even Supreme Court Justices in the aforementioned ZF Automotive case and
others—have benefited from his amicus submissions, expert opinions, and
other scholarship. His Restatement of the Law, The U.S. Law of International
Commercial and Investor-State Arbitration, will be one of the first stops for the
DC federal court judges grappling with these vexing issues. Generations of his
students populate law firms, government offices, and academic positions around
the globe and continue to project his influence.
The DC courts are pro-arbitration. If they continue to reject the EU’s
attacks on international arbitration (as they should), they will vindicate
Professor Bermann’s legacy. If they fail to do so, it will justify why his acolytes
must remain constantly vigilant to ensure that the field to which Professor
Bermann has devoted his career remains effective and respected by U.S.
courts.
2 Allen & Overy has represented several claimants in this collection of proceedings.
Chapter 29
A PRO-ARBITRATION APPROACH: REFLECTIONS
FROM THE ARBITRATOR’S PERSPECTIVE
Cristián Conejero Roos*
I. INTRODUCTION
I met Professor Bermann back in the Spring semester of 2003. I was a LLM
student at Columbia Law School and took his course on Transnational Litigation
and Arbitration. He is a unique professor: with an extraordinary and gifted mind,
committed to his students and exuding passion and knowledge about the
topics he taught. My time at Columbia and specifically my exposure to his
course were game changers for my professional career. I was lucky enough to
later become Counsel at the ICC International Court of Arbitration in Paris
overseeing cases in Latin America, Spain and Portugal and a partner at
Cuatrecasas co-leading its international arbitration group and devoting my
entire time to the practice of international arbitration, both as counsel and
arbitrator. After I left Columbia Law School, I met again Professor Bermann
several times. Most notably in 2017 when I had the privilege to sit as an
arbitrator in a tribunal chaired by him. It was a wonderful experience which
lasted a couple of years and gave me the special privilege of now being able to
address Prof. Bermann simply as George, in a true sign of friendship and
affection.
II. ON GEORGE’S PRO-ARBITRATION ARTICLE
In his article, George carefully demonstrated how difficult it can be to espouse

the view that a policy is “pro-arbitration”. Arbitration is a system composed of
internal values that sometimes contradict each other. In some instances, a
policy might encourage certain values of the arbitral process at the expense of
others that may be equally or even more important. George identifies different
policies that could be labeled as arbitration friendly. It is not very difficult to
imagine how they could sometimes collide between them.
Further, as George rightly notes, the question of whether a policy ultimately
serves the purpose of promoting arbitration as a dispute adjudication system
must also consider its effects on structures of values that live outside of
arbitration. In his article, he recognizes that a policy that upholds certain
arbitral values could also conflict with values that surpass arbitration and are
part of a broader legal and social order. The underlying question of how and to
* Cristián Conejero Roos is a Partner at Cuatrecasas and a Columbia Law School LL.M. ’03.
171
what extent arbitration needs to be reshaped to incorporate those external

values is also subject of controversy.
Two illustrative examples of these competing forces, both internally within
arbitration’ policies and externally with broader values, are the use of virtual
hearings and the influence of transparency in international arbitration. Both
affect the function and conduct of an arbitrator, which is a role that I perform
regularly. My views below are the result of my experience in that role.
III. TWO DILEMMAS FROM THE ARBITRATOR’S PERSPECTIVE
A. Virtual Hearings
There is a natural tension between ensuring an efficient, speedy procedure

while keeping due process concerns at bay. From the arbitrator’s perspective,
granting the parties too ample opportunities to present their case might delay
justice to the point of making it futile. As the legal maxim goes “justice delayed
is justice denied”. Yet, prioritizing a quick procedure without due regard to the
legitimate concerns of the parties to have their proper day in court could
compromise the value of due process and raise concerns as to the enforceability
of the arbitral. In cases such as this, there appears to be no predefined hierarchy
of values to clearly solve this conundrum.
Virtual hearings reflect this conflict. The global pandemic triggered by
Covid-19 effectively shut down the world and disrupted two elements that
were inherent to hearings in international arbitration: travel and meeting of
people. With governments struggling to put travel and quarantine restrictions
in place as quickly as possible, arbitral procedures were cut short literally from
one day to the other. While this was happening, I was stationed in Buenos Aires
preparing for hearings in an ICC arbitration. At some point, I learned that the
borders were closing, and foreigners were given notice that they had 48 hours
to evacuate the country. We had to leave the city on the eve of the hearing,
which naturally ended up being postponed for several months and later held
virtually. The speed and the degree of the pandemic took everyone by surprise.
And, like the rest of the world, arbitration was forced to go virtual.
Given the radical change of context, the arbitral community was immediately
forced to determine whether virtual hearings were a “pro-arbitration”
development or not. When the question was first introduced at the beginning
of the pandemic the answer was far from clear because virtual hearings faced
a big contention that they were at odds with the basic values of parties’ consent.
Indeed, the first drawback that virtual hearings faced during the pandemic was
the lack of an express agreement of the parties to have virtual hearings.
Arbitration agreements, institutional rules and procedural orders were almost
invariably silent on the availability of virtual hearings. The arbitration community
understood though that consent, while being a core value of arbitration, should
conform to the new needs to conduct an arbitration under these circumstances.
A PRO-ARBITRATION APPROACH 173
Quickly, many arbitral institutions moved to enact and promote guidelines and
protocols for virtual hearings [see, ICC Checklist for a Protocol on Virtual Hearings
and Suggested Clauses for Cyber-Protocols and Procedural Orders Dealing with
the Organization of Virtual Hearings, which were preceded by the ICC Guidance
Note on Possible Measures aimed at mitigating the effects of Covid-19 Pandemic,
dated 9 April 2020]. In practice, many hearings started shifting to virtual mode
as there were no other choices.
Even now that the restrictions from the pandemic have been lifted, virtual
hearings continue to enjoy enormous success. Clearly, they provide a speed
and cost-effective solution. Organizing and carrying out weeklong hearings for
arbitrators, counsel, parties, witnesses, experts, and every other administrative
entity involved is expensive and time-consuming.
As a result, almost no one debates the appropriateness of virtual hearings
to hold case management conferences, mid-stream conferences or even hearings
dedicated exclusively to legal or closing arguments. All these hearings are
generally limited in time (one day at most), and do not require massive exhibition
of documents or examination of experts or witness. But evidentiary hearings
on the merits are a different story and concerns remain as to whether virtual
hearings can properly respect due process in this context. I can think of at least
two tensions where due process and procedural fairness may be exposed if no
appropriate measures are taken.
First, virtual hearings may create potential imbalances between parties.
Virtual hearings can create an uneven level playing field if the arbitral tribunal
is not fully aware of the conditions in which each party is able to join hearings
of this nature. In complex arbitrations where several witnesses and experts are
to be examined, reliable access to technology is critical. Parties should have
equivalent set of resources to have access to similar conditions of connectivity,
number of screens, and other logistical needs which are required to participate.
Failing to secure an excellent, speedy, and steady connection for all those
involved in the hearing may create unwelcomed differences. Also, conduct of
the hearing can be impaired by differing time zones between arbitrators, counsel,
and witnesses. If the time differences are significant, witnesses (and opposing
counsel) could suffer the burden of giving (and taking) testimony at rather
unorthodox times. Arbitrators should be aware of these special situations
beforehand to adjust the conduct of the hearing accordingly such as holding daily
hearings of shorter extension, and more than one hearing to allow for times in
between to organize the remainder of the hearing. If not, procedural fairness
may be at stake and in most modern legal systems this is a ground to attack the
validity and enforceability of arbitral awards.
Second, virtual hearings may pose serious evidentiary issues. Hearings
provide the tribunal and counsel the unique opportunity to examine witnesses
and experts in person. Virtual hearings imply the lack of such in-person
examination, which constitutes an important element of the tribunal’s ability
to assess evidence. Body language, facial expressions and tonal changes may
be lost or diminished in virtual hearings. And there are also other challenges
that come with virtual hearings. Sequestration of witnesses can be impossible
with all the different incumbents in different jurisdictions. Witness coaching
also becomes a threat, as it is harder to determine if someone is coaching the
witness from near the room or by other remote means. The use of exhibits may
translate into a difficult and lengthy exercise if extensive documentation must
be shown to the witnesses. Cross-examination of witness can prove particularly
difficult for counsel who requires to coordinate use of exhibits, follow live
record of the transcript, be attentive to the reception from the arbitral tribunal
and to the reactions from the witness or expert on stand (each captured by a
different camera) [Nika Madyoon, Virtual Hearings in International Arbitration:
Challenges, Solutions, and Threats of Enforcement, in Stavros Brekoulakis (ed.)
Arbitration: The International Journal of International Arbitration, Mediation,
and Dispute Management, Kluwer Law International, 2021, Volume 87, Issue 4,
pp. 597–611]. From the arbitrators’ perspectives, all these may become relevant
issues in the organization of the hearings that cannot be left unattended.
In short, borrowing George’s words, arbitrators should search for the most
adequate trade-offs between the intrinsic values at play in arbitration. Now that
travel and gathering restrictions have been significantly reduced or eliminated
in most places, one should rethink the use of virtual hearings as a one size fits
all solution. Hearings by remote means are the most effective tool for meetings
others than hearings on the merits. However, one may still consider examination
in person of key witness and experts as offering inherent advantages to maximize
the role of the tribunal in assessing the evidence and ensuring the same level
playing field. This might also be viewed as a sensible compromise between the
competing forces of fairness and expediency.
The question remains, however, if there are external values that militate in
favor of virtual hearings. If we look outside of the confines of arbitration and
the specific context of the Covid-19 pandemic, virtual hearings may also advance
more general societal values such as the fight against climate change. Virtual
hearings, due to their comparatively lower carbon footprint than in-person
hearings, may appear as embracing a policy in tune with climate considerations,
as recently occurred with the policy in favor of paperless submissions in lieu of
printed bundles [Campaign for Greener Arbitrations, available at
https://www.greenerarbitrations.com/events/going-paperless-in-arbitration-
why-and-how].
Climate change considerations were not a deciding factor that led to the
mass implementation of remote hearings during the pandemic. Yet, climate
change is without a doubt one of the most important policy challenges of this
generation. Significant efforts are being made at the domestic and international
level to address climate change and articulate an effective response. The
arbitration community has promoted arbitration and ADR as a mean to
effectively resolve climate change related disputes [“Resolving Climate Change
Related Disputes through Arbitration and ADR” by the ICC Commission on
Arbitration and ADR at the International Chamber of Commerce]. But the

legitimacy of arbitration, as a dispute adjudication system, to solve climate
changes disputes may depend on its further commitment to address climate
impact as a whole. As a result, the arbitration community may be pressed to
lead by example and show increased efforts to turn green and go virtual.
In my view, these extrinsic values should not be implemented at any cost.
The arbitration community should continue to redefine ways to address all
concerns of due process in the context of virtual hearings. These efforts will be
critical to enhance the use of virtual hearings without any perceived downsides
or shortcomings.
B. Transparency and Disclosure of Arbitrators
Let us now consider the issue of transparency by looking at it, first, from
the angle of external values. As George notes in his article, transparency is one
of the values that the arbitration community has imported from broader,
societal values to the benefit of the arbitral process. The movement for greater
transparency started several years ago in the context of investment arbitration. A
seminal article from the New York times published more than twenty years
ago referred to arbitral tribunals as follows: “Their meetings are secret. Their
members are generally unknown. The decisions they reached need not be fully
disclosed. Yet the way a small group of international tribunals handles
disputes between investors and foreign governments has led to national laws
being revoked, justice systems questioned, and environmental regulations
challenged”. [New York Times, available at https://www.nytimes.com/2001/03/
11/business/nafta-s-powerful-little-secret-obscure-tribunals-settle-disputes-
but-go-too-far.html. A version of this article appears in print on March 11,
2001, Section 3, Page 1 of the National edition with the headline: NAFTA’s
Powerful Little Secret; Obscure Tribunals Settle Disputes, but Go Too Far,
Critics Say]. While, in my view, the article rushed into some conclusions that
were highly debatable or plainly wrong, the message was clear: a perceived
lack of transparency as the role of private adjudicators in the context of high-
stake disputes which often resulted in sizeable monetary awards against
sovereign States.
This quest for transparency has then moved to the field of international
commercial arbitration and its impact is clear: more information has become
available in a variety of ways such as the arbitral institutions’ decisions on
challenges against members of arbitral tribunals, the information about the
past and present caseload of arbitrators, the disclosure of certain aspects of
the arbitration to the public, and the publication of arbitral awards. Also,
associations embracing greater transparency to bridge informational gaps
about the experience, track record and background of arbitrators have been
created with great success within the arbitration community [See, for example,
Arbitrator Intelligence available at https://arbitratorintelligence.com/].
The demand for transparency has also prompted greater and more
extensive requests for disclosures from arbitrators, silently reshaping and
broadening the scope of arbitrators’ disclosure. The broader is the disclosure,
the greater it serves and promotes the value of transparency. But it also may
give rise to unjustifiable requests for further information, frivolous challenges,
undeserved resignation from tribunals causing disruption to arbitral proceedings,
and even actions to vacate the award. To this extent, transparency may come
at odds with other values of a pro arbitration policy such as efficiency in the
constitution of the tribunal, the parties’ right to nominate an arbitrator and,
even, the arbitrator’s own fulfillment of its mandate.
To put the issue in context, arbitration laws require the arbitrator to be
and remain independent and impartial throughout the arbitration. To ensure
these duties, arbitration requires in general that an arbitrator disclose the
parties, from his or her appointment until the end of the arbitration, any
circumstances that in the eyes of the parties could affect his or her
independence and impartiality. The arbitration community has deployed
consistent efforts to create guidelines that can shed light on the sort of facts or
circumstances that call into question an arbitrator’s independence and
impartiality and should, therefore, be disclosed. The most notable example
being the IBA Guidelines on Conflict of Interest in International Arbitration
[hereinafter “IBA Guidelines” available at https://www.ibanet.org/Media
Handler?id=e2fe5e72-eb14-4bba-b10d-d33dafee8918].
No one can doubt that the duty of an arbitrator to disclose conflicts of
interest clearly advances values that favor arbitration. First, it puts a burden
on the arbitrator to disclose potential conflicts that will serve to bridge the
asymmetries of information between two parties (and their counsel) who may
have disparate levels of resources to check on the arbitrators’ background and
relations. Second, it contributes to the legitimacy of arbitration as a dispute
resolution method by ensuring that arbitrators are not tainted or biased by
considerations of dependence or partiality towards one of the parties. Finally,
it also protects the finality of arbitral awards as it avoids or reduces the risk of
awards being attacked on grounds of irregular constitution of the tribunal or
due process. To the extent that a disclosure once made by an arbitrator is
waived by a party, this could prevent a subsequent action to vacate the award
based on the same facts already disclosed.
Soft laws like the IBA Guidelines contribute enormously to avoid confusion
as to the nature of facts that an arbitrator should disclose. But there are still a
variety of circumstances that are not identified or encapsuled in the different
situations described in guidelines of this type. Moreover, reality evolves and so
do the guidelines that continue to be nurtured by new situations not originally
foreseen or considered as warranting any disclosure. The 2014 IBA Guidelines
clearly acknowledges this: “The revised Guidelines reflect the conclusion that,
while the basic approach of the 2004 Guidelines should not be altered,
disclosure should be required in certain circumstances not contemplated in

the 2004 Guidelines.” [see, IBA Guidelines].
Take the example of arbitrators simultaneously sitting in various tribunals
at the same time. I remember a conference on international arbitration back in
2004 where someone from the audience asked the speaker, a well-known and
prominent arbitrator, why arbitrators were not disclosing the cases in which
they currently sit or have sat with the other members of the same tribunal to
which they were appointed. The speaker answered harshly “That’s non-sense.
There should not be concerns if an arbitrator sits in one or ten cases with
another arbitrator. Perhaps you are confusing the situation with that of double
hatting between counsel and arbitrator” and then went on to explain this
particular area of conflict.
Yet, recent trend shows concerns about arbitrators’ duties to disclose
relations with other arbitrators with whom they shared arbitral tribunals. In
one of the so-called Panama Canal cases, last 18 November 2021, a U.S. Court
upheld an ICC award worth over US $270 million in favor of the Panama Canal
Authority, rejecting a construction consortium’s allegations that the arbitrators
showed bias by failing to disclose their “cross-appointments” in other cases.
The case concerned the excavation of basalt used to produce concrete aggregate
for the project. The tribunal issued a partial award in 2020, determining that
Claimant (a consortium made of three construction companies) should repay
over US $270 million to Respondent and Counter Claimant (the Panama Canal
Authority), while the canal authority should pay around US $25 million to the
consortium. In this case, the Claimant moved to vacate the award on grounds
that it has learned after the award was rendered that the arbitrator nominated
by the canal authority has provided the Chair of the tribunal with a “prestigious
and lucrative” appointment as tribunal president in an unrelated ICC
arbitration, which was not disclosed. It argued this may have “influenced” the
chair to side with the canal authority party appointed arbitrator in the canal
dispute. The case is currently on appeal. One may question whether this is
sufficient ground to challenge an award, but it certainly proves that demands
for disclosure are reaching unchartered territories.
This leads to my next point. Greater disclosure also may put in conflict
internal values of arbitration that, at least theoretically, are equally loadable.
As noted, disclosure may protect the regular constitution of the tribunal and
thus the finality of the award. But excessive or exaggerate disclosure may
undermine these values. First, excessive disclosure may lower the bar to the
extent of making disclosable facts that clearly do not call into question the
arbitrator’s independence or impartiality. I remember a case in which a co-
arbitrator disclosed that he has roughly paid a monthly bill of around 80
dollars to Respondent’s company for supply of home electricity, whereas the
same company supplied energy to the whole city in which the three arbitrators
lived. One may easily conclude that requiring or making a disclosure does not
imply the actual existence of doubts as to the impartiality or independence of
an arbitrator and may not be enough to successfully challenge an arbitrator.

But demand for disclosure does not mean that an arbitrator should reveal any
conceivable matter that could relate even remotely to the parties or the case.
Such a requirement would place an enormous burden on the arbitrators’
shoulders. Second, extensive disclosures may give rise to challenges to the
tribunal that, even if unfounded, may seriously disrupt or derail the arbitral
proceedings, thus delaying the rendering of an award. Excessive and unwarranted
disclosure certainly leaves more room for opportunistic behavior from the
parties. Finally, challenges even if meritless may lead arbitrators to resign from
their mandate to avoid getting into hostile waters with the parties or becoming
exposed to greater scrutiny from third parties (be it an arbitral institution or
national courts entrusted with the power to decide on the challenge). As
arbitration, from the arbitrator’s perspective, is a reputational market, it does
not come as a surprise that many arbitrators will prefer to avoid a challenge
even if they are certain that it should not prevail.
These consequences would clearly affect the efficiency of arbitration, the
right of the parties to preserve the arbitrator of its choice and the arbitrator’s
fulfillment of its mandate.
Again, finding the right compromise between these internal values and the
increasingly important external value of transparency is not an easy task.
Arbitrators should be sensitive to the continuing demands of the users’
community and interests of all stakeholders in arbitration. But arbitration also
exists within a certain legal framework with given principles that should be
observed in a consistent manner. Statements of disclosure should not be used
as ammunition to attack the efficiency or legitimacy of the arbitral process.
Chapter 30
CAN ANTI-ARBITRATION INJUNCTIONS BE
PRO-ARBITRATION?
Daniel Allman*
As Professor Bermann reminds us, the question of what it means to be

“pro-arbitration” is too often examined through a narrow lens (George A.
Bermann, What Does it Mean to Be “Pro-Arbitration”?, 34 ARB. INT’L 341, 341
(2018)). Rather than assessing a practice or policy only by reference to values
narrowly associated with arbitration, such as party autonomy and procedural
efficiency, counsel and arbitrators alike should reflect both on the trade-offs
between pro-arbitration considerations and on the importance of extrinsic
considerations to the well-being of international arbitration. In the final analysis,
it is extrinsic values such as fairness, professionalism, and transparency that
determine arbitration’s legitimacy.
The importance of extrinsic values is apparent in the uptake of practices
that seem not to advance arbitration’s interests narrowly conceived. For example,
although soft law instruments such as the IBA guidelines on party representation
and conflicts of interest impose constraints on traditional notions of autonomy
and efficiency, they are nevertheless embraced because they promote broader
norms of fairness and professionalism.
This reflection addresses an altogether more divisive practice: the grant of
anti-arbitration injunctions. It describes the approach taken by Australian courts
to this remedy, and considers whether anti-arbitration injunctions enhance or
diminish the legitimacy of international arbitration.
I. THE DEBATE OVER ANTI-ARBITRATION INJUNCTIONS
Arbitration practitioners are familiar with, and favourable towards, anti-

suit injunctions. An anti-suit injunction is an order of a court or tribunal that
a party not maintain proceedings in a forum other than the chosen arbitral
forum. Like a stay or dismissal, or an order compelling arbitration, the purpose of
an anti-suit injunction is to reinforce the parties’ contractual promise to arbitrate.
By contrast, the effect of an anti-arbitration injunction is to bring actual or
threatened arbitration to an end. It is an order of a court that a party not proceed
with arbitration or that it refrain from commencing arbitration in the first place.
* Daniel Allman is a Special Counsel at Norton Rose Fulbright, based in Sydney, where he
specializes in cross-border dispute resolution. He is dual-qualified in Australia and New York,

and currently serves as the regional chair for Oceania of Young ITA. He received his LL.M. from
Columbia University and his LL.B. and B.A. from the University of Melbourne.
179
Many arbitration practitioners react viscerally to the suggestion that a

court would restrain commercial parties from arbitrating. On their view, the
grant of an anti-arbitration injunction “against an international arbitration subject
to the New York Convention is generally contrary to the basic legal framework
established by the Convention; that conclusion applies regardless whether the
anti-arbitration order is issued by a court in the arbitral seat or otherwise”
(Gary B. Born, INT’L COMM. ARB. (3rd ed. 2021), 1983). They fear that anti-
arbitration injunctions often “are part of deliberately obstructionist tactics,
typically pursued in sympathetic local courts, aimed at disrupting the parties’
agreed arbitral mechanism” (id., at 1980).
Others see less cause for alarm, particularly where an injunction is needed
to restrain an excess of jurisdiction on the part of the tribunal. As then Judge
Breyer observed while serving on the U.S. District Court of Appeals for the First
Circuit, “[t]o allow a federal court to enjoin an arbitration proceeding which is
not called for by the contract interferes with neither the letter nor the spirit of
this law [the Federal Arbitration Act]. Rather, to enjoin a party from arbitrating
where an agreement to arbitrate is absent is the concomitant of the power to
compel arbitration where it is present.” (Societe Generale de Surveillance, S.A.
v. Raytheon European Mgmt. and Sys. Co., 643 F.2d 863, 868 (1st Cir. 1981)
(emphasis in original)).
II. THE APPROACH TAKEN BY AUSTRALIAN COURTS
In Australia, international arbitration is governed by the International

Arbitration Act 1974 (Cth). Section 16(1) of the Act provides that the UNCITRAL
Model Law has the force of law in Australia, and the Model Law in turn states
that its provisions apply only if the place of arbitration is Australia. Article 5
of the Model Law stipulates that “[i]n matters governed by this Law, no court
shall intervene except where so provided in this Law.” The Model Law does not
otherwise provide for the grant of anti-arbitration injunctions.
In that way, it may be contended that Australian law, at least on the face of
the International Arbitration Act 1974 (Cth), does not permit anti-arbitration
injunctions against international arbitration seated in Australia. It is certainly
true that Australian courts have found their inherent power to intervene in
domestic arbitration to be limited by the equivalent provision of the state
Commercial Arbitration Acts (see Hancock Prospecting Pty Ltd v. DFD Rhodes
Pty Ltd [2020] WASCA 77; Transurban WGT Co Pty Ltd v. CPB Contractors Pty
Limited [2020] VSC 476).
However, article 5 of the Model Law does not apply to foreign-seated
arbitration. Two decisions of the Federal Court of Australia demonstrate a
willingness to enjoin international arbitrations seated elsewhere.
In Hi-Fert Pty Ltd v. United Shipping Adriatic Inc [1998] FCA 1426, the
Federal Court granted an anti-arbitration injunction on the basis that a London
CAN ANTI-ARBITRATION INJUNCTIONS BE PRO-ARBITRATION? 181
arbitration clause in a bill of lading was invalid under the Carriage of Goods by
Sea Act 1991 (Cth), which constituted overriding mandatory legislation.
More recently in Kraft Foods Group Brands LLC v. Bega Cheese Limited
[2018] FCA 549, the Federal Court granted an anti-arbitration injunction
enjoining New York-seated arbitration on the basis that the overlap between
litigation proceedings in Australia and arbitration proceedings in New York,
both of which were commenced by Kraft, created a risk of inconsistent results.
Notably, the Federal Court disagreed with Kraft that anti-arbitration
injunctions “fall to be applied through a different prism and with extra caution”
when compared with anti-suit injunctions, and rejected the test adopted by
English courts to the effect that anti-arbitration injunctions should be used
only in “exceptional circumstances” (see also Andrew S. Bell, The Rise of the
Anti-Arbitration Injunction, October 15, 2020, speech to 3rd annual ADR Address
of the Supreme Court of NSW). According to O’Callaghan J, “[o]f course, caution
in the exercise of the jurisdiction to grant any injunction is always needed …
But no part of the exercise of the court’s discretion on an application for an
anti-arbitration injunction involves the court asking itself, or needing to
determine, whether the relief claimed is ‘exceptional’” (Kraft Foods Group
Brands LLC v. Bega Cheese Limited [2018] FCA 549; (2018) 358 ALR 1, [100]).
It appears therefore that, when it comes to foreign-seated arbitrations,
Australian courts will take a similar approach to anti-arbitration injunctions as
they take to anti-suit injunctions. In addition to enjoining arbitration on account
of an express contractual promise not to arbitrate, Australian courts are willing
to grant anti-arbitration injunctions if it would be vexatious or oppressive to
permit the foreign arbitration to continue or if required to protect the integrity
of the court’s own processes once set in motion.
III. THE QUESTION OF LEGITIMACY
Although anti-arbitration injunctions against foreign-seated arbitrations

sit uncomfortably with the Kompetenz-Kompetenz principle and with the
supervisory role of the arbitral seat, Professor Bermann implores us to think
more deeply. He suggests that the catalogue of pro-arbitration criteria should
include asking “to what extent does a given policy or practice enhance
international arbitration’s legitimacy overall” (Bermann, id., at 341, 352). So,
how do anti-arbitration injunctions measure on that score?
The grant of an anti-arbitration injunction enhances the legitimacy of
international arbitration to the extent it enjoins an excess of jurisdiction by the
tribunal. Where arbitration has no proper contractual basis, for example, or
where arbitrating would lead to unconscionable outcomes, it is appropriate for
a court to intervene. By preventing abuse of legal process, anti-arbitration
injunctions can promote the extrinsic value of fairness. This outcome is not
arbitration-unfriendly: if arbitral excesses are bad for the health of arbitration,
then injunctions restraining them must be good.
Nevertheless, courts should be circumspect about denying that the remedy

is exceptional (see Richard Garnett, Anti-Arbitration Injunctions; Walking the
Tightrope, 36(3) ARB. INT’L 347, 369–371 (2018)). Particularly in situations
where a court is concerned to protect the integrity of its own processes in case
of concurrent proceedings, it would be preferable to recognise the exceptional
nature of anti-arbitration injunctions. Otherwise, a party wishing to undermine
its arbitration agreement has an incentive to bring overlapping claims before
the court.
Chapter 31
PRO-ARBITRATION APPROACH TO COSTS
ADJUSTMENTS
Daniel Hrčka*
The focus of this essay is the pro- and anti-arbitration aspects of costs
adjustments (apportionments) in arbitral awards. The importance of costs
orders in international arbitration cannot be overestimated. Rising party fees
and tribunal costs play a significant role in the decision whether to actually file
a claim and also in subsequent procedural conduct. The times when speed and
low costs were considered as clear advantages of arbitration are not necessarily
over. However, parties frequently consider the risk of expensive protracted
arbitration proceedings.
In his paper dedicated to the actual meaning of pro-arbitration methods and
policies, George Bermann argues that policies and practices affecting international
arbitration’s wellbeing are manifold. The same policy can on one hand
promote goals strived for by the arbitration community while on the other
hand fail to advance arbitration’s purposes in other criteria (George A. Bermann,
“What Does it Mean to Be ‘Pro-Arbitration’?”, 34 ARB. INT’L 341 (2018)). This
is especially relevant given that the factors influencing what is “pro” and what
is “anti” arbitration are numerous. Both academics and practitioners should
thus take as broad a view as possible to avoid advocating for one view while
ignoring other factors of proposed policies potentially adverse to arbitration.
This also applies to considerations on costs adjustments, no matter how pro-
arbitration, e.g. the loser pays principle (as defined below) may seem.
To give the analysis some practical considerations, I am going to look at
data on costs adjustments in investor-State dispute settlement (ISDS) as these
awards are in a large number of cases public. In a recent empirical study, Allen
& Overy examined over 500 ISDS cases under various arbitration rules and
gave a comprehensive account of how long ISDS proceedings last, how much
they cost and how tribunals allocate those costs (Matthew Hodgson, Yarik
Kryvoi and Daniel Hrcka, “2021 Empirical Study: Costs, Damages and Duration
in Investor-State Arbitration”, Allen & Overy and BIICL, London, 2021 (Study)).
Mindful of Bermann’s reserved approach to ISDS in his pro-arbitration enquiry
according to which the terms pro-arbitration and anti-arbitration have an
especially hollow ring in ISDS, I respectfully disagree, at least when we speak
about the issue of costs and their apportionment. In the end, methods of costs
adjustment are the same in ISDS and in international commercial arbitration.
* Daniel Hrčka is an Associate in the international arbitration department in the Allen &
Overy Prague office and a Harlan Fiske Stone Scholar at Columbia Law School in New York, 2019.
183
I. THEORETICAL APPROACHES TO COSTS ADJUSTMENTS
When it comes to apportionment of costs, tribunals typically choose between

two approaches. According to the “pay your own way” approach, each party bears
its own costs and tribunal costs are divided between the parties in equal shares. On
the other hand, under the “costs follow the event” approach (loser pays), the
successful party recovers all reasonable costs incurred in connection with the
arbitration from the losing party. There is also a third, middle approach: “relative
success apportionment” means that tribunals apportion costs based on the parties’
relative success on the different issues raised during the proceeding. Consequently,
tribunals decide in two stages. In the first stage, they decide which of the three
approaches described above shall be adopted. In the second stage, if it is decided
that the losing party shall at least partly pay the costs of the prevailing party, they
choose whether one party should pay the other side’s party and tribunal costs in
full (fully adjusted costs order) or whether one party must pay only part of the
other side’s party and tribunal costs (partially adjusted costs order).
Neither the ICSID Rules nor the UNCITRAL Rules provide relevant factors
to decide on costs allocation. For instance, the 2010 UNCITRAL Arbitration
Rules state that arbitration costs including legal costs and other costs incurred
by the parties in relation to the arbitration shall “in principle” be borne by the
unsuccessful party (Article 42(1) mentions “the costs of arbitration” without
distinguishing between tribunal and legal representation costs). ICSID Arbitration
Rules leave the decision on costs allocation entirely at the discretion of tribunals,
although ICSID released a Working Paper with proposed amendments to the
ICSID Arbitration Rules. With respect to costs allocation, tribunals will have to
consider, among others, the outcome of the proceeding, the conduct of the
parties, the complexity of the issues and the reasonableness of the costs
claimed (ICSID Working Paper #6, Proposal for Amendment of the ICSID Rules,
November 2021, Proposed Rule 52(1)).
Currently, however, a tribunal may still apportion those costs between the
parties if it determines that apportionment is reasonable, taking into account
the circumstances of the case. The decisions of tribunals suggest that such
factors include relative success on the various issues in dispute, procedural
misconduct, complexity and novelty of legal issues, gravity of any breaches by
the State, local law of the respondent State, proportionality of incurred costs
or equitable concerns.
Subject to any mandatory provisions in the arbitral rules, it is for tribunals
to decide whether to award party costs, tribunal costs or both to the successful
party, following one of the three approaches above. The Study has shown that
there has been a gradual shift in investment arbitral practice towards recognising
the “costs follow the event” principle or the “relative success” approach. In
particular, 77% of costs orders in awards issued between June 2017 and May
2020 were either fully or partially adjusted. This compares to just 44% adjusted
costs orders in cases decided before December 2012.
PRO-ARBITRATION APPROACH TO COSTS ADJUSTMENTS 185
Costs adjustments in cases up to December 2012

Fully adjusted
Unadjusted (10%)
(57%)
Partially
adjusted
(33%)
Pool: 198 cases
Costs adjustments in cases from January 2013 to May 2017

Fully
adjusted
(7%)
Unadjusted
(36%)
Partially
adjusted
(57%)
Pool: 125 cases
Costs adjustments in cases from June 2017 to May 2020
Fully
adjusted Unadjusted (23%)
(16%)
Partially
adjusted
Pool: 109 cases (61%)
When tribunals decide to apportion spent costs, this usually applies to both
party fees and tribunal costs. Of the 109 cases made public with data on costs
adjustments since June 2017, 58% (i.e. 64 cases) adjusted both party and tribunal
costs (at least to some degree). This is more than three quarters of all adjusted
costs orders in this period (84 decisions). Before June 2017, tribunals adjusted
both tribunal and party costs in just two-thirds of adjusted costs orders.
Number of awards with adjusted costs orders by reporting period
Total up to May 2020 (pool:431) 42% 41% 6% 11%
June 2017 - May 2020 (pool: 109) 23% 59% 5% 14%
Total up to May 2017 (pool: 322) 49% 34% 7% 10%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Unadjusted Tribunal & Party Costs Adjusted

Only Party Costs Adjusted Only Tribunal Costs Adjusted
Tribunals also appear more ready to scrutinise the reasonableness of costs

claimed by parties. Fully adjusted costs orders are far less common than they
used to be, with only 17 fully adjusted costs orders issued between June 2017
and May 2020 (out of 109 cases with available data). This trend may deter
excessive spending. The above figures on costs adjustments must be considered
in connection with statistics showing high party fees. For respondent States,
the mean costs incurred in an ISDS proceeding are around US$4.7 million. For
investors, the mean costs exceed US $6.4 million (statistics taken from 273
awards issued up to May 2020 containing data on investors’ party fees and 267
awards issued up to May 2020 containing data on respondent States’ party fees).
II. ARE COSTS ADJUSTMENTS PRO-ARBITRATION?
Costs adjustments can generally be considered as a pro-arbitration practice.

This corresponds to the finding in the previous section that costs adjustments
are more common in decisions of ISDS tribunals in recent years. This finding is
not surprising. Civil procedure codes in several countries contain provisions
under which the court is free to determine that costs of the proceeding shall be
borne by the losing party, taking into account procedural conduct of the
parties. Costs adjustments thus represent an element of fairness that should
PRO-ARBITRATION APPROACH TO COSTS ADJUSTMENTS 187
arguably be present in every pro-arbitration practice. One can say it’s just and
equitable for the losing party to bear, at least partly, party and tribunal costs.
They also contribute to transparency as tribunals shall state the reasons why
costs were adjusted this or the other way when parties invested significant
financial sources, time and effort in advocating their positions.
However, turning back to the conflicting consequences of measures which
may seem pro-arbitration from one perspective, but anti-arbitration from
another, it is important to consider costs adjustments also from this broader
perspective. Costs adjustments relate to several factors affecting their pro- or
anti-arbitration character:
a) costs adjustments can substantially affect costs and duration of

arbitration proceedings;
b) given the substantial amounts spent by parties on their legal
representation, proper reasoning on costs apportionment promotes
transparency;
c) for the same reason, the tribunal’s reasoning on costs allocation helps
to achieve a more accurate decision as it touches upon all claims
submitted by parties (i.e. claimed damages as well as remuneration of
spent costs); and
d) costs adjustments help to achieve fairness of an award (and thus
increases the ability to withstand challenges in an annulment or
enforcement action).
Mindful of the above contributions to fairness and transparency, are there

any factors against costs adjustments for their anti-arbitration nature? Let’s
have a look at the process leading to a proper and just costs adjustment. First,
parties must submit a reasoned submission with exhibits actually justifying all
incurred costs. This will probably need to be supported by timesheets, invoices
and other documents proving the costs, all of this leading to higher party fees
in arbitration and longer duration of the case. Secondly, tribunals must read
and consider those submissions and exhibits, and subsequently reflect them in
an award. All this further extends the duration of the case and increases tribunal
costs (before May 2017, tribunals on average devoted only 10.4 paragraphs in
their final awards to discuss costs. This number has now doubled to an average
of 20.4 paragraphs in decisions issued between June 2017 and May 2020).
These concerns should not be taken lightly as the mean duration of an ISDS
case reaches almost 4.5 years (this figure takes into consideration 434 decisions
that were the subject of the Study).
Adopting such a practice which places higher emphasis on the reasonableness
of incurred costs will be difficult especially in the beginning. Arbitration rules
usually provide no guidance and there is no established arbitral practice on
what is and what is already not reasonable.
Numerous questions arise that sooner or later will have to be answered by

tribunals. For instance, what emphasis should be given in costs apportionment
to an unsuccessful jurisdictional objection of the respondent State if that State
eventually prevailed on the merits? If party fees of an investor are significantly
higher than the fees of a respondent State or vice versa, when is this difference
justified and when can we speak of unnecessary spending? How shall tribunals
consider lengthy submissions of prevailing parties when their case can be proven
by fewer authorities and exhibits? And how can these procedural economy
considerations get along with the right to be heard and present the case?
Consequently, sometimes it’s difficult to decide whether a particular argument
covered in legal analysis or a particular witness statement used to prove a stated
fact was reasonable or not. Drawing a line between partisan and delaying tactics
and the necessity to ensure proper defence of claims can be difficult to achieve.
Moreover, sometimes too much attention to costs apportionment can be
counterproductive. In a case with a low amount in dispute, of rather short
duration and with low party fees, parties may actually prefer to quickly resolve
the case through an unadjusted or fully adjusted costs order instead of incurring
further costs in justifying their fees under the relative success apportionment
approach.
III. CONCLUSION
Notwithstanding the considerations above, the author still thinks that after
balancing all the factors above, costs adjustments should be considered as pro-
arbitration. Although they may lead to longer and more costly arbitration
proceedings due to longer costs submissions and longer considerations by
tribunals, they promote the values of fairness and transparency. Such practice
is justified “in the interest of fundamental fairness, a broader legal norm and societal
value” (George A. Bermann, “What Does it Mean to be ‘Pro-Arbitration’?”, 34
ARB. INT’L 349 (2018)). It can be argued that costs adjustments embody not
just pro-arbitration values but also the extrinsic principles of justice which
justify using them, irrespective of the above mentioned negatives. Nevertheless,
reaching a proper balance on what should be particularly done in each case to
achieve a fair costs order might be more difficult than originally thought.
Chapter 32
THE HIDDEN PRO-ARBITRATION NATURE OF
JUDGE RAKOFF’S DECISION ON ARBITRAL
SUBPOENAS TO THIRD PARTIES
Daniel Schimmel*
In his article, What Does it Mean to Be Pro-Arbitration?, Professor Bermann

writes that it behooves the arbitration community “to think more deeply than
it customarily does about what it means to be pro-arbitration,” and that “pursuing
a pro-arbitration path, in one sense of the term, may operate at cross-purposes
with what may legitimately be considered as pro-arbitration in one or more
other senses of the term.” Judge Rakoff’s decision in Broumand v. Joseph shows
that a ruling that certain arbitrators have criticized as anti-arbitration, because
it limits their authority to hear from third parties, actually promotes the goals
of rendering arbitration more distinct and economical than U.S.-style litigation
[Broumand v. Joseph, 522 F. Supp. 3d 8 (S.D.N.Y. 2021)].
In past arbitrations seated in the United States, arbitrators would frequently
issue subpoenas to third parties for documents or testimony. The power to
compel discovery from non-parties is set forth in Section 7 of the Federal
Arbitration Act (FAA), which provides in relevant part that “arbitrators … may
summon in writing any person to attend before them or any of them as a
witness and in a proper case to bring with him any book record, document, or
paper which may be deemed material as evidence in the case.”[9 U.S.C. Section 7]
Consistent with Section 7 of the FAA, the Second Circuit explained in Life
Receivables Trust that arbitrators may order any person to produce documents
so long as that person is called as a witness at a hearing, regardless of whether
that hearing is the ultimate hearing on the merits [Life Receivables Trust v.
Syndicate 102 at Lloyd’s of London, 549 F.3d 210 (2d Cir. 2008), at 218].
Arbitrators often have not considered the questions of whether the subpoenas
were enforceable; when a party asked for a subpoena, they would frequently
issue it. Whether the subpoenas were consistent with the text of the FAA or
any limitations imposed by the Federal Rules of Civil Procedure (FRCP) was
often not a consideration, and the pandemic, with its readily available virtual
* Daniel Schimmel leads the international litigation and arbitration practice of Foley Hoag’s
New York office. He has served as Counsel, Chair, Sole Arbitrator, Co-Arbitrator, Emergency
Arbitrator, and Appellate Arbitrator in more than 65 international and domestic arbitrations.
Mr. Schimmel is a Board Member and Officer of the Chartered Institute of Arbitrators, New York
Branch and a Fellow of the Chartered Institute of Arbitrators. Eva Paloma Treves made a
significant contribution to the drafting of this essay. Ms. Treves is a Senior Associate in Foley
Hoag’s International Litigation & Arbitration Department, based in New York.
189
conference services, reinforced the practice of issuing subpoenas calling for

third parties to appear at virtual hearings.
Although Rule 45(c) of the FRCP provides that a subpoena “may command
a person to attend a … deposition … only within 100 miles of where the person
resides” [Fed. R. Civ. P. 45(c)(1)(a)], certain courts agreed that “[a virtual
deposition] no longer requires [the deponent] to travel more than 100 miles
(or at all) to comply” [In re Newbrook Shipping Corp., 498 F. Supp. 3d 807 (D.
Md. 2020), at 815. See also, Int'l Seaway Trading Corp. v. Target Corp., Case No.
0:20-mc-00086-NEB-KMM (D. Minn. Feb. 22, 2021), at 10–11 (“Given the plain
language of Rule 45(c), a remote deposition subpoena requiring [the deponent’s]
compliance in St. Louis does not run afoul of the Rule simply because it was
issued by an arbitrator in Minneapolis.”)]. These courts declined to address the
argument that a subpoena compels the deponent to comply outside of the
geographical bounds of Rule 45(c). Likewise, although Section 7 of the FAA
grants the authority to district courts to “compel the attendance [of the deponent]
before said arbitrator”, these courts have noted that “leave to conduct depositions
by telephone should be liberally granted” [Lopez v. Cit Bank, N.A., Case No. 15-
cv-00759-BLF (HRL) (N.D. Cal. Dec. 18, 2015), at 3].
At a first glance, these decisions are simply the reflection of the modern
world, with its technology and ease of use, seeping into arbitration practice.
They appear pro-arbitration by granting arbitrators broad authority to issue
subpoenas to third parties. By taking a closer look, however, “pursuing what
appears to be a pro-arbitration strategy … actually discredits arbitration and
ultimately operates to arbitration’s detriment.” [George A. Bermann, What
Does it Mean to be “Pro-Arbitration”?, 34 ARB. INT’L 341 (2018), p. 342. See also,
William W. Park, “Arbitration and Fine Dining: Two Faces of Efficiency”, in The
Powers and Duties of an Arbitrator (P. Shaughnessy and S. Tung eds.) (2017),
251]. By issuing all of the requested subpoenas to obtain discovery from third
parties, neither the parties nor the arbitrators had to “think twice” about whether
the requested testimony was truly needed, and whether it was important enough
to justify the deponent’s presence. This multiplication of subpoenas often meant
increased time and costs and replicated devices and burdens of U.S. litigation.
In Broumand, the underlying arbitration involved the petitioner’s claim
that two individuals misdirected assets of an entity in which the petitioner
maintained an interest. The arbitrator issued subpoenas for documents to two
non-parties who were officers of the corporation. The arbitration was seated
in New York while the respondents were domiciled in Virginia and California.
Although initially the arbitrator had compelled the non-parties to appear at an
evidentiary hearing in New York, the arbitrator then decided that all hearings
would proceed via video conference. After the third parties ignored the
subpoenas, the petitioner filed a petition in the Southern District of New York
to compel their compliance.
Although Judge Rakoff began his analysis with the first hurdle for an
arbitral subpoena issued to an unwilling third party, i.e. personal jurisdiction,
PRO-ARBITRATION NATURE OF JUDGE RAKOFF’S DECISION 191
and then proceeded to considerations of due process, the most relevant

portion of his decision addresses the enforcement of subpoena [Id., Section II
“Enforcement of the Subpoena”]. Judge Rakoff analyzed the geographic limitation
in FCRP Rule 45(c) and the so-called “presence” requirement reflected in
Section 7 FAA.
With respect to geographic constraints, Judge Rakoff analyzed whether
arbitral subpoenas are required to comply with the 100-mile limitation, and
whether remote testimony can be used to circumvent that limitation. Judge Rakoff
has described his decision as a technical one [https://radio.amicus-curiae.net/
tag/jed-s-rakoff/]. He ruled that the 100-mile limitation is a “straightforward”
requirement and does not entangle a district court in the merits of the
arbitration. Consequently, although the petitioner had argued that the subpoenas
were enforceable because the respondents could testify via video conference,
and although Judge Rakoff himself noted that several out-of-circuit district courts
had approved the use of remote testimony as a way around the 100-mile
limitation, Judge Rakoff followed a different approach: “the text of Rule 45(c)
… speaks, not of how a person would have to travel, but simply the location of
the proceeding at which a person would be required to attend.” [Id., at 24]
Judge Rakoff added that any other reading would render the 100-mile
limitation a nullity and “bestow upon any arbitrator … the unbounded power
to compel remote testimony from any person residing anywhere in the country.”
[Id.] As a result, Judge Rakoff granted the respondents’ motion to dismiss the
petitioner’s enforcement proceeding based on the 100-mile limit provided for
by Rule 45(c).
While Judge Rakoff dismissed the case on the basis of Rule 45(c), he also
addressed the presence requirement of Section 7 FAA as an independent basis
to reject the subpoenas. As mentioned above, the text of Section 7 FAA does not
explicitly authorize subpoenas for documents as opposed to witness testimony.
Nevertheless, the Second Circuit and other circuits have authorized a
workaround by holding that an arbitrator may require a witness to attend a
preliminary hearing before the arbitrator for the sole purpose of producing
subpoenaed documents [Life Receivables Trust v. Syndicate 102 at Lloyd’s of
London, 549 F.3d 210 (2d Cir. 2008), at 218. See also, Hay Group, Inc. v. E.B.S.
Acquisition Corp., 360 F.3d 404, 407 (3d Cir. 2004) (Alito, J.) (“Section 7 ’s
language unambiguously restricts an arbitrator’s subpoena power to situations
in which the non-party has been called to appear in the physical presence of
the arbitrator and to hand over the documents at that time.”); CVS Health Corp.
v. Vividus, LLC, 878 F.3d 703, 708 (9th Cir. 2017) (“Given the clear statutory
language, we reject the proposition that section 7 grants arbitrators implicit
powers to order document discovery from third parties prior to a hearing.”);
Managed Care, 939 F.3d at 1160 (“[T]he plain language of the statute is
unambiguous in requiring witnesses to appear before an arbitrator and bring
any documents with them, thus prohibiting pre-hearing discovery from non-
parties.”)]. According to Judge Rakoff, it is precisely this presence requirement
that forces “the party seeking the non-party discovery—and the arbitrators
authorizing it—to consider whether production is truly necessary.” [Broumand
v. Joseph, 522 F. Supp. 3d 8 (S.D.N.Y. 2021), at 24 citing Life Receivables Trust v.
Syndicate 102 at Lloyd’s of London, 549 F.3d 210 (2d Cir. 2008), at 218]
In Broumand, the petitioner argued that, given the extraordinary
circumstances posed by the pandemic, an arbitrator could satisfy the presence
requirement by videoconference. Judge Rakoff did not agree on two grounds.
First, “[h]owever valid petitioner’s policy concerns may arguably be, they cannot
trump the plain meaning of Section 7 of the FAA.” [Id., at 25] Second, allowing
video testimony would undermine the purpose of the presence requirement.
In fact, as Judge Rakoff concluded “[t]he principle … is to force an arbitrator to
think twice before issuing an arbitral subpoena. Allowing arbitrators to
subpoena nonparties for discovery without requiring the arbitrators to
convene and preside over a physical hearing would largely undermine that
calculation.” [Id., at 25 (emphasis added)]
Requiring an arbitrator to think twice before issuing a subpoena to a third
party means that arbitrators will not reflexively sign subpoenas, but will
consider whether that particular witness is important enough to justify their
presence. It will help reduce the costs and time of arbitration.
In addition, it is essential for arbitrators and parties to show their personal
commitment to the arbitral process, which means in certain circumstances to
be physically present. Judge Rakoff’s decision may require arbitrators to travel,
i.e., make a personal commitment, if they wish to hear from a particular third
party. Making such a personal commitment will reinforce the credibility of
arbitration as a flexible dispute-resolution mechanism in which arbitrators
actually exercise sound discretion and flexibility on matters of arbitral
procedures instead of reflexively adopting the tools of U.S. litigation.
Chapter 33
A SOCIOLOGY OF BEING PRO‐ARBITRATION:
A LOOK AT SOME COMMUNITY RITUALS
THROUGH THE PRO‐ARBITRATION LENS
David S. Blackman*
George A. Bermann observes in his 2018 article, “What Does it Mean to Be

‘Pro-Arbitration?’”, published in Arbitration International, that being “pro-
arbitration” is a complicated proposition that requires balancing: “managing
the trade-offs that competing pro-arbitration considerations entail.” Rather
than being an innate quality of a particular policy or practice, it is a label or
conclusion that may properly attach when that policy or practice appears to
balance successfully the “trade-offs” between arbitration’s frequently conflicting
goals. Thus, Prof. Bermann explains, being “pro-arbitration” often may require
a wider view—one that accounts for the legitimacy of the arbitration enterprise
as a whole within the broader legal and cultural landscape’s “extrinsic
considerations.”
As with many of Prof. Bermann’s observations, this gets at a core proposition
worth considering in some depth. To the extent that Prof. Bermann is correct,
practitioners of international arbitration might also give some thought as to
what kinds of social practices and structures are “pro-arbitration,” just as they
consider what legal policies and principles are “pro-” or “anti-” arbitration
developments. What kinds of social structures enhance, or fail to enhance, the
competing considerations of arbitration, and, in particular, the broader
legitimacy of the enterprise? This essay examines a few ways in which the
international arbitration community’s social practices might be considered
pro-arbitration, and how they might be made more so.
In so doing, the essay takes as a given that international arbitration is a
coherent social field with a set of actors—users, practitioners, arbitrators,
experts, academics, institutions, and so on—and a set of common practices and
shared values. The premise is contestable: for example, the late Emmanuel
Gaillard observed in his 2015 article “The Sociology of International Arbitration”
that international arbitration had already made a “striking evolution” from a
“solidaristic” to a “polarized” model. But in relative terms, the polarization of
international arbitration is still less than the polarization of other communities
* David S. Blackman is an Associate at Chaffetz Lindsey LLP, where his practice focuses on
international arbitration and litigation matters. The views and opinions expressed here are
solely the author’s, and do not necessarily reflect those of his colleagues, the firm, or its clients.
The author would like to extend his thanks to Gretta Walters for her invaluable comments on
the draft, and it is no mere form of words to say that all the remaining errors are his own.
193
over the same time period, and considerable cohesion appears to persist. This
essay proceeds on that assumption, and takes three examples of practices or
social “rituals” that traditionally have contributed to the cohesion of the
international arbitration community, as noted by Prof. Gaillard. Using the
framework put forward by Prof. Bermann, it then explains that these “rituals”
can have both “pro-arbitration” or “anti-arbitration” effects, depending on the
values we choose to prioritize in our “ritual” practice.
I. PRACTICE 1: HEARINGS
The first ritual is the international arbitration hearing. The anthropologist

Clifford Geertz in The Interpretation of Cultures explained that it is in and
through ritual that the “conviction that religious conceptions are veridical and
that religious directives are sound is somehow generated.” From this symbolic
perspective, ritual allows and creates meaning and legitimacy. This seems like
a reasonable description of the legitimizing function of the hearing in international
arbitration: it is, in part, the ritual of the hearing that grants the imprimatur of
legitimacy to the resulting award.
Changes to the ritual of the hearing have been one of the most striking
disruptions to the international arbitration community during the COVID-19
pandemic, as there has been an overwhelming adoption, out of necessity, of
remote hearings. In response, the ever-engaged arbitration community has
spilled much ink (or, at least, employed many keystrokes) in questioning whether
virtual hearings will be here to stay, celebrating their flexibility, lamenting the
loss of in-person hearings, or some combination of the above.
In those different reactions, we can see the same conflict of values that
animates many of the debates across the international arbitration field. On the
one hand, virtual hearings may be more economical. Perhaps also they effectuate
the likely intentions of the parties because they allow the arbitration clause to
be given meaningful effect even in a global pandemic emergency. But, on the
other hand, maybe they impinge on a party’s right to be heard. Perhaps they
detract from the accuracy of arbitral decision-making through the absence of
some ineffable quality of in-person witness testimony. As with so many issues
in arbitration, then, we are faced with the “pro-arbitration trade-offs” that
Prof. Bermann has identified.
Because hearings perform an important social function for the international
arbitration community as a ritual that binds the community as a social field,
the remote hearing can also be analyzed as pro- or anti-arbitration across that
social dimension. Do remote hearings perform the same ritualistic functions as
in-person hearings, and if so, do they perform it satisfactorily?
Even before the wider adoption of remote hearings, differing expectations
for hearings in different styles of arbitration undoubtedly existed. For example,
as Prof. Gaillard noted:
A SOCIOLOGY OF BEING PRO-ARBITRATION 195
The diversification of the type of disputes susceptible of being resolved

through arbitration has led to a corresponding diversification of the
hearing rituals. Highly politicized investment disputes require prestigious
venues possessing all the ornaments associated with the image of
international law, such as the Peace Palace in The Hague. Conversely,
commercial arbitrations opposing long-term business partners will be
conveniently handled in ordinary conference rooms cluttered with a
forest of computers, connoting the efficiency of a business-like setting.
May virtual hearings then be categorized as simply another example of the

“diversification of the hearing ritual[]”? Perhaps if used judiciously and with
the question of whether it is “pro-” or “anti-” arbitration at front of mind, it can.
If the diversification of hearing practice is primarily a reaction to the social and
cultural needs of the parties—the need for legitimation, whether through
formality or its opposite—the uniform adoption of remote hearings will likely
be “anti-arbitration” for at least some users. For example, it is likely that
prestige of a venue, the “ornaments associated with the image of international
law,” is more difficult to convey, and lacks the same impact, when transmitted
digitally in a remote hearing. By contrast, as ordinary business is increasingly
conducted via videoconference and from home offices, a “conference room[]
cluttered with a forest of computers” may no longer connote, for sophisticated
commercial parties, any “efficiency” but rather will be more likely considered
an intolerably inefficient anachronism.
II. PRACTICE 2: AWARDS AND ACCOLADES
A second social ritual of the international arbitration community is the

“recognition tournaments” in which members of the community compete for
vocational recognition and esteem. Global Arbitration Review (GAR) and
Chambers may be some of the best known dispensers of such accolades, but
they are far from the only ones. Firms are ranked in every conceivable category
and across every conceivable metric; practitioners are sorted into bands;
“rising stars” are noted and catalogued with an interest usually reserved to the
astronomical domains.
At first blush, we might think that this is a facet of international arbitration
practice that is neither “pro-“ nor “anti-“ arbitration. Its effect on users’ abilities
to resolve their disputes in an economical or just manner is not readily apparent.
It has no effect on the enforceability of arbitral awards, nor will any national
court interfere in any arbitration as a result.
Yet while this particular ritual—which is far from unique to the international
arbitration community—can fill important legitimizing roles for the practice
of international arbitration, it can also do the opposite. As strange as it may
seem, the practice of giving awards to arbitration practitioners can be an “anti-
arbitration” move when understood through the social lens.
As Prof. Gaillard noted, these types of rituals both “naturalize and justify
social stratification” and “[y]et they may also accelerate the emergence of new
elites.” They “distribute prestige and legitimacy in the field” and also “legitimize
the field vis-à-vis outside players.” Due to these dueling functions, such
recognition tournaments can be profoundly anti-arbitration when, for instance,
they reify hierarchies of privilege rather than distributing legitimacy to a broad
and diverse group of practitioners. They could be dangerously anti-arbitration
if their distribution of legitimacy within the field fails to correspond meaningfully
to extrinsic expectations of legitimacy distribution from the broader world,
causing the whole international arbitration community to appear out of touch,
untrustworthy, or otherwise illegitimate. They can be anti-arbitration if, in the
proliferation of such recognition tournaments, they become so devalued as to
no longer be effective in performing these functions. By the same token, they
can serve essential pro-arbitration purposes when they are inclusive and promote
diversity in the field, or where they enhance transparency and openness—and
thereby the legitimacy of the international arbitration enterprise.
III. PRACTICE 3: CONFERENCES
As a final example of the “pro-ˮ and “anti-ˮ arbitration possibilities of the

international arbitration community’s social rituals, we have arbitration
conferences. Again, industry conferences are hardly unique to the international
arbitration community, but their ubiquity and frequency is somewhat marked.
Virtually every major arbitral institution hosts an arbitration conference, and
the number of such conferences has only increased over time. Even the COVID-19
pandemic could not dampen the international arbitration community’s hunger
for conferences: remote conferences proceeded apace even as in-person events
were rendered impossible.
These “periodic mass gatherings,” as Prof. Gaillard called them, provide
real “symbolic value” for both speakers and attendees. The former “reinforce their
symbolic capital in demonstrating their cognitive legitimacy”—i.e., are perceived
by the community to be intelligent contributors to that community—and the
latter “demonstrate[] adherence to the values of the community.” Prof. Gaillard
perceived such rituals to be the “gatekeepers” operating to exclude those
“unprepared to engage in costly actions incommensurate with benefits.”
From this perspective then, the development of remote arbitration
conferences are decidedly “anti-arbitration” because they no longer provide as
effective a gatekeeping role. In this view, when a remote conference can be joined
from anywhere in the world, and does not therefore require a long and expensive
flight, or a lost day of work, or similar such “costly actions incommensurate
with benefits” they no longer provide a meaningful ritual function.
By contrast, from the perspective that the social ritual function provided
by conferences is more akin to a generalized recognition tournament—a
speaking slot being a sort of honor akin to any other award or recognition—
A SOCIOLOGY OF BEING PRO-ARBITRATION 197
such remote conferences may indeed be more “pro-arbitration” than their in-
person predecessors. Precisely because they have lower costs but serve largely
the same legitimizing function of “reinforcing the[] symbolic capital” of the
speakers, virtual arbitration conferences may enhance speaker diversity,
avoid reifying existing hierarchies, and thus distribute legitimacy in more
communally useful ways.
On the other hand, remote conferences can also make it more difficult for
younger practitioners or students to join the international arbitration “club.”
As any user of a Zoom breakout room knows only too well, it is difficult
bordering on impossible to replicate the ability to organically meet and
network with one’s peers, to see and be seen and thereby to “demonstrate[]
adherence to the values of the community” that was a major attraction of the
in-person conference circuit.
In short, the arbitration conference, either in-person or remote, like other
arbitration rituals may be fairly considered to have both “pro-” and “anti-”
arbitration aspects. By bearing these in mind, and structuring these rituals
accordingly, we may be able to enhance the former and minimize the latter.
IV. CONCLUSION
As Prof. Bermann noted, the labels “pro-” and “anti-” arbitration are often
insufficient to accurately describe the effects of a practice or structure on the
field of international arbitration. Practices may be pro-arbitration from one
perspective, but completely the opposite from another. Unsurprisingly, things
become no less complicated when we consider the social rituals of arbitration.
Such rituals can be powerful pro-arbitration forces when practiced with that
goal in mind, yet can as easily be destructive and “anti-arbitration” if done
thoughtlessly. As a group of practitioners who, to take Prof. Bermann’s words
once more, “take an exceptional degree of interest in the health and well-being
of the arbitration enterprise,” the members of the international arbitration
community should take the duality of their social rituals seriously, and consider
ways to ensure that not just the legal principles but the social structures of
international arbitration support the legitimacy of the international arbitration
system.
Chapter 34
CHASING SHADOWS: ENFORCEMENT OF
INTERNATIONAL COMMERCIAL ARBITRAL
AWARDS AGAINST NON-SIGNATORIES AT THE
POST-JUDGMENT STAGE
Delyan M. Dimitrov*
In the last decade, the field of international arbitration has undergone a

significant expansion, with many parties preferring to include an arbitration
clause over a litigation alternative. Part of the allure of international arbitration
has been its promise as an efficient, cost-effective, and country-neutral method
of dispute resolution. The growth of international arbitration has also been
helped by the development of a robust enforcement regime through the New
York Convention and the Washington (ICSID) Convention that ensures
compliance with arbitral awards. No one is more attuned to the vital role that
enforcement regimes play in the growth of international arbitration than our
very own Prof. George Bermann, who has authored numerous seminal works
on the interplay between international arbitration and domestic law, with his
work on Restatement of the Law, the U.S. Law of International Commercial and
Investor-State Arbitration likely to shape and influence U.S. courts and
arbitration practitioners for decades to come. Indeed, a favorite topic of
George (if I am allowed to call him that after a decade and a half of knowing
him and being in awe of his genius) is the issue of arbitrability, with its various
permutations and interpretations (See George Bermann, Arbitrability Trouble,
23 Am. Rev. Int’l Arb. 367 (2012); George Bermann, The “Gateway Problem”
in International Commercial Arbitration, 37 Yale J. of Int’l L. 1 (2012)). Inspired
by his relentless curiosity regarding who has authority to decide if an arbitration
agreement exists and when third-parties can be bound by an arbitration
clause, here, I identify what is a very peculiar federal subject jurisdiction issue
that has come up in recent U.S. jurisprudence: namely, under what circumstances
will U.S. federal courts allow an arbitral award creditor to reach the assets of a
third-party after they have already confirmed the arbitral award into a federal
judgment against a party to the arbitral agreement.
In the United States, most international commercial arbitration awards can
be summarily enforced pursuant to Chapter 2 of the Federal Arbitration Act
(FAA), which implements the provisions of the New York Convention into
* Delyan M. Dimitrov is a Lecturer-in-Law at Columbia Law School where he teaches an
advocacy course for all-first year students competing in the Vis Arbitration, Jessup international
law, and E.U. moot courts.
199
domestic federal law. While the FAA envisions a straightforward and quick
enforcement process, complicated issues of federal subject matter jurisdictions
have arisen in enforcement actions in which a party successfully enforces its
arbitral award and, then, at the post-judgment stage, seeks payment of the
award from parties that neither signed the relevant arbitral agreement nor
participated in the underlying arbitration or enforcement action. This issue is
not just academic but also carries practical consequences because it would
indeed be a pyrrhic victory for a party to win the arbitration, have the award
confirmed into a federal judgment, and then find out that it cannot collect
because the award debtor has managed to dispose of all assets, making itself
essentially judgment proof.
I. FEDERAL COURTS WILL LOOK TO STATE LAW TO DETERMINE THE

SCOPE OF THEIR POST-JUDGMENT ENFORCEMENT POWERS
The post-judgment enforcement powers of federal courts are governed by

Rule 69 of the Federal Rules of Civil Procedures, which provides that the
“procedure on execution [of a money judgment]—and in proceedings
supplementary to an in aid of judgment or execution—must accord with the
procedure of the state where the court is located . . . .” (Fed. R. Civ. P. 69(a)(1)).
Thus, post-judgment enforcement proceedings are generally governed by state
law.
As parties frequently seek to enforce commercial arbitral awards in federal
court—while a party may theoretically seek to enforce an international
arbitral award in New York state court, all enforcement actions arising under
the New York Convention or the Panama Convention can be removed to federal
court where federal law will apply. See 9 U.S.C. § 205. Pursuant to the FAA,
federal courts have original jurisdiction to hear such enforcement actions.
9 U.S.C. § 203. New York is a preferred venue due, among other things, its
world-class and neutral court system and New York City’s status as the
financial capital of the United States through which all U.S. dollar transactions
pass—it is instructive to look at a court’s post-judgment powers under New
York state law. CPLR 5225 provides that a judgment creditor may bring a
proceeding “against a person in possession or custody or money or other personal
property in which the judgment debtor has an interest, or against a person who
is a transferee of money or other personal property from the judgment debtor,
where it is shown that the judgment debtor is entitled to the possession of such
property.” N.Y. C.P.L.R. 5225(b). This provision “may be used to attack fraudulent
transfers” as well as “pierce the corporate veil or assert alter ego liability.” Mitchell
v. Lyons Prof’l Servs., Inc., 727 F. Supp. 2d 120, 123 (E.D.N.Y. 2010). Thus, under
CPLR 5225(b), a court may hold a special proceeding to determine if a party is
an alter ego of the judgment debtor or if veil piercing is required. Ren-Cris
Litho, Inc. v. Vantage Graphics, Inc., No. 96-7802, 107 F.3d 4, at *3 (2nd Cir. Feb. 24,
1997).
ENFORCEMENT OF INTERNATIONAL COMMERCIAL ARBITRAL AWARDS 201
II. THE SUPREME COURT’S PEACOCK DECISION LIMITS A FEDERAL

COURT’S POST-JUDGMENT ENFORCEMENT JURISDICTION
Despite the breadth of the post-judgment remedies afforded by CPLR 5225

and other similar state statutes, the Supreme Court’s seminal decision in Peacock
v. Thomas limits a federal court’s authority to impose liability on a non-party
for the underlying judgment in the case. 516 U.S. 349, 358–59 (1996). In
Peacock, the Court considered the narrow issue of whether a federal court has
ancillary jurisdiction to hear a veil piercing claim through which “a federal
judgment creditor seeks to impose liability for a money judgment on a person
not otherwise liable for the judgment.” Id. at 349–50. The Court found ancillary
jurisdiction to be lacking over such post-judgment veil piercing claims because
once judgment had been entered in the original suit, “the ability to resolve
simultaneously factually intertwined issues vanished”. Id. Under Peacock, for
veil piercing or alter ego claims to be successfully maintained post-judgment,
the judgment creditor needs to establish independent subject matter jurisdiction,
whether based on diversity of citizenship or federal question. The Court
distinguished from its holding cases in which it had “approved the exercise of
ancillary jurisdiction over a broad range of supplementary proceedings involving
third parties to assist in the protection and enforcement of federal judgments-
including attachment, mandamus, garnishment, and the prejudgment avoidance
of fraudulent conveyances” on the basis that it had “never authorized the exercise
of ancillary jurisdiction in a subsequent lawsuit to impose an obligation to pay an
existing federal judgment on a person not already liable for that judgment.” Id.
at 350, 356–57.
Applying Peacock, the Second Circuit has also held that a veil piercing claim
that a judgment creditor brings post-judgment “must have its own source of
federal jurisdiction, so that absent an independent basis for federal jurisdiction
a new defendant may not be hauled into federal court.” Epperson v. Entm’t
Express, Inc., 242 F.3d 100, 104 (2nd Cir. 2001). The Second Circuit recognized
that “the courts have permitted judgment creditors to pursue, under the ancillary
enforcement jurisdiction of the court, the assets of the judgment debtor even
though the assets are found in the hands of a third party,” but found that veil
piercing or alter ego claims are different in that they “raise an independent
controversy with a new party in an effort to shift liability.” Id. at 106.
III. PEACOCK’S IMPLICATIONS FOR VEIL PIERCING AND/OR ALTER EGO

CLAIMS AGAINST NON-SIGNATORIES AT THE POST-JUDGMENT
STAGE
Following Peacock, it is unclear if federal courts are categorically prohibited

from exercising ancillary jurisdiction over alter ego and veil piercing claims, or
whether Peacock only forecloses the exercise of jurisdiction over “entirely new
and original” causes of action for the purpose of shifting liability from the
judgment debtor to another party. Peacock, 516 U.S. at 358.
In at least two cases, federal courts have exercised ancillary jurisdiction over
corporate parents or affiliates of judgment debtors that did not pay arbitral
awards and that exercised full control over the debtors, but these decisions do
not expressly address the question of whether ancillary jurisdiction existed
under Peacock. See Motorola Credit Corp. v. Uzan, 739 F. Supp.2d 636 (S.D.N.Y.
2010) (piercing the corporate veil and holding that the corporation “is an alter
ego of the individual defendants and is liable to plaintiffs to the same extent as
those defendants''); Telenor Mobile Comm’cns AS v. Storm LLC, 587 F. Supp. 2d
594, 618-19 (S.D.N.Y. 2008) (holding defendant and its corporate parents in
contempt of court order confirming arbitral award), aff’d 351 F. App’x 467, 469
(2nd Cir. 2009); see also Ellis v. All Steel Constr. Inc., 389 F.3d 1031, 1033 (10th
Cir. 2004) (observing that “[i]f an alter-ego claim is asserted in conjunction
with the underlying federal cause of action, the latter may provide the basis for
ancillary jurisdiction over the alter-ego claim”).
In a separate line of cases, some federal courts have emphasized that they
could only veil pierce at the post-judgment stage if independent subject matter
jurisdiction exists over such claims. For instance, in U.S.I. Props. Corp. v. M.D.
Constr. Co., the First Circuit categorically held that attempts to establish alter
ego liability against a third party “exceeds the proper scope of federal enforcement
jurisdiction absent some independent ground of federal jurisdiction over the
claim.” 230 F.3d 489, 498 (1st Cir. 2000). Similarly, relying upon Peacock and
Epperson, some New York federal courts have refused to extend their post-
judgment ancillary jurisdiction over veil piercing and alter ego claims as that
would “require[] proof on facts and theories different from those underlying the
judgment,” and it is not “an attempt simply to collect a judgment duly rendered
by a federal court. . . ”. Knox v. Orascom Telecom Holding S.A.E., 477 F. Supp. 2d
642, 648–49 (S.D.N.Y. 2007); Estate of Ungar v. Orascom Telecom Holding S.A.E.,
578 F.Supp.2d 536, 548–49 (same); c.f. Overseas Private Invest. Corp. v. Marine
Shipping Corp., No. 02 Civ. 475 (TPG), 2002 WL 31106349 at *3 (S.D.N.Y. Sept.
19, 2002) (agreeing to hear a veil piercing action prior to entering a judgment
in the confirmation action, which was for all intents and purposes complete,
because the court had independent subject matter jurisdiction over that claim,
and “[n]o purpose would be served by dismissing this case and forcing
[Plaintiff] to go through the formality of bringing a new action.” No. 02 Civ. 475
(TPG), 2002 WL 31106349 at *3 (S.D.N.Y. Sept. 19, 2002).
IV. FEDERAL COURTS DO HAVE ANCILLARY JURISDICTION OVER

TURNOVER AND FRAUDULENT CONVEYANCE CLAIMS
While Peacock and the cases applying it have created some ambiguity as to
the powers of federal courts to enforce arbitral awards against third parties post-
judgment, federal courts still have robust ancillary jurisdiction over turnover
ENFORCEMENT OF INTERNATIONAL COMMERCIAL ARBITRAL AWARDS 203
and fraudulent conveyance actions. For instance, a party with a judgment

enforcing an arbitral award may rely upon the court’s ancillary jurisdiction to
force a turnover of a judgment debtor’s assets held by third parties in a process
which is commonly called a garnishment proceeding. See IFC Interconsult, AG
v. Safeguard Intern. Partners, LLC., 438 F.3d 298, 314 (3rd Cir. 2006) (enforcing
an arbitral award and permitting the court’s exercise of ancillary jurisdiction
over garnishment actions on the basis that that “although garnishment actions
are new actions in the sense that there is a new party and a new theory for that
party’s liability, they are not new actions in the sense of a new direct claim.”).
Notably, pursuant to the U.S. courts’ ancillary jurisdiction, judgment debtors
may be forced to turn over out-of-state assets even where personal jurisdiction
was obtained only on the basis of an agreement to arbitrate in New York. See
Yukos Capital S.A.R.L. v. OAO Samaraneftegaz, 10 CIV. 6147 PAC, 2014 WL
81563, at *2 (S.D.N.Y. Jan. 9, 2014) (holding that where Samaraneftegaz agreed
to arbitrate in New York and where it possesses no U.S. assets, “Yukos Capital
is entitled to a turnover order for Samaraneftegaz’s out of state assets in order
to satisfy the judgment”), vacated on other grounds and remanded sub nom.
Yukos Capital S.A.R.L. v. Samaraneftegaz, 592 Fed. Appx. 28 (2d Cir. 2015)
(unpublished), as amended (Mar. 2, 2015).
The federal courts’ ancillary jurisdiction also extends to post-judgment
attempts to unwind fraudulent conveyance transfers that had the effect of making
the loser in an arbitration, judgment proof. See Epperson, 242 F.3d at 105 (holding
“claims for fraudulent conveyance were within the scope of the enforcement
jurisdiction of the district court”). Thus, a federal court has ancillary jurisdiction
to unwind a transaction through which the losers in an arbitration sought to
avoid paying the arbitral award or the subsequent judgment. See Yukos Capital,
at *2 (issuing a turnover order against the judgment debtor on the basis it
“transferred millions to its shareholder and affiliated entities” and these
payments had the effect of “frustrating Yukos Capital’s ability to collect on the
judgment” by “depleting the judgment debtor’s available assets”).
V. FOR POTENTIAL ARBITRAL AWARD CREDITORS
Given the uncertainty as to whether, absent a showing of independent

subject matter jurisdiction, the winner in an international arbitration can bring
a veil piercing or alter ego claim following the recognition of an arbitral award
in federal court, potential judgment creditors will be well served to evaluate
before commencing the arbitration or the enforcement action if there are
grounds upon which non-signatories may be bound by the relevant agreement
to arbitration. In the enforcement context, the Second Circuit has said: “we
have repeatedly found that non-signatories to an arbitration agreement may
nevertheless be bound according to ‘ordinary principles of contract and agency’”.
Smith/Enron Cogeneration Ltd. P’ship., Inc. v. Smith Cogeneration Intern., Inc.,
198 F.3d 88, 97 (2nd Cir. 1999). Moreover, in post-judgment enforcement scenarios,
judgment creditors are more likely to satisfy the federal court’s ancillary
jurisdiction standards if they seek turnover or assert fraudulent conveyance
claims that are consistent with traditional notions of a collection or enforcement
action and do not seek to impose liability on a new party.
Chapter 35
OPERATIONALIZING THE FAA’S
“PRO-ARBITRATION” POLICY:
TOWARDS A NORMATIVE BASIS FOR
THE DUTY TO ARBITRATE IN GOOD FAITH
E Jin Lee*
I. INTRODUCTION
International arbitration is now ubiquitous, and its users have become

sophisticated. After electing to resolve their disputes by arbitration, parties
and their counsel must grapple with the legal framework that supplies the
obligation to arbitrate, as well as the terms on which they must do so. But as
with any framework that seeks to establish and regulate a procedure, there is
scope for participants in that procedure to tactically maneuver. Commentators
have thus observed the rise of recalcitrant procedural tactics—or “guerrilla
tactics”—in international arbitration. And they have lamented that there are
limited tools available to arbitrators to address such gamesmanship.
The duty to arbitrate in good faith is said to be a salve for “guerrilla tactics.”
But there is a need to find a more robust basis in U.S. law for the duty. This
essay suggests that, where an international arbitration agreement is governed
by U.S. law, the Federal Arbitration Act’s (FAA) “pro-arbitration” policy can be
deployed to address these concerns, because it supplies a normative basis for
the obligation to arbitrate in good faith.
II. “GUERRILLA TACTICS” IN INTERNATIONAL ARBITRATION
“Guerrilla tactics” in international arbitration need no introduction. They

will be familiar to participants in modern international arbitration. What counts
as a “guerrilla tactic” continues to be the subject of debate. But it seems clear
that the concept embraces tactics aimed at creating procedural disruption,
frequently with the object of derailing or compromising an arbitration. These
tactics are often not expressly prohibited by the parties’ arbitration agreement,
chosen institutional rules, the lex arbitri or ethical rules governing counsel.
* E Jin Lee, J.D., Columbia Law School; LL.B. (Hons), King’s College London, is an Associate
in the New York office of Gibson, Dunn & Crutcher. This note is submitted in honor of
Professor George A. Bermann, as part of a collection of essays authored by Columbia Law
School students, alumni and faculty. The views presented in this essay are the author’s only.
The author is grateful to Nika Madyoon for her insightful comments on an initial draft. Any
mistakes are the author’s.
205
Parties or counsel inclined to such tactics are thus emboldened to try their
luck, standing ready with the retort that they are still coloring within the lines.
For example, a party realizing that its merits position is doomed to failure
may create procedural incidents to manufacture grounds for the annulment of
any award ultimately rendered against it. A party wishing to pressure the other
side’s witness may commence harassing litigation against that witness in her
home jurisdiction. A party may submit spurious interlocutory applications
designed to introduce delay. A party may initiate frivolous challenges of
arbitrators. The list goes on.
The late Johnny Veeder aptly described these tactics as “ambiguous acts
short of deliberate dishonesty which cross the line of procedural fairness because
no-one really knows quite where that line is now drawn at the international
level.” V. V. Veeder, The 2001 Goff Lecture – The Lawyer’s Duty to Arbitrate in
Good Faith, 18(4) ARBITRATION INTERNATIONAL 431, 435 (2002).
III. GOOD FAITH AND THE SEARCH FOR NORMATIVE BASIS
The duty to arbitrate in good faith is one response to “guerrilla tactics.” So

construed, the duty requires parties to an arbitration to refrain from engaging
in recalcitrant procedural maneuvers. Arbitrators have acknowledged that the
duty can be enforced to combat “guerrilla tactics.” Thus, the tribunal in Libananco
v. Turkey opined as follows:
Nor does the Tribunal doubt for a moment that, like any other
international tribunal, it must be regarded as endowed with the inherent
powers required to preserve the integrity of its own process—even if
the remedies open to it are necessarily different from those that might
be available to a domestic court of law in an ICSID Member State. The
Tribunal would express the principle as being that parties have an
obligation to arbitrate fairly and in good faith and that an arbitral
tribunal has the inherent jurisdiction to ensure that this obligation is
complied with; this principle applies in all arbitration, including
investment arbitration, and to all parties, including States (even in the
exercise of their sovereign powers). Libananco v. Turkey, Decision on
Preliminary Issues, ¶ 78.
Some lex arbitri expressly provide the normative basis for the duty to
arbitrate in good faith. Article 1464 of the French Code of Civil Procedure
states that “[b]oth parties and arbitrators shall act diligently and in good faith
in the conduct of the proceedings.” Similarly, section 40 of the English
Arbitration Act 1996 provides that:
(1) The parties shall do all things necessary for the proper and
expeditious conduct of the arbitral proceedings. (2) This includes
(a) complying without delay with any determination of the tribunal as
OPERATIONALIZING THE FAA’S “PRO-ARBITRATION” POLICY 207
to procedural or evidential matters, or with any order or directions of

the tribunal, and (b) where appropriate, taking without delay any
necessary steps to obtain a decision of the court on a preliminary
question of jurisdiction or law.
The U.S. law basis for the duty is tenuous, however. Some U.S. courts have
acknowledged the duty when it is provided for in the parties’ arbitration
agreement—i.e., when the parties contract to arbitrate in good faith with each
other. But such language is not typically included in international arbitration
agreements. Such a contract term would also—in any event—be subject to the
vagaries of contract interpretation so that it is untethered to a general
standard. In ADT v. Schanz, the U.S. District Court for the Southern District of
Florida put the point as follows:
The Plaintiff's duty to arbitrate in good faith did not arise under any of
the Federal Rules or the Local Rules of this District. As a result, the
cases that Plaintiff cites, discussing the good faith standard under the
Federal Rules, are largely inapposite . . . . The operative question is not
what “good faith” means under the Federal Rules, but rather what the
parties intended “good faith” to mean when they entered into their
settlement agreement. ADT LLC v. Schanz, No. 18-CV-81277, 2019 WL
2552048, at *1 (S.D. Fla. June 20, 2019) (emphasis added).
Some courts have found support for the duty in the implied covenant of
good faith and fair dealing. But this is not without its issues. U.S. courts have
consistently emphasized that the covenant of good faith and fair dealing sets a
high threshold. Thus, “the covenant will be breached only in a narrow range of
cases.” Sec. Plans, Inc. v. CUNA Mut. Ins. Soc., 769 F.3d 807, 817 (2d Cir. 2014).
Locating the duty to arbitrate in good faith in the doctrine may set the bar too
high. This is especially since the covenant takes juridical effect as an implied
(rather than express) contract term, which courts and arbitrators are typically
cautious to enforce.
Other courts have simply relied on “good faith” to supply an interpretation
of the parties’ arbitration agreement, without specifying its normative basis.
Thus, in ReliaStar v. EMC, the U.S. Court of Appeals for the Second Circuit
“construed” the parties’ arbitration agreement “to limit the arbitrators’ authority
to award attorney’s and arbitrator’s fees only where the parties participate in
the arbitration in good faith.” ReliaStar Life Ins. Co. of N.Y. v. EMC Nat. Life Co.,
564 F.3d 81, 89 (2d Cir. 2009).
There is, then, a need to find a more robust normative basis in U.S. law for
the duty to arbitrate in good faith. If the duty is to be invoked credibly by
arbitrators or courts to combat arbitral “guerrilla tactics,” its juridical source
should be clearly delineated so that its implications are understood.
IV. OPERATIONALIZING THE FAA’S “PRO-ARBITRATION” POLICY
A normative basis for the duty to arbitrate in good faith can be found in the
FAA’s “pro-arbitration” policy. The U.S. Supreme Court has consistently
acknowledged that the FAA embodies a “federal policy favoring arbitration”—
i.e., a “pro-arbitration” policy. See, e.g., Volt Info. Scis., Inc. v. Bd. of Trustees of
Leland Stanford Junior Univ., 489 U.S. 468, 476 (1989). U.S. courts usually invoke
the FAA’s “pro-arbitration” policy to serve a presumption in favor of compelling
arbitration when an arbitration agreement is challenged. But the FAA’s “pro-
arbitration” policy is—at its essence—a generally applicable interpretive standard.
Whatever being “pro-arbitration” may require in the abstract, it is clear
that the concept is concerned with furthering the ends of arbitration as a mode
of dispute resolution. Professor Bermann puts the point as follows:
Viewed in abstract terms, a policy or practice is arbitration-friendly to

the extent that it favours the achievement of international arbitration’s
purposes, whatever we take them to be. If a particular policy or
practice sufficiently advances those purposes, it may be regarded as
pro-arbitration and, as such, merit the support of arbitration partisans.
George A. Bermann, What Does it Mean to Be “Pro-Arbitration”?,
34(3) ARBITRATION INTERNATIONAL 341, 342 (2018).
It follows that construing international arbitration agreements to embody

a duty to arbitrate in good faith is a natural extension of the “pro-arbitration”
policy’s interpretive logic. Indeed, Gary Born observes that the “most
fundamental objective and effect of an international arbitration agreement is
to obligate the parties to participate cooperatively, diligently and in good faith
in the resolution of their disputes by arbitration pursuant to that agreement.”
See GARY B. BORN, INTERNATIONAL COMMERCIAL ARBITRATION 1350 (3d ed. 2020).
Thus, the failure of a party to arbitrate in good faith is a breach of the
parties’ arbitration agreement, properly construed. Stated differently, on a
purposive interpretation, a recalcitrant party resorting to “guerrilla tactics”
breaches its arbitration agreement because it is not properly performing its
agreement to arbitrate.
This interpretive claim finds an analogy in investment treaty arbitration.
Article 26 of the Vienna Convention on the Law of Treaties requires treaties to
“be performed . . . in good faith” by their contracting parties. Thus, the Quiborax
v. Bolivia tribunal applied Article 26 to the dispute resolution provisions of the
applicable investment treaty to find—on the basis of this interpretive
principle—that parties to investment treaty arbitration are under a general
duty to arbitrate in good faith:
The Claimants’ allegations refer to different facets of the duty to arbitrate

in good faith. The existence of such a duty is undeniable. It arises out of
OPERATIONALIZING THE FAA’S “PRO-ARBITRATION” POLICY 209
Article 26 of the [Vienna Convention] in connection with Article X of

the BIT. Quiborax v. Bolivia, Award, ¶ 589.
Similarly, the Lao Holdings v. Laos tribunal located the duty in Article 31(1)
of the Vienna Convention, which provides that “[a] treaty shall be interpreted
in good faith in accordance with the ordinary meaning to be given to the terms
of the treaty in their context and in the light of its object and purpose.” See Lao
Holdings v. Laos, Award, ¶ 234.
Arbitral tribunals constituted under an international arbitration agreement
governed by U.S. law should therefore feel comfortable enforcing a duty to
arbitrate in good faith, simply by enforcing the parties’ agreement to arbitrate.
This should not be surprising. Arbitrators routinely enforce arbitration
agreements, for example, by exercising their Kompetenz-Kompetenz.
V. CONCLUSION
The advent of “guerrilla tactics” in international arbitration has necessitated

a search for mechanisms to combat such maneuvering. The duty to arbitrate in
good faith provides a flexible standard to address the myriad ways that a
recalcitrant party might seek to disrupt an arbitration. But in order to be
credibly deployed, that duty should find its source in existing doctrine. I have
suggested here that the U.S. “pro-arbitration” policy can supply this doctrinal
hook. While it is not always possible to say what being “pro-arbitration” requires
across a range of contexts, it is self-evident that tactics aimed at disrupting the
endeavor of arbitration are anathema to the concept. It should be uncontroversial
to operationalize the “pro-arbitration” policy against “guerrilla tactics.”
Chapter 36
IS APPELLATE REVIEW PRO- OR
ANTI-ARBITRATION?
Eduardo Grebler*
I. THE STATE OF PLAY
The resolution of commercial disputes by arbitration is generally seen as

more efficient than court proceedings. To a large extent, such perception is due
to arbitral awards being enforceable shortly after being issued by the arbitral
tribunal, because they are normally not subject to appeal and their annulment
by the courts is only admissible in exceptional circumstances. Those in favor
of one-instance arbitration argue that reviewing an arbitral award by someone
other than the arbitral tribunal would undermine the main benefit of arbitration
(i.e., the speed at which a final decision can be reached).
Moreover, unlike state judges, who are designated according to impersonal
criteria, arbitrators are appointed by the parties amongst people they trust.
Save in special circumstances, each party appoints one member of the arbitral
tribunal, and the third arbitrator is selected by the co-arbitrators so appointed.
Hence, because the arbitral tribunal is formed according to the will of the
parties, its decisions should presumably be final and binding on them.
On the other hand, the right to appeal a decision taken by an adjudicator—
the so-called double degree of jurisdiction—is a most valued principle in
civilized countries. The losing party's right to have its arguments reviewed by
a higher body of adjudicators has, for a long time, been a warrant against
possible errors of fact or law by the arbitral tribunal. Thus, appellate review is
a means to reach the best possible decision for the case and a way of giving the
losing party the certainty that the decision has been duly analyzed, and either
upheld or reversed by a reviewing body.
Between those two opposing values—the speed of the process, on the one
hand, and the right to a review of the adverse decision, on the other—so far
the balance has tipped in favor of the definitiveness of the arbitral tribunal’s
award, to the detriment of the right to appeal.
In line with such a situation, the rules of many national and international
arbitral institutions provide that parties implicitly waive the right to appeal
the arbitral award issued under such rules. In the same sense, arbitration laws
of several countries treat the arbitral award as in principle unappealable,
* Eduardo Grebler is a Lawyer, Arbitrator, Professor at the Law School of the Catholic
University of Minas Gerais (Brazil), Member of the Permanent Court of Arbitration (The Hague),
Fellow of the Chartered Institute of Arbitration (UK), and LLM (Columbia Law School, 1996).
211
admitting the possibility of appeal only by exception, if expressly provided for

by the parties.
A large part of the arbitration community leans in favor of a single instance
in arbitration, particularly when the case has an international element, as was
found in the survey conducted by Queen Mary University in conjunction with
White & Case in 2015. In that survey, 77% of respondents spoke against the
inclusion of an appeal mechanism in international arbitration. Although in-
house lawyers seem to have a distinct opinion—to them, the lack of appeal was
the third-worst characteristic of international arbitration—there is a preference
for the definitiveness of the arbitration award, even if detrimental to the
correctness of the decision.
In my reflections on George Bermann’s query about what does it mean to
be pro-arbitration, I consider that the preference for a single-instance arbitration
is less pro-arbitration than it may seem, in that the lack of appellate review of
an unsatisfactory arbitral award may discourage parties to adopt arbitration
for the solution of their commercial disputes. Therefore, I submit that giving a
party the right to appeal an arbitral award that it deems wrong is a pro-
arbitration stance, provided that the arbitration agreement so allows.
II. PROCEDURAL SPEED
Speed is undoubtedly one of the objectives pursued by the parties when

choosing a method for the solution of their commercial disputes. It is well
known that obtaining jurisdiction from the State judicial system requires time,
as court proceedings are a public activity where rites prevail over efficiency.
The bureaucracy of the judicial process affects the legal system of all
countries, regardless of their legal culture or degree of development. Of course,
the efficiency of the judicial function may vary from country to country according
to their practices and the resources allocated to it; however, even where the
judicial function has reached high standards of modernization and efficiency,
dispute resolution in a court of law tends to be excessively long and full of
complexities.
Although the speed of arbitration proceedings is one of their main goals, only
rarely they are concluded within a short time, as due process considerations
require that the parties be given equal opportunity to appoint arbitrators,
present their arguments and respond to the other’s, present evidentiary
documents, hear witnesses of fact and expert witnesses, participate in one or
more hearings, an award being given by the arbitral tribunal only after those
steps have been properly taken.
Practice shows that arbitral proceedings often take more than twelve
months. In cases of greater technical complexity, or that involve institutions,
arbitrators, parties, or witnesses from other countries, the sentence will probably
be handed down in about twenty-four months. and at times procedures may last
three or more years. In that context, one can say that the speed of the arbitral
IS APPELLATE REVIEW PRO- OR ANTI-ARBITRATION? 213
proceeding is no longer the rule and cannot be taken for granted nowadays.
That does not mean that it should not be a goal, or that the arbitration process
generally takes more time than litigation in a court of law. What I mean to say
is that the parties will likely be frustrated if they expect arbitral proceedings
to be a swift method for resolving disputes, notably when the losing party
attempts to render the award null or resists to comply with it.
III. THE QUALITY OF DECISIONS
Another factor that encourages the use of arbitration is the possibility of

having the dispute resolved by persons well acquainted with the subject matter
of the controversy, directly or indirectly chosen by the parties. That is also an
important incentive for the adoption of arbitration, instead of the traditional
dispute resolution by a state judge.
Composing the arbitral tribunal with specialists chosen by the parties
suggests that the award should meet the standard of quality they expect.
Besides being knowledgeable on the legal and contractual aspects involved in
the deal, arbitrators should be available for a deeper analysis of documents,
expert reports, and testimonies, so that the parties’ arguments are considered
with all due attention. The arbitrators’ engagement assumes that they will
adjudicate the dispute with competence and efficiency.
However, the idea of efficiency is not always found in arbitration. Although
experienced and reputable arbitrators are genuinely dedicated and interested
in properly fulfilling their mission, sometimes difficulties arise in the dynamics
of the arbitral tribunal due to personal traits of its members, lack of cooperation
or lack of time of one or more arbitrators, leading to a deficient decision-
making process and to results that may not be convincing or acceptable. It is
noteworthy that most respondents to the survey conducted by Queen Mary
University and White & Case, including those who also serve as arbitrators,
thought that the conduct of arbitrators should be more regulated.
The mere notion that there is a potential review body to scrutinize the award
has a positive influence on the depth and zeal with which arbitrators analyze
the facts and draft the award. The prospect that another set of arbitrators may
review the award and correct, amend or reverse the decision taken, is inducive
of a greater care with the quality of decision-making by the arbitrators.
IV. APPELLATE REVIEW IN ARBITRATION TODAY
As is well known, the norms on arbitration come from different sources:

written legislation at the seat of the arbitration, the arbitration rules applicable
to the procedure, and the arbitration agreement itself.
At the international level, the UNCITRAL Model Law, a source of inspiration
for many national arbitration laws, drafted in 1985 and updated in 2006, adopts
language that is frankly contrary to the possibility of appealing against arbitral
awards. Article 34 of the Model Law defines the request for annulment as the
exclusive remedy against the arbitral award and reiterates that “judicial recourse
against an arbitral award can only be made upon a request for annulment”.
However, certain national laws on arbitration refer to the possibility of an
appeal on the merits. Austria and South Africa recognize the finality of the
award unless the parties have agreed as to an appeal. In England, the 1996
Arbitration Act allows the parties to appeal the award in matters of law unless
they have expressly agreed to exclude this option or have adopted institutional
rules that do so. Even where the law provides that the award is not subject to
appeal, like the Brazilian Arbitration Law, the pervasiveness of the principle of
party autonomy in arbitration allows the parties to adopt rules that they deem
appropriate, parties may stipulate that the award may be reviewed, unless
there is an express impediment in the arbitration rules chosen by the parties.
At the level of arbitration rules, the right to appeal within the scope of
arbitration has been present for some time in the Grain and Feed Trade
Association (GAFTA) and the International Cotton Association. In recent years,
several other arbitral institutions, such as the American Arbitration Association
(AAA), the Conflict Prevention & Resolution (CPR), and the Judicial Arbitration
and Mediation Services, Inc. (JAMS), revised their arbitration rules to allow the
appellate review of arbitral awards, if so agreed by the parties in the contract
or a subsequent agreement. Arbitration centers in Europe and Asia also amended
their regulations to allow review of the merits of the arbitration award, as the
European Court of Arbitration (ECA), the Cour d’Arbitrage International de
Paris (CAIP), and the Corte Española de Arbitraje.
Conversely, the rules of a few recognized arbitral institutions still exclude
the right to appeal an award, by requiring the parties to waive any form of
appeal. This is the case of the UNCITRAL Arbitration Rules published in 1976 and
revised in 2010, which allow the interpretation, correction, or supplementation
of the arbitral award only by the same arbitral tribunal that issued it, yet within
narrow limits. The International Chamber of Commerce (ICC), the London Court
of International Arbitration (LCIA), the Stockholm Chamber of Commerce (SCC),
the Vienna International Arbitral Centre (VIAC), the Hong Kong International
Arbitration Centre (HKIAC), and the Singapore International Arbitration
Centre (SIAC) are equally restrictive. It remains to be seen whether at some
point those institutions will adopt an optional appellate review mechanism, in
response to what appears to be a market trend.
V. STRUCTURE OF APPELLATE REVIEW IN ARBITRATION
As with any activity in the legal world, an arbitral award is subject to being
declared null and void. Because the losing party in an arbitral proceeding has
a natural interest to overturn a sentence that it deems incorrect, it may seek
its annulment in a court of law, if it can show a condition required by the
applicable law for such purpose is present in the case. Nonetheless, in many
IS APPELLATE REVIEW PRO- OR ANTI-ARBITRATION? 215
national laws those conditions are rather strict, to avoid arbitral awards being
set aside for trivial reasons; thus, meeting the requirement for the annulment
of an award is not an easy task, in which case the losing party can do nothing.
The remedy for such a frustrating outcome is to allow an appeal on the
merits of the award. The review of the merits of the arbitral award should be
made within the framework of the arbitral process, rather than in a court of
law, as the parties who adopt arbitration presumably intend to resolve their
disputes out of the State court system.
Because arbitration is a consensual method of resolving disputes, parties
may agree to adopt a double degree of jurisdiction, granting to the arbitral
tribunal competence to issue the award, and to an appellate body to review the
decision made by the arbitral tribunal if so requested by the losing party. Some
rules already provide that, at the outset of the arbitration, the parties can
decide that the arbitral award may be appealed, and others establish that the
appeal will be available unless the parties expressly waive such right.
A review on the merits of an arbitral award implies reassessing the
evidence or interpreting the contract or the applicable law differently from the
arbitral tribunal. In some rules, the review is only allowed for matters of law,
while in others there is a broader competence to review, including, in some
cases, the possibility of repeating the evidentiary stage with a new hearing and
new depositions.
VI. COSTS ARISING FROM THE APPELLATE REVIEW
Additional costs for reviewing the award should be borne by the party
seeking review of the award. Such costs should cover essentially the fees of the
appellate body and the incidental expenses of the arbitration institution in
prolonging the procedure. The final responsibility for the costs of the review
phase should be tied to the outcome of the appeal.
VII. PROSPECTS FOR APPELLATE REVIEW IN THE FUTURE
I submit that the right to appeal the arbitral award is likely to become the
common practice of arbitration users, as a greater value is given to a double
degree of jurisdiction than to the speed of the arbitral proceedings. The additional
time and cost of an appeal against an unsatisfactory arbitration award are
compensated by the certainty that stems from a double degree of jurisdiction.
As stated by Richard Posner, “the risk that the law may not be correctly applied
is sufficient for lawyers not to recommend to its clients arbitration as a dispute
resolution method; thus, the possibility of appeal in arbitration would help to
overcome these obstacles.”
As a side effect, appellate review in arbitration can be a shield against the
anti-arbitration attitude that appeared in different parts of the world, based on
the argument of unaccountability of the arbitrators for their decisions.
In my view, allowing the review of an arbitral award through appellate

review within the arbitration system is a pro-arbitration stance that deserves
the support of the arbitration community.
Chapter 37
WILL WE MAKE ARBITRATION A VICTIM OF ITS
OWN SUCCESS?
Ellen‐Louise Moens*
We, arbitration practitioners, tend to view every judicial decision in

defense of arbitration agreements as a positive for us. Every such decision can
seem like another brick in what is now a robust wall protecting the institution
of arbitration and ensuring its continuation as a viable means of resolving
disputes. But what disputes exactly? In our field, we often use the word
“arbitration” to mean “commercial arbitration” or even “international commercial
arbitration.” Perhaps this seemingly innocent parochialism is blinding us to a
growing backlash that—while not truly directed at commercial arbitration—
threatens to hamper commercial arbitration as collateral damage.
Over the past few decades, the increasing trend of corporations inserting
arbitration clauses into their contracts with consumers is coming under
increased public scrutiny and has had devastating effects on consumer rights.
One need only do a simple search on the New York Times editorial opinion
section to find countless arguments alluding to arbitration as an “epidemic”
and arbitration clauses as something that consumers are “forced” into. Indeed,
the arbitration system is coming under attack like never before and the
legislative hostility towards the overuse of consumer arbitration is alarming.
This short essay suggests that the trends in consumer arbitration have
created a target for legislative (and possibly judicial) action. Whether that action,
if taken, affects commercial arbitration may depend on policymakers being
able to distinguish between “true” commercial arbitration and other forms of
arbitration. We, as “arbitration” practitioners, may need to take an active role
in this project, and we may ourselves need to start marking the distinction
between commercial arbitration and non-commercial arbitration lest we be
setting a trap for ourselves with every new “pro-arbitration” decision that comes
down from the courts.
I. PRO‐ARBITRATION CONSIDERATIONS
To consider whether a policy or practice is “pro-arbitration” one must

consider “to what extent it effectuates the likely intentions or expectations of
* Ellen-Louise Moens is Counsel at Walsh Guevara LLP and an Adjunct Professor of Law at
Fordham Law School. Her main area of practice is international arbitration, including
commercial and investment treaty arbitration. She is a member of the bars of New York, England
& Wales, and Paris and has experience under both common and civil law systems.
217
the parties” and “to what extent…it promote[s] accuracy in the administration
of justice” (Professor Bermann, “What Does it Mean to be ‘Pro Arbitration’?”).
If a policy or practice is “pro-arbitration” from an overall point of view, it may
nevertheless disserve important values that are themselves extrinsic to
arbitration. The inherent conflict that exists in “pro-arbitration considerations”
can therefore point in opposite directions, creating a never-ending debate as
to what is and what is not pro-arbitration.
Given that there are many ways to measure the impact of a given policy or
practice, even more ways to argue its “pro-arbitration” nature, and even more
ways to look at the trade-offs, this prompts the question of which “important
values” are themselves intrinsic to arbitration.
Intrinsically, an arbitration agreement is a valid contract, knowingly and
intentionally entered into by the parties. Furthermore, arbitration should not
deny any substantive rights.
In the consumer context, mandatory arbitration clauses are anything other
than voluntary and they often operate to deny a consumer’s substantive rights
by making it impractical or uneconomical for a consumer to bring a case.
Therefore, the pro-arbitration justification for forced arbitration in the consumer
context cannot stand.
II. HISTORICAL DEVELOPMENT OF ARBITRATION CLAUSES AND THE

PREVALENCE OF ARBITRATION CLAUSES IN CONSUMER
CONTRACTS
The Federal Arbitration Act (the FAA), passed in 1925, was enacted to
establish the validity and enforcement of arbitration agreements in maritime
transactions or contracts evidencing a transaction involving commerce
(Preston Wigner, Richmond Law Review, “The United States Supreme Court’s
Expansive Approach to the Federal Arbitration Act”).
Therefore, between 1925 and the 1980s, courts interpreted the FAA as
applying narrowly to commercial cases involving federal law that were brought
in federal courts on independent federal grounds. However, in the 1980s, the
reach of the FAA markedly expanded.
The Supreme Court’s presumption in favor of arbitration when deciding
cases involving the FAA was established in Moses H. Cone Memorial Hospital v.
Mercury Construction Corp., 460 U.S. 1 (1983), which “furthered the liberal
federal policy favoring arbitration agreements, notwithstanding any state
substantive or procedural policies to the contrary.” This declaration of federal
policy has provided a rationale for the expansion of the FAA that followed.
The holding in Southland Corp. v. Keating, 465 U.S. 1 (1984) established
that the FAA also applied to disputes over contracts that were brought in state
courts, so long as the dispute involved interstate commerce. Here, the Supreme
Court cemented the FAA’s preemption of any state laws that did not accord
with it or with the “liberal federal policy favoring arbitration” (460 U.S. 1 (1983)).
WILL WE MAKE ARBITRATION A VICTIM OF ITS OWN SUCCESS? 219
In 1985, in Mitsubish Motors v. Soler Chrysler‐Plymouth, 473 U.S. 614 (1985),

a business dispute in which one party alleged a violation of antitrust laws, the
Supreme Court held that under the FAA, parties could even compel arbitration
of certain statutory disputes.
Furthermore, the development of the separability doctrine, initially coined
in Prima Paint Corp v. Flood & Conklin Mfg. Co., 338 U.S., 395 (1966), and extended
by Buckeye Check Cashing, Inc., v. Cardegna, 546 U.S. 440 (2006), stipulates that
even if the entire contract was invalid, the arbitration clause survives it.
These various expansions of the FAA’s reach were justified on “pro-
arbitration” grounds, i.e., the presumption of the validity of arbitration
agreements, the preemption of the FAA, and the separability doctrine. However,
there was little regard for the consequences arising from the differences
between arbitration in the commercial and consumer context.
Due to these pro-arbitration decisions and the expansion of the FAA, major
corporations and lawyers saw an opportunity to include arbitration agreements
in contracts with consumers. Most consumers entering into these mandatory
arbitration agreements were unaware of the fact that they contained arbitration
provisions. Much less did they understand the ramifications of being bound to
these provisions.
This phenomenon of closely circumscribing consumers’ dispute rights was
intensified when arbitration clauses were combined with class-action waivers.
This type of waiver has generally been permitted by courts.
In AT&T Mobility LLC v. Concepcion, 563 U.S. 333 (2011) the Supreme Court
upheld a class-action waiver in a consumer contract against a challenge that
the waiver was unconscionable under California state law. In that case, an
AT&T customer brought a class action alleging that the company had engaged
in fraudulent practices by charging sales taxes to customers who were promised
free cell phones in exchange for a two-year service contract. AT&T’s agreement
included an arbitration clause that also banned class actions and class-wide
arbitration. The plaintiffs wanted to bring their case as a class action, so they
argued that the class-action waiver was unconscionable. On appeal, the Ninth
Circuit denied AT&T’s motion to compel arbitration on an individual basis,
finding it unenforceable under California’s three-pronged test to determine
whether a class-action waiver in a consumer contract is unenforceable.
The Supreme Court reversed, holding that the California rule was preempted
because it interfered with arbitration. Justice Scalia, writing for the majority,
argued that “class arbitration sacrifices the principal advantage of arbitration—
its informality—and makes the process slower, more costly, and more likely to
general procedural morass than final judgment.” Justice Stephen Breyer, however,
discussed the damage to consumers in his dissent “what rational lawyer would
have signed on to represent the Concepcions in litigation for the possibility of fees
stemming from a $30.22 claim.” He further noted that many people would not
press their own case for that amount if it meant “filling out forms that require
technical knowledge or waiting at great length while a call is placed on hold.”
A study and report issued by the Consumer Financial Protection Bureau

(CFPB) in 2015 documents that mandatory arbitration in consumer financial
contracts is widespread and that mandatory arbitration clauses are included
in a majority of contracts in many areas of consumer finance. This study found
that credit card issuers representing 53% of the total credit card market
include mandatory arbitration clauses. For prepaid cards, which tend to be
used more by lower-income individuals, 92% of agreements include mandatory
arbitration clauses. In student loans, 86% of the largest private lenders use
mandatory arbitration clauses. Furthermore, the CFPB found that over 90% of
the mandatory arbitration procedures expressly prohibited class actions.
This goes back to the point that the FAA was enacted to resolve disputes
between businesses—not businesses and consumers. The major distinguishing
factor between businesses entering into contracts containing arbitration clauses
and consumers is that they have consented to them and that they have helped
craft them, whereas, in the consumer context, consumers generally do not
understand or even know about the arbitration clauses in their contracts.
III. WHAT IS THE WAY FORWARD?
There have been multiple attempts to amend the FAA, starting with the
Arbitration Fairness Act in 2017, and the recent Forced Arbitration Injustice
Repeal Act (H.R. 963) FAIR Act, passed by the U.S. House on March 17, 2022. FAIR
bans forced arbitration in employment, consumer, antitrust, and civil rights
disputes.
Speaking about the bill in November 2021, Congressman Hank Johnson
(GA-04) stated “Arbitration clauses have permeated American life in recent
decades. They’ve seeped into our cell phone contracts, our medical paperwork
and our employee handbooks with opaque language, written by well-paid
corporate attorneys. The clauses are hidden in updated terms and conditions,
incorporated into mid-year employee reviews, and implicit in purchase contracts.
And they all prevent us from having our day in court. It is time for this to
change. I’m in Congress to stand up for the voiceless and the powerless, and this
bill, the Forced Arbitration Injustice Repeal Act, or the FAIR Act, is a testament
to that.”
To date, however, these proposed amendments of the FAA remain
unsuccessful and it remains to be seen whether the FAA amendments will be
adopted.
What it shows, however, is that outsiders to the arbitration world are eager
to make changes. A new policy may be required, but it should not be forged
without taking into account the value of arbitration to commercial parties and,
in that context, it should not wipe away the accomplishments made over the
preceding decades in favor of arbitrability and enforcement.
We, as arbitration practitioners, should also get involved in addressing the
situation.
WILL WE MAKE ARBITRATION A VICTIM OF ITS OWN SUCCESS? 221
First, in order to defend the broad enforceability of commercial arbitration

contracts, we practitioners need to start seeing the importance of the commercial/
non-commercial distinction and making a point to correct this in our practice
on a daily basis. Second, if we draw that distinction well, we should perhaps
get involved in the legislative projects that are going to address this on a pro-
consumer basis and advocate to ensure that such legislation does not go too
far in creating exceptions to the FAA and related jurisprudence.
Let us do more to protect the institution we believe in so vehemently and
make sure we are not on the losing end of this battle.

Chapter 38
DOES IT STILL MAKE SENSE TO SPEAK OF BEING
“PRO” ARBITRATION?
Enikő Horváth*
At its core, arbitration is nothing more than a form of consent-based

dispute resolution: one in which chosen decision-makers issue binding decisions
on the parties’ claims in accordance with an agreed adjudicatory procedure.
Practitioners sometimes see it through a different lens, however. It is an
embodiment of personal or party autonomy. In its international guise, it is
variously a tool to promote international commerce and business, a conduit to
strengthen the rule of law or a means to prevent or resolve international conflicts.
The exaltation of “Arbitration”—capital “A,” qua a lofty archetype—is to
some extent a function of its pedigree: the roots of inter-State arbitration and
commercial arbitration alike reach back to antiquity, after all. It is, perhaps,
also a function of the fact that countless battles are fought to ensure recognition
of the right to arbitrate or to define its scope in specific disputes. The legal
mechanisms to which recourse is often had in such contexts—in contract-based
disputes, the presumption of separability of the arbitration agreement (or
even specific parts of the agreement), or the offer-acceptance model in treaty-
based investment disputes—encourage the idea that arbitration stands apart.
When considering whether a policy or practice is “pro” arbitration, scholarly
writings therefore often consider whether it serves the interest of “Arbitration”
(capital “A”). Divorced from context, however, the term “pro” arbitration risks
being hollowed out. To support “Arbitration” in the abstract is to disregard that
its oft-touted values—efficiency, flexibility, neutrality, reduced costs, specialized
expertise, enforceability, etc.—are not a given, or immutable. Indeed, without
context, the “pro” arbitration credentials of even basic building blocks of the
arbitral process—agreed ground rules, and basic guarantees and principles—
can be called into question.
In short, a “pro” arbitration stance cannot (or should not) signify support
for arbitration for its own sake, but rather for the concrete advantages it provides
in resolving any given (kind of) dispute.
* Enikő Horváth is a National Partner at Dechert (Paris) LLP; Columbia University, B.A.,
Class of 2000; and Columbia Law School, J.D., Class of 2004. All views expressed are solely the
author’s.
223
I. THE GROUND RULES
There are now a plethora of arbitral institutions, centers and rules catering
to specific contexts: in addition to the well-established Court of Arbitration for
Sport or the WIPO Arbitration and Mediation Centre, there is now an International
Aviation Court of Arbitration (SIACA, established in 2014) and a Court of
Arbitration for Art (CAFA established in 2018), for instance, with their own
arbitral rules. There are also sector-specific ad hoc rules, like the PRIME Finance
Arbitration Rules or the GAFTA Arbitration Rules (for disputes concerning
grain trade contracts). These specialized rules are, in the main, modeled on the
UNCITRAL Rules, with adjustments that seek to ensure the appointment of
decision-makers with industry knowledge and a tailored procedure, for example,
through expedited timeframes or procedures for the use of technical experts.
The rules of the most established arbitral institutions, in turn, are revised
with increasing frequency and address ever more complex procedural
constellations, as well as external factors that may impact arbitral proceedings.
The 2021 ICC Rules, for instance, introduced new provisions concerning the
joinder of additional parties in the course of the arbitration, the consolidation
of cases in the presence of different parties and third-party funding arrangements.
The 2022 ICSID Rules contain provisions on inter alia mandatory case
management conferences, a presumption of at least two rounds of written
submissions in each proceeding, consolidation or coordination of related cases,
as well as expedited arbitration. Many institutions also provide detailed “notes”
on the conduct of arbitrations under their respective rules.
Most international arbitrations now also rely, to a greater or lesser extent,
on soft law instruments, such as guidelines issued by the International Bar
Association, on the Taking of Evidence in International Arbitration, on Party
Representation in International Arbitration and on Conflicts of Interest in
International Arbitration, or the UNCITRAL Transparency Rules. Such guidelines
and rules address a multitude of issues closely related to the conduct of arbitral
proceedings, generally in an effort to harmonize standards.
These developments evidence dynamic development and engagement with
the criticism voiced in some quarters (especially of investment arbitration) in
recent years. But are increasingly detailed procedural rules and guidelines or
the growing number of sector-specific rules “pro” arbitration? Do they serve to
make any given arbitration simpler, faster and cheaper—or do they create new
battlegrounds and constrain the relative advantages of the arbitral process, for
instance by introducing formalism and rigidity that risks mirroring some of the
perceived defects of litigation? Or, are increasingly detailed and specialized rules
and instruments on procedural matters an indirect mechanism to circumscribe
the scope of the traditionally wide discretion afforded to arbitrators (and
possibly even party autonomy)? And, if it is accepted that decision-making,
including in the conduct of the proceedings, lies at the very core of the arbitral
process, do they not strike at the heart of arbitration?
DOES IT STILL MAKE SENSE TO SPEAK OF BEING “PRO” ARBITRATION? 225
II. UNIVERSAL GUARANTEES
Certain basic guarantees are imperative to any adjudicatory process,

including arbitration: first, the right to be heard; and second, the independence
and impartiality of the decision-makers. References to these pillars of the arbitral
process are ubiquitous and their non-observance gives rise to potential grounds
to deny recognition of an award under international instruments and in
domestic regimes alike.
Both of these guarantees can be—and often are—weaponized, however.
Arbitrator challenges are now commonplace, and the grounds on which
challenges are made proliferating, often at later stages of the proceedings, as
previously undisclosed information becomes public. Regardless of whether a
challenge is used as a dilatory tactic, it tends to result in considerable delay.
Claims of threats to the right to be heard, in turn, appear at times to be used by
(some) counsel as a tool for strategic advantage. Much has been written about
“due process paranoia,” i.e., the perceived unjustified impact on case management
of complaints or threats that a party has not had an opportunity to present its
case fully. Manifestations of this conduct have been said to include (repeatedly)
granting unjustified extensions of time, accepting the belated introduction of new
arguments or evidence, acceding to last-minute requests to reschedule oral
hearings, granting unduly generous disclosure orders or accepting superfluous
submissions. Its consequences—delays, excessive costs, suboptimal decisions
and even misgivings as to the legitimacy of the arbitral process, as a whole—
have been discussed at length.
But there may be another problem. In a 2019 article, Prof. Dr. Jörg Risse
identified an "inconvenient truth”: that the right to be heard is at risk due to
the growing complexity of cases, since arbitrators are humanly incapable of
identifying all relevant facts and then assessing those facts under the
applicable legal provisions. In different terms, many disputes are too complex
to be properly adjudicated by way of arbitration, as arbitrators are faced with
pleadings spanning hundreds of pages, which are supplemented by expert
reports and thousands of pages of exhibits and legal authorities. Prof. Dr. Risse
concluded that even generally accepted procedural features of international
arbitration should be critically re-examined.
In the circumstances, one could wonder: are basic pillars of international
arbitration, like the right to be heard or mechanisms to ensure impartial and
independent arbitrators, “pro” arbitration?
III. OF RECOGNITION AND ENFORCEABILITY
It is a basic tenet of international arbitration, confirmed in most arbitral

rules, that a tribunal should seek to render an enforceable award. However,
arguments concerning the eventual recognition and enforcement of an award
are commonly dismissed by arbitral tribunals as a hypothetical concern—an
exercise in predicting the future—which cannot play any role during the
arbitration itself.
There are good reasons for this approach—the authority of an arbitral
tribunal to consider the claims submitted to it and to rule on them does not
turn on the enforceability of an eventual award, after all. Nor is the potential
for tension between a tribunal’s jurisdiction and the enforceability of any
award it may tender new: it has been widely discussed in the context of the
impact of mandatory foreign laws on the arbitrability of commercial disputes,
for instance. But the issue has grown in prominence in the context of awards
issued pursuant to investor-State arbitration clauses in treaties between or
among EU Member States, which—at least according to EU institutions and
Member States, if not investment tribunals—are incompatible with the EU
treaties not only as a matter of EU law, but also international law, and, as such,
cannot be recognized or enforced.
To the extent that obligations under intra-EU investment treaties and the
ICSID Convention, on the one hand, and EU law, on the other, cannot be
reconciled, there is no obvious solution. But this does not change the fact that
a considerable number of awards are being issued, for which there are clear
grounds for annulment under the domestic laws of EU Member States and/or
the New York Convention or that cannot be recognized or enforced anywhere
other than in breach of EU law. In April 2022, for instance, the Paris Court of
Appeal set aside two intra-EU awards against Poland due to the incompatibility
of the underlying arbitration clauses with EU law.
Is such an outcome “pro” arbitration? It certainly does not result in a
speedy or efficient resolution of the parties’ dispute, since any victory is largely
illusory. It also does not bode well for the legitimacy of international arbitration,
at least within the European Union. The perception that awards are
systematically being issued in the absence of party consent—or indeed over
the objections of both State parties to a bilateral investment treaty—can only
undermine confidence in the arbitral process, with potential ripple effects
beyond investment arbitration, particularly since the lack of consent allegedly
being ignored is that of States (not to mention the views of a sui generis
international organization, to which its Member States have transferred
substantial competences).
IV. IN LIEU OF A CONCLUSION
If the “pro” arbitration credentials of key underpinnings of the arbitral

process can be called into question, does it still make sense to argue about how
far any given policy or practice may or may not serve the interest of
“Arbitration” (capital “A”), in the abstract?
It is, perhaps, time for humbler considerations.
Assessment of whether a policy or practice from within the arbitration
vacuum—specific changes in arbitral rules or approaches to discovery, for
DOES IT STILL MAKE SENSE TO SPEAK OF BEING “PRO” ARBITRATION? 227
instance—is “pro” arbitration may be fascinating, but is rarely fruitful. Most

policies or practices may be “pro” arbitration in some respects, but “anti”
arbitration in others, as Prof. Bermann has noted. To the extent that trade-offs
among “pro” arbitration values are inevitable, innovations—like strict page
limits or increased reliance on tribunal secretaries (to name but two that have
been proposed as measures to increase efficiency and save costs)—will, in any
event, gain acceptance or fade away depending on the specific goal (or goals)
that are prioritized in particular contexts.
Conversely, when assessing the “pro” arbitration credentials of an “extrinsic”
policy or practice, we are essentially considering points of intersection between
arbitration and the “external” realm: the arbitrability of specific kinds of
disputes, the workaday question of whether a policy or practice presumptively
favors the enforcement of arbitration agreements and arbitral awards, etc.
In this context, perceptions of the legitimacy of international arbitration
matter a great deal. Indeed, if one accepts that arbitration is but one form of
alternative dispute resolution—nothing more—then it is necessarily (ultimately)
linked to a specific jurisdiction or legal order, which plays a crucial role in its
continued success. This is true even of ICSID arbitration, which is embedded in
the international legal order, but not entirely “free” of constraints in specific
jurisdictions, at least to the extent that matters of execution expressly remain
subject to domestic law, but arguably even in a wider sense, as the Micula saga
illustrates.
Any given policy or practice of a specific jurisdiction or legal order—
whether “pro” or “anti” arbitration—reflects the value that that jurisdiction or
legal order ascribes to international arbitration as a form of dispute resolution
for a specific type of dispute. The measure of the value—and therefore
relevance—of international arbitration, in turn, is primarily whether it is
capable of resolving the disputes of our times “as advertised:” fairly and
efficiently, and with an effective award. Can it truly be said that international
arbitration is better suited than other forms of dispute resolution to address a
supply chain dispute between companies in different countries caused by
COVID-19, a financial dispute under the ISDA Master Agreement, an investment
dispute arising from climate change and its costs, or territorial claims between
two States, for example?
If the answer is doubtful, the question of whether a given policy or practice
is “pro” arbitration—let alone “pro” Arbitration (capital “A”)—is the least of
the worries faced by the arbitration community. What is at stake is instead the
continued relevance of international arbitration as a means of dispute
resolution for any given (kind of) dispute, and, to the extent that reform may
be needed to address shortcomings, possibly even its identity.
Chapter 39
WHAT DOES IT MEAN TO BE “PRO-ARBITRATION”?
A TAKE ON GUATEMALA
Enrique Martinez Guzman*
Professor George Bermann encourages us to expand our notion of what is

and what is not pro-arbitration, because, as he correctly sets forth, there are
many ways to assess the effects of a policy or practice on international arbitration
(George A. Bermann, What Does it Mean to be “Pro-Arbitration”? 34 Arb. Int’l
341 (2018)). Moreover, there are certain policies or practices that are pro-
arbitration in some respects and anti-arbitration in others (Id.).
One question that tends to be asked in practice is whether a particular
jurisdiction is pro-arbitration or anti-arbitration. This question too oversimplifies
matters. Some jurisdictions promote themselves as being pro-arbitration. As
George Bermann put it “[a]t one time, it may have been sufficient to earn the
title of pro-arbitration for a regime simply to avoid hostility to arbitration.”
(Id.) Notwithstanding, a jurisdiction’s legal system is composed of many laws,
judicial decisions, practices, and policies that, in many ways, may be considered
pro-arbitration, but anti-arbitration in others.
Take Guatemala as an example. The fact that it is a party to the New York
Convention on the Recognition and Enforcement of Foreign Arbitral Awards
(hereinafter, the “New York Convention”) is generally considered pro-arbitration;
so is the fact that its arbitration law is based on the 1985 version of the
UNCITRAL Model Law on International Commercial Arbitration (hereinafter,
the ”Model Law”). However, a more cautious analysis of a single provision of
Guatemala’s Arbitration Law certainly puts into question this assertion.
Instead of the typical recourse available to set aside an award, as is
provided for in the Model Law, the Guatemalan Arbitration Law provides for a
recourse of judicial review. This recourse grants local courts the power to
confirm, revoke, or modify an arbitral award rendered in Guatemala, which
could lead to a review of the merits of the dispute.
Pursuant to the provisions of the Model Law, the courts of the country
where the award was rendered (i.e., the courts with “primary jurisdiction”) can
annul the award on grounds set forth in the Model Law. In Guatemala, if one of
such grounds is met, the competent court may modify or revoke the arbitral
* Enrique Martinez Guzman graduated as an Attorney from Universidad Francisco
Marroquin in Guatemala City, Guatemala. He obtained an LL.M. from Columbia Law School in
2018, and also holds a Masters in Finance from Universidad Francisco Marroquin. He currently
practices as an Attorney in Guatemala and is an Adjunct Professor at the Law School of
Universidad Francisco Marroquin.
229
award. Thus, the court may issue a decision that could modify the award or
substitute it in its entirety. In any case, the Guatemalan courts are empowered
to review the merits of the dispute and, ultimately, resolve the dispute that the
parties had agreed to submit to arbitration. This interpretation was confirmed
by the Guatemalan Constitutional Court in a 2015 decision (Docket number
252-2015, Guatemalan Constitutional Court (2015)).
Another consequence of this provision of the Guatemalan Arbitration Law
is that the effectiveness of the award is greatly compromised. One of the great
benefits of arbitration and of the New York Convention is the ability to enforce
awards in other jurisdictions, with relative ease. For an award rendered in
Guatemala, that may not be the case. If the award is reviewed by the local
courts—assuming that at least one of the grounds for judicial review was met-,
there are two possible outcomes: (a) an award partially modified by a judicial
decision; or (b) a revoked award substituted, completely, by a judicial decision.
A question then arises as to whether this “modified award” or “substituted
award” could be enforced elsewhere. Maybe a more fundamental question
would be: can it still be considered an arbitral award subject to enforcement?
Of course, these questions will be left to the courts of the secondary
jurisdictions to decide. Notwithstanding, it can certainly be questioned whether
a reasonable party would choose Guatemala as the seat—or governing law—of
an international commercial arbitration if there are questions pertaining to the
enforceability of the award in other jurisdictions, inviting to further litigation.
To properly assess the arbitration-friendliness or unfriendliness of this
provision of the Guatemalan Arbitration Law, a comprehensive analysis must be
made. On the pro-arbitration side, this provision helps ensure the independence
and impartiality of arbitrators, as well as a party’s right to be heard, because the
reviewing local court will ascertain that the award was rendered in such a way,
and, if it was not, it has the power to issue a decision that will substitute it.
Certainly, this provision also intends to promote accuracy in the administration
of justice because it grants local courts “correcting powers.” On the anti-
arbitration side, this provision renders arbitration uneconomical in terms of time
and costs, particularly if the merits of the dispute may be revisited. The provision
also incentivizes the intervention of national courts undermining the agreement
of the parties to have their dispute solved through arbitration. And, in my opinion,
the fact that it compromises the effectiveness of an award, precluding its
enforceability elsewhere—or at least casting doubt to that effect—outweighs
any purported benefit or pro-arbitration consideration.
Certainly, determining whether a particular practice or policy is pro-
arbitration or anti-arbitration is a complex exercise. Determining if a whole
legal system is arbitration-friendly or not is a daunting challenge.
Let this be part of the compounding effect of Professor Bermann’s teachings.
Chapter 40
READING BETWEEN THE LINES, OR HOW I READ
MY FIRST 4000-PAGE TREATISE
Eric Lenier Ives*
In 2017, Professor Bermann gave me a choice: write a 4-page essay on EU

law and investor-State arbitration, or survey Gary Born’s 4000-page International
Commercial Arbitration (2d ed.) with two classmates for any mention of what
it means to be “pro-arbitration”. Fortunately—particularly for the purposes of
this essay—I chose the latter.
At first glance, Born offers 17 particular mentions of “pro-arbitration” in
his treatise. There you have it: research project complete, what a bargain. As
with all things, however, the devil is in the details. Even a casual reader will
quickly realize that “pro-arbitration” considerations permeate Born’s text, with
every phase of the arbitral process (as well as arbitration’s relationship to
domestic courts) necessarily implicating “pro-” and “anti-” arbitration policy
choices and concerns. From those 17 initial references, at the end of our review,
we identified 141 instances of pro-arbitration reasoning, several in each chapter.
Importantly, Born’s treatise is largely descriptive. He does not explicitly
advocate for what is or is not “pro-arbitration.” Rather, he sets out how certain
processes and policy choices support or undermine the arbitral process. From
the presumptive validity of an arbitration agreement, to the enforceability of
awards, the arbitral process is filled with local decisions imbued with global
consequences. Prof. Bermann’s 2018 article, “What does it mean to be ‘pro-
arbitration’?” reminds us, however, that describing something as “pro-
arbitration” relies on assumptions about what is good for arbitration.
Recalling the analysis we did of Born’s treatise years ago, we noted that
Born placed a premium on party autonomy. Arguably one of arbitration’s key
advantages from the perspective of its users is that it is tailored to the needs of
the parties’ dispute and can be customized by party agreement. Parties can
control everything from arbitrator appointments to document disclosure and
confidentiality. In a world with few certainties, control is a valuable commodity.
In effect, the “pro-arbitration” approach was one which supported the parties’
expectations for control.
However, this cannot be the end of the story. As Prof. Bermann points out,
a policy may be regarded as arbitration-friendly, even where it curtails party
* Eric Lenier Ives is an Associate in the International Arbitration group of White & Case LLP
in New York. He graduated from Columbia Law School as a James Kent Scholar and New York
University with Phi Beta Kappa distinction. During law school, he worked as Prof. Bermann’s
research assistant and represented Columbia in the Vis moot, advancing to the Round of 8.
231
autonomy so long as it upholds arbitration’s broader legitimacy. Prof. Bermann

calls these considerations “trade-offs”—the “price to the interests of arbitration
narrowly conceived.” And perhaps a party-centric understanding of “pro-
arbitration” is too narrowly conceived. It is, at least, vulnerable to a creeping
tautology: a position is said to be good for arbitration because it furthers the
goals of the pro-arbitration perspective. What we consider “pro-arbitration” to
mean, then, is vital.
Armed with this research and a lengthy Excel spreadsheet, we submitted
our findings to Prof. Bermann. At the next session of our class, we referred to
Born’s treatise and pondered the question with the whole seminar. At the end
of our discussion, he gave a phrasing of “pro-arbitration” so compelling that I
wrote it down in a notebook (which I recently unearthed preparing for this essay):
Pro-arbitration is that which supports fair and neutral procedures

which are expert, efficient, and tailorable to the needs of a particular
dispute without being bound by the formalities and technicalities of
procedural rules applicable in national courts.
Reflecting on this work and Prof. Bermann’s words now, it is a reminder

that practitioners face the “pro-arbitration” question every day. It is easy to
lose sight of the global consequences of our Redfern Schedules or our
confidentiality designations or the public availability of the hearings or the
award, but Prof. Bermann reminds us that the legitimacy of the system is a
fundamental part of the system itself, not something outside of arbitration.
Writing on the eve of my first investment arbitration hearing, I note that in
his 2018 paper, Prof. Bermann put ISDS to one side and set his focus on
international commercial arbitration. He decried the “hollow ring” of labels
like “pro-arbitration” or “anti-arbitration” in the heavily politicized realm of
foreign policy and investment law. But the two have evolved together and have
something to learn from one another. Whether investment arbitration
transforms into a fundamentally different investment court model remains
uncertain, as do UNCITRAL’s Working Group III (WGIII) reform proposals.
However, the tectonic shifts in ISDS have fostered a rich discourse about the
underlying values and future of arbitration. Most “pro-arbitration” debates
occurring today are occurring in the wake of WGIII’s monumental efforts to
reform the ISDS system, and one hopes that this discourse is also engendering
the development of international commercial arbitration. For example, the
development of ICSID and UNCITRAL’s Code of Conduct for international
adjudicators will likely set key norms in international arbitration practice not
limited to the ISDS system, bolstering the legitimacy of the entire system, and
parties may come to expect these and similar mechanisms. Some
commentators refer to this as arbitral “cosmopolitanism”—a shared
understanding of expertise and procedural baselines across the arbitrating
worlds. At the same time as parties desire control, they also desire a fair
READING BETWEEN THE LINES 233
hearing, a legitimate system, and an enforceable award. In this way, “pro-

arbitration” must constantly evolve as a global understanding of these
principles does.
Prof. Bermann challenges us to consider the values underlying “pro-
arbitration”, and a critical next step may be considering what happens when
“arbitration” evolves into a new form. Is it “pro-arbitration” to draw lines between
investment arbitration adjudicated by a standing international court and ad
hoc investment arbitration? Is it “pro-arbitration” to shoehorn the commercial
arbitration system into the 1960s definition of “tribunal” for purposes of U.S.-
style discovery? These and other pressing questions will require practitioners
who do not shy away from asking what we mean when we say “pro-arbitration.”
Whatever the future holds, the question, “What does it mean to be ‘pro-
arbitration’?” must be a mindset: a willingness to see the global implications of
each proceeding, engage in earnest discourse (both scholarly and practical),
and advocate for party autonomy but know when to cede it. Looking back on
the last five years, I can only imagine where I would be if I had written the
4-page essay on EU law instead. Fortunately, I chose the latter.
Chapter 41
SHORT REFLECTIONS ON THE PRO‐ARBITRATION
CHARACTER OF A PRE‐DISPUTE WAIVER OF THE
RIGHT TO APPEAL A JUDGMENT CONFIRMING OR
VACATING AN ARBITRATION AWARD AND OF
THE RIGHT TO RESIST RECOGNITION AND
ENFORCEMENT UNDER ARTICLE V(1) OF THE
NEW YORK CONVENTION
Erico Bomfim de Carvalho*
This short essay addresses whether a pre-dispute arbitration agreement

containing a double waiver clause—a waiver of the right to appeal a judgment
confirming or vacating an arbitration award in conjunction with a waiver of
the right to resist recognition and enforcement under Article V(1) grounds set
out in the New York Convention—serves to advance international arbitration’s
purposes by decreasing the level of judicial intervention in the arbitral process.
Applying Professor’s Bermann descriptive framework for measuring the pro-
arbitration character of a policy or practice, we conclude that the hypothetical
clause discussed here distinctly serves international arbitration’s well-being.
I. PRE‐DISPUTE WAIVER OF THE RIGHT TO APPEAL A COURT’S

JUDGMENT CONFIRMING OR VACATING AN AWARD
We first consider whether an agreement proscribing appellate review of a

court’s judgment confirming or vacating an arbitral award advances the
achievement of international arbitration’s purposes in the vacatur context.
Generally, courts at the seat of arbitration retain jurisdiction to adjudicate
an application to confirm or vacate an arbitral award. As an additional
safeguard, most jurisdictions allow the parties to appeal a court’s judgment
confirming, vacating, correcting, or modifying the arbitral award. A general
question that has been frequently raised is whether parties can contractually
modify, ex ante, the grounds on which a court can review an arbitral award.
* Erico Bomfim de Carvalho is a Partner of Advocacia Velloso in Brasília (Brazil). He advises
and represents clients in complex commercial disputes and private international law matters
before the Brazilian Superior Court of Justice and the Brazilian Supreme Court. He holds an LL.M.
from Columbia Law School (2016), where he was a Harlan Fiske Stone Scholar, a student editor
of the American Review of International Arbitration ‐ ARIA, and a recipient of the Parker School
Certificate for Achievement in Foreign and Comparative Law.
235
More specifically, if parties are allowed to draft clauses providing for heightened,
reduced, or even no judicial review at all.
Despite the limited case law, the dominant view among U.S. courts is that
parties are not allowed to draft clauses providing for heightened, reduced, or
even no judicial review. In Hall St. Associates, L.L.C. v. Mattel, Inc., 552 U.S. 576
(2008), the United States Supreme Court held that the standards set forth in
the Federal Arbitration Act (FAA) are exclusive and cannot be expanded by
private arrangements. Following that decision, courts consistently established
that parties cannot contract for a more expansive review of an award governed
by the FAA. On the other hand, courts have conflicting decisions on whether
agreements eliminating the scope of judicial review are enforceable under the
FAA. A small group of courts has held that private agreements purporting to
eliminate judicial review should be enforced as parties are free to dictate the
terms of their own contracts. See, e.g., Bowen v. Amoco Pipeline Co., 254 F.3d
925 (10th Cir. 2001) (holding, in dicta, that an arbitration agreement may
eliminate judicial review provided that the parties’ intention is clear and
unequivocal). Conversely, most courts have refused to enforce contractual
arrangements that attempt to eliminate all challenges to the arbitral award.
See, e.g., Hoeft v. MVL Group., Inc., 343 F.3d 57, 63 (2d Cir. 2003) (holding that
private parties cannot deprive federal courts of the authority to apply the
standards set forth in the FAA). Ultimately, the American Law Institute’s
Restatement of the U.S. Law of International Commercial and Investor-State
Arbitration adopted the position that parties cannot, even through express
agreement, expand, reduce, or eliminate the grounds for reviewing arbitral
awards.
While U.S. courts have generally refused to enforce arbitration agreements
expanding or limiting the scope of judicial review, other jurisdictions have
enacted statutes recognizing the enforceability of a clear and unequivocal
annulment waiver. Article 1718 of the Belgian Code allows parties to “exclude
any application for the setting aside of an arbitral award,” provided there is an
explicit declaration in the arbitration agreement (or later agreement) and
provided none of them is Belgian or has its domicile, normal residence, or main
place of business in Belgium. Similarly, Article 192 of the Swiss Private
International Law Act (PILA) allows parties not domiciled in Switzerland to
“waive fully the action for annulment,” or to limit the standard of review “to
one or several of the grounds” available.
Given the lack of uniformity of interpretation across jurisdictions,
contracting parties willing to include a pre-dispute annulment waiver in their
arbitration agreements should take special consideration when indicating the
governing law of the main contract, the law of the arbitration agreement and
the seat of arbitration. Notwithstanding the availability of pre-dispute
annulment waivers in certain jurisdictions, we believe that an intermediate
solution, consisting of a non-appealability clause waiving the right to appeal a
REFLECTIONS ON PRO-ARBITRATION CHARACTER OF PRE-DISPUTE WAIVER 237
court’s judgment confirming or vacating an award, would better serve

international arbitration’s purposes.
A no-appeal clause is a sui generis agreement that should not be categorized
either as a contractual expansion nor as a contractual limitation on the scope
of review. In MACTEC, Inc. v. Gorelick, 427 F.3d 821 (10th Cir. 2005), the Tenth
Circuit had to decide whether the parties to an arbitration agreement are
allowed to contractually waive their right under the FAA to appeal a judgment
confirming or denying confirmation of the award. In reaching its conclusion,
the Tenth Circuit ingeniously fashioned an intermediate solution upholding the
enforceability of a specific provision proscribing appellate review of a district
court’s judgment, particularly because such waiver would not proscribe judicial
review, thus preserving the main policy concerns under the FAA.
We agree that the enforceability of a pre-dispute waiver of the right to
appeal a court’s judgment confirming or vacating an award is unquestionably
pro-arbitration since it keeps the intervention of national courts in the arbitral
process to a minimum, while still allowing them to perform an important
supervisory function over the validity of the award. Moreover, such a waiver
advances international arbitration’s fundamental policy favoring cost-efficient
dispute resolutions. Conversely, it may be argued that a pre-dispute waiver of
the right to appeal reduces the judicial scrutiny of the arbitral award and creates
tension with an important due process right that is extrinsic to arbitration.
This argument is not persuasive. Courts customarily enforce non-appealability
waivers and that same treatment should be applied to the court’s review of
arbitration agreements. Additionally, the Supreme Court has consistently
asserted that there is no constitutional due process right to appeal. See, e.g.,
M.L.B. v. S.L.J., 519 U.S. 102, 131 (1996) (Thomas, J., dissenting) (holding that
“due process does not oblige States to provide for any appeal, even from a
criminal conviction”). Finally, it should be emphasized that the no-appeal waiver
discussed here still preserves a single-level of judicial review and the application
of the existing statutory grounds. It does not restrict the scope of judicial scrutiny
of the award; only the availability of an appeal from a court’s judgment
confirming or vacating an award.
In sum, a no-appeal clause should be held facially valid and enforceable by
courts as it reduces litigation costs, abbreviates disputes, and reinforces the
finality of arbitral awards, while ensuring judicial review to correct any offense
to the principles of fundamental fairness and due process.
II. PRE‐DISPUTE WAIVER OF THE RIGHT TO RESIST RECOGNITION

AND ENFORCEMENT UNDER ARTICLE V(1) OF THE NEW YORK
CONVENTION
While a pre-dispute waiver of the right to appeal a court’s judgment

confirming or vacating an award passes the pro-arbitration test with ease, a
waiver of the right to resist recognition and enforcement of the award may be
open to criticism. Nevertheless, a more limited waiver, restricted to the grounds

for denying recognition and enforcement set out in Article V(1) of the New York
Convention, is enforceable and arbitration-friendly.
It is our understanding that the grounds set out in Article V(1) are inherently
waivable. Article V(1) provides an exhaustive list of five grounds upon which
recognition and enforcement of the award “may be refused at the request of
the party against whom it is invoked.” If Article V(1) defenses are discretionary,
parties should be allowed to waive them ex ante through express agreement.
The same is not true with Article V(2) grounds. Article V(2) states that “the
competent authority” may refuse recognition and enforcement if it finds that
the dispute is non-arbitrable or if it violates public policy. That seems to
suggest that national courts may invoke both grounds on their own motion.
Here, public concerns override the private interest of the parties in modifying
the grounds for recognition and enforcement. In that sense, a procedural private
ordering cannot proscribe national courts from deciding ex officio whether a
claim is non-arbitrable under their own domestic law or if the award is offensive
to its own domestic public police. Thus, a waiver of the right to resist recognition
and enforcement under Article V(1), while leaving untouched the grounds set
out in Article V(2), should be upheld as it advances the Convention’s pro-
enforcement bias. The waiver also improves party autonomy and minimizes
the intervention of national courts, while still offering adequate public policy
protection to the place where recognition and enforcement is sought.
This waiver does not, however, escape criticism entirely. It may be argued
that a pre-dispute waiver of the right to resist recognition and enforcement
under Article V(1) creates a situation of less than full judicial review of the
arbitrator’s decision in violation to due process. Yet, a more thorough review
of the award should be conducted by the courts at the seat of arbitration, not
by the ones at the forum of the recognition and enforcement. Moreover, the
grounds set out in Article V(2) would remain available to courts and parties,
thus preserving the adjudication of public policy defenses and arbitrability
issues. The waiver described here may also lead to an unintended consequence:
the impossibility of raising Article V(1) defenses during the recognition and
enforcement stage may incentivize the losing parties to preemptively file
annulment actions before the competent court at the seat. That is certainly
contrary to both the letter and spirit of arbitration. Still, when the waiver of
the right to resist recognition and enforcement under Article V(1) is combined
with a waiver of the right to appeal a court’s decision confirming or annulling
an award, national courts’ intervention in the vacatur context will be kept to a
minimum. Finally, critics may argue that the suppression of grounds for
challenging a recognition and enforcement request also disrupts the uniform
standards of review under the Convention. However, there is no guarantee that
a national court at the recognition and enforcement stage will apply the
Convention in a predictable and uniform manner. The grounds for challenging
recognition and enforcement of a foreign arbitral award are exceptionally
REFLECTIONS ON PRO-ARBITRATION CHARACTER OF PRE-DISPUTE WAIVER 239
limited, but not mandatory. In fact, articles V(1) and V(2) of the New York
Convention designate the exclusive grounds upon which recognition and
enforcement of the award “may be refused.” The permissive language of the
Convention suggests that national courts have the discretion to recognize and
enforce an award even if one of the grounds for refusal is established. As a
result, efficacy and uniformity depend in great measure on the national courts’
interpretation and application of the Convention. The practice has shown,
nonetheless, a lack of uniformity in interpretation across jurisdictions.
III. CONCLUSION: THE PRO‐ARBITRATION CHARACTER OF THE

DOUBLE‐WAIVER CLAUSE
There is a clear trade-off between competing pro-arbitration practices and

policies when parties contract for a narrower judicial review: in conferring
more weight to the arbitrator’s decision, parties sacrifice some of the safeguards
and protections made available by the lex arbitri and the New York Convention
in exchange for a faster resolution of the dispute. They are trading the prospects
of a statutory judicial review for a more limited, simpler, and speedier procedure.
As the preceding discussion has shown, a pre-dispute arbitration agreement
encompassing a waiver of the right to appeal a judgment confirming or
vacating an arbitration award and a waiver of the right to resist recognition
and enforcement under Article V(1) of the New York Convention serves to
advance international arbitration’s purposes in different ways. Efficiency and
finality prevail. While minimizing the interference of national courts in the
arbitral process, the double-waiver clause discussed here promotes international
arbitration’s fundamental policy favoring cost-efficient dispute resolutions.
Party autonomy is also respected. Importantly, the judicial intervention afforded
enhances arbitration’s legitimacy by ensuring that the parties’ due process
rights are preserved. All offenses to the lex arbitri (in the vacatur context) or
to public policy (at the recognition and enforcement stage) have a chance to be
corrected.
Chapter 42
IS ARBITRATION STILL “FRIENDLY” FOR THE
RESOLUTION OF DISPUTES? – A REFLECTION IN
LIGHT OF EFFICIENCY AND DUE PROCESS
CONCERNS IN INTERNATIONAL ARBITRATION
Esra Ogut Oehri*
In today’s globalized world, arbitration has become one of the most

popular alternative dispute resolution mechanisms. Although the reasons for
choosing arbitration are manifold, the time and cost efficiency of arbitration
used to play the central role in parties’ considerations. In this respect, the
common concerns of the users of international arbitration about the delays
and high expenses of arbitration, while having access to fair proceedings in
accordance with the requirements of due process provoke an inevitable dilemma
for the international arbitration community.
There are no clear-cut international rules as to how and when due process
shall be observed in the arbitration proceedings. Due process constitutes one
of the most fundamental guarantees of judicial procedure. In this respect, due
process is defined as “an umbrella concept for various guarantees of procedural
justice affecting the various stages of the arbitral process” (Franco Ferrari,
Friedrich Jakob Rosenfeld, et al., “Chapter 1: General Report”, in Franco Ferrari,
Friedrich Jakob Rosenfeld, et al. (eds), Due Process as a Limit to Discretion in
International Commercial Arbitration, 2020, p. 6). Indeed, the concept of due
process in international arbitration requires that the parties’ agreement to
arbitrate will be respected and enforced, that they will have access to
arbitration as their selected method of dispute resolution, and that they will
have an opportunity to present their case. Thus, the right to be heard and right
to be treated equally by independent and impartial arbitrators constitute the
core guarantees of the concept of due process.
The challenging question is, however, to what extent is it possible to ensure
efficient arbitration proceedings while addressing all of the parties’ potential
due process concerns? In other words, to what extent is it possible to ensure
efficiency in arbitration in terms of costs and time, while protecting an award
from being challenged based on due process grounds? This challenging issue
represents one of the common concerns encountered by the international
arbitration community with respect to pro-arbitration values.
* Esra Ogut Oehri is an Associate at LALIVE’s Zurich office. As a dual-qualified lawyer, she
specializes in international commercial and investment arbitration. Esra graduated in law from
Koç University in Istanbul and holds an LL.M. from Columbia Law School.
241
Traditionally, a policy or practice in international arbitration is considered

to be “pro-arbitration” or “arbitration-friendly” insofar as it achieves the goals
set for the arbitration. These goals are manifold and include, among others,
fairness, accuracy, efficiency of the proceedings and an enforceable award. In
other words, if a particular policy or practice serves these goals, it is considered
to be pro-arbitration. However, as pointed out by Professor Bermann, today it
requires more for a policy or practice to be described as arbitration-friendly
(George A. Bermann, “What Does it Mean to be ‘Pro-Arbitration’?”, 34 Arb. Int’l
341 (2018), pp. 342–343).
Indeed, when it comes to the swiftness of arbitration proceedings and
their low costs, there are doubts even within the arbitration community itself
as to the “arbitration-friendliness” of the proceedings. For instance, when a
party makes abusive procedural requests that “vaguely allude to due process
concerns,” most of the time, the arbitral tribunal finds itself in a challenging
position of weighing its obligation to manage the arbitration proceedings
efficiently against its obligation to prevent the potential annulment of the
award based on a due process violation. As a result, when arbitral tribunals
are confronted by relentless due process complaints, they sometimes have
the tendency to grant a party’s procedural request for an extension of time,
or a request for an additional submission or for the postponement of a
hearing out of concern that the award might be challenged by reason of a
potential breach of that party’s due process rights—the well-known “due
process paranoia.” All these requests and related decisions or procedural
orders sometimes inevitably cause additional delay and costs to the
detriment of the other party. Besides, such repeated “concessions” by arbitral
tribunals risk undermining the significance of due process and damaging the
integrity of the proceedings.
In this respect, arbitral tribunals should recognize that speed and
efficiency are as central to the conduct of the proceedings as the adherence to
due process concerns. In practice, such concerns arising from due process
paranoia often result in prolonged proceedings that are not in the parties’
interests, raise costs and negatively affect the attractiveness of international
arbitration as an alternative dispute resolution mechanism. Therefore,
efficiency and due process can be construed as the two sides of the same coin
and, in certain instances, it might indeed be difficult to find the right balance
between the two.
This inevitable confrontation encountered in practice poses the challenging
question as to what extent it is possible to describe a certain practice as “pro-
arbitration,” if it fails to satisfy one of the main pillars of this concept: fairness,
accuracy and efficiency. Does one pillar override the others? How do we assess
these competing pro-arbitration values? Although one option would be to aim
for concession and compromise by seeking the least detrimental measure over
another; unfortunately, there is no straightforward formula to answer this
question.
IS ARBITRATION STILL “FRIENDLY” FOR THE RESOLUTION OF DISPUTES? 243
One pro-arbitration value, which might appear to be detrimental against

another one, might be perfectly suitable or preferable in view of the societal
values and legitimate public interest. A typical situation in which we see this
internal tension between pro-arbitration values is the application of soft law
instruments in the field of arbitration. For instance, while the application and
observance of the International Bar Association (IBA) Guidelines on Conflicts
of Interest or the IBA Rules on the Taking of Evidence in International
Arbitration might cause delay and increased costs in the short term, it would
also ensure the legitimacy of arbitration by increasing transparency and
accountability and hence strengthens the parties’ confidence in the system. In
this respect, the inclusion of these soft law instruments rather contributes to
the development of the field and bolsters predictability and harmonized
international standards in the long term.
Thus, the “arbitration-friendliness” of a policy or practice should not be
assessed solely based on the limited criteria considered by the involved
parties, but rather it should be evaluated from a broader perspective in line
with the core values that the arbitration system aims to protect. In this respect,
instead of limiting the assessment of “arbitration-friendliness” of a policy or
practice to only cost and time efficiency, or any other particular criteria, the
policy or practice should be considered as a whole in order to determine
whether it supports the legitimacy of arbitration in general. After all, a policy
or practice in arbitration might only be considered “friendly” to the extent that
it enhances the overall legitimacy of international arbitration as a dispute
resolution mechanism.
In a world with ever-increasing cross-border transactions and the need to
act faster, the speed and efficiency of arbitration remain among the main
reasons why parties choose arbitration over court proceedings in many
jurisdictions. On the other hand, the tension between the pro-arbitration
values mentioned above adds an additional layer of complexity to the dispute,
which might make the “arbitration-friendliness” of the whole process
questionable. The point is that in an era with increasingly complex cross-
border issues, one of the key reasons why parties prefer arbitration as opposed
to other dispute resolution methods is because arbitration promises the
fastest and simplest solution while ensuring the fairness and efficiency of the
proceedings. Users would always tend to prefer simplicity over complexity,
flexibility over rigidity, and innovation over conventionalism (Sundaresh
Menon, “Dispelling Due Process Paranoia: Fairness, Efficiency and the Rule of
Law”, in Lawrence Boo and Gary B. Born (eds), Asian International Arbitration
Journal, Kluwer Law International 2021, vol. 17 issue 1, p. 27). Thus, a policy
or practice that complicates the dispute by increasing the stakes and making
the resolution of the dispute more unattainable, rather than simplifying the
process and facilitating the resolution of the dispute would only hurt the
“friendliness” of arbitration as an institution. Hence, in order for arbitration to
preserve both its “pro-arbitration” values and its position among the
alternative dispute resolution mechanisms, arbitrators should abstain from

due process paranoia and instead strive to find harmony among these
competing values by assessing the issues from the broader perspective of
legitimacy.
Chapter 43
THE FALSE PROPHETS OF INTERNATIONAL
ARBITRATION
Florian Grisel*
In a tribute to another great professor, Prosper Weil once described “the

honour of jurists” as their capacity to detach themselves from a narrow
understanding of the law and embrace broader normative debates about the
legitimacy of legal action. The call for a broad understanding of the law is
particularly relevant in the field of international arbitration, which, over the
past few decades, has grown to become the preferred method for settling
important business disputes. In this context, Professor George Bermann’s defence
of an analysis that accounts for a wider range of values than those informing
the field is not only welcome, but also highly relevant. Professor Bermann raises
the question of what it means to be “pro-arbitration”. His argument resonates
in the context of the widespread belief in “arbitration circles” that international
arbitration is under attack and that a “pro-arbitration” stance is warranted to
address these attacks; he makes a plea for a balanced approach that considers
wider societal values “in ways that surpass—and properly outweigh—
international arbitration’s interests narrowly conceived.”
In this short essay, I argue that Professor Bermann’s plea is most welcome.
It reflects a broad conception of the law that tends to be ignored among supporters
of international arbitration. I also argue that the alarmist discourses that are
often used to induce arbitration practitioners to close ranks have deleterious
effects on the vibrancy of debates concerning this field, which ultimately discredits
these discourses. In short, the “pro-arbitration” stance is likely to lead to the
exact opposite of what its supporters are hoping to achieve.
I. UNDERSTANDING INTERNATIONAL ARBITRATION IN SOCIETY
Professor Bermann’s argument that international arbitration should not be

analysed according to its own set of values, but rather within a broader range
of societal constraints, is entirely consistent with a fundamental tenet of socio-
legal studies. Socio-legal scholars understand law as a part of society. Accordingly,
they refuse to seclude the law from the social forces that underlie its functioning.
In their view, legal systems cannot be fully understood unless they are
considered within the broader context of the societies in which they operate,
an approach that is still deemed unacceptable in certain parts of the world.
With a few exceptions, it has also had very little influence on the scholarship
* Florian Grisel is an Associate Professor of Socio-Legal Studies at the University of Oxford.

245
on international arbitration, which is largely dominated by scholars or

practitioners who adopt a very narrow understanding of the law. A sign of this
dominance is that very few studies of international arbitration are based on
empirical data. In addition, influential scholars of international arbitration
tend to analyse it within the bounds of the knowledge they have acquired in
this field. Consequently, their discourse is embedded within a specific set of values
that result from a particular social history and trajectory. A recent doctoral
thesis by Amina Hassani offers rare insights into how the notion of “neutrality”
in the field of international arbitration takes its roots in the decolonisation period
and can therefore be deconstructed in a broader context. Regrettably, the “pro-
arbitration” discourses that have arisen in the past few years are framed on a
deep level (perhaps even unbeknownst to their holders) by the context in which
they have emerged. As a result, these discourses are correspondingly self-
referential, and the biases they betray undermine their overall value. Moreover,
when the proponents of these discourses dare to broaden the scope of their
inquiry, their efforts often result in comparisons that are taken out of context
or, worse still, that are largely irrelevant. I will give a few examples of these
efforts further below.
II. THE (OVER)ZEALOUS GUARDIANS OF THE TEMPLE OF ARBITRATION
Over the past few years, the expansion of international arbitration and its
“normalisation” has created some friction with other social and legal systems.
This friction seems quite natural if one considers the fact that arbitrators have
been allowed to decide matters that are traditionally deemed to be the
monopoly of states (because they involve the public interest) and that a whole
range of legal instruments (e.g. the New York Convention of 1958 or the
Washington Convention of 1966) has sustained the development of international
arbitration in ways that constrain or limit state sovereignty. In this context,
some actors—usually state courts, but also arbitral tribunals—have been
tempted to build safeguards or interpret arbitral powers in ways that are more
protective of state sovereignty (an approach that is not unheard of in other
international courts, for instance, the International Court of Justice). In almost
all these cases, prominent arbitration practitioners have been very vocal when
defending the autonomy of international arbitration. An analysis of these
reactions, which must remain superficial here due to space constraints, provides
relevant evidence of the ways in which the “pro-arbitration” discourse is
incredibly impervious to broader societal values and debates. This feature is
particularly conspicuous considering that most of these critiques originate
from actors who use an academic guise to advance what is evidently a non-
scholarly discourse. I will cite two examples in support of my argument.
THE FALSE PROPHETS OF INTERNATIONAL ARBITRATION 247
A. Mitchell v. DRC (ICSID Ad Hoc Committee)
Mitchell v. DRC is a case brought by Patrick Mitchell, a US national and lawyer,

against the Democratic Republic of Congo (DRC) before the International Centre
for the Settlement of Investment Disputes (ICSID). In 2004, an ICSID arbitral
tribunal held that the DRC expropriated Mitchell of its investment under the 1984
bilateral investment treaty (BIT) between the US and Zaire (now the DRC). The
DRC then sought the annulment of the 2004 arbitral award before an ad hoc
ICSID Committee. In 2006, the ad hoc Committee decided to annul the 2004
arbitral award on the grounds that Mr Mitchell had not made an “investment” that
could be protected under the relevant BIT and the Washington Convention. At
the heart of the ad hoc Committee’s reasoning lies the idea that in order to be
protected under the Washington Convention, an investment needs to contribute
in some fashion to the economic development of the host state. The relevant
excerpt of the ad-hoc Committee’s reasoning is the following:
As a legal consulting firm is a somewhat uncommon operation from the

standpoint of the concept of investment, in the opinion of the ad hoc
Committee it is necessary for the contribution to the economic
development or at least the interests of the State, in this case the DRC,
to be somehow present in the operation. If this were the case, qualifying
the Claimant as an investor and his services as an investment would be
possible; furthermore it would be necessary for the Award to indicate
that, through his know-how, the Claimant had concretely assisted the
DRC, for example by providing it with legal services in a regular manner
or by specifically bringing investors.
The idea does not seem revolutionary, especially given that it finds at least
some support in an oft-quoted ICSID arbitral award (laying out the so-called
“Salini test”) and that the very first paragraph in the Preamble of the Washington
Convention refers to the “need for international cooperation for economic
development, and the role of private international investment therein”. One
should also keep in mind that the ICSID is one of the five agencies of the World
Bank, an international institution whose mandate is to free the world of
poverty (the complete sentence on the entrance of the World Bank’s headquarters
is “Our dream is a world free of poverty”).
However, the guardians of international arbitration seem to care little
about the World Bank’s dream of freeing the world of poverty. I remember the
overdramatic comments made by arbitration insiders when the ad hoc
Committee issued its decision. Their main concern was that by restricting the
category of protected investments under the Washington Convention to those
contributing to the economic development of the host state, the Mitchell v. DRC
decision would create a dangerous precedent that could hinder the development
of ICSID arbitration. This incredibly narrow consideration was at no point
weighed against the broader need to protect the “right” kind of investment,
consistent with the historical goals of the World Bank to which the ICSID
belongs. The lead counsel for Mr Mitchell went as far as to cast 2006 as a “black
year for ICSID” based, inter alia, on this decision. Some of his arguments are
worth considering here in their entirety:
[…] it is even more remarkable that the committee decided that the
concept of investment should be defined—notwithstanding the
intentional absence of any definition of an ‘investment’ at Article 25 of
the convention—in accordance with the preamble of the Washington
Convention and its reference to the ‘international cooperation for
economic development’ (para. 28) and that ‘the Washington Convention
has supremacy over an agreement between the parties or a BIT’ (para. 31)
or, in other words, that ‘such concept of investment should prevail over
any other ‘definition’ of investment in the parties’ agreement or in the
BIT’ (para. 25).
Two main critiques are advanced here: (i) the ad hoc Committee’s efforts
should not have construed an undefined term in a treaty in light of its preamble
and (ii) the parties’ agreement and/or the BIT should prevail over the text of
the Washington Convention. The first critique can be easily disposed of, since
the rules of treaty interpretation command the interpreter to consider the
terms of a treaty “in their context and in the light of its object and purpose”
(Vienna Convention on the Law of Treaties, Art. 31(1)). It is understood that
this “context” comprises the “preamble” of the treaty (Vienna Convention on
the Law of Treaties, Art. 31(2)). The second critique is more problematic and
is subject to debate. I will simply note that the same Prosper Weil who referred
to the “honour of jurists” resigned as president of an ICSID tribunal because he
disagreed with his co-arbitrators on this issue. His words deserve to be quoted
here: “It is the [Washington] Convention which determines the jurisdiction of
ICSID, and it is within the limits of the ICSID jurisdiction as determined by the
Convention that the Parties may in their BIT define the disputes they agree to
submit to an ICSID arbitration.” The issue is far from obvious, and it is not
particularly “remarkable” that the ad hoc Committee chose a particular side in
this debate.
B. Inserm v. Foundation Letten F. Saustad (Tribunal des Conflits)
The second example is drawn from a case decided in 2010 by a peculiar

French court called the Tribunal des conflits. As its name indicates, the Tribunal
des conflits oversees the “conflicts” that may arise between two types of French
courts: civil courts and administrative courts. The jurisdictional split between
civil courts and administrative courts is a fundamental feature of the French
legal system. For more than a century, the Tribunal des conflits has drawn fine
THE FALSE PROPHETS OF INTERNATIONAL ARBITRATION 249
lines between, for instance, “services publics industriels et commerciaux”

(falling under the jurisdiction of civil courts), on the one hand, and “services
publics administratifs” (falling under the jurisdiction of administrative courts),
on the other, or between the “faute personnelle” of public agents (civil courts),
on the one hand, and their “faute de service” (administrative courts), on the
other. I could give many more examples, but the reader has surely understood
my point: the Tribunal des conflits is entrusted with the difficult and necessary
task of drawing jurisdictional lines that guarantee the unity of the French legal
system. This task is usually understood and accepted by French lawyers,
except apparently the guardians of international arbitration.
In the case of Inserm v. Foundation Letten F. Saustad, the Tribunal des conflits
was asked to decide whether civil courts have jurisdiction over the annulment
of arbitral awards involving public entities (as is traditionally assumed to be
the case) or whether administrative courts have jurisdiction over these cases. As
is often the case, the Tribunal des conflits drew a line between a category of
cases falling under the jurisdiction of civil courts and another category falling
under the jurisdiction of administrative courts. Interestingly, however, the
Tribunal des conflits confirmed that most cases involving a “moral person of
French public law” fall under the jurisdiction of civil courts. The exception that
the Tribunal des conflits carved out in favour of administrative courts has a
very narrow scope.
Notwithstanding all this, several practitioners of international arbitration
very forcefully attacked the decision of the Tribunal des conflits. Their arguments
are very much consistent with those advanced against Mitchell v. DRC. In short,
they accused the Tribunal des conflits of complexifying the legal regime of
international arbitration in ways that would undermine the pre-eminence of
France as a place of arbitration. Again, the core of the argument is directed
towards the preservation of international arbitration as a system. The words
used by these practitioners are telling: “French masochism”, “a very hard blow”,
“the worst of evils”, “anachronistic and unreasonable”, “byzantine contortions”
and so on. One of the judges involved in this case told me that they had never
faced comparable backlash in any of the sensitive cases that they had decided
in their (long) career.
More than ten years after the decision of the Tribunal des conflits, the data
does not support the critiques formulated at the time. There is no conclusive
evidence that the proportion of international arbitration cases held in France
has declined because of this decision. ICC statistics show that, in 2010, 15.6%
of its cases were decided in France. This proportion decreased slightly in 2020
(12.2%), but nothing on the scale anticipated by the critiques of Inserm v.
Foundation Letten F. Saustad. Additionally, in the very few cases where they
have been seized, French administrative courts seem rather reluctant to annul
arbitral awards (I could identify only one such case in more than ten years).
What seems problematic for the guardians of international arbitration is the
perception from others that “their” system can be improved when it works so
well for them.
I could multiply the examples, for instance, by referencing the trench warfare
between the proponents of arbitration and EU institutions. This warfare has led
to an extremely bizarre comparison between EU policies and the attitude of the
Nazi regime towards arbitration, a comparison that is indeed “anachronistic and
unreasonable”. It has also led to a denunciation of the “manic authoritarianism”
of the CJEU, a strange comparison for anyone who has experienced actual
authoritarianism. The prophets of international arbitration do not like their
system being challenged in the name of the public interest. However, their
prophecy of decline might become self-fulfilling if they refuse to assess the
virtues and shortcomings of international arbitration in light of broader societal
values. In this important debate, Professor Bermann’s open-mindedness and call
for a broader dialogue do honour to the legal profession.
Chapter 44
COMPARING ARBITRATION TO JUDICIAL
LITIGATION: ASSETS AND CHALLENGES
Freya Baetens*
I. INTRODUCTION
In the first weeks of my LL.M. studies at Columbia University, our class

received two invitations from George Bermann: the first was for interested
students to step forward to serve on the editorial board of the Columbia Journal
of European Law; the second to apply for a position as Professor Bermann’s
research assistant. Freshly arrived from law school in Europe, excited not only
to study at Columbia but also to live in New York, I eagerly accepted both
invitations—and was so fortunate as to be selected for both positions.
Little did I realise that the opportunities offered to me by Professor Bermann
would set me on a course for life. As an editorial board member, I learned how
a scholarly journal functions, I then pursued this, among other, as the co-
editor-in-chief of the Law & Practice of International Courts and Tribunals. As
his research assistant, I helped him prepare for his summer lectures at the
Academy of European Law at the European University Institute in Florence.
This was the best possible preparation for my own lecturing career later on.
George Bermann was not only a mentor for me, he is a role model, one of those
giants in the field who manage to be inspiring professors as well as outstanding
practitioners, while remaining kind to all and generous with their time towards
students in particular.
It is therefore an honour and a pleasure for me to contribute to this book
reflecting on George Bermann’s legacy.
In his 2018 article about the meaning of “pro-arbitration” (published in
Arbitration International), Professor Bermann notes that “the international
arbitration community must strive to ensure that, in addressing the concerns
and pursuing the values most closely associated with arbitration practice and
its efficacy, it does not fall seriously out of step with extrinsic values to which
the legal system as a whole attaches fundamental importance” (p. 342). Indeed,
* Freya Baetens (Cand. Jur./ Lic.Jur. (Ghent); LL.M. (Columbia); Ph.D. (Cambridge)) is
Professor of Public International Law (Faculty of Law, Oxford University) and Head of
Programmes at the Bonavero Institute of Human Rights and Fellow at Mansfield College. She is
also affiliated with the PluriCourts Centre (Faculty of Law, Oslo University) and the Europa
Institute (Faculty of Law, Leiden University). As a Member of the Brussels Bar, she regularly acts
as counsel or expert in international and European disputes. This work was partly supported by
the Research Council of Norway through its Centres of Excellence funding scheme (project
number 223274) and the FRIPRO Young Research Talents (project number 274946).
251
the arbitration system has its pros and cons, some of which are borne from
underlying tensions between different values at stake.
Arbitration is a broad field, covering domestic arbitration, international
commercial arbitration, investor-State arbitration, ad hoc arbitration and State-
to-State arbitration, among others. Professor Bermann focuses on international
commercial arbitration in his article. In this brief note comparing arbitration
with judicial litigation, I will also refer to other types of arbitration, considering
the different facets that may prove assets in some cases and challenges in others.
It is possible, for example, that an aspect which is positively regarded in domestic
or international commercial arbitration, such as complete confidentiality of the
proceedings and the outcome, may be viewed negatively in another context,
such as investor-State or State-to-State arbitration.
II. CAN ARBITRATION BE SUPERIOR TO JUDICIAL LITIGATION?
Arbitration, at its best, can be a superior alternative to judicial litigation.

Such superiority would result from arbitration’s ability to provide a better (in
the sense of efficient, effective and acceptable) solution to a dispute, in turn
resulting in higher compliance with the arbitral decision by the disputing
parties. Arbitration’s efficacy is influenced by the attitudes of domestic courts
and legislatures to ensure that arbitration agreements are respected and
awards are recognized and enforced. Thus, arbitration’s superiority depends
upon its efficient interplay with such courts and legislatures and their acceptance
of arbitration as a valid dispute resolution mechanism.
Pro-arbitration advocates will need to consider extrinsic values or
characteristics, should they wish to advance arbitration’s position as a potentially
superior alternative to judicial litigation. These characteristics include: party
autonomy, which encompasses flexible procedural rules that can provide
faster and cheaper solutions; the possibility of mixed multi-party procedures
(States, individuals, companies, NGOs, international and regional organisations);
and worldwide enforceability. In accordance with Professor Berman’s article,
would a practice or policy forwarding these characteristics be considered pro-
arbitration? That would depend on a multiplicity of metrics.
A. Party Autonomy
Party autonomy affects different areas of the arbitration, the forum for the
settlement of the dispute, the choice of the adjudicators, and the procedural
rules, among others. The assumption is that the parties will have increased
trust in the specialist competence of the adjudicators (as they were chosen by
the parties themselves), that the procedure may provide faster and cheaper
solutions (as the parties choose their procedural rules), and that the award
should be enforceable in a broad range of States (as the parties may choose the
forum for the arbitration).
COMPARING ARBITRATION TO JUDICIAL LITIGATION: ASSETS AND CHALLENGES 253
B. Mixed Multi-Party Procedures
An arbitration proceeding allows for disputes between mixed parties to be

resolved on equal footing: States, individuals, companies, NGOs, international
organisations and regional organisations such as the EU may participate in
arbitration proceedings, if they so agree. Multi-party disputes where groups of
mixed parties seek to see their dispute resolved, also form part of arbitral
possibilities. This would not appear to generate tension with a value extrinsic
to arbitration, save where issues of State immunity might be at issue. When a
State accepts an arbitral forum for dispute resolution, it does so expressly and
waives any jurisdictional immunity. Where an arbitration allows for a dispute
between a State and a company to be resolved, it has the benefit of the dispute
being able to be resolved quickly and by an independent tribunal, but at the
same time, the involvement of a State may require increased transparency.
C. Worldwide Enforcement
With the ubiquitous ratification of the 1958 New York Convention on the
Recognition and Enforcement of Foreign Arbitral Awards the procedure for
recognition and enforcement of (foreign) arbitral awards has become relatively
uniform and transparent. Recognition and enforcement of arbitral awards may
only be refused, in the countries that ratified the New York Convention (169
States) on the basis of the limited grounds (e.g., absence of an agreement to
arbitrate) explicitly set out in Article V.
Arbitral awards rendered under the auspices of the International Centre
for the Settlement of Investment Disputes (ICSID) Convention, must be recognized
as binding and enforced “as if it were a final judgement of a court in that State”
(Art. 54). This means that parties to a dispute will, in all likelihood, have a
predictable procedure to enforce the award in whichever jurisdiction the losing
party has assets. Once the award is issued, it will be easier for the triumphant
party to seek compliance, than would be the case if a domestic court judgement
needed to be recognised and enforced by the courts of another country. A
relatively straightforward enforcement procedure does not appear to be in
tension with values external to the arbitration community, with a caveat
relating to appellate procedures, referred to below.
III. CAN ARBITRATION BE INFERIOR TO JUDICIAL LITIGATION?
Simultaneously, one cannot ignore the possible downsides of arbitration, or

the elements of arbitration which could make it seem inferior to judicial
litigation. These include: lack of transparency; the panoply of procedural options
which can lead to drawn-out procedural battles, increasing costs; and the
characteristic finality resulting in a lack of options to appeal a decision. In some
cases, these “anti-arbitration” elements may negatively affect arbitration’s
legitimacy, while in others they affect the characteristics which make arbitration
attractive.
A. Transparency
Commercial arbitrations have a tendency to lack transparency: this has

historically been considered an asset by commercial entities, as it allows them
to keep their disputes confidential. However, this also affects the legitimacy of
arbitration as it may have two-fold negative consequences: first, decisions may
well be contradictory if arbitrators do not have access to precedents which
might be relevant to their decisions, even if they are not binding. Second,
where a matter of public interest is at stake, the lack of transparency is used
by arbitration’s critics to question its legitimacy.
Ongoing debates within the arbitration community concerning public
interest matters, for example, demonstrate the community’s ability to look
beyond arbitration itself and acknowledge considerations of legitimacy. There
has been a push for more transparency in arbitration particularly in the investor-
State context, for example with the Mauritius Convention on Transparency and
the EU-Canada Comprehensive Economic and Trade Agreement (CETA).
However, it must also be acknowledged that the effect of these two agreements
is very limited, the Mauritius Convention (signed in 2015) has only been ratified
by nine States, and the dispute settlement provisions of the CETA investment
chapter have not entered into force. Additionally, neither of these agreements
would have effects in commercial or domestic arbitration, which form the vast
majority of arbitral cases.
B. Procedural Complexity
Arbitral tribunals have to balance their obligation to proceed with speed

and economy, with an obligation to avoid annulment or setting aside procedures
on due process grounds. At times, autonomy allows parties to create procedural
complexities which, arguably at times needlessly, prolong the dispute resolution
process. However, even the fact that a party may choose to generate procedural
hurdles to resolve a dispute, which may lengthen the process and make it more
expensive, could arguably be viewed as a benefit in light of due process
guarantees. That a party may abuse that possibility is also a reality, much as it
is in judicial litigation, but one cannot conclude that arbitration is a worse form
of dispute settlement on this basis.
C. Finality
Arbitration is traditionally considered a one-stop-shop: an arbitral award

once rendered, is final. Finality has also been considered a “pro-arbitration”
characteristic. However, this is in tension with the lack of an appeals process.
Most judicial systems consider that an essential element of due process is the
COMPARING ARBITRATION TO JUDICIAL LITIGATION: ASSETS AND CHALLENGES 255
two-stage dispute settlement proceeding, i.e. that every first-instance decision

can be reviewed by a separate, independent and impartial appellate body. In
arbitration, any such review is restricted to either an annulment proceeding
within the ICSID system, or the limited grounds for refusal of recognition and
enforcement enumerated in Article V of the New York Convention. Occasionally,
it may be possible to rely on optional appellate rules, such as those of the American
Arbitration Association. A party which considers that an award has been in
error does not have any mechanism to appeal the merits of the decision, this is
a trade-off with values that are extrinsic to the arbitration procedure.
IV. REFORM POSSIBILITIES
Of course, one must not throw out the baby with the bathwater, and reform is
constantly being discussed in arbitration. In the above-mentioned article (p. 352),
Professor Bermann argues that advocates of arbitration ought to consider
values external to it but which would enhance its legitimacy overall. In much
the same vein, arbitral reform should consider those values. It should increase
participation by interested actors, augment transparency of arbitral awards,
hearings and submissions, reform the role of arbitral institutions, consider
creating an appellate review option, but also take more practical steps like
decreasing costs where possible.
It would be wise to consider consulting agents external to the arbitral world
but which are affected by it, in this reform process, for example, through the
participation of trade unions, NGOs and industry federations. One might also
contemplate whether these agents should participate in arbitral proceedings
as amicus curiae or intervening parties, provided they have a substantial addition
to make and carry the costs incurred by their participation. The incorporation
of voices critical to arbitration would allow the institution to address and ease
the concerns of these entities, thus improving its legitimacy and effectiveness.
Another, perhaps less controversial, element to improve arbitration’s
legitimacy would be to increase its transparency as it would allow third parties
access to understanding the process and its results. In cases that are of particular
public interest, transparency in hearings and submissions (possibly redacted)
would allow third parties to know what exactly is being argued by States and
investors. More importantly: awards of particular public interest should be
made public. This will enhance arbitration’s legitimacy because it would
contribute to predictability of results. Even if awards do not have precedential
value, they can still guide other arbitral tribunals in deciding on a similar topic.
Similarly, transparency may avoid direct contradictions, as contradictory awards
make the process seem inconsistent and unpredictable. Though States have
taken steps in this sense, for example through the Mauritius Convention
mentioned above, more could be done.
Insofar as the lack of an appellate review process is concerned, within the
context of investor-State arbitration, the EU is currently proposing to reform
treaties so as to encompass an appellate mechanism, but no such procedures

have taken place as of yet. Nor is such an addition to the dispute settlement
process universally welcomed by all States.
Reforms could also clarify the role played by arbitral institutions. The
participation of tribunal secretaries in arbitral proceedings ought to be better
explained, for example in reference to the function of law clerks in international
and domestic courts. They may contribute to the drafting process but ultimately,
all credit or blame for the award lies solely with the people whose signature is
appended at the end of it, namely the tribunal members themselves. In addition,
institutions choose arbitrators and decide on challenges to arbitrators, two
essential issues in relation to arbitration’s legitimacy and both currently lack
transparency in the process.
Finally, on a more practical note, proposals should be put forward to limit
the costs of arbitration. Though the greatest expense in arbitral proceedings are
the costs of counsel (and therefore in the hands of each party itself), advantage
could be taken of the many technological advances so as to reduce tribunal costs
through the use of technology. For example, arbitral tribunals could default to
video hearings (particularly for procedural meetings) and electronic filings,
save where circumstances warrant physical presence or hard copies.
V. CONCLUSION
In the above-mentioned article, Professor Bermann outlines four “goals” of

international arbitration, drawing from Professor Park’s analysis: “accuracy,
fairness, and efficiency and an enforceable award” (p. 342–3). He then
disaggregates these into twelve non-exhaustive criteria, which may at times be
contradictory and even challenge considerations that are of considerable
social value or utility. A multiplicity of metrics and values allow us to identify
the prevalence and dependency of arbitration in relation to judicial litigation.
In this context, a measure that improves the legitimacy of arbitration, even
when it negatively affects a characteristic perceived as positive for arbitration,
should nevertheless be considered “pro-arbitration”.
Arbitration’s efficacy depends on the attitudes of courts and legislatures to
ensure that arbitration agreements are respected and awards are recognized
and enforced. In light of this dependence, pro-arbitration positions should
consider values that are not in themselves intrinsic to arbitration. For arbitration
to consolidate its superiority to judicial litigation, reform must contemplate
the extrinsic societal values that are fundamental to dispute settlement, such
as incorporating other interested or affected actors in the reform and/or dispute
settlement process, considering appeal possibilities, providing more clarity on
the role of arbitral institutions, and increasing transparency while lowering cost.
Chapter 45
“PRO-ARBITRATION”: THE NECESSARY PRESENCE
OF COURTS AT THE END OF THE ROAD
Gino Rivas*
I. INTRODUCTION
My studies at Columbia Law School allowed me to meet and learn from the
best arbitration scholars and practitioners. Among them, the key figure was
Professor Bermann, one of the most prominent figures in the international
arbitration community. As his student and research assistant, I experienced his
enthusiasm to assist, advise and teach; this was not only restricted to arbitration
issues but transcended legal matters. I also had the opportunity to understand
how he sees arbitration. Professor Bermann has not only an exhaustive
knowledge of arbitration, but over and above that he has a clear sight of its role
as an ADR method, its challenges and the main dangers against it.
As Professor Bermann argued in his well-known article on the meaning of
“Pro-Arbitration”, the efficacy of arbitration depends not only on the attitude
of its users, but also of the courts. Indeed, for arbitration court review is one of
the most important factors. In this essay, I focus on the annulment of awards.
The availability of annulment proceedings is essential to ensure the legitimacy
of the award. A system that excludes these court proceedings is not sustainable.
In addition, a system that allows parties to exclude certain grounds via agreement
would have unpredictable results, as there is a clear overlap between “disposable”
grounds and “non-disposable” grounds.
II. ABSOLUTE NON-AVAILABILITY OF ANNULMENT PROCEEDINGS:

NOT REALLY PRO-ARBITRATION
A national legal framework could regulate annulment proceedings in different

ways. Comparative law shows that the starting point, the implementation
(existence) or exclusion (absence) of annulment court proceedings, can vary
from country to country. Manuel de Lorenzo, La renuncia anticipada a la
impugnación del laudo, 27 Spain Arbitration Rev. 95, 97 (2016). Be that as it
may, lawmakers have three main options: (i) not implementing a judicial
means to annul awards and prohibiting parties to generate this judicial channel
through an agreement; (ii) letting parties decide if there will be a judicial
means to annul the award—and within this option, allowing (or not) parties to
* Gino Rivas is a Professor at the Pontificia Universidad Católica del Perú and a Columbia
LL.M. Graduate.
257
decide which grounds will be available; (iii) or implementing a mandatorily

available judicial means to annul an award, that parties cannot regulate or waive.
The majority of jurisdictions have chosen the last option although several
prominent countries have opted for the second. The first question to address
would be why the first option is hardly chosen. At first glance, the absolute
non-availability of annulment proceedings could be considered pro-arbitration.
The reason? Enforceability of the award would increase as under no
circumstances that award would be annulled. Thus, the efficacy of arbitration
would be enhanced.
Historically, one country chose the first option. In 1985, Belgium modified
its Code Judiciaire to establish that annulment proceedings would not be available
for arbitration cases between non-Belgian parties. The decision was made in
order to increase Belgium’s importance as a seat of arbitration cases and to
reduce the number of “unnecessary” cases addressed by the courts—that is,
efficiency (and efficacy). J. M. Nelissen Grade, The Annulment of Arbitral Awards
in Belgium, 5(11) Int’l Fin. L. Rev. 35, 35 (1986). Theoretically, this measure
should have made Belgium a “paradise” for arbitration. Marcel Storme, Belgium:
A Paradise for International Commercial Arbitration, 14(8) Int’l Bus. Lawyer
294, 295 (1986).
Nonetheless, the experiment failed. Few parties were enthusiastic about
not having any ex-post court review at all. It is reasonable to consider that
many litigators would like, to a great or lesser extent, some way that allows them
to request the annulment of the award. Then, practitioners would be discouraged
to choose a seat that lacks that kind of judicial review—a review that could
lead to the annulment of the award. Hossein Abedian, Judicial Review of Arbitral
Awards in International Arbitration. A Case for an Efficient System of Judicial
Review, 28(6) J. of Int’l Arbitration 589, 600 (2011). In addition, it could be argued
that the inexistence of a judicial means to annul awards would transgress the
fundamental right of access to courts and the procurement of effective judicial
protection. Faustino Cordón Moreno, El Arbitraje de Derecho Privado: Estudio
Breve de la Ley 60/2003, de 23 de Diciembre, de Arbitraje 258 (2005).
Ultimately, Belgium returned to the classic rule of availability of annulment
proceedings. Belgium’s experience demonstrates that prioritizing efficacy
could damage the very existence and development of arbitration as an institution.
As Professor Bermann clearly states, a policy could be considered pro-arbitration
under one criterion, but actually could be negative to arbitration under other
criteria, and thus could actually be not pro-arbitration at all.
III. ALLOWING PARTIES TO EXCLUDE ANNULMENT PROCEEDINGS:

LEGALLY UNFEASIBLE
Realistically, the absolute non-availability of annulment proceedings is not

an option. A more nuanced option is surely needed. Therefore, it could be argued
“PRO-ARBITRATION”: THE NECESSARY PRESENCE OF COURTS 259
that parties should be able to decide if they want to have a judicial recourse
available (or to what extent).
It is sound to consider that this is a more solid option as compared to the
previous one. In this case, parties’ freedom is recognized, protected and
prioritized. Precisely, in Tabbane v. Switzerland, the European Court of Human
Rights analyzed article 192 of the Federal Act on Private International Law, a
provision that allows parties to exclude the judicial means to annul awards.
The court considered that the referred provision was just an open possibility
for the parties and that strengthens party autonomy. ECtHR, Tabbane v.
Switzerland, application 41069/12, decision of March 1, 2016, § 34.
In any case, regarding the availability of annulment proceedings, it is
important to distinguish between cases where total freedom is granted and those
where only partial freedom is given. Excluding judicial means in their entirety
and only excluding certain grounds are not the same. Bernardo Cremades Sanz
Pastor & Alicia Martín Blanco, El pacto de renuncia o de ampliación de los motivos
de la acción de anulación del laudo arbitral internacional en España, 3 Spain
Arbitration Rev. 5, 8 (2008).
Thus, we can call “pure” systems to those where parties have total freedom,
to the point that they can completely exclude annulment proceedings This is
the case of France (Code de procédure civile, art. 1522), Russia (Russian
International Commercial Arbitration Act, art. 34.1). In both countries, however,
this is only true for international arbitration. Other countries that follow this
standard are Switzerland (Federal Act on Private International Law, art. 192),
Belgium (Code Judiciaire, art. 1717), Colombia (Law 1563/2012, art. 107) and
Peru (Peruvian Arbitration Act, art. 63.8). In these countries, only when both
parties have no material connection with the seat. By contrast, “hybrid” systems
are those where parties cannot completely exclude annulment proceedings
but can alter the scope of judicial review. This is the case of Sweden (Sweden
Arbitration Act (1999), s. 51) and Germany (The ZPO does not expressly
recognize this. Nonetheless, it is reported that case law does recognize the
viability of parties’ agreement to reduce the scope of judicial review, except on
grounds of non-arbitrability and the transgression of public policy. Stefan
Michael Kröll & Peter Kraft, Chapter VII: Recourse against the Award, § 1059 –
Application for Setting Aside, in P. Nacimiento, S. Kröll & K. Böckstiegel (eds.),
Arbitration in Germany: The Model Law in Practice 383, 387 (2d ed. 2015)).
“Pure” systems, in my opinion, are not legally valid. Allowing parties to
completely suppress judicial means to annul awards should not be possible. It
would be detrimental to both arbitration and to the legal system more broadly.
As Kerr noted about England—but applicable to any jurisdiction—there cannot
be a body, entity, or tribunal that can issue legally binding decisions while also
being completely immune to court review. Michael Kerr, Arbitration and the
Courts: The UNCITRAL Model Law, 34(1) The Int’l and Comparative L. Quarterly 1,
15-16 (1985). In fact, complete exclusion of court review could be severely
detrimental for the legitimacy of arbitration. Society would wonder why this
method of dispute resolution deserves unique treatment which could lead to a

negative perception of arbitration.
Regarding arbitration, two grounds for annulment should always be available:
Violation of Public Policy and Non-arbitrability. There is a clear reason why
these grounds can be addressed ex officio by the courts. The total suppression
of the judicial means to annul awards would allow awards that violate public
interest to exist without any way to revert them. As we know, the grounds of
non-arbitrability and public policy do not protect only parties’ interests, but
also interest of the society as a whole. Precisely, in Sweden, where parties cannot
exclude those grounds, the reason is that those grounds protect the public
interest and the interest of third persons. Annette Magnusson, National report
for Sweden (2020), in L. Bosman (ed.), ICCA International Handbook on
Commercial Arbitration 1, 29 (Supplement 110, 2020).
At this point, one could wonder why prominent arbitration venues such as
France and Switzerland chose a “pure” system. It happens that, in those countries,
if parties choose to completely exclude annulment proceedings, then the
resulting award would be subject to recognition and enforcement under the
New York Convention. In effect, court review is not being actually excluded,
just transferred from “annulling” courts to “enforcing” courts. For arbitration,
court review of public policy and arbitrability is a matter of legitimacy.
IV. ALLOWING PARTIES TO EXCLUDE CERTAIN GROUNDS OF

ANNULMENT: PROBLEMATIC AND THUS INEFFICIENT
As we have seen, it is sound to rule out a system that completely excludes

annulment proceedings, either by legislative decision or parties’ agreement.
Thus, as opposed to the classic scheme of mandatory and “untouchable”
annulment proceedings, only one option is left: a “hybrid” system that allows
parties to narrow (not to exclude) judicial review.
In this system, the judicial means to annul awards mandatorily exists, and
grounds for annulment that protect the public interest (non-arbitrability and
public policy) remain unassailable. Parties would be free to exclude the
remaining grounds. For example, under the UNCITRAL Model Law, parties
would be able to exclude each and all grounds of article 34(2)(a): defective
arbitration agreement, due process, excess of authority, and non-compliance
with party-agreed rules on procedure.
There are problems regarding the exclusion of those grounds (with the
exception of excess of authority).
First, regarding the arbitration agreement, there does not seem to be a
reason to prevent parties from excluding the ground of challenging the validity
of the arbitration agreement. If parties can tacitly waive the referred ground,
there should not be a reason to prohibit express agreements in that sense.
Bernardo Cremades Sanz Pastor & Alicia Martín Blanco, El pacto de renuncia o
de ampliación de los motivos de la acción de anulación del laudo arbitral

internacional en España, 3 Spain Arbitration Rev. 5, 11 (2008).
Naturally, courts would be able to review the validity of this exclusion
agreement. Otherwise, there would be a space for illegal acts without judicial
review. If the arbitration agreement cannot be reviewed at all, and if the
exclusion agreement is part of the arbitration agreement, then the entire pact
cannot be reviewed. As a result, any person could forge an arbitration agreement
with an exclusion agreement—that excludes the ground of defective arbitration
clause—and initiate arbitration proceedings. Affected parties would not be
able to challenge the arbitration clause or the exclusion agreement and would
be defenseless against illegal arbitration proceedings.
Thus, it would not be possible to allow a complete exclusion of the ground
about the validity of the arbitration agreement. The ground should always be
open when the challenge is against the exclusion agreement and this agreement
integrates the arbitration clause. In particular, the affected party should have
the opportunity to prove that its consent to that agreement is defective. Nora
Krausz, Waiver of Appeal to the Swiss Federal Tribunal: Recent Evolution of the
Case Law and Compatibility with ECHR, Article 6, 28(2) J. of Int’l Arbitration
137, 150 (2011).
In principle, this judicial review would be limited to the exclusion agreement.
In practice, however, it could cover the (complete) arbitration agreement. In
certain cases, when the arbitration clause and the exclusion agreement are
located in the same document, the invalidity of the exclusion agreement could
mean necessarily the nullity of the arbitration clause. For example, if a document
that contains the exclusion agreement is forged (falsified signatures) and it
also actually contains the arbitration clause, then this clause should also be
declared invalid.
In practice, there will always be some level of review to an arbitration
agreement even if parties agree to exclude this ground of annulment. It is
simply impossible to completely exclude court review of parties’ consent to
arbitration.
Second, we have the ground of due process. In theory, there is no reason to
deny parties the possibility to agree to exclude the ground of due process.
Nevertheless, the proximity of the concepts of due process and public policy
could cause significant problems. It is obvious to say that public policy has a
procedural dimension. Therefore, transgressions to procedural public policy
are particularly severe transgressions to due process. Thus, there is an overlap
between the ground of due process and the ground of public policy. Patricia
Nacimiento, Article V(1)(d), in H. Kronke et al., Recognition and Enforcement of
Foreign Arbitral Awards: A Global Commentary on the New York Convention
281, 282 (2010) (referring to the overlap between V(1)(b) and V(2)(b) of the
New York Convention). This means that any case of transgression of due
process that at the same time goes against procedural public policy could not
be covered by an exclusion agreement.
The problem is that there is no way to determine which procedural defects

transgress due process but do not affect procedural public policy. This erodes
the predictability of an agreement that excludes the ground of due process.
As a result, parties cannot completely exclude this ground. They could only
exclude judicial review on defects that transgress due process but do not violate
procedural public policy. Still, this fact challenges the utility of excluding this
ground. Where would we draw the line between transgressions to just the
ground of due process and transgressions that overlap and are covered by both
the due process ground and the (procedural) public policy ground?
In the third place, we have the ground of distortions in the composition of
the tribunal or in the arbitration proceedings. The problem here is that this
ground overlaps with the ground of due process. Thus, this ground could also
cover cases that at the same time can represent a violation of procedural public
policy. Once again, there would be a problem determining if a case is only
covered by the ground of non-compliance of party-agreed rules or if actually
the case results in a transgression to procedural public policy.
At the end, who would decide these matters? Courts, and this would be
ironic considering that by excluding grounds for annulment parties wanted to
avoid courts. The main problem, however, is unpredictability. Even courts that
have experience analyzing arbitration awards would have trouble establishing
criteria to identify procedural violations that do not reach the threshold of
procedural public policy. Actually, this is a problem that goes beyond the
courts—any user or body would have the same difficulty as the tasks are
complex and involve a high level of discretionary power.
V. CONCLUSION
As Professor Bermann has noted, if a policy boosts arbitration’s legitimacy,

it may be considered “pro-arbitration” even if it invites judicial intervention.
This is the case for annulment proceedings—or, strictly speaking, court review,
whether by annulment or enforcement proceedings—they are necessary to
maintain the legitimacy of arbitration.
A jurisdiction can choose between three main options: completely excluding
annulment proceedings, allowing parties to (partially or totally) exclude grounds
for annulment, and establishing mandatorily available annulment proceedings.
While the first option looks good on paper, in reality, it significantly damages
arbitration’s legitimacy. Parties generally want some level of court review and
practitioners, users, and citizens would be unhappy if arbitration received a
unique treatment (“immunity”).
The second choice is a more nuanced option. This is because here parties
would be the ones called to decide whether they want annulment proceedings
available or not. Nevertheless, total exclusion of annulment proceedings
cannot be allowed, as there are grounds for annulment that involve a public
interest. These grounds, non-arbitrability and violation of public policy, should

always be available.
Ultimately, only the exclusion, by parties, of certain grounds of annulment
would be a legally feasible option. These would be the grounds of defective
arbitration agreement, due process, excess of authority and non-compliance
with party-agreed rules. Even so, it is difficult to draw a line between cases that
can be excluded and those that cannot. Regarding arbitration agreements,
courts should be allowed to assess the validity of the exclusion pact—the pact
by which parties exclude grounds of annulment. This, when the exclusion
agreement is a part of the arbitration agreement, would result in reviewing the
arbitration agreement. Regarding due process and non-compliance with party-
agreed rules, the problem is that there may be overlapping with the ground of
public policy, as it includes procedural public policy.
In summary, this final more nuanced proposal would have a minimal
impact regarding the extension of court review. But at the same time, it would
generate unpredictability, potentially harming arbitration’s legitimacy. Although
mandatorily available annulment is a form of judicial intervention, and it does
not boost party autonomy, it is sound to consider that arguing for mandatorily
available annulment proceedings is, after all, being pro-arbitration.
Chapter 46
AWARDS AND PEACE: ARBITRATION OF
INTERNATIONAL CONFLICTS
Guled Yusuf and Andrew Hashim*
The promise of arbitration in achieving peace and resolving conflicts

between persons, nations and civilizations is not a novel, nor is it an untested
phenomenon. Its use stretches back millennia where, long before courts and
similar institutions were established, people turned to arbitration as a dispute
resolution mechanism. An early record and example of an arbitration arises
from the account of King Solomon’s resolution of a dispute between two young
women who had submitted their dispute for resolution by the King. The story
goes that both women lived in the same house and gave birth to children
within days of each other. On one fateful night when, it was agreed by both
parties, no other person was in the house, one of the women accidentally
smothered her child while sleeping. The petitioning woman claimed that the
accused woman smothered her own child and, upon realizing her horrendous
mistake, had exchanged her then-deceased child with the other woman’s child
while the other was sleeping. The accused woman denied this and both
claimed that the living child was theirs.
After listening to both women’s arguments, and after deliberating, the King
called for his sword to render his award. He declared that the only fair solution
would be for him to cut the living child in half so that both women could have
one-half of the child. Upon hearing this award, the true mother of the living
child exclaimed “[o]h, my lord, give her the living child, and by no means kill
him!” However, the other said “[h]e shall be neither mine nor yours; divide him!”
Following the interjections of both women, the King recognized the woman
willing to surrender the child as the true mother. His wisdom and good
judgment indicated that a true and loving mother would rather surrender her
child than see the child done harm.
King Solomon’s example is only one of many showing arbitration’s use
throughout history to resolve differences (Frank D. Emerson, History of
Arbitration Practice and Law, 19 CLEV. St. L. REV. 155 (1970)). In the sphere
of international arbitration to resolve diplomatic disputes, the ancient world
* Guled Yusuf is a Partner in Allen & Overy’s International Arbitration Group. He is admitted
in New York as well as in England and Wales. Andrew Hashim is an Associate in Allen & Overy’s
International Arbitration Group. He is admitted in New York, Massachusetts, and England and
Wales. The views and opinions expressed in this essay are those of the authors and do not
necessarily reflect the views of the law firm with which they are associated or any clients of the
firm.
265
also utilized this form of dispute resolution in order to solve international

disputes without the need to resort to war. For instance, around 600 BC, a
dispute arose between Athens and Megara over the possession of the island of
Salamis. The matter was referred to a panel of five Spartan arbitrators who held
that the islands would be given to Athens. Furthermore, there were instances
where a larger state compelled smaller powers to arbitrate their differences.
This was true occasionally during the Roman Empire where the Romans took
over the Hellenic practice of utilizing arbitration to adjudicate differences
between the states within their sphere of influence.
All of this is to say that the use of arbitration to resolve international
differences is neither a new phenomenon nor is it untried and untested. It
continues to be, and should remain, an important tool to resolve diplomatic
crises peacefully. The beginnings of the modern conception of international
arbitration are largely attributed to the Jay Treaty between the United States
and Great Britain. Treaty negotiations were undertaken due to concerns on both
sides that the accumulating disputes between Great Britain and the United States
would, if not assuaged, in due course lead to war. Signed on 19 November 1794,
Articles 5, 6 and 7 of the Jay Treaty provided for various modes of arbitral
settlement of disputes. The issues to be resolved by arbitration included: the
northeast boundary of the United States, disputes over wartime debts, claims
of British merchants who sought compensation for breach of lawful contracts
with U.S. citizens and claims by U.S. citizens over illegally seized ships by Great
Britain. Articles 6 and 7, more specifically, provided for the establishment of a
five-member arbitration panel with two members appointed by the President
of the United States (with advice and consent of the U.S. Senate) and two members
appointed by the King of England. The four appointed commissioners (or
arbitrators) would agree upon the final member. In the event of no mutual
agreement, each side would propose a nominee with the final selection made
by drawing lots in the presence of the other commissioners. Commissioners
swore to decide their cases “in accordance with justice and equity”. The
commission was able to operate with the presence of only three members as
long as one of the members appointed by each the United States and Great
Britain was present along with the mutually appointed member.
Importantly, the Jay Treaty’s use of arbitration to settle diplomatic differences
paved the way for modern uses of arbitration to achieve the same goals.
Furthermore, the Jay Treaty’s dispute resolution mechanisms and tribunal
constitution procedures largely mirror the constitution of modern international
arbitral tribunals (see below specifically for the Eritrea-Ethiopia Boundary and
Claims Commissions). As a result of the Jay Treaty’s arbitration provisions,
several important issues were sent to, and finally resolved by, arbitration. For
instance, Great Britain paid $10,650,000 for damages to American shipping
and received £600,000 for unpaid pre-US Revolutionary War debts from the
United States.
AWARDS AND PEACE: ARBITRATION OF INTERNATIONAL CONFLICTS 267
It did not take long after for arbitration to be used again in the settlement
of a border dispute, this time off the coasts of the Middle East and East Africa.
In 1730, Oman annexed Zanzibar and many East African coastal towns to its
empire (in what is modern day Tanzania). Over 100 years later, the Omani Sultan,
Sayyid Said, established his residence in Zanzibar and in 1840 made Zanzibar
the capital of the Omani empire. At the Sultan’s death in 1856, a succession
dispute erupted between his surviving sons, Thuwaini bin Said and Majid bin
Said. At the urging of the British Government, and instead of waging war to
resolve their differences, the brothers signed a compromis to resolve the
dispute through arbitration. To this end, Earl Canning, Viceroy of India, was
appointed as arbitrator to render an award over the control of the Omani
territories in East Africa.
Earl Canning then sent an officer, Brigadier Coghlan, on a fact-finding
mission to both Muscat and Zanzibar. In recognition of the report submitted
by Brigadier Coghlan, Earl Canning issued an arbitral award (also known as
the “Canning Award”). In essence, the award established Zanzibar as an
independent and separate sultanate under the Sultan of Zanzibar, Majid bin
Said, who was the late Sultan Sayyid Said’s former Governor of the East African
dominions. The award provided that the Sultan of Zanzibar would however
pay the Sultan of Oman, Thuwaini bin Said, his brother, a subsidy of 40,000
crowns per year in order to compensate Oman for the loss of its revenues from
East Africa. Furthermore, the sum of 80,000 crowns was awarded to the Sultan
of Oman, to be paid by the Sultan of Zanzibar, for the cost of being deprived of
revenues from East Africa for the two years prior to the rendering of the award.
The 80,000 crowns were considered by the arbitrator to be the arrears owed
by the Sultan of Zanzibar to the Sultan of Oman. The correspondence following
the Canning Award was positive from both sides, with the Sultan of Oman being
“highly gratified with [the] contents” of the letter and the Sultan of Zanzibar
writing that he agreed to abide by the contents of the award.
Further promise was shown in the resolution of an international border
dispute between Saudi Arabia and Yemen involving the Aaroo Mountain (which
sits on the border between the two neighbours). When a dispute erupted
between Saudi Arabia and Yemen over control of the mountain in the early
1860s, the armed forces of Yemen were sent to occupy the mountain, claiming
that they had been invited to do so by the inhabitants of the Aaroo. When
negotiations failed to settle the question of territorial sovereignty over the
mountain, the Imam Yahya (King of Yemen) telegraphed a request for arbitration
to the King of Saudi Arabia, Abdul Aziz (Ibn Saud), to finally decide the fate of
the mountain without armed conflict. The Imam of Yemen proposed that the
King of Saudi Arabia should be the sole arbitrator in the dispute, stating that
he would “leave the decision to [the King of Saudi Arabia]” trusting in his “good
sight for whatever might grace both sides and bring about harmony” between
the parties. King Abdul Aziz of Saudi Arabia accepted his appointment as sole
arbitrator and ruled that:
We have looked over the proofs advanced by the Deputies of the two
Kingdoms and have found some unexpected contradictions. Your
plenipotentiaries raise it because there is no point of doubt nor
anything akin to that. But the error of deputies can be erased by the
harmony of brotherhood. Therefore, according to your choice of Your
Brother as arbiter, and your good confidence in him, it has become my
duty to take the responsibility on me from all sides—whether from the
side of the compact between the Idrissi and ourself, or whether from
the side of the country of the Idrissi and its people and that of Nejd and
Hedjaz and Asir, who always like to fulfil their obligations and defend
their rights—and so I take this step, which I see your Presence worthy
of it—and because of love for peace among the Moslems in general
and between the two Kingdoms in particular,—and say that we
concede the Aaroo Mountain to you hoping that God may guide the
Moslems and the Arabs and the two Kingdoms to peace and tranquillity,
and we have informed our plenipotentiaries thereof. May God lead all
to do the best. (emphasis added)
In essence, the King of Saudi Arabia ruled, following a review, that in light of
the confidence placed in him by the King of Yemen, considering the contradiction
of evidence on both sides, and in an effort for peace between Muslims, he
would rule against himself and concede the mountain to Yemen. As a result of
this award, an armed conflict was averted.
Moving further into the modern era, the use of international arbitration in
resolving disputes between nations has not diminished. Two modern examples
of this involved Ethiopia; i.e., disputes between Ethiopia and Yemen and Ethiopia
and Eritrea respectively. The first of these disputes involved the State of Eritrea
(Eritrea) and the Republic of Yemen (Yemen) who both claimed sovereignty
over a group of islands in the Red Sea. Disagreements arose as to the location
of the maritime boundary between Ethiopia and Yemen and, therefore, who
held sovereignty over the islands in question. Armed conflict erupted between
the two parties over some of these islands in 1995. In an arbitration agreement
dated 3 October 1996, the parties agreed that the dispute would be submitted
and finally resolved by arbitration without resort to further armed conflict.
The agreement required the appointed arbitral tribunal to rule on the issues
of location of the maritime boundary and sovereignty in two stages.
In the first award (rendered on 9 October 1998), the tribunal found that
neither party had made a more convincing case than the other for ownership
over the islands based on ancient title (as argued by Yemen) or a succession of
titles (as argued by Eritrea). As such, after reviewing the evidence, the tribunal
decided to adopt an innovative approach. It held that there was a rebuttable
presumption that sovereignty over the respective islands lay with the state
which was most proximate (or closest) to the islands in question. Consequently,
Eritrea had sovereignty over the Mohabbakhs, the Haycocks and the South
AWARDS AND PEACE: ARBITRATION OF INTERNATIONAL CONFLICTS 269
West Rocks, due to their proximity to the Eritrean mainland. On the other
hand, Yemen would be sovereign over the Zubayr group of islands because of
the installation and maintenance of lighthouses on certain of these islands and
the inclusion of the islands in two oil production agreements that were entered
into by Yemeni private firms. Furthermore, the tribunal awarded the Zuqar-
Hanish group of islands to Yemen using a test of balance of the evidence,
reasoning that, on balance, Yemen was sovereign over the islands as it had
exercised functions of state authority over the islands in question.
In the second award (rendered on 17 December 1999), the tribunal finally
ruled on the delimitation of the maritime boundary between Eritrea and
Yemen. Even though Eritrea was not a party to the United Nations Convention
on the Law of the Sea 1982 (UNCLOS)—although it was a signatory—the tribunal
held that many rules of customary international law were incorporated into
UNCLOS and that Eritrea had further accepted the application of UNCLOS by
its reference in the arbitration agreement. In the end, the tribunal followed the
jurisprudence of the International Court of Justice and ruled that the international
maritime boundary would be a line equidistant between the coasts of the two
states. Importantly, this arbitral award was accepted by both parties, avoiding
an armed conflict, and resulting in a peaceful settlement of the border dispute.
The promise of arbitration in the modern era in resolving disputes continued
further with another arbitration involving Eritrea and another one of its
neighbours, the Federal Democratic Republic of Ethiopia (Ethiopia).
As a result of an armed conflict between Ethiopia and Eritrea, the Eritrea-
Ethiopia Boundary and Claims Commissions were formed. The outbreak of
hostilities between both countries in May 1998 was “permanently terminate[d]”
pursuant to an agreement signed in Algiers on 12 December 2000 (Algiers
Agreement). It was decided in the Algiers Agreement that the two parties
would present their cases at the Permanent Court of Arbitration to two different
commissions; a Claims Commission to decide claims for loss, damage and
injury resulting from the conflict and a Boundary Commission to establish and
demarcate the border between the two combatants. In a parallel to the Jay
Treaty’s dispute resolution framework, each of the Commissions consisted of
five members, each party appointing two members with the four party chosen
members choosing a fifth.
Both Commissions went on to make significant awards against both Eritrea
and Ethiopia. For instance, the Claims Commission held that Eritrea had
unlawfully invaded Ethiopia controlled territory at the start of the conflict.
Furthermore, it had abused or provided improper care and treatment to
Ethiopian prisoners of war, failed to provide expelled civilians with appropriate
protection and treatment and unlawfully conducted or permitted the killing,
rape or abduction of civilians and the looting of property. On the Ethiopian side,
the Claims Commission held that Ethiopia had failed to give proper treatment and
protection to Eritrean prisoners of war, engaged in looting and unlawful
destruction of property and improperly detained or expelled civilians. Many
other claims were dismissed because of various factors including lack of

jurisdiction, disagreement that the conduct alleged was itself unlawful and
failure of the party putting forward the claim to prove its claim. Other claims
alleged include the legality of methods of warfare used during the conflict and
treatment of diplomatic premises. Notably, all but one of the awards were
unanimous.
On the Boundary Commission, in its 2002 final and binding award, the
disputed territories were awarded to Eritrea, a result that for many years after
was not accepted by Ethiopia. This changed on 5 June 2018 when the new
Prime Minister of Ethiopia, Abiy Ahmed, announced that his country would
accept both the terms of the Algiers Agreement and the 2002 decision of the
Boundary Commission. While it took almost 16 years for the decision of the
Boundary Commission to be recognized by one of the parties involved in the
arbitration, its eventual acceptance demonstrates the power and legitimacy
that is conferred by an award rendered by an international arbitral tribunal.
It is a common misconception these days that arbitration is a new
phenomenon, created in a way to supplement what is considered the older,
more established and dependable court systems. A further inaccuracy is to pin
a commercial lens onto arbitrations, painting arbitration with a wide brush to
pigeon hole it as merely a tool to resolve commercial disputes. Yet, through a
reflection of the examples provided above, it becomes increasingly clear that
arbitration is neither a new phenomenon nor is it untested historically as a tool
to resolve international disputes in lieu of resorting to armed conflict. From
the Greeks and Romans of antiquity, to the Jay Treaty’s establishment of a
modern arbitration system, into the present day, the arc of history reflected in
our piece (on the contrary) shows that arbitration has been, and continues to
be, a powerful tool in the resolution of international disputes without the need
to resort to armed conflict. Consequently, the settlement of military conflicts
between states by arbitration shows the impact that this legal procedure can
have in avoiding bloodshed, instead allowing countries to settle their differences
though the force of their legal arguments rather than the force of their arms.
Chapter 47
THE ENDURING ARBITRAL LEGACY OF
PROFESSOR GEORGE BERMANN
Gustavo Laborde*
It is a happy fact of life that, occasionally, some law professors are so

brilliant, inspiring, and passionate about their craft that, unbeknownst to them,
their influence and legacy extend far beyond their academic and creative
output stricto sensu. A list of publications or a CV, howsoever extensive, simply
cannot capture and do justice to their far-reaching impression on the young
minds of legions of law students. Professor George Bermann is the quintessence
of just such a law professor.
He has inspired, trained, and shaped generations of international arbitration
lawyers—myself included—many of whom are now plying the trade at the
highest echelons of governments, law firms, multinational companies, and
universities across the globe.
There was something exotic about Prof. Bermann from the very first time
I learned about him in the mid-2000s. Here was an American law professor who
taught not just arbitration but also European Union law in the heart of New
York City, who could put on a credible French accent where the occasion
demanded it (the “Aérospatiale” case comes to mind), and whose consistent
good spirits, academic rigor, and clever use of the Socratic method conjured up
a supremely vibrant class atmosphere.
These classes cemented my interest in international arbitration from my
early law school years in New York. Prof. Bermann made it all come alive: he
conveyed the sense that arbitration was not just one of the most exciting fields
of international law one could practice (already important enough), but also that
so much remained to be made in a field still under construction. The implication
was clear: our generation would have the chance not just to practice
international arbitration, but also to shape its future. He knew how to inspire.
Teaching is undoubtedly a noble career, but for Prof. Bermann it was more
than that too—it was a calling. This showed time and again in his lectures,
brimming as much with in-depth knowledge and meticulous analysis as with
relentless enthusiasm and electric energy. He just loved what he was doing—
and it showed. The implicit message to all of us law students was simple but more
powerful than any reading material: the law is fun; international arbitration is fun.
He deployed the Socratic method with extraordinary skill, although from
the perspective of us law students this could be a frightening experience. Not
* Gustavo Laborde is a Founding Partner of Laborde Law. He has J.D. and LL.M. degrees from
Columbia Law School.

271
because he could be in any way unpleasant, far from it: even then he remained
good-natured and cut a benevolent paternal figure. But rather because the risk
of being left intellectually bruised, exposed, and metaphorically knocked out in
front of the whole class after a quick-fire exchange with him was a real one. His
academic grounding and speed on his feet were formidable—and we students
knew it all too well.
On one occasion I overheard him express concern, in a casual hallway
conversation with another faculty member, that our class that year was “not
highly participatory” (itself a token of his ever tactful, diplomatic ways). I could
not help instantly thinking to myself that the most plausible reason for this had
nothing to do with lack of engagement or interest, as he might have feared, and
all to do with a sense of intellectual self-preservation and face-saving!
Law school came and went and, eventually, I got my first job at the litigation
and international arbitration group of a Wall Street law firm. Before long, though,
the arbitration work dried out and I was staffed on New York litigation matters
that could go on for years, all in the midst of the subprime crisis that so crippled
job mobility. My dream of a career in international arbitration was in real
jeopardy—or at least so it seemed from my vantage point as a junior lawyer.
It was at this critical point that I turned to Prof. Bermann for help. This was
the first time I approached him not as a law student asking a question about the
reading assignment of the day, but as a lawyer and mentee asking for career and
life advice. We had not been in touch for a couple of years though, and I
wondered whether he would even remember who I was at all—after all, he
taught hundreds of students every year.
As it turned out, he did remember me. His advice was efficient, to the point
and, above all, bold. He also backed it up with a recommendation letter. Sometime
thereafter, I began practicing international arbitration full-time in Switzerland,
working alongside two of the finest arbitrators in the world. That advice forever
changed my career trajectory, setting it firmly on the track I had long desired.
I never looked back.
In the years that followed, I have seen Prof. Bermann speak, lecture and
present in cities like Geneva, Paris and, most recently, Edinburgh. Despite years
of legal practice, his lectures remain just as interesting and insightful as when I
was a novice law student. In fact, they become more interesting, as experience
brings about an enhanced sense of appreciation for intellectual nuance and
incisiveness.
In sum, he taught, inspired, advised, and supported me in my journey to
pursue a career in international arbitration. He did as much with countless
other law students. So, after all, what does it mean to be pro-arbitration? Prof.
Bermann’s life and career provide arguably the most meaningful and poignant
answer of all: it means preparing, training, and enabling the dreams of those
who wish to pursue a career in international arbitration. There is no greater
meaning, or legacy, than this.
Chapeau, Professeur. Nous vous remercions de tout cœur.
Chapter 48
CONFIDENTIALITY IN ARBITRATION:
IS IT “PRO-ARBITRATION”?
Jack Busby and Rebecca Collins*
When extolling the relative virtues of arbitration against litigation or other

forms of dispute resolution, confidentiality is often one of the first features
cited. The ability of parties to resolve their disputes swiftly and in private
remains a persistent description of the arbitral process. That is at least
certainly the perception. In the 2018 Queen Mary University of London (QMUL)
International Arbitration Survey, 87% of respondents (comprising private
practitioners, arbitrators, and in-house counsel) considered confidentiality to be
“of importance” in international arbitration. The importance of confidentiality
is particularly prominent among ‘users’ of the system: 46% of in-house counsel
respondents considered “confidentiality and privacy” to be among the top three
most valuable characteristics of arbitration (as per the 2018 QMUL survey).
That is no doubt why the London Court of International Arbitration (LCIA) in
its “Notes for Parties” says that “confidentiality is still generally regarded as one
of the primary underpinnings of arbitration”.
Yet the English Arbitration Act 1996 (the “Act”) contains no express
provisions on confidentiality or privacy of English-seated arbitrations. That
may change. The Law Commission of England and Wales has recently announced
a wide-ranging consultation and review of the Act, in an attempt to modernise
and enhance England and Wales as an arbitral seat. The statutory footing of
confidentiality (or lack thereof) has been suggested as a target of reform.
Given its enduring relevance to the very definition of arbitration, the potential
reform of confidentiality presents an opportunity to consider whether stronger
(or indeed weaker) rules are, in the Bermann sense, “good” for arbitration as a
whole. This essay explores what reform to the confidentiality of arbitration
under English law might look like, and leads us to consider the inevitable
question: what, if any, changes to the law on confidentiality would be considered
“pro-arbitration”?
In writing this essay, the authors are indebted to the unparalleled leadership
of Professor Bermann in driving arbitration practitioners to consider arbitral
reform through this lens. As practitioners (particularly those dedicated to
arbitration), we are conditioned to think about enhancements to the arbitral
* Jack Busby is an Associate in the international arbitration group at Allen & Overy LLP; he
has an LL.M. from Columbia Law School, where he was a student of Professor Bermann. Rebecca
Collins is a Trainee Solicitor at Allen & Overy LLP. Any and all views expressed in this essay
reflect the personal views of the authors, not the views of Allen & Overy LLP.
273
process through the grind of practice, rather than the broader systemic and
policy considerations. Professor Bermann’s scholarship continues to remind
us to “look up”.
I. CONFIDENTIALITY UNDER ENGLISH ARBITRATION LAW
The drafters of the Act deliberately omitted any express provision governing
the confidentiality of arbitration. As explained in the Departmental Advisory
Committee’s 1996 Report on the Arbitration Bill, while there was no doubt that
users of arbitration “place much importance on privacy and confidentiality as
essential features of English arbitration”, the principles were considered too
unsettled, such that codification would likely create more problems than it
would solve. The drafters were comforted, however, by the fact that the general
principles of confidentiality and privacy, “and the myriad exceptions to these
principles” were well-established under English law as implied into parties’
arbitration agreements.
It would be misleading though to suggest that there are no provisions at all
under English law on the confidentiality of arbitration proceedings. The Civil
Procedure Rules allow an English court to order an arbitration-related application
to be heard in public or private. The default position is that it will be private,
unless it is an application made by a party in relation to (i) a preliminary point
of law (section 45 of the Act); or (ii) an appeal on a point of law (section 69 of
the Act).
Those limited windows of publicity aside, the drafters decided that the
burden of developing the (implied) rules on confidentiality applicable to
arbitration was best left to the courts to conduct on a case-by-case basis.
II. THE ENGLISH LAW APPROACH IN CONTEXT
As a matter of English law, it is an implied term that parties to arbitration,

and the tribunal, must maintain the confidentiality of the hearing, the documents
generated and disclosed during the arbitral proceedings, and the award.
Similarly, the starting point in English law is that arbitration is private, with
hearings held behind closed doors. The Court of Appeal in Emmott set out the
following (non-exhaustive) exceptions to the general duty of confidentiality/
privacy: (1) where there is consent between the parties; (2) where there is an
order of the court; (3) where it is reasonably necessary for the protection of
the legitimate interests of an arbitrating party; and (4) where the interests of
justice require disclosure, including on the grounds of public interest.
The international approach does not show an overwhelming consensus as
to how to approach statutory treatment of arbitration. To name a few:
• Singapore recognises an implied duty of confidentiality, aligning with

the English law approach, and has also introduced additional powers
CONFIDENTIALITY IN ARBITRATION: IS IT “PRO-ARBITRATION”? 275
for tribunals to enforce confidentiality agreements between arbitrating

parties.
• Australia, however, has rejected an implied duty of confidentiality, and
in 2015 introduced statutory confidentiality provisions that apply on an
“opt-out” basis.
• Hong Kong updated its Arbitration Ordinance (Cap 609) in 2011 to
include an express duty of confidentiality, which prohibits parties to
Hong Kong-seated arbitrations from disclosing any information relating
to the arbitral proceedings or any arbitral award.
• Other jurisdictions (including in the U.S., Switzerland, and Sweden) have
historically been against implied duties, suggesting that parties who
value confidentiality should include such protections into their arbitration
agreements.
It is notable that jurisdictions that would each comfortably be described as

“pro-arbitration” take very different approaches to confidentiality.
III. REFORMING TO BE MORE “PRO ARBITRATION”
One initial reaction to discussion about reform to confidentiality might be

to ask whether there is anything “broken” to fix. It is unclear whether the
reasoning contained in the DAC report against including express confidentiality
provisions has been sufficiently undermined to justify a change in course. As
the drafters recognised, parties are free to agree bespoke confidentiality rules,
or adopt arbitral rules that provide for specific confidentiality protection.
Article 30 of the LCIA Rules is a good example: it requires the award, disclosed
materials and deliberations of the Tribunal be kept confidential.
It may also be the case that, in reality, any concerns are sufficiently dealt
with by tribunals during proceedings on an ad hoc basis, when an issue of
confidentiality arises. That is perhaps why a number of jurisdictions have
avoided imposing express provisions of confidentiality, and instead relying on
arbitral institutions and/or national courts to develop confidentiality rules.
There is, however, certainly a case to argue that implied duties, in general,
are not accessible to non-lawyers (and in many cases lawyers themselves), and
are generally not conducive to predictability of legal outcomes. Given the
international constituents of arbitration processes, confusion as to the parameters
of confidentiality may also stem from the divergent international approaches.
In that sense, it is important that the 2018 QMUL survey notes that
confidentiality remains an important feature of arbitration, and that
confidentiality concerns have been heightened by the increasing use of
technology in arbitral proceedings (and thus the growing spectre of data leaks
and hacks). But confidentiality is also prone to misunderstanding. Users may
be under the false impression that arbitration is automatically confidential,
with few exceptions. However, as noted above, (1) the scope of parties’
confidentiality obligation (at least under English law) is not rigid and may
require a fact-specific assessment; and (2) there are myriad exceptions that
make it possible for arbitral awards to find their way into the public domain
(the most obvious being through enforcement).
Whether this constitutes a mischief in the law, the Law Commission’s
deliberation on reform is not simply about fixing what is “broken”, it is also an
opportunity to innovate. Assuming codification is preferred, one such innovation
on the menu could be whether to make confidentiality rules “opt-in” or “opt-out”.
Opt-out provisions essentially give statutory footing to the current situation,
but do away with the need to worry about implied duties. That option might
appear the natural next step for English law, if reform were to be carried out
at all. But the discussion above suggests that the international conversation is
not one sided in favour of automatic or greater confidentiality.
Indeed, there are members of the arbitral community who argue that the
system should strive for transparency. This might involve an “opt-in” provision
whereby the default position is that arbitral proceedings are not confidentiality.
One perceived benefit of such a system might involve the systematic publication
of awards. Some commentators have suggested that the publication of arbitral
awards would help generate credibility, increase predictability, and foster a
system of precedent, which could be particularly useful for industries that
traditionally rely heavily on arbitration, such as construction or shipping. As
noted by the UK’s Lord Chief Justice in 2016: “across many sectors of law
traditionally developed in London, particularly relating to the construction
industry, engineering, shipping, insurance and commodities, there is a real
concern which has been expressed to me at the lack of case law on standard form
contracts and on changes in commercial practice”.
In that sense, it is possible to over-emphasise the practical value of
confidentiality. After all: (1) there are a number of broad exceptions to
confidentiality; and (2) according to the 2018 QMUL survey, confidentiality is
one of several important factors behind other arbitral attractions such as
enforceability of awards, avoiding specific legal systems/national courts,
flexibility and the ability of parties to select arbitrators.
Making confidentiality rules “opt-out” might be considered a hindrance on
attaining “pro-arbitration” status. Yet, on another view, greater transparency
risks losing what makes arbitration a unique alternative to litigation in the first
place. The systematic publication of awards, for example, might transform
arbitrators of a particular dispute into lawmakers in a much more general
sense. Arbitrators as lawmakers is arguably not the role that arbitration is
designed to play, particularly as English law expressly entitles parties to appeal to
the court on points of law. It could also lead to a situation where some arbitral
awards are more equal than others (depending on the constitution of the
tribunal).
Perhaps the best way to think about the meaning of “pro-arbitration” is to
consider what best aligns with the expectations of arbitrating parties. In
CONFIDENTIALITY IN ARBITRATION: IS IT “PRO-ARBITRATION”? 277
Professor Bermann’s seminal article on gateway issues, he considered certain

types of threshold issues that should be determined by courts. For students of
arbitration who have always considered kompetenz-kompetenz the sacred soul
of arbitration law, there is a healthy degree of scepticism about whether court
intervention in the manner described by Professor Bermann is a positive
development. But of course, excluding courts completely from determining
threshold issues—particularly issues that go to consent—does not necessarily
mean a jurisdiction is “pro-arbitration”. Parties who have not consented to
arbitration do not expect to end up in arbitration.
Transforming the system in a way that ignores the continued and
consistent expectations of users is unlikely to be “pro-arbitration”. Based on
the surveys to date, there appears to be some expectation of confidentiality
among parties, but is confidentiality a necessary ingredient of an arbitration
agreement? Is it necessary for the business efficacy of the agreement (which is
broadly the English law standard for implying terms into a commercial
contract)? It might be a good time for practitioners to think about this. Indeed,
the value of inserting an express statutory provision on confidentiality, whether
“opt-in” or “opt-out”, is that parties would need to think about what they want
from their arbitration. Without that reflection at the outset, there is a risk that
parties arbitrate under a misunderstanding of what their obligations are.
The Law Commission’s review of the duty of confidentiality, and the ensuing
debate, can provide an opportunity to consider what arbitration has become,
and what it should aspire to be.
Chapter 49
NAVIGATING VALUE TRADE-OFFS:
INTERNATIONAL ARBITRATION AND BEYOND
Janet Whittaker*
It is an honor to contribute to this tribute to Professor Bermann and his

extraordinary contribution to higher learning in particular in the field of
international arbitration and to present this brief reflection on his article,
“What Does it Mean to Be ‘Pro-Arbitration’?” In honor of Professor Bermann’s
wide-ranging interests, I thought that he would enjoy a piece that ties his
arbitration-centered analysis to another issue vital to the international legal
community—sustainable development. I am very grateful to Professor Bermann
for his excellent teaching while I attended Columbia Law School, for his guidance
during my time as a research assistant, and for sharing his wisdom about
international arbitration, international trade, and European law with me and
so many others.
I. VALUE TRADE-OFFS IN INTERNATIONAL ARBITRATION
In his 2018 article “What Does it Mean to Be ‘Pro-Arbitration’?,”1 Professor

Bermann notes that “shortcomings notwithstanding, international arbitration
has been overwhelmingly a success story. It has posited admirable international
dispute resolution objectives and has succeeded remarkably in achieving them.”2
As the article identifies, this success has not depended upon a one-
dimensional, straightforward approach to what policies or practices are “pro-
arbitration,” and in what measure. Citing Professor Park, Professor Bermann
identifies international arbitration’s basic goals, namely, “accuracy, fairness,
and efficiency and an enforceable award.”3 Additionally, he provides a “non-
exhaustive catalogue of more specific ways of gauging the [pro-arbitration]
character of a policy or practice.”4 However, Professor Bermann proceeds to
acknowledge that a measure may advance arbitration’s purposes according to
one of the criteria catalogued, but “plainly fail to advance arbitration’s purposes
* Janet Whittaker is a Senior Counsel (formerly a Partner) in Clifford Chance LLP’s

Washington, DC office. She specializes in international arbitration, international trade and
investment, ESG, and international environmental and climate change matters. Janet also sits as
arbitrator in international disputes.
1 “What Does it Mean to Be ‘Pro-Arbitration’?”, George A. Bermann, Arbitration International,
2018, 34, 341–353 (Bermann Article).

2 Bermann Article, p. 342.
4 Id.
279
in others of them,”5 or indeed “actually and demonstrably disserve them according

to others.”6
The upshot is that “the criteria for gauging the arbitration-friendliness of a
policy or practice may well be in direct tension with one another, thus pointing
in different directions.”7 Consequently, an arbitral tribunal may be faced with a
difficult balancing act between two pro-arbitration values with which
tribunals are “rightly concerned”, but that in a specific situation do not align.
Professor Bermann gives examples of such instances involving competing pro-
arbitration considerations: written witness statements (“demonstrably sav[ing]
time and money,” but potentially “undermin[ing] accuracy in the administration
of justice.”);8 the use of tribunal secretaries (“potentially pitting economy in the
conduct of the arbitration against effectuation of the intentions of the parties.”);9
addressing questionable procedural requests by counsel (“the tribunal must
weigh its obligation to proceed with speed and economy, on the one hand, against
its obligation to avoid annulment of the eventual award on due process grounds.”);10
and extending arbitration agreements to non-signatories (“A court’s entertaining
the objection at the outset of the arbitration undoubtedly entails delays and
complications that may be detrimental to the economy of the arbitral proceeding,
but its doing so importantly vindicates the principle of consent on which arbitration
is based.”).11 In each of these situations, a tribunal (or at times, a court) must
manage the trade-offs that competing pro-arbitration considerations entail.
As a discipline that at times involves a careful balancing act between
policies that contribute to a positive value outcome in one situation, but may
compromise it in another, international arbitration is like countless other
disciplines and aspects of life, from economic policy to national security policy
to more personal decisions such as how to balance nutrition and exercise when
trying to attain a particular kind of fitness.
Sustainable development is a particular area of law, policy, and practice
that stands out in my mind as an area that raises many of the same issues that
Professor Bermann has highlighted for us in relation to international arbitration,
in that it brings together multiple objectives that in certain situations point in
opposite directions. The competing considerations in international arbitration
and sustainable development of course differ; however, both provide examples
of disciplines in which privileging one value may appear to undermine another
such that skillful management of the interaction among the multiple values is
required.
5 Bermann Article, pp. 343–44.

7 Id.
8 Bermann Article, pp. 345–46.
10 Id.
NAVIGATING VALUE TRADE-OFFS 281
II. VALUE TRADE-OFFS IN THE SPHERE OF SUSTAINABLE

DEVELOPMENT
The concept of sustainable development is widely accepted around the

world. It has been reflected in international treaties, United Nations General
Assembly resolutions and the judgments of international and national courts.
Relevantly, the sustainable development concept has been recognized and
developed by arbitral tribunals, including in the Indus Waters Kishenganga
Arbitration12 and the Iron Rhine arbitration.13
The principle of sustainable development under international law is premised
on three foundational pillars—economic development, social development,
and environmental protection.14 Achieving sustainable development requires
a process of interaction among these three pillars, which are intended to be
interdependent and mutually reinforcing;15 notably, however, there no definitive
roadmap for this interaction.
In the policy context, the 2030 Agenda for Sustainable Development and
its Sustainable Development Goals (SDGs) have become the focal point of the
sustainable development agenda. The SDGs are 17 interlinked global objectives
that are intended to “provide a shared blueprint for prosperity for people and
the planet, now and into the future.”16 The goals “recognize that ending poverty
and other deprivations must go hand-in-hand with strategies that improve
health and education, reduce inequality, and spur economic growth—all while
tackling climate change and working to preserve our oceans and forests.”17 169
targets accompany the 17 SDGs and together they aim to “stimulate action over
the next 15 years in areas of critical importance to humanity and the planet.”18
12 The Indus Waters Kishenganga Arbitration (Pakistan v. India), PCA Case No. 2011/01,
Partial Award, 18 Feb. 2013, ¶ 449 (referring to the decision of the International Court of Justice
in Case concerning the Gabčíkovo-Nagymaros Project (Hungary/Slovakia), which “expounded
upon the principle of ‘sustainable development’ … referring to the ‘need to reconcile economic
development with protection of the environment’.” See Case concerning the Gabčíkovo-Nagymaros
Project (Hungary/Slovakia), Judgment, Sept. 25, 1997, 1997 ICJ Rep. p. 7 at p. 78).
13 Arbitration Regarding the Iron Rhine (Ijzeren Rijn) Railway between the Kingdom of
Belgium and the Kingdom of the Netherlands, Award, 24 May 2005, PC Award Series (2007) ¶ 58
(citing sustainable development as one of the “emerging principles” of international
environmental law).
14 This concept of three pillars was first adopted in the Johannesburg Declaration, which
expresses a “collective responsibility to advance and strengthen the interdependent and mutually
reinforcing pillars or sustainable development—economic development, social development and
environmental protection—at the local, national, regional and global levels.” Johannesburg
Declaration on Sustainable Development, Report of the World Summit on Sustainable Development,
A/CONF.199/20*, Sept. 4, 2002, Principle 5.
15 Id.
16 “Do you know all 17 SDGs?”, U.N. Department of Economic and Social Affairs, Sustainable
Development, available at: https://sdgs.un.org/goals.

17 Id.
18 United Nations General Assembly Resolution 70/1, “Transforming our world: the 2030
Agenda for Sustainable Development,” A/RES/70/1, Oct. 21, 2015, Preamble, available at
While acknowledging the importance of the overarching societal goals

underpinning the 2030 Agenda for Sustainable Development, many commentators
have nonetheless reflected on the complexity of integrating the triple imperatives
of economic development, social development, and environmental protection.
Specifically, concerns are expressed around how to progress what appear to
be competing or conflicting SDGs and/or their targets; for example, how can the
sustainable management and effective use of nature resources be reconciled
with economic growth (SDG Target 12.2 and SDG Target 8.1)? Much like
Professor Bermann describes in relation to international arbitration, there is a
“multiplicity of metrics for identifying”19 what measures are pro-sustainable
development. Similarly, as he puts it, “pursuing a ‘pro-arbitration path, in one
sense of the term, may operate at cross-purposes with what may legitimately be
considered as pro-arbitration in one or more other senses of the term.”20 Equally,
a measure that advances sustainable development according to one of the
relevant metrics (one of the three pillars or 17 SDGs and 169 targets) may fail
to advance sustainable development’s purposes in others of them.
As mentioned above, Professor Bermann points out that, where conflicts
exist, “trade-offs among pro-arbitration considerations become inevitable.”21 He
also highlights “the necessity of managing the trade-offs that competing pro-
arbitration considerations entail.”22 In the sustainable development context,
understanding how to navigate the interplay among the considerations relevant
to sustainable development will become increasingly vital. This is particularly
the case in relation to the energy transition. For example, in the context of
mining of rare earth minerals, economic interests (job creation, supply chain
certainty, growth of green industries) may be in tension with social interests
(the human rights of those affected by mining activities, including any
environmental degradation and impacts on cultural rights), or environmental
interests (pollution from mining activities, mitigation of climate change).
Competing priorities may even arise within one pillar—for example, the
environmental sustainability priority to source raw earth minerals critical to
the development of green industries necessary for mitigating climate change
may conflict with the environmental sustainability priority to avoid polluting
local communities through raw earth mineral mining activities. An essential
question will be how to balance these different priorities and how to seek the
most appropriate trade-offs among them.
https://www.un.org/en/development/desa/population/migration/generalassembly/docs/
globalcompact/A_RES_70_1_E.pdf.
21 Id.
NAVIGATING VALUE TRADE-OFFS 283
III. NAVIGATING THE INEVITABLE TENSIONS
So how do we best to navigate the inevitable tensions between these different

but interlinked priorities? Professor Bermann dismisses the possibility of
establishing “a consensus over priorities among the values pursued by
arbitration,”23 not least because “the stakes for any particular arbitration value
will vary starkly with the policy or practice under consideration.”24 Similarly, in
sustainable development, no one pillar is considered to take precedence,
although at times it may be necessary to prioritize among goals and targets.
Professor Bermann proposes a number of “techniques for managing the
inevitable trade-offs between competing pro-arbitration considerations.”25 At
their root, these techniques require us to “seek[ ] some form of compromise”26
and to ensure that a measure pursuing one pro-arbitration consideration is not
excessively or unnecessarily detrimental to one or more others. In the SDGs
context, there is also a focus on developing frameworks for identifying trade-
offs and ensuring a balance among economic, social, and environmental goals.
IV. CONCLUDING THOUGHTS
In highlighting the potential for pro-arbitration considerations to compete

in his article on “What Does it Mean to Be ‘Pro-Arbitration’?” Professor Bermann
reminds us that it is okay for there to be tensions. Different priorities co-exist
and must at times be traded-off, but this reflects a feature rather than a failure of
international arbitration. In complex fields, it is inevitable that priorities among
constituent interests will sometimes conflict and need to be reconciled. This
applies equally to both international arbitration and sustainable development.
What we also learn is that each individual decision balancing among different
pro-arbitration considerations is part of the broader story of international
arbitration. For those of us grappling with internal tensions in our fields of
work, we can draw from Professor Bermann’s scholarship that it is over the long
arc of time that we should measure the collective impacts of those decisions,
the objectives towards which we are working, and, ultimately, the success of
the system.

24 Id.
25 Bermann Article, pp. 348-49.
Chapter 50
COMMENT ON “WHAT DOES IT MEAN TO BE
‘PRO-ARBITRATION’?” BY PROFESSOR GEORGE
BERMANN
Jean Marie Lambert*
I. INTRODUCTION
It is not surprising for anyone who has worked closely with Professor
Bermann that his piece What Does it Mean to Be “Pro-Arbitration”? includes the
statement “international arbitration does not exist in a vacuum” because to
work with Professor Bermann is to be introduced to an international arbitration
community focused on inclusion, integration, and expansion. It would be easy
for Professor Bermann to operate as if international arbitration did exist in an
elite academic vacuum, one he has mastered. In my experience, however, he is
just as inquisitive and eager to integrate more legal theories into the realm of
international arbitration, but as he is to bring in more legal scholars from
around the world. So, when Professor Bermann writes that being pro-arbitration
does not always mean excluding and isolating international arbitrations from
national courts and other international legal frameworks, I read that as an
obvious extension of what Professor Bermann encourages in his students: to
be open-minded, to be curious, and to draw on the world around them. In this
comment, I hope to illustrate the ways in which Professor Bermann is right to
assert that international arbitration is strengthened by not operating in a
vacuum, both as a community and as a legal framework.
II. PROFESSOR BERMANN AS MY INTRODUCTION TO THE

INTERNATIONAL ARBITRATION COMMUNITY
Like so many of my colleagues in international arbitration, I was fortunate

enough to grow up in a number of different countries. So, when I started at
Columbia Law School I knew I wanted to do something related to international
law but I was not sure what. Thanks to the excellent advice of Simon Batifort,
with whom I now work, I signed up for a class with Professor Bermann and as
a staffer on the American Review of International Arbitration (ARIA). I was
quickly sold on practicing international arbitration. In that one-semester class,
Professor Bermann and Professor Duggal introduced international arbitration
as a practice that draws not just on international law but on all sorts of
* Jean Marie Lambert is an Associate at Curtis, Mallet-Prevost, Colt & Mosle, LLP.
285
domestic legal theories as well. They encouraged the L.L.M.’s in our class to
share their experiences working in different legal jurisdictions and encouraged
all of us to consider both sides of every issue. In a profession that can often still
be biased towards Western legal norms, it was encouraging to find a space
where legal scholars and practitioners from such a wide swath of countries
were asked to provide insights on the legal theories and frameworks.
Professor Bermann had cultivated this incredible multicultural academic
space and while I was eager and interested, getting more involved felt like a
daunting task. Here was Professor Bermann, a giant in the international
arbitration world, surely he would not have time for a student like myself who
was new to the community—I had not even known to sign up for the Vis or
Jessup teams. Nevertheless, I took a chance and applied to be Editor-in-Chief
of ARIA at the end of my second year when applications for positions opened-
up. I had a lot of ideas not just for the academic side of the journal but also for
integrating the global community Professor Bermann created in his classrooms
into the journal experience. To my surprise, Professor Bermann welcomed me
and my ideas with open arms. Giving presentations to Professors Bermann,
Duggal, and Smit was always nerve-wracking but with their support and feedback
I became a more confident advocate for and leader of the journal. It was during
this time working at ARIA that I saw how committed Professor Bermann was
to uplifting the voices of his past students and supporting their careers. It did
not matter to Professor Bermann whether they had checked certain academic
boxes, if they were interested in and dedicated to bettering their writing and
the field of international arbitration he was willing to work with them.
This is the community I think of when I read that international arbitration
does not operate in a vacuum. This is the community I think of when Professor
Bermann writes about how being pro-arbitration is about acknowledging the
extrinsic values of the legal community at large and not just about promoting
arbitration at all costs. During my time as Editor-in-Chief at ARIA, with the
support of Professors Bermann, Duggal and Smit, we were able to publish
ARIA’s first diversity issue. We focused on publishing voices that were a
minority in international arbitration because of gender, nationality, or race.
Professor Bermann understands that arbitration is not just a legal framework
for dispute resolution, international arbitration relies on a community of
practitioners and that community is only strengthened by welcoming and
including those of all legal backgrounds from any country.
III. INTERNATIONAL ARBITRATION AND THE LEGAL SYSTEM AS A

WHOLE
Professor Bermann’s dedication to creating an inclusive community of

lawyers from different backgrounds is also reflected in his understanding of
how international arbitration should interact with other legal frameworks and
national court systems of different countries. In his piece, Professor Bermann
COMMENT ON “WHAT DOES IT MEAN TO BE ‘PRO-ARBITRATION’?” 287
illustrates this through the example of interim measures. Previously it was

thought, Professor Bermann explains, that “allowing parties access to court for
interim relief prior to or in the midst of arbitration was contrary to both the
letter and the spirit of arbitration.” He goes on to explain that now there is
consensus for the “availability of interim relief from a court in conjunction with
arbitration, albeit only under appropriate circumstances.” Instead of international
arbitration being most efficient while operating in a vacuum, “access to a national
court for interim relief has come to be viewed as advancing international
arbitration’s purpose.”
In my own experience in practicing international arbitration, which I admit
I have only been doing for a year, I have found the issue of arbitrability to reflect
the same dynamic Professor Bermann highlights about interim measures. At first
glance it seems like allowing national courts to review arbitrability would
negate the authority of international commercial arbitrations. I, however, feel
that it does just the opposite. Parties enter into contractual arbitration clauses
for a number of reasons, one of which may be to keep disputes out of the very
national court systems we are discussing. At the end of the day though, those
same parties also rely on court systems for the enforcement of those
arbitrations. If national courts are going to be tasked with enforcing the
awards, there may also need to be a way of ensuring those awards comport
with what Professor Bermann describes as the “extrinsic values to which the
legal system as a whole attaches fundamental importance.” One of those values,
for arbitration clauses especially, is the notion of consent. I think it is actually
pro-arbitration for national courts to maintain some power to review the
arbitrability of a dispute, i.e., the scope of the contractual agreement to
arbitrate disputes, if they are also tasked with enforcing the awards. Such a
review provides legitimacy to tribunals and perhaps more importantly, signals
to other contracting parties what will be enforceable in each jurisdiction.
In First Options, Inc. v. Kaplan, 514 U.S. 938 (1995), the Supreme Court held
that courts must review de novo whether a dispute is subject to an agreement
to arbitrate. In order to overcome that presumption, a party must prove by
clear and unmistakable evidence that the contract delegated questions of
arbitrability exclusively to the arbitrators. This seems like a reasonable balance
to strike between the interests of arbitration and the interests of domestic
courts. Where things start to get a bit muddled, in my opinion, is that some
courts in the U.S. will interpret an arbitration clause’s reference to certain
arbitral rules that allow for the arbitration of arbitrability as that clear and
unmistakable evidence the parties meant to delegate the issue of arbitrability.
While I understand that contracts cannot explicitly spell out every scenario in
a dispute resolution clause, I also think that if parties want to remove meaningful
review of arbitrability by domestic courts in jurisdictions where an award is
being enforced courts may require more evidence than reference to certain
arbitration rules. Courts requiring heightened clarity on the issue of who
reviews arbitrability would also signal to parties to contract more clearly in

their dispute resolution clauses.
Given that many domestic courts make their decisions publicly, more
opportunity for courts to review arbitrability increases the legitimacy of the
awards—as lingering questions about the consent of the parties to arbitrate
would raise questions around the award—and clarifies to other parties wishing
to engage in international commercial arbitration how to draft their dispute
resolution clauses. Instead of shying away from these sorts of review, while it
may be slightly more costly in the long run for parties, those in international
commercial arbitration should be working with domestic courts to maintain
an acceptable level of checks and balances. As Professor Bermann emphasized,
“it may actually be in international arbitration’s best interests to advance
values that are themselves extrinsic to arbitration even if doing so comes at
some price to the interests of arbitration narrowly conceived.”
IV. CONCLUSION
In short, I praise Professor Bermann both for his piece and for his tireless
efforts in building the international arbitration community of which I am
proud to be a member. International arbitration is not, and should never be,
practiced in a vacuum. We should all be reaching out to integrate ourselves and
our practices into the larger international legal framework and into the
national legal frameworks we work with.
Chapter 51
WHAT DOES IT MEAN TO BE
“PRO-ARBITRATION”? A DUE PROCESS ANALYSIS
José Manuel García Represa*
I met Professor Bermann in the spring of 2003, as I was completing my

LL.M. degree at the Columbia University School of Law and enrolled in his
course on Transnational Litigation and Arbitration. I then had the unique
opportunity of assisting him—together with a team of brilliant colleagues—with
the research that led up to the volume Transnational Litigation in a Nutshell,
published in 2003 by Thomson West. I did not know then the profound effect
that Professor Bermann would have on shaping my views on the theory and
practice of the area of law that I was seeking to specialize in: international
arbitration. It was not only the research assignment itself that had this effect.
It was not only the opportunity to work alongside brilliant legal minds from
multiple legal backgrounds around the world that challenged and inspired me.
It was, first and foremost, Professor Bermann himself—his liveliness, his spirit, his
insatiable curiosity and his passion for asking (difficult) questions—sometimes,
questions that called for revisiting issues considered settled by conventional
wisdom.
Professor Bermann’s piece “What Does it Mean to Be ‘Pro-Arbitration’?”,
published in Arbitration International in 2018, is a perfect illustration of these
traits, and the starting point for the thoughts that underpin this modest
contribution.
In that article, Professor Bermann posits that any given policy or practice may
be pro-arbitration when looked at from one angle, but may go entirely against
the goals of international arbitration, thus being deservedly labelled anti-
arbitration, when it is considered from a different angle. Perhaps no single
issue better illustrates this point than the consideration given to due process
allegations in international arbitration.
* José Manuel García Represa is a Partner of International Arbitration at Dechert (Paris)
LLP. Mr. García Represa has 20 years of experience practicing international commercial and
investment arbitration, both as counsel and arbitrator. He is a graduate of Columbia Law School
(LLM ’03, Parker School Certificate in International and Comparative Law and Fulbright
Scholar), where he served as research assistant to Prof. Bermann. He holds law degrees from
the University of Paris I, Panthéon-Sorbonne (DESS in International Commercial Law, 2001 and
Maîtrise in Law, 2000) and of the Universidad Complutense of Madrid (Licenciatura in Law,
2000). Mr. García Represa teaches Energy Disputes at Paris II Assas University (LL.M. Assas
World Arbitration and Disputes Settlement) and Damages at the Sciences Po Law School of Paris
(LL.M. in Transnational Arbitration & Dispute Settlement). He currently serves as President of
the French chapter of the Club Español del Arbitraje (CEA).
289
It is trite that due process is an integral and fundamental part of the Rule
of Law. Without it, arbitration would not have become the successful dispute
resolution mechanism that it is today, as users would have no interest in
participating in proceedings that disregard their most elemental rights and,
ultimately, yield decisions likely to be unenforceable in most, if not all, legal
orders. While all stakeholders would agree to the importance of ensuring due
process, its practical implications and contours are far from straightforward,
as I have come to witness first-hand in my practice as counsel and arbitrator
(having to address the parties’ proverbial invocation—and at times abuse—of
due process).
Most arbitrators have faced protracted debates seeking to delineate the
requirements for a litigant to be afforded “sufficient” due process. In her 2016
Freshfields Lecture, Professor Lucy Reed equated due process with “core
principles of adjudicative legitimacy” and distinguished violations of due
process from a party’s mere dissatisfaction with procedural decisions by the
arbitral tribunal (L. Reed, “Ab(use) of due process: sword vs. shield”, Arbitration
International, OUP 2017, p. 366). One key challenge of due process debates
before arbitral tribunals is distinguishing between what could be a true violation
of a core principle (which would expose an award to annulment by domestic
courts) and mere subjective perceptions of unfairness of a decision by the
party to whom the decision is unfavorable.
Upholding due process is an obvious pro-arbitration policy. But an “excess
of” so-called due process—where tribunals yield to a party’s claims, and even
intimidatory threats, of purported due process violations—is definitely not, in
the long run, a pro-arbitration policy. I will illustrate this proposition through
three sets of comments.
First, the origin of due process in international arbitration supports the
view that the notion should be understood narrowly (subject to the tribunal’s
discretion). This is not to say that the scope of rights included, traditionally,
under the umbrella of due process (such as the right to proper notice to the
respondent, a party’s opportunity to present its case and to address its opponent’s
case, a party’s right to an independent and impartial tribunal or the principle
of party equality) should be reduced or that due process has evolved or should
evolve towards the elimination of certain rights. Rather, the point here is simply
that the norms that import due process into arbitration have always strived to
avoid its confusion with unlimited procedural opportunities, by defining it
narrowly.
For instance, Article 18 of the UNCITRAL Model Law refers to each party
being given “a full opportunity of presenting his case.” A full opportunity to present
one’s case, however, does not mean an unlimited opportunity, in which any and
all avenues to make arguments, to adduce evidence or to rebut the opponent’s
case must be afforded. This point is made eloquently in a 2016 article by
Professor Klaus Peter Berger and Dr. Ole Jensen: on the basis of the travaux
préparatoires of the Model Law, the authors note that one earlier draft qualified
WHAT DOES IT MEAN TO BE “PRO-ARBITRATION”? A DUE PROCESS ANALYSIS 291
the “full opportunity of presenting [the] case” by the words “at any stage of the
proceedings.” This wording was rejected because of the concern that it could
be relied upon to prolong proceedings unnecessarily. As Professor Berger and
Dr. Jensen rightly noted, “[t]he right to a ‘full opportunity of presenting one’s
case’ does not entitle a party to obstruct the proceedings by dilatory tactics and,
for example, present any objections, amendments, or evidence only on the eve of
the award” (K.P. Berger, J.O. Jensen, “Due process paranoia and the procedural
judgment rule: a safe harbour for procedural management decisions by
international arbitrators”, in W. Park, Arbitration International, OUP 2016,
pp. 421–422).
Professor Reed traced the drafting evolution from the 1976 UNCITRAL
Rules, through Article 18 of the Model Law, to the 2010 UNCITRAL Rules, and
interestingly noted that the early “full opportunity of presenting [their] case”
given to parties, “at any stage of the proceedings” (1976 Rules) had become
qualified, by 2010: “instead of ‘at any stage’ of the proceedings, the parties must
be able to present their cases ‘at an appropriate stage’; […] rather than a ‘full”
opportunity, the parties are entitled to a ‘reasonable’ opportunity of presenting
their case; and […] in exercising its discretion to conduct the arbitration, as it
considers appropriate, the tribunal is to consider efficiency and cost, as well as
due process fairness” (L. Reed, supra, p. 369).
By way of further example, Article V(1)(b) of the New York Convention on
the Recognition and Enforcement of Foreign Arbitral Awards enables a court
to refuse recognition and enforcement if “[t]he party against whom the award
is invoked was not given proper notice of the appointment of the arbitrator or of
the arbitration proceedings or was otherwise unable to present his case.” The
words “present his case” are not amplified by syntagms such as “at any stage of
the proceedings,” nor does the Convention require that parties have a “full”
opportunity. The use of the adverb “otherwise” should not be misunderstood
as retreating from this position or permitting that any procedural discontent
be elevated to the level of a due process violation. It should, instead, be—and
has been—interpreted narrowly by courts applying this provision, in a way
that is protective of genuine due process without curtailing an arbitral tribunal’s
ability to efficiently manage the proceedings.
Second, courts in set-aside proceedings (at the seat of the arbitration) or in
recognition and enforcement proceedings have taken an approach consistent
with a narrow interpretation of due process as grounds for censoring an
arbitral award. Comprehensive case law reviews across multiple jurisdictions
carried out, inter alia, by Philippe Pinsolle (“The Need for Strong Arbitral
Tribunals”, in A. Menaker, International Arbitration and the Rule of Law:
Contribution and Conformity, ICCA Congress Series 2017), Professor Berger and
Dr. Jensen (see supra, 2016) and Michael Polkinghorne and Benjamin Ainsley
(“Due Process Paranoia: Need We Be Cruel to Be Kind?”, Journal of International
Arbitration, Kluwer Law International, 2017) all confirm that state courts rarely
interfere with procedural management decisions by arbitrators, even when
such decisions are challenged as due process violations. The deference afforded
by courts to arbitral tribunals is such that “[i]t is not ground for intervention that
the court considers that it might have done things differently” (ABB AG v Hochtief
Airport GmbH and Athens International Airport S.A. [2006] EWHC 388 (Comm)
¶ 67, cited in K.P. Berger supra, note 46). Only when courts consider that the
procedure must have been conducted differently for due process to be
safeguarded will an intervention (in the form of setting aside or refusing to
recognize or enforce an award) be justified.
The recent (February 2020) decision of the Singapore Court of Appeal in
the China Machine NewEnergy Corp. v. Jaguar Energy Guatemala LLC is illustrative
of the approach of national courts. The lower court had been faced with a set-
aside application on grounds of (i) due process violation (specifically, failure to
afford the applicant a reasonable opportunity to present its case and to consider
its arguments in relation to one of the claims), (ii) defective arbitral procedure
(failure to treat the parties equally, to ensure that the applicant had a full
opportunity of presenting its case, and to restrain the opposing party from
breaching its obligation to arbitrate in good faith) and (iii) violation of public
policy and corruption (see, for instance, C. Bao, “Return to Reason: Reining in
Runaway Due Process Claims”, Journal of International Arbitration, Kluwer Law
International 2021, p. 63). The lower court denied the set-aside application,
which was then brought before the Court of Appeal solely on the due process
ground.
The Court of Appeal confirmed the lower court’s dismissal, stressing that a
“full opportunity” to present one’s case, under Article 18 of the Model Law,
should not be understood to be infinite, but rather as limited by considerations
of fairness and reasonableness. The Court held that, in determining precisely
what such a “full opportunity” entails, it must consider the specific facts and
circumstances of the case before it, and assess whether what the tribunal did
(or failed to do) is consistent with what a reasonable and fair tribunal would
have done (or abstained from doing) in similar circumstances (China Machine
New Energy Corp. v. Jaguar Energy Guatemala LLC [2020] S.G.C.A. 12, ¶ 104).
The Court’s attempt to set out an objective test (aimed at excluding the
possibility that an award could be set aside simply because the tribunal did not
act as the court would have) is positive, as it shows a significant degree of
deference to the arbitral tribunal’s decisions. In practice, however, defining what
is “reasonable” and “fair” in certain circumstances necessarily involves some
degree of subjectivity.
Third, a tribunal that yields to claims of procedural unfairness disguised as
due process claims misinterpret the notion of due process and, arguably,
misunderstands its role as director of the arbitral process. Such a tribunal,
while pursuing legitimate goals (to safeguard due process, uphold the Rule of
Law and contribute to the perception of arbitration as a viable and trustworthy
means of dispute resolution) is in effect unwittingly achieving the opposite result.
WHAT DOES IT MEAN TO BE “PRO-ARBITRATION”? A DUE PROCESS ANALYSIS 293
For example, a tribunal may be faced with requests for lengthy extensions
of time that require revisiting the entire calendar (we have seen an inflation of
such requests in times of the COVID-19 pandemic, some more meritorious than
others…), requests for the suspension of the proceedings while a party seeks
to appoint new counsel (repeatedly), or—more frequently—requests to
submit new evidence at the eleventh hour (shortly before, at and even after the
evidentiary hearing).
Such applications are often crafted in due process terms. For instance, the
applicants may argue that, without the additional requested time, they will be
unable to fully present their affirmative case or that, in the absence of the new
evidence, they will be deprived of a meaningful opportunity to rebut the
opposing party’s case. Whether or not such applications are meritorious will
depend on the specific circumstances of each case. There is obviously no one-
size-fits-all response. However, some tribunals routinely yield to such
applications, even when unmeritorious, only to mitigate the perceived risk that
doing otherwise may lead to the award being annulled on due process grounds.
While such commitment to due process may appear to reinforce the Rule of
Law and legitimacy of international arbitration, it comes at a cost: the proceedings
take longer (especially if changes to the procedural calendar require hearing
dates to be vacated, for example); this, in turn, will increase the parties’ legal
fees and overall cost of the proceedings. Such a result feeds into the criticism
that arbitration proceedings are too lengthy and expensive. Moreover, such a
result typically favors the party with deeper pockets and little interest in a
speedy resolution of the dispute. Not least of all, it bears recalling that justice
(unduly) delayed is justice denied.
Professor Bermann touched upon this apparent tension between due
process and considerations of cost and time efficiency in his 2018 article, and
referred to it as a “classic confrontation between pro-arbitration values” (supra,
p. 346). He rightly noted that “establishing general priorities among pro-
arbitration considerations is not a promising [notion]” (id., p. 348), even though
it could be one way of addressing such issues. I could not agree more, and I
would add that establishing such a hierarchy might prove impossible in limine,
especially if one is attempting to ascribe more importance to either due process
or efficiency. Both are faces of the same coin and one cannot reasonably be
sacrificed in favor of the other. In the words of Chief Justice Menon, “due process
and efficiency are equally essential” to the Rule of Law, and “neither of these values
will be sufficient without the other” (S. Menon, “Dispelling Due Process Paranoia:
Fairness, Efficiency and the Rule of Law”, Asian International Arbitration Journal,
2021, p. 7).
How, then, is an arbitral tribunal to resolve the apparent conundrum between
due process and time and cost efficiency of the proceedings?
It is not as straightforward as we, arbitrators, would like since case-specific
circumstances must be weighed to design the most reasonable approach. As a
general proposition—to use the words of Philippe Pinsolle—we need strong
arbitral tribunals (see supra, 2017); tribunals that will not hesitate to make use
of their power to manage the proceedings and to establish procedural rules
that limit dilatory requests couched in due process terms. A more hands-on
approach by tribunals would contribute to disciplining the parties and their
counsel, thus contributing to increased efficiency. Such active intervention
could take the form of (i) regular procedural calls or meetings with the parties
(not just the traditional first session and pre-hearing conference call), so as to
encourage them to raise any issues promptly; (ii) providing the parties with a
list of issues or topics on which the tribunal requires clarification or wishes the
parties to focus on ahead of the main hearing (rendering the hearing more
efficient, especially if witness and/or expert evidence is to be heard, and
avoiding delays caused by post-hearing debates); (iii) indicating to the parties,
prior to them exchanging lists of witnesses and experts called to testify at the
hearing, whether there are any such witnesses or experts from whom the
tribunal is particularly interested in hearing (which, conversely, will signal to
the parties those witnesses and experts who appear to be of secondary
importance to the tribunal); etc.
In short, a hands-on strong tribunal is one of the best pro-arbitration
policies. Yielding to a procedural request simply because a party waves the due
process flag will not advance the cause or aims of international arbitration. It
will not increase the legitimacy of arbitration, nor will it contribute to its
renown as an efficient means of resolving disputes. Of course, a tribunal should
always be minded not to be seen to prejudge any of the matters in dispute or
to limit the parties’ right to present their case in the manner they deem most
appropriate to their objectives. Doing otherwise would be out of step with one
extrinsic value to which all legal systems attach fundamental importance: the
procurement of justice.
Chapter 52
PRESUMPTIVE CONFIDENTIALITY IN
ARBITRATION RULES
Joseph E. Neuhaus*
Isn’t it time that all arbitral rules applicable to commercial arbitration

should provide that parties shall keep the proceedings confidential unless
otherwise agreed? I think the answer is yes, but with the important caveat that
the presumption should not apply to consumer or employment disputes, or
disputes to which a state or other public entity is a party. This move would, I
submit, meet George Bermann’s test for pro-arbitration-ness. And consideration
of the point suggests that Professor Bermann should add a thirteenth question
to his dozen ways of gauging the extent to which a policy or practice is “pro-
arbitration.”
Many arbitration rules already provide for presumptive confidentiality by
parties. (Virtually all rules require the arbitrators and arbitral institutions to keep
the proceedings confidential.) The London Court of International Arbitration
(LCIA), Singapore International Arbitration Centre (SIAC), and Hong Kong
International Arbitration Centre (HKIAC) rules all provide that parties must
maintain confidentiality of the proceedings, with appropriate exceptions such
as to make applications to a court to enforce or challenge the award or for
interim measures, where required by law, or to pursue or enforce a legal right
or claim. These rules are undoubtedly influenced by the English common law
implied undertaking of confidentiality. And even in the United States, where
there is no such common law rule, the rules promulgated by CPR and FedArb
provide for presumptive confidentiality.
But the most widely used rules, in particular the AAA/ICDR, ICC and JAMS
rules, do not. I’m sure it has been considered, and I can imagine the objections.
One might be that the law (outside of many former Commonwealth
countries) does not provide for confidentiality and the parties can always
agree to it in appropriate cases. But in my experience, business people and
most non-specialist lawyers who draft arbitration clauses think arbitration is
already confidential. In fact, after the need for a neutral forum in international
transactions, confidentiality is the most commonly cited advantage of arbitration
in business cases. So, when transactional lawyers throw an arbitration clause
into their agreements, it is more or less luck of the draw whether they think to
include a confidentiality clause. That has remained true over the three-plus
decades that I have been practicing.
* Joseph E. Neuhaus is Of Counsel at Sullivan & Cromwell LLP. Mr. Neuhaus retired after 30
years as a partner at the end of 2021 and now primarily sits as arbitrator and teaches.
295
Sure, sophisticated parties can agree to confidentiality once the dispute

arises. And they often do. But sometimes the level of hostility at that time is
such that it can be hard to agree on anything. Or a party may hesitate to
propose such an agreement because doing so may suggest that confidentiality
is a potential pressure point. But, more fundamentally, the whole point of
arbitral rules is to provide a set of off-the-shelf procedures that are sensible
and reflect the lessons of experience in managing arbitrations. The fact that
parties can and frequently do agree on confidentiality is a reason to incorporate
the provision into the rules, not a reason not to.
But this shared understanding that arbitration is confidential is not
universal. In consumer and employment disputes, and disputes with public
entities, I submit that the parties don’t have a background assumption that
their disputes will be resolved in a confidential setting. Employment and
consumer arbitration are frequently agreed upon in adhesion contracts with
relatively unsophisticated parties. The employee or consumer will not typically
share a background expectation that arbitration is confidential. It is reasonable
in that setting to expect the employer or business parties who will typically draft
the arbitration clause to articulate their desire for confidentiality if they want it.
Carving out arbitration with public entities may likewise be seen as an
effectuation of the likely expectations of the parties. Public entities are commonly
expected to conduct their business—and the settlement of their disputes—in
public. If they, or their counterparties, want a different regimen in a particular
case, they can be asked to articulate that desire.
Another objection to this proposal—and a weighty one—is that this is not
the time to whisper anything about confidentiality in arbitration. One of the
major aspects of the attacks on arbitration over the last 15 years is that it is
“secret justice,” that is, that it permits repeat offenders to continue to engage
in wrongdoing, and ignores broader societal imperatives of exposing and reining
in misbehavior by significant corporate actors and of ensuring accountability
of governments. The critics are focused, however, on the disputes that I propose
to carve out. While there have been suggestions that any arbitration between
parties of disparate size is somehow improper, the primary targets have been
employment, consumer and public-entity arbitration.
The carve-outs I propose may raise a separate objection: that tailoring any
of the general arbitration rules of the AAA, ICDR, ICC and JAMS to particular
kinds of disputes would undermine their broad-based nature, which has been
(it might be said) part of their success. Lawyers and businesspeople broadly
know what they’re getting when they select arbitration under these regimes,
without having to understand the details. The process is simple.
But I submit that it is time to make things a smidgen more complicated.
The attempt to treat business-to-business arbitration by the same standards
and using the same approaches as employment and consumer arbitration (and
to a lesser extent investor-state arbitration) puts business-to-business arbitration
at risk. Each time the proposed Arbitration Fairness Act, and similar bills
PRESUMPTIVE CONFIDENTIALITY IN ARBITRATION RULES 297
proposed in State legislatures, come up for debate, local and national arbitration
bodies scramble to ensure that the restrictions proposed on arbitrable topics
(e.g., antitrust claims) or doctrines (e.g., limits on competence-competence) do
not inflict damage to the system of business-to-business arbitration. Rather
than risk Congress or a State legislature “throwing out the baby with the bath
water”—as Edna Sussman referred to the problem some years ago—let’s just
begin to take the baby out of the bathwater. Differentiating business-to-business
arbitration from employment, consumer and public-entity arbitration on the
question of confidentiality—which has been a lightning rod for criticism—and in
this relatively small way—simply reversing a presumption of confidentiality—
is a good place to start.
In Professor Bermann’s 2018 article that serves as the springboard for this
series of essays, “What Does it Mean to Be ‘Pro-Arbitration’?,” he offers a “non-
exhaustive catalogue of . . .ways of gauging the character of a policy or practice”
as being “pro- or anti-arbitration.” His list includes questions such as “to what
extent does it effectuate the likely intentions or expectations of the parties.” I
have argued above that incorporating presumptive confidentiality into
business-to-business arbitration, but not employment, consumer and public-
entity arbitration, effectuates the likely intentions and expectations of the parties.
But as the foregoing discussion also illustrates, there is one additional
dimension on which to evaluate a measure’s pro- or anti-arbitration character,
and that is, to what extent does the practice address or accommodate criticisms
of arbitration while preserving its essential character? This question may become
increasingly important as the arbitration community confronts the current
challenges and skepticism in society at large. On this measure, too, I submit my
proposal to carve out employment, consumer and public-entity arbitration
from the proposed presumption in favor of confidentiality is decidedly pro-
arbitration.
Chapter 53
INTERNATIONAL ARBITRAL AUTHORITY AS AN
ACT OF COLLECTIVE IMAGINATION
Joshua Karton*
I begin by posing a question that reads like the setup for a very nerdy joke:
How are arbitral awards and money alike?
The answer is that both have value only because we all think that they have
value. Lord Mustill once observed that the only really significant difference
between an arbitrator and a judge is that, when a judge speaks, you can hear
the distant clanking of chains. Although they are empowered by a range of
public and private enactments, arbitrators are private citizens without access
to the coercive power of the state. Why, then, do we think of arbitral awards as
possessing legally binding force, and not just, for example, the moral authority
accorded the pronouncements of a village elder? The answer is no more and
no less than this: arbitral awards have binding force because a sufficiently
broad implicit coalition of like-minded parties, lawyers, judges, and legislators
believe that they do. To put it differently, the effectiveness of an arbitral award
is a social fact, not a legal inevitability. Consequently, arbitral authority itself is
an act of collective imagination, and to be pro-arbitration is to collude in that
act of imagination. Each act of faith buttresses the reality of arbitral authority.
A terminological note before proceeding: I use the phrase “arbitral
authority” to refer to the arbitrators’ power to bind the parties by issuing an
award that is legally enforceable. This conception of authority is inextricable
from the notion of arbitrators’ (and arbitration’s) legitimacy. To a large extent,
legitimacy is recognized power—an acceptance that power may be exercised
in certain ways and in certain circumstances. The concept of authority is
broader, but the power to bind the parties through an enforceable award is
what interests me here, since IT is the core characteristic that most
distinguishes arbitrators from other kinds of private dispute resolution
facilitators, like mediators. It is therefore also the characteristic of arbitral
authority most implicated by the notion of arbitration-friendliness.
I should also make clear that the argument I advance here is limited to
international commercial arbitration, although much of it also applies to domestic
commercial arbitrations. However, investor-state arbitrations are beyond the
scope of this essay, as are domestic administrative law proceedings that take
the form of arbitral proceedings and statutorily-mandated arbitrations in areas
such as family and employment law.
* Joshua Karton is an Associate Professor in the Queen’s University Faculty of Law; he has a
BA from Yale (2001), a JD from Columbia (2005); and a PhD from Cambridge (2011).
299
Most theoretical explorations of international arbitration dwell on the

same question: the source of arbitral authority. Does an arbitrator’s authority
derive solely or primarily from the agreement of the parties? Is it conferred by
the law of the seat of arbitration? Or does it arise from the combined recognition
of that authority by multiple national jurisdictions? The reason theorists focus
on this question is that one’s conception of the nature of the arbitration system
turns on where one locates the source of arbitral authority. Is the arbitration
system an autonomous legal order conjured into being by parties’ agreement
to arbitrate, a monolocal legal order delegated by the seat of arbitration and
dependent upon its regulatory favor, or an international (multilocal) order
that arises from a confluence of national legal orders, all of which are willing
to give legal effect to the arbitration?
These questions matter. But when it comes to the concept of being pro-
arbitration (or anti-arbitration, for that matter), they are all beside the point.
Commentators who believe states should be maximally pro-arbitration often
gravitate toward the representation of international arbitration as an
autonomous legal order. However, I suspect that many of them do so because
they incorrectly equate a state being pro-arbitration with it getting out of the
way. Ultimately, many proponents of arbitral autonomy on the level of theory
are drawn to it for instrumental reasons. They may be motivated by a libertarian
belief in the wisdom of the market and the inherent inefficiency of government
regulation. Or a conviction that arbitration is a superior means of resolving
commercial disputes, so that it ought to be protected and promoted at the
expense of litigation. Or by a distrust of states on non-libertarian grounds, in
those jurisdictions where the judiciary are corrupt or incompetent, or where
the court system is bogged down in delays and bureaucracy.
Even those who adhere to monolocal or multilocal representations of the
international arbitral order, and who therefore make their peace with legislative
and judicial oversight of arbitration (a broad category within which I locate
Professor Bermann), tend to argue for light-touch regulation that actively
promotes arbitration’s virtues (such as efficiency, flexibility, and commercial
reasonableness) but interferes only as much as necessary to blunt its vices
(such as conflicts of interest and legal inaccuracies). But wherever such a
worldview arises, as Professor Bermann has eloquently observed, equating
arbitration-friendliness with the absence of regulation is “distinctly facile.”
The important question is not where arbitral authority comes from, but why
arbitrators’ decisions are accorded binding force at all. The source of arbitral
authority is admittedly crucial, as it explains who may constrain that authority.
However, it does nothing to answer the question of how that authority may be
constrained, which is the question we must answer to understand the nature
and appropriate extent of “arbitration-friendliness.”
Having no official link to a sovereign, arbitrators possess no inherent
adjudicative authority. That authority must be conferred from somewhere.
However, all of the theories that have been proposed to explain the sources of
INT’L ARBITRAL AUTHORITY AS AN ACT OF COLLECTIVE IMAGINATION 301
arbitral authority display their own incompleteness when the why questions
are posed. If the arbitrator’s authority comes from the parties, why do states
invest public resources and employ their coercive power to enforce awards? If
the arbitrator’s authority comes from the seat, why are other states so much
more willing to enforce arbitral awards than court judgments? And if the
arbitrator’s authority comes from a cumulation of multiple states’ recognition
of that authority, why would they collaborate to recognize it?
In all these cases, state authorities act without legal compulsion, following
no obligations except those that are self-imposed. No “controlling legal authority”
requires them to accept arbitral authority, much less support it with public
resources. Great powers are not pressuring smaller states to ratify the New York
Convention. Domestically, no political advantage can be gained by enacting
and amending commercial arbitration legislation, as many in the arbitration
community have learned to their chagrin. (This is in contrast to arbitration
legislation that addresses systematically unequal contracting parties, such as
in the consumer and employment contexts.) No core ethical commitment
demands the enforcement of arbitral awards except pacta sunt servanda, which
demands no more of the state than that it recognize and enforce agreements
made by private persons for their own personal reasons.
I argue that parties and states recognize arbitral authority not because it
has any inherent legality, but simply because it is a good idea. In short,
arbitration works. That is the link to the value of the currency. Paper money
has negligible inherent value. Coins might have some small value for the metal
in them, but it is unrelated to their nominal value. Money that exists only as a
digital record has no inherent value whatsoever. If I were to print my own
scrip, and I could convince others to accept it in exchange for goods or services,
it would have value in exactly the same way official currencies have value:
because people would be willing to exchange it for other things that have value,
and indeed to accept it as a measure of that value. The more universally-
accepted money is as a medium of exchange and measure of value, the more
value it “actually” has. It is the universal acceptance, and nothing inherent to
money itself, that imbues it with value.
Why then does money enjoy such universal acceptance? Why has some
form of money emerged spontaneously in every organized civilization? Simply
because it accomplishes important social objectives. As an efficient and freely-
convertible medium of exchange, it makes every other form of transaction not
just possible but efficient. Exchanges need not depend on trust, or even on
acquaintance between the parties. Money can make possible the valuation and
convertibility of imaginary and future goods. In short, money works.
Arbitral authority is the same. Parties recognize it because it serves their
interests. It provides an efficient, customizable, confidential process that yields
a definitive resolution of their dispute rendered by an expert decision-maker.
And thanks to the willingness of states to employ their coercive apparatus, that
resolution is legally enforceable—more enforceable in most cases than a court
judgment, thanks to the New York Convention. If a losing party is disappointed

in the outcome of an arbitration, it does not thereby lose faith in arbitration
itself. Although they will fight hard to avoid or minimize a loss, commercial
parties know that an occasional defeat is the price one must pay for access to
arbitration as an effective system of dispute resolution. Such loss of faith might
occur if the arbitrator conducts the proceedings unfairly, but then again
awards that are the product of unfair processes are often unenforceable.
States, too, recognize arbitral authority because it serves their interests.
They see the value that it has for arbitrants and seek to support parties’ freely-
given consent to be bound by arbitration. Like with contractual enforcement
more generally, states benefit from the economic advantages of consistent
enforcement of private agreements. It gives them an opportunity to resolve
disputes while simultaneously reducing court caseloads. With respect to
enforcing foreign arbitral awards, most states willingly do so even if those
awards harm local parties because they acknowledge that a robust network of
international recognition and enforceability benefits commercial parties
everywhere. Just as private parties must accept defeats from time to time,
states see that enforcing an occasional award adverse to one of their nationals
is a price worth paying to be part of the international arbitration system. Those
that fail to appreciate this usually come around, after foreign parties refuse to
do business in those states, or insist upon expensive protections like performance
guarantees so that they can avoid the difficulties of enforcing awards.
Moreover, like with money, recognition of arbitral authority provides
network benefits: the more widespread the network, the more all members of
the network benefit from membership in it. Now that the international
commercial arbitration system is so well-established, with the New York
Convention ratified so widely, states have more to lose by shunning the
network than by joining it.
This account of arbitral authority has deep affinities with HLA Hart’s
conception of legality writ large. Hart famously argues that a core requirement
of any legal system is the existence of a rule of recognition that validates all
other primary (duty-imposing) and secondary (power-conferring) legal rules
recognized within that legal system. For Hart, the rule of recognition is the key
organizing principle that distinguishes legal systems from systems of rules that
are not law. The difficulty with such an account of legality is that it seems to
leave no room to legitimize the rule of recognition itself; as an ultimate rule, it
cannot be legitimized by any other legal rule. Hart’s way out of this difficulty is
essentially sociological: the rule of recognition exists and has force and content
only because of what Hart called “social facts”: its acceptance and use by all
officials of the legal system to identify and validate other legal rules, and its
habitual treatment by members of the community as the authoritative
criterion of legality.
To pre-empt an objection, I should observe that accepting arbitral authority
as a social fact and not as necessitated by any other rule of law is compatible
with the treatment of arbitration as a part of national legal systems, and even
with treating it as a kind of emergent property of the collaboration of multiple,
independent legal systems. Nor does it in any way denigrate arbitral authority
as a ”lesser” form of authority than that of judges. The legitimacy of the entire
legal and governing apparatus of states, very much including the judiciary, also
depends ultimately on social acceptance.
However, recognizing the social character of arbitral authority does reveal
the search for a “source” of that authority to be an ultimately pointless endeavor
(although an intellectually stimulating one). Arbitral authority rests on a
foundation of broad acceptance of that authority, and not on any moral or
instrumental motivating force. There is no exclusively legal, internally legitimizing
principle of arbitral authority.
An important implication of this social account of arbitral authority is that
the justification for recognizing that authority is no more and no less than the
justification for enforcing all private agreements. This essay is not a dissertation
in contract law theory and I will not re-hash those justifications here; there are
both principled and pragmatic reasons to conclude that promises should, in
general, be kept, and that access to a legal remedy should in some circumstances
be available when they are not kept. This is equally true of arbitration agreements
as it is of contracts more generally.
Indeed, while arbitration agreements are routinely described as a specialized
kind of contract, the necessary implications of that status are less widely
recognized. Treating arbitration as a contractual manifestation—not just
arbitration agreements but the entire process—has important implications.
The most direct of these is that awards should be accorded legal effect only to
the extent that they express the intention of the parties as to their agreed
dispute resolution process.
This point may seem obvious to arbitration practitioners, but it tends to
flummox non-lawyers, and even litigators whose experience is limited to
courts. Those unfamiliar with commercial arbitration may be forgiven for seeing
it as an adjunct to the court system; after all, an arbitral proceeding looks a lot
like a trial and an arbitral award looks a lot like a court judgment. But this
initial misconception yields a series of wrong assumptions, in particular that
arbitral awards should be routinely subject to appeal and that arbitral
proceedings should operate according to the rules of civil procedure.
Commercial arbitration has never been part of the legal system at all, let
alone the court system; it has always been a part of the commercial system.
Arbitral awards, in turn, are just the products of contracts that confer decision-
making power upon arbitrators. That is why an arbitral award may not be
annulled or refused enforcement for mistakes of law, but is void if arrived at
by a process different from the one agreed to by the parties. Only the latter
contravenes the parties’ agreement. By opting for arbitration, parties thereby
decide not to pre-select any particular outcome in case of a breach, but rather
to delegate that choice to the arbitrator, so it is impossible for an arbitral award
to contravene the parties’ agreement on the ground that the outcome differs
from the parties’ agreed outcome.
An arbitral award is no different in principle from a price set according to
an objective benchmark that fluctuates over time, such as LIBOR or the price
of Brent Crude. This admittedly counterintuitive analogy becomes clear once
one recalls that contracting parties are free to stipulate remedies in case of a
breach (within certain limits, such as the bar on penalty clauses). Accordingly,
a contract that contains no stipulated remedy provision, or that provides a
remedy only for particular kinds of breaches or in particular circumstances, is
simply the parties’ expression of their intention to rely on the default remedies
applicable under the governing law.
A contract that contains no provision stipulating a dispute resolution
process is the same; it is simply an agreement in which the parties express their
intention to let default rules fill the gap they have left in their contract. This is
a choice many parties rationally make, either because they are satisfied with
the defaults or because it is not worth their time or money to negotiate toward
an alternative. If they do decide to agree upon contingencies that will apply in
case of a breach, they may choose those outcomes directly (a stipulated remedy
provision) or they may choose the process by which those outcomes will later
be determined (a dispute resolution provision).
Price provisions in a contract are the same. Parties may stipulate the price
ex ante or they may instead provide a method for determining the price, either
directly or only in case of disagreement. There is no legally significant difference
if that method involves application of objective benchmarks such as a current
market price, or the decision of a human evaluator. This can be seen in the fact
that, in many legal systems, contracts that leave the price entirely undetermined
are void for lack of definiteness, but the existence of any agreed process for
determining the price, including arbitration, renders the contract valid.
From this perspective, arbitration merely embodies the parties’ agreement
to defer determination of what will happen in case of breach until after the
breach occurs, and to exclusively delegate that determination to a neutral third
party. The authority of the arbitrator is just the freedom of the parties to
provide for a process rather than stipulate an outcome in case certain
contingencies arise (typically, a breach of contract). Therefore, courts should
involve themselves in arbitrations only as much and in the same limited ways
that they involve themselves with contracts more generally: to enforce freely-
agreed contracts, to refuse enforcement of contracts not freely agreed to (such
as those that are the product of unequal bargaining power or where a party
lacked the capacity to agree), to determine the meaning of those contracts in
case of disagreement, to provide a remedy in case of breach (either the remedy
stipulated by the parties or one yielded by application of the default rules), and
to guard against violations of public policy.
Most of the more intrusive arbitration statutes (intrusive from the point of
view of the arbitration community) are premised on a misconception of arbitral
authority as a form of delegated court authority. Instead, arbitration legislation

should forthrightly treat arbitration as the specialized form of contractual
arrangement it is. This would have a variety of implications the arbitration
community will probably like: grounds for non-enforcement of awards limited
to excesses of jurisdiction, failures to abide by fair or agreed processes, and
violations of public policy (the New York Convention grounds), as well as
limited, opt-in-only appeal rights. But the arbitration community must accept
that it also means more robust policing of arbitration agreements for exploitations
of unequal bargaining power, strict application of rules of contractual
interpretation to arbitration agreements (not just reflexive in favorem validatis
interpretations), limited arbitral immunity for negligence, and robust application
of those public policy principles that are relevant to contracts (not just
prohibitions on illegal contracts and corruption, but also antitrust rules and
the preservation of access to a legal remedy). It is not “pro-arbitration” to
blindly enforce contractual provisions that provide the appearance of a dispute
resolution process but whose true purpose is to avoid liability.
The notion that arbitral authority rests only on a continuing act of
collective imagination is disorienting, but no less so for the fact that other
important social institutions, most notably money, rest on the same
foundation. The imaginary character of arbitral authority is a source of
strength, not just fragility.
The fragility is easier to perceive. If arbitral authority requires an act of
belief, it can just as easily be disbelieved. Here, too, the analogy to money is
helpful. Those who insist that an arbitral award is not “real” unless and until
ratified by a court are like “goldbugs,” who reflexively recoil from the idea of
currency untethered to anything of inherent value—typically gold. Calls for
robust court control of arbitral awards come from the same emotional and
intellectual place as calls for restoration of the gold standard—disbelief in a
broadly-accepted social fact. Even if such disbelievers remain a minority, they
can cause continuing trouble.
Moreover, if such disbelief spreads, the effects can quickly spiral into
catastrophe. Above, I described arbitral authority in terms of network effects.
The more widespread a network’s membership, the more value the network
has for all of its members. A related characteristic of networks is their “tippy”
quality. If a particular network succeeds in attracting more adherents, it
generates a virtual cycle in which the market will “tip” toward that network,
cementing its legitimacy and freezing out competitors. But network effects can
also work in reverse, so that exits from the network generate more exits,
leading to collapse. The money equivalent is a run on the banks, which is what
happens when people lose faith in the banking system. Runaway inflation is a
serious problem, but it only becomes a disaster if it leads to a broad loss of faith
in the currency and the banks that preside over it.
It is possible that the international arbitral system could suffer the equivalent
of a run on the banks, in which a few high-profile “failures” of the system lead
to a loss of faith in arbitration that feeds upon itself, and commercial parties
abandon arbitration en masse. Since arbitral authority rests only on broad social
acceptance in the first place, there is nothing to prevent such mass defections.
However, the same social forces that make a collapse of the international
commercial system possible also make it unthinkable outside of a massive
external shock that disrupts the system. Social facts, once established, are self-
perpetuating. It is a characteristic of human psychology that, once people adopt
a narrative that makes sense of the world they see around them, reinforcing
that narrative bolsters their sense of identity, while rejecting it entails a kind
of ego death. Such social narratives are also robust across generational and
institutional turnover. The dissolution of a major arbitral institution or the
repudiation of the New York Convention by a state would do no harm to the
institution of arbitration itself. Indeed, the likely response to such eventualities—
the establishment or expansion of other institutions to fill a gap or worldwide
denunciation of the “rogue” state—would only reinforce the notion that such
events are exceptional, and that acceptance of international commercial
arbitration is the norm.
The lesson for the arbitration community is that being pro-arbitration
means contributing to the collective act of imagining arbitral awards as
authoritative. Each act of faith in the authority of arbitrators acts as a kind of
mantra or catechism; the very repetition reinforces the faith. Each time a losing
party complies with an award voluntarily, each time a court rebuffs a party’s
attempt to wriggle out of an arbitration agreement, each time a legislature
limits grounds for non-enforcement of awards or the availability of appeals to
the courts, the authority of arbitrators becomes a little more real.
Chapter 54
DEREGULATING ARBITRATION MIGHT
ULTIMATELY FAIL TO PROMOTE IT
Juan Manuel Rey Jiménez de Aréchaga*
I. INTRODUCTION
The matter of mandatory rules of the seat and, in general, issues of

delocalization have always been of particular interest to me. When I came to
Prof. Bermann’s class in 2013 as a young arbitration enthusiast, I had the
preconceived notion that if I was to be a real international arbitration practitioner,
I had to believe in a delocalized international system not bound to domestic
rules. “Real” international arbitration had to be detached from “domestic” (i.e.,
“bad”) rules that lacked the sophistication of international rules.
Professor Bermann broke that preconceived notion. I distinctly recall the
class discussion in which I was left with the impression that if we were to
promote arbitration, we needed it to be regulated. A strong international
arbitration community needed clear rules to thrive. And those rules were (at
least in the commercial arbitration setting), by and large, national rules.
The issue was not for naught. In Latin America, arbitration practitioners
tend to discuss whether States A or B’s new regulations infringe on international
arbitration principles. For instance, modifications to the Peruvian Arbitration
Law enacted as an alleged consequence of the instrumentalization of arbitration
proceedings as part of the Lava Jato scheme in Perú have brought criticisms
from many relevant practitioners (and very rightly so). In México, Guatemala
and Colombia, long discussions have been held regarding the applicability of
constitutional remedies such as the amparo or tutela to international arbitration
proceedings and, more particularly, international arbitration awards. The
issue of the interference of constitutional actions in the conduct of international
arbitrations in Latin America is relevant enough to have warranted a recent
study by the Latin American and Iberian Chapters of the ICC Institute of World
Business Law on the matter.
The matter is particularly sensitive when it comes to how courts are seen
by the international arbitration community. Recent decisions by the Argentinean
Federal Supreme Court, where the court reinforced that the grounds of annulment
cannot go into the merits of the case, has been dubbed as “arbitration-friendly.”
The fact that Chilean Courts have never set aside any international arbitration
* Juan Manuel Rey Jiménez de Aréchaga (LL.M. 2014) was Co-President of the Columbia
International Arbitration Association (CIAA), 2013–2014.

307
awards has brought forth comments that the Chilean Judiciary has an arbitration-
friendly approach.
The issue is also global. Jurisdictions have limited the reach of the intervention
of courts in an attempt—as some would claim—to promote arbitration.
Switzerland and Belgium allow for pre-award waiver of annulment proceedings
if there are no Belgian or Swiss-connected parties in the arbitration. France
allows for such waiver regardless of the nationality of the parties. Canadian
courts considered that article 34 of the Model Law (containing the causes for
annulment) was not mandatory.
This brief commentary will not attempt to answer any of these questions.
Rather, this commentary will focus on one particular decision by the Chilean
Judiciary in order to sew in the reader the same kind of intellectual doubts that
Prof. Bermann’s teachings caused in me almost 10 years ago.
II. PARTY AUTONOMY UNLEASHED?
In 2020 the Supreme Court of Chile issued a decision that appeared to be

arbitration friendly due to its respect for party autonomy. On September 14, 2020,
the Court issued a decision on the case CCF SUDAMERICA SPA, Rol Nº 19568-
2020, which essentially accepted that parties could add into their contract
additional appeal mechanisms in international arbitration, effectively casting
a very large—and awkward—shadow on the generally accepted principle of both
previous Chilean court decisions and the very good Chilean International
Arbitration Act that international arbitration awards can only be set aside
through annulment.
The main argument for the Court was the respect for party autonomy in
international arbitration. The Court did not even analyze whether article 34 of
the Chilean Act, which states the grounds for annulment (inspired in article 34
of the Model Law), can be contracted away from (as other Canadian and New
Zealand decisions did). The case was further complicated by the fact that even
though it was, from a legal standpoint, an international arbitration, the parties—
dully represented by counsel—made references to the applicability of domestic
Chilean regulations and not the Chilean International Arbitration Act.
The Court, on its face, issued a decision enshrining the uttermost respect
for something that should be universally celebrated by international arbitration
practitioners, such as party autonomy. But by doing so, it cast a shadow on the
Court’s grasp of relevant international arbitration principles, such as the fact
that awards can only be set aside through annulment actions.
My position on the matter is clear and can be visited in a blog post
published with some of my colleagues titled “The Chilean Supreme Court’s Heart
Is in The Right Place, But Its Arguments Are Not.” That position is not relevant
for the purposes of this brief commentary. What is relevant is to analyze
whether something that is superficially “pro” arbitration, can eventually evolve
into something “anti” arbitration. Two thoughts on the matter.
DEREGULATING ARBITRATION MIGHT ULTIMATELY FAIL TO PROMOTE IT 309
In the first place, Chilean courts have never annulled an arbitration award.
That is a celebrated fact and there are great decisions by the Chilean Judiciary
in which they applied sophisticated international principles to the annulment
proceedings. Chile, as a matter of fact, is considered—and rightly so—as one
of Latin America’s premier arbitration seats. But this decision, if taken in an
isolated manner, could—in the eyes of practitioners not knowledgeable on the
wealth of prior decisions of Chilean Courts—cast doubts on whether Chilean
Courts are actually versed on the matter. At the end of the day, a great record
on annulment could easily be tarnished if, in the future, an annulment is
actually warranted.
At the end of the day, it does not matter whether annulments were issued
or not. What matters is that if annulments were issued, those have to be actually
warranted.
In the second place, the laws and regulations of the seat that are directly
applicable to international arbitrations (and only those) should be applied.
International arbitration does not mean “a-national” arbitration. There is certainly
a good case in saying that the current system of enforcement of international
arbitration awards is based upon the notion that arbitration awards are seated
in specific countries and that choice of a seat has consequences (without that
meaning the subversion of an international arbitration to domestic issues that
do not apply to international arbitrations).
By ignoring article 34, it could be argued that the Chilean Supreme Court
did itself and its really good track record a disservice.
III. CONCLUSION
It is not my intention—nor it should be—to provide an answer to this

issue. I only intend to pay a small homage to the quintessential doubt that Prof.
Bermann sowed in me and that, to a large extent, made me the international
arbitration practitioner I am today.
Chapter 55
THE IMPORTANCE OF ASPIRATIONAL
STANDARDS OF CIVILITY IN INTERNATIONAL
PROCEEDINGS
Julie Bédard and Nicholas Romanoff*
It is our pleasure to submit this essay in appreciation of George, whose

thought leadership on the challenges facing international arbitration law has
been formative for us both. We devote this contribution to the importance of
standards of civility in international arbitration. The subject is most fitting for
a tribute to George, who in his work outside the academy reminds us that
“[a]ll” participants in international arbitrations “are the front-line actors in
ensuring the integrity of the process” and, by extension, the legal system’s
legitimacy.1
As a general moral principle, civility requires the treatment of others with
courtesy, politeness, dignity, and respect. When discussed in the context of
adjudication, civility is also often associated with principles such as fairness,
diligence, cooperation, restraint, and candor.
Our community’s recent interest in standards of civility has emerged as
part of a larger conversation about morality and ethics in international
arbitration, which has been spurred by a perceived rise in bad faith conduct
and disrespectful behavior in proceedings. In a 2011 survey of international
arbitrators and counsel, 68% of respondents said they had seen what they
viewed as “guerilla tactics” in proceedings. Their examples ranged widely, and
* Julie Bédard is Head of Skadden’s International Litigation and Arbitration Group for the
Americas. Fluent in English, French, Spanish and Portuguese, Ms. Bédard practices in four
languages in complex disputes and investigations. Trained in both civil and common law, Ms.
Bédard has a doctorate in conflicts of antitrust and securities regulation and represents clients
in litigation, arbitration and regulatory proceedings throughout the world. A two-time graduate
of the Columbia University School of Law, she served as co-editor of Reflections on International
Arbitration: Essays in Honour of Professor George Bermann, which was published in 2022.
Nicholas Romanoff is a First Year in Skadden’s New York office, working in the firm’s
International Arbitration and Litigation Group. A 2022 Columbia University School of Law
graduate, he developed his passion for cross-border dispute resolution as a student of George
Bermann, who advised on the publication of Mr. Romanoff’s note titled “The ‘Bedrock Principle’
That Wasn’t: Alliance for Open Society II and the Future of the Noncitizens’ Extraterritorial
Constitution,” which was published in the Columbia Human Rights Law Review.
1 Opinion of Professor George A. Bermann, para 187 (Jan. 17, 2021), Anatolie Stati, Gabriel
Stati, Ascom Group SA and Terra Raf Trans Trading Ltd v. Republic of Kazakhstan, SCC Case No.
116/2010. See also Sophie Nappert, “Twenty-First Century Arbitration: The Question of Trust,”
in REFLECTIONS ON INTERNATIONAL ARBITRATION: ESSAYS IN HONOUR OF PROFESSOR GEORGE BERMANN 275–
76 (eds. Julie Bédard & Patrick W. Pearsall 2022).
311
included last-minute document production; excessive requests for disclosure;

lack of candor in representing a client’s availability or one’s own health in order
to delay hearings; changing counsel during proceedings to have an arbitrator
disqualified; initiation of frivolous satellite proceedings for anti-arbitration
injunctions; initiation of criminal actions against an adverse party’s officers or
counsel; witness tampering; and a general lack of respect or courtesy towards
the tribunal and opposing counsel.2
While highly fact-dependent, some of this conduct could, in some
circumstances, subject counsel to sanctions under the ethical rules applicable
to them in their specific arbitration. In international arbitration proceedings,
lawyers may be subject to the local ethics rules of their licensing jurisdiction,
those of another jurisdiction, or, if the parties have so agreed, by a set of
international soft law rules designed for international arbitration.3 In each of
these cases, the ethics rules and their enforcement mechanisms proscribe a
baseline of ethical conduct by which a lawyer must abide.
The most egregious forms of “guerilla tactics” in international proceedings—
misconduct that, if undiscovered or uncorrected, would seriously tip the scales of
justice in one party’s favor—include actions that may have severe consequences,
such as sanctioning of a lawyer under ethics rules (domestic or international);
risks for an award’s finality; violation of criminal law; and, when committed on
behalf of a State, violation of that State’s treaty obligations.
Standards of civility present an altogether different tenor of conversation,
which can implicate a far broader universe of attorney conduct. Civility involves
so many broad, interrelated moral and ethical principles, and it is helpful for
understanding the exercise of elevating the standards of civility in a legal
community, to look to an October 1997 essay by former Chief Justice of the
New York Court of Appeals Judith S. Kaye for guidance:
The question is not whether we really need a civility code. I believe the
need has been amply established by what we ourselves see on a daily
basis, by the dozens of jurisdictions that have adopted civility codes, and
by the numerous bar association studies, surveys and reports . . .
identifying lack of common courtesy as a pervasive problem today. Nor
do I believe that we should be asking whether civility standards can
really make any significant difference, given the absence of penalties and
enforcement mechanisms. The intention was to upgrade and assure
everyday professional behavior, not create another arena for contention
and litigation.4
2 Edna Sussman & Solomon Ebere, All’s Fair in Love and War—Or Is it? Reflections on Ethical
Standards for Counsel in International Arbitration, 22 AM. REV. INT’L ARB. 611, 612, 613–15 (2011).
3 See generally, International Bar Association, Guidelines on Party Representations (2013).
See also LCIA Arbitration Rules (2014), Arts. 18.5–18.6 (“General Guidelines for the Parties’
Legal Representatives”).
4 Judith S. Kaye, “How Do We Make the Standards of Civility Work?” reprinted in New York
State Unified Court System, “Standards of Civility” (Oct. 1997).

THE IMPORTANCE OF ASPIRATIONAL STANDARDS OF CIVILITY 313
Chief Justice Kaye taught us that, even though an attorney may often run
afoul of the civility expected of them by others in their community without
risking sanctions, we should nevertheless be bold in our aspirations to elevate
our legal community’s civility and professionalism. There is good reason to
follow her model of identifying and enshrining the aspirational ethical standards
in our legal community. We should not be deterred by the prospect that
enumeration of our ethical expectations may provide fodder for additional bad
faith behavior (a charge often levied at the IBA Guidelines on Conflicts of
Interest in International Arbitration). There is no place for such cynicism in the
context of aspirational civility standards.
In general, moral standards in adjudication cannot be one-size fits all because
the moral decisions we make arise in highly specific factual contexts. Nor can
such standards be considered in a vacuum: in some scenarios, mandatory
ethics rules, including the duty of zealous advocacy, may require actions that
are at odds with the general principles of civility expected in the legal system.
In international adjudication, these difficulties are further compounded by the
diversity of participants’ backgrounds, exacerbating the peculiarity, variance,
and sometimes contradiction in the way we approach and decide what we
consider to be proper or ethical.
For these reasons, Co-Chairs of the ICCA Task Force on Standards of
Practice in International Arbitration Abby Cohen Smutny and Prof. Dr. Guido
Santiago Tawil, along with the other Task Force Members, deserve recognition
for all that they have achieved with their Guidelines on Standards of Practice.5
The Task Force aimed, in Ms. Smutny’s words, to “assess whether there is a
certain consensus already as to what it means when we speak or standard of
conduct . . . of our practice.”6 To this end, a diverse team of experts surveyed
professional standards, ethical rules, and civility guidelines from a wide range
of jurisdictions, identifying widespread consensus on a number of general
principles of civility, memorialized in the Guidelines. Notably, the ICSID and
UNCITRAL Secretariats have already relied on the ICCA Guidelines to give
content to “civility” and “professionalism” requirements in their most recent
draft codes of conduct for arbitrators for Working Group III.7 Their embrace of
the Guidelines confirms that they capture general standards of civility expected
in international proceedings, and specifically confirms their relevance to investor-
state dispute resolution.
In substance, the Guidelines reveal a widespread expectation of broad
standards of civility and professionalism in international arbitration. All
participants are expected to “act with integrity, respect, and civility vis-à-vis
5 The ICCA Reports, No. 9 (2021).

6 “Does the international arbitration community need minimum civility standards?”
International Law Talk: A Wolters Kluwer podcast (Jan. 28, 2021).
7 See UNCITRAL Working Group III, Possible reform of investor-State dispute settlement
(ISDS) Draft Codes of Conduct and Commentary (Nov. 23, 2022), A/CN.9/WG.III/WP.233,
commentary to article A6; id. n.12.
other participants” (I.A); to “refrain from any form of discriminatory conduct”

(I.B); to “act in order to ensure that international arbitration remains a timely
and cost effective means of dispute resolution” (I.C); and to “respect the rights
of parties and non-parties to privacy and confidentiality” (I.D). In addition,
counsel are also expected to “act cooperatively with one another and the arbitral
tribunal” (II.A); to “not act offensively . . . towards any of the participants” (II.B); to
“not knowingly make any false submission of fact” (II.C); and to “not engage,
without legitimate reasons, in activities intended to obstruct, delay, or disrupt
the arbitration process or to jeopardize the finality of any award” (II.D).
The standards require that participants in international proceedings treat
each other with respect and cooperate in good faith in situations where such
conduct benefits the community as a whole, but where apathy may not always
carry a penalty. For example, Explanatory Comments to Guidelines I.B and II.A,
respectively, remind us all to “be aware and respectful of all forms of diversity
that exist in the arbitral community, as well as the risk of unconscious bias,” and
that cooperation between counsel may require “accommodations for language,
cultural, and/or religious differences as well as for different time zones . . . .”
Clearly, there is no place for any discriminatory remarks or resistance to cross-
cultural accommodations in an industry that is specifically devoted to the
resolution of cross-border disputes. That said, surely some counsel have, and
will again, lapse in their cross-cultural sensitivity without facing repercussions.
As a community, one of our missions with this category of ethical expectations
is thus to be aspirational in our moral commitments, bearing in mind that we
are the embodiment of international arbitration as a system of rule of law, and
that our civility preserves its legitimacy.
Another task we face here is to internalize the ways in which civil conduct
benefits both clients and ourselves in addition to serving the more existential
interests of our industry. First, courteous, respectful advocacy and cooperation
with an adjudicator’s orders is often the most effective advocacy, improving a
client’s prospects of success and one’s own reputation as an attorney. Second,
cooperation with opposing counsel on procedural matters can reduce the time
and expense of dispute resolution, which both benefits current clients and is
consistent with how international arbitration is often advertised to prospective
clients. Third, adjudication is just one tool to achieve peace between disputing
parties, and a lack of civility can jeopardize the atmosphere needed for the
possibility that others, such as a return to mediation or settlement negotiations,
will succeed. Finally, civil, professional behavior reinforces the belief that ours
is a noble profession, which if genuinely held will tend to promote our own
enjoyment of legal practice, while also avoiding the added stress that incivility
can contribute to our mental health.
Much of our community’s discourse on civility and professionalism has
instead been focused on behavior that clashes with our community’s ethical
expectations, but which, from an offending counsel’s perspective, may be justified
by their duty to zealously promote their client’s interests. In the context of
THE IMPORTANCE OF ASPIRATIONAL STANDARDS OF CIVILITY 315
domestic litigation, calls for increased civility often discuss this tension in
connection with whether, and when, an aggressive cross-examination may be
required to elicit an emotional response from a witness that benefits one’s client.
In the context of international arbitration, many have noted a much broader
array of conduct: the “guerilla tactics” described above. The propriety of these
alleged “guerilla tactics” can be difficult to assess in global terms, as the specific
facts and the applicable ethical rules may justify some of these actions in some
circumstances. For this very reason, the ICAA Guidelines were written to avoid
this tension. (See Explanatory Comments II.B, II.D). To an extent, their silence
on these matters necessarily flows from a lack of consensus in the community.
That said, we as individual participants in international proceedings still
have important roles to play in connection with this sort of conduct. In our own
advocacy, we might recognize that some situations seemingly permitting “guerilla
tactics” may in fact be better classified as situations where civil conduct is in
one’s own interest: for instance, because ethically suspect advocacy often
backfires by reducing one’s credibility with a tribunal to a client’s detriment.
In navigating these lines, we must also keep in mind the systemic interests
of our industry: delay tactics both undercut the advertised efficiency of
international arbitration as a dispute resolution mechanism and burden
arbitrators’ time, which may further delay their other cases. Similarly, frivolous
satellite litigation in cases poses a distinct concern, insofar as it undermines the
New York Convention, the fundamental currency of international arbitration.
The future leaders of our field—distinguished arbitrators, counsel, experts,
and scholars alike—will someday be drawn from the recent law school graduates
who are joining our field today. If present trends persist, when these future
lawyers take the mantle our industry will be larger and more competitive than
it is today. At the same time, deglobalization and great power conflict may pose
new obstacles to civility in international proceedings. With these prospects in
mind, the posterity of today’s systems of international adjudication require
that senior attorneys and arbitrators both model and teach civility. And through
all our efforts to actualize aspirational standards of civility, and to define the
zone of civil conduct that does not clash with zealous advocacy expansively,
we can collectively foster an environment that both discourages egregious acts
of incivility, improves our own experience, and preserves the legitimacy of our
profession.
Chapter 56
WAIVER OF THE RIGHT TO ARBITRATE—
IS U.S. LAW “PRO-ARBITRATION”?
Katharine Menéndez de la Cuesta*
This essay is written in honor of Professor George A. Bermann, the beloved

professor of international arbitration at Columbia University School of Law in
New York. Among the many things Professor Bermann has taught us, one in
particular has stayed with me. We learned that being “pro-arbitration” does
not mean arbitration wins in every circumstance and at all costs. In his own
words, “giving effect to [fundamental society] values and securing the legitimacy
that confers may, even when doing so fails to advance a narrowly pro-arbitration
agenda, be the most pro-arbitration move one may make.” George A. Bermann,
What Does It Mean to Be “Pro-Arbitration”?, 34 ARB. INT’L 341 (2018).
This essay addresses the most recent change to U.S. law on the waiver of
the right to arbitrate, namely, the U.S. Supreme Court’s decision that a showing
of prejudice is no longer required to find waiver, and explores whether that
change may or may not be pro-arbitration.
* * *
International arbitration practitioners often categorize a policy, a decision,
or a piece of legislation as pro or anti-arbitration; seats compete on their
“arbitration friendliness;” and arbitration users prefer a “pro-arbitration” setting,
whatever that may mean. In the U.S., a “liberal national policy favoring arbitration”
has been in place for decades.
Typically, when a dispute arises between two signatories to an arbitration
agreement, the claimant will initiate arbitration under the agreed rules. As a
result, an arbitrator or arbitral tribunal will eventually issue an award resolving
the parties’ dispute absent a voluntary settlement.
In a less common scenario, the claimant will not commence an arbitration
request but initiate litigation in court, ignoring the parties’ arbitration agreement.
In this conjuncture, the Federal Arbitration Act (FAA) entitles the defendant to
compel the plaintiff to arbitrate.
But sometimes defendants do not invoke the arbitration agreement right
away. They instead join the plaintiff in court and engage in litigation, before
changing course and invoking their right to arbitrate. Should a defendant be
allowed to switch to arbitration at a later time? What elements should be
established for the court to find the defendant waived its right to arbitrate and
must continue to litigate the dispute?
* Katharine Menéndez de la Cuesta (‘14 LL.M., ‘16 J.D.) is a Partner at Holland & Knight LLP.
317
Until recently, under the test followed by a majority of circuits with slight
variations, a party waived its right to arbitrate if it (i) knew of the right;
(ii) “acted inconsistently with that right;” and (iii) “prejudiced the other party
by its inconsistent actions.” Morgan v. Sundance, Inc., 142 S. Ct. 1708, 1712 (2022).
A few circuits did not treat prejudice as a mandatory element in the analysis,
but rather as a relevant factor among the circumstances to find waiver.
Notably, prejudice was not required to find waiver of any other contractual
right, but only the contractual right to arbitrate.
The analysis is not different for international arbitration matters, where
U.S. courts have consistently considered prejudice in their analysis to find
waiver. See the Restatement of the Law, the U.S. Law of International Commercial
and Investor-State Arbitration (Restatement), § 2.20, Reporters’ n. b (May 20,
2019). (The Restatement adopted the position that prejudice should not be
required as an element to assert waiver in international arbitration. Restatement,
§ 2.20).
But in May 2022, in a domestic labor and employment dispute, the U.S.
Supreme Court decided the prejudice requirement was inconsistent with the
U.S. “liberal national policy favoring arbitration.” Morgan at 1709. In deciding
whether a party who tardily invokes its right to arbitrate waived it, the Court
held the test must exclusively focus on whether the party “knowingly
relinquished” the right by “acting inconsistently” with it. Id.
Is the U.S. Supreme Court’s holding anti- or pro-arbitration? Among the
several factors that may be examined to determine whether a policy, a law, or
a practice is anti- or pro-arbitration, the following may be useful here:
• Does the holding ensure consent to arbitrate and promote party

autonomy?
• Does the holding render arbitration economical in terms of time and cost?
• Does the holding effectuate the likely intentions or expectations of the
parties?
• Does the holding minimize the intervention of national courts in the
arbitral process?
See the above and other factors in Bermann, supra, 343.

The holding may be perceived, at first, as being “anti-arbitration.” After all,
the right to arbitrate seems to be weaker now because it is more easily
waivable under U.S. law than it was before. In the Morgan opinion the U.S.
Supreme Court found that prejudice should not be required because the U.S.
policy favoring arbitration is about “treating arbitration contracts like all
others, not about fostering arbitration.” Morgan at 6. Isn’t it the case then that
requiring prejudice to find waiver fosters arbitration and, conversely, the
current law undermines it?
WAIVER OF THE RIGHT TO ARBITRATE—IS U.S. LAW “PRO-ARBITRATION”? 319
Sundance, together with some of the organizations that filed amicus briefs
in support of its position, argued that removing prejudice as a requirement to
find waiver would be anti-arbitration for various reasons.
First, section 3 of the FAA states that litigation must be stayed when the
dispute is subject to arbitration under an arbitration agreement provided that
the compelling party “is not in default in proceeding with such arbitration.”
FAA, § 3.
Sundance argued that an implied waiver based on conduct that caused no
prejudice could not amount to a default. This is because section 3 of the FAA
provides “a clear, pro-arbitration direction to courts,” while allowing waiver
without prejudice would create a “use-it-as-expeditiously-as-you-can-or-lose-
it” rule that “systematically favors litigation,” an example of the anti-arbitration
conduct the federal liberal policy favoring arbitration protects against. Brief for
Sundance, pp. 11, 49.
Similarly, the Chamber of Commerce of the United States of America argued
in its amicus brief that a party’s “inconsequential delay” cannot result in that party
being in default absent prejudice. In the Chamber’s words, “an inconsequential
delay is thus insufficient to trigger the permanent loss of that important right
[to arbitration].” Brief for the Chamber of Commerce of the United States of
America as Amicus Curiae in Support of Respondent, p. 8.
Second, section 2 of the FAA requires courts to enforce an arbitration
agreement “save upon such grounds as exist at law or in equity for the
revocation of any contract.” FAA, § 2. Sundance argued this instruction does not
impose a strict rule to treat arbitration agreements and other contracts equally.
Rather, section 2 of the FAA would adopt a “most-favored-nation” approach to
arbitration where “as long as arbitration agreements are enforced at least as
favorably as other contracts, section 2 is not offended.” Brief for Respondent,
p. 29.
Third, Sundance argued that litigating the case without immediately
moving to compel arbitration would not necessarily amount to gamesmanship
because courts have already held that gamesmanship, including the waste of
judicial resources, is grounds for finding prejudice. Brief for Respondent, p. 44.
The U.S. Chamber of Commerce concurred, alleging that because gamesmanship
has been considered a type of prejudice, removing prejudice from the analysis
would eliminate a barrier against gamesmanship and, therefore, weaken the right
to arbitrate. See U.S. Chamber of Commerce’s Amicus Brief, pp. 23–25.
Fourth, absent a clear requirement of prejudice, the standard may be
unclear and too subjective. Requiring knowledge of the arbitration agreement
and inconsistent conduct with that right would, for some, leave the analysis in
“ill-defined,” “unpredictable,” or “amorphous” land. U.S. Chamber of Commerce’s
Amicus Brief, p. 3. Absent a prejudice requirement, the standard would invite
the “hostility to arbitration” that we want to “combat” in the U.S. Id. (citing
Kindred Nursing Ctrs. Ltd. P’ship v. Clark 1421, 1428 (2017) (internal quotations
omitted)).
Morgan disagreed along with other organizations and law professors

(including Professor Bermann) who filed amici briefs in her support. Maybe
because the lower courts, as well as Sundance, have so heavily relied on the so-
called U.S. liberal policy favoring arbitration to require prejudice, Morgan
argued that removing prejudice from the arbitration waiver analysis was, in
fact, a pro-arbitration move.
First, the FAA’s goal “was to make arbitration agreements as enforceable
as other contracts, but not more so.” Prima Paint Corp. v. Flood & Conklin Mfg. Co.,
388 U.S. 395, 404 n.12 (1967). This was the argument on which the Supreme
Court ultimately based its holding in Morgan. Why is this stance pro-arbitration?
Requiring prejudice to find waiver encourages parties to initially disregard
their arbitration agreements and resort to them only when they believe the
court avenue no longer works. Under an apparent strengthening of the right to
arbitrate, which would become less easily waivable, the prejudice requirement
seems to make arbitration agreements more resistant to the parties’ ability to
neglect them and only invoke them when it is convenient. This cannot be a pro-
arbitration approach.
Second, it does not seem that finding waiver of the right to arbitrate only
when prejudice is present makes arbitration particularly economical in terms
of cost or time, especially because the time and cost parties have incurred
litigating the very same dispute subject to arbitration are not necessarily
considered to find prejudice. The FAA policy favoring arbitration is supposed
to make “the arbitration procedure, when selected by the parties to a contract,
[…] speedy and not subject to delay and obstruction in the courts.” Prima Paint
at 404. But as explained by over 30 law professors in support of Ms. Morgan,
“injecting a prejudice requirement into the waiver analysis turns these
objectives on their head.” Brief of Amici Curiae Law Professors in Support of
Ms. Morgan, p. 13.
Third, the FAA policy “favoring arbitration,” and section 2 in particular,
have consistently been interpreted by the U.S. Supreme Court as requiring
arbitration agreements to be placed “upon the same footing as other contracts.”
Scherk v. Alberto-Culver Co., 417 U.S. 506, 511 (1974). It is difficult to see how
section 2 does not embody an equal-treatment principle which bars an
arbitration-specific approach requiring a finding of prejudice to establish
waiver when such finding is not required for any other contract.
Fourth, not requiring a showing of prejudice in finding waiver avoids
gamesmanship because it encourages the compelling party to treat the arbitration
agreement with the significance it requires, rather than displacing it to a
secondary right only used or invoked if things do not go to court as desired.
Arbitration is supposed to avoid litigation and not be used as a fallback
position when litigation does not go as anticipated. Arbitration was never
meant to be the second bite at the apple after litigation, but an alternative to
litigation. A thesis that maximizes the intervention of national courts rather
than minimizing it cannot be pro-arbitration.
WAIVER OF THE RIGHT TO ARBITRATE—IS U.S. LAW “PRO-ARBITRATION”? 321
Fifth, requiring a showing of prejudice in finding waiver is arguably

inconsistent with the parties’ expectations when they agreed to arbitrate,
rather than litigate, because it allows parties to slow down the resolution of
the dispute. Because the current U.S. law on waiver encourages parties to
resolve the dispute more efficiently, it effectuates the likely intentions of the
parties when they agreed to arbitrate, making the U.S. Supreme Court’s holding
in Morgan pro-arbitration.
Sixth, arbitration is a matter of consent and requiring prejudice to find
waiver does not seem to particularly enhance or foster this cornerstone
arbitration requirement. The party to an arbitration agreement that initiates
litigation arguably breached its obligation to arbitrate. When the other party
follows suit and engages in substantive litigation, knowingly relinquishing its
right to arbitrate, consent has vanished. How could adding an additional
requirement to find waiver—prejudice— restore this consent?
And last but not least, although in some cases the wait may be justified,
most of the reasons for a party to wait to compel arbitration seem to be anti-
arbitration. Maybe the party is unaware of the arbitration agreement, but this
is not a strong argument to treat the right to arbitrate differently from other
contracts, and the federal rules of civil procedure already offer tools in this
scenario when justified. Sundance and the Restaurant Law Center, in its amicus
brief, argued a few reasons for this delay in compelling arbitration, such as
exploring a settlement, litigating preliminary motions, or conducting limited
discovery. But some of these procedural steps or tools are not incompatible
with arbitration and, if they are and it was the parties’ expectation to have
them, then the parties should not have agreed to arbitration as a mechanism
to resolve disputes in the first place. A pro-arbitration approach cannot consist
of making arbitration a second-class right to which parties only resort after
engaging in litigation. Further, it seems unfair that parties proceed to litigate
the case under rules of civil procedure and evidence they never agreed to, to
only later have the case referred to arbitration. Arbitration is the mechanism
the parties chose to avoid litigation.
In sum, it seems the Supreme Court’s decision in Morgan, which removes
the need to show prejudice to find waiver of arbitration agreements, places
such agreements on equal footing as any other contract, barring conduct that
would relegate them to a fallback position. It also avoids gamesmanship, and
encourages parties to arbitration agreements to treat arbitration as the
preferred mechanism over litigation. If consent to arbitration is no longer present
in either party, then parties may proceed to litigate the dispute. But after Morgan,
if a party wants to hold the other to their arbitration bargain, it must do so as
soon as practicable under the circumstances.
Chapter 57
WHAT IS IT TO BE “PRO-ARBITRATION” WHEN
ADDRESSING CORRUPTION AT THE SETTING
ASIDE AND ENFORCEMENT STAGES?
Laura Azaria and Vincent Reynaud*
In the last 25 years, an international consensus has emerged condemning

corruption (defined for the purposes of this essay as encompassing bribery,
money laundering and influence peddling) as a legally and morally repugnant
practice that maintains poverty, stalls development, rewards unsavory conduct,
and distorts fair and free competition. The plentiful literature on corruption is
a testament not only to the unfortunate reality that corruption occurs all too
often but that it is an issue to be tackled. Arbitral tribunals are no strangers to
this scourge, which they frequently face both in commercial and investment
disputes.
Corruption brings to the fore two competing “pro-arbitration” values:
respecting the finality of arbitral awards, on the one hand, and policing a public
policy concern, namely the fight against corruption, on the other. In Professor
Bermann’s words, to which extent does favoring one relative to the other
“serve and disserve arbitration’s interests”? (George A. Bermann, What Does it
Mean to Be “Pro-Arbitration”?, 34 Arb. Int’l 341, 2018, p. 348).
The tension between these values is highlighted in Article V.2(b) of the
New York Convention on the Recognition and Enforcement of Foreign Arbitral
Awards (NY Convention) and Article 36(b)(ii) of the UNCITRAL Model Law
whereby a court may—not must—set aside or refuse enforcement of an arbitral
award if a party establishes that recognition would be contrary to public policy.
More particularly, when a court is asked to set aside or refuse enforcement of
an award because it allegedly upholds a contract tainted by corruption, two
issues pertaining to judicial scrutiny of awards arise:
(i) whether courts ought to defer to arbitral tribunals’ findings on corruption.

Should a court take an arbitral tribunal’s findings at face value, or
should it investigate further and rule on the existence of corruption?
And, in the latter case, to what extent?
* Laura Azaria is Counsel at LALIVE specializing in international commercial arbitration.
Laura also represents parties in arbitration-related court proceedings, especially relating to the
setting aside of international awards before the Swiss Federal Supreme Court. Vincent Reynaud
is an Associate at LALIVE specializing in international commercial and investment arbitration.
Vincent also regularly advises international organizations on governance and institutional
matters as well as on their privileges and immunities.
323
(ii) whether, if corruption is established, it warrants setting aside or refusing

enforcement of the award on public policy grounds.
Two differing approaches emerge from how courts tackle these issues. A
minimal standard of review in which courts exhibit a great degree of deference
to the findings made by the arbitral tribunal and thereby the finality of the
award. A maximal standard of review in which courts proceed to a scrutiny of
all matters of fact and law—even beyond those in the arbitration proceedings—
to ensure that recognition of the award is not inapposite to the public policy
against corruption.
Each of these two approaches serves arbitration’s purposes in one respect
but disserves them in others, thereby illustrating the tension between arbitral
awards’ finality and anti-corruption public policy. Issuing an enforceable award
is undoubtedly among the arbitrator’s four primary obligations together with
accuracy, fairness and accountability—or the “four musketeers of arbitral duty”
as Professor Park calls them (see Les devoirs de l’arbitre: ni un pour tous, ni tous
pour un, 2001 Cahiers de l’Arbitrage 13 / Int’l Chamber of Commerce, 2011).
But how does fighting corruption relate to being “pro-arbitration”? Arbitration’s
legitimacy largely flows from the NY Convention through which 169 States
have formally recognized it as a mechanism for administering justice. With such
privileges come responsibilities. If one accepts the existence of an international
consensus to fight corruption, ensuring that arbitration is not a conduit for
corrupt practices when administering justice is crucial.
Yet, which of these two approaches is in practice more “pro-arbitration”?
Finding a suitable balance between these two “pro-arbitration” values is not
only a challenge for arbitral tribunals, but also for judicial courts. To shed light
on this tension, and address the pros and cons of both approaches, we rely on
Alexander Brothers Ltd. (ABL) v. Alstom Transport SA and Alstom Network UK
Ltd. (Alstom) that saw the Swiss Supreme Court display a minimal review
approach and the French courts adopt a maximal review approach.
I. SWITZERLAND
Alstom Transport SA and Alstom Network U.K. Ltd (Alstom) signed three
consultancy agreements with Alexander Brothers Limited (ABL), whereby ABL
was to assist Alstom with the submission of three tenders for the supply of
railway equipment in China. Despite Alstom having been awarded all three
contracts, it paid only a portion of the amount due for ABL’s consultancy services.
In 2013, ABL initiated a Geneva-seated ICC arbitration against Alstom, claiming
the balance of the invoices was allegedly due. Alstom refused to pay, contending
that ABL breached the compliance and ethical obligations in the consultancy
agreements, which raised suspicions about ABL having paid bribes. Moreover,
ongoing investigations by the U.S. Department of Justice and the British Serious
Fraud Office might expose Alstom to heavy fines if it were to pay ABL. In its
WHAT IS IT TO BE “PRO-ARBITRATION” WHEN ADDRESSING CORRUPTION 325
award issued in January 2016, the Arbitral Tribunal concluded that corruption
was not established—mere suspicions failed to meet the high standard of proof
required—and ordered Alstom to pay ABL almost EUR 1.5 million plus interest.
Alstom unsuccessfully attempted to set aside the ICC award before the Swiss
Supreme Court. In its decision rendered in November 2016 (4A_136/2016),
the Swiss Supreme Court reiterated that corrupt practices or the existence of
a corruption scheme may, in principle, justify setting aside an international
arbitral award for violation of public policy (Art. 190(2)(e) Swiss Private
International Law Act, “PILA”). However, it is for the arbitral tribunal to establish
corruption: its assessment cannot be reviewed by the Swiss Supreme Court unless
the taking of evidence itself violates due process or public policy requirements.
The Swiss Supreme Court held that ordering Alstom to pay ABL for the
balance of the invoices did not violate public policy since the Arbitral Tribunal
had found that Alstom failed to establish any corruption. The Court stated that the
party claiming corruption must prove its claim by providing concrete evidence.
It further stated that to establish a violation of public policy, not only must
corruption be proven but the arbitral tribunal must have refused to address the
issue in its award, which in the Court’s view was not the case here. The Court
further held that internal anti-corruption and compliance rules of a private
entity were irrelevant to determining a violation of Swiss public policy.
Alstom and the more recent case law of the Swiss Supreme Court on
disputes involving corruption allegations (see, for e.g., Swiss Supreme Court
decision 4A_50/2017 dated 11 July 2017) exemplify the general position of
Swiss arbitration law, whereby a lot of deference is given to arbitral tribunals
and the Swiss Supreme Court’s review is essentially curtailed to ensuring
compliance with fundamental procedural guarantees. In fact, the overall chances
of success of a challenge on the ground of violation of public policy amounts to
only 0.9% (Felix Dasser / Piotr Wójtowicz, Swiss International Arbitral Awards
Before the Federal Supreme Court. Statistical Data 1989-2019, in ASA Bulletin
1/2021, p. 19). The proceedings may nevertheless be reopened by means of
revision if new relevant evidence is discovered after the termination of the
arbitration proceedings or if there are indications that the award was influenced
by criminal conduct (Art. 190a PILA).
II. FRANCE
In France, the main ground to set aside or challenge the recognition and
enforcement of an award in which the underlying contract is allegedly tainted
by corruption is to show that enforcement would be contrary to international
public policy (Arts. 1514 and 1520.5 French Code of Civil Procedure).
In the past eight years, there has been a definite shift in the position of
French courts from the minimal standard of review to the maximal one (Gulf
Leaders v. CFF, Paris, 4 March 2014). This shift has been both lauded and
deplored by academics and practitioners who would doubtlessly label themselves

“pro-arbitration.”
Previously, where corruption was raised, French courts’ review was “limited”
to assessing whether there was a “flagrant, effective and tangible” violation of
international public policy—without looking beyond the elements of law and
fact contained in the award and arbitration proceedings, and they did not revisit
the arbitral tribunal’s findings (Paris, Thales Air Défense v. GIE Euromissile,
18 November 2004; Court of Cassation, SNF v. Cytec, 4 June 2008). Put simply,
an award would be set aside or not recognized if a violation of international
public policy was evident, without the courts exercising any thorough review
(Christophe Seraglini, Le contrôle par le juge de l’absence de contrariété de la
sentence à l’ordre public international: le passé, le présent, le futur, 2 Rev. Arb.
347, 2020, p. 353, § 10).
The Alstom case is arguably the culmination of French courts’ shift toward
a maximal standard of review. Alstom sought to challenge the enforcement of
the ICC award before the Paris Court of Appeal, which refused enforcement on
public policy grounds. As explained by the Court of Appeal, the object of its
review was whether recognition and enforcement of the award would result
in a “manifest, effective and tangible” violation of international public policy
by, in one way or another, rewarding corrupt practices. As such, the Court of
Appeal stated that whether a party had failed to argue corruption before the
arbitral tribunal (even in bad faith) was irrelevant (Alstom v. ABL, Paris, 28 May
2019).
The Court of Appeal’s review encompassed all elements of law and fact—
not simply those raised in the arbitration as shown by its order to Alstom to
produce evidence under threat of monetary penalties (astreinte). The Court
insisted that its review did not, however, entail assessing the performance of
contractual obligations, or determining the parties’ criminal liability for corrupt
practices.
In carrying out its review, the Court of Appeal applied a standard of proof
purposefully adapted to account for the inherent difficulties in establishing
corruption, which is met where there is a “serious, specific and consistent body
of circumstantial evidence” (“faisceau d’indices graves, précis et concordants”).
On 29 September 2021, the Court of Cassation annulled the judgment by
the Court of Appeal, finding that the latter had distorted part of the evidence
when establishing corruption (now remanded to the Versailles Court of Appeal)
but did not opine or challenge the scope and extent of the review, which has
been consistently endorsed in the Court of Appeal’s case law (see e.g., Sheikh
Faisal v. CFF, Paris, 30 June 2020; Libya v. Sorelec, Paris, 17 November 2020).
The Court of Cassation approved the scope and extent of review in the Court of
Appeal’s case law on 23 March 2022 in Belokon v. Kyrgyzstan, arguably setting
a standard of review of “characterized breach of international public policy"
(“[violation] caractérisée [de] l’ordre public international”) broader than the
“manifest, effective and tangible” one.
WHAT IS IT TO BE “PRO-ARBITRATION” WHEN ADDRESSING CORRUPTION 327
The reasons for this “maximal” review are hinted at in the Court of Appeal’s
judgments. The policy against corruption forms part of an “international
consensus” reflected in the OECD Convention on Combating Bribery of Foreign
Public Officials in International Business Transactions of 1999 and the United
Nations Convention against Corruption of 2003. The “French conception”
(“conception française”) of international public policy espouses this consensus;
as such, the French legal order cannot entertain the facilitation of payments
tied to corrupt practices. In effect, this means French courts will uphold the
international public policy against corruption even where it has little or no ties
to France.
III. MINIMAL VS. MAXIMAL REVIEW: WHICH ONE IS MORE “PRO-

ARBITRATION”?
If one were to assess a “pro-arbitration” policy or practice against another

as a mere box-ticking exercise by which one policy fulfills more criteria than
the other, the Swiss approach likely bests the French one.
Although both jurisdictions consider that where corruption is established an
award should be either set aside or not recognized, the great degree of deference
shown towards arbitral tribunals by the Swiss Supreme Court certainly minimizes
the intervention of national courts and enables an award to withstand challenges
in a setting aside or enforcement action.
By contrast, the French position comprises elements often deemed
antithetical to “pro-arbitration” practices. It invites national courts to proceed
to an extensive review of the facts and law and—in so doing—arguably hinders
an award’s ability to be enforced. By effectively setting their own standard of
proof for identifying corruption, namely the existence of a “serious, specific
and consistent body of circumstantial evidence” standard (“faisceau d’indices
graves, précis et concordants”), the French courts indirectly cast a shadow
over the arbitral process where the seat is in France or an award is likely to be
enforced there. Also, the fact that French courts will carry out their review
regardless of whether the issue of corrupt practices was raised before the
arbitral tribunal breaks with the view that parties should be precluded from
raising (often in bad faith) novel arguments at the setting aside and enforcement
stages.
However, this box-ticking exercise hardly seems a suitable way of assessing
a policy’s arbitration friendliness. The Swiss approach ticks more traditionally
“pro-arbitration” policy boxes. Yet, the French courts’ approach is primarily
motivated by the “consideration of values that are largely extrinsic to arbitration
itself,” namely tackling corruption, and in so doing may perhaps be counted
“among the most arbitration-friendly moves one can make” (op. cit. Bermann
(2018), p. 353).
The French approach does indeed appear to take a firmer stance against
corruption than the Swiss one. The most striking illustration is the Swiss
Supreme Court’s refusal to entertain arguments pertaining to corruption if the

parties do so for the first time at the setting aside or enforcement stage (other
than in circumstances where the evidence was not available beforehand). The
reasons underlying this approach are that the arbitral tribunal is the proper
forum to raise such issues and for the court to entertain such arguments would
reward bad faith and dilatory tactics. Yet, in so doing, this effectively means no
proper review of corruption allegations ever occurs.
It would nevertheless grossly mischaracterize the Swiss approach to
suggest it foregoes any control. Rather, the Swiss Supreme Court considers that
addressing corruption allegations is a matter best fit for the arbitral tribunal.
National courts are not necessarily better apt at tackling corruption than
arbitral tribunals. Granted, the imperium of State courts can enable them to
compel parties to produce evidence and threaten to sanction them, but this power
greatly depends on jurisdictions in which the parties are located (although
ultimately failure to comply does carry the threat of the award potentially
being set aside or not enforced). Moreover, arbitral tribunals may also be better
placed to thoroughly review and assess the evidence. In this respect, although
the standard of proof adopted by French courts signals a tough stance on
corruption by acknowledging the reality that such practices are difficult to
establish, it may also risk unfairly penalizing legitimate commercial activities,
which in turn undermines accuracy in the administration of justice.
Nevertheless, in an age where arbitration is under attack, giving off the
right impression should not be underestimated. Regardless of whether this
stance may only marginally be more effective in tackling corruption, the French
approach is undoubtedly perceived as less permissive than the Swiss one and
for this reason may in fact amount to a policy or practice that “enhance[s]
arbitration’s legitimacy overall” (op. cit. Bermann (2018), p. 352). That said,
such in depth scrutiny may not necessarily be warranted for all other aspects
of public policy, especially in an international context where the transaction
might have little or no ties to the court of enforcement and the public policy
exception does not enjoy such widespread international consensus.
The pros and cons listed above underscore the importance of seeking a
compromise between competing considerations whilst keeping in mind that
“[a] less drastic policy or practice in pursuit of one arbitration value may manage
to leave other arbitration values largely intact” (op. cit. Bermann (2018),
p. 348–349). A “pro-arbitration” solution might consist in policies encouraging
arbitral tribunals to raise issues pertaining to corruption sua sponte and
facilitating their ability to seek assistance from national courts to obtain and
secure evidence.
Chapter 58
THE NEGATIVE EFFECT OF THE COMPETENCE‐
COMPETENCE PRINCIPLE IN FRANCE: TWELVE
YEARS LATER
Laura Fadlallah*
Twelve years ago, France revised its arbitration law with Decree No. 2011-
48 of 13 January 2011 (the “2011 Decree”) and included the (established)
negative effect of the principle of competence-competence in its arbitration
law. Twelve years ago, at my modest level, I assisted Professor Bermann with
the preparation of an article on “The ‘Gateway’ Problem in International
Commercial Arbitration.” At the time, as a French-educated student, my work
focused on the French approach, with an emphasis on the negative effect of the
competence-competence principle. It only seemed fitting to dedicate these few
pages to this topic, which not only is a poster child of France’s pro-arbitration
policy but also embodies the evolution of what it means to be pro-arbitration.
I. INTRODUCTION
The principle of competence-competence is most commonly referred to for

its positive effect, according to which an arbitral tribunal has jurisdiction to
rule on its own jurisdiction (the “Positive Effect”). Article 1465 of the French
Code of civil procedure (FCCP) provides that “[t]he arbitral tribunal has
exclusive jurisdiction to rule on objections to its jurisdiction.” This side of the
principle, which is uncontroversial in modern arbitration law, aims at ensuring
that, as an adjudicatory body, an arbitral tribunal has the power to rule on
jurisdictional objections.
The negative effect of the principle of competence-competence (the “Negative
Effect”) comes, for its part, as a limitation to domestic courts’ jurisdiction through
a rule of priority in favor of arbitral tribunals. The Negative Effect means that
domestic courts will decline jurisdiction if presented with the merits of a
dispute subject to an arbitration agreement (the Negative Effect does not bar
provisional measures requests, see Article 1449 FCCP). As such, the Negative
Effect is not problematic: it is a core protection of the effectiveness of the
Positive Effect and, therefore, of arbitration, upheld by international instruments
(see, e.g., New York Convention (1958), Article II(3); UNCITRAL Model Law
This essay was drafted on the basis of the case law available as of September 2022.
Laura Fadlallah is a Partner of the International Arbitration team at Bredin Prat SAS in
*
Paris (France); and is a LLM (2010) from Columbia Law School. The views expressed in this
essay are those of the author only.
329
(2010), Article 8). It ensures that an arbitration agreement will be given full
effect, in line with the obligations of each New York Convention Contracting
State (New York Convention (1958), Article II(1)).
The exceptions to the Negative Effect—i.e., the cases in which the Negative
Effect is excluded, and domestic court proceedings can proceed—are where the
tension traditionally lies. The New York Convention and the Model Law refer to
cases in which the arbitration agreement is “null and void, inoperative or
incapable of being performed.” French law also refers to cases of nullity or
inapplicability of the arbitration agreement as exceptions to the Negative
Effect; however, through two adjustments, the regime of these exceptions has
been at the forefront of France’s pro-arbitration policy.
II. THE FRENCH APPROACH TO THE NEGATIVE EFFECT
Before the 2011 Decree, the Negative Effect was based on the combination
of the principle of validity of the arbitration agreement and the Positive Effect
(see Civ. 1, 7 June 2006, ABS, n°03-12.034) and referred to as a material rule of
French arbitration law (see Civ. 1, 16 October 2001, Sté Quarto, n°99-19.319).
Since the 2011 Decree, Article 1448 FCCP, as applicable to international
arbitration (by reference in of Article 1506 FCCP), provides that:
When a dispute subject to an arbitration agreement is brought before

a court, such court shall decline jurisdiction, except if an arbitral tribunal
has not yet been seized of the dispute and if the arbitration agreement
is manifestly void or manifestly not applicable.
A court may not decline jurisdiction on its own motion.
Article 1448 FCCP includes a third paragraph, which does not apply to
international arbitration. That third paragraph makes the first two paragraphs
mandatory, such that the parties cannot contract out of the French approach
to the Negative Effect. However, the Cour de cassation recently recalled that,
while the Negative Effect as codified in the FCCP may be excluded by the parties
to an international arbitration agreement, this exclusion must be “express and
unequivocal” and cannot derive from the mere choice of a seat and procedural
law of the arbitration (in that case, London and English law respectively) that
does not uphold the same approach to the Negative Effect (Civ. 1, 9 March 2022,
n°20-21.572). A party challenging the applicability of an arbitration agreement
might be better suited before an arbitral tribunal. Take, for example, a case of a
non-signatory involved in the performance of the contract incorporating the
arbitration agreement. If a French court were to decide on the applicability of
the arbitration clause, it would likely find, on the basis of its longstanding case
law (see for a recent example, Paris, 23 November 2021, n°18/22323) that the
non-signatory should be considered bound by the arbitration agreement (see
for a recent example, Paris, 14 September 2021, n°21/03556). On the other
NEGATIVE EFFECT OF THE COMPETENCE-COMPETENCE PRINCIPLE IN FRANCE 331
hand, in front of the arbitral tribunal, the non-signatory could argue that—
London being the seat of the arbitration and therefore the country whose law
will govern potential annulment proceedings against the award—the arbitral
tribunal should follow the English approach to the application of the arbitration
agreement and therefore consider that a non-signatory cannot be bound by
such a clause (see for a recent example, Civ. 1, 28 September 2022, Kout Food,
n°20-20.260).
In the spirit of not settling for the obvious choice, the exceptions to the
Negative Effect will be considered first (A) before turning to the recent
applications of the rule itself by French courts (B).
A. The Exceptions to the Negative Effect: The Traditional Face of France’s

Pro‐Arbitration Policy
The exceptions to the Negative Effect are, traditionally, at the heart of the
French pro-arbitration policy:
 Cumulative requirement of no ongoing arbitration proceedings. If

arbitration proceedings are already ongoing (i.e., under French law,
once the arbitral tribunal is fully constituted, see Civ. 1, 25 April 2006,
n°05-13.749 and Article 1456 FCCP), the analysis stops here, and the
court must deny its jurisdiction. This is a rule of absolute priority. It is
not the solution adopted by the UNCITRAL Model Law, which expressly
states that arbitration proceedings may be initiated or continued while
court proceedings are ongoing, i.e., in essence, that court and arbitration
proceedings could proceed in parallel. The idea underlying the French
approach is that the initiation of court proceedings while an arbitral
tribunal is constituted and therefore ready to hear the dispute is more
likely to be a disruptive tactic than the initial filing of the arbitration.
 Manifest nullity or manifest inapplicability. In the absence of ongoing
arbitration proceedings, the court must dismiss its jurisdiction unless it
finds that the arbitration agreement raised by the objecting party is
either manifestly null or manifestly inapplicable. It is one of those cases
where the adverb matters. The Cour de cassation recently recalled that
manifest means “obvious, undisputable, detectable at first sight” (Civ. 1,
24 June 2020, n°19-12.701) and that impecuniosity does not, in and of
itself (reserving the case where arbitration was effectively not possible
due to the financial difficulties), amount to manifest inapplicability (Civ. 1,
28 September 2022, n°21-21.738). Under the French approach, unless
no applicable or valid arbitration agreement can be found on the face of
the case (albeit the length of the court’s reasoning can sometimes make
one wonder as to the depth of the scrutiny), the issue will be transferred
to the arbitral tribunal. The arbitral tribunal will then have to decide on
the validity and applicability of the arbitration agreement, in the
context of the decision on its own jurisdiction. Considering the scarcity

of cases in which French courts have considered an arbitration agreement
manifestly null or manifestly inapplicable—these mostly arise from fact-
specific (e.g., application of a choice-of-forum clause) or field-specific
(e.g., bankruptcy law) considerations—this is a rule of quasi-absolute
priority. Again, it is different from the solution of the UNCITRAL Model
Law, which may involve full control of the nullity or inapplicability of
the arbitration agreement; by following that approach, the issue of the
validity or applicability of an arbitration agreement may never be
debated in front of an arbitral tribunal.
In a recent case, the Paris Court of Appeals forcefully recalled the quasi-
absolute priority rule by declining jurisdiction in a post-M&A dispute presented
as extra-contractual by the claimant, which was not a signatory to the arbitration
agreement. Having considered that the SPA, which contained the arbitration
agreement, was part of a broader transaction and that the non-signatory
claimant had been directly involved in the activity that was ceded through that
transaction, the Court considered that “[i]n light of all these elements, from
which it does not derive in a manifest manner, an inapplicability of the arbitration
agreement on the basis of the topic or the parties, the arbitral tribunal has priority
to rule on its jurisdiction” (Paris, 6 July 2021, n°21/03597; see also for other recent
reminders: (on non-signatories) Civ. 1, 28 September 2022, n°20-10.049; (on
non-signatories and “groups of contracts”) Paris, 24 May 2022, n°21/21700).
This is unsurprising considering the French approach to the application of
arbitration agreements to non-signatories and extra-contractual disputes,
which are other traditional examples of France’s pro-arbitration policy.
B. The Rule of the Negative Effect: The New Face of France’s

Pro‐Arbitration Policy
The rule of the Negative Effect is uncontroversial: in the presence of an

arbitration agreement (which excludes optional arbitration clauses, i.e., clauses
providing for arbitration or court proceedings at the option of the parties, see
for a recent example, Paris, 1st July 2021, n°21/01799), courts must decline
jurisdiction if one of the parties raises an arbitration agreement.
However, it is this uncontroversial rule that gave rise to the most important
French court decision on the Negative Effect in recent years. In its PWC decision,
the Cour de cassation, reversing its earlier position (see, e.g., Civ. 1, 30 March
2004, n°02-12.259), excluded the application of the Negative Effect in consumer
disputes (Civ. 1, 30 September 2020, PWC, n°18-19.241). The case arose from
a dispute between the law firm of PricewaterhouseCoopers (PWC) and one of
its individual clients, who had retained the firm to assist her with a family
inheritance. The client considered that PWC had failed in the performance of
its obligations and initiated court proceedings in France. PWC raised the
NEGATIVE EFFECT OF THE COMPETENCE-COMPETENCE PRINCIPLE IN FRANCE 333
arbitration clause in the contract with its clients and, on the ground of the
Negative Effect, requested that the French court decline jurisdiction. The
Versailles Court of Appeal dismissed the jurisdictional objection on the basis
that the arbitration clause was to be considered an abusive clause pursuant to
EU consumer law (Versailles, 15 February 2018, n°17/03779). PWC challenged
the Court of Appeal’s reasoning on the ground of the Negative Effect. PWC
argued that the analysis of whether a clause is to be considered abusive
pursuant to EU consumer law involves a detailed analysis that goes beyond the
realm of the “manifest” of Article 1448 FCCP. The Cour de cassation dismissed
PWC’s challenge and confirmed the Court of Appeal’s reasoning, holding that
“[t]he procedural rule of priority set forth by [Article 1448 FCCP] cannot have
the effect of making impossible, or excessively difficult, the exercise of the
rights afforded to the consumer by European community law that national courts
are obligated to safeguard.” The Cour de cassation (like the Court of Appeal)
merely excluded the Negative Effect; it did not go through an analysis—bound
to be artificial—of the exceptions to the Negative Effect.
Finally, the fact that the court cannot decline jurisdiction on its own motion
is logical (see New York Convention (1958), Article II(3) (“at the request of one
of the parties”) and UNCITRAL Model Law, Article 8(1) (“if a party so
requests”))—arbitration is based on consent and both parties to an arbitration
agreement may decide to amend their agreement and submit their dispute to
the courts. This amendment may be implied through their behavior, i.e., through
the filing of court proceedings by a claimant accepted by a respondent that
does not object to the jurisdiction of the court. On this point, the Cour de
cassation recently made two clarifications. First, the Cour de cassation (raising
the ground on its own motion) held that a court should raise Article 1448 FCCP
on its own motion and invite the parties to comment if a party objects to the
jurisdiction of French courts but fails to raise this specific provision (in that
case, the objecting party relied on international lis pendens) (Civ. 1, 17 March
2021, n°20-14.360). Second, the Cour de cassation placed “the principle of
procedural fairness that governs the parties to an arbitration agreement” as a
limitation to the ability to raise an objection based on the Negative Effect (Civ. 1,
9 February 2022, Tagli’apau, n°21-11.253). In that case, a claimant had initiated
an ICC arbitration but had to withdraw the proceedings because the respondents
had not paid their share of the arbitration costs provision (and the claimant
had not covered for the respondents). The claimant therefore initiated court
proceedings, but the respondents then raised the Negative Effect and were
followed by the Court of Appeal. The Cour de cassation quashed the Court of
Appeal’s decision considering that the respondents’ jurisdictional objection
was inadmissible. In doing so, the Cour de cassation again avoided what was
bound to be an unsatisfactory discussion on the Negative Effect.
III. CONCLUSION
The traditional pro-arbitration stance of the French approach to the Negative

Effect is clear: by strictly limiting the cases in which court proceedings may
move forward on the merits despite an arbitration agreement, French law
ensures that arbitral tribunals have priority in deciding on their jurisdiction,
which includes deciding on the validity and applicability of the arbitration
agreement. It is only once the arbitral tribunal has made its determination in
an award that the courts may review this finding in the context of annulment
proceedings against the award or appeal proceedings against the exequatur
order (Article 1520 1° FCCP). In such a case, the courts regain their full
adjudicatory power: they can consider all factual and legal allegations of the
parties (see for a recent example, Civ. 1, 31 March 2021, Rusoro, n°19-11.551).
This chronological priority is the balance found by French law between the
efficiency and legitimacy of arbitration. This latter concern has been and must
remain a focus of pro-arbitration policies. The PWC and Tagli’apau decisions
show that the less obvious solutions in terms of support of arbitration may
sometimes be the pro-arbitration solution: by excluding the Negative Effect,
the Cour de cassation protected it.
Indeed, the recipes for arbitration efficiency are now widely understood and
implemented, be it in national legislations or institutional rules. The principles
are mature. The focus on efficiency is now on more practical matters either in
terms of format of the proceedings (e.g., expedited arbitrations, e-arbitration,
etc.) or of the tools available to tribunals (e.g., bifurcation, staggered document
production, early dismissal of claims or defenses, etc.). The pro-arbitration
movement is now, as it should be, more concerned with ensuring the legitimacy
of the arbitration process. In that context, a refined approach to what it is to be
pro-arbitration can only be saluted.
Chapter 59
SOLVING OUTER SPACE DISPUTES THROUGH
SPACE ARBITRATION
Laura Yvonne Zielinski*
I. THE INCREASING EXPLORATION OF SPACE AND A LIKELY RISE IN

THE NUMBER OF DISPUTES
While not long ago, space exploration was a domain reserved for States,
and even among States only to those with the extraordinary means required
to undertake missions beyond Earth, the last decades have witnessed the
increasing privatization and democratization of our orbits. Space activities
now increasingly attract private investment and range from telecommunication
services, Earth observation and military applications to space tourism and
space mining projects. According to Euroconsult, the global space economy
totaled USD 370 billion in 2021. According to authors such as Robert Zubrin,
the settlement of Mars or the mining of asteroids are now well within our
reach, and the opportunities in outer space seem endless. However, these new
developments are not without risks, and it is likely that the increasing
exploitation of outer space will be accompanied by a rising number of disputes
between spacefaring parties.
The disputes that we can expect are above all contractual, as space activities,
like activities on Earth, imply a large number of contractual relationships
governing for example the manufacturing, transport, and launch of satellites,
or maybe soon new activities such as the provision of space hotels. We are also
likely to see an increasing number of tort cases relating to collision avoidance
maneuvers or even actual space collisions either between two active satellites
or an active satellite and a defunct satellite or parts of it, so-called space debris.
Launching a satellite, or any other space mission that might soon become reality,
are costly and risky endeavors, and given that under international space law
any private space mission must be supervised by a State and therefore maintains
a clear link to a “host State”, it is not impossible that we will also see a rising
number of claims relating to investments in outer space. Finally, the new
opportunities opening up in space and the resulting questions relating to
* Laura Yvonne Zielinski is an Attorney with Holland & Knight in Mexico City. She is
specializing in investment and commercial arbitration and in public international law. She studied
law at Sciences Po in Paris and at Columbia Law School in New York, and has recently obtained
a certificate in Strategic Space Law from McGill University. She founded the Space Arbitration
Association in 2021 and frequently speaks and publishes about dispute resolution in the space
industry.
335
property rights and liability for damage caused by space collisions could also
give rise to inter-State disputes in the near future.
This essay will provide a quick overview of the four types of outer space
disputes discussed above and describe the role international arbitration can
and should play in resolving each of them.
II. CONTRACTUAL DISPUTES ARISING OUT OF OUTER SPACE

ACTIVITIES
As mentioned above, space activities largely depend on contractual relations

between the different actors involved. Contrary to other industries, international
space activities have been characterized so far by a strong focus on non-
litigious dispute resolution mechanisms. Space is a very complicated and risky
environment and until recently, there were only a few, and often interdependent,
actors involved, so collaboration seemed more attractive than confrontation.
To that aim, space contracts often include cross-waivers of liability, and insurance
has often taken the place of dispute resolution mechanisms. However, at the
current pace of new companies entering the realm of outer space, the size of
current projects, and the ever-increasing diversification of possible projects, it
is likely that sooner or later, collaboration will give rise to more conventional
forms of dispute resolution—which is where international arbitration comes
into play.
Space activities are often international, highly technical, and in many cases
confidential. They are international because it is common, for example, for a
satellite to be produced in one country, transported to another to be launched,
and operated from yet another jurisdiction. They are also more technical than
many other industries simply because of the scientific know-how needed to
conduct a space operation. Finally, confidentiality is of particular importance
in the space industry because many commercial satellites have so-called dual-
use functions, meaning that they can be turned into military assets if necessary,
with the corresponding consequences for national security and corresponding
export controls by the country in which the satellite in question was produced.
At this point, anyone familiar with international arbitration is probably
already thinking that international arbitration can cater to all of these
specificities. And they are right. International arbitration, more than any domestic
court, can be tailored to respond specifically to these requirements of the space
industry, with the additional advantage of resulting in a binding decision that
can be enforced internationally through the New York Convention. Following
this logic, in 2011, the Permanent Court of Arbitration published its Optional
Rules for Arbitration of Disputes Relating to Outer Space Activities (PCA Outer
Space Rules). These Rules are based on the well-known UNCITRAL Rules but
contain various adaptations to better suit the above-mentioned requirements.
Up to the date of writing, it seems that the PCA Outer Space Rules have not
yet been used, although it has been commented that this could change (Frank
SOLVING OUTER SPACE DISPUTES THROUGH SPACE ARBITRATION 337
von der Dunk, “Space Law and the Resolution of Disputes on Space Activities”,
2021). And indeed, it is a fact that many space contracts do contain arbitration
clauses. As an example, the European Space Agency provides for arbitration in
Clause 35(2) of its Regulations. It is therefore unsurprising, that there have
already been a number of commercial ‘space arbitrations’ over for example,
the late delivery of satellites, the insertion of a satellite into a wrong orbit,
defective satellites already in orbit, the lease of satellite capacity, the right to
orbital positions and frequency bands, and the cancellation of space contracts (see
Jan Frohloff, “Arbitration in Space Disputes”, 2019). It is very likely that the next
few years will see a growing number of these commercial space arbitrations.
III. TORT CASES ARISING OUT OF SPACE COLLISIONS OR COLLISION

AVOIDANCE MANEUVERS
The role of international arbitration is less clear when it comes to tort cases
in space. This is due to the obvious observation that tort cases lack a contractual
link and therefore the contractual consent to arbitrate a dispute. And this,
although an efficient dispute resolution mechanism for these cases is becoming
more important than ever: because of the multiplication of launches of space
objects mentioned above, space—especially the lower orbits—is becoming
increasingly congested, thereby significantly increasing the risk of collisions
and the avoidance maneuvers necessary to avoid them.
Unfortunately, there are no binding substantive rules yet to govern space
traffic but there is an international treaty, the Convention on International
Liability for Damage Caused by Space Objects (the “Liability Convention”). The
Liability Convention contains a dispute resolution mechanism in the form of a
Claims Commission, which has been called a form of “quasi-arbitration”. While
similar to arbitration to some extent, the Claims Commission presents two main
drawbacks: its decisions are binding only when both parties agree, and the
Liability Convention, being an international treaty, only applies to States, and
is therefore not available for private parties other than through diplomatic
protection.
It follows that a private party harmed in space only has the choice between
asking its “host State” for diplomatic protection under the Liability Convention,
or bringing a claim in a domestic court. Domestic court proceedings of space
disputes are however not much less problematic than the Claims Commission
under the Liability Convention. In addition to the well-known downsides of
trying international cases in a domestic forum such as bias, language, etc, any
claim in a domestic court for harm suffered in space is also likely to cause lengthy
arguments over the court’s competence, the applicable law, the appropriate
burden of proof, and probably also over sovereign immunity of a possible State
defendant.
In light of this lack of an efficient dispute resolution framework, it is worth
reconsidering whether there could be a possibility of resolving disputes over
torts in space through arbitration. There is the obvious possibility of agreeing to

arbitration once a dispute has arisen, but this option lacks the required certainty.
Interestingly, however, it has been suggested that States amend their domestic
laws to condition the launching license for any space object on the mandatory
consent to arbitration for any dispute involving the object in question (Hertzfeld,
Nelson, “Binding Arbitration as an Effective Means of Dispute Settlement for
Accidents in Outer Space”, 2013). While this requires concerted action by
countries around the world, it could be more easily achieved than a new
international treaty, and would draw on the advantages of international
arbitration to provide space actors with the forum for settling disputes relating
to space collisions and avoidance maneuvers they will so desperately need.
IV. DISPUTES OVER INVESTMENT PROTECTION IN OUTER SPACE
While the role of investment arbitration for space collision cases remains
very hypothetical, there have already been several investor-State arbitrations
over investments in outer space relating to more conventional treaty breaches.
Launching a space object is a risky and long endeavor, and as such is likely
to comply with the required characteristics for an “investment” under both the
majority of bilateral investment treaties and Article 25 of the Convention of the
International Centre for Settlement of Investment Disputes (ICSID). In addition,
although one could argue that an investment in outer space could not satisfy
the territoriality requirement of most bilateral investment treaties, it could be
countered that past tribunals have considered that the required territorial link
should be defined as something beyond a physical connection. The tribunal in
Ambiente Uffizio v. Argentina for example held that the link should be understood
to exist with the State that benefited most from the investment in question (ICSID
Case No. ARB/08/9, Decision on Jurisdiction and Admissibility, paras. 498–499).
Alternatively, investments in outer space often have a more concrete link with
a “host State”, as most objects launched into space are registered by a State
according to the Convention on Registration of Objects Launched into Outer
Space (the “Registration Convention”). In addition, geostationary orbital positions
are attributed to States by the International Telecommunications Union and
the States can then put them at the disposal of private parties, for example
through concession contracts, which also creates a very tangible link between
certain investments physically located in outer space and their host State.
Past investment treaty cases relating to outer space investments have
surpassed these jurisdictional hurdles and dealt with alleged breaches of
expropriation and the fair and equitable treatment standard. The cases Devas
v. India and Deutsche Telekom v. India arose out of India’s revocation of leased
S-band frequency spectrum, and Eutelsat v Mexico related to a provision allowing
for the free reservation of satellite capacity for the Mexican government. (Devas
v. India, PCA Case No. 2013-09; Deutsche Telekom v. India, PCA Case No. 2014-10;
Eutelsat v. Mexico, ICSID Case No. ARB(AF)/17/2).
SOLVING OUTER SPACE DISPUTES THROUGH SPACE ARBITRATION 339
V. INTER-STATE DISPUTES RELATING TO OUTER SPACE
The activities of States in outer space are governed mainly by four

international space treaties: the Treaty on Principles Governing the Activities
of States in the Exploration and Use of Outer Space, including the Moon and
Other Celestial Bodies (the “Outer Space Treaty”), the Agreement on the Rescue
of Astronauts, the Return of Astronauts and the Return of Objects Launched
into Outer Space (the “Rescue Agreement”), and the Liability Convention and
Registration Convention mentioned above. These treaties set the substantive
rules for State activities in outer space but only the Liability Convention contains
an explicit dispute resolution mechanism in the form of the Claims Commission
discussed above (Articles XIV–XX of the Liability Convention). In contrast, the
Outer Space Treaty provides that “States Parties to the Treaty shall carry on
activities [...] in accordance with international law, including the Charter of the
United Nations [...]” (Article III of the Outer Space Treaty). This article is commonly
understood as referring to Article 33, Chapter VI of the UN Charter, which lists
“negotiation, enquiry, mediation, conciliation, arbitration, judicial settlement,
resort to regional agencies or arrangements, or other peaceful means of their
own choice” as possible dispute resolution mechanisms.
Given the non-binding nature of these available mechanisms, in 1998, the
International Law Association published its Final Draft of the Revised Convention
on the Settlement of Disputes related to Space Activities, establishing arbitration
as a binding dispute resolution mechanism mirroring the provision of the United
Nations Convention on the Law of the Sea. This convention has however failed
to enter into force.
Nonetheless, the inclusion of arbitration clauses in most of the conventions
establishing international organizations active in outer space (such as the
International Telecommunications Union or the European Space Agency)
warrants thinking that international arbitration will be the mechanism of choice
if and when States can agree on a new binding dispute resolution framework
for their space activities.
VI. CONCLUSION
What does it mean to be pro-arbitration? It means to recognize the potential

of international arbitration as a dispute settlement mechanism that cannot only
be adapted to all types of disputes on Earth but that can even play a role in solving
disputes arising out of humanity’s quest for new worlds. While complementing
the existing international space treaties with new substantive and procedural
rules remains the most crucial goal, international arbitration can and should
be used to fill the current lacunae in the law until this goal becomes a reality.
Chapter 60
SWITZERLAND’S STEADFAST PRO-ARBITRATION
STANCE
Laurence Burger*
I am honored to be asked to participate in the preparation of the liber

amicorum for Professor Bermann, whose lectures on arbitration and international
dispute resolution I had the privilege to attend during my years at Columbia
Law School.
In this context, I have read with interest his piece entitled “What Does it
Mean to Be ‘Pro-Arbitration?’”, in which Professor Berman elaborates on
Professor Park’s four basic goals of internal arbitration, i.e., accuracy, fairness,
efficiency and enforceability of the award. He sets forth a non-exhaustive
catalog of twelve criteria to gouge, more specifically, the character of a policy
or practice as favorable, or not, to arbitration. In this note, I discuss some of
the illustrations proposed by Professor Bermann in comparison to policies and
practices in my own jurisdiction, Switzerland, which has a reputation for being
strongly in favor of arbitration.
I. ARBITRAL PREFERENCE
Arbitral preference is embedded in the Swiss lex arbitri, which can be

found in Articles 176 to 194 of the Swiss Private International Law Act (PILA).
One of the best examples is Article 186 (1bis) PILA. Article 186 sets forth the
principle of competence-competence, according to which an arbitral is
competent to review its own competence. Article 186(1bis) provides that this
is the case even if the dispute is already pendent before another court or
arbitral tribunal, unless there are serious reasons to suspend the proceedings.
II. TRIBUNAL SECRETARIES
Professor Bermann discusses the role of tribunal secretaries as one of the

topical issues subject to competing for pro-arbitration assessments. Indeed,
while the use of a secretary will usually lead to important economies, it may
also disappoint parties who feel that their choice of a particular arbitrator to
decide their dispute is not respected when that person delegates part (and
sometimes most) of the work to a secretary.
This role of arbitral secretaries has been discussed in a decision of the
Swiss Supreme Court of 2015 (DTF 4A_709/2014), in which the appellant
* Laurence Burger is an Attorney-at-law and writer in Geneva, Switzerland.

341
argued that the sole arbitrator had not decided the case alone because of the
assistance of another lawyer and of a secretary. The parties had been informed
of such assistance early on; the lawyer was a “legal consultant” while the
secretary was in charge of administrative tasks. At the outset, the Supreme
Court repeated the principle that arbitrators are appointed intuitu personae
and thus must fulfill their mandate themselves. However, the prohibition to
delegate core decision-making functions such as learning the file, deliberating
and taking part in taking the decision does not prevent arbitrators from relying
on the assistance of an administrative secretary who may assist to some extent
the arbitrators in drafting the award. For instance, they may attend the hearings
and sit in the deliberations of the tribunal, as long as they do not exercise judicial
functions. The Supreme Court held that the use of a legal consultant is also
allowed when, for instance, the consultant may help the tribunal with complex
technical or commercial issues, but that the same restrictions as those set out
for administrative secretaries apply. In both cases, the tribunal does not require
prior consent of the parties.
Hence, it appears that as long as the role of secretaries and consultants is
limited by strict and clear rules, their use should not raise concerns for the
parties who wish to see their case decided by the arbitrators. In fact, and this
point is also emphasized by the Swiss Supreme Court, judges of state courts
also use clerks to prepare the files and draft some sections of the decisions.
III. ECONOMY OF TIME AND COSTS; DUE PROCESS
Another classic confrontation between pro-arbitration values is the need to

ensure an economy of time and costs while avoiding challenges on due process
grounds. This often requires a difficult balancing act from tribunals when
confronted with requests for additional time or extensive document production.
In Switzerland, however, the Supreme Court has recently changed its position
(DFT 133 III 235): whereas the right to be heard was previously formal in
nature, so that a violation justified annulling the decision without regard to the
substantive chances of success, the latest case law requires the challenging
party to show that the outcome of the dispute would have been practically
different if the right to be heard had not been infringed. This new position,
which allows tribunals to focus on the merits of the case and the efficiency of
the process, is therefore definitely pro-arbitration.
IV. EXTENSION OF THE ARBITRATION AGREEMENT TO A

NON-SIGNATORY
In Switzerland, it is typically the arbitral tribunal that decides whether an

arbitration agreement should be extended to a non-signatory. In a recent
decision, the Supreme Court refined its line of precedents regarding extensions of
arbitration agreements. Whereas previous decisions had held that the assignment
SWITZERLAND’S STEADFAST PRO-ARBITRATION STANCE 343
of a claim, the assumption of debt or contract or the interference of a non-

signatory in the performance of the contract containing the arbitration clause
was sufficient to extend this clause, in DFT 147 III 107, the Court held that a
clause could not be extended to a sub-supplier when the parties were aware,
or should have been aware under the circumstances, that the third party was
not a party to the main agreement. This decision, which now establishes a clear
line as to the extension of an arbitration agreement, is decidedly pro-arbitration.
V. CONCLUSION
Being pro-arbitration can be, and increasingly is, a country’s political

choice and a calculation to attract arbitration proceedings. Governments try to
send signals intending to show that their legal system favors this type of
dispute resolution. The flurry of new arbitral institutions being created all over
the world attests to that trend. However, the work of legislators alone is often
not sufficient; courts must also render decisions that clearly favor arbitration,
thus allowing litigants to have a clear view of what to expect when choosing a
seat for their proceedings. This has been understood for a long time by the
Swiss Supreme Court, which works hand-in-hand (and sometimes even sends
signals to) the legislator to ensure that the countries’ reputation as favorable
to arbitration remains. Evidently, not all issues have been decided as of yet, but
knowing the Swiss Supreme Court’s favorable stance on arbitration also leads
to more predictability.
Chapter 61
TOWARDS A MORE PERFECT UNION:
THE EVOLUTION OF THE AMERICAN
PRO-ARBITRATION POLICY
Levon Golendukhin*
It is frequently suggested that the crux of what makes the United States a
“pro-arbitration” jurisdiction is the federal policy favoring arbitration for the
settlement of commercial disputes where parties have an arbitration agreement.
Indeed, American practitioners of arbitration and arbitration-related litigation
frequently are closely familiar with the question of whether a state law rule is
at its core “pro-arbitration,” when arguing before U.S. courts whether the rule
in question is preempted by federal policy favoring arbitration for the
resolution of commercial disputes.
Processes for the fast-tracking of arbitration, such as delegation to the
arbitrator of the question of consent to arbitration (where the prescribed arbitral
rules allow such determinations), are viewed by several federal court circuits
in the US as being “pro-arbitration” and thus incorporated into and promoted
by federal public policy. Conversely, state law rules or civil procedures that are
deemed to undermine the arbitral process may be overridden by federal public
policy. As a result, the question of whether a particular rule or aspect of
arbitration is “pro-arbitration” is not only determined by, but itself also shapes,
the contours of the federal policy favoring arbitration.
Among the profound insights in Professor Bermann’s formative article
“What Does it Mean to Be ‘Pro-Arbitration’?” is the recognition that there are
effectively two levels of inquiry of arbitration-friendliness, each involving
frequently contradictory factors to be considered and weighed. One such level
of inquiry—which Professor Bermann termed the “intrinsic” values inquiry—
is focused almost entirely on the users of arbitration, and the values and
procedures that would be favored by them. After all, arbitration being a creature
of consent necessarily means that it must be desirable to its prospective users
in order to exist at all. The second and more profound level of inquiry—
Professor Bermann’s “extrinsic” values inquiry—focuses on the broader context
in which arbitration finds itself. That is, rather than taking the existence of
effective arbitration for granted, Professor Bermann recognizes that arbitration
* Levon Golendukhin is an Associate in the International Dispute Resolution practice group
at Eversheds Sutherland (US) LLP, where he concentrates his practice on international

investment law and international arbitration. A graduate of Columbia Law School and the
London School of Economics & Political Science, the author had the distinct privilege of being
one of Professor Bermann’s students and research assistants.
345
in its present form is a right developed by and with the support of Congress
with the enactment of the Federal Arbitration Act (FAA).
It is through this insight, and the broader discussion it has fostered, that
Professor Bermann describes the fragile but symbiotic relationship between
arbitral practice and federal policy and challenges users and practitioners of
arbitration to consider “our thing” in the wider context of one of several
avenues available in the U.S. for the resolution of commercial disputes. This
idea permeates the broader body and legacy of Professor Bermann’s work in
arbitration at large. Indeed, in this author’s view, the greatest legacy that
Professor Bermann bequeaths to American arbitration practitioners is a sense
of citizenship and stewardship for its development and practice of arbitration.
This is so for two reasons. First, the history of the federal pro-arbitration policy
highlights the outsized role that arbitration professionals have played in its
emergence and the role this community can play in its continued responsible
elaboration. Second, it is only through careful consideration and respect for
extrinsic factors that the arbitral community can ensure the continued buy-in
from Congress and the public at large, on which the survival of the pro-
arbitration policy rests.
While American courts unanimously credit Congress for the establishment
of the federal policy favoring arbitration, closer scrutiny of the origins of this
policy reveals a more complicated history. Specifically, the U.S. Supreme Court
famously stated in its 1983 decision in Moses H. Cone Mem’l Hosp. v. Mercury
Constr. Corp. that “Section 2 [of the FAA] is a congressional declaration of a
liberal federal policy favoring arbitration agreements, notwithstanding any
state substantive or procedural policies to the contrary.” 460 U.S. 1, 24 (1983).
But, on its face, Section 2 does not impose anywhere near so dramatic a rule.
All Section 2 prescribes is that maritime and commercial arbitration clauses and
agreements “shall be valid, irrevocable, and enforceable, save upon such grounds
as exist at law or in equity for the revocation of any contract . . . .” Under one
plausible reading of Section 2, it requires nothing more than treating agreements
to arbitrate on the same footing as any other contract, far from the “congressional
declaration of a liberal federal policy” that it has since been construed to be.
Indeed, evidence suggests that the federal judiciary played a significant, if
not determinative, role in the development of the federal policy favoring
arbitration out of Section 2 of the FAA. For example, although Congress
promulgated the FAA in 1925, the earliest decisions in federal court giving
form to a federal policy favoring commercial arbitration only appeared several
decades later. Notably, in its 1959 decision in Robert Lawrence Co. v. Devonshire
Fabrics, Inc., the Second Circuit held Section 2 to be “a declaration of national
law” invoking Congress’s admiralty and commerce powers to create national
substantive arbitration law (271 F.2d 402, 407 (2d Cir. 1959), cert. dismissed,
364 U.S. 801 (1960)). However, at that time, the existence of a broad pro-
arbitration policy with preemptive effects was far from certain, and even into
the 1980s many U.S. state courts did not consider themselves bound by the
THE EVOLUTION OF THE AMERICAN PRO-ARBITRATION POLICY 347
FAA to favor arbitration (see, e.g., Ex parte Ala. Oxygen Co., 433 So. 2d 1158,
1166 (Ala. 1983), vacated sub nom. York Int’l v. Ala. Oxygen Co., 465 U.S. 1016
(1984)). Notably, even the Second Circuit in Robert Lawrence conceded the fact
that in the decades since the passage of the FAA, the supposed congressional
declaration had gone almost entirely unnoticed (271 F.2d at 407). Still, it
insisted that this had indeed been Congress’ intent. The rest is history: starting
with a string of landmark cases in the 1980s, the U.S. Supreme Court has
revisited this question and laid the foundations for the modern conception of
the now well-established federal policy.
That the policy’s origins lie in the practice and argument before American
courts has important implications for arbitration. Although U.S. courts have
purported to act pursuant to, and in furtherance of, a congressional declaration
in favor of arbitration, courts and arbitration practitioners presenting arguments
before them should be conscious that there may be limits or constraints on
Congress’ support for the streamlining of arbitration in the U.S. For his part,
Professor Bermann’s work and legacy embodies an acute awareness of the
need for continued legislative buy-in as a precondition for the survival of
effective commercial arbitration. In “What Does it Mean to Be ‘Pro-Arbitration’?”,
he offers two examples of the potential limits of legislative tolerance of arbitration
from across both sides of the Atlantic. In Europe, the EU’s Directive 93/13 on
Unfair Terms in Consumer Contracts presumes consumer arbitration contracts
to be invalid. On the other hand, in the U.S., successive sessions of Congress have
seen unsuccessful versions of a bill called the Arbitration Fairness Act
introduced in an attempt to override U.S. Supreme Court precedent sustaining
mandatory arbitration clauses in consumer contracts. Yet, just a year after the
publication of Professor Bermann’s article, an updated version of the bill called
the Forced Arbitration Injustice Repeal Act of 2019, H.R. 1423 (or simply FAIR
Act) passed in the U.S. House of Representatives, though it did not pass in the
Senate. Moreover, in March 2022, President Biden signed the Ending Forced
Arbitration of Sexual Assault and Sexual Harassment Act of 2021 into law. This
act amends the FAA by adding a fourth chapter which renders pre-dispute
arbitration agreements and class-action waivers avoidable for sexual harassment
and sexual assault disputes.
While much may be inferred from Congress’ substantial acquiescence to
the Supreme Court’s development of commercial arbitration rights in the U.S.
under the guise of federal policy stemming from the FAA, what is clear is that
Congress is not uniformly supportive of the Supreme Court’s decisions and
Congress can shift its support of arbitration. Recognition of the fallibility of
congressional support is significant. As the professed source of the pro-arbitration
policy elaborated by the federal courts, the word of Congress is supreme,
capable of unwinding decades of case law elaborating the federal policy favoring
arbitration and effectively transforming or reversing that policy. Congress
giveth, and Congress taketh away.
This need to maintain enduring congressional support as a precondition

for the long-term survival of commercial arbitration in the U.S. sets the context
for Professor Bermann’s charge in “What Does it Mean to Be ‘Pro-Arbitration’?”
to the community of arbitration practitioners to “think more deeply than it
customarily does about what it means to be pro-arbitration,” particularly in
respect of values extrinsic to arbitration. As Professor Bermann notes, the use
of arbitration has consequences for parties beyond sophisticated commercial
actors who have freely agreed to binding arbitration. It can bind consumers or
employees unaware of (or powerless to prevent) their contracts having an
arbitration clause. It can also extend to commercial entities that are non-
signatories to the arbitration agreement but who may nevertheless find
themselves being bound by it to arbitrate their disputes. The invocation of the
federal pro-arbitration policy to keep such disputes out of courts, therefore,
creates broader implications for labor, consumer protection, and other
regulations and rights. An arbitrator’s failure to carefully handle issues like
these brought before her exposes the practice of arbitration as a whole to
criticism (due or undue) as a tool for the circumvention of these regulatory
regimes. That many of these regulatory regimes also enjoy the favor of Congress
only reinforces the fragility of the federal pro-arbitration policy.
Recognizing that the dimensions of the federal pro-arbitration policy have
been shaped largely in arguments before the federal courts, Professor Bermann
charges the arbitral community with responsible stewardship over the policy.
The focus, he argues, should be devising rules and procedures of convenience
or efficiency that promote arbitration for its users that do not also materially
infringe on other rights and considerations. Professor Bermann leads this
approach by example: the Restatement of the U.S. Law of International
Commercial and Investor-State Arbitration famously advocates walking back
the precedent in a majority of federal court circuits that the designation of a
set of arbitral rules authorizing an arbitral tribunal to determine its own
jurisdiction constitutes an exclusive delegation to the arbitral tribunal of
gateway arbitrability questions. Gateway arbitrability issues and the question
of their delegation are not mere academic curiosities; they have important
implications for parties that are not habitual users of arbitration, especially
when considering that the large majority of institutional arbitral rules empower
tribunals to decide arbitrability. By depriving federal courts of review of
gateway arbitrability issues such as consent, the current approach in nearly
every federal circuit arguably enhances the risk that parties that had never
knowingly or freely consented to arbitration are compelled to arbitrate.
However, academic scholarship and the Restatement are by no means the
sole way that the arbitral community impacts federal arbitration policy. The
various ways in which the broader community of users and practitioners of
arbitration at large plays a role in the development of arbitration policy may
be best described by analogy. The late Columbia Law School Professor Oscar
Schachter articulated the concept of an “invisible college of international lawyers”
THE EVOLUTION OF THE AMERICAN PRO-ARBITRATION POLICY 349
playing a significant role in the development of the body of international law.

His notion that, within international law, exists a professional community of
lawyers with vested interests and holding common intellectual goals can be
analogized to the arbitral community. Through rotating terms served at
arbitration institutions promulgating rules of arbitral procedure, jurisdictional
and substantive arguments and rulings in arbitral proceedings, and through
arbitration-related appellate and amicus briefs and expert testimony before
the U.S. courts, arbitration practitioners share and develop their ideas about
how various aspects of arbitral policy should be interpreted, elaborated, and
re-interpreted. In these ways, they exercise a form of soft power that can shape
the elaboration of arbitral policy, not least in the seminal federal court cases
beginning in the late 1950s that proclaimed the federal policy favoring arbitration
agreements. With this power to shape arbitral policy comes also the
stewardship to ensure that its development remains faithful to values intrinsic
to the arbitration community as well as those extrinsic values important to the
public at large. Through this deeper consideration, the “invisible college” of
arbitration practitioners ensures the survival of the institution of arbitration
and the pro-arbitration policy that underpins it.
To conclude, what do the critical insights from “What Does it Mean to Be
‘Pro-Arbitration’?” entail for users and practitioners? The FAA itself is
illuminating: the history of its enactment and interpretation demonstrates that
arbitration relies on extrinsic conditions to exist and deliver its promised
efficacy and finality. Foremost among these conditions is the buy-in of
Congress and the public who votes it into office, as exemplified in the recent
Ending Forced Arbitration Act. The preservation and continuation of this external
support for arbitration is part and parcel of Professor Bermann’s charge of
stewardship to the arbitral community. The outsized role played by federal
court decisions in the development of the “congressional declaration of a
liberal federal policy” confirms the power of that community to shape arbitral
policy. Because of its diverse composition, deeper exploration of the individuals
and groups comprising the “invisible college” of the arbitral community can
also help shed light on how its power is and could be exercised for the
sustained development of a truly pro-arbitration policy.
Chapter 62
WAS THE U.S. SUPREME COURT DECISION IN
ZF AUTOMOTIVE “PRO‐ARBITRATION”?
Lorenzo Sordi*
On June 13, 2022, the U.S. Supreme Court handed down its decision in ZF
Automotive US, Inc. v. Luxshare, Ltd., 142 S. Ct. 2078 (2022). The decision resolved
the longstanding circuit split on the applicability of 28 U.S. Code Section 1782
(Section 1782) discovery to private international arbitrations. In its unanimous
decision, the Supreme Court held that Section 1782 discovery is available only
to “governmental or intergovernmental adjudicative bodies” and not to private
adjudicatory bodies such as international commercial arbitral tribunals and ad
hoc investment tribunals.
Being a much-anticipated decision by the international arbitration
community, it seems fitting to provide a few preliminary considerations on the
perceived “pro-” or “anti-arbitration” impact of ZF Automotive, together with a
short summary of the Court’s reasoning.
I. BACKGROUND
For context, Section 1782 permits, but does not require, U.S. federal district
courts to order discovery “for use in a proceeding in a foreign or international
tribunal” at the request of “any interested person,” provided that the person
from whom discovery is sought “resides” or is “found” within the district of the
district court where the application is filed. The language of Section 1782 does
not define “foreign or international tribunal” nor does it provide any guidance
as to whether (or to what extent) a district court should grant the requested
petition once the statutory requirements are met.
Prior to ZF Automotive, the leading authority on Section 1782 was the
Supreme Court decision Intel Corp. v. Advanced Micro Devices, Inc., 542 U.S. 241
(2004). In Intel, the Supreme Court held that the Directorate-General for
Competition of the European Commission qualified as a “tribunal” for the
purposes of Section 1782 when acting as a first-instance decision maker in
antitrust proceedings. In addition, the Intel decision set out the following non-
exhaustive factors to guide the district courts’ discretion when considering
Section 1782 petitions: (i) whether the person from whom discovery is sought
is a party to the foreign proceeding; (ii) the nature of the foreign tribunal, the
character of the proceedings underway abroad, and the receptivity of the
foreign tribunal to U.S. judicial assistance; (iii) whether the Section 1782
* Lorenzo Sordi is an Associate at Cooley LLP.

351
request conceals an attempt to circumvent foreign proof-gathering restrictions;

and (iv) whether the request is unduly intrusive or burdensome.
Although Intel did not involve an arbitration, the Supreme Court’s
reasoning and its broader interpretation of the term “foreign or international
tribunal” paved the way to conflicting decisions by the federal circuit courts,
which were split on the question of whether a private international tribunal
constituted a “tribunal” for the purposes of Section 1782. On this issue, the
Court granted certiorari.
II. THE SUPREME COURT’S ANALYSIS
The ZF Automotive decision arose from two consolidated appeals from the
2nd and 6th Circuits on the interpretation of Section 1782. The 6th Circuit
decision related to an international commercial arbitration involving fraud
allegations in the context of a sale between ZF Automotive U.S., Inc. and Hong
Kong-based Luxshare, Ltd. The sale contract provided for the resolution of
disputes through arbitration under the rules of the German Arbitration Institute
(DIS). Luxshare requested Section 1782 discovery from ZF and two of its officers.
The 2nd Circuit decision involved an ad hoc investment arbitration under
the UNCITRAL Rules between a Russian investor in a Lithuanian bank and the
Republic of Lithuania for the alleged expropriation of the investment in violation
of the provisions of the Lithuania-Russia BIT. The Russian investor sought
Section 1782 discovery in the U.S. from the former bank administrator, among
others.
In its decision, the Court reasoned that the statutory definition of “foreign
or international tribunal” should be understood to mean an adjudicative body
imbued with governmental authority by a single nation (a “foreign tribunal”)
or by multiple nations (an “international tribunal”). This is because, according
to the Court, the word “tribunal” should be interpreted alongside the modifiers
“foreign or international,” and as such, “tribunal” was “best understood as an
adjudicative body that exercises governmental authority.” The Court also
reasoned that limiting Section 1782’s applicability solely to bodies exercising
governmental authority squared with Congress’ original intention to promote
comity and reciprocal assistance between foreign governments and international
governmental bodies. Finally, the Court also drew support from the fact that
extending its application to private international arbitrations would bring
Section 1782 into tension with arbitrations governed by the Federal Arbitration
Act (FAA), since the FAA provides a more limited scope of discovery compared
to Section 1782.
Based on this rationale, the Court found that neither the DIS panel nor the
ad hoc UNCITRAL tribunal fell within the ambit of Section 1782. According to
the Court, arbitral commercial tribunals such as the one constituted under DIS
do not exercise governmental authority because no government was involved
in selecting the arbitral panel or in prescribing its procedures.
WAS THE SUPREME COURT DECISION IN ZF AUTOMOTIVE “PRO-ARBITRATION”? 353
With respect to the ad hoc UNCITRAL tribunal, the Court acknowledged

that it was constituted under an international treaty (as opposed to a private
contract) and included a sovereign on one side of the dispute (as opposed to
another private party). However, the Court held that neither of these facts was
dispositive. Rather, the crucial issue was whether the ad hoc investment
tribunal was vested with governmental authority. The Court did not find this
to be the case under the Lithuania-Russia BIT which did not itself create the
panel or regulated its procedure or otherwise imbued the ad hoc tribunal with
governmental authority. Accordingly, in the Court’s opinion, the investment
tribunal was “materially indistinguishable in form and function” from the DIS
panel as both derived their authority from the parties’ consent to arbitrate
rather than from a governmental authority.
III. NEED FOR CLARITY PREVAILS OVER JUDICIAL ASSISTANCE TO

FOREIGN ARBITRAL TRIBUNALS
Examining ZF Automotive through “pro-arbitration” lenses may be less

straightforward than it initially appears. As it is apparent from its textualist
reasoning, the Court gave little weight to policy considerations. This contrasts
with its previous decision on the issue, Intel, which discussed at length policy
concerns like reciprocity and the need to maintain parity between litigants.
Whether one agrees or disagrees with the Court’s statutory interpretation,
ZF Automotive represents a welcome decision that provided much needed
clarity on the scope of Section 1782 and resolved a long-standing circuit split
on the issue. In this regard, ZF Automotive promotes the accuracy in the
administration of justice, provides clear guidance to practitioners and puts an
end to questionable procedural strategies, such as forum shopping for the
most favorable district court where the evidence sought with the Section 1782
petition was located.
Another likely outcome of ZF Automotive is that courts will interfere less
with the arbitral process. Less court intervention is generally perceived as
“pro-arbitration”, insofar as it avoids interference with the tribunal’s procedural
discretion and conduct of the proceedings.
Further, ZF Automotive appears to foster the pro-arbitration values of
speed, economy and efficiency insofar as it significantly reduces the risk of
U.S.-style discovery in international arbitration. Indeed, one of the main policy
arguments against the expansion of Section 1782 to private international
tribunals was that the principal advantages of arbitration would be severely
undermined if parties were to spend time, money and effort quarreling over
burdensome discovery requests far from the place of arbitration.
However, for each of the above “pro-arbitration” considerations, there are
just as many aspects of the decision that arguably fail to advance the purposes
of international arbitration.
To begin with, ZF Automotive may have brought less clarity than expected,
especially with respect to investment arbitration. In particular, prior to ZF
Automotive, U.S. circuit courts uniformly held that investor-state arbitral
tribunals constituted under an investment treaty fell within the ambit of
Section 1782. Following the Court’s decision, this presumption has likely been
reversed, but it remains to be seen whether other investment tribunals, and
especially those administered by the International Centre for Settlement of
Investment Disputes (ICSID) could be considered to be clothed with governmental
authority. Indeed, contrary to an ad hoc UNCITRAL tribunal, ICSID derives its
authority to administer arbitrations and determine arbitral procedures directly
from the ICSID Convention, which is agreed upon and entered into by sovereign
nations. This uncertainty may well generate conflicting circuit decisions soon,
also considering that not all questions regarding Section 1782 have been
answered, including whether discovery of documents is limited to evidence
physically located in the U.S.
Second, prior to ZF Automotive, parties to international arbitral proceedings
increasingly relied upon Section 1782 to seek discovery. Going forward, parties
and their legal advisers will no longer have such opportunity and have lost a
valuable tool for the gathering of evidence, at least for commercial arbitrations
with a U.S. nexus. Accordingly, there is also an argument that reduced access
to evidence located in the U.S. may hinder the efficacy of arbitrations seated
elsewhere.
Third, common consensus dictates that discovery in international arbitration
is more limited in scope than that available in U.S. litigation, but fears that
international arbitral proceedings could be derailed by Section 1782 applications
were probably exaggerated. Indeed, federal courts faced with Section 1782
petitions, not only have the power to grant or deny them, but also to grant them
subject to conditions and limitations, including by reference to the multi-factor
test set out in Intel. In addition, even when a party was successful in obtaining
the requested evidence, the arbitral tribunal was under no obligation to
unconditionally admit it in the arbitral proceedings.
More puzzlingly, ZF Automotive seems to take a step back from federal policy
favoring arbitration and earlier decisions of the Supreme Court. In particular,
when the Court wonders why “would Congress lend the resources of district
courts to aid purely private bodies adjudicating purely private disputes abroad”,
it sounds like an echo of prior U.S. courts’ hostility to the private adjudication
of disputes that ultimately led to the enactment of the FAA. Data and statistics
overwhelmingly prove that international arbitration has become the preferred
method of adjudication of international controversies, for it provides a neutral
and flexible forum for the resolution of disputes. This is further evidenced by
the success of the New York Convention on the Recognition and Enforcement
of Foreign Arbitral Awards which has been currently ratified by 172 states.
Against this backdrop, it seems unwise to categorically deprive the international
arbitration community of court assistance under Section 1782.
WAS THE SUPREME COURT DECISION IN ZF AUTOMOTIVE “PRO-ARBITRATION”? 355
Of course, Section 1782 is not the only mechanism available to secure

evidence located abroad, albeit none is as effective as Section 1782, especially
when it comes to third-party evidence. At least two other avenues are available.
One is a “letter of request” obtained by the arbitrators from the court of the
seat of the arbitration in accordance with the provisions of the Hague Convention
on the Taking of Evidence Abroad in Civil or Commercial Matters. However,
there is very little authority on whether a court would actually entertain such
a request, not to mention the fact that this mechanism is available only to arbitral
tribunals seated in countries that are signatories to the Hague Convention
(unlike Section 1782 which has no such limitation). The second, at least for
arbitrations seated in the U.S., is for arbitrators to avail themselves of Section 7
of the FAA providing for the courts’ enforcement of the arbitrators’ subpoenas.
However, Section 7 provides a more limited scope of disclosure compared to
Section 1782 insofar as it does not permit discovery prior to the initiation of
arbitration proceedings (unlike Section 1782), and only permits the arbitral
tribunal to request discovery, not just any interested person (unlike Section
1782).
When seen from this perspective, the aftermath of ZF Automotive may
prove to be less arbitration-friendly than anticipated and there is a risk that it
may hinder the fact-finding process of international arbitrations, particularly
those involving third-party evidence. One wonders if the Court could have
followed a more balanced approach, perhaps by expanding on the Intel factors
or by giving additional weight to the receptivity of the arbitral tribunal to the
discovery sought. This could have represented a middle ground solution to
secure the advantages of court-ordered Section 1782 discovery while avoiding
the excesses typical of American procedures.
Above all, ZF Automotive represents a missed opportunity for U.S. courts to
lead the way in providing assistance to arbitral tribunals in their task of
resolving disputes effectively and expeditiously. The debate remains open, and
many questions are still unanswered, including whether other investment
tribunals, and namely those constituted under the auspices of the ICSID
Convention, fall within the scope of Section 1782. While we wait for guidance
in that regard, the hope is that future decisions will recover some of the “pro-
arbitration” ground which seems to have been lost after the Court’s decision in
ZF Automotive.
Chapter 63
SECTION 1782 DISCOVERY IN INTERNATIONAL
ARBITRATION
Manuel Valderrama*
I. INTRODUCTION
On June 13, 2022, the United States Supreme Court (the “Court”) ruled in a
unanimous decision that 28 U.S.C. § 1782—which authorizes federal courts to
grant discovery “for use in a proceeding in a foreign or international tribunal”—
is unavailable in proceedings before “private adjudicatory bodies.”
The underlying consolidated cases were ZF Automotive U.S., Inc., et al., v.
Luxshare, Ltd., and AlixPartners, LLP, et al., v. The Fund for Prot. of Investors’ Rts.
in Foreign States. The cases concerned an arbitral tribunal hearing a commercial
arbitration under the rules of a private German institution, and an ad hoc
arbitration in accordance with the Arbitration Rules of the United Nations
Commission of International Trade Law (UNCITRAL), which stemmed from a
dispute under a bilateral investment treaty. The Court’s decision rests on the
basis that a “foreign or international tribunal” under § 1782 must be a
governmental or intergovernmental adjudicative body. The Court found that
neither arbitral tribunal was “imbued with governmental authority.”
This essay briefly examines (i) the use of § 1782 in International Arbitration;
(ii) Professor George Bermann’s amicus brief in the cases; and (iii) the U.S.
Supreme Court’s decision in ZF Automotive.
II. THE USE OF SECTION 1782 IN INTERNATIONAL ARBITRATION
One of the core elements of international arbitration proceedings is the

narrow ability to obtain evidence from your counterparty. In addition, this
aspect differentiates the production and delivery of evidence in international
arbitration when compared to litigation. This is especially true for litigation in
countries like the United States where discovery is usually far-reaching, and
common as a strategy to overwhelm and undermine your opposition’s capacity
for reaction.
Within the U.S.’ widespread discovery tradition comes Chapter 28 of the
United States Code, which, under § 1782, allows parties in proceedings before
a foreign or international tribunal to obtain evidence that, within an international
arbitration proceeding, would most likely be unavailable.
* Manuel Valderrama is a Fulbright Scholar from Columbia LLM ‘18 and an Associate at
White & Case LLP.

357
Specifically, § 1782 states: “The district court of the district in which a person
resides or is found may order him to give his testimony or statement or to
produce a document or other thing for use in a proceeding in a foreign or
international tribunal [...].” As a result, parties and “prospective parties” to an
international arbitration can obtain testimony or documents from U.S. individuals
and companies by asking the competent district court. Naturally, the statute
also means that were the district court to grant the discovery request, the court
can compel the individual or company to follow its order.
Before its recent decision in ZF Automotive, the U.S. Supreme Court had
only addressed the application and scope of § 1782 once. The case was Intel
Corporation v. Advanced Micro Devices. In Intel, however, the proceeding was
not an international arbitration, but a case before the European Union
Commission. In Intel, the Court delineated guidelines for lower courts to apply
when assessing a § 1782 request, but it left open whether § 1782 applied to
international arbitration tribunals.
In practice, parties to international arbitration proceedings have successfully
used discovery under § 1782. For instance, in Mesa Power v. Canada, the claimant
was granted a number of § 1782 requests. In the arbitration, Canada fought the
admissibility of the evidence obtained through § 1782. But the arbitral tribunal
rejected Canada’s arguments and noted that it had chosen Miami as the seat of
the arbitration, given the possibility of obtaining evidence with the assistance
of the local courts.
When faced with a § 1782 request in the context of international arbitration,
district courts analyze whether the underlying arbitral tribunal is a “foreign or
international tribunal” in accordance with the text of § 1782. Before the recent
Court opinion in ZF Automotive, the U.S. Court of Appeals were split three to
two on the issue. While the Second, Fifth, and Seventh Circuits had ruled that
international arbitration tribunals were not “tribunals” in the sense of § 1782,
the Fourth and Sixth Circuits had held that they were.
III. PROFESSOR BERMANN’S POSITION IN THE U.S. SUPREME COURT
In ZF Automotive, a number of relevant actors in the international arbitration

community filed amicus briefs in the Supreme Court. These included Columbia
Law’s maven, Prof. George Bermann accompanied by three distinct practitioners,
arbitrators, and scholars; the International Court of Arbitration of the
International Chamber of Commerce; and the United States, represented by its
Solicitor General.
In its amicus brief, Prof. Bermann presented four core arguments in support
of the availability of § 1782 discovery in international arbitration proceedings.
First, Prof. Bermann focused on the text of § 1782. He argued that the plain
meaning of § 1782 “compels” the inevitable conclusion that the statute does
apply to international arbitration proceedings. This conclusion is supported,
according to Prof. Bermann, by Congress’s 1964 reform of § 1782. When it
SECTION 1782 DISCOVERY IN INTERNATIONAL ARBITRATION 359
amended § 1782, Congress chose to use the broad term “foreign or international
tribunal.” Prof. Bermann argued that “foreign” refers to proceedings located
outside the United States, “international” in turn denotes a proceeding
encompassing different nationalities or nations, and “tribunal” means a court
or any other authorized adjudicatory body. According to Prof. Bermann, an
international arbitral tribunal falls within the three required elements of the
phrase “foreign or international tribunal.”
Prof. Bermann also contended that Congress made no distinction among
“foreign or international tribunals.” Prof. Bermann further asserted that Congress
could have limited the use of § 1782 to aid proceedings before “judicial bodies”
or “foreign or international courts,” but it chose not to. That Congress did not
limit the application of § 1782 is telling, in Prof. Bermann’s opinion, that the
term used in the statute includes international arbitral tribunals.
Prof. Bermann then criticized certain courts that have “grafted onto” § 1782
a requirement that the “foreign or international tribunal” be State-sponsored.
Prof. Bermann referred to courts that have accepted the application of § 1782
only in investor-state arbitrations, and not in international commercial
arbitrations. Against this argument, Prof. Bermann asserted that Congress
made no distinction between different adjudicatory bodies. In fact, in the1964
§ 1782 reform, Congress repealed a requirement that a government must have
established the relevant tribunal.
Prof. Bermann also noted that other uses of the phrase “foreign or
international tribunal” along Title 28 of the U.S. Code support including
international arbitration tribunals within § 1782. Prof. Bermann underscored
that §§ 1696 and 1781, which use the terms “foreign or international tribunal,”
are applicable to international arbitral tribunals.
Second, Prof. Bermann discussed the U.S. Supreme Court’s decision in Intel.
Prof. Bermann noted that in Intel, the Court stated that the phrase “foreign
or international tribunal” was to be interpreted broadly. He also noted that
under the Court’s Intel guidelines, a district court might grant a § 1782 request
even when (i) the proceeding is at an investigatory stage and no adjudication
has been requested—as long as the proceeding may conclude in an adjudication;
(ii) the applicant is not a party to the international proceeding; and, (iii) the
documents that the applicants seek to discover under § 1782 would not be
available for discovery in the international proceeding or in an analogous
proceeding in the U.S.
Prof. Bermann further asserted that, as Intel does not establish any conditions
or restrictions to the applicability of § 1782, doing so would contravene both
Section’s 1782 and Intel’s “basic teaching.”
Third, Prof. Bermann addressed the fear of those who oppose the use of
§ 1782 in international arbitration proceedings based on the ill results that the
statute’s application would allegedly have at a policy level. Prof. Bermann first
noted that, as the Supreme Court emphasized in Intel, the competent district court
has discretion whether to grant a § 1782 request. Additionally, Prof. Bermann
observed that not only a decision on a § 1782 request is discretionary, but also
the district court has broad powers to “narrow, limit, or condition discovery”
when granting the request. These safeguards, Prof. Bermann argued, are
appropriate and sufficient to protect the benefits of international arbitration.
Prof. Bermann then addressed the “alleged risk of interfering” with arbitral
tribunals’ prerogatives that would stem from making § 1782 available in
international arbitration proceedings. Prof. Bermann countered that the Supreme
Court addressed these concerns in Intel. In Intel, the Court advised lower courts
to make sure that the application of § 1782 does not unduly burden the subjects
of § 1782 discovery. The Court also counseled lower courts to consider the
foreign or international tribunal’s receptivity to the relevant 1782 request.
Finally, Prof. Bermann referred to concerns of some lower courts on the
alleged conflict between § 1782 and Section 7 of the Federal Arbitration Act.
Prof. Bermann argued that there is no conflict between both statutes and noted
that Section 7 refers to the power of a district court to aid arbitral tribunals
seated within the court’s jurisdiction in the collection of evidence, while § 1782
concerns foreign or international proceedings.
IV. THE U.S. SUPREME COURT’S DECISION IN ZF AUTOMOTIVE
In ZF Automotive, the Supreme Court first addressed “whether the phrase

‘foreign or international tribunal’ in § 1782 includes private adjudicative bodies
or only governmental or intergovernmental bodies.” The Court noted that the
meaning of “tribunal” under § 1782 should be understood broadly as including
“any adjudicatory body.”
The Court found, however, that the words “foreign” or “international” modify
the term “tribunal” to mean an adjudicative body that exercises governmental
authority. In particular, the Court noted that in the context of § 1782 “foreign”
means “belonging to another national or country” and that thus the relevant
standard is whether the tribunal “possess[es] sovereign authority conferred
by that nation.” The Court then interpreted “international” to mean “involving
two or more nations,” which must have “imbued the tribunal with official
power to adjudicate disputes.”
The Court found support for its ruling in the history of § 1782. According to
the Court, the historical “animating purpose” of § 1782 was “comity,” understood
as an effort to improve the process of judicial “assistance and cooperation”
between the U.S. and other countries. The Court observed that extending the
scope of § 1782 to private adjudicatory bodies would not further this purpose.
The Court also referred to the Federal Arbitration Act (FAA). The Court
observed that expanding “foreign or international tribunal” to include
international commercial and investment arbitration tribunals would create
“significant tension” and a “notable mismatch” between domestic and
international arbitration. On the former, the FAA excludes pre-arbitration
discovery and only allows the arbitral tribunal to request discovery.
SECTION 1782 DISCOVERY IN INTERNATIONAL ARBITRATION 361
The Court then considered whether the two arbitral tribunals at issue
qualified as foreign or international tribunals exercising governmental or
intergovernmental authorities granted by one or more states. The Court held
that neither did.
The Court, however, noted that the ad hoc arbitral tribunal presented a
“harder question” because “[a] sovereign is on one side of the dispute, and the
option to arbitrate is contained in an international treaty rather than a private
contract.” The Court underscored that the “relevant question” was “whether
the nations intended that the ad hoc panel exercise governmental authority.”
But the Court found no evidence of such intent.
The Court observed in its conclusion that “governmental and
intergovernmental bodies may take many forms,” and cautioned that “[n]one
of this forecloses the possibility that sovereigns might imbue an ad hoc
arbitration panel with official authority.”
In doing so, the Court pointed at a number of “indications” that may be
relevant in finding whether an arbitral tribunal is “foreign or international”
under § 1782. These “indications” include whether the arbitral tribunal (i) is
a preexisting body or formed to adjudicate disputes; (ii) is created by an
international treaty itself or the sovereigns thereto contribute to its formation;
(iii) is affiliated with a sovereign; (iv) receives government funding. The Court
did not determine whether these “indications” are exhaustive or whether
lower courts should weigh them differently.
V. CONCLUSION
One may disagree with the Court’s holding in ZF Automotive and the effect
that it might have on international arbitrations in the U.S. and elsewhere. One
may particularly oppose the Court’s interpretation of the statutory language
and the history behind § 1782, as well as the lack of explanation for some of
the Court’s findings.
Yet one thing is clear. The Supreme Court did not quite solve the issue of
the applicability of § 1782 in international arbitration. What it did, was narrow
the problem. It remains to be seen how lower courts will apply the Court’s ZF
Automotive decision on investment arbitrations under the ICSID Convention,
the European Union’s Multilateral Investment Court, and certain multilateral
treaties that provide for multilateral investment courts which are permanent
and state-funded, like the Agreement between Canada and the E.U., the E.U.’s
Investment Protection Agreements with Vietnam and Singapore.
Chapter 64
WHY IS ARBITRATION GOOD FOR SMALL
STATES?
Maria Vizdoaga*
As Professor George Bermann pointed in his article on “What Does it Mean

to Be ‘Pro-Arbitration’?”, there are legal practitioners who are pro-arbitration
and those who present arguments against the international arbitration practice.
Commonly, those in favor of arbitration are involved in practicing international
arbitration as counsels, arbitrators, experts and academics, whereas those against
this practice usually represent the states, various international organizations
and other actors.
In my reflection, I discuss whether the arbitration practice is favorable to
small states. Over the past decades, the increasing number of international dispute
settlement mechanisms has been analyzed with a lot of criticism by academics.
The main concern was whether small states are significantly disadvantaged
when they engage in international dispute resolution through arbitration.
In my analysis, I use the example of the Republic of Moldova, a small
country in Eastern Europe, that has had a lengthy process transitioning from a
communist regime to a market economy. The country is still striving to achieve
a fair justice system and good democratic governance.
The Republic of Moldova has rather little experience with arbitration
mechanisms as an alternative method of dispute solving. The first law on
arbitration was adopted in 1994, and the same year, the International Commercial
Arbitration Court was established, which serves as the country’s main permanent
arbitration institution. Since 1994, the arbitration mechanism has been used
in the Republic of Moldova sporadically. For a big part, contractual parties
prefer the conventional court system over an arbitration procedure. Although
the number of arbitration institutions has increased tremendously since 1994
when the law for all types of arbitration disputes was adopted, entrepreneurs
still prefer the traditional court system. As Professor Bermann mentioned in
his paper, “to perform its function, the international arbitration regime needs
these other actors (most notably courts and legislatures) to adopt practices
that are favorable to the arbitration enterprise.” It seems that the Republic of
* Maria Vizdoaga is an Immigration Attorney at Vizdoaga Law Office in Manhattan, New
York. She holds an LL.M. from Columbia Law School, Class of 2017. Her area of practice is
business immigration law with a focus on E-2 investment visas for foreign investors who want
to establish or purchase a business in the United States by making a substantial investment. She
advises foreign investors on business corporate entity formation, compliance with local state
laws and tax issues for foreign individuals or companies.
363
Moldova has all the legislation in place that favors the practice of arbitration.
The reluctance relies with the entrepreneurs who still prefer more traditional
dispute settlement mechanisms, such as the local courts. That trend, however,
seems to have changed in the past decade and more and more companies,
especially foreign, opt for arbitration as a dispute resolution mechanism.
Choosing the arbitration system for solving disputes would be beneficial in
the following ways:
I. Unburden the court system: Arbitration would serve as a more

immediate solution to the existing problems in the justice system. The
local courts deal with a high amount of cases, especially after the
pandemic, and arbitration would significantly unburden the state
courts by taking over various contractual disputes.
II. Encouraging foreign investment: Generally, foreign investors feel
more comfortable to invest in countries that have been friendly to
arbitration and have a history of enforcing arbitral awards according
to international arbitration rules (the UNCITRAL Model Law on
International Commercial Arbitration, the New York Convention on the
Recognition and Enforcement of Foreign Arbitral Awards, the ICSID
Convention, and the European Convention on International Commercial
Arbitration). Since the country is struggling economically, foreign direct
investments would grow and the reputation of the country would
increase if more and more investors would choose to do business and
use arbitration as a method to solve disputes.
III. Fees and time: Court fees in contractual disputes are generally higher
and proceedings can take up to five years. Arbitration, however, would
entail less costs and time (between 4–6 months) for solving a dispute. So,
from a practical point of view, domestic and international entrepreneurs
could benefit from the arbitration system when it comes to the time and
fees that they can save as opposed to bringing a claim in a traditional
court.
IV. Confidentiality: Arbitration rules provide greater confidentiality to
the parties involved than the traditional litigation in local courts. Unlike
a court proceeding, arbitration is essentially a private procedure, so
that if the parties desire privacy then the dispute and the resolution
can be kept confidential, which is a great advantage for the parties
involved. It is important to mention, however, that if enforcement
through local courts is required, confidentiality might be affected in
the court proceedings and parties must comply with any mandatory
reporting obligations.
V. Choosing your arbitrator: The parties to the dispute have the unique
opportunity to choose and agree on the arbitrators, so the arbitrator
will be someone that both sides have confidence will be impartial and
fair.
WHY IS ARBITRATION GOOD FOR SMALL STATES? 365
VI. Higher expertise: In an arbitration procedure, the parties can choose

their arbitrators who have meaningful expertise in the area of the dispute
involved. If a dispute is solved through the traditional court system,
the parties have the risk that the judge might not be best qualified to
render a decision on the matter.
VII. Simplified rules of procedure: Arbitration proceedings usually have
their set of rules that make the proceedings adaptable to the needs of
the parties. Rules of civil procedure for domestic court disputes, on the
opposite, can involve lengthy and complex procedures that would add
difficulty to the dispute resolution process.
Professor Bermann concludes in his paper that “the labels pro- and anti-
arbitration do not do justice to the complexities associated with determining
where international arbitration’s best interests lie.” A more complex analysis
is needed to determine the values that are largely extrinsic to arbitration. I
believe that, in the end, it is up to the parties to decide what dispute settlement
dispute would work best for their particular case. But, it is very important that
parties understand the benefits of arbitration and how they can be different
from traditional court systems. Attorneys could be more involved in explaining
to the parties the advantages of arbitration and encourage their clients to opt
for arbitration if it makes more sense for the parties involved.
In conclusion, arbitration can be a very useful tool for resolving disputes,
but careful consideration has to be awarded as to whether it is applicable to or
preferable in a specific dispute and both parties in an arbitration proceeding
must be informed about the possible outcomes, appeal mechanisms (if any)
and the conditions associated with the enforcement of arbitral awards. For a
small country like the Republic of Moldova, appropriate arbitration legislation,
the openness of local actors to arbitration practices, and a good record of
enforcing arbitral awards could increase the foreign investment into the country,
which is very important for its economic development and creation of
employment opportunities for local people. In today’s world, small countries
must keep up with the economic and technological developments and a way to
do that is to adhere to international practices such as arbitration as an
alternative to dispute resolution in local courts.
Professor Bermann has been a distinguished mentor and a remarkable
professor in the field of arbitration for many students who developed a career
in the arbitration field, as well as for people like me who work with foreign
investors in the United States. His genuine curiosity and interest in his students’
backgrounds show that he wants us to continue his legacy at the highest level
and be important legal practitioners who will bring change to the legal profession
as it continues to evolve. Professor Bermann has had a great impact on my
professional development and confidence. For that reason, I will always have
a deep sense of gratitude and admiration for him.
Chapter 65
THE URUGUAYAN “PRO-ARBITRATION” NOTION
Mateo Verdías Mezzera*
I. INTRODUCTION: TRIBUTE TO PROF. BERMANN AND THE TWO

APPROACHES TO THE PRO-ARBITRATION NOTION
Very few have had the unique opportunity to be taught international

investment law and arbitration by the extremely knowledgeable and intellectually
curious combination of Professors George Bermann and Kabir Duggal. And
even fewer encountered, in parallel, such a smart, pioneer, and forward-thinking
group of LL.M. students as Gustavo Favero Vaughn, Gino Rivas, and Elora Farias,
are. I was one of those lucky few. Together with Gustavo, Gino, and Elora, we
committed and pushed each other to take the most out of our year at Columbia
Law School.
The idea to embark together on the creation of the very first Columbia Law
School arbitration practitioners’ Alumni book, is simply a sign of the deep
mutual professional and personal respect that we have for each other. And it is
even a greater representation of the profound personal respect and professional
gratefulness that the entire network of CLS Alumni feels towards our very own
Prof. Bermann. As someone who has shaped the legal minds of generation after
generation not only in the U.S. but worldwide, no one in the arbitration
community deserves this tribute more than Prof. Bermann. Together, we
immediately entrusted CLS Professor Kabir Duggal with the responsibility of
helping us take the project to life. Unsurprisingly as it is, he excelled and led us
through the quite arduous process that culminated in this book that we, today,
have the pleasure of not only co-direct but also to contribute to as authors. And,
from a personal standpoint, I am even more pleased to bear the responsibility
of bringing to this book a chapter dedicated to the Uruguayan—my home
country—“pro-arbitration” notion.
As Prof. Bermann has long ago thoroughly explained to the—at his
beginnings—slowly growing arbitral community, for a jurisdiction to become
“pro-arbitration” several factors may and should simultaneously come into
play. In this essay, I analyze two of them. The first considerations are policies
and regulatory approaches that favor the inclusion and enforcement of
arbitration clauses, autonomy, transparency and efficiency of the arbitral process,
access to national courts in aid of arbitration, as these are key elements. As
accurately described by Prof. Bermann, the policies of a jurisdiction are “pro-
* Mateo Verdías Mezzera is a Visiting Lawyer at the International Arbitration and Litigation
Group of Sullivan & Cromwell LLP and is a Columbia Law School LL.M graduate (‘22).
367
arbitration” if, in the aggregate, they sufficiently advance the purposes of

arbitration (George A. Bermann, “What Does it Mean to be ‘Pro-Arbitration’?”,
34 ARB. INT'L 341 (2018), p. 342). The second factor of this analysis, which is
different and yet complimentary to the first one, is the notion that the judiciary’s
conduct can amount to a “pro-arbitration” behavior. This, as Prof. Bermann has
correctly expressed, by no means entails that the judiciary disproportionately
favors a pro-arbitration consideration at the expense of elements that, while
extrinsic to arbitration, have considerable value to its utility; such inflexible
approaches in favor of arbitration, he commented, may “actually discredit
arbitration and ultimately operate to arbitration’s detriment” (ibid., 349).
Uruguay has not been indifferent to these two approaches. In the following
Sections, I analyze how favorable regulatory improvements have boosted
Uruguay to become a “pro-arbitration” jurisdiction from a legal standpoint, and
how domestic court decisions have reaffirmed such a notion from a judiciary
point of view.
II. THE LEGAL APPROACH: FAVORABLE REGULATORY IMPROVEMENTS

AND FOREIGN INVESTMENTS POLICY
Since the late ‘80s—and without prejudice to earlier although more

general regulations—Uruguay has, shortcomings notwithstanding, embarked on
a policy of facilitating access to arbitration, both from a commercial arbitration
and an investment arbitration perspective.
First, it liberalized resort to commercial domestic and international
arbitration proceedings through different statutes. Among the most relevant
ones, in 1878, it enacted the Civil Procedural Code (CPC) with several provisions
regulating domestic arbitration, which was later substituted in 1988 with the
General Procedural Code (GPC), containing an entire chapter on domestic
arbitration (notably, there were earlier references to arbitration in the
Commercial and Civil Codes of 1865 and 1868, although lacking procedural
regulations). Recently, in 2018, Uruguay enacted its first international commercial
arbitration act (“ICAA”, Act nº 19.636), a verbatim of the UNCITRAL Model Law
on International Commercial Arbitration, with some minor modifications.
Importantly, both regimes of Uruguay’s dualist system—for domestic and
international commercial arbitration—recognize the key principles of arbitration:
the Kompetenz-Kompetenz principle on its negative effect (GPC Section 475—
although it makes the effectiveness of the principle dependent on the relevant
motion of the party opposing domestic court, instead of ex officio—, ICAA
Section 8.1) and positive effect (GPC Section 475.1, Section 16.1 of the ICAA),
the separability principle (GPC Section 475.2, ICAA Section 16.1), recourse to
national courts in assistance of arbitration (GPC Section 478, ICAA Sections 6
and 9), among others. And so does the New York Convention on the Recognition
and Enforcement of Foreign Arbitral Awards (e.g., Section II(3) on the Kompetenz-
Kompetenz principle), to which Uruguay has been a party since 1983.
THE URUGUAYAN “PRO-ARBITRATION” NOTION 369
In addition, Uruguay ratified several other relevant treaties—not all of them

currently in force—which, directly or indirectly, substantially relate to arbitration.
Some of them are: (i) the Treaties of International Civil Law of 1889 and 1940
(the “Treaties of Montevideo”), (ii) the Inter-American Convention on International
Commercial Arbitration of 1975 (the “Panama Convention,” a regional reflection
of the NYC), (iii) the Inter-American Convention on the Extraterritorial Validity
of Foreign Judgments and Arbitral Awards of 1979 (the “Montevideo
Convention”), (iv) the Mercosur International Commercial Arbitration
Agreement—which, together with the almost identical agreement that the
Mercosur entered into with Chile and Bolivia relating to international
commercial arbitration, are collectively known as the “Mercosur Arbitration
Agreements”, (v) the Protocol on Cooperation and Judicial Assistance in Civil,
Commercial, Labor and Administrative Matters of 1992 (the “Las Leñas
Protocol”), relating to the enforcement of foreign arbitral awards, (vi) the
Protocol on Reciprocal Promotions of Investments within Mercosur of 1994
(the “Colonia Protocol,” applicable only intra-Mercosur), (vii) the Protocol on
Protection of Foreign Investments from Non-Parties to Mercosur, 1994 (the
“Buenos Aires Protocol,” applicable to non-Mercosur parties)—neither the
Colonia nor the Buenos Aires Protocol are in force—, (viii) the ICSID Convention,
approved in 1999, and (ix) the Protocol for the Settlement of Disputes in
Mercosur, 2002 (the “Olivos Protocol”).
Notably, Uruguay also enacted a set of laws regulating specific industries
making it optional or mandatory for the State to resolve disputes through
arbitration:
(a) Act 16.906 (Investment Promotion Act), Section 25. Under this provision,
conflicts arising out of benefits conferred considering the investment
promotion statute can be resolved either through arbitration or by
recourse to national courts.
(b) Decree 86/2001, Sections 10 and 12, by virtue of which parties have
the option to submit to arbitration all disputes arising out of acts that
violate competition laws.
(c) Act 17.703 (Trusts Act), Section 8. This statute makes it mandatory for
disputes arising out of financial trusts to be resolved through
arbitration, while optional for conflicts arising out of other trusts.
(d) Act 18.786 (Public-Private Partnerships Act), Section 54. Some
Uruguayan scholars have indicated that this statute makes it
mandatory—and not optional—for the State to have disputes arising
out of public-private partnerships concluded under this law, resolved
through arbitration (Martins, “El arbitraje en la contratación
administrativa”).
(e) Act 19.126 (Large-Scale Mining Act), Section 30. According to this act, an
arbitration clause can be agreed upon as a means to resolve all conflicts
arising out of the large-scale mining contract to be signed between the
foreign investor and the Executive Branch—a contract that, in Uruguay,

must precede any large-scale mining exploitation.
Although there are several improvements yet to be made, Uruguay’s

regulatory framework for domestic and international commercial arbitration
is growing strong and more sophisticated, positioning the country as a pro-
arbitration jurisdiction from a legal standpoint.
Second, in 1987 Uruguay embarked on a policy of consenting to resolve
investment disputes arising out of investment treaties through arbitration,
demonstrating the country’s pro-arbitration policy approach to investment
disputes. Article 6 of the Uruguayan Constitution, as enacted in 1967, indicates
that “[i]n international treaties entered into by the Republic, it shall propose
the clause that all disputes arising between the contracting parties shall be
decided by arbitration or other peaceful means.” However, a brief historical
review of international investment law shows that until before the second half
of the 20th century, many sovereign States refused to waive their immunity of
jurisdiction to have their conflicts with foreign investors resolved by an arbitral
tribunal. And Uruguay, in fact, was no exception. It took the State 20 years to
make use of the flexibility granted by Article 6 of the Constitution. When
ratifying its first bilateral investment treaty (BIT) with Germany on April 25,
1990, Uruguay agreed to include an investment arbitration clause. From that
point on, the country began a pro-investment arbitration policy which—in
terms of jurisdictional and admissibility requirements, as well as substantive
protections—gained sophistication over the years.
From 1987 to 2021, Uruguay has signed 33 BITs (without considering the
amending protocols), the vast majority of which contain arbitration clauses.
These 33 BITs—which, importantly, are not all currently in force—, were signed
with: Germany, Switzerland, Netherlands, Hungary, Italy, Romania, Poland,
United Kingdom, Belgium-Luxembourg, Spain, France, China, Malaysia, Czech
Republic, Venezuela, Sweden, Portugal, Canada, Panama, Israel, Mexico, El
Salvador, Australia, Finland, Saudi Arabia, Armenia, United States of America,
India, Korea, Vietnam, Chile, Japan, and United Arab Emirates. Concerning the
arbitral forum of these 33 treaties, 31 of them provide for the possibility of
resorting to ICSID arbitration. The exceptions are Saudi Arabia (with whom
the treaty does not contain a dispute resolution clause) and China (where the
treaty provides that the procedure may simply be “inspired” by the arbitration
process provided for in the ICSID Rules). Out of these 31 BITs, 7 provide for
compulsory recourse to ICSID arbitration if both States involved in the dispute
have ratified the Convention (these are the treaties with: Germany, Switzerland,
Poland, Netherlands, India, Hungary, and Venezuela). More specifically, these
treaties provide that in case of opting for arbitration, disputes “shall be
submitted” to ICSID arbitration to the extent available.
THE URUGUAYAN “PRO-ARBITRATION” NOTION 371
The framework under which Uruguay consented to investment arbitration

displays the country’s pro-arbitration inclination from an investment law policy
perspective.
Third, on January 1st, 2022, the new Rules of Arbitration of the Conciliation
and Arbitration Center of the Uruguayan Chamber of Commerce and Services
entered into force (whose drafting committee I had the privilege of conforming
thanks to the generous invitation of Mrs. Mercedes Jiménez de Aréchaga, one of
Uruguay’s leading experts in the field). These rules provide for greater consistency
with international practice, by allowing parties to tailor the proceedings in
terms of procedural calendars, submissions, and evidence, and by regulating
advanced features such as electronic—paperless—communications, virtual
hearings, provisional measures, emergency arbitration, expedited proceedings,
multi-party, and multi-contract arbitrations.
III. THE JUDICIAL APPROACH: JUDGMENTS FAVORING THE

SEPARABILITY AND KOMPETENZ-KOMPETENZ PRINCIPLES
In Uruguay, the jurisprudential trend displays a great respect for the

separability and the Kompetenz-Kompetenz principles, which are key to an
effective and efficient pro-arbitration framework. Since circa 1992, local tribunals
started to consistently enforce arbitration clauses regardless of whether the
applicable law therein contained was Uruguayan or foreign (Judgment
nº 67/1992, Civil Court of Appeals of 2nd Term). When faced with a dispute
encompassed by an arbitration clause, Uruguay courts conduct a preliminary
review, if any, on jurisdiction (SCJ Judgment nº 231/2005; Judgment nº 91/2005
of the Civil Court of Appeals of 7th Term), and they strictly apply the separability
of the arbitration clause principle (Judgments nº 54/2019 and nº 223/2008 of
the Civil Court of Appeals of 6th Term). In the context of enforcements, there
are at least 15 judgments issued by Uruguayan courts in application of the NYC,
most of which favored the abovementioned principles (Civil Court of Appeal of
5th Term, Judgment nº 65/2018). Notably, Uruguayan courts give arbitral
tribunals a proper “anticipatory deference”, a concept that Prof. Bermann
employs to refer to the deference that domestic courts give to the yet-to-come
ruling of an arbitral tribunal that has not yet been formed (Judgment
nº 223/2008 of the Civil Court of Appeals of 6th Term).
The approach taken towards annulments is also an indicator of how “pro-
arbitration” state courts are. Judgment nº 212/2021 of the Civil Court of
Appeal of 6th Term, dated December 13, 2021, confirmed the tradition of the
Uruguayan judiciary of reviewing petitions for annulment of awards with a
restrictive approach (see also Judgment i74/2011 of the Civil Court of Appeals
of 1st Term).
In the context of labor conflicts, two contradictory judgments created
controversy around the “pro-arbitration” notion. On May 8, 2017, the Supreme
Court of Justice held that individual and collective labor conflicts can be
resolved through arbitration (Judgment nº 598/2017), as the arbitral forum is

not legally excluded from any labor conflict considering that settlements are
possible—in Uruguay, only subject matters that are capable of being settled or
that are not expressly excluded from the arbitral forum by law, can be subject
to arbitration (GPC, Sections 476 and 472, respectively). However, on June 3,
2020, the Labor Court of Appeals of 6th Term issued Judgment nº 89/2020 in
which it understood that arbitration clauses covering individual labor actions
are contrary to Uruguayan public policy. It held that: (i) procedural labor laws
aim to amend the asymmetry that exists among employer and employee, and
that only labor courts can amend such disparity; (ii) the possibility of resolving
collective labor conflicts through arbitration is expressly set forth in the
Constitution and, thus, the Court read that individual labor conflicts were
intentionally left out from the arbitral fora. Still, and ultimately, the grounds of
the judgment come down to whether imposing an individual labor conflict
arbitration clause is abusive to employees and, therefore, invalid. Consequently,
this judgment is still consistent with the Kompetenz-Kompetenz principle,
under which the Court must refer the parties to arbitration unless it finds that
the agreement is, among others, null and void.
IV. CONCLUSION: THE RIGHT BALANCE
As Prof. Bermann wisely noted, “a policy or practice that appears to be pro-

arbitration in one respect may not only have arbitration unfriendly consequences
in other arbitration-related respects, but also in respect of considerations
having nothing specifically to do with arbitration.” (ibid., p. 349) Courts must
not mistake a pro-arbitration context for an “anti-local courts’ deference”
context. The notion of pro-arbitration is the right balance between the respect
owed by local courts to arbitration principles and the deference to be given to
arbitral tribunals, with the intervention of state courts when necessary to
safeguard the ultimate interests of justice.
Chapter 66
ARE COMITY AND SOVEREIGNTY OVER NATURAL
RESOURCES LEGITIMATE CONSIDERATIONS WHEN
APPLYING THE PUBLIC POLICY EXCEPTION TO
ENFORCEMENT OF ARBITRAL AWARDS?
Matthew E. Draper*
The pro-enforcement ethos of the 1958 Convention on the Recognition and

Enforcement of Foreign Arbitral Awards (the “Convention”) is its defining
achievement. The Convention is one of the world’s most widely adhered to
treaties. Among other things, it requires States to enforce foreign arbitral
awards save in exceptional circumstances. The public policy exception is one
of those circumstances. That exception is the safety valve that helped convince
governments to cede some of their sovereign authority to adopt the Convention.
Yet it is also regarded as the Convention’s Achilles’ heel—potentially offering
wily litigants an opportunity to encourage courts to improperly meddle in
disputes already resolved by arbitration.
This essay will focus on two recent arbitration awards governed by the
Convention that State courts then refused to enforce on public policy grounds.
These cases are interesting because they involve considerations of comity and
sovereignty over natural resources. This essay considers whether these cases
are outliers, or harbingers of the future of the public policy exception—a
matter that may be particularly significant given States’ increasing scrutiny of
the exploitation of natural resources in the face of climate change.
I. THE PUBLIC POLICY EXCEPTION TO THE ENFORCEMENT OF AWARDS
Article III of the Convention provides that States “shall recognize arbitral
awards as binding and [shall] enforce them” subject to certain rules and
exceptions. One such exception appears in Article V(2)(b), which states that
the “[r]ecognition and enforcement of an arbitral award may … be refused if …
* Matthew E. Draper, FCIArb, serves as Arbitrator and Counsel in international arbitrations
under all major arbitration rules. Over the past 20 years, Draper has acted as advocate, arbitrator,
or legal expert in over 70 international commercial arbitrations or related disputes across a wide
range of industries. Draper is a member of the ICC’s Commission on Arbitration and ADR, Chair of
the USCIB ICC/USA Sole Practitioner Committee, and Vice Chair of the Chartered Institute of
Arbitrators New York Branch. He is a Fellow of the Chartered Institute of Arbitrators and serves as
a course director and tutor for its Accelerated Route to Fellowship program. Draper served as Co-
Chair of the 2021 New York Arbitration Week. He was a member of the recently concluded ICC Task
Force on Arbitration of Climate Change Related Disputes. Draper is a graduate of Princeton
University (magna cum laude) and Columbia Law School (Harlan Fiske Stone Scholar).
373
the award would be contrary to the public policy” of the country in which
enforcement is sought.
The Convention provides no definition of “public policy” or indication as to
how Article V(2)(b) should be applied. This is both unfortunate and not
particularly surprising. As was famously said in an early English court decision:
public policy “is a very unruly horse, and when once you get astride it you never
know where it will carry you.” Richardson v. Mellish, 130 Eng. Rep. 294, 303
(1824) (Burrough, J.).
United States courts consider public policy defenses to be “circumscribed”;
possessing a “supranational emphasis” rather than serving as a “parochial device
protective of national political interests.” Parsons & Whittemore Overseas Co. v.
Societe Generale de L’Industrie du Papier (RAKTA), 508 F.2d 969, 974 (2d Cir.
1974). The public policy exception under the Convention is generally
applicable “only ‘in clear-cut cases’ where ‘enforcement would violate the forum
state’s most basic notions of morality and justice.’” Newco Ltd. v. Gov’t of Belize,
650 F. App’x 14, 16 (D.C. Cir. 2016). It is thus construed narrowly, and is available
only where an arbitral award “tends clearly to undermine the public interest, the
public confidence in the administration of the law, or security for individual
rights of personal liberty or of private property.” Enron Nigeria Power Holding,
Ltd. v. Fed. Republic of Nigeria, 844 F.3d 281, 289 (D.C. Cir. 2016).
United States courts’ narrow and rare application of the public policy
exception is driven, at least in part, by a concern that to construe the exception
more broadly may encourage courts in other Convention States to refuse to
enforce awards issued in the United States. “[C]onsiderations of reciprocity—
considerations given express recognition in the Convention itself—counsel courts
to invoke the public policy defense with caution lest foreign courts frequently
accept it as a defense to enforcement of arbitral awards rendered in the United
States.” Parsons, 508 F.2d at 974–75.
II. SOVEREIGNTY OVER NATURAL RESOURCES AS PUBLIC POLICY IN

THE UNITED STATES
The first case considered in this essay is Hardy Expl. & Prod. (India) v. Gov’t
of India, 314 F. Supp. 3d 95 (D.D.C. 2018). In Hardy, the enforcement court
rejected a petition to enforce a Convention award as violating a U.S. public
policy derived from comity and sovereignty over natural resources.
In short, the Indian subsidiary of a U.S. oil and gas exploration company
entered into a contract with the Government of India (India) to explore for
hydrocarbons in India’s territorial waters. The contract provided that upon
identifying hydrocarbons, Hardy would have two years to investigate
commercializing a gas discovery, and five years to investigate commercializing
an oil discovery. Hardy found hydrocarbons, but the parties disagreed as to
whether they were gas or oil. India considered it was gas and terminated the
agreement on the expiration of two years. Hardy believed it had found oil and
initiated arbitration.
APPLYING PUBLIC POLICY EXCEPTION TO ENFORCEMENT OF AWARDS? 375
The arbitration clause in the parties’ agreement provided for binding

arbitration of any disputes in Kuala Lumpur, Malaysia. Hardy initiated arbitration
seeking an injunction ordering India to permit it the full five years to
commercialize the hydrocarbons. Hardy presented uncontested evidence that
it had indeed found oil, not gas. The arbitral tribunal granted Hardy the relief
it sought: an order requiring India to give it three more years to commercialize
its discovery. Upon issuance of the award, the parties litigated the validity of
the award in courts in India. The Indian courts found that Malaysia, not India,
had been the legal seat of the arbitration. This decision was appealed to the
Indian Supreme Court, but proceedings moved slowly, and meanwhile Hardy
sought to enforce the award in the United States.
India opposed enforcement of the award in the United States on the ground
that it violated the “U.S.’s clear public policy preference of respecting the
sovereignty of foreign nations, including their right to control their own lands
and natural resources.” Hardy, 314 F. Supp. 3d at 110. India also argued that
the specific performance portion of the award violated Indian law. Id. The Court
responded that it “must determine whether the confirmation of the specific
performance and interest portions of the arbitral award violate the United
States’ most basic notions of morality and justice, defined by its laws and legal
precedents.” Id. at 109.
The Court opined: “[t]his case presents the Court with a unique opportunity
to balance two important U.S. public policy values: respect for the sovereignty of
other nations and respect for foreign arbitral agreements.” Id. The Court
considered that it must decide whether to enforce an arbitral “order that would
deprive a foreign nation of the ability to decide who will be able to extract and
utilize its natural resources.” Id. at 112. Thus framed, the Court concluded that
“forced interference with India’s complete control over its territory violates public
policy to the extent necessary to overcome the United States’ policy preference for
the speedy confirmation of arbitral awards.” Id. at 113. The Court reasoned,
among other things, that international comity required such a conclusion:
[C]onfirmation of this award would raise the specter of … a foreign

court confirming (or the court going further and granting injunctive relief
directly) against the United States for acts it has taken within its own
borders or respecting its own territory. Given that the United States
has not waived its sovereign immunity in its own courts against specific
performance in contract cases, it would defy comprehension that it
would be in compliance with U.S. public policy to create a situation in
which a foreign court could order the U.S. to specifically perform its
portion of a contract.
Id. at 114 (italics in original).
While comity has always been regarded as a reason to enforce foreign

arbitral awards (see Parsons, cited supra), in Hardy, reciprocity considerations
were instead used to justify the court’s refusal to enforce the award. The court
did not appear to place any weight on the fact that India was invoking the
public policy exception in order to avoid a contractual obligation.
Another United States court has denied enforcement of a Convention award
in at least one prior case on the ground that public policy encompasses
international comity. That prior case concerned recognition of a Swedish
bankruptcy proceeding in which arbitrated claims were being pursued. Victrix
S.S. Co., S.A. v. Salem Dry Cargo, A.B., 825 F.2d 709 (2d Cir. 1987). The Victrix
decision is considered to be grounded in the two countries’ (Sweden’s and the
United States) shared policy favoring efficient international bankruptcy
proceedings and protection of third-party creditors. See Rest. of U.S. Law of
Int’l Comm. and Investor-State Arbitration, § 4.16, Reporters Note cmt e. By
contrast, the Hardy decision is instead based on the assertion that a sovereign
country should not be bound by an arbitral award that enjoins it to abide by
contractual obligations to which it agreed because those obligations limit its
control over its natural resources.
Hardy’s reasoning is a departure from the majority of cases which correctly
emphasize that the Convention is an international legal obligation, not a “policy
preference.” Hardy, 314 F. Supp. 3d at 113. Despite the flaws in the court’s analysis,
the question remains whether its decision reflects a broader acceptance of
sovereignty and comity as elements of public policy.
III. FRENCH “INTERNATIONAL PUBLIC POLICY” ALSO ENCOMPASSES

SOVEREIGNTY OVER NATURAL RESOURCES
The second enforcement decision considered in this essay is a

contemporaneous action before the Paris Court of Appeal. MK Group v. Onix.,
Paris, 16 January 2018, n°15/21703 (Paris Ct. of App.). This case raised similar
considerations of reciprocity and again implicated a State’s sovereignty over
its natural resources. However, in MK the foreign sovereign was not a party to
the contract or the arbitration.
MK concerned an agreement to sell shares in a Lao mining company from
MK Group to Onix. There were two versions of the agreement, one in English
and one in Lao. The two versions were identical except that the latter, which
was created to present to the Lao government to obtain regulatory approval
for the share transfer, provided that Onix was required to invest $12.5 million
in the mining operations (a provision lacking in the English version). A Paris-
seated arbitral tribunal issued an award enforcing the English version of the
agreement and declaring the share transfer completed. MK argued to the Paris
Court of Appeal that the award should be set aside on the ground that Lao
regulatory approval had been fraudulently obtained, and to enforce the award
would be contrary to the loi de police of Lao. This echoed the position of the
Laotian courts, who had refused enforcement of the award on the ground it
violated local mandatory rules.
APPLYING PUBLIC POLICY EXCEPTION TO ENFORCEMENT OF AWARDS? 377
The Paris Court of Appeal found that Lao public policy was relevant only to
the extent it coincided with the French conception of international public
policy. Nevertheless, the court found that Laos’ requirement that investments
be authorized reflected international public policy, citing to UN General Assembly
Resolution 1803 (XVII) of 14 December 1962, entitled “Permanent Sovereignty
over Natural Resources” (the “Resolution”). The Resolution provides, among
other things, that State authorization of the development and disposition of
natural resources should be subject to local law. Id. at ¶ 2. The Paris Court of
Appeal thus found that there is an “international consensus,” recognized under
French public policy, that States have the right to require pre-authorization of
investments in accordance with local law. Finding that the authorization of the
government of Lao had been fraudulently procured, the French court then
declined to enforce the award.
IV. IS COMITY A BASIS FOR EXERCISING THE PUBLIC POLICY EXCEPTION?
There are important differences between the Hardy and MK decisions. But
there are also some illuminating similarities.
The MK court, like the Hardy court, refused to enforce an otherwise valid
arbitral award on the basis that it violated another State’s sovereign control of
its natural resources. In both cases the arbitral tribunal awarded specific
performance or declaratory relief that effectively overrode the host state’s
objections as to who could seek to exploit those resources. In both cases the
courts found that the award contravened the law of the place of performance
of the underlying contract, but neither court found this fact alone to be
sufficient. Rather, the critical factor, for each court, was that the law at the place
of performance was identical to the public policy of the place of recognition or
enforcement, and that that public policy had been violated.
This notion of comity as a basis for invoking the Article V(2)(b) public policy
exception is rare, and rightly so. Article V(2)(b) clearly states that recognition
of an arbitral award “may … be refused if the competent authority in the country
where recognition and enforcement is being sought” finds that the award
would be contrary to its public policy—not the public policy of any other country.
Nevertheless, there is a place for comity in public policy, as cases like Victrix
clearly show.
V. IS SOVEREIGN CONTROL OVER NATURAL RESOURCES A BASIS FOR

EXERCISING THE PUBLIC POLICY EXCEPTION?
The courts in both Hardy and MK found that respect for sovereign control
over natural resources is sufficient to invoke the public policy exception to
enforcement, trumping the treaty obligation to enforce arbitration awards absent
exceptional circumstances. This stance is novel, and it is potentially problematic.
Neither court cites to prior authority in support of the notion that sovereign
control over national resources implicates “the forum state’s basic notions of
morality and justice.” Newco Ltd., 650 F. App’x at 16.
No appeal was sought in either case. It is, however, noteworthy that 40
years ago, the Court of Appeals for the District of Columbia vacated a lower
court’s similar refusal to enforce a foreign arbitral award based on public policy
considerations regarding sovereign control over natural resources. See, Libyan
Am. Oil Co. v. Socialist People’s Libyan Arab Jamahirya, 482 F. Supp. 1175 (D.D.C.
1980) (vacated by Libyan Am. Oil v. Socialist People’s Libyan Arab Jamahirya,
684 F.2d 1032 (D.C. Cir. 1981)). In that case, Libya expropriated the property
of the claimant oil company and was awarded compensation by the arbitral
tribunal. The lower court ruling, which set aside the award due to the act of
state doctrine, was vacated by the court of appeals. Had Hardy been appealed,
it is possible it could have met the same fate.
It is thus possible that the Hardy and MK cases are anomalies. On the other
hand, they are consistent with a criticism of investor-state arbitration as not
being sufficiently sensitive to the interests of States. These cases may represent
the beginnings of a broader trend of the use of the public policy exception to
afford States greater deference over issues concerning their natural resources.
In that vein, it is notable that one of the few multilateral treaties that is more
widely adhered to than the Convention are the 2015 Paris Accords, in which
States have agreed to continue to reduce greenhouse gas emissions.
The entrenchment of a broader conception of public policy in otherwise
pro-arbitration jurisdictions such as the United States and France may adversely
impact international arbitration. On the one hand, a broader conception would
seem to directly undercut the pro-enforcement philosophy of the Convention.
On the other hand, legitimacy in the eyes of governments and public opinion
cannot be ignored. As Professor Bermann has argued, determining:
whether a policy or practice is or is not pro-arbitration [requires]

consideration of values that are largely extrinsic to arbitration itself. In
fact, acknowledging legitimacy—measured in terms of extrinsic values—
as in itself a pro-arbitration attribute may be among the most arbitration-
friendly moves one can make.
George A. Bermann, What Does it Mean to Be “Pro-Arbitration”?, 34 ARB. INT’L

341, 353 (2018).
The question here is whether increased deference to other sovereigns’

control over their natural resources will boost the legitimacy of arbitration,
outweighing any marginal decrease in the certainty of enforcement of arbitral
awards. In the meantime, the Hardy and MK decisions illustrate how the public
policy exception to enforcement, when driven by comity considerations and
perceived sovereign control over natural resources, may indeed be an “unruly
horse” that is just as easily pro-arbitration as not.
Chapter 67
ISDS IN A DEVELOPING COUNTRY CONTEXT -
IMPLEMENTABILITY AND IMPLEMENTATION AS
“PRO-ARBITRATION” VIRTUES
Maximilian Philip Eltgen*
I. INTRODUCTION
Reflecting upon whether a policy or practice should be considered “pro-

arbitration”, Professor Bermann in a recent article wisely argues that “too often
missing (..) is consideration of values that are largely extrinsic to arbitration
itself. In fact, acknowledging legitimacy—measured in terms of extrinsic values—
friendly moves one can make.“ [George A. Bermann, What Does it Mean to be
“Pro-Arbitration”?, 34 ARB. INT’L 341 (2018), p. 353].
Nowhere does this assertion ring truer than in the increasingly contested
field of investment arbitration. Even though Professor Bermann in his article
mainly refers to international commercial arbitration, noting that it is difficult
to separate arbitration as a foreign investment dispute resolution from foreign
investment law and policy, it is worth examining to what extent currently
discussed ISDS measures are “pro-arbitration”, what values extrinsic to
arbitration should be taken into consideration in measuring their contribution
to legitimacy, and, importantly, how these values may change in different
country contexts.
This essay explores the question of what it means to be “pro-arbitration”
when assessing ISDS in a developing country context. Following a brief review
of popular ISDS reform proposals, it is argued that these proposals—while they
may be “pro-arbitration”—fail to address one of the most important extrinsic
values for developing countries: the promotion of economic development. To
leverage ISDS in the context of development, policymakers—and arguably also
the international arbitration community—should focus attention on two often
overlooked “pro-arbitration” virtues: the implementability and implementation
of investment protection guarantees.
* Maximilian Philip Eltgen is a Private Sector Specialist in the World Bank Group’s
Investment Climate unit. As a Global Alliance student, Maximilian studied under Professor
Bermann at both Columbia Law School and Sciences Po Law School.
This “Festschrift” contribution was written in honour of Professor Bermann, whose unique
blend of intellectual brilliance and magnetic charisma have served as a great source of
inspiration to Maximilian, during his studies and beyond.
379
II. THE “PRO-ARBITRATION” NATURE OF ISDS REFORM PROPOSALS
A wide number of reform proposals are currently being discussed to address

the concerns that have been raised regarding ISDS, including in international
fora such as the UNCITRAL Working Group III.
One group of reform proposals aims to improve the underlying IIA standards
to provide more clarity regarding the protection offered to investors, and to
increase the regulatory space of host states. Other proposals are more concerned
with the arbitral procedure, seeking to, inter alia,
• address an alleged lack of consistency, coherence and predictability of

arbitral decisions (e.g. by allowing for joint treaty interpretations or
introducing appellate mechanisms);
• improve arbitrators’ independence and impartiality (e.g. by developing
better rules and procedures for arbitrator challenges or tightening
codes of conduct);
• reduce the costs and duration of ISDS cases (e.g. through a stronger
focus on dispute prevention and ADR, or by introducing cost-saving
mechanisms); and
• promote transparency (e.g. by opening up procedures to the public or
allowing for amicus curiae submissions).
Whether or not specific proposals can be considered “pro-arbitration” is

discussed in other contributions to this volume, and ultimately depends on the
nature and context of each measure, the definition of “pro-arbitration” one
adopts, as well as the trade-offs that need to be considered.
What seems clear even without a detailed examination, however, is that
the motivation of many of these measures is precisely the one Professor Bermann
also emphasizes in the context of international commercial arbitration, namely
to consider values extrinsic to arbitration to secure the legitimacy that confers.
An obvious example is the aim of improving transparency, which is pursued
despite transparency in some ways being the antithesis of arbitration
traditionally conceived and clearly clashing with cost- and time-efficiency
concerns.
At the same time, this raises the question to what extent these proposals in
fact appropriately align with a given society’s values, in other words whether
they address the issues that matter in that society. While the answer to such
question by its nature depends on the specific country context, the next section
argues that for the broader group of developing countries, the reform
proposals may only partially address societal values.
ISDS IN A DEVELOPING COUNTRY CONTEXT 381
III. VALUES EXTRINSIC TO ARBITRATION IN A DEVELOPING COUNTRY

CONTEXT
Many of the reform proposals mentioned above have in one or the other
way the intention—even if they may over- or undershoot—to improve investor-
State arbitration. However, it is questionable whether goals such as improving
transparency, increasing the independency and impartiality of arbitrators, or
addressing a lack of consistency in arbitral decisions—even though they are
important goals—touch the core of what many societies would demand from
a functioning ISDS system. Especially in the context of developing countries,
arguably one of the main demands from ISDS is to promote economic
development, a value the reform proposals fail to directly address.
These considerations beg the question how ISDS can be designed to maximize
development benefits for developing countries. Three potential benefits are
commonly proposed in this regard:
(i) Attracting FDI: In this context, ISDS is often conceptualized as a specific

investment protection guarantee that helps attracting FDI by reducing
political risk. Yet, while the development benefits of FDI are well
documented, the relationship between offering ISDS and attracting FDI
is less so. Empirical evidence on the effect of BITs on FDI flows is mixed
at best, let alone empirical evidence on the relationship between ISDS
and FDI, which is sporadic.
Moreover, even though investor perception surveys consistently—
but also expectedly—show that investors attribute high significance
to investment protection, they also show that other factors, especially
economic factors, are much higher on the priority list of prospective
investors, although there may be important exceptions for specific
sectors such as extractives in the existence of ISDS is relevant as an
investment determinant.
Considering the case studies of countries that have consistently
attracted high levels of FDI despite not providing for ISDS (Brazil) or
at least traditionally only providing for limited access (China), and given
the countless of examples of countries that attracted only little FDI
despite providing for ISDS, it seems fair to conclude that ISDS is neither
a sufficient nor a necessary condition for attracting FDI.
(ii) Depoliticizing disputes: A second argument often made in favour of

ISDS in the context of promoting development is its “depoliticization
effect”. In the absence of ISDS, the argument goes, developing
countries as relatively weak actors may be unduly influenced by
dominant home states or powerful investors when acting as host
states. Moreover, depoliticization might also benefit developing
countries as home state, since investors under ISDS may bring cases
against powerful host states that their home states would have little
probability in winning in the diplomatic arena. However, while in
theory this argument is plausible, empirical evidence is weak that
depoliticization effects take place in practice.
(iii) Improving governance and the rule of law: Perhaps the most
promising positive effect ISDS may have on developing countries is to
improve governance and the rule of law. When signing onto IIAs,
countries ideally adapt their regulatory framework to international
obligations they have undertaken and build institutions that uphold
standards such as transparency, stability, predictability, or consistency.
This should occur ex ante treaty signature, but importantly also ex
post to avoid litigation. ISDS in this sense functions as the proverbial
stick to enforce good governance. Yet, to have this effect, it is crucial
that IIAs are effectively implemented—otherwise, the result could be a
wave of disputes causing harm to both host state and foreign investors.
IV. IMPLEMENTABILITY AND IMPLEMENTATION AS

“PRO-ARBITRATION” VIRTUES
ISDS can potentially be a useful tool in a development context, even if some

of its benefits may be overstated and not empirically validated. But to that end,
it is not sufficient for ISDS reforms to merely focus on fostering transparency,
increasing the independency and impartiality of arbitrators, or addressing a
lack of consistency in arbitral decisions. To align ISDS with the societal virtue
most important to many developing countries—promoting development—
requires the consideration of two often overlooked factors which may serve as
important “pro-arbitration virtues”: implementability and implementation.
Implementability in this context refers to the feasibility of implementing
specific protection guarantees. Since, as described above, one of the main
functions of ISDS in developing countries is to promote governance and the
rule of law, it is crucial that protection guarantees included in IIAs or domestic
laws are drafted in a way that they are easily understood. They should be
sufficiently clear to lawyers without an investment law background, and arguably
even to non-lawyers, since lack of capacity is a prevailing issue in many developing
countries. While investment law expertise may be present in some parts of
governments, for example in those negotiating BITs, it is often not found in
sub-national or sector-specific agencies which are precisely the entities that
most commonly cause disputes and should therefore be the primary
addressees of ISDS conceptualized as a governance mechanism.
Concretely, the “fair and equitable treatment” (FET) standard may serve as
an example to illustrate this point. Even among longstanding arbitration
practitioners, it may be difficult to find agreement on the exact meaning this
ISDS IN A DEVELOPING COUNTRY CONTEXT 383
standard entails. For non-specialists in developing countries, it may be close to

impossible to devise policies that can be guaranteed to be in compliance with
the standard, or to know which actions may or may not be in violation of it. In
other words, an unqualified FET standard is not easily implementable. Thus, it
may be preferable to concretely list out specific elements of the standard—for
example specific transparency obligations—to achieve a better development
outcome and not just provide protection for the sake of protection while
potentially causing a flurry of ISDS disputes.
Importantly, implementability should not be confused with providing
regulatory space, another important policy concern. Both policy goals may be
complementary, but one may also counteract the other. For example, one
reform proposal to increase regulatory space is to limit FET to the minimum
standard of treatment under customary international law (CIL). However, while
this reform may or may not be desirable, it does not increase the implementability
of FET, since the link to CIL does not necessarily make the standard more
understandable.
Since increasing the implementability of provisions improves the
effectiveness of ISDS as a governance tool, implementability should be considered
a “pro-arbitration” virtue. At the same time, as Professor Bermann would remind
us, increasing implementability also inevitably comes with trade-offs, most
notably losing the advantage of having a less-defined standard to account for
a variety of circumstances rather than relying on more rigid rules. But at least
in a developing context, this may be well justified.
A second important “pro-arbitration” virtue is implementation. Without
effectively implementing investment protection guarantees by creating
mechanisms enabling the government to comply with them, providing for ISDS
is likely to lead to a wave of disputes which are costly and contribute little to a
country’s development.
Yet, implementation is not a straightforward task. As mentioned above,
many of the agencies causing disputes are sub-national or sector-specific
agencies, for several reasons. There may not only be a lack of capacity to
implement obligations, but also information asymmetries—some agencies may
not even know of the existence of investment law obligations. Moreover, states
are multi-layered organizations, and agencies which attract and facilitate
investment are often not the ones dealing with investors on a daily basis and
may thus cause disputes. In addition, many agencies may have different priorities,
which may not be to comply with treaties or investment protection laws.
To promote implementation, it is important to improve implementation
capacity regarding investment legislation. This includes knowledge sharing,
but also building coordination mechanisms between agencies. It also requires
promoting dispute prevention and, at an earlier stage, investor grievance
management. An effective grievance mechanism has not only the potential to
prevent disputes, but through effective information sharing and coordination
mechanisms may spread knowledge about investment protection obligations,
thus promoting their implementation. Importantly, while ISDS itself is not

effective in implementing these instruments, it can become an effective tool
when supplemented by appropriate implementation mechanisms.
V. CONCLUSION
ISDS reform efforts should to a greater extent consider specific country

contexts, in particular those of developing countries. These countries have
potentially the most to gain from an effective ISDS system, but are also most
likely to suffer from an ineffective system, particularly in a post-COVID context
when already slim fiscal budgets are at risk of being further constrained by
costly arbitration awards.
While ISDS has the potential to be an effective tool to foster development,
particularly by improving governance and the rule of law, it needs to be based
on implementable investment protection guarantees and complemented by
comprehensive implementation programs in the form of capacity building
initiatives as well as dispute prevention and grievance management mechanisms.
In the absence of such efforts, the likely results are waves of disputes which
add little to development, but rather may result in a further erosion of confidence
in ISDS.
Thus, it should also be in the arbitration community’s interest to actively
contribute to offer comprehensive ISDS packages that also focus on
implementation to developing countries. Even though it may seem at first
paradoxical, being ‘pro-arbitration‘ may in fact require the arbitration community
to accept a decline or stagnation of the number of disputes, and even to promote
solutions that work towards that goal, even if the results are foregone profits.
Or, as Professor Bermann puts it, “it may actually be in international arbitration’s
best interests to advance values that are themselves extrinsic to arbitration even
if doing so comes at some price to the interests of arbitration narrowly conceived.“
[George A. Bermann, What Does it Mean to Be “Pro-Arbitration”?, 34 ARB. INT’L
341 (2018), p. 352].
Chapter 68
WHAT DOES IT MEAN TO BE
“PRO-ARBITRATION”?: REFLECTIONS ON
PROFESSOR GEORGE BERMANN’S LEGACY, IN THE
CONTEXT OF JUDICIAL INTERVENTION IN
SINGAPORE
Meera Rajah*
Singapore is a jurisdiction which, consistent with its aspiration to be the

Asian hub of arbitration (see Professor Michael Pryles, Singapore—The Hub of
Arbitration in Asia, in CONTEMPORARY ISSUES IN INTERNATIONAL ARBITRATION AND
MEDIATION: THE FORDHAM PAPERS (2012) (Arthur W. Rovine ed., 2013)), is often
characterized as steered by a “pro-arbitration” philosophy. That, of course,
begs the question of what to be “pro-arbitration” means, and, the corollary, “is
the generally-accepted conception of ‘pro-arbitration’ posited within Singapore
entirely consistent with international arbitration’s core interests?”
The Singapore International Commercial Court (SICC) recently defined
Singapore courts’ policy of “minimum curial intervention,” by “read[ing] awards
without seeking to construe them as a statute or adopting an overly technical
stance, with a view to according them the finality that an arbitration is intended
to bring about,” as “essentially pro-arbitration” (see CKG v. CKH [2021] 5 SLR
84 at ¶ 7 (“CKG v. CKH”), per Jeremy Lionel Cooke IJ). A leading Singapore
treatise also considers Singapore as being “pro-arbitration” because its courts
have “set aside an arbitration award in only a handful of decisions… generally
confined to domestic arbitral awards” (see Singapore International Arbitration:
Law and Practice (2d ed), 338). In fact, parties even consider it fashionable to
portray their arguments as “pro-arbitration” (see, e.g., CDM and another v CDP
[2021] 2 SLR 235 at ¶ 49; BTN and another v. BTP and another [2021] 1 SLR 276
at ¶ 67), in an attempt to bolster their submissions with the Singapore courts,
following the Singapore Court of Appeal’s watershed pronouncement in Tjong
Very Sumito and others v. Antig Investments Pte Ltd [2009] 4 SLR(R) 732 at
¶¶ 28–29. In Tjong Very Sumito, the Court observed, as early as 2009:
There was a time when arbitration was viewed disdainfully as an inferior

process of justice. Those days are now well behind us. An unequivocal
* Meera Rajah (MCIArb; MSIArb) is an Associate at Sidley Austin LLP; a LL.B. (Hons)
Graduate from University College London; a LL.M. James Kent Scholar from Columbia Law
School; an Attorney and Counselor-at-Law of New York State; an Advocate & Solicitor of
Singapore; and a Solicitor of England & Wales.
385
judicial policy of facilitating and promoting arbitration has firmly taken

root in Singapore. It is now openly acknowledged that arbitration, and
other forms of alternative dispute resolution such as mediation, help to
effectively unclog the arteries of judicial administration as well as offer
parties realistic choices on how they want to resolve their disputes at a
pace they are comfortable with… … [T]he role of the court is now to
support, and not to displace, the arbitral process.
However, in recent years, there have been more Singapore decisions setting
aside arbitral awards (see, e.g., CAJ and another v. CAI and another appeal [2021]
SGCA 102 (“CAJ v. CAI”); Sai Wan Shipping Ltd v. Landmark Line Co, Ltd [2022]
SGHC 8 (“Sai Wan Shipping”), where the Singapore courts set aside awards for
breaches of natural justice). Does this mark a shift behind the wheel, away
from Singapore’s “pro-arbitration” approach? For the reasons that follow, I
would say “no.”
In arguably the most acclaimed paper published on the topic to date
(“What Does it Mean to be ‘Pro-Arbitration’?,” 34 ARB. INT'L 341 (2018)),
Professor Bermann challenged us to rethink arid, parochial notions of what it
truly means to be “pro-arbitration” (or, put differently, “arbitration-friendly”). As
he astutely observed, with a myriad of colorful examples, there are a “multiplicity
of metrics” for identifying what is “pro-” and what is “anti-arbitration.” The
concept of what it truly means to be “pro-arbitration” cannot, and should not,
be simplistically confined to protecting the finality of all arbitral awards—it is
far more complex, subtle, and deeply-nuanced. It is important not to myopically
sacrifice clarity as to what being “pro-arbitration” entails—with full cognizance
of all the metrics that determine the global longevity of arbitration’s popularity
and success—at the altar of finality. Exploring what to be “pro-arbitration” means,
au fond, Professor Bermann parses that “a policy or practice is arbitration-
friendly to the extent that it favors the achievement of international arbitration’s
purposes, whatever we take them to be.” While minimum curial intervention
can certainly be perceived as one such purpose, other non-exhaustive purposes
include ensuring “that the resulting award will be an effective one,” “the
independence and impartiality of arbitrators,” that parties have been granted
due process, and that arbitrators do not exercise jurisdiction beyond what the
parties have granted them vide the parties’ agreement to arbitrate. After all,
arbitration is a creature of contract, and the tribunal’s powers are limited to
what the parties contractually intended to bestow upon them, subject, of
course, to certain caveats, such as public policy considerations. In this regard,
Professor Bermann insightfully observes:
[P]rivileging a particular pro-arbitration value may easily prejudice one

or more others, with the result that what appears to be pro-arbitration
when viewed through one lens may be quite arbitration unfriendly when
viewed through another. If a policy or practice that is pro-arbitration
REFLECTIONS ON PROFESSOR GEORGE BERMANN’S LEGACY 387
when viewed in isolation is prejudicial enough to one or more other

pro-arbitration values, then it may ultimately not be pro-arbitration at
all, or at least a great deal less pro-arbitration than initially thought …
One way to ascertain whether a given policy is on the whole pro-

arbitration is to proceed in cost–benefit terms, …. assessing whether
the contribution of a policy or practice to one pro-arbitration value is
greater or lesser than the disservice it does to another… … [I]f a policy
or practice sufficiently enhances arbitration’s legitimacy, or at least
avoids discrediting it, that policy or practice may legitimately be regarded
as in itself decidedly arbitration-friendly[.]
The legitimacy of arbitral awards, and the integrity of the proceedings that
precede them, must determine whether treating an award as final, with
minimal or no curial intervention, is, in fact, “pro-arbitration.” Plainly, upholding
a questionable award would threaten to undermine public confidence in
international arbitration and, to echo his concern, “actually discredit” arbitration
and ultimately operate to its detriment. From this vantage point, diverging
from some Singapore legal literature, curial intervention is not necessarily, as
these sources imply, “anti-arbitration.”
To maintain confidence in arbitration, as a mode of dispute resolution,
then, as Lord Hewart famously observed in Rex v. Sussex Justices [1924] 1 KB
256, “[j]ustice must not only be done, but must also be seen to be done.” There
are serious, sometimes conflicting, accountability concerns at play here, and
“accountability” is both a “pro-arbitration” value as well as one “external” to
arbitration, which features at the heart of every functioning legal system. In
Professor Bermann’s words, “the international arbitration community must
strive to ensure that, in addressing the concerns and pursuing the values most
closely associated with arbitration practice and its efficacy, it does not fall
seriously out of step with extrinsic values to which the legal system as a whole
attaches fundamental importance.” What is most important is the determination
of where, long-term, arbitration’s best interests lie. As Professor Bermann
recognizes:
[A]cknowledging legitimacy—measured in terms of extrinsic values—

friendly moves one can make.
Justifiable interference by the courts—in stark contrast to just “minimal

curial intervention” (cf. CKG v. CKH at ¶ 7)—is, in fact, arguably more “pro-
arbitration” than allowing awards that threaten to undermine public confidence
in international arbitration to stand.
In CAJ v. CAI, Singapore’s highest court, the Court of Appeal, upheld the
High Court’s decision to partially set aside an award issued by a three-person
International Chamber of Commerce (ICC) tribunal last November, declining to

remit the award back to the tribunal. The arbitration centered around issues
concerning excessive vibrations in the compressors of the hydrogen unit of a
polycrystalline silicon plant, which remained unresolved by the contractual date
for mechanical completion, notwithstanding some rectification works carried out
in a piecemeal fashion, pursuant to the instructions of the respondent’s subsidiary.
The appellants initially objected to the respondent’s claim for liquidated damages
due to a 144-day because of the vibrations on a two-fold basis, namely that:
(i) mechanical completion had been achieved on time, as the vibrations did not
materially affect the operation or safety of the plant; and (ii) the respondent had
waived, or was estopped, from asserting this damages claim, as any delay was a
result of its subsidiary’s instruction. However, in their written closing submissions
(well after an eight-day hearing), the appellants raised a new defence, arguing, for
the first time, that they were contractually entitled to an extension of time to
reduce the damages payable (the “EOT Defence”).
Disregarding the respondent’s arguments that the tribunal should not
consider this new EOT Defence on grounds of procedural unfairness, the tribunal
found that the appellants were liable to pay damages for a 99-day delay and,
without clearly articulating any legal basis, allowed the EOT Defence—which
further reduced damages to a 74-day delay. Unhesitatingly, the Court of Appeal
agreed with the High Court, inter alia, that: (i) the Tribunal had acted in excess
of its scope of jurisdiction, as there was “simply no room” to argue that the EOT
Defence—which was “necessarily fact-sensitive”—was somehow within the
scope of the arbitration, when the appellants conceded that it had never been
“expressly raised” in the pleadings, the list of issues, or the terms of reference;
and (ii) this was a “classic case” of a breach of natural justice, as without a “fair
and reasonable opportunity” to engage with evidence and arguments relevant
to the EOT Defence, the respondent’s rights were materially prejudiced.
In an even more recent judgment issued in January 2022, Sai Wan Shipping,
the Singapore High Court set aside an award issued following a sole arbitrator’s
final and peremptory order that the respondent serve its defence submissions
by a specified date and hour, with the stipulated sanction that, upon non-
compliance, they would be barred from advancing any positive case by way of
defence or counterclaim. After refusing to allow the respondent to adduce any
evidence, in accordance with this ruling, the arbitrator had made an award
against the respondent (despite its subsequent requests for permission to
respond, after the claimant adduced further evidence), on a documents-only
basis, as requested by the claimant. Finding that “hurry (demanded of one side
but not the other) ha[d] indeed buried justice,” the court found there to have
been a breach of natural justice that prejudiced the respondent’s rights.
Are these awards “pro-arbitration,” on balance? I would argue yes, decidedly
so. Even though judicial intervention means that the arbitral awards rendered
are not final, a competing “pro-arbitration” value is ensuring that arbitrators
comply with the fundamental concepts of due process and natural justice,
REFLECTIONS ON PROFESSOR GEORGE BERMANN’S LEGACY 389
which should form the bedrock of all proceedings—protecting this value, in

such instances, arguably trumps the value of “minimal curial intervention,” to
distinctly serve arbitration’s more long-term interests. As Professor Bermann
sagely observes, “[n]ot only tribunals, but also courts face the challenge of
choosing, or finding a compromise, between two pro-arbitration values.”
Where a tribunal acts in excess of their authority, the Court has to balance,
inter alia, competing concerns of: (i) giving effect to the probable intentions of
the parties, by setting aside decisions in excess of such authority; and (ii) not
unduly fettering tribunals’ discretion, which could be perceived by, among
others, the public and other jurisdictions as “anti-arbitration.”
However, there are, of course, limits. This presents the classic dilemma of
“who will guard the guardians?”—or, phrased differently, “what is out-of-bound
territory, if any, that local courts strictly refrain from trespassing into?” As
correctly observed by the Singapore Court of Appeal in Soh Beng Tee & Co Pte Ltd
v. Fairmount Development Pte Ltd [2007] 3 SLR(R) 86 at ¶ 62, “[a]ggressive
judicial intervention can only result in the prolonging of the arbitral process
and encourage myriad unmeritorious challenges to arbitral award by dissatisfied
parties… an interventionist approach can lead to indeterminate challenges,
cause indeterminate costs to be incurred and lead to indeterminate delays.”
Consistent with the Restatement of the US Law of International Commercial
and Investor–State Arbitration (see, specifically, s 4–14, cmt c.), the limit should
be the merits of each award. In attacking the grounds on which the ICC tribunal
had decided in favor of the EOT Defence on the merits—instead of just focusing
on the fact that the respondent had insufficient opportunity to respond—the
Court of Appeal in CAJ v. CAI arguably went at least one step too far. In its
decision, the Court even criticized the ICC tribunal for relying on “unarticulated
experience” and remarked that the tribunal’s own experience dealing with
extension of time claims for other construction projects was “immaterial”
without the benefit of pleadings, specific factual and expert evidence, and
arguments. The “pro-arbitration” value of preserving public confidence in
arbitration, by keeping arbitrators accountable, must be weighed against that
of ensuring that, in Professor Bermann’s words, they can “operate without fear
of reprisals” from local courts criticizing their factual findings or experience.
While other works by Professor Bermann have been cited by the Singapore
courts (see Dyna-Jet Pte Ltd v. Wilson Taylor Asia Pacific Pte Ltd [2017] 3 SLR
267 at ¶ 156, citing the UNCITRAL Guide on the New York Convention), his
groundbreaking paper and astute insights as to what the concept of “pro-
arbitration” actually embraces will certainly generate more focused conversations
as to what it truly means to be “pro-arbitration”, especially in this day and age
when, as he puts it, “the arbitration enterprise, rightly or wrongly, is coming
under attack as just about never before.”
Chapter 69
ENHANCED TRANSPARENCY: THREAT TO
ARBITRATION OR PRO-ARBITRATION
ENDEAVOR?
Mercédeh Azeredo da Silveira*
The fate of international arbitration is in the hands of states. Not only the
efficacy but also the very existence of arbitration are determined by national and
international laws. If agreements to arbitrate disputes and awards issued by
arbitral tribunals have binding effect, it is by virtue of national and international
laws conferring upon them such effect. It is also by virtue of such laws that
agreements to arbitrate and arbitral awards may be enforced by domestic courts.
While national laws may be more or less “pro-arbitration”—in that they
may, for instance, subject the validity of an arbitration agreement to fewer or
more ample requirements, define more or less broadly the realm of arbitrable
disputes, and limit more or less the grounds for appeal of an arbitral award—
all laws that recognize the binding effect of arbitration agreements and arbitral
awards are arbitration-friendly to the extent that they usher in an alternative
to domestic litigation.
It is, however, self-evident that such arbitration-friendliness presupposes
that arbitral policies and practices comply with fundamental values and
principles which underlie the legal systems of states called upon to recognize
arbitration as a legitimate means of dispute settlement. As Professor Bermann
observes, “courts cannot be expected to unfailingly promote arbitration’s efficacy
at the expense of broader considerations or show complete indifference as to
whether their treatment of arbitration agreements, arbitral proceedings, and
arbitral awards comports with the values that govern their treatment under
law of comparable undertakings” (George A. Bermann, “What Does it Mean to
Be ‘Pro-Arbitration’?”, 34 ARB. INT’L 341 (2018) at 352).
In light of this, the question arises whether the privacy and confidentiality
that have traditionally featured as some of the hallmarks of arbitration, do not
in fact jeopardize its existence.
* Mercédeh Azeredo da Silveira, Ph.D., is a Founding Partner at AZHA Avocats – Attorneys-

at-Law (Geneva, Switzerland), a boutique law firm which specializes in international arbitration
and economic sanctions. She sits as arbitrator and acts as counsel in international commercial
and investment arbitration proceedings, and regularly serves as expert on economic sanctions
as well as on issues at the crossroads between public and private international law. She teaches
“Economic Sanctions and International Arbitration” at Sciences Po Law School in Paris, is the
author of multiple publications including the award-winning treatise “Trade Sanctions and
International Sales: An Inquiry into International Arbitration and Commercial Litigation”, and is
one of Switzerland’s designees to the ICSID Panel of Conciliators and Arbitrators.
391
Public access to court proceedings is a fundamental right enshrined in the

Universal Declaration of Human Rights and in the European Convention on
Human Rights. Article 10 of the former guarantees the right to a public hearing,
while Article 6 of the latter guarantees the right to a public hearing as well as
to a publicly-pronounced judgment.
By contrast, international arbitration proceedings may be private and even
confidential. Nothing in the 1958 New York Convention on the Recognition and
Enforcement of Foreign Arbitral Awards (the “New York Convention”) even
suggests that arbitral proceedings or arbitral awards should be accessible to
the public. Virtually no national arbitration statute affords any third party the
right to attend arbitral hearings or to participate in the proceedings. Some of
these statutes, for instance in New Zealand, Spain and Hong Kong, in fact enhance
the opacity of the process by imposing express requirements of confidentiality
unless otherwise agreed by the parties. In some jurisdictions, such as the UK
and Singapore, national courts have even held that there is an implied duty of
confidentiality in international arbitration. Finally, many major institutional
arbitration rules as well as the UNCITRAL Arbitration Rules, often used in ad
hoc arbitration proceedings, also provide that arbitral hearings are private
unless otherwise agreed by the parties, and some of these sets of rules expressly
impose either a general duty of confidentiality (absent any contrary agreement)
or limited confidentiality obligations.
In any event, national arbitration laws and institutional sets of arbitration
rules almost uniformly recognize the parties’ freedom, as part of their procedural
autonomy, to agree on the confidentiality of the proceedings, usually subject only
to a limited number of mandatory exceptions. In other words, international
arbitral proceedings may well be initiated, conducted and concluded without
any notice or access to the public, and may lead to a confidential award.
Knowing that the guarantee, in court proceedings, of a public trial is
intended to impose a certain discipline and a sense of accountability on decision
makers—“[p]ublicity [...] keeps the judge himself, while trying, under trial”
(Jeremy Bentham, “The Works of Jeremy Bentham” (Vol 4 1843) at 316)—as
well as to promote the rule of law and due process, hence to heighten the quality
of, and enhance people’s trust in, the justice system, is there not a risk that the
privacy and confidentiality that have been considered key benefits of arbitration
in fact ultimately pose an existential threat to it?
I. LEGITIMACY, TRANSPARENCY AND THE RIGHTS OF THE PARTIES

TO THE DISPUTE
Arbitration is deemed a legitimate means of dispute settlement largely

because it is based on the parties’ mutual consent to opt out of the court system
and to submit their dispute to arbitrators chosen by them or for them.
In light of the importance of having cross-border disputes and disputes
involving states and state entities settled by a neutral adjudicator, states
ENHANCED TRANSPARENCY: THREAT TO ARBITRATION? 393
recognize, even endorse, both in their national arbitration laws and in the New
York Convention, the validity of the parties’ consent to submit their disputes
to an arbitral tribunal. They authorize arbitration proceedings to take place
under basic guarantees of due process as well as of independence and impartiality
of arbitrators, and ensure the efficacy of the resulting award.
Parties that consent to submit a commercial dispute to arbitration are
generally deemed to have waived the right to a public hearing in exchange for
the benefits of private and, if they so wish, confidential proceedings. They waive
their right to a public trial for the benefit of proceedings in which they may
reduce the risk of disclosure of commercially-sensitive information and trade
secrets, in which they might feel at liberty to raise arguments that they would
be reluctant to voice in public proceedings, in which they may be able to shelter
their dispute from inquisitive media and from interested competitors, and in
which they might be both more open to exploring settlement avenues and
more apt at preserving business relations.
In sum, parties that have freely agreed to opt out of the court system and
to submit their dispute to a non-governmental decision-maker, waive their right
to a public trial for the benefit of proceedings in which the focus is placed on a
sober and efficient resolution of the dispute.
Pursuant to state-enacted legislation, these parties ultimately enjoy the
benefits of a decision which is recognized to have virtually the same effects as
an enforceable court judgment, given that the award issued by an arbitral tribunal
is binding, final (subject only to limited grounds for challenge in national courts),
and enforceable in an overwhelming majority of states under the New York
Convention.
II. LEGITIMACY, TRANSPARENCY AND THE RIGHTS OF THIRD PARTIES

INDIRECTLY AFFECTED BY THE PROCEEDINGS
But what about individuals and entities, other than the disputing parties,
that are indirectly affected by arbitral proceedings or by an arbitral award and
have not consented to a decision-making process that does not enjoy the benefits
of being under public scrutiny?
Over the past twenty years, concerns related to the opacity of arbitration
proceedings have been raised primarily in the context of investor-state
arbitration. Scholars and the press alike have cast doubt on the legitimacy and
integrity of investment arbitral tribunals and proceedings and raised a multitude
of arguments in support of enhanced transparency.
The argument has been made, for instance, that where a state (or a state
entity) is a party to a dispute, its constituency has a legitimate interest in observing
the state’s conduct during the proceedings. Furthermore, because investor-
state arbitration affects the public purse of the state that is a party to the dispute
(it is with taxpayers’ money that the state covers the arbitration expenses and
may ultimately have to satisfy an award), it has also been argued that taxpayers
have a legitimate interest in being informed of proceedings that might impact

state finances. Perhaps most importantly, the observation has been made that
many investor-state disputes not only arise in public service sectors (such as, for
instance, water supply, waste disposal and sewage services, telecommunications,
electricity or transport), but plainly raise issues of public policy (such as, for
instance, issues related to public health and safety, the protection of the
environment or market competition), and that arbitral tribunals are, as a result,
regularly called to review investor claims concerning government measures and
policies that are of public interest and may in fact directly impact civil populations.
In light of such concerns, a pro-transparency movement has been under
way for the past two decades. It has led, inter alia, to the adoption of new treaty
provisions, to the adoption of the UNCITRAL Rules on Transparency in Treaty-
Based Investor-State Arbitration, and to the amendment of the ICSID Arbitration
Rules, all of which are intended to enhance the transparency of investment
arbitrations by dealing with questions such as whether hearings should be
open to the public, whether non-disputing parties should be authorized to file
submissions and whether awards should be published.
If, however, the concerns voiced in respect of investor-state arbitration
have been heard, including by states, can one exclude that the same concerns
be regarded as valid also in the context of international commercial arbitration?
Can one today still convincingly maintain that in international commercial
arbitration, it is exclusively the parties that have consented to arbitration and
waived the right to a public trial that might sustain the potentially adverse
consequences of a non-transparent dispute resolution process?
Parties to international commercial arbitrations are not necessarily private
parties asserting private rights. A state or state entity may well be a party to a
commercial arbitration, and commercial arbitration proceedings may even
involve allegations of misconduct or unlawful activities on the part of public
officials (corruption, fraud, money laundering, etc.). Furthermore, one cannot
exclude that the public purse be affected by commercial arbitration proceedings.
If, for instance, a subsidized entity is held liable for damages in an arbitral award,
it might ultimately also be the public that indirectly sustains the consequences
of such an award.
Finally and most importantly, whether the parties to the dispute be a state
body and a commercial entity or two corporations, the outcome of commercial
arbitration proceedings may impact public policies (and state finances), as
such proceedings may directly involve the utilities sector and, even in cases
not involving that sector, they may raise issues of public interest. This is all the
more so as the scope of matters that are said to be inarbitrable—that is, of
matters that may be heard only by domestic courts—has significantly shrunk
over the past two or three decades. For instance, under the Swiss Private
International Law Act, any dispute involving an economic interest may be the
subject matter of an arbitration; some other national arbitration laws provide
ENHANCED TRANSPARENCY: THREAT TO ARBITRATION? 395
that any claim regarding which the parties are entitled to conclude a settlement of
their own is arbitrable.
These observations might justify investigating whether, and to what extent,
considerations that have prompted a pro-transparency movement in investor-
state arbitration might call for some kind of reform in international commercial
arbitration, in order to ensure its continued recognition as a legitimate alternative
to court litigation.
III. LEGITIMACY, TRANSPARENCY AND THE INTEREST OF THE WIDER

PUBLIC
The question might in fact be posed whether, beyond the interests of third
parties that might be affected by arbitration proceedings, it is not also the interest
of the greater public that calls for greater transparency in international arbitration
proceedings.
When parties consent to arbitration, the mission with which they entrust
the arbitrators is to resolve their dispute in an adjudicative manner, according
to the law (unless, of course, the parties have agreed to arbitration in equity).
Whether arbitrators be called to settle issues of jurisdiction, applicable law or
procedure that are specific to arbitration, or they be required to rule on
substantive issues, the parties expect them to state and interpret the law to
determine their rights and obligations —the parties have normative expectations.
Importantly, there is often a creative dimension to the normative activity
that arbitrators conduct. In investment treaty arbitration, for instance, arbitrators
have regularly been called to refine general standards of treatment found in
treaties for the protection of foreign investments such as, for example, the fair
and equitable treatment standard, so as to rule on claims raised by foreign
investors against host states. In sports arbitration, tribunals have also been
required to develop certain principles, such as principles regarding the liability
of competitors for doping offences. Interestingly, these are areas in which
disputes are so regularly referred to arbitration as to effectively hinder the
development of law through domestic courts.
In fact, it is arguable that even when an arbitral tribunal is called to rule on
issues governed by a domestic law, it might eventually state and interpret the
applicable law slightly differently from a domestic court, because the arbitrators,
trained in different jurisdictions, might have different understandings of this
law, and because they might need to adapt it to the international context of the
dispute.
While there is no system of binding precedents in international arbitration,
arbitral awards that are published form de facto a collection of case law from
which subsequent arbitral tribunals have the freedom to take guidance. If
awards, decisions and orders were to be systematically made public, be it in a
redacted form, arbitrators, whose ability and professionalism would be exposed
to the public gaze, would arguably have a greater incentive both to conduct
proceedings efficiently and to ensure the soundness of their decisions. The

latter could in turn offer valuable guidance to future tribunals. By following
persuasive precedents in areas in which the law is rather underdeveloped and,
in particular, in which disputes are commonly referred to arbitration, arbitrators
might help foster a normative environment that is consistent, therefore
predictable. Predictability not only benefits parties that are devising strategies
and arguments in support of their case, but it might also assist individuals and
entities, upstream, to assess their chances of success and avoid certain disputes.
In sum, greater transparency through the publication of awards would
arguably make the arbitration “system” more reliable, hence increase the public’s
confidence in it, and arbitration would accordingly more likely be regarded as
a legitimate substitute for court litigation and, by the same token, more readily
retain support from national legal systems. In other words, increasing the
transparency of arbitration proceedings through the publication of awards
might constitute a “pro-arbitration” endeavor.
IV. CONCLUDING REMARKS
While the legitimacy of arbitration has its source in the parties’ consent
and the latter may freely waive the right to a public trial in exchange for the
benefits of proceedings that are private and possibly also confidential, public
access to court proceedings is a fundamental right aimed primarily at the
protection of public interests. Although some domestic courts have clearly
stated that provisions guaranteeing the public nature of judicial proceedings
do not apply to international arbitration, enhancing the transparency of
arbitration proceedings and of arbitral awards might nonetheless constitute a
pro-arbitration endeavor if greater transparency is geared towards the protection
of public interests.
Importantly, greater transparency does not necessarily mean that
confidential information cannot be protected. While privacy and confidentiality,
on the one hand, and transparency, on the other, might be competing values,
they are not irreconcilable. The level of transparency of arbitration proceedings
and of the outcome thereof should be determined through a cost-benefit
analysis, considering inter alia who the stakeholders are. In particular, exceptions
to the parties’ right to make proceedings and awards confidential should be
carefully defined in light of the protection owed to third parties and of the
interest of the international trade and business community at large. A balance
must be struck between preserving the benefits of features that have, for rational
and legitimate reasons, long attracted parties to arbitration, and ensuring the
fairness and integrity of the justice system.
Chapter 70
GEORGE BERMANN AND THE IMPORTANCE OF
THINKING ABOUT ARBITRATION CONTEXTUALLY
Michael A. Fernández*
As I look back at my tenth-year graduation anniversary from Columbia Law

School and reflect on my law school experience, one of my biggest regrets from
that time is that I was unable to take a course with Professor George A. Bermann.
Generations of Columbia Law students, including many of my closest friends,
have benefited from the many academic initiatives that Professor Bermann has
launched over the course of his long and fruitful career at Columbia. His many
courses have been instrumental in positively shaping the views of many law
students regarding the desirability and efficacy of using international arbitration
as a means of resolving cross-border disputes. Thankfully, Professor Bermann’s
scholarly influence has extended far beyond the Ivory Tower of Columbia Law
School. He is unquestionably one of the preeminent thought leaders in the
global international arbitration community. As a testament to this fact, the
world’s leading arbitration and comparative law practitioners—many of whom
are his former students—banded together to produce this Tribute.
What accounts for Professor Bermann’s towering influence on the
international arbitration field? In my view, it is the work he has done to provide
an intellectual foundation to underpin the international arbitration enterprise.
Professor Bermann’s prolific scholarly contributions in that regard have blazed a
trail that has made international commercial arbitration more acceptable to a
wider audience. His insistence that practitioners should think critically about
what it means to be “pro-arbitration” and his guidance on that question has also
been of critical importance in the struggle to safeguard international commercial
arbitration from those who view it with suspicion.
As Professor Bermann rightly reminds international arbitration practitioners,
arbitration does not exist in a vacuum. Its continued efficacy depends on the
attitudes of users, lawmakers and national courts that give arbitration life.
Without their buy-in, the arbitration enterprise would fall apart. Mindful of
this reality, Professor Berman has provided arbitration practitioners with a
* Michael A. Fernández is an Adjunct Professor of Law at Fordham University School of Law
and a Partner at Rivero Mestre LLP whose practice is focused on complex and cross-border
commercial litigation, international commercial and investor-state arbitration, and corporate
internal investigations. Fluent in Spanish and Portuguese, Mr. Fernández has extensive
experience representing foreign and domestic companies and individuals involved in
arbitrations, litigations, and with investigations in the U.S., as well as parties to international
commercial and investment treaty arbitrations conducted under the major international rules
such as those of the UNCITRAL, ICSID, ICC and ICDR.
397
theoretical framework through which they can analyze whether a given policy
or practice advances arbitration in an article entitled “What Does it Mean to Be
‘Pro-Arbitration’?”
In evaluating the arbitration-friendliness of a particular policy or practice,
Professor Bermann posits a non-exhaustive list of twelve criteria that can be
used to undertake that determination. Many of the criteria he lists require that
consideration be given to the views of actors that are not within the international
arbitration ecosystem, including national courts. In so doing, Professor Bermann
impliedly (and correctly) rejects the idea that there are policies or practices that
are inherently arbitration friendly regardless of context. Professor Bermann’s
approach thus requires that the evaluation of policies and practices be made
in a context-dependent manner. Given the significant variations across legal
regimes, this is very salutary as what is “pro-arbitration” in one jurisdiction
might not be “pro-arbitration” in another jurisdiction.
Because of the open-ended nature of the criteria Professor Bermann
provides, it goes without saying that the assessment of arbitration-friendliness
may vary starkly from one person to another depending on which criteria the
evaluator emphasizes. As Professor Bermann recognizes, this means that a
consensus over whether a value is pro-arbitration is likely beyond reach. This
does not, however, negate the value of using criteria like those that Professor
Bermann advances to evaluate policies or practices related to international
arbitration. The use of a multi-factor evaluative approach does not, as some
are likely to conclude, turn the exercise of evaluating a policy or practice into
an untethered exercise in arbitrariness, provided that the broader set of
relationships between the purposes for which arbitration operates are
weighed against conflicting values external to arbitration.
Considering other factors external to international arbitration in evaluating
whether a policy or practice is favorable or not to international arbitration
does not, as Professor Bermann rightly observes, pose a challenge to the merits
of arbitration as a means of international dispute resolution. On the contrary,
such an approach is, as Professor Bermann suggests, in the best interest of
international arbitration as it ensures that arbitration can coexist with other
important values.
Applying his nuanced approach to the question of what it means to be pro-
arbitration, Professor Bermann has influenced the Restatement of the U.S. Law
of International Commercial and Investor-State Arbitration with an eye
toward creating a constructive relationship between international arbitration
and the national courts that support it. Regardless of what one may think about
where the Restatement might draw the line on any given issue, this is a very
laudable effort. Indeed, the general approach of trying to balance the
important values at the heart of international arbitration with other
considerations should go a long way to ensuring that international arbitration
is better positioned to resist its critics. In that respect, I am confident that the
Restatement of the U.S. Law of International Commercial and Investor-State
THE IMPORTANCE OF THINKING ABOUT ARBITRATION CONTEXTUALLY 399
Arbitration will play an important role in safeguarding the future of

international arbitration in the United States.
In sum, Professor Bermann has had an important intellectual influence on
the international arbitration community. He has molded an entire generation
of arbitration practitioners who have been astute enough to reject policies and
practices that would appear to be pro-arbitration in one sense or another
when they prejudice important values external to arbitration. He has also
extolled those of us who practice international arbitration to think critically about
what values we must safeguard to ensure the continued vitality of our practice.
Every practitioner who practices international arbitration, whether they
know it or not, owes an intellectual debt to Professor Bermann. For an academic,
there is no greater legacy than to shape the terms of the debate in the rather
significant and beneficial way Professor Bermann has done over the course of
his long career. Hopefully, a new generation of students at Columbia Law
School and the intellectual arbitration community will continue to benefit from
his intellectual leadership for many more years to come.
Chapter 71
INTERNATIONAL ARBITRATION AND POLITICAL
LEGITIMACY
Michael Paul Bannon*
Questions about whether a policy is “pro-arbitration” tend to focus on

post-dispute issues. Will the arbitration be speedy and cost efficient? Does it
respect party consent and autonomy? Does it give parties the right to be heard?
Does it expand—or at least maintain—the kinds of claims that may lawfully be
submitted to arbitration?
Professor Bermann’s wise contribution to these questions was about
legitimacy: “a policy or practice may disproportionately favour a pro-arbitration
consideration at the expense not only of other pro-arbitration considerations
but also at the expense of considerations that are largely extrinsic to arbitration,
but nevertheless of considerable social value or utility.” (George Bermann,
What Does it Mean to Be “Pro-Arbitration”?, 34 Arb. Intl. 341, 349 (2018)). “In
fact, acknowledging legitimacy—measured in terms of extrinsic values—as in
itself a pro-arbitration attribute may be among the most arbitration-friendly
moves one can make.” (Id. at 353).
So what is legitimacy? And what makes arbitration legitimate in the first
place? Max Weber defined legitimacy as “the basis of every system of authority,
and correspondingly of every kind of willingness to obey[; it] is a belief, a belief
by virtue of which persons exercising authority are lent prestige.” (The Theory
of Social and Economic Organization 382 (1964)). Under Weber’s classic
taxonomy of political legitimacy—traditional, charismatic, and rational—the
rational sort is best because it is the most reliable. A rationally legitimate
government is one in which society buys into the proposition that law must
exist and that the law must be upheld. A political system can be legitimate if it
submits itself to a reasonable set of rules that are in society’s best interests and
applies them fairly. (Id.)
How does international arbitration win this sort of legitimacy? I submit
that legitimacy goes beyond concerns like arbitral efficiency and award
enforcement. Legitimacy, properly understood, is about the role arbitration
plays in society. Arbitration is only legitimate when it serves the public good.
Arbitration’s role in resolving existing disputes is the most obvious of the
ways it serves the public good. These are the procedural considerations that
* Michael Paul Bannon graduated as a Juris Doctor from Columbia Law School in 2021. As a
student, he took several of Professor Bermann’s classes and worked for him as a teaching
assistant and research assistant.
401
Professor Bermann observes in his seminal paper, and it is the topic of countless
academic papers and webinars in the arbitration world.
A less tangible, but equally real, role arbitration plays is in encouraging
risky business ventures in the first place. A school of political science believes
that dispute resolution is the basis of a prosperous society. In a Hobbesian state
of nature, “the price of peace is poverty.” (Robert Bates, et al., Organizing Violence,
46 J. Conflict Resol’n 599, 610 (2002)). Violence can make societies richer,
according to these theorists, if it is organized by a state and deployed in defense
of property and contract rights and only in defense of those rights (Id.) States need
to be able to protect the fruits of entrepreneurs’ hard work. To do that, they
need independent adjudicators. According to these theorists, it’s no coincidence
that the gentry supported the common law in England even though those judges
answered to the King. Merchants and landowners needed an independent class
of adjudicators, and the judges themselves needed the support of merchants
and landowners to keep a reasonable distance from the Crown. This uneasy
peace, brokered by independent adjudicators, was key to starting the Industrial
Revolution. (Id.; see also Douglass North & Barry Weingast, Constitutions and
Commitment: The Evolution of Institutions Governing Public Choice in Seventeenth
Century England, 49 J. Econ. Hist. 803 (1989)).
Arbitration serves that function today. As court backlogs grow and businesses
prefer greater confidentiality, arbitration can provide an efficient and impartial
way to resolve business disputes. And rather than risk a protracted business
dispute with a foreign business partner litigated in parallel in multiple fora,
international arbitration makes dispute resolution predictable and easy.
Procedural efficiency and speedy enforcement are not ends in themselves;
rather, they are a means to encouraging businesses to take worthwhile risks.
In other words, commercial arbitration inspires economic growth.
These benefits, however, are not inevitable, and several corners of arbitration
today have come under attack for departing for falling short of these values.
And where arbitration is no longer seen as efficient and impartial, it risks
losing its legitimacy.
Mandatory pre-dispute employment arbitration is one such area that has
come under attack. A recent study catalogs average recoveries and success rates
that are significantly lower for employment claimants in arbitration than they are
for plaintiffs in court (Cynthia Estlund, The Black Hole of Mandatory Arbitration,
96 N.C. L.Rev. 679, 688 (2018)). Prof. Estlund estimates that mandatory
employment arbitration is responsible for between 315,000 and 722,000
claims not being filed each year (Id. at 696). “Stated differently, well under two
percent of the employment claims that one would expect to find in some forum,
but that are covered by MAAs, ever enter the arbitration process” (Id.).
For the purposes of this essay, it isn’t the findings themselves that draw
my attention, but what they reflect: the rise of serious questions about the
legitimacy of arbitration—or, at the very least, the relative legitimacy of an
arbitral forum vis-à-vis the judiciary. Any “pro-arbitration” stance must take
INTERNATIONAL ARBITRATION AND POLITICAL LEGITIMACY 403
these questions into account and answer for the role that arbitration plays in
society, and the role it ought to play.
These questions of legitimacy led to the recent passage of the Ending Forced
Arbitration of Sexual Assault and Sexual Harassment Act of 2021, codified at 9
U.S.C. §§ 401, 402. We might defend—indeed, we should defend—this Act by
“acknowledg[ing] legitimacy … as in itself a pro-arbitration attribute,” to use
Professor Bermann’s words. And, more broadly, what the Act shows is that
arbitration must carry on pursuant to a democratic mandate, and in support of
democratic norms.
This leads me to the third role that arbitration plays in the modern world.
It is a geopolitical one. Under the “liberal” theory of international relations, the
key to peace among nations is interconnected trade and finance (see, for instance,
Jack Snyder, One World, Rival Theories, 145 FOREIGN POLICY 52 (2004)).
Multilateral bodies like the World Bank, the International Monetary Fund, and
the United Nations justify their very existence with this theory. The European
Union is perhaps the best proof of this theory: after centuries of constant
fighting, a Franco-German war is now unimaginable.
International arbitration contributes to peace among nations by facilitating
these international business ties and by ensuring an efficient, predictable
resolution when a few of those ties inevitably fray. Caline Mouawad, in her 2021
keynote speech delivered at the Columbia Law School Arbitration Day, made
exactly this point (see also Caline Mouawad, Arbitration in a Changing World,
32 AM. REV. INT’L ARB. (2021)). International arbitration, supported by the New
York Convention, plays a crucial role in resolving business disputes in the
absence of EU-style multilateralism (see Convention on the Recognition and
Enforcement of Foreign Arbitral Awards, June 6, 1958, 21 U.S.T. 2517, 330
U.N.T.S. 38). It’s an unqualified public good.
A corollary to this liberal theory of international relations I discussed above
is the democratic peace theory. Liberal democracies don’t go to war with other
liberal democracies (Michael Doyle, Liberalism and World Politics, 80 AM. POL.
SCI. REV. 1151 (1986)). By administering laws blessed with democratic legitimacy,
international arbitration is contributing to this democratic peace. If we aren’t
careful, however, American arbitration policy may undercut democracy.
Professor Bermann noted that both the majority and dissent in AT&T v.
Concepcion, 563 U.S. 333 (2011), reasoned from a pro-arbitration position (see
Bermann, Id., at 348). No matter what the narrowly “pro-arbitration” outcome
might have actually been, the outcome in Concepcion is in tension with
arbitration’s democratic prerogative. This tension comes not from the law
itself but rather the political ramifications of the law: the limits imposed by
Concepcion may hamstring state legislatures in carrying out their own
democratic mandate.
An aggressive arbitration policy that overrides other democratic mandates
is at odds with international arbitration’s role in sustaining democracy and
world peace. Democracy is fragile. And taking this democratic prerogative into
account must be “among the most arbitration-friendly moves one can make.”
Being pro-arbitration, as Professor Bermann argued, is about legitimacy.
Where narrow pro-arbitration considerations conflict with arbitration’s
legitimacy, legitimacy must take precedence.
Legitimacy, as I understand it, naturally embraces those procedural issues
that occupy so much of the arbitration literature. But legitimacy is also about
the effects of arbitration on society outside the dispute. Where arbitration
encourages businesses to take risks, relying on a speedy and impartial dispute
resolution mechanism in case the worst happens, arbitration is legitimate. But
where arbitration faces serious allegations of stamping out colorable claims, it
risks illegitimacy. And finally, legitimacy is about the effects of arbitration on
politics and democracy. Arbitration is at its best when it facilitates international
trade and finance. It is at its most precarious when it dashes democratic mandates.
The international arbitration community can be “pro-arbitration” and still
acknowledge—and work to reform—the areas where arbitration lacks
legitimacy. Doing so “may be among the most arbitration-friendly moves one
can make.”
Chapter 72
BECOMING “GEORGE”
Michael Granne*
Professor George Bermann. He was Professor Bermann for many years

before, carefully, oh so carefully, he has become George. His knowledge and
passion sparked my interest, a jaded second-year law student focused at the
time on a different career and fed the fascination that followed. Many will write
about his scholarship, his intellectual leadership, his force-of-nature mastery
of the field. I will cautiously share some different thoughts.
Professor Bermann’s course, Transnational Litigation and Arbitration, was
eye-opening: It ended up being one of the courses I recommended most to my
colleagues. But just as important as the course material was exposure to he
who would become George, who would have such an influence on my career.
He was dynamic; arch; smart; ironic; humorous; and he was oh-so-good.
Arbitration, you say? I had no idea such a beast existed. Foreign sovereign
immunity? My exposure there was more in line with Lethal Weapon 2. Most
importantly, he taught me the immutable lesson and truth that sensitivity to
different approaches, to foreign concepts of law and society, were as valid, as
careful, and sometimes better than the Anglo-American approach. I did not
know what prejudices into which I had been indoctrinated, like almost all
American law students. One grows up with a sense that there is a certain way
of doing things, from a civil jury (anathema as most of us know outside the U.S.)
to discovery (perhaps even more so, if that were possible). Being taught the
falsity of that assumption, or better deprogrammed, was a key part of my
education, both legal and personal.
After Professor Bermann’s time as my professor, George has remained my
teacher (as for so many of us) in all things arbitration. When I have had a question,
he is the ever-present resource. When I have needed advice, the same. Having
had the pleasure of working with him later in my career, I can only express my
thanks, again, as I hopefully did after the first course together, for leading the
way for all of us in the arbitration and transnational litigation field.
* Michael Granne is a Founding Partner at Provenzano Granne & Bader LLP, a boutique
international law firm in New York City, and is a Visiting Assistant Professor at Seton Hall Law
School. He is a 2002 graduate of Columbia Law School.
405
Chapter 73
THE STOP-AND-GO RISE OF FRANCE’S
PRO-ARBITRATION REGIME:
A PLAY IN FIVE ACTS
Mikaël Schinazi*
France is often held up as a model for pro-arbitration laws and policies. In

an article entitled “International Commercial Arbitration: The Contribution of
the French Jurisprudence,” published in 1986, Arthur Taylor von Mehren
discussed the French legal regime’s favorableness towards arbitration and the
“pervasive and crucial role” French courts, jurists, and institutions have played
in the consolidation of international commercial arbitration. In an article with
echoes of von Mehren’s, Emmanuel Gaillard referred to a clear “pensée
juridique française” in international arbitration, and elsewhere he described
French Court of Cassation case law on international arbitration as “strong and
coherent,” a powerfully resonating voice in modern arbitration law. Similarly,
Jan Paulsson sang the praises of France’s contribution to international
arbitration in his book The Idea of Arbitration, enthusing that “[n]owhere else
have the twin lodestars of freedom and internationalization, combined in the
conception of a voluntary process that accommodates the reality of a
transnational society, shone so bright.”
How, we may ask, did that pro-arbitration regime come about? Much in the
manner of classical drama, its unfolding can be recounted in five acts, each
corresponding to a period in its history. The time divisions are of course
approximative, and space allows only an abridged account of each period.
Act I covers the period from the 1840s to the 1920s, during which time it
became necessary to affirm the validity of arbitration clauses under French
law. Act II, covering the 1920s and 1930s, tells of how a legal regime
specifically for international commercial arbitration was created. Act III moves
on to the 1940s and 1950s, when discussions surrounding the New York
Convention stimulated thinking on the efficacy of international arbitration in
French legal circles. Act IV, starting in the 1960s, covers the period during which
French legal scholars and courts developed key features of the modern French
international arbitration regime, especially its autonomous character vis-à-vis
state courts. Finally, Act V chronicles the codification in the 1980s and
thereafter of many of the aforementioned advances, especially in bold new
instruments like the 1980–1981 and 2011 French decrees on arbitration.
* Mikaël Schinazi is an Associate in International Arbitration at Gaillard Banifatemi Shelbaya
Disputes and a Visiting Lecturer in Law at Sciences Po Law School in Paris, France.
407
There are two main reasons for choosing to explore French law’s support
of arbitration in a book of tributes to Professor Bermann. The first is directly
related to Professor Bermann’s 2018 article, “What Does it Mean to Be ‘Pro-
Arbitration’?” (from which the editors of the present volume invited contributors
to draw inspiration). In that article, Professor Bermann delivers an insightful
analysis of what it means for any legal regime or policy to be pro-arbitration.
He proposes a (non-exhaustive) list of twelve criteria for measuring the degree
to which any given policy or practice is favorable towards arbitration. In so
doing, he provides an excellent metric for evaluating laws or policies at a given
moment. However, his analysis leaves aside the question of the development
and evolution of pro-arbitration regimes over time. In other words, he adopts
what in Saussurean terms could be called a synchronic approach to the study
of legal regimes (i.e., studying them at a specific point in time). The present
contribution seeks to complement that viewpoint by taking a diachronic
approach—that is, by studying a legal regime from the perspective of its historical
development.
The second reason for writing about arbitration in France is in recognition
of Professor Bermann’s own interest in and links to France as both teacher and
scholar. As a teacher, Professor Bermann is indeed highly esteemed for having
mentored countless French students, whether at Columbia Law School, the
Institut d’Études Politiques (Sciences Po) in Paris, where he is an affiliated
faculty member, or the University of Paris I (Panthéon-Sorbonne), where he held
the Tocqueville-Fulbright Distinguished Professorship. A particularly eloquent
expression of this esteem was the honorary degree he received from the
University of Versailles-St. Quentin in 2011. As a scholar, Professor Bermann’s
connections with France are numerous. In 2008 he co-edited an important
volume entitled Introduction to French Law; he is a member of the editorial
board of France’s hallowed journal of arbitration scholarship, the Revue de
l’arbitrage; in 2011 he delivered a brilliant overview of his research on “gateway
issues” in international arbitration to the Comité français de droit international
privé; and his 2015 course at the Hague Academy of International Law, entitled
Arbitration and Private International Law, is peppered with references to
French case law and arbitration scholarship. The present contribution therefore
pays tribute to a great international and comparative law scholar and teacher,
who has long been a keen observer, and at times participant in, French legal
life and learning.
I. ACT I: AFFIRMING THE VALIDITY OF ARBITRATION CLAUSES

(1840s–1920s)
Although the French legal regime is today undoubtedly pro-arbitration, this

was not always the case. There was a time—roughly between the 1840s and
the 1920s—when France witnessed a strong current of judicial and legislative
hostility towards arbitration. Such hostility manifested itself in arguments over
THE STOP-AND-GO RISE OF FRANCE’S PRO-ARBITRATION REGIME 409
the validity of arbitration clauses and culminated in the Compagnie L’Alliance

v. Prunier decision of 1843.
In that case, Prunier had a fire insurance policy with the company L’Alliance.
The insurance contract stated that all disputes between the insurance company
and the policyholder concerning damages resulting from fire would be resolved
by a panel of three arbitrators sitting at the company’s headquarters in Paris.
Following a fire which destroyed Prunier’s buildings, L’Alliance refused to pay
the sum owed under the insurance contract. Prunier sued the insurance
company, and the case went all the way to France’s supreme court for civil and
criminal matters, the Court of Cassation, which ruled in favor of Prunier and
declared the arbitration clause in the insurance contract void. According to the
Court, an arbitration agreement had to specify the subject matter of the dispute
and the identity of the arbitrators in order to be valid.
The upshot of this decision was to render typical arbitration clauses
unenforceable, because the subject matter of a future dispute and the names
of the arbitrators who would adjudicate it could hardly be specified in advance.
The Court of Cassation confirmed its stance in two further decisions rendered
in 1844, and it was not long before arbitration clauses in commercial contracts
were also held to be invalid. Prunier and similar decisions not only revealed
deep-seated concerns about arbitration in France but also set apart the French
arbitration regime as much less favorable than that of its European neighbors.
Heated legal (and even political) debate ensued and the law on arbitration
clauses was finally reformed in 1925 with the promulgation of a law putting an
end to the Prunier jurisprudence as far as commercial contracts were concerned.
Interestingly, the narrative is surprisingly similar in the United States.
There, too, the nineteenth century was marked by strong judicial and legislative
hostility towards commercial arbitration, reflected in Joseph Story’s remark,
in his 1884 Commentaries on Equity Jurisprudence, that “courts of justice are
presumed to be better capable of administering and enforcing the real rights
of the parties, than any mere private arbitrators.” As Professor Bermann
pointed out in “What Does it Mean to Be ‘Pro-Arbitration’?” a complete reversal
of attitudes took place in 1925 with the passing of the Federal Arbitration Act
establishing an extremely pro-arbitration regime. This, it will be recalled, was
the year in which the French bill affirming the validity of arbitration clauses
also became law, paving the way for more positive developments in the French
international arbitration regime.
II. ACT II: DEFINING INTERNATIONALITY (1920s–1930s)
Running in parallel to the debate over the validity of arbitration clauses

was a broader discussion on the distinction between domestic and international
arbitration. This and the cases that followed Prunier led courts, scholars, and
lawmakers to ponder the treatment to be given to contracts involving foreign
elements. As von Mehren observed, this is how “a separate and distinct legal
regime for international arbitration began to emerge in French law,” culminating

in such cases as Pélissier du Besset (1927) and Mardelé (1930), to which many of
the distinctively pro-arbitration features of the French legal regime owe their
origin.
Pélissier du Besset concerned a sixty-one-year lease on shops in Algeria
agreed between a French national, Pélissier du Besset, and an English company,
The Algiers Land and Warehouse Co. Ltd. In 1883, when the contract was made,
Algeria was under French rule. According to the contract, the rent was to be paid
in pounds sterling. In 1923, faced with the depreciation of the French franc against
the British pound, Pélissier du Besset’s heirs initiated a legal action to have the
gold clause in the contract declared void under French law. The English company,
however, refuted this claim on the grounds that the parties’ differing nationalities
made the lease agreement an international contract, which meant that the gold
clause was valid. The court had to decide whether the operation “could be
characterized as an overseas or international operation.”
Advocate General Matter addressed the question by adopting an economic
rather than a legal definition of an international transaction. He famously
expressed the view that “[t]o be thus characterized, the contract must have
reciprocal effects, as a sort of ebb-and-flow movement across borders, in the
two countries.” According to Matter, “the renting of a real property right in
Algiers by an Englishman to a Frenchman has not resulted in France in the
entry of goods or money, the operation was entirely local, so payment therefor
must necessarily be subject to French public policy laws.” The case ultimately
came before the Court of Cassation, which had to decide whether, as contended
by the respondent, the lease agreement should be qualified as an overseas
transaction.
The question came to be revisited in a number of later cases. In Mardelé
(1930), for example, the Court of Cassation applied a criterion of a different nature
from the economic concept of “ebb-and-flow movement across borders” asserted
in Pélissier du Besset, relying instead on the notion of “interests of international
commerce.” This was a broader concept, which made it possible to develop an
arbitration regime specifically tailored to the requirements of international
commerce. It is largely through these cases that French law truly began to
fashion a special regime for international commercial arbitration.
III. ACT III: DESIGNING AND APPLYING THE NEW YORK CONVENTION
(1940s–1950s)
In the 1920s, two international instruments—the 1923 Geneva Protocol

on Arbitration Clauses and the 1927 Geneva Convention on the Execution of
Foreign Awards—were developed to deal with, respectively, the international
validity of arbitration clauses and the international recognition and enforcement
of arbitration awards. Even though the Geneva Protocol and Geneva Convention
were important steps forward, it soon became clear that the needs of international
commerce could no longer be adequately met by these two instruments and

that a new international convention was needed.
Between June 13 and 15, 1946, an international conference was convened
at the Paris headquarters of the International Chamber of Commerce (ICC).
This neglected conference, the records of which can be found in the Columbia
University Libraries, brought together representatives of major arbitral bodies.
Delegates highlighted the need for “a simplified international procedure of
recognition and execution of foreign arbitral awards.”
Discussions on that issue continued, and in March 1953 the ICC adopted a
“Preliminary Draft Convention” on the enforcement of international arbitral
awards. Several French arbitration scholars, including Jean Robert, René
Arnaud, and Charles Carabiber, were involved in drafting this novel instrument,
which contained some particularly significant features. It notably did not require
an award to have become final in the country where it was made in order for
it to be enforced elsewhere, simply stating instead that the award should not
have been annulled in its country of origin; it thus dispensed with the double
exequatur requirement that had existed under the Geneva Convention. It also
contained limited references to national law, giving greater importance to the
will of the parties. The ICC Draft Convention was submitted to UN member
states and various organizations for comments and many of its features found
their way into the final text of the 1958 Convention on the Recognition and
Enforcement of Foreign Arbitral Awards (the “New York Convention”).
The discussions aroused by the New York Convention stimulated thinking
on the efficacy of the international arbitration regime, and not just in France.
The conditions laid down in Article VII of the New York Convention established
what Professors Bermann and Gaillard, in the UNCITRAL Secretariat Guide on
the New York Convention, described as a “‘ceiling,’ or maximum level of control,
which Contracting States may exert over arbitral awards and arbitration
agreements.” In other words, the New York Convention set only a minimum
standard, leaving states free to apply more liberal rules if they wished.
As the years went by, French scholarship and case law vigorously promoted
both the letter and the spirit of the New York Convention. In so doing, they ensured
that domestic legal obstacles restraining recourse to arbitration by private
parties would be raised only in very limited circumstances. Through these
initiatives, French courts helped to build France’s reputation in this area and
to mark out the French legal regime as so strongly pro-arbitration.
IV. ACT IV: GIVING ARBITRATION AN AUTONOMOUS CHARACTER

(1960s–PRESENT)
In the 1960s and thereafter, a group of mostly French scholars, including

figures like Berthold Goldman, envisioned international arbitration as an
autonomous system. Through such notions as lex mercatoria, they sought to
describe international arbitration as detached from national laws, governed by
its own rules, and forming a true international legal order. Their work helped
to shape modern French arbitration law and give it some of its pro-arbitration
features.
These scholars had a profound influence—and their writings were, in turn,
deeply influenced by—a series of famous cases, including the seminal Gosset
judgment of 1963 (Établissements Raymond Gosset v. Société Frère Carapelli S.p.A).
In that case, the French Court of Cassation established the principle of the
autonomy of the arbitration agreement, now enshrined in Article 1447 of the
French Code of Civil Procedure (FCCP). According to this principle, the arbitration
agreement is deemed to be independent of the contract of which it is part. This
means that the validity of the arbitration clause remains unaffected by any
claims that the main contract is void and the arbitral tribunal’s jurisdiction to
rule on such claims likewise remains intact. By allowing the arbitration clause
to survive the demise of the contract in which it is contained, this principle
(also known as the principle of separability or severability) is central to
enhancing arbitration’s efficacy.
In another influential—and much debated—line of cases, French courts
were asked to consider the fate of international arbitral awards that had been
set aside in a foreign state. A leading example is the 1984 Norsolor judgment
(Norsolor S.A. v. Pabalk Ticaret Limited Sirketi), in which the Court of Cassation
recognized the possibility for French courts to allow the enforcement of
annulled awards. The Court of Cassation overturned the prior decision of the
Paris Court of Appeal, which, on the basis of Article V(1)(e) of the New York
Convention, had refused to enforce an award rendered in Austria and
subsequently annulled by the Vienna Court of Appeal. The Court of Cassation
held that the French court should have determined whether enforcement of
the award would be prohibited under French law. The reason given by the
Vienna Court of Appeal to justify setting aside the award—that, instead of
determining which national law was applicable, the arbitral tribunal had directly
applied lex mercatoria—did not justify refusing enforcement under French law.
The French Court of Cassation took another important step forward in its
later Hilmarton decision in 1994 (Société Hilmarton Ltd. v. Société Omnium de
traitement et de valorisation), which confirmed Norsolor by clearly stating that
an award set aside in the country of the seat may be recognized in France.
Hilmarton was followed by another key case, Chromalloy (1997). Reiterating the
French position on the recognition and enforcement of awards set aside in the
country of the seat, the Paris Court of Appeal stated that “the award rendered
in Egypt was an international award which by definition was not integrated
into the legal order of that country such that its existence continues despite its
nullification and … its recognition in France is not contrary to international
public policy.”
As might be expected, the Norsolor, Hilmarton, Chromalloy line of cases led
to intense discussion in legal and academic circles. Over the years, the French
approach was followed in several other cases, including, in 2007, the renowned
judgment in Putrabali (Société PT Putrabali Adyamulia v. Société Rena Holding

et Société Moguntia Est Épices). Whatever one thinks of the decisions reached
in these cases, by positing that an international award rendered in a foreign state
could be enforced in France despite having been annulled elsewhere, they helped
strengthen France’s international arbitration system and give it such a strongly
pro-arbitration hue.
V. ACT V: CONSOLIDATING AND AFFIRMING KEY PRO-ARBITRATION

PRINCIPLES
In recent decades, many of the ideas and principles described above have
been codified. These codification efforts form the culminating fifth act of our
play. For instance, the distinction between domestic and international arbitration
was enshrined in the Decree of 12 May 1981 and maintained in the Decree of
13 January 2011 (the “2011 reform”), making it possible to apply more liberal
principles to international arbitration, which was thus freed of unnecessary
restrictions.
The 2011 reform was especially important in securing France’s position as
a leading pro-arbitration country. It confirmed several key ideas and principles
that had been developed by French courts over the previous three decades. Of
particular note are (i) that international arbitration clauses are not subject to
any requirement as to their form (Article 1507 FCCP); (ii) that parties are
entitled to waive the possibility of annulment proceedings, giving up their
right to challenge the validity of an arbitral award before French courts (Article
1522 FCCP); and (iii) that a challenge against the award does not automatically
cause enforcement proceedings to be suspended, with the caveat that a court
may suspend or modify the enforcement of an award, pending annulment or
enforcement proceedings, if enforcement would seriously prejudice one of the
parties (Article 1526 FCCP). This latter provision was meant to dissuade
parties from frivolously initiating set-aside proceedings, because enforcement
measures will continue to run their course notwithstanding such proceedings.
In addition, the 2011 reform contained provisions relating to the powers of the
juge d’appui—literally, supporting judge or judge in support of the arbitration—
who may be called upon to aid the arbitral process and ensure its effectiveness
in specific situations of need.
It is comforting, not only for France but for international arbitration in
general, that our play has reached a positive denouement. As the plot has
revealed, this denouement is the result of a long process, punctuated by stops
and starts, resistance and advancements. If there is a lesson to be learned, it is
that being pro-arbitration is a quality acquired over time through conviction,
commitment and persistent effort.
Chapter 74
PRO (DOMESTIC) ARBITRATION BUT ANTI
(INTERNATIONAL) ARBITRATION?
COMPLEXITIES IN A DUALIST MODEL
JURISDICTION
Milton Gutcovsky Kujawski*
It is not an easy task to identify whether something is favorable to arbitration;

dealing with a dualist model jurisdiction certainly adds an additional problem
to the issue.
Indeed, there is clearly more than one angle to approach in a proper manner
what it means to be in favor of arbitration. The issue is even more complex if
one considers not only the angle (a specific subject or target, whether a piece
of legislation, a policy, an award, etc.) but also the point of view from which
such analysis is to be conducted (from a practitioner point of view, from an
arbitrator point of view, from a public policy perspective, and so on). The
problem has an additional layer of complexity in those jurisdictions that adopted
a dualist model regarding international arbitration, as in Chile. In this note, I
would like to address how easy it is to defend arbitration on grounds that, on
its face, appear to be in protection of arbitration (or pro-arbitration), but after
some scrutiny, they eventually turn to undermine it (or, at least, to create
doubts as to whether they really are pro-arbitration).
All of the above, explaining, first, the Chilean legal framework regarding
arbitration as necessary context to understand the issue; then, presenting and
analyzing a recent Supreme Court decision as an example of a usual problem
(i.e., the easiness in trying to protect arbitration, on grounds that could easily
disserve it). Lastly, I refer to the importance of taking one step back before making
any conclusion and studying any specific issue from a broad and thoughtful
perspective, more than as if it were an isolated case; this seems to be the fair
path in order to grasp the real conflict at hand, to understand the trade-offs at
stake, as well as to provide a harmonious solution that addresses the issue.
I. LEGAL FRAMEWORK IN CHILE
As to international commercial arbitration, Chile has followed a dualist model,

which means that domestic and international arbitration are regulated under
separate and different legal bodies. On one side, we have two Codes that regulate
domestic arbitration (one deals with Court’s organization, and the other one
* Milton Gutcovsky Kujawski is a LL.M Columbia Law School Graduate, Class of 2018.
415
with Civil Procedure). On the other, we have the International Commercial

Arbitration Act (or “LACI” for its Spanish acronym) which is highly influenced
by the 1985 UNCITRAL Model Law on International Commercial Arbitration.
This dualism has several consequences, but one of special relevance for this
note is related to judicial remedies. It is well known that annulment is the only
judicial remedy available against an award issued in an international commercial
arbitration case. However, under Chilean Law, there are different remedies
available against an award issued in a domestic arbitration, almost all of which
may be waived by the parties (except for the complaint remedy and the cassation
or certiorari).
Framed like this, it is not difficult to imagine the challenges and controversies
that this model may entail when comparing both domestic and international
arbitration. Furthermore, imagine a case (more specifically, an international
commercial arbitration case), in which the parties agreed on Procedural Order
N°1 that both appeal and cassation would be admissible against the Tribunal
award. The latter, while possible under domestic arbitration, is expressly
against the Chilean International Commercial Arbitration Act, as explained above.
A recent Supreme Court decision had to address this issue, and the reasoning
has caught the attention of the arbitration community.
II. THE SUPREME COURT DECISION
During 2015, a share purchase agreement was entered into between a

Chilean holding (the “Seller”) and two Chilean subsidiaries of a Mexican holding
(the “Buyer”) for the acquisition of a major pharmaceutical business (the
“Contract”); the Buyer designated its address in Mexico, satisfying the LACI
requirement for an international commercial arbitration under Chilean law.
Under the Contract, the parties agreed to apply Chilean law, and they also
submitted all controversies to an arbitration, taking place at the Santiago
Arbitration and Mediation Center (CAM Santiago), seated in Santiago, Chile,
under the International Arbitration Rules of CAM Santiago. Regarding judicial
remedies, on Procedural Order N° 1, and following a specific Contract provision,
the parties agreed that both an appeal and a cassation would be admissible
against the tribunal award. The parties also agreed on applying both the Court’s
Organization Code and the Civil Procedural Code in an ancillary manner. This
happened, for one side, due to the difference in remedies between domestic
and international arbitration; for the other, as the parties did not clearly
address whether the case was an international arbitration or not (as per the
LACI, certain requirements must be met, and indeed, were met).
Thus, the Tribunal issued its award, and the Claimant (the Buyer) filed an
appeal to be heard by the Santiago’s Court of Appeals. The Seller, in one hand,
argued that this remedy was not applicable to an international arbitration case,
being annulment the only admissible remedy under the LACI; the Buyer, on the
other, argued that this was a purely domestic arbitration and the parties agreed
COMPLEXITIES IN A DUALIST MODEL JURISDICTION 417
that such remedy was admissible. After receiving and reviewing the appeal, the
Appellate Court declared it inadmissible. This, based on a public policy
consideration, i.e., being an international commercial arbitration, the Court
must apply the LACI, which only allows for annulment of an award and no
reference to other judicial remedies is mentioned under that piece of
legislation; in other words, no appeal is admissible in an international commercial
arbitration case. The Court of appeals not only declared inadmissible, but also
rejected a subsequent intent by the Buyer to overrule its decision.
Due to the Court of Appeal decision, the Buyer filed under the Chilean
Supreme Court a complaint appeal (a judicial remedy which must be grounded
on an abuse of law when “issuing” a decision). This remedy, when filed, requires
the Court that issued the decision to give its reasoning to sustain (before the
Supreme Court in this case) why its decision did not commit the alleged abuse
of law. Consequently, the Court of appeal argued that, although parties’ consent
is cornerstone to arbitration (as a manifestation of party intent), it nevertheless
has a limit, being that limit a potential contravention of the Chilean International
Commercial Arbitration Act itself. To put it differently, the Appellate Court
decided that party autonomy could not contravene Chilean legislation. In this
fashion, the Appellate body concluded that it had not committed an abuse of
law, but only an interpretation of the LACI.
To the extent that such argument is applicable for both, domestic and
international arbitration, it seems a reasonable and logical justification. Yet, as
the decision did not address the specific facts of the case, it left the door open
for the Supreme Court to reverse the decision. Indeed, while partially agreeing
with the reasoning, the Supreme Court grounded its decision to invalidate,
precisely, on the facts of the case. Moreover, the Supreme Court rejected the
complaint appeal, but using its extraordinary powers, annulled the Court of
Appeal decision and declared admissible the appeal, nonetheless. The
Supreme Court’s reasoning was based on party autonomy and good faith but
taking into consideration—specifically—the facts of the case.
First, it supported the idea that arbitration is based on the Contract’s
agreement to arbitrate, thus, the parties’ intent must be enforced. Then, it
established that, after reviewing the Procedural Order N°1, it was clear the
parties agreed on the admissibility of both an appeal and a cassation, even so
if such agreement could contravene the LACI; thus, none of the parties could
later take advantage of its previous acts (when agreeing regarding judicial
remedies). Such an act, stated the Court, would be against the procedural good
faith. In conclusion, the Supreme Court, without a depth reasoning, invalidated
the decision, and declared admissible an appeal, in an international commercial
arbitration.
III. A SIMPLE DECISION, A NOT THAT SIMPLE ISSUE
The Supreme Court decision clearly exemplifies how, even if an argument

is thought to be meant as fostering arbitration—especially international
arbitration—it can be nonetheless (at the same time and even in a stronger
manner) undermining it. Thus, it is important to understand the Court’s
reasoning because it will obviously provide a valuable contribution to future
cases, or at least, to promote discussion among the arbitration community.
Considering the above, there are two alternatives to understand or analyze the
Supreme Court’s decision, none of these, unfortunately, provide a real solution
to the issue at stake. Moreover, both undermine international commercial
arbitration against domestic arbitration.
The first option is to assume that, whether intentionally or not, when
addressing the issue, the Supreme Court decided the case as if it was a
domestic arbitration. Furthermore, it decided the case with an inclination (at
least to some extent) to favor domestic arbitration over international arbitration,
or to give international arbitration a domestic arbitration treatment. The
reason behind this reasoning may be grounded or influenced by the Chilean’s
dualist model. Indeed, there is no doubt that the problem this case posed does
not exist in domestic arbitration, as judicial remedies do not usually generate
conflicts (some are waivable, while some specific ones are not). Also, there is
no doubt that party autonomy is paramount to arbitration (either domestic or
international).
However, from the wording of the decision, based on the grounds of party
autonomy and good faith, it left some space to imply that it is treating an
international arbitration case as if it was a purely domestic case. This is so
because there is little reference (let alone discussion) by the Court as to
international arbitration principles, and how domestic and international
arbitration interplay—whether generally, or specifically in this case.
Eventually, this argument may very well be pro-domestic arbitration (as it
strongly defends party intent) but at the same time anti-international arbitration
(as it clearly contradicts the LACI). It is possible that the Court considered this
case as a domestic arbitration, as that may be an easy solution for the case at
hand, yet there is no reference to that matter.
The second option implies that, when deciding the issue, the Supreme Court
simply overlooked one commonly used and general principle of international
arbitration; even more, a principle that is expressly recognized under the LACI,
the annulment as the sole remedy. Indeed, article 34 of LACI recognizes and
assures that international arbitration awards can only be challenged by
annulment. This path, as said, implies that for the purposes of solving this case,
the Supreme Court neglected the importance of annulment and how this
remedy is at the heart of international arbitration. Otherwise, there is no
explanation to admit an appeal and a cassation in an international commercial
arbitration case, even when this is not recognized under the LACI.
COMPLEXITIES IN A DUALIST MODEL JURISDICTION 419
In any case, to the extent that consent is paramount to arbitration, it is fair

to state that when defending the importance of party autonomy, the Court was,
at least theoretically, promoting arbitration. Yet that is clearly a trap. Indeed,
when opposing intent to a basic principle of international arbitration, more
than promoting arbitration, it is in fact acting in its detriment. First, because it
submits international and domestic arbitration to a different treatment there
was not necessarily the only option to solve the issue. Second, when opposes
(at least indirectly) party intent with a specific policy or law, in this case, the
LACI (without a reasoning behind). Third, as it did not address whether the
decision is made under the assumption that parties may consent to disregard
article 34 of the LACI (at least analyzing the wording of the LACI, it seems
difficult to accept such an idea, nonetheless). While it is true that this is a highly
fact-specific decision, it may set a delicate interpretation. Thus, the importance of
understanding the principles at stake and the trade-offs at hand before issuing
a decision need never be taken for granted.
On a closing note, and to prevent future complexities for now, it will be
important for practitioners connected with Chile to determine precisely whether
the case at hand is a domestic arbitration or an international arbitration, not
only under the Contract, but also on Procedural Order N°1.
Chapter 75
PRO-ARBITRATION CONCEPT: REFLECTIONS ON
FRENCH ARBITRATION LAW
Morgan Imbert*
I. INTRODUCTION
The concept of “pro-arbitration” (or “arbitration-friendliness”) refers to the

tendency of a policy or a practice to promote such things as party autonomy, a
certain procedural flexibility, cultural neutrality, enforceability of agreements
to arbitrate and arbitral awards as well as parties’ legitimate contractual
expectations.
In his reflections on what it means to be pro-arbitration, Prof. George
Bermann has shed light on two constraints that prove integral to the expansion
of international commercial arbitration. First, a pro-arbitration strategy
necessarily entails managing trade-offs among pro-arbitration considerations.
A policy or a practice that achieves some of international arbitration’s purposes
may well disserve others. For this reason, compromising between pro-
arbitration values is almost inevitable. This is what Prof. Bermann calls the “pro-
arbitration trade-offs.” An example of competing pro-arbitration
considerations may be found in the availability of interim relief from national
courts in conjunction with arbitration. The intervention of domestic courts may
be seen both as contributing to the effectiveness of the arbitration proceedings
and as undesirably interfering with party autonomy. Another illustration lies
in the constant challenge for arbitrators to reconcile efficiency with their
obligation to avoid annulment of the subsequent award on due process grounds.
Secondly, an arbitration-friendly regime needs to foster arbitration’s
legitimacy by safeguarding values that are admittedly extrinsic to arbitration
yet fundamental to some legal systems. Measures that preserve the core values
of a legal order at the expense of some of arbitration’s basic goals may be
regarded as pro-arbitration insofar as they contribute to enhance arbitration’s
legitimacy. A leading example is the need to temper the parties’ freedom to
determine the arbitral procedure in order to guarantee due process, a value of
central importance across legal traditions.
This essay proposes to sketch the historical, theoretical and political reasons
why the implications of the pro-arbitration concept have found significant
* Morgan Imbert is an Associate in the White & Case LLP International Arbitration Group,
Paris. The author expresses her sincere thanks to Christopher Seppälä for the stimulating
discussion and encouragement, as well as to Christophe von Krause and Elizabeth Oger-Cross
for reading the manuscript.
421
resonance in France. It further illustrates the two constraints that are central
to the development of an arbitration-friendly regime, as alluded to earlier. In
so doing, this piece addresses the pro-arbitration trade-offs that have led to a
remarkable feature of French arbitration law, that is, the “substantive-rule
method.” It then discusses the recent shift in the French approach towards
more detailed judicial scrutiny of arbitral awards on matters of public policy,
in particular on issues of corruption, fraud and money laundering. This new
development has shown that France is willing to curb the effectiveness of
(some) arbitral awards, a key pro-arbitration consideration, for the sake of
major societal values and arbitration’s long-term legitimacy.
The present contribution is a tribute to Prof. Bermann’s ever-renewed
interest in France and its laws, both as an expert in international arbitration
and as a Francophile in general.
II. RESONANCE OF THE PRO-ARBITRATION CONCEPT IN FRANCE
French courts have done much to produce a pro-arbitration legal framework

for international commercial arbitration. The varying degree of judicial tolerance
towards arbitration may find its explanation in a different approach to the
monopoly of state justice across legal traditions. In France, lawmaking is the
sole prerogative of the elected legislature. Since the French Revolution, the
judiciary adjudicates legal disputes in the name of the state and applies the law
in an apolitical fashion. Under this approach, and as French political philosopher
Montesquieu once wrote, judges must be “no more than the mouth that
pronounces the words of the law.” Perhaps because of the more limited powers
of the judiciary in civil law countries, international arbitration is not seen as a
threat to the courts’ power and authority. On the contrary, the French
judiciary, academic community and legal profession have worked hand in hand
to foster one of the most liberal international arbitration regimes in the world.
This arbitration-friendliness stands in contrast to the limited tolerance that
the judiciary of some common law jurisdictions may, at least once, have shown
towards arbitration.
Philosophically, the autonomous representation of international arbitration
has paved the way for a strongly pro-arbitration regime in France. Developed
by French scholars such as Berthold Goldman, Philippe Fouchard or Pierre Mayer,
the theory of “autonomy” is that which accepts the idea that “the arbitrator has
no forum”. Put differently, international arbitrators do not dispense justice on
behalf of any given state and, more generally, do not belong to any legal system,
be it national, international or transnational. The influence of the theory of
autonomy or “delocalization” of arbitration on French case law and legislation
is well known. The decision of the Court of Cassation in Putrabali v. Rena Holding
is representative, ruling that an international award by definition “is not anchored
in any national legal order.” This premise has enabled French courts to
consistently recognize foreign awards that have been annulled at their arbitral
PRO-ARBITRATION CONCEPT: REFLECTIONS ON FRENCH ARBITRATION LAW 423
seat. By a decree promulgated on 12 May 1981, French law was also the first
to codify that international arbitrators may directly apply “rules of law,”
including non-national legal systems, in the absence of any agreement by the
parties as to the law governing their dispute. In so doing, the arbitral tribunal
is relieved from having to perform conflict-of-law analysis and is not bound to
select the substantive rules of any given legal order.
Proponents of the theory of autonomy are aware of the practical limits of
the delocalization of arbitration. Indeed, international arbitration does not and
cannot operate within a legal vacuum. Although the will of the parties gives life
to the arbitral process, it can only make international arbitration agreements and
awards effective to the extent that domestic laws and courts grant such powers
on the arbitrators. The efficacy of international arbitration rests on the support
that the national legislature and judiciary, especially of the arbitral seat, give
to this form of dispute resolution. The liberal aspirations of international
arbitration will inevitably find their limits in the fundamental values of the
systems of law with which arbitration must conform to secure legitimacy and
effectiveness.
From a political perspective, France is a member of the European Union (EU)
and, as such, has to reconcile itself with the European institutions’ growing
mistrust of international arbitration. This scepticism is not limited to the field
of investment arbitration, in which the Achmea case and its progeny have
resoundingly condemned the jurisdiction of investor-State tribunals in intra-
EU disputes. Relatedly, recent decisions of the European Court of Justice (ECJ)
and French courts have emphasised the incompatibility of private commercial
arbitration with some fundamental tenets of European law. In 2016, Advocate-
General Wathelet in his Opinion in the Genentech case suggested that French
courts’ limited review of arbitral awards for violation of EU public policy and
the impossibility to entertain such a challenge when the violation had already
been argued during the arbitration phase were at odds with the principle of
effectiveness of EU law. The principle of effectiveness is that which requires
Member States to lay down procedural rules that do not make it impossible or
excessively difficult to exercise rights that individuals derive from EU law. The
Advocate-General of the ECJ went on to urge French courts to undertake de
novo judicial review of arbitrators’ EU public policy decisions. This assessment
rested on the notion that only the Member States’ domestic courts could
guarantee the full effectiveness of EU public policy as arbitral tribunals are
denied the status of Member States’ courts within the meaning of the preliminary
reference mechanism. The preliminary reference mechanism allows Member
States’ courts to submit preliminary references to the ECJ to obtain a ruling on
the interpretation or validity of an EU legal act. Yet the ECJ has repeatedly
refused to grant international arbitral tribunals standing to make preliminary
references, thereby depriving them of the status of Member States’ courts
under Section 267 of the Treaty on the Functioning of the European Union.
The PWC Landwell case provides another illustration of the constraints

that the European principle of effectiveness places on French arbitration law.
In this 2020 decision, the Court of Cassation formally accepted to limit the
negative effect of the competence-competence principle in order to preserve
the effectiveness of EU consumer law. The so-called “negative aspect” of the
competence-competence principle is certainly one of the most arbitration-
friendly rules of French arbitration law. This approach, which is mandatory in
nature under French law, consists in dismissing judicial proceedings when claims
brought before the courts are allegedly subject to an arbitration agreement.
French courts may retain jurisdiction only where a dispute has not yet been
brought to an arbitral tribunal and the arbitration agreement is “manifestly
void or manifestly not applicable”. As the PWC and Genentech cases make clear,
the search for compromise between pro-arbitration values and fundamental
principles of EU law has become a necessity in all Member States and in France
in particular.
III. PRO-ARBITRATION TRADE-OFFS IN THE FRENCH SUBSTANTIVE-

RULE METHOD
Beyond the European constraints described above, the French substantive-

rule method (méthode des règles matérielles) is a prime example showing that a
pro-arbitration strategy may generate tensions between arbitration-friendly
values.
A few decades ago, studies of French case law by Prof. Arthur Taylor von
Mehren presciently discerned the potential of the substantive-rule method to
replace traditional choice-of-law reasoning in the field of international arbitration.
Under this approach, French reviewing courts have uniformly applied
“substantive rules of international arbitration” to the validity, existence and
scope of international arbitration agreements. Instead of relying on conflict-
of-law analysis, French law provides that arbitration agreements are subject
to substantive rules that are distinct from those governing the underlying
contract and from any national legislation.
The starting point for this rationale is the separability of the arbitration
clause. As the Court of Cassation first ruled in the 1968 Gosset decision, an
international arbitration agreement has, save in exceptional circumstances, “a
complete juridical autonomy”. The presumed autonomy of the arbitration
clause from the contract within which it is found has enabled French courts to
develop a specialized legal regime for international arbitration agreements. In
2020, Kout Food v. Kabab-Ji was the occasion on which the Paris Court of Appeal
was able to reaffirm what Prof. Emmanuel Gaillard considered to be “the most
fundamental” substantive rule of French arbitration law. The French reviewing
court held that “the parties’ common intention” was sufficient to ground the
existence and effectiveness of an arbitration agreement independently from
national laws. The Kout Food decision went on to rule that the validity of
international arbitration agreements was solely subject to limitations of the

mandatory rules of French law and international public policy. This analysis,
which was first expressed by the Court of Cassation in the seminal case Dalico,
is often referred to as the “principle of validity” of international arbitration
agreements.
Proponents of the substantive-rule method emphasize that substantive
rules allow significant economy in time and costs by sparing the parties complex
discussions on conflict-of-law analysis. More importantly, this substantive
regime was designed to circumvent national laws regarding contract formation
or substantive validity (e.g., mistake, lack of power, illegality, duress) so as to
ensure the more effective enforceability of arbitration agreements. By
contributing to the effectiveness of arbitration agreements as well as speed
and economy in the arbitral process, the substantive-rule method and the
principle of validity promote two ideals of international arbitration that, taken
in isolation, make this approach decisively pro-arbitration.
Yet this policy may not, on the whole, be as arbitration-friendly as initially
thought. Critics have charged that the substantive-rule method and the principle
of validity may disserve values that are equally essential to arbitration, such as
certainty, predictability and, more fundamentally, consent to the arbitral process.
Under the principle of validity, the existence of consent to international
arbitration agreements is guaranteed only through French mandatory laws
and international public policy, the contours of which have never been entirely
clear. This carries the risk that arbitration agreements will be held effective
without proper assurances of the parties’ consent, which runs counter to the
inherent contractual nature of arbitration. Because the substantive rule-method
is a minority position, critics have also viewed it as potentially disserving the
parties’ desire for legal certainty and predictability in dispute resolution.
One might wonder where to draw the line between the foregoing pro-
arbitration values. So far as the substantive-rule approach is concerned,
France has managed competing pro-arbitration assessments on a cost-benefit
basis. The French position is that the benefits of the substantive-rule method
to the overall efficacy of international commercial arbitration outweigh the
disservice it might possibly do to arbitration’s other values, be it consent to
arbitration or legal predictability and certainty.
IV. PRO-ARBITRATION VALUES AND EXTRINSIC CONSIDERATIONS IN

THE FRENCH TREATMENT OF PUBLIC POLICY
The challenge of reconciling pro-arbitration values and fundamental

considerations extrinsic to arbitration has come to the fore in the treatment of
public policy in annulment proceedings before French courts.
The French annulment regime of international arbitral awards pays great
deference to the substantive decisions of arbitral tribunals. The landmark case
Plateau des Pyramides of 1987 introduced a subtle yet crucial nuance to the
meaning of the so-called principe de non-révision au fond (non-revision on the

merits) under French arbitration law. The Court of Cassation stated that the
simple incorrectness on the merits of an arbitral tribunal’s decision cannot be
regarded as a valid ground for challenging international arbitration awards.
However, French reviewing courts would be entitled to inquire into both
factual and legal matters to rule on the limited grounds for annulment set forth
in the French Code of Civil Procedure (e.g., jurisdiction, due process, public
policy). In the early 2000s, a line of French authority abandoned this approach
by drastically raising the standard of proof required to establish a violation of
public policy. The Paris Court of Appeal’s decision in Thalès Air Défense v. GIE
Euromissile, followed by the Court of Cassation’s ruling in the Cytec case, held
that a violation of public policy must be “blatant, effective and concrete” in
order to warrant annulment. This “minimalist review” of arbitral awards on
matters of public policy has since been adopted on numerous occasions by French
courts. The Gulf Leader case, however, marked a reversal of the approach of
the Paris Court of Appeal. Since this 2014 decision, the Appellate Court started
to apply a more intensive scrutiny in cases involving claims of corruption,
money laundering or fraud. The Court of Cassation was yet to decide whether
it would affirm this new trend and overturn the Cytec requirement of a “blatant,
effective and concrete” violation of public policy in these specific matters. In
March 2022, the Court de Cassation in the Belokon case finally upheld the rationale
for re-evaluating the evidence and reviewing the arbitral tribunal’s determinations
on matters of public policy. At the time of writing, it remains to be seen whether
this invitation to consider issues of public policy de novo will go beyond the money
laundering circumstances that were at issue in Kirgiz Republic v. Mr. Belokon.
The foregoing cases call for reflection on the extent to which the validity and
enforceability of international arbitration awards should be subject to extrinsic
considerations of public policy. Some commentators have been critical of the
de novo judicial review of arbitral considerations of public policy as arguably
defeating some vital objectives of international arbitration, namely the
enforceability of arbitral awards, the finality of arbitral decisions and speed.
In their opinion, the suggestion that domestic judges are better able to finally
resolve public policy issues than arbitrators is mistaken and, more fundamentally,
calls into question the very adjudicatory power of arbitral tribunals. According
to these critics, arbitrators have been in the best position to hear witnesses,
weigh the evidence and thus take the full measure of the dispute.
Proponents of the opposite view consider that a more detailed inquiry into
the arbitrators’ resolution of issues of public policy is the necessary consequence
of the “second look doctrine”. National legislations have agreed to expand the
scope of arbitrable claims involving matters of public policy provided that
domestic courts can review arbitrators’ public policy decisions. In their views,
this is the counterpart of states’ tolerance towards international arbitration and,
by implication, a matter of legitimacy. One may also think that the exceptional
substantive review of arbitral awards on matters of public policy would operate
as a legitimate bulwark against the most serious abuses, such as corruption or

fraud. Greater reconsideration of both factual and legal matters of public policy
should enhance the confidence of users in the arbitral process. By promoting
the long-term legitimacy of arbitration, this increased scrutiny may thus be
regarded as a pro-arbitration policy.
V. CONCLUSION
Ironically, elaborating on the concept of pro-arbitration requires one to

reflect on what may seem to be “anti-arbitration” at first glance. The truth of the
matter is that the existence of international arbitration depends on the support
of the very national legislations from which it seeks to emancipate itself. This
is what Jan Paulsson has described as the “great paradox of arbitration”.
As the foregoing developments manifest, the extent to which the efficacy
of international arbitration should prevail over other pro-arbitration
considerations or extrinsic values part of a larger legal order raises the delicate
question of arbitration’s legitimacy. For this reason, the elaboration of pro-
arbitration policies and practices requires a search for balance that is as crucial
as it is complex.
A joint effort by decision-makers, practitioners and academics, as well as a
constant exchange of ideas among legal cultures, are undoubtedly the most
likely to find the best compromises to ensure the long-term legitimacy and
development of international arbitration.
Chapter 76
BEING “PRO-ARBITRATION” – WHAT DOES IT
MEAN FOR THE APPLICABLE LAW?
Moritz Renner*
I. INTRODUCTION
Professor Bermann’s class on “Transnational Litigation and Arbitration”

was, in many respects, a formative experience for me. When I took the class as
a 24-year-old exchange student in 2005, it was the first time I really heard
about international commercial arbitration. But I was also deeply impressed
by Professor Bermann’s engaging and thoughtful attitude as a teacher.
I read Professor Bermann’s 2018 article on “What Does it Mean to Be ‘Pro-
Arbitration’” as an expression of this attitude. It is at the same time very clear in
its firm support of a “pro-arbitration” stance and very nuanced in its normative
prescriptions. While Professor Bermann’s article mostly focuses on procedural
matters, this contribution sketches the implications of a “pro-arbitration”
approach regarding the applicable law in international commercial arbitration.
It will show that here, too, “it may actually be in international arbitration’s
best interest to advance values that are themselves extrinsic to arbitration.” As
a matter of the conflict of laws (infra A) the question of how to be “pro-arbitration”
can be framed as question of party autonomy (infra B) and its necessary limits
(infra C).
A. Conflict of Laws in International Commercial Arbitration
Usually, conflict-of-laws considerations do not figure prominently in arbitral

awards—although determining the applicable law is the necessary first step when
adjudicating an international dispute on the merits. This is for two reasons.
First, arbitral practice and large parts of the pertaining literature conceive
international arbitration as being largely detached from domestic legal systems.
From this perspective, in the words of Yves Derains, “there is no foreign law in
arbitration.” Second, most arbitrators follow a very pragmatic approach when
determining the applicable law and try not to get caught up in the intricacies
of (especially Continental European) theories of the conflict of laws.
However, arbitrators must answer the question of applicable law, and they
must do so in a matter that not only satisfies the legitimate expectations of the
parties, but also makes sure the arbitral award is effective and can withstand
* Moritz Renner is a Professor of Civil Law, International and European Commercial Law at
the University of Mannheim.

429
challenges in an annulment or enforcement action. Thus, the choice of law in

international commercial arbitration can and must be firmly grounded in the
principle of party autonomy. At the same time, it must respect the limits on
party autonomy that, in Professor Bermann’s words, “advance values that are
themselves extrinsic to arbitration.”
B. Choice of Law and Party Autonomy
It is undisputed that the principle of party autonomy is the crucial point of

reference for the choice of law in international commercial arbitration. As
evidenced by Article 28 of the 1985 UNCITRAL Model Law on International
Commercial Arbitration and Article 21 (1) of the 2021 ICC Rules, the principle
is universally recognized and customarily applied by arbitral tribunals. The
principle embodies the values of what is traditionally understood as a “pro-
arbitration” position. It leaves it for the parties to select the rules that they see fit
for resolving their dispute, and it makes the eventual resolution of the dispute
predictable.
Notably, the reach of party autonomy is much wider in international
commercial arbitration than it is before domestic courts. The parties are
considered almost entirely free in their choice of applicable law, for example
regarding the choice of non-state rules of law, whereas for example the EU
conflict-of-laws regime limits the freedom of choice to state legal systems
under Article 3 (1) Rome I Regulation. Moreover, in international commercial
arbitration the parties are not barred from—fully or partially—choosing a
foreign law even where ‘all other elements relevant to the situation at the time
of the choice are situated’ in one specific state, as Article 3 (3) and (4) Rome I
Regulation would have it.
C. The Limits of Party Autonomy
The wide reach of party autonomy in international commercial arbitration

necessarily prompts the question: What are its limits? This question is particularly
important from a “pro-arbitration” perspective in Professor Bermann’s spirit. As
much as widening the reach of party autonomy may seem to accommodate the
interests of the parties, in some instances both party interests and the practice
of international commercial arbitration in general are better served by clear
limits to party autonomy.
II. PARTY INTERESTS AND LEGITIMACY
As Professor Bermann’s article makes clear, international commercial

arbitration does not exist in a vacuum. Arbitral awards can be challenged with
annulment proceedings in the courts under domestic laws in accordance with
Article 34 of the UNCITRAL Model Law, and the recognition or enforcement of
arbitral awards can be refused by the courts under Art. V (2) of the 1958 New
BEING “PRO-ARBITRATION” – WHAT DOES IT MEAN FOR THE APPLICABLE LAW? 431
York Convention on the Recognition and Enforcement of Foreign Arbitral

Awards. In both cases, challenges can be based on the public policy of the
forum. Thus, the parties themselves have a manifest interest that the tribunal
considers the public policy both of its seat state and of possible venues for
recognition and enforcement of the award. This is reflected in Article 42 of the
ICC Rules which requires the tribunal to “make every effort to make sure that
the award is enforceable at law.”
At the same time, public policy considerations directly relate to the legitimacy
of international commercial arbitration. Oftentimes, international commercial
arbitration is watched with suspicion by legislators and the general public as
a means for “opting out of regulation.” It is assumed that parties choose
arbitration precisely to escape the reach of disadvantageous nation-state
regulations. As this perception gains ground, legislators are likely to (further)
curtail the arbitrability of legal disputes.
For these reasons, it will often by in the enlightened self-interest—and
thus fundamentally “pro-arbitration”—for arbitral tribunals to limit the reach
of party autonomy with public policy considerations. The challenge, then, remains
to meaningfully define the concept of public policy for the context of international
commercial arbitration.
III. PUBLIC POLICY IN INTERNATIONAL COMMERCIAL ARBITRATION
International commercial arbitration is a mechanism of dispute resolution

that is autonomous, but not completely detached from domestic legal systems.
Therefore, it makes sense to conceptualize public policy in international
commercial arbitration in different layers.
To the extent that arbitral tribunals must consider the public policy of their
seat and of possible venues for enforcement, the pertaining rules and principles
of domestic law form the first layer of public policy considerations. These rules
and principles are idiosyncratic in that they are not necessarily based on
internationally shared norms and values. A prominent and highly relevant
example is antitrust law, which according to US and EU case law binds arbitral
tribunals in largely the same manner that it binds domestic courts. Another
example is sanctions law. An example in point is the EU Regulation No. 269/2014
concerning restrictive measures in respect of actions undermining or threatening
the territorial integrity, sovereignty and independence of Ukraine. An
international arbitral tribunal would have to apply asset freezes based on the
Regulation irrespective of the law otherwise applicable to the dispute lest the
resulting award be enforceable by the courts of EU member states.
Beyond this first layer of public policy to be considered by international
arbitral tribunals there is a second layer comprised of those rules and principles
of public policy that are shared by all legal systems. They include not only ius
cogens norms of public international law, but also the prohibition of corruption
that has, with considerable impetus from the United States, in recent decades
been incorporated in legal systems all over the world. This second layer of
public policy is increasingly referred to as “transnational public policy.”
IV. CONCLUSION
The interplay of party autonomy and public policy can serve as an example
of “What it Means to Be ‘Pro-Arbitration.’” As Professor Bermann impressively
demonstrates in his homonymous article, as well as in his teaching, being “pro-
arbitration” presupposes a meticulous analysis of the interests at stake—and
of the context in which international commercial arbitration operates. This
holds true not only for procedural aspects, but it equally applies to the question
of the applicable law. Here, reflecting on what it means to be “pro-arbitration”
may help us not to get lost in the maze of conflict-of-laws analysis, and keep our
sights on functional considerations. Ultimately, these functional considerations
determine whether arbitration will succeed in any given case, but also as a
means of dispute resolution more generally.
Chapter 77
DOCTRINAL COHERENCE AS A
“PRO-ARBITRATION” VIRTUE
Myron Phua*
I. INTRODUCTION
In “What Does it Mean to Be ‘Pro-Arbitration’?” (2018) 34 Arbitration

International 341–353, Professor Bermann argued that:
1. a rule or practice associated with international arbitration is “pro-

arbitration” to the extent that it advances international arbitration’s
interests (at 342);
2. these interests are not limited to virtues traditionally associated with
arbitration-friendliness. They include the promotion of values extrinsic
to international arbitration if that increases the legitimacy of international
arbitration (at 349–352); and
3. it may be that a rule or practice is “pro-arbitration” when viewed through
one lens, but arbitration-unfriendly when viewed through another.
However, “acknowledging legitimacy—measured in terms of extrinsic
values—as in itself a pro-arbitration attribute may be among the most
arbitration-friendly moves one can make” (at 353).
Building on these ideas, I argue that:
1. one such “extrinsic value” which may enhance international arbitration’s

legitimacy is the coherence of international arbitration doctrine with
similar (or related) rules and concepts in general contract and private
international law; and
2. where a lex specialis rule of international arbitration law differs from
its more general counterparts in contract or private international law,
it should be asked whether that divergence is justified by how some of
the policies and needs of international arbitration are different. In
many cases the “exceptionalism” of international arbitration doctrine
will be well-warranted, but that is not always so.
* Myron Phua is an Associate at Herbert Smith Freehills; BCL (Oxon.); JD (Columbia).

433
II. “LEGITIMACY” AND “COHERENCE” AND WHY IT MATTERS
Some definitions are necessary, as much has been written about these
concepts. For present purposes:
1. “Legitimacy” refers to the quality of a legal rule (or practice) conforming

to sound policy and/or morality (see James Crawford, “The Problems of
Legitimacy-Speak” (2004) 98 ASIL Proceedings 271 at 271–272); and
2. “Coherence” imports both logical consistency and normative congruency
(see Julie Dickson, “Interpretation and Coherence in Legal Reasoning”
in The Stanford Encyclopedia of Philosophy (Winter 2016 Edition) at
§ 3.1). That is to say, a legal rule or practice is coherent if it:
a. is logically consistent with other rules (or practices) in the same or

related area(s) of law in the same legal system (or the legal concepts
underlying them); and
b. promotes the same policies that are served by those other rules,
practices, or concepts.
Doctrinal coherence has a legitimising function. All things being equal, the
coherence of a legal rule (or practice) with other related rules (or practices) makes
it more likely to be legitimate than if it did not cohere. This is for two reasons:
1. First, assuming that the other rules or practices are themselves legitimate,
the fact that a rule or practice is logically consistent and normatively
congruent with them makes it likely to be similarly legitimate.
2. Second, coherence increases certainty, clarity, and predictability in the
application of legal doctrine, all of which are rule of law virtues (see,
e.g. Joseph Raz, “The Relevance of Coherence” (1992) 72 B. U. L. Rev. 273
at 313; Peter Birks, “Equity in the Modern Law: An Exercise in Taxonomy”
(1995) U. W. A. L. Rev. 1 at 87).
But this is to generalise. That a legal rule does not cohere with other related
rules need not make it illegitimate if there exists an adequate normative
justification for it. For example, the “separability” principle is conceptually
inconsistent with how provisions in a contractual document are not treated as
separate contracts for determining their existence or validity in general
contract law. But “separability” is justified, as a matter of policy, by the unique
requirements of arbitration. Without “separability”, an arbitral tribunal would
not be able to rule that the contract containing the arbitration agreement is
invalid without undermining its own jurisdiction to make that ruling.
Accordingly, any conceptual incoherence ensuing from pretending that an
arbitration clause is a separate contract for the purposes of determining its
validity is a necessary evil.
DOCTRINAL COHERENCE AS A “PRO-ARBITRATION” VIRTUE 435
However, in the absence of an adequate policy justification for a rule of

arbitration law to be inconsistent with its analogues in related areas of law, its
legitimacy may suffer. For instance, if there were a rule that an arbitration
agreement can never be terminated or varied, the fact that there would be no
apparent reason why arbitration agreements should be treated differently
from other contractual relationships in that particular respect suggests that it
is probably unsound.
It is not always easy to assess whether a particular instance of doctrinal
incoherence is ultimately justified by the policies and needs specific to
international arbitration. Owing to the prima facie desirability of doctrinal
coherence, however, the onus of proving an adequate justification exists rests
with those advocating for “exceptionalism.” For example:
1. Some commentators argue that an award which has been annulled by

the courts of the arbitral seat should categorically be incapable of being
recognised in another jurisdiction. But the act of annulling an award is
a judicial act, and so the proposition being advanced contradicts the
ordinary rule in private international law that foreign judicial acts can
be denied recognition under certain circumstances. Thus, the onus lies
on those arguing that annulled awards should never be recognised to
explain why annulment judgments ought always to be recognised. To
advocate such a deviation from general private international law
requires a proper policy justification.
2. Others have argued that the “separability” doctrine should make an
arbitration agreement a separate contract not only for the purposes of
determining its existence and validity, but for all other purposes (e.g.,
choice of law). Such a proposition is inconsistent with how, in general
contract law, a provision in a contractual document is not a free-
standing contract. There does not appear to be any good policy reason
why arbitration agreements should be treated differently more than is
necessary.
III. SOME EXAMPLES FROM THE ENGLISH CASES
Once it is recognised that doctrinal coherence has a (potentially) legitimising

function, it follows that the legitimacy of international arbitration law and
practice may well be affected by its doctrinal coherence with related areas of
law. Two such areas come immediately to mind.
1. The first is general contract law. This should be apparent, since the
juridical foundation of practically all non-treaty arbitrations is a contract
to arbitrate, creating contractual rights and duties.
2. The second is the conflict of laws (or, synonymously, private international
law). The rules of arbitration law which deal with the jurisdiction of
international arbitral tribunals relative to the courts, choice of law

issues, and the recognition and enforcement of international arbitral
awards, are lex specialis private international law rules. Indeed, it may
well be that all of international arbitration—the “quintessential private
international law endeavour” (George Bermann, INTERNATIONAL
ARBITRATION AND PRIVATE INTERNATIONAL LAW (2017) at 17)—should be
characterised as a special and more “private” and “international”
branch of private international law: underlaid by a number of common
policies and ideas but also possessing its own unique ones.
But the fact that international arbitration has its own policies and needs
which are not necessarily shared by general contract and private international
law entails that doctrinal coherence can only be only a situational virtue.
Where a lex specialis rule of arbitration law differs from related rules in
contract or private international law, it should be asked whether such a
discrepancy is nevertheless justified by how some of the policies and needs of
international arbitration are not the same as those informing the lex generalis.
Often there will be good reason for international arbitration doctrine to
diverge from the orthodoxies of general contract and private international law.
But that is not always so. A few examples, taken from English law, illustrate
both tendencies:
1. In Enka v. Chubb [2020] UKSC 38, the UK Supreme Court held (at [159]–
[160], read with [155]) that the test for identifying an implicit choice
of law to govern an arbitration agreement was practically the same as
that under the Rome I Regulation (which applies to most contractual
obligations but not arbitration agreements). This approach is sound.
The doctrinal incoherence that would result from applying a different
test for arbitration agreements specifically would not have been justified
by virtue of any relevant difference in the policies and practical needs
of arbitration.
2. It was also held in Enka that, absent a choice of law, an arbitration
agreement would normally be governed by the seat law rather than the
law governing the contract containing it. This was notwithstanding
how, in general private international law, the parties to a contract are
presumed not to have intended to choose different laws to govern
different parts of it (viz. a presumption against depeçage). Whilst the
dissenting judges viewed this as a doctrinally incoherent result, the
majority (correctly) pointed out that it was justified by the different
policies and needs of international arbitration (see [2020] UKSC 38 at
[118]–[146]).
3. In English law, an arbitration agreement is construed purposively to cover
any dispute relating to the parties’ relationship (i.e., including non-
contractual claims), even if worded to encompass disputes “arising
under” the contract (Fiona Trust & Holding Corp v. Privalov [2007]
UKHL 40, at [13]). This differs from how provisions in commercial
contracts between sophisticated parties are normally given a more
text-centric interpretation (see, e.g., National Bank of Kazakhstan v.
Bank of New York Mellon [2018] EWCA Civ. 1390 at [39]–[40]). Such an
approach is nevertheless justified by the practical needs of arbitration
and how arbitration agreements are “midnight clauses” (BCY v. BCZ
[2016] SGHC 249 at [61]).
4. English courts have held that the issue of whether someone who was
originally a non-signatory to a contract had subsequently become a
party to the arbitration agreement in that contract was governed by
the law that would govern the arbitration agreement if the non-signatory
had indeed become a party (i.e., the putative lex contractus). Typically,
this would lead to the law selected under any general choice of law
clause in the contractual document applying. Such an approach was
said to be justified because the general rule in English conflict of laws
was to apply the law of the putative contract to determine whether the
alleged contract exists between the relevant parties (see Kabab-Ji SAL
v. Kout Food Group [2021] UKSC 48 at [27]). It is, however, arguable that
a different rule should apply to arbitration agreements, given (i) the
emphasis that arbitration places on the consent of its participants to
the process, and (ii) how the alleged non-party would be claiming in
such a case that it did not accede to the choice of law clause originally
inserted by someone else (see RESTATEMENT OF THE U.S. LAW OF
INTERNATIONAL COMMERCIAL ARBITRATION at § 2.15, note a).
5. The English High Court has recently held that an English-seated tribunal
should apply English law (and with it, the Henderson v. Henderson
principle) to determine whether a party was barred from making
arguments which it could and ought to have raised in earlier
proceedings (Union of India v. Reliance Industries Ltd & Anor [2022]
EWHC 1407 (Comm)). It reasoned that a tribunal was correct to apply
the general conflict of laws rule that “procedural” issues were matters
for the lex fori (which, in the context of an international arbitration,
was the seat law). At first glance, it might be thought that the need for
doctrinal coherence warrants such an approach. However, it is generally
expected in international arbitration that arbitral tribunals should
enjoy a generous degree of discretion over procedural matters, and
should not be bound to apply the conflict of laws rules of the seat law.
It is therefore arguable that an English-seated tribunal ought to have a
discretion to apply a different law to determine “procedural” issues if
it considers appropriate.
6. In another recent case, the English Court of Appeal held that the law
governing the issue of whether a non-party to a contract containing an
arbitration agreement was nevertheless bound by the arbitration
agreement (by virtue of having been assigned a trademark to which the

“burden” of the arbitration agreement had been annexed) was
governed by the law of the arbitration agreement (Lifestyle Equities CV
v. Hornby Street (MCR) Ltd [2022] EWCA Civ. 51). This arguably results
in an unjustified discrepancy between the lex specialis and lex generalis.
One of the central policies informing choice of law approaches in
general private international law is that, in the absence of a choice of
law made by the relevant parties to govern a particular issue, it ought
to be governed by the system of law with which it has the most
normatively salient connection. That system of law, in a case where a
non-party is alleged to be bound by an arbitration agreement as a
result of having acquired a substantive private law right, is arguably
the law governing the substantive right in question and not the law of
the arbitration agreement.
7. It was once argued before the UK Supreme Court that the “validation
principle,” being the principle that a court should infer that the parties
to an arbitration agreement did not choose a law that would invalidate
or stultify it, should also apply for the purposes of identifying the law
governing the issue of whether an arbitration agreement existed (see
Kabab-Ji SAL v. Kout Food Group [2021] UKSC 48 at [49]–[52]). The
court rejected this argument, and rightly so. Prior to its restatement in
Enka v. Chubb, the “validation principle” existed as a general principle
in English private international law (albeit under a different, and less
conspicuous, label), and it never applied to the issue of whether a
contract existed to begin with. There is no reason of policy why the
principle should differ in that way for arbitration agreements. The
resulting doctrinal incoherence would not have been justified.
8. By contrast, in Enka v. Chubb, the same court observed that the
“validation principle,” in addition to its traditional function, operated
in the international arbitral context to make it that the parties to an
arbitration agreement should be inferred not to choose a law under
which it would be construed too restrictively. Whilst this represents an
unprecedented modification of the original principle for international
arbitration (as one of the dissenting judges had pointed out: [2020]
UKSC 38 at [198]), it is arguably justified. Parties to an arbitration
agreement normally intend that the process they have selected should
serve as a “one-stop-shop” for the resolution of their disputes. To
construe an arbitration agreement restrictively would be to deprive it
of its intended commercial efficacy in most cases.
9. English courts have held that a party would not commit a repudiatory
breach of an arbitration agreement by litigating a dispute falling within
its scope in another forum as long as that party was still willing to
proceed with the arbitration proceedings in parallel (see the discussion
in (2022) 138 Law Quarterly Review 131 at 137–140). This approach
appears to be unjustifiably inconsistent with how, under general English

contract law, a party commits a repudiatory breach of contract if its
breach deprives the innocent party of substantially the whole benefit of
that which it was promised (or, in other words, goes to the “root” of the
contract). Parallel proceedings are precisely what the parties to an
arbitration agreement “aimed and bargained to avoid” (see The Front
Comor [2007] UKHL 4 at [30]). The maintenance of such proceedings for
a non-negligible duration is arguably serious enough to be repudiatory.
These are but a few examples, taken from a single legal system. Yet they
evince that doctrinal coherence can, but need not always be, a desideratum:
1. Insisting on coherence where there are good reasons for the rules and
practices of international arbitration to differ from their lex generalis
counterparts—on account of the policies and needs unique to
international arbitration—would scarcely be legitimising.
2. Conversely, however, where the policies and considerations peculiar
to international arbitration do not justify the application of a different
rule or approach, then doctrinal coherence will be a “pro-arbitration”
virtue.
In that way, both exceptionalism and orthodoxy have their proper place.
Chapter 78
INTERNATIONAL ARBITRATION’S SECTION 1782
CONUNDRUM
Nicolas Teijeiro*
I. INTRODUCTION
28 U.S.C § 1782 (Section 1782) grants U.S. federal courts the power to
order discovery from any person in the United States, “for use in a foreign or
international tribunal.” When this note was first drafted, there was uncertainty
as to whether Section 1782 applied to international commercial arbitration,
which had given rise to a rooted circuit split (the “Section 1782 conundrum”).
However, on June 13, 2022, in ZF Automotive US, Inc. v. Luxshare, Ltd. and
AlixPartners, LLC v. Fund for Protection of Investors’ Rights in Foreign States, the
U.S. Supreme Court resolved the Section 1782 conundrum, holding that a
private international arbitral tribunal does not qualify as a “foreign or
international tribunal” under Section 1782.
On its face, this short note is a modest reflection on whether Section 1782
(as it will continue to apply to “governmental or intergovernmental adjudicative
bodies”) or any similar policy or practice that may become available in the
future in any jurisdiction may be deemed to be “pro-arbitration”. If such were
the case, the withdrawal of Section 1782 assistance to international commercial
arbitration could be construed as “anti-arbitration.”
On a more profound level, this piece is just a pretext to take part in a tribute
to a brilliant Professor from whom I have learned the amusing intricacies of
the law of transnational litigation and arbitration in the United States. I was
extremely privileged to attend his acclaimed course at Columbia Law School in
the fall of 2011, and I am very grateful to Kabir Duggal and his team at Columbia
Law School for organizing this collective effort and inviting me to participate
more than ten years later.
II. IS SECTION 1782 “PRO-ARBITRATION”?
As Prof. Bermann has so eminently put it, a policy or practice may be “pro-
arbitration” on a number of measures, and even favor arbitration in some ways
and disfavor it in others. Certain considerations that are not strictly arbitration-
* Nicolas Teijeiro is a Graduate of Columbia Law School (LL.M., 2012) (Harlan Fiske Stone
Scholar) and focuses his professional practice on cross-border transactions and international
disputes. Nicolas is admitted to practice law in the State of New York and Argentina.
441
related also come into play, such as broader policy goals including the promotion
of efficient transnational dispute resolution in the case of Section 1782.
Prof. Bermann has done a terrific job in describing the criteria for gauging
how arbitration may be favored or disfavored generally by certain policies or
practices. Here, I briefly expand on a few of his considerations to discuss how
the advantages of having Section 1782 in international arbitration outweigh
any disadvantages. The views and opinions expressed herein are my own and
do not necessarily represent the views of my firm or clients.
• To what extent would Section 1782 render international arbitration

economical in terms of time and cost?
Litigating in the United States can be a costly enterprise. Yet, a party

seeking Section 1782 discovery for use in international arbitration could find
such a tactic to be cost-effective if it likely produced testimony or documents
that would be otherwise unavailable and material to the arbitration; evidence
that could potentially be outcome-determinative.
In terms of time, a Section 1782 discovery request would not necessarily
lengthen the time of an arbitration proceeding, especially if the application
were narrowly-tailored to a specific claim brought in the arbitration. Conversely,
any relevant piece of evidence found in the United States that would help bring
the truth to light could significantly streamline the arbitral process, thus
shortening the overall time required to resolve a dispute.
Nevertheless, unwarranted discovery requests, including fishing expeditions,
could definitely add considerable time and cost to an arbitration in addition to
possibly resulting in overlapping parallel proceedings, which might potentially
yield inconsistent results.
• To what extent would Section 1782, consistent with party intent, enable
the tribunal to exercise sound discretion and flexibility on matters of
arbitral procedure?
The parties to an arbitration agreement are free to choose any kind of

arbitral procedure. While arbitral tribunals are generally expected to control
all procedural aspects of the arbitration (including discovery applications,
their scope and timing), an arbitral tribunal may avail itself of Section 1782 to
enforce discovery orders in the United States (a power it naturally lacks). In
this light, Section 1782 would be a clear arbitration “goodie” when used in
connection with a discovery request that were supported by the arbitral tribunal
(implicitly or explicitly). In fact, Section 1782 could only expand the toolkit
available to arbitral tribunals in the realm of discovery and enforcement in the
United States.
However, less clear is whose discretion should “control” in any international
discovery request where there was disagreement between the arbitral tribunal
INTERNATIONAL ARBITRATION’S SECTION 1782 CONUNDRUM 443
and the courts as to whether a Section 1782 application should be granted.

From the perspective of party autonomy, the views of the arbitral tribunal (who
has primary authority over fact-finding and procedure) should arguably be
afforded a higher degree of deference, at least where the application was
sought against a party to the arbitration.
Even in the case of a third-party target, inasmuch as Section 1782 is
premised on the provision of assistance to foreign or international tribunals, it
seems that the arbitral tribunal should have some kind of bearing on the
Section 1782 discovery request, lest we risk the production of useless evidence
that potentially undermines the efficiency-furthering goal of Section 1782.
• To what extent would Section 1782 effectuate the likely intentions or

expectations of the parties?
When the parties agree to submit their disputes to arbitration, their likely
intent is to take their cases away from the courts, including with respect to any
discovery issues. Accordingly, a party who consented to arbitration and never
contemplated having to face (or suffer to exist) a parallel U.S. litigation, could
ultimately find its arbitration expectations frustrated before any Section 1782
application, especially if such proceeding lingers and complicates the arbitration.
However, as it is widely shared, party-initiated discovery usually secures
the best proceedings in terms of transparency, reliability and fairness. As the
parties have a vested interest in getting the facts right, completely giving away
Section 1782 in the absence of express party agreement to that effect could be
a sacrifice too high to make.
• To what extent would Section 1782 minimize, to the fullest extent reasonably
possible, the intervention of national courts in the arbitral process?
As discussed above, Section 1782 provides the federal courts the power to
compel the production of materials in the United States in aid of a foreign or
international proceeding. The federal courts are permitted but not required to
provide such assistance.
Any Section 1782 discovery that would ultimately be rejected by the
relevant arbitral tribunal could be perceived, in retrospect, as unsolicited judicial
interference in the arbitration. However, by the same token, any Section 1782
discovery ultimately endorsed by the arbitral tribunal, or that would otherwise
be beneficial to the conduct of the arbitration, could enhance the overall
legitimacy of the dispute resolution system.
To address the risk of abuse by unscrupulous litigants who could employ
Section 1782 to derail an arbitration, Intel and its progeny had offered certain
discretionary factors that kept the broad power of the courts under Section 1782
in check.
In accordance with one of those factors, for example, that a tribunal would
be “receptive” to the federal court’s assistance tilted discretion towards discovery.
Under another factor, concealed attempts to circumvent any discovery
restrictions in the foreign proceeding were not allowed to go forward. Although
these determinations were factual in nature and could be complex in practice, the
federal courts were (and still are) well equipped to preclude any Section 1782
discovery abuse from materializing through the exercise of sound discretion.
III. CONCLUSION
Many of the above considerations have become irrelevant or moot in light

of the recent Supreme Court decisions quashing Section 1782’s availability in
international commercial arbitration. Unfortunately, many of the potential
benefits of Section 1782 have also been lost.
To be clear, the mere existence of uncertainty over the applicability of
Section 1782 to international commercial arbitration was arguably detrimental
to arbitration in itself since it undermined the predictability expected by the
parties when arbitrating their claims, including with respect to the smooth
relationship between arbitral tribunals and the federal courts that is necessary
for arbitration to thrive. In this vein, the recent Supreme Court decisions
resolving the Section 1782 conundrum should be welcomed.
However, Section 1782 could be a very useful tool in international
commercial arbitration, to facilitate discovery that could be otherwise unavailable
and material to the efficient resolution of a transnational case. While such
application of Section 1782 conceivably increased the risk of abuse by litigants
attempting to use it to frustrate the arbitration expectations of their
counterparties, the risk of parallel litigation and judicial interference was not
new in the law and practice of international commercial arbitration in the
United States. Section 1782 only required the federal courts and international
commercial arbitral tribunals to cooperate closely on discovery matters in
order to prevent any inconsistent rulings from impacting the overall efficiency
of the dispute resolution process.
In my opinion, assuming the appropriate measure of judicial prudency and
self-restraint, the advantages of having Section 1782 apply to international
commercial arbitration outweighed any disadvantages. Absent litigation abuse,
Section 1782 is clearly “pro-arbitration”.
While (generally) it’s no use crying over spilled milk, it already feels like
Section 1782 will be missed.
Chapter 79
ARBITRATION’S DURABILITY: MEETING NEEDS
IN A CHANGING LANDSCAPE
Nika Madyoon*
I. INTRODUCTION
Having graduated from law school relatively recently, and having just taken
my first formal steps into the world of legal practice, I must admit that the
prospect of opining on what it really means to be “pro-arbitration” is a daunting
one. Indeed, as Professor Bermann acknowledges, the concept itself is
multifaceted, and sometimes—when one is faced with competing considerations
of similar weight—even nebulous. The determination of whether a particular
practice or idea is pro- or anti-arbitration often changes depending on the lens
through which we examine it. It often requires difficult judgment calls,
foresightedness, and where the cases are too close, leaps of faith.
In light of these inherent complexities, I cannot say with certainty what it
means to be “pro-arbitration,” or what this concept will demand from us all
moving forward. But what I do know, for sure, is that I find myself where I am
today precisely because of it. The force of this “pro-arbitration” mindset,
espoused by Professor Bermann and the students and practitioners he has
trained, is evidenced by the sincere commitment I already feel—and have felt
for some time—to the field of international arbitration. From where I stand
(that is, the very beginning), the future of my career and of international
arbitration is wide open. But the field is also fraught with challenges I can
already see, and hazy from growing clouds of criticism. At the risk of restating
what most of us know—and mindful of the impressive careers most of my co-
contributors to this volume have already built—I am hopeful that what I can
offer is a very humble assessment of what international arbitration must
achieve in order to survive, and thrive, in the future.
“What Does it Mean to Be ‘Pro-Arbitration’?” As I contemplate the question,
I find that looking backwards can provide a powerful catalyst for moving
forward—that what has already been done may, paradoxically, be an excellent
template for what to do next. If we can approach the future of international
arbitration with a fraction of the commitment, practicality, and creativity that
Professor Bermann has brought to the field, we will be well on our way. More
specifically, to ensure the longevity and success of international arbitration,
we must continue to focus on one essential project: meeting needs.
* Nika Madyoon is a J.D. from Columbia Law School, 2021.

445
II. THEN, AND NOW
Professor Bermann and his colleagues are the generation that founded
modern international arbitration. They worked tirelessly, and inventively, to take
what was once a relatively loose framework of treaties, procedural regulations,
and under-developed domestic arbitration laws, and forge what is now the most
effective mechanism for resolving international disputes. Underlying their
indispensable contributions, however, were certain fundamental factors that
contributed to the initial rise of international arbitration.
Namely, international arbitration rose to prominence due to its unique
ability to meet certain needs. At the outset, some of these needs were: (i) to
establish a neutral and enforceable method for resolving commercial disputes
between actors of different nationalities, with rulings that would have teeth
across jurisdictions; (ii) to encourage foreign direct investment, and protect
disputes between States and foreign investors from the turbulent realms of
politics and diplomacy; and (iii) to create harmony between the national and
international legal planes, by modernizing the domestic arbitration laws of States
to account for important substantive and procedural issues. These initial needs
gave us, respectively, (i) the New York Convention, (ii) the ICSID Convention
(and by now, over 3,000 investment treaties), and (iii) the UNCITRAL Model Law
and the UNIDROIT Principles.
As this initial framework matured over time, other needs began to reveal
themselves. These included (i) the need to provide clear and detailed guidance
on the role of U.S. courts over the life cycle of arbitral proceedings, and (ii) the
demand for greater public transparency around both commercial and investor-
State disputes. Addressing these needs—and the myriad others that reared
their heads over the decades—was no small feat. Professor Bermann took the
challenges head-on anyway. The first one, on its own, required marshaling every
ounce of political will possible, over twelve years, to build consensus and complete
the Restatement of The U.S. Law of International Commercial and Investor-
State Arbitration as its Chief Reporter. By the time I first encountered the
Restatement in my second year of law school, the only job left was to cite-check
the footnotes in Chapters 2, 4 and 5. And I am only half-joking when I say that
this alone remains one of the more formidable tasks I have ever accomplished.
Today, the international business, legal, and political environment in which
we find ourselves continues to evolve rapidly. Accordingly, the set of needs that
international arbitration must meet has once again changed. The practical
demands and objectives that private actors, States, and all other arbitration
stakeholders face are pressing and complex. They include, among many other
things: (i) leveraging technology to maximize efficiencies, while also safeguarding
the integrity of proceedings, (ii) making the shift, at the institutional and counsel
level, to a client mindset, and (iii) suppressing the increasingly disruptive use of
“guerrilla tactics.” In addition to these more practical needs, there is an equally
pressing, more existential imperative to defend the legitimacy of international
ARBITRATION’S DURABILITY: MEETING NEEDS IN A CHANGING LANDSCAPE 447
arbitration. The field is under unprecedented attack as it relates to issues such

as transparency, diversity, and even climate change.
III. LOOKING AHEAD
Arbitration, at the end of the day, is an option on a list of dispute resolution

mechanisms. It is only as valuable as it is able to meet the needs of those who
utilize it. It is only as relevant as it is able to co-exist with local, regional, and
international legal institutions. Revisiting aspects of international arbitration
so as to ensure that it continues to meet the needs of stakeholders, then, is not
a plus; it is a prerequisite.
Technology—The Covid-19 pandemic was transformative for international
arbitration, in large part due to the forced transition to virtual hearings.
Although arbitration was no stranger to videoconferencing, it was very rare to
see full merits hearings being conducted by video prior to the pandemic.
Despite widespread recognition in the field surrounding the need to better
harness technology—to reduce travel time, costs, and environmental impact,
among other valid reasons—the needle was moving very slowly for some time.
Once the pandemic mandated remote participation, however, parties, counsel,
and tribunals had no choice but to pivot or adjourn their proceedings indefinitely.
Faced with this need, arbitral institutions developed new procedural guidance
and assistance with impressive speed; law firms quickly emerged as thought
leaders when it came to pre-emptively addressing due process concerns; and,
having gone through with virtual hearings, many arbitrators adjusted their
previous attitudes toward contentious issues, such as ascertaining the veracity
of witness testimony via video. Though Covid-19 measures represented an
extreme adaptation, the circumstances during the pandemic were fertile ground
for testing the many ways technology can enhance the arbitral process. Moving
forward, there is plenty more to do in terms of embracing and incorporating
these lessons. Though it goes without saying, finding the balance between
technological efficiency and protecting the integrity of proceedings is a crucial
enterprise for keeping arbitration relevant and accessible.
Client Mindset—The concept of re-orienting international arbitration
toward a “client mindset” is the brain-child of Claudia Salomon, current President
of the ICC International Court of Arbitration. Put simply, the idea is that all
aspects of the arbitral process are due to be reconceptualized, so that the needs
and objectives of clients are the driving force behind it all. Ms. Salomon’s
approach is a nuanced one—it acknowledges the important reality that “clients”
are not a monolith, and that their goals once they enter the realm of arbitration
can vary significantly depending on their particular circumstances. Arbitrators,
institutions, and counsel must focus on identifying and prioritizing those goals
on a case-by-case basis—even where the goal is, ultimately, to avoid arbitration
altogether. Indeed, Ms. Salomon reminds us that arbitration is a means to an
end, not the end in itself. Clients come to arbitration because it promises a
bespoke, efficient, nimble method for resolving their disputes—they don’t

come to arbitrate for arbitration’s sake. Thinking critically about the ways our
arbitration infrastructure can better serve their needs, even if it entails a
fundamental shift, is an essential and exciting exercise.
Addressing guerrilla tactics—A final and interesting practical area in which
arbitration stands to improve has to do with its ability to manage “guerrilla
tactics,” or disruptive procedural tactics employed by parties who seek to
game the system to their advantage. The rise in these maneuvers is troublesome,
and it threatens much of the fairness and efficiency that draws parties to
arbitration in the first place. Regrettably, tribunals have struggled to keep such
tactics in check, most likely for want of an official basis for doing so (since
institutional rules and domestic arbitration regulations do not explicitly
prohibit such strategies). Creative solutions are needed to empower tribunals
to actively correct for these “guerrilla tactics,” and hopefully, discourage their
use in the first place. My colleague, E Jin Lee, presents a compelling approach
to the problem in his chapter.
Overall legitimacy—While the aforementioned practical challenges (among
others) are important for the arbitration community to address, I think the
continued success and longevity of international arbitration turns, perhaps
most heavily, on its willingness to embody certain core values. Among these
are transparency and diversity, in all its forms. It is essential, for example, that
practitioners, leaders, and arbitrators be representative of the world they
serve. This not only gives the system legitimacy, but allows it to flourish.
Thankfully, we have already seen positive strides in this area, and I am hopeful
there is much more to come. Improvements relating to transparency are also
of the utmost importance. While the UNCITRAL Rules on Transparency in
Treaty-based Investor-State Arbitration represented a significant step forward,
stakeholders continue to demand more. What is to be done, for example, where
an investor and a State reach a settlement agreement prior to (or during the
course of) their arbitration proceedings? The U.N. Working Group III continues
to grapple with such questions in the ISDS context. The way the international
arbitration community responds to these fundamental, more substantive
critiques will most likely determine the degree to which arbitration is able to
thrive in the future, and maintain its status in the international legal order.
IV. CONCLUSION
International arbitration faces many challenges moving forward. It is our

duty, now, to adapt the practice of international arbitration so that it remains
durable—to ensure that it continues, at all levels, to meet the needs of its
participants. It is our responsibility to safeguard the institution Professor
Bermann has dedicated his career to building.
We must be very careful not to dismiss these modern demands as superficial
changes, or mechanical updates that only serve to “enhance” or “streamline”
ARBITRATION’S DURABILITY: MEETING NEEDS IN A CHANGING LANDSCAPE 449
the arbitral process. In reality, they are as fundamental to arbitration’s health

and long-term viability as many of the demands faced by previous generations.
In order for arbitration to continue to meet the needs of clients (whether
commercial parties or States), and to maintain its pole position in the global
dispute resolution framework, it needs to embrace some uncomfortable changes.
“Pro-arbitration” is as “pro-arbitration” does. So much of Professor Bermann’s
legacy has flowed from his passion for looking forward, for imagining what is
possible and making it real. The progress this field has seen, over his nearly
five decades at its helm, was only possible because of this commitment to
adapting over time—the awareness that the needs of users and systems are
going to change, and more importantly, the willingness to innovate and meet
those challenges as they present themselves.
In my experience, Professor Bermann has this same forward-looking quality,
and genuine level of investment, when it comes to people. Those of us who
have had the privilege to learn from him know the way he breathes life into
academic material—weaving complex jurisprudence with captivating accounts
of lived experience. To discuss any arbitration topic with him—indeed, to
discuss any topic with him at all—is to pick up a book one never wants to stop
reading. He is, in the most honest way, an example of what it is to find true
meaning and joy in one’s work. From the very start of my legal education,
Professor Bermann believed in me, challenged me, and gave me the tools to
grow. Over the years, I had the great honor of being not only his student, but
also one of his Research Assistants, and later, Teaching Assistants. These
experiences helped me to discover the depth of my interest in international
arbitration, and changed the course of my life. I will cherish them forever.
Chapter 80
SEARCHING FOR BALANCE IN JUDICIAL
TREATMENT OF ARBITRAL AWARDS SET ASIDE
AT THE SEAT
Nikolay A. Ouzounov*
I. INTRODUCTION
The theoretical and practical landscape of international arbitration

continuously evolves fueled by the constant debate about the nature and
ultimate purpose of arbitration. Part of the discussion among scholars and
practitioners alike echoes the question raised by Professor George Bermann
about what it means to be “pro-arbitration”. Answering that question necessitates
a careful inquiry into the delicate balance among competing interests that
come into play when examining the overall arbitration friendliness of a given
policy or practice. One of the main issues central to that inquiry is the role of
the courts over the life cycle of an arbitration.
Courts play different roles at various stages of the arbitral process that may
affect the overall accuracy, efficiency, and enforceability of the arbitral awards.
In that regard, judicial treatment by national courts of arbitral awards set aside
at the seat is an important consideration when evaluating whether certain
policy or practice is arbitration friendly.
As can be expected, courts in different jurisdictions have different views
on whether an arbitral award set aside at the seat survives and retains its legal
effect in another jurisdiction. A critical question is whether a set-aside by a
national court invalidates the award or denies it legal effect abroad. In other
words, the question that arises is whether an award invalidated at the seat
should produce effects in other jurisdictions and, if that is the case, to what
extent. The annulment of an award raises a whole panoply of related issues—
must courts in foreign jurisdictions recognize the annulment judgment or, to
the contrary, the vacated award? In that regard, can a foreign court recognize
either the award or the court judgment consistent with the text and tenets of
the New York Convention (the “Convention”) and its national law obligations?
The Convention is largely silent on these issues and national courts in different
jurisdictions have provided different, often contradictory, answers.
Unsurprisingly, there are diverging views on whether an annulled award may
be recognized by a court in a foreign jurisdiction. Broadly speaking, these
* Nikolay A. Ouzounov is a Member of the International Arbitration Chambers in New York
and resident in Sofia, Bulgaria. He is a J.D. from the University of Illinois Chicago School of Law
and holds a LL.M. from Columbia Law School. He is a Member of the Bar in New York and Illinois.
451
different views can be grouped into three positions: (1) the ex nihilo nihil fit
position according to which an award that has been set aside at the seat ceases
to exist and therefore there is nothing left to recognize or enforce; (2) the
award annulment does not prevent its recognition or enforcement since the
award belongs to a transnational legal order that is divorced from the seat; and
(3) a balancing position termed by some scholars the “judgment route”, according
to which judges should look at the law on recognition and enforcement of
foreign judgments for guidance as to when courts should refuse to recognize
or enforce an award set aside at the seat.
II. LIFE AFTER ANNULMENT AND TWO OPPOSING VIEWS IN SEARCH

OF A SOLUTION
At one end of the interpretational spectrum is the view that the New York
Convention does not allow for recognition and enforcement of arbitral awards
set aside in the country of origin. This is because, according to some scholars,
the setting aside of an arbitral award has an “erga omnes effect” meaning that
once the award has been annulled at the seat, it is no longer eligible for
recognition and enforcement in the States parties to the Convention. This line
of reasoning is predicated on the idea that an arbitral award set aside in the
country of origin ceases to exist legally and cannot be resurrected during
enforcement proceedings abroad. This interpretation is based on the
understanding that arbitration is essentially an extension of the legal regime
of the jurisdiction in which the arbitration takes place and judicial oversight of
the arbitration process is conclusive. Supporters of this position also argue
that since parties to the arbitration have purposefully chosen to arbitrate in a
particular jurisdiction, they should expect and accept the risk of a set-aside
under the rules of the seat.
This view is problematic for several reasons. An absolute deference to the
annulment of arbitral awards at the seat can have far-reaching implications due
to the unlimited extraterritorial effect accorded to the local annulment judgments.
From a policy perspective, such a position will be difficult to reconcile with the
goal of international arbitration to provide a forum and framework for a
neutral transnational dispute adjudication. Only such a neutral forum can fulfill
the parties’ intent to move away from national courts and the local favoritism
and parochial bias often associated with them. Thus, courts in jurisdictions where
recognition and enforcement is sought should be able to exercise a certain level
of discretion when faced with an award that has been set aside at the seat.
At the opposite end of the spectrum stands the proposition that international
arbitration is completely detached from any national legal order, including that
of the seat, and forms a separate, a-national legal regime. This approach gives
little, if any, weight to award annulments at the seat. Such a treatment of set-
asides has been typically associated with French courts which have consistently
utilized the “more favorable rule principle” where Article VII of the Convention
SEARCHING FOR BALANCE IN JUDICIAL TREATMENT OF ARBITRAL AWARDS 453
takes precedence over Article V when it comes to recognition and enforcement

of foreign set-asides.
This principle emerged in the early 1980s with the Norsolor case and was
further established with the Hilmarton, Putrabali, and Chromalloy decisions.
The French position was well articulated by the Cour de cassation in Hilmarton,
which involved the recognition of two separate Swiss awards, by noting that
“the award rendered in Switzerland was an international award that was not
integrated into the legal order of that state” and that its existence continued
beyond its annulment.
This broad liberal view has also been subject to criticism. One of the
potential weaknesses is that this approach can lead to complications in cases
where more than one award has been issued and where the awards are
inconsistent with each other. Such was the case in Putrabali where after the first
award (in favor of the French party) was partially set aside, a second award
(favoring the Indonesian party) was issued. Ultimately, the Cour de cassation
held that only the first award may be enforced and that the second was precluded
by the recognition of the first. One can foresee how this approach may result
in inconsistent and self-contradicting outcomes damaging the legitimacy of the
arbitral proceedings.
III. THE JUDGMENT ROUTE: BALANCING BETWEEN COMPETING

INTERESTS
Clearly, both extremes on the interpretational spectrum pose a unique set

of problems. Thus, many arbitration experts have favored a more balanced,
intermediary approach, which provides recognizing courts with a certain level
of discretion. However, commentators’ views diverge on what analytical
framework should be applied to the problem. A natural starting point in the
analysis would be Article V of the Convention. However, the Convention does
not provide any guidance on how this provision should be interpreted and how
broad the scope of the court’s discretion should be.
A number of scholars argue that necessary guidance may be found in the
principles of private international law. Under this analytical approach, judges
should look at the law on recognition and enforcement of foreign judgments to
provide guidance as to when courts in applying Article V should refuse to
enforce or recognize an award set aside at the seat. Such an approach was
suggested by William Park who noted that annulment orders should be treated
like other foreign money judgments and shall be accorded deference “unless
procedurally unfair or contrary to fundamental notions of justice.” This approach
also appears to be favored by other scholars according to whom if the judgement
setting aside the award does not comport with the foreign judgment principles
of the forum, the award may be recognized or enforced regardless of the set-
aside.
Importantly, such is also the position of the drafters of the Restatement of

the US Law of International Commercial and Investor-State Arbitration (the
“Restatement”). On the issue of recognition of foreign set-asides, Section 4.14(b)
of the Restatement provides that if an award has been set aside, a U.S. court
may recognize or enforce such an award “if the judgment setting it aside is not
entitled to recognition under the principles governing the recognition of
judgments” in the court where such relief is sought. In other words, according
to the Restatement, a U.S. court will have to determine whether the foreign set
aside judgment complies with the requirements for recognition and enforcement
of foreign judgments in the forum, including whether it has been rendered in
accordance with fair proceedings and whether it runs counter to U.S. public
policy considerations. If compliance is lacking or is insufficient, the foreign set
aside judgment will not be entitled to recognition and the court may in its
discretion confirm, recognize, or enforce the award. This is, without a doubt, a
clear statement of the principles governing the judgment route. As provided in
the Reporters’ Notes to that section, “the Restatement view focuses on the
foreign judgment of set-aside, testing it against the law of judgments of the
court where recognition or enforcement is sought,” a view consistent with the
position taken by some federal courts of appeal. However, the Restatement
acknowledges that U.S. courts are yet to properly address the various
circumstances that may justify the confirmation or recognition and enforcement
of an award that has been set aside.
Courts in jurisdictions such as the U.S., the U.K., and the Netherlands, have
favored judgment recognition principles when dealing with set-asides rendered
at the seat. This appears to be the most flexible approach as it does not deal in
absolutes, but rather provides a working compromise between comity
considerations, one the one hand, and judicial discretion of the enforcing courts,
on the other. Importantly, it is also the only approach that stays true to the
spirit of the New York Convention. As such, it clearly advances the goals of
international arbitration without unnecessarily prejudicing any significant
pro-arbitration values or considerations.
However, even this approach is not without its imperfections. One concern
has to do with the unavoidable application of public policy considerations. For
example, Dutch public policy may not necessarily be the same as English public
policy even on issues such as a court’s impartiality and independence. Such
differences could potentially lead to situations where a set-aside judgment is
given recognition in one jurisdiction but is not necessarily recognized in another.
Another issue that varies from one jurisdiction to another is the level of
discretion under Article V(1)(e) of the Convention utilized by the courts. Some
U.S. courts may consider that discretion should be narrowly applied, available
only where the set-aside judgment was so offensive as to be “repugnant to
fundamental notions of what is decent and just” as did the court in Pemex.
Although similar in scope, the level of discretion employed by English or European
courts could be calibrated differently and be more reliant on public policy
SEARCHING FOR BALANCE IN JUDICIAL TREATMENT OF ARBITRAL AWARDS 455
concerns depending on the jurisdiction. Clearly, even the judgment route

approach is not immune to certain inherent tension between competing interests
and values.
In this context, one way to promote international arbitration’s best interests
is to seek policies and practices grounded in enhanced predictability and
consistency. One suggestion in that direction, as advocated by some
commentators, is that set-aside judgments should not be recognized if they are
based on grounds other than those enumerated in Article V(1)(a)–(d) of the
Convention or on substantive review of the merits of the award. This
suggestion effectively advocates that recognizing courts should adhere more
closely to the text and tenets of the Convention. Importantly, this will also
provide a more objective, universal approach which together with the traditional
foreign judgment principles will likely reduce the perceived lack of uniformity
identified by certain courts and legal scholars.
IV. CONCLUSION
The fate of arbitral awards set aside at the seat is an important consideration
when evaluating whether a certain jurisdiction has an arbitration friendly
regime. As discussed, the views favoring the two extremes on the interpretational
spectrum are predicated on shaky theoretical grounds, which necessarily lead
to problematic results. The judgment route alternative, as articulated in the
Restatement, clearly provides the most sensible and workable approach,
balancing between competing considerations of comity and judicial discretion.
It is the most arbitration friendly approach that is well suited to sufficiently
advance central goals of international arbitration such as fairness and
enforceability of the arbitral awards. Yet, even the judgment route approach
has its theoretical imperfections as it tends to be heavily dependent on public
policy considerations, which may differ depending on the jurisdiction, and may
result in diverging, inconsistent outcomes. Therefore, the proposed solution is
to refine the judgment route approach by including additional considerations
in the analysis performed by recognizing courts. These additional elements
focus primarily on the recognition principles articulated in the New York
Convention. As such, their application will further enhance the fundamental
values of international arbitration and ultimately arbitration’s legitimacy as a
form of dispute resolution.
Chapter 81
IS REMOTE ARBITRATION PRO-ARBITRATION?
Paris Aboro*
In his article, What Does it Mean to Be “Pro-Arbitration”?, Professor Bermann

highlighted the complexity in answering this seemingly simple question. By
asking the international arbitration community to consider more closely what
it really means to be “pro-arbitration,” Professor Bermann forces us all to think
critically about a question, the answer to which we might otherwise have taken
for granted—a prompt with which I became quite familiar during my time as
Professor Bermann’s student.
Professor Bermann surveyed a number of different arbitration-related
measures in the course of his article, as he examined the circumstances in which
pro-arbitration considerations may come into conflict with one another, or
with considerations of broader social value. Re-reading Professor Bermann’s
article, it is interesting to reflect on those measures that he was not able to
address and, in particular, on issues that have come into greater focus in the
years since he wrote his article.
Written in 2018, Professor Bermann’s article pre-dates the onset of the global
COVID-19 pandemic, for example. With the introduction of travel restrictions,
lockdowns, and social distancing, the pandemic brought with it significant shifts
in the way in which we practice law, to say nothing of its broader consequences.
A notable—if expected, and arguably long-overdue—development in the
dispute resolution context has been the rise of remote hearings and the related
increase in the use of technology. Of course, remote arbitration hearings have
long existed and their surging prominence is not solely attributable to the
restrictions imposed as a result of the pandemic. Nevertheless, there is little
question that the pandemic prompted significant growth in the number of
merits hearings, in particular, that were conducted on a remote or hybrid basis.
With little other choice, clients, counsel, and arbitrators alike, were forced
quickly to become comfortable with the idea of conducting an arbitration in a
wholly remote manner.
This development prompted a number of arbitral institutions, including
the International Chamber of Commerce (ICC), to clarify the application of their
arbitral rules to remote procedures. Institutions quickly adopted new video
conferencing software to facilitate remote hearings. Further, in light of the
relationship between procedural developments such as this and the lex arbitri,
* Paris Aboro is an Associate at Covington & Burling LLP in New York. Any views expressed
in this publication are strictly those of the author and do not necessarily represent positions or
opinions of Covington & Burling LLP or its clients.
457
the International Council for Commercial Arbitration (ICCA) launched a survey

of more than 75 jurisdictions in an effort to determine whether the right to a
physical hearing exists in international arbitration.
Unsurprisingly, therefore, in the last two years, much has been written
about the advantages and disadvantages of remote arbitration proceedings—
a development that will no doubt continue. To date, this debate has often
involved indirect consideration of Professor Bermann’s twelve criteria for
measuring the pro-arbitration character of a given policy or practice. But,
heeding Professor Bermann’s call to think more critically about what it means
for a measure to be pro-arbitration, it is interesting to directly consider
whether the encouragement of wholly remote arbitration proceedings should,
in general terms, be properly viewed as “arbitration friendly” or not.
For present purposes, I will focus specifically on considerations of particular
relevance to remote hearings on issues of substance as opposed to procedure;
for example, merits hearings, that may involve witness and expert testimony.
I. IS REMOTE ARBITRATION PRO-ARBITRATION?
A. Time and Cost Efficiency Support the Conclusion that Remote

Arbitration Should Be Considered Pro-Arbitration
As a starting point, the principal advantage of remote arbitration is that it

will be almost invariably more cost efficient than an in-person hearing. It can
be incredibly expensive to bring the parties to an arbitration, along with their
counsel, witnesses, and the tribunal, together in one place. To do so may
involve hefty flight and hotel costs, in addition to any costs associated with the
location of the arbitration hearing itself and other logistical needs. Most, if not
all, of these costs can be avoided through the use of a remote procedure. Even
a procedure that is not fully remote—for example, where only certain participants
appear remotely—can significantly reduce the costs incurred.
Remote arbitration may also be more time efficient than an in-person
hearing, though this will not always be the case. It may be easier to schedule a
remote hearing quickly, for example. The use of a remote format may also
encourage a more focused proceeding. Remote hearings also afford a degree
of flexibility to the parties, including in respect of the day-to-day schedule,
which can be a benefit.
Given that arbitration is intended to provide parties with a more time and
cost effective alternative to resolve their disputes than traditional litigation,
the increased efficiency offered by remote arbitration is a factor that weighs
significantly in favor of its pro-arbitration character.
B. Do Due Process and Other Concerns Alter this Conclusion?
On the other hand, however, there are potential disadvantages to remote

arbitration that weigh against its arbitration friendliness. Here, there are at
IS REMOTE ARBITRATION PRO-ARBITRATION? 459
least three related considerations that bear particular emphasis—each of which

are frequently raised when the topic of remote arbitration is discussed.
First, the rise of remote hearings appears to have brought with it an
increased tendency towards challenges on due process grounds. Parties may,
for example, argue they have been deprived of an adequate opportunity to
present their case. While such an argument may take a variety of forms, one
interesting example might be based on an alleged inequality of arms associated
with technological disparities between the parties. Indeed, this issue was
raised early in the pandemic at the 32nd Annual Workshop of the Institute for
Transnational Arbitration. There, it was noted that assumptions regarding the
equal availability of the necessary technology or the capability of both parties
to run a fully remote hearing may not always be accurate, and could present
issues if raised too late in the arbitral process (or even subsequent to an award).
The risk of a due process challenge would, of course, be increased in the
event that the original decision to proceed by way of a fully remote procedure
was not party-led. In this respect, there is increasing discussion among
commentators regarding the question of whether a tribunal may—or should—
proceed with a remote procedure over the objections of one party, or contrary
to the express agreement of the parties. This particular question raises
interesting issues related to the lex arbitri and applicable procedural rules,
with the answer appearing to vary between jurisdictions. Indeed, ICCA’s cross-
jurisdictional survey has demonstrated a number of trends and divergences
among countries on the issue of whether or not there exists a right to a physical
hearing. It appears, for example, that there are a small number of jurisdictions
in which the right to a physical hearing may be inferred, and others—including
Benin, Norway, and Tunisia—where this question remains unsettled.
Second, and relatedly, questions may arise regarding the efficacy of witness
testimony given during a remote procedure. Clearly, it is harder to effectively
examine witnesses virtually, rather than in-person. This complexity is further
increased where the witness does not speak the same language as the examiner,
thus requiring translation. The tangible and intangible distance that remote
testimony creates between the witness, the examiner, and the tribunal is
undoubtedly difficult to navigate. In my experience, this is the primary reason
why there appears to be a lasting preference for in-person hearings among
many arbitration practitioners, even those that have participated in well-
administered remote proceedings.
Third, a remote proceeding, and remote testimony in particular, are
arguably more open to abuse. This abuse may be both internal to the arbitration
and external. Internally, where remote witness examination is required, questions
may arise regarding possible improper contact with the testifying witness. It
is difficult to ensure, for example, that a witness is not able to see their phone,
or to otherwise receive communications during their testimony. Externally,
there are necessarily additional security considerations to take into account
when any hearing is held remotely to safeguard the integrity and confidentiality
of the proceedings.
These potential disadvantages cut across a range of Professor Bermann’s
twelve criteria for determining the pro-arbitration character of a given measure.
Any one of these factors would seem to weigh in favor of the conclusion that
remote arbitration, may in fact be “anti-arbitration.” In this respect, the pursuit
of time and cost efficiency, may operate at cross-purposes to the likely intentions
or expectations of the parties, a party’s right to be heard, and relatedly may
pose a risk to an award’s enforceability.
C. The Balance Tips in Favor of Remote Arbitration’s Pro-Arbitration

Character
Remote arbitration therefore appears to fall squarely within the category

of measures that present, what Professor Bermann described as, a “classic
confrontation between pro-arbitration values.”
In these circumstances, applying Professor Bermann’s suggested analysis,
it is necessary to weigh how far the rise of remote arbitration either serves or
disserves arbitration’s interests. This balancing exercise—applied to assess
the pro-arbitration character of remote arbitration—necessarily closely
mirrors the exercise in discretion required of arbitrators when determining
whether or not to proceed by way of a remote procedure. With this in mind, it
must be recognized that the balance may shift in individual cases.
Nevertheless, in my view, it is in the application of such a balancing
exercise, that remote arbitration’s pro-arbitration character as a measure
comes sharply into focus. More often than not, it is likely that the value gained
in terms of time and cost efficiency will substantially outweigh the potential
risks to the arbitral process.
Certainly, the mere fact that a merits hearing proceeds remotely, as
opposed to in-person, should not, in and of itself, give rise to a reasonable due
process challenge, subject of course to questions associated with party agreement.
To date, I am not aware of any successful due process challenge on the ground
that a merits hearing was held remotely rather than in-person. Indeed, in most
cases, I would suggest that many of the disadvantages described above are
likely to be more theoretical than real.
For this reason, a properly administered remote arbitration must be said
to be arbitration-friendly. It is, however, necessary for both parties and tribunals
to keep in mind the advantages and disadvantages described above, and to
appropriately formulate any remote procedure so as to minimize, if not eliminate,
the risks associated with a remote format. The ever-growing number of
arbitral institutions providing guidance and clarifying the application of their
rules in a remote format, should serve to further ensure that remote procedures
are used to their greatest effect.
IS REMOTE ARBITRATION PRO-ARBITRATION? 461
II. EXTRINSIC CONSIDERATIONS SUPPORT THE PRO-ARBITRATION

CHARACTER OF REMOTE ARBITRATION
This balancing exercise is, however, not the end of any determination as to
a given measure’s arbitration friendliness. As Professor Bermann explained, there
may be factors extrinsic to the arbitral process, but of broad social value or
utility, that are relevant to any final determination on the subject. Here again,
the availability of recourse of remote arbitration provides an interesting case
study. In particular, there is an important environmental benefit that comes
with the increasing embrace of remote arbitration procedures—namely, a
reduction in the carbon footprint associated with international arbitration in
its broadest sense. In this respect, it is not surprising that The Campaign for
Greener Arbitrations includes within its “Green Pledge” the encouragement of
the use of video conferencing facilities as an alternative to travel.
Given we find ourselves at a crucial inflection point in the global climate
crisis, the old model of flying huge teams all around the world to attend
hearings in-person must not continue unchecked. The international nature of
international arbitral practice necessarily means that global travel cannot be
eliminated entirely, but any technological or procedural advance that
encourages a reduction in such travel—and thus the impact of arbitration upon
the environment—must be welcomed. In this regard, increased acceptance of
remote arbitration undoubtedly serves to enhance the legitimacy of international
arbitration as well as its standing as a means of dispute resolution, both in the
present and for the future.
* * *
It has been my long-held view that remote arbitration is ultimately a
positive development for arbitral practice. But, as was the case during my time
at Columbia, Professor Bermann has encouraged me to consider fully the reasons
underlying my opinion, and to justify my conclusion. By urging the arbitration
community to think deeply about the issues that affect arbitral practice,
Professor Bermann makes us all better lawyers and advances the field to which
we have dedicated our careers.
Chapter 82
PRO-ARBITRATION IS REGULATION
Parvan P. Parvanov*
“You need to write simple. It does not matter how complex the topic. If you
want, take a look at my latest article to get a feel.” These were George Bermann’s
instructions to me when I was stepping in as his Senior Researcher on the
Restatement of the U.S. Law (III) of International Commercial and Investor-
State Arbitration.
Upon reading the suggested article, I figured that Prof. Bermann had first
split into atomic particles and then reconciled fifty years of winding U.S. federal
courts jurisprudence on the question of “arbitrability” (in the U.S. meaning of
the term). Then, with an equally remarkable ease, Prof. Bermann had proceeded
to provide a normative systematization of the intricacies of the distribution of
jurisdictional mandates between courts and arbitration tribunals.
At first glance, what is “pro-arbitration,” rolls easy on the tongue, but its
ostensible simplicity, could in the right hands uncover layers of complexity. As
Prof. Bermann posits in his article “I first explore the wide range of meanings
that the single hyphenated term ‘pro-arbitration’, having a distinctly facile ring
to it, is meant to convey. This inquiry is very much a definitional one, albeit one
that yields a multiplicity of definitions.”
As a lawyer who relies exclusively on the international arbitration system
to get justice for my clients, I have good reasons to take the invitation of the
“pro-arbitration’s” definitional malleability, to approach the question in an
unreservedly pragmatic fashion. I think that “pro-arbitration” should be seen
as a necessary set of measures that must be adopted and implemented by the
institutional administrators at the ICC, LCIA, PCA, ICSID, ICDR, SCC, etc., and
the arbitrators appointed under the auspices of these institutions, to repair the
compromised value proposition of international arbitration.
While even in its honeymoon days of the proverbial Rolls Royce justice,
provided by select few elite arbitrators (like Prof. Bermann), the system was
hardly perfect, the expansion of international arbitration to areas historically
reserved for municipal courts, commercial arbitration’s commoditization, and
the Cambrian explosion of investment arbitration in the past 20 years, have
brought to the foray a multitude of systemic problems including corruption,
conflicts, lack of independence, and partisanship.
* Parvan P. Parvanov (J.D. ’11, LL.M. ’09) is the Founder and the Head of the International
Arbitration Chambers New York (iachambers.com) – a practice dedicated exclusively to international

arbitration.
463
With the pressures on the system resulting from the effective assumption
of governance over global commerce and the nearly exclusive duty to police
the protection of foreign investments from wayward government action,
international arbitration is increasingly failing to deliver on the very promises
that launched it into prominence. Like Carrie Bradshaw famously quipped “[i]n
New York you’re always looking for a job, a boyfriend or an apartment. You
can’t have all three at the same time.” In international arbitration getting all three
(speed, cost, and justice) at the same has always been somewhat of a wishful
thinking, but the trend today seems to be skewing in a direction where parties,
particularly those in a financially inferior position, are not being able to get a
fair adjudication on their claims, regardless of the price and the time the
arbitration takes.
In order to avoid further compromising of the very value proposition that
is the raison d’être of international arbitration “pro-arbitration,” in my view, is
to adopt arbitral regulation that will help to alleviate the described problems
and help international arbitration to regain its footing.
Where municipal systems seek to tackle the same problems through
detailed procedural guarantees, rights to appeal, and the use of the broad
powers to compel of courts of general jurisdiction, international arbitration is
inherently limited in its access to these corrective tools.
In this regard, while the limitations of consent are inherently difficult to
overcome (beyond the sophisticated use of tailored arbitration agreements
complementing the arbitral jurisdiction and powers with those of the
supervisory courts at the seat) and the lack of appellate redress, which falls in
the powers of the individual states’ legislatures to change, procedural guarantees
are very much within the powers and the will of the governing bodies of the
arbitration institutions to adopt and develop.
In this respect, I would suggest the following measures which I believe
could have a favorable “pro-arbitration” effect.
A. For institutional administrators:
• Adopt express procedural guarantees allowing the clearing of frivolous

claims and defenses through summary proceedings and early dismissal
applications;
• Adopt detailed professional rules for the conduct of counsel and have
those incorporated into the institutional arbitration rules so that
arbitrators can enforce them directly during the proceedings;
• Create ethics committees attached to the arbitration institution and
encourage arbitrators to refer the conduct of counsel, when appropriate,
for examination by these ethics committees.
• Enable the ability of participants in the process to provide publicly
available feedback about arbitrators’ performance on multiple criteria
PRO-ARBITRATION IS REGULATION 465
and allow institutionally moderated commentary about the qualities of

arbitrators and their performance.
B. In the absence of the suggested regulations and measures or until such

are adopted more broadly, arbitrators can be “pro-arbitration” if they
use their inherent discretion to decide the procedure to:
• Clear out frivolous claims and defenses with summary and early dismissal
motions, even if those are not specifically provided for under the applicable
rules.
• Not ignore counsel’s unethical pleading practices or other behavior that
has the potential to distort the quality of the record and the fact-finding
mission of the tribunal.
• Provide early warnings and enforce effectively unethical practices of
counsel to the extent possible. Postponing everything for the cost award
is not a sufficient guarantee. Maybe the losing party lost because the other
side was allowed to play fast and loose with the authorities and the
evidence.
Chapter 83
WHAT DOES IT MEAN TO BE “PRO-ISDS”?
Perry S. Bechky*
Professor Bermann left investor-state dispute settlement (ISDS) out of his

interesting discussion in “What Does it Mean to Be ‘Pro-Arbitration’?,” calling
it too politicized. Perhaps lacking the prudence of my professor, I’ll try to grab
the hot potato and take his argument to ISDS. In fact, his conclusion that
“acknowledging legitimacy—measured in terms of extrinsic values—as in
itself a pro-arbitration attribute may be among the most arbitration-friendly
moves one can make” applies with special force to ISDS. And, “[t]he present
time … is an especially apt moment” to make this ISDS-friendly move.
I. WHAT “PRO-ISDS” DOES NOT MEAN
Let us start by clearing out what it does not mean to be pro-ISDS. First, it
does not mean being pro-dispute. To be sure, the marked growth in caseload
this century has made ISDS the industry it is today. But one need not wish to see
disputes to support ISDS—any more than building a commercial, constitutional,
or criminal court reveals support for those kinds of cases. Disputes are a fact
of life and it makes sense to build sound dispute resolution systems.
Second, being pro-ISDS does not mean being for any particular rules.
Investment treaties have changed remarkably since 1959, adding both investor
rights and state defenses among numerous other provisions. They continue to
change. One can support ISDS while opposing, for example, indirect expropriation
or damages based on expected earnings. Similarly, one may prefer the
transparency of the International Centre for Settlement of Investment Disputes
(ICSID) or the rule on arbitrator immunity of the London Court of International
Arbitration (LCIA). Let each debate proceed on its own merits.
Finally, being pro-ISDS does not even mean being pro-arbitration. Historically,
ISDS was coextensive with investor-state arbitration. But that is changing.
Efforts to mediate investment disputes are growing. The EU is developing an
investment court, and the United Nations Commission on International Trade
Law (UNCITRAL) is considering one. All are types of ISDS. Their relative merits
should be assessed on criteria other than which is more pro-ISDS. So, for
example, compared with a new court, investment arbitration has both the
benefits and costs of pluralistic, dialogic decision-making, which may lead to
better results over time if one can tolerate greater inconsistency than a single
* Perry S. Bechky is a Partner at Berliner Corcoran & Rowe LLP and a Visiting Scholar at
Seattle University School of Law.

467
court is likely to produce. (Consider the greater uniformity the World Trade
Organization (WTO) Appellate Body brought to the General Agreement on
Tariffs and Trade (GATT) panel system—before it collapsed, at least in part a
victim of its own consistency.)
II. FOR DEVELOPMENT?
The World Bank—the International Bank for Reconstruction and

Development—effectively started modern ISDS. Its motive was clear, textually,
historically, and institutionally. The preamble to the ICSID Convention is
predicated on “the need for international cooperation for economic development,
and the role of private international investment therein.” Ibrahim Shihata
described ICSID as “an instrument … for the promotion of investments and of
economic development.”
The argument that ISDS is an instrument for development is intuitively
appealing. It has enough weight that promoting development should be seen
as “the object and purpose” of ISDS when construing treaties. (This argument
is made more fully in my article “Microinvestment Disputes” in Vanderbilt JTL
2012.) Yet, the empirical evidence does not show a strong connection in fact
between ISDS and development. The evidence is not strong enough in my view
to justify ISDS on this ground alone. More is needed.
III. FOR NORMALIZATION (AKA DEPOLITICIZATION)
Normally in legal disputes, the injured parties control their own cases.
They decide whether to sue, which claims to bring, who will represent them,
what arguments to make and evidence to present, and whether to settle. They
have autonomy.
International law had a different notion. Only states were “subjects”;
people and legal persons were mere “objects.” International law thus treated
injury to a national of another state as injury to the other state. That home state
owned and controlled the claim. In Barcelona Traction, the ICJ said, “The State
must be viewed as the sole judge to decide whether its protection will be
granted, to what extent it is granted, and when it will cease…. [T]he State enjoys
complete freedom of action.”
To be for ISDS is to be for normalization of investor claims, for allowing
injured investors to control their own claims. Normalization is what is meant
by “depoliticization,” removing the home state from the middle and treating
investment disputes more like other legal cases. To me, the essence of ISDS is
its “diagonal” nature, which allows an injured investor to bring a claim directly
against the host state without need to ask its home state “vertically” to espouse
a “horizontal” state-state case. (See my chapter on ICSID jurisdiction in the ICC
Business Guide to Trade and Investment, vol. 2, 2018.)
WHAT DOES IT MEAN TO BE “PRO-ISDS”? 469
To be sure, without political control, some investors will bring claims a

state would not, seek more damages, advocate more aggressive legal theories,
etc. I may not support some of these claims, theories, positions, arguments, etc.
As with domestic court, I can live with that as the price of a legal system based
on autonomy.
IV. FOR ACCOUNTABILITY
Sovereigntists oppose international legal review of state actions. For example,

as a candidate in 2016, Donald Trump complained that the Trans Pacific
Partnership (TPP) “will undermine our independence” by “creat[ing] a new
international commission that makes decisions the American people can’t
veto.” In office, his Trade Representative Robert Lighthizer said to Congress:
I am always troubled by the fact that nonelected, non-Americans can

make a decision that a United States law is invalid. Just as a matter of
principle, I find that offensive.… [P]ersonally, myself, the most troubling
part of all this is that it attacks our sovereignty.
The rhetoric of Democratic opponents of ISDS is different, but still aimed

at insulating state actions from international review. As a candidate in 2020,
Joe Biden wrote, “I oppose the ability of private corporations to attack labor,
health, and environmental policies through the [ISDS] process, and I oppose
the inclusion of such provisions in future trade agreements.” His Trade
Representative Katherine Tai added, “President Biden himself has articulated
his opposition to ISDS on the basis of the chilling effects that it has on other
countries’ policy making.”
ISDS stands for accountability. It provides a mechanism for independent
legal review of state actions. Such review is crucial to building the rule of law. To
quote Bob Dylan, “[T]he ladder of law has no top and no bottom.” Accountability
to the rule of law must reach the top.
Of course, one may achieve such accountability through domestic courts.
Both Democratic and Republican critics of ISDS have pointed to the availability
of first-rate judicial review in U.S. courts. In my view, this position ignores the sad
realities of courts in many countries. There are dysfunctional and nonfunctional
states, impoverished states with inadequately funded courts, states lacking
commitment to judicial independence and due process, states with backlogged
courts, states with corrupt courts, states with rules that discriminate against
foreigners, and states with courts that themselves commit denials of justice.
Jan Paulsson has catalogued a litany of failings of the courts of many countries,
calling for the development of “enclaves of justice” like ISDS where possible.
Courts shouldn’t be romanticized, and their failings shouldn’t be ignored.
The ladder of law must really have “no top and no bottom.” Courts must really
be “on the level.” When a court fails, “[N]ow’s the time for your tears.”
(I’m quoting The Lonesome Death of Hattie Carroll, where a court invoked
high-minded principles while sentencing a rich (and, unstated, white) man to
only six months for killing a poor (black) woman. Dylan also addresses failings,
real or fictional, of judges and juries in Hurricane and some more obscure
songs like Drifter’s Escape, Seven Curses, Percy’s Song, and The Death of Emmett
Till. The pattern of fallibility is clear. How many times must a man look up
before he can see the sky?)
Investors should not pull up the ladder of law behind them, building an
enclave of justice only for themselves. That exclusivity might perhaps be
acceptable if investors could show that ISDS makes a unique contribution to
development, but such evidence is lacking. ISDS should instead be seen as a
precedent to build more enclaves, such as more effective human rights tribunals
or tribunals that hear claims against businesses. Indeed, the business community’s
support for ISDS stands in tension with its simultaneous effort to immunize
corporations from allegations of grave abuses under the Alien Tort Statute.
Those who would get justice should give justice too. The ladder of law has no
top and no bottom.
Some critics object that ISDS works mainly for the benefit of wealthy
claimants able to afford its costs. Never mind that the same point may be made
of domestic courts. This critique seems to argue not for ending ISDS, but for
expanding and reforming it to make it more accessible to a wider array of
claimants. The ladder of law has no bottom.
ISDS may be the best accountability mechanism yet created in international
law. It should not be the last.
V. FOR LEGITIMACY
To be pro-ISDS is to support neutral, effective adjudication through a

process that is fundamentally fair to the parties and accessible to the public.
ISD tribunals must be on the level. They must serve—and at the barest minimum,
must not disserve—the “extrinsic values” identified by Professor Bermann. He
named three: “fundamental fairness,” “the public’s right to know of matters of
legitimate public interest,” and “accountability.” We can quibble about where
to draw the line between intrinsic and extrinsic. Fundamental fairness, for
example, strikes me as intrinsic to any adjudicatory process. It directly affects
at least half of the twelve intrinsic criteria identified by Professor Bermann:
effectuating the likely expectations of parties, consistency with institutional
rules, ensuring independence and impartiality of arbitrators, protecting a party’s
right to be heard, promoting accuracy, and enabling the resulting award to
withstand challenges. (I elaborate on these ideas in my recent article, “Investor-
State Arbitrators’ Duties to Non-Parties,” in Duke JCIL 2021.)
But this is a quibble. Professor Bermann is exactly right to “conclude that
if pursuing what appears to be a pro-arbitration strategy sufficiently disserves
such other values, it actually discredits arbitration and ultimately operates to
WHAT DOES IT MEAN TO BE “PRO-ISDS”? 471
arbitration’s detriment.” One need only swap out “arbitration” for “ISDS” in the
present context.
The ICSID tribunal in Hrvatska Elektroprivreda v. Slovenia nicely captured
the obligation of the tribunal to serve “as guardian of the legitimacy of the
arbitral process,” by making “every effort to ensure that the Award is soundly
based and not affected by procedural imperfection.” This is right.
By contrast, very recently, the North American Free Trade Agreement
(NAFTA) tribunal in Odyssey Marine v. Mexico disregarded this guardianship
responsibility. It rejected amicus submissions by two nongovernmental
organizations (NGO’s) on a cramped view of the NAFTA standard. It failed to
consider (as required) “the extent to which” both “there is a public interest in
the subject-matter of the arbitration” and the NGO’s bring “a perspective … that
is different from that of the disputing parties,” seeming even to imply that
NGO’s can add nothing of value when the parties have experienced counsel.
Philippe Sands dissented on grounds akin to Professor Bermann’s thesis, “It is
incumbent upon arbitrators to have regard to the need to consider the impact
on the legitimacy of the final award…. Regrettably, the Majority’s decision
indicates no awareness of these considerations….” The majority may have
thought it was serving pro-ISDS values like efficiency, but did more harm by
disserving ISDS’s legitimacy in the midst of a raging legitimacy crisis. How
many ears must one man have before he can hear people cry?
VI. CONCLUSION
Any effort to build more room for law and justice in international relations
where possible will be slow, imperfect, episodic, and opportunistic. It will not
move in a straight line.
Consider the example of the Southern African Development Community
(SADC), which created a regional tribunal with an individual right of access for
cases spanning both investment and human rights. Claims could be brought
regardless of nationality. In its first case, the SADC tribunal found that Zimbabwe
violated the rights of white farmers. Zimbabwe refused a remedy and attacked
the tribunal, persuading the other SADC countries to end individual access.
The late Archbishop Desmond Tutu defended the SADC tribunal. His
argument sounds in human rights and investment protection, and helps to show
the shared concerns between the two regimes:
[S]outhern Africa was building a house of justice, a place where ...

victims of injustice could turn with confidence. That house is now in
grave danger....
[I]ndividual access to the SADC court constitutes a key legal instrument

that has brought hope to victims of the abuse of power in SADC
countries....
Without it, the region will lose a vital ally of its citizens, its investors
and its future.
Put differently, SADC countries built a court that was on the level, then tore
it down rather than face accountability. (I discuss SADC further in
“International Adjudication of Land Disputes,” Law & Development Review
2014.) The ladder of law had reached the top in Southern Africa, but then was
pared back. I hope it will be rebuilt someday, modeling how ISDS-type
adjudication can act as a precedent for building other enclaves of justice.
Meanwhile, as ISDS faces crisis, to be pro-ISDS is to work to advance its
legitimacy. ISDS tribunals and institutions must do their jobs and do them well.
States should review ISDS, revising procedures and substantive rules as
needed to foster legitimacy. Practically speaking, given today’s crisis, I think
being pro-ISDS now requires commitment to the ongoing reform process.
Failure to improve is not an option. Supporters must admit that the waters
around ISDS have grown. It better start swimmin’ or it’ll sink like a stone.
Chapter 84
OUT OF BALANCE: HOW CALIFORNIA GETS WHO
DECIDES NON-SIGNATORY ARBITRABILITY
WRONG
Peter Fox*
I. INTRODUCTION
In his article, “What Does it Mean to Be ‘Pro-Arbitration’?”, Professor Bermann

thoroughly refutes the notion that the term, “pro-arbitration”, has a single,
static meaning. Rather, as he demonstrates, the term has many meanings; each
one as legitimate as the particular one of the many goals for international
commercial arbitration that it reflects. Moreover, as Bermann shows with
equal force, these goals—defined at a high level as accuracy, fairness, efficiency,
and enforceability—are often at odds with one another. Thus, any particular
relevant policy or practice is likely both pro- and anti-arbitration, depending
on which values guide one’s assessment.
Bermann provides several examples of policies that clearly illustrate these
tradeoffs. Policies concerning recourse to the courts for interim relief pit an
interest in the effectiveness of an award (roughly, enforceability) against interests
in efficiency as well as the parties’ pre-dispute agreement on private adjudication
(roughly, fairness). Questions concerning discovery and evidentiary standards
often require balancing competing interests in accuracy and efficiency. And the
decision about “who decides”—to paraphrase the U.S. Supreme Court opinion in
First Options of Chicago v. Kaplan—whether a non-signatory is bound by an
arbitration clause will almost certainly favor efficiency or fairness at the
expense of the other value.
An implicit corollary to Bermann’s discussion of tradeoffs is that not all
balancing leads to equipoise. While the most well-known policies at issue in
Berman’s examples all appear to involve difficult tradeoffs—e.g., express
provisions in institutional rules for parties to petition courts for interim relief;
reliance on written witness statements in place of live testimony; and a
presumption in favor of independent judicial assessment of a non-signatory’s
consent to arbitrate—there are policies that privilege one arbitral value at
such little gain relative the great costs they impose with respect to other
values, that one cannot help but consider them anti-arbitration in their totality.
* Peter Fox is a Partner at the New York City-based law firm of Scoolidge Peters Russotti &
Fox LLP, where his practice focuses on cross-border disputes and transactions. Peter was a
student of Professor Bermann in the Spring of 2007.
473
The prevailing rule in the California state courts that arbitral awards against
non-signatories without a prior judicial determination of arbitrability are per
se subject to vacatur—without any assessment of whether the parties agreed to
arbitrate the question of arbitrability, or even a de novo examination of whether
non-signatory was in fact bound—is one such example. While nominally
advancing the value of party consent that animated the Supreme Court’s decision
in First Options, the in terrorem effect of such a rule is to force all contested
non-signatory issues into the courts in the first instance, at large cost to
efficiency.
II. NON-SIGNATORIES AND FIRST OPTIONS
As Bermann mentions, questions about which forum should decide whether

a non-signatory is bound by an arbitration clause are “much debated.” The issue
is contentious because therein lies a tension between the general presumption
that arbitrators are fit to determine their own jurisdiction and arbitration’s
dependence on the parties’ consent. On the one hand, decisions about whether
a claim against a party is arbitrable appears to be a straight-forward exercise
of Kompetenz-Kompetenz, while on the other hand, if the answer to that question
is no, the objecting party has a good argument that it never should have been
made to arbitrate the gateway issue in the first place.
As Bermann notes, different jurisdictions have come down on different
sides of the issue, with the majority favoring the arbitrators over the courts. For
arbitration clauses covered by the Federal Arbitration Act, however, the U.S.
Supreme Court has ruled that—absent clear party-intent to arbitrate the issue
of non-signatory arbitrability—courts should rule “independently” on the
question. The rule flows from the 1995, First Options case referenced above. In
First Options, an arbitration claimant challenged a lower federal court’s decision
vacating an award against a non-signatory. The petitioner argued that the
arbitrator’s decision that the non-signatory was bound by the arbitration
clause should have been reviewed deferentially under the FAA, like any other
merits-based aspect of the award. The Supreme Court disagreed, and affirmed
the lower court’s de novo review of the non-signatory issue. According to the
Court, “just as the arbitrability of the merits of a dispute depends upon whether
the parties agreed to arbitrate that dispute, so the question ‘who has the primary
power to decide arbitrability’ turns upon what the parties agreed about that
matter.” This conclusion, “flow[s] inexorably from the fact that arbitration is
simply a matter of contract between the parties.” But, in determining the parties’
intent as to who should decide the arbitrability of claims against a non-signatory,
the Court cautioned that “[c]ourts should not assume that the parties agreed
to arbitrate arbitrability unless there is clear and unmistakable evidence that
they did so.” In other words, there is a presumption against reading silent or
ambiguous language as consent to arbitrate the gateway issue of arbitrability
of claims against a non-signatory. The Court justified this presumption on the
HOW CALIFORNIA GETS WHO DECIDES NON-SIGNATORY ARBITRABILITY WRONG 475
grounds that the question of “who (primarily) should decide the arbitrability
question is rather arcane. A party often might not focus upon that question or
upon the significance of having arbitrators decide the scope of their own powers”
and that a generous interpretation in favor of arbitration of these issues could
“too often force unwilling parties to arbitrate a matter they reasonably would
have thought a judge, not an arbitrator, would decide.”
Since First Options, a claimant seeking to arbitrate against a non-signatory
under an FAA-covered arbitration clause has had a choice. Assuming the non-
signatory has not itself gone to court to enjoin the arbitration, the claimant can
either: (1) at significant added expense and time, commence a proceeding in
court under the FAA to compel the non-signatory to arbitrate; or (2) proceed
directly with the arbitration over the objections of the non-signatory and, if it
wins, likely re-litigate the non-signatory issues de novo in a proceeding to confirm
or vacate the award. A rational claimant might well choose the latter option if
it believes its case for binding the non-signatory is strong. After all, if there is
evidence that the parties clearly and unmistakably intended to submit the
arbitrability question to arbitration, the arbitral award on the non-signatory
issue will receive substantial judicial deference. And, in the alternative, even if
the court is required to independently review whether the non-signatory is
bound by the arbitration agreement, it will have the award to serve as
persuasive authority. In short, while First Options limits arbitrators’ ultimate
authority to decide non-signatory issues, it by no means cuts them out of the
process.
III. BENAROYA: THE CALIFORNIA PROVISION
The situation is not the same for claimants seeking to arbitrate under
California law. In 2018, in Benaroya v. Willis, a panel of the Second District of
the California Court of Appeals reversed a lower-court decision confirming an
arbitral award against a non-signatory without analyzing whether the parties
had submitted the arbitrability of such questions to arbitration and without an
independent assessment of whether the non-signatory was, in fact, bound by
the arbitration clause.
Benaroya concerned a dispute between the actor, Bruce Willis, and a movie
producer over monies allegedly owed Willis. After commencing an arbitration
against the signatory production company, Willis sought to add the company’s
principal, Michael Benaroya, as a respondent on a theory that the company was
Benaroya’s alter ego. After taking evidence and briefing on the issue the
arbitrator determined that (1) by incorporating by reference the Judicial
Arbitration and Mediation Service rules—which vest the arbitral tribunal with
the power to determine its own jurisdiction—to the arbitration clause, the
parties had submitted non-signatory arbitrability issue to arbitration; and
(2) that the respondent company was indeed Benaroya’s alter ego and so
Mr. Benaroya was bound by the arbitration clause. Ultimately, the arbitrator
issued an award against Benaroya individually. On cross-petitions to confirm

and vacate, the trial court confirmed the award, and Mr. Benaroya appealed.
The Second District reversed in a sweeping decision that leaves no room
for arbitrators on non-signatory questions. Rather than adopt a different
interpretation of the arbitration clause than the arbitrator and lower court, the
court in Benaroya ruled that parties can never submit questions of non-signatory
arbitrability to arbitration. Referring to the incorporated JAMS Kompetenz-
Kompetenz provision, the court wrote:
[W]hile the relevant JAMS rule here permits an arbitrator to determine

whom among signatories to an arbitration agreement are proper parties
for the dispute to be arbitrated, the rule cannot (and does not) permit
the arbitrator to determine whether a nonsignatory to the arbitration
agreement can be compelled to arbitrate. The authority to decide that
question resides, by law, solely with the trial court.
The court did not attempt to parse the specific language of the JAMS rule
or review any extrinsic evidence of the parties’ intent as to arbitrability.
The Benaroya court’s refusal to recognize the parties’ capacity to submit
non-signatory questions to arbitration flies in the face of First Options—which
although non-binding, the Benaroya court later relied upon for its discussion
of waiver—and, more importantly, undermines the principle animating First
Options: “that arbitration is simply a matter of contract between the parties.”
Perhaps more troubling, however, the court in Benaroya declined to
consider whether Mr. Benaroya was, in fact, bound by the arbitration clause.
Addressing the matter through the lens of “harmless error” the court wrote:
[T]he error in permitting the arbitrator to decide whether appellant

could be compelled to arbitrate as the alter ego of Benaroya [the company]
is not subject to harmless error. Its effects are unmeasurable and defy
analysis by harmless error standards. The wrong decision-maker decided
the issue; the arbitrator exceeded his authority by purporting to compel
appellant to arbitrate and making him liable for the award as Benaroya's
alter ego. Therefore, the arbitration award must be set aside insofar as
it binds appellant.
Thus, even if, on the facts and applicable law, Mr. Benaroya was bound by
the arbitration clause, the court still vacated the award, because the “wrong
decision-maker decided the issue.”
The calculus of a claimant with a dispute against a non-signatory under a
strictly California contract is therefore quite different from that of a claimant
whose claims are controlled by First Options. Arbitrating the non-signatory
issues first is simply not an option. Even if the parties “clearly and unmistakably”
submitted these questions to arbitration, and even if the non-signatory is
HOW CALIFORNIA GETS WHO DECIDES NON-SIGNATORY ARBITRABILITY WRONG 477
obviously bound under applicable theories of alter ego, estoppel or the like,
awards against non-signatories are per se in excess of the arbitrator’s authority
under Benaroya, and therefore subject to vacatur. The claimant must go to
court to compel the non-signatory’s participation.
IV. A ONE-SIDED BALANCE
Assessing First Options and Benaroya in the context Bermann’s arbitration

values matrix, it is easy to see that First Options involves the hard tradeoffs that
Bermann found so common in policies affecting arbitration, but that Benaroya
is flat-out anti-arbitration. By allowing de novo review of non-signatory
arbitrability issues, First Options advances the value of party consent over pure
efficiency, but nevertheless allows parties to avail themselves of the
efficiencies of the arbitration process in the first instance. As discussed above,
the arbitral award—either with respect to the parties’ intent as to the arbitrability
of non-signatory issues, or of those underlying issues themselves—may be
sufficiently supported and well-reasoned as to either preempt or curtail
subsequent judicial review. The rule in Benaroya, by contrast, forces the parties
to litigate non-signatory issues in court every time, and without the benefit of
an arbitral award to guide the decision.
Moreover, by acknowledging the parties can submit the arbitrability of
non-signatory claims themselves to arbitration, First Options give full effect to
the parties’ agreement. Benaroya, on the other hand, seeks to scrupulously
vindicate a party’s lack of consent to arbitrate these issues, but in so doing, it
fails to honor those situations where the parties actually agreed to arbitrate
these gateway matters. In other words, Benaroya even fails to fully advance
the single value—party consent—that it champions.
V. FINAL THOUGHTS
At this point, one may wonder why a rule dealing with intra-state contracts,
like that of Benaroya, should matter given Bermann’s (and much of the academy’s)
focus on international commercial arbitration. The reasons are practical and
conceptual. First, as a practical matter, the court in Benaroya did not distinguish
FAA-covered contracts from purely California ones. While it cited provisions
of the California Code, and it is quite clear that the case involved local parties,
the court selectively quoted First Options, creating confusion about controlling
authority. Practitioners have cited Benaroya in California-seated international
commercial arbitrations, and the case and its progeny present real risks to any
claimant litigating the validity of an award in California state courts. With
respect to concept, Benroya’s rule is an example of how some arbitration value
tradeoffs can be so one-sided and poorly conceived as to render a policy truly
anti-arbitration. A rule that forces parties to go to court in all instances
regardless of what they have agreed to in advance fits that bill.
Chapter 85
PROFESSOR BERMANN AND THE PROSKAUER
LECTURE
Peter J. W. Sherwin*
George Bermann creates. He creates concepts, theories, and ideas—the big

stuff. He creates structures, perspectives, and ways of considering an issue, all
to enable one to grapple with the big stuff. And, of course, he creates thinkers,
both scholars and professionals, who engage with and build upon his work.
We are all beneficiaries of his efforts, and each of us has a story. Mine
started with EEC Law (yes, it was a while ago) and how those regulations and
concepts differ from our domestic system, and Transnational Litigation and
how the procedural dance is complex, beautiful, and powerful. International
arbitration was not as developed an area of practice as it is now, so that course
was not available during my era, but I found my way to that field and back into
Prof. Bermann’s strong orbit nonetheless.
Through the years, we have discussed and mulled over various issues,
including one that vexes me to this day: the level of court review of claimed
instances of arbitrators exceeding the limits of express restrictions on their
powers. I am quite pro-arbitration, but cannot accept the view of some that
international arbitration is so fragile that it cannot withstand de novo review
of whether an arbitrator actually did something that the parties expressly
stated in their arbitration agreement he could not do. But I will leave that for
another day and forum.
But possibly the most significant conversation I have had with Prof. Bermann
was on November 27, 2012, along with Josefa Sicard-Mirabal, Executive Director
of arbitration in North America for the ICC Court/SICANA and Director of
dispute resolution services for USCIB/ICC USA. He had an idea, posed as a
query. Shouldn’t we—the international arbitration community in New York—
have our own lecture series? London has one. Aren’t we as much a center of
the international arbitration world? My answer was a resounding yes, at least
that is how I recall the conversation. It was then created: the annual Proskauer
Lecture on International Arbitration, co-sponsored by Proskauer Rose, Columbia
University School of Law’s Center for International Commercial and Investment
Arbitration Law, the ICC International Court of Arbitration, and the United
States Council for International Business/ICC USA.
* Peter J. W. Sherwin (CLS ’92) is a Partner at Proskauer Rose LLP and Head of its
international arbitration practice. He is the U.S. member to the ICC International Court of
Arbitration and the chair of the ICC USA Arbitration Committee.
479
And Professor Bermann’s creation has been a wonderful success. Each

year, we bring together well over 100 people from the international arbitration
community to hear what an eminent practitioner or scholar is thinking about
at that time. It is a warm and welcoming event, where thoughts are exchanged
during comment period, often propelled by Prof. Bermann’s additions to the
discussion. And, thereafter, everyone gathers for cocktails to address the topic
further and grow the bonds between us. It has become a highlight of the year.
Our inaugural event in March 2013 featured the late David D. Caron as the
lecturer. Prof. Caron was the C. William Maxeiner Distinguished Professor of
Law at U.C. Berkeley School of Law and the incoming Dean of The Dickson Poon
School of Law at King’s College London. His lecture was “The Genetic Divide
between International Investment and Commercial Arbitration: Understanding
Seat and Autonomy,” offering theoretical suggestions for approaching this topic,
and it was so very well received.
The next year, our lecturer was Carolyn B. Lamm, partner at White & Case
and past President of the American Bar Association. Her engaging lecture was
“Fundamental Rules of Procedure: Whose Due Process Is It?,” and she offered
practical thoughts and suggestions within the scope of this often theoretical topic.
In 2015, William W. “Rusty” Park was the lecturer. Prof. Park is the R.
Gordon Butler Scholar in International Law and Professor of Law at Boston
University School of Law. As is well known, he is a prolific author and
renowned thinker. His lecture bore the title “Explaining Arbitration Law,” and
he did not disappoint. We cannot share the thesis, otherwise there will not be
anything left to discuss during conferences.
Then, in 2016, the Proskauer Lecture was given by Wendy J. Miles KC, then
Global Head of Arbitration in the London office of Boise, Schiller & Flexner and
now at Twenty Essex. Her lecture was “New Challenges for International Dispute
Resolution in an Era of Climate Change.” Since then, Wendy has spoken further
on this important topic in various publications and fora, including an ICCA
interview, and we are proud that she shared them first with us as her Proskauer
Lecture.
The next year, we were joined by the late Emmanuel Gaillard, Visiting
Professor at Yale Law School and Head of International Arbitration at Shearman
& Sterling. He gave a very thoughtful lecture entitled “International comity, lis
pendens, res judicata: Do the principles of judicial practice apply to international
arbitration.” To this day, I think back to that lecture and the elegant structure that
Emmanuel provided for this messy topic. His remarks were subsequently
published in volume 29, issue 3 of American Review of International Arbitration,
and I commend them to all.
In 2018, Sophie Nappert, arbitrator at Three Verulum Buildings and
Moderator of OGEMID, gave her Lecture entitled “Disruption Is the New Black:
Practical Thoughts on How to Keep International Arbitration on Trend.”
Sophie discussed three areas of disruption, forcing us to think about issues on
the horizon and how we will address them. Her remarks were published in
PROFESSOR BERMANN AND THE PROSKAUER LECTURE 481
volume 29, issue 4 of American Review of International Arbitration, and are

relevant to this day.
Then, in 2019, we heard from Mark Kantor, arbitrator based in
Washington, D.C., Adjunct Professor at the Georgetown University Law Center,
and Member of the World Bank Group Sanctions Board. Mark’s topic was
“Legitimacy Challenges to International Commercial Arbitration on the Horizon?,”
and everyone had to think outside of our hermetic world to the impact of our
practice more broadly.
Of course, 2020 was then a COVID-19 year, and we paused in the hope that
everyone would soon be back in their buildings and able to join us in person
for a postponed lecture. As prescient as some of the lectures have been, that
was not. So, for the first time, our annual lecture did not take place.
But we resumed in 2021 with great success, albeit in a virtual format.
Chiann Bao was the perfect choice, as she had us consider the topic of “Iura
Novit Arbiter: Truth or Fiction?,” which is now available at volume 32, issue 4
of American Review of International Arbitration. Chiann is a member of
Arbitration Chambers and Vice President of the ICC Court and was previously
Secretary General of the Hong Kong International Arbitration Center.
COVID-19 interfered yet again in 2022, as we planned to return to an in-
person lecture, but the spring arrived earlier to New York than people did to
their offices. 2023 is lined up and ready, though, with Paul Friedland of White
& Case and his lecture “The US/Germany Interstate Arbitration of the 1920s
and 1930s,” and we look forward to seeing everyone there.
Most of all, though, I look forward to seeing Prof. Bermann in person at the
Lecture, getting to hear his thoughtful and thought-provoking questions and
comments, and experiencing the next chapter of his creation.
Chapter 86
REFLECTIONS ON THE PROGRESSIVE
DEVELOPMENT OF INVESTMENT ARBITRATION
TO MEET CLIMATE CHANGE AND ESG
IMPERATIVES
Preeti Bhagnani*
I am delighted to have this opportunity to pay tribute to George Bermann.

Beyond his tremendous contributions to our field, Professor Bermann’s impact
on those who have had the privilege of being his students cannot be overstated.
As my Professor at Columbia Law School, he encouraged me to think more deeply
about the policy issues that confront stakeholders of international arbitration.
When I relocated from Singapore to New York in 2013, Professor Bermann
welcomed me into the arbitration community in the city. His tireless dedication
and leadership in our field continues to be an inspiration.
This short contribution reflects on the challenges that face investor-state
arbitration in an era of climate change and increasing environmental, social and
governance (ESG) imperatives. These buzz words dominate our news cycle,
our conference circuits, and even my rising first grader’s list of “topics to
interrogate mommy about.” They polarize and intensify heated debate about
the legitimacy of investor-state dispute settlement (ISDS).
Critics of the ISDS system argue that investment treaties and investor-state
dispute resolution threaten the freedom of states to implement the policy
measures that are critical to the global energy transition. They warn of
“regulatory chill” caused by the ability of investors to bring claims when states
adopt measures seen as crucial to the green energy transition, from the phase
out of coal-fired power plants (e.g., RWE v. Netherlands; Uniper v. Netherlands;
Westmoreland v. Canada), to moratoria on natural gas exploration (e.g., Lone
Pine v. Canada) to the revocation of operating permits and oil and gas extraction
concessions (e.g., TC Energy v. USA (II); Rockhopper v. Italy). They denounce the
perceived loss of policy space signaled by the waves of claims that states have
faced when they rolled back incentives established to encourage investment in
renewable energy generation. They condemn the lack of transparency and
exclusion of local and indigenous communities from participation in proceedings
that yield decisions with direct influence on their lives. Features that have
drawn users to international arbitration—including the freedom to select the
* Preeti Bhagnani is a Partner at White & Case LLP. The views expressed herein are personal
and do not reflect the views of the Firm. The author is grateful to colleague, Maya Priestly, for
her assistance in the preparation of this note. Email: pbhagnani@whitecase.com.
483
adjudicators, the absence of appeal on the merits, privacy, and confidentiality—

have become the focal points of criticism.
While these concerns are neither new nor unique to climate-change
related issues, they have acquired increasing significance in a world focused
on ESG and the energy transition. Meaningful analysis of these criticisms and
the potential avenues for reform is outside the scope of this short essay. I will
instead reflect on some ways in which the investor-state system is developing—
through the arbitral jurisprudence, state-led treaty reforms, and institution-
led procedural adaptations—to align with ESG priorities.
Under current jurisprudence, investors face serious risk of being denied
investment treaty protection where they fail to comply with host state domestic
laws. Tribunals increasingly decline jurisdiction or find that claims are
inadmissible where the investor engaged in bribery, corruption, fraud and
other violations of host state law in establishing or operating their investment.
This is the case not only where an investment treaty contains an explicit “legality
requirement” (many do), as arbitral tribunals have found there is an implicit
requirement for investments to accord with host state law, based on general
principles of law. These trends align with broader global efforts to eliminate
bribery and corruption, which are central to the “governance” limb of ESG.
Failing to operate with sensitivity to ESG requirements has direct implications
for investors in the pursuit of their claims. Investors have faced substantial
reduction in the quantum of damages awarded where their conduct was found
to have contributed to the losses (e.g., Copper Mesa v. Ecuador). In an arbitration
between a Canadian mining investor, Bear Creek, and the Republic of Peru
related to a silver ore project, the tribunal reduced the quantum of damages
because, among other reasons, the investor’s failure to secure the trust of local
communities and the necessary social license to operate made it impossible to
assess the project’s expected profitability. Arbitrator Professor Philippe Sands
QC concluded in a partial dissenting opinion that it was the investor’s
responsibility to secure a social license to operate, and that damages should
have been further reduced because the investor contributed to the social
unrest, including by failing to obtain a social license.
Approaches that focus on the investor’s obligations under domestic and
international law also manifest in decisions recognizing the ability of states to
pursue counterclaims against investors. States have been able to pursue
counterclaims for alleged breaches of international human rights obligations
(e.g., Urbaser v. Argentina), domestic environmental laws (Burlington Resources
v. Ecuador) and customary international law to respect the environment (Aven
and others v. Costa Rica). Counterclaims offer states another avenue for holding
investors accountable to their ESG obligations.
The arbitral case law increasingly reflects that tribunals have the tools to
shape international investment law to accommodate international climate
change laws and policies. Broad standards of treatment in investment treaties
must be interpreted in accordance with “relevant rules of international law
PROGRESSIVE DEVELOPMENT OF INVESTMENT ARBITRATION 485
applicable in the relations between the parties,” which include the rapidly
developing network of treaty, customary and soft law norms that are driving
the net-zero transition.
Amicus curiae submissions are becoming more common, and can help to
ensure that tribunals are aware of the broader interests implicated by their
decisions. The emergence of climate change and ESG issues has amplified calls
for greater transparency and broader public access to investor-state proceedings.
Arbitral institutions have responded by revising their rules to provide for
greater transparency. Under recent revisions to the ICSID Rules, ICSID will
publish final awards with the consent of the parties. Absent such consent,
ICSID will publish redacted excerpts of awards and annulment decisions.
Written submissions and other documents filed in the proceedings will be
published if the parties consent. Hearings, similarly, are no longer presumptively
private. Absent party objection, non-parties unrelated to the proceedings may
observe hearings. While the scope of public access to ISDS proceedings under
the revised ICSID rules is thus firmly guided by the agreement of the parties,
these are positive steps towards increasing the transparency of investor-state
dispute resolution.
Looking ahead, new investment treaties and model investment treaties
will play an important role in aligning investment obligations with climate change
and ESG priorities. New treaties increasingly refer to international environmental
agreements, expressly preserve the host State’s right to regulate in environmental
matters, and impose obligations on investors related to environmental due
diligence and corporate governance. The integration of ESG considerations
into trade and investment policies presents further opportunities to encourage
the types of investment that will contribute to sustainable development and
responsible business conduct.
As climate change law and ESG regulations continue to evolve, open-
minded dialogue across a range of participants is needed to ensure that the
investment treaty system delivers what is needed for all stakeholders. The
developments discussed in this note are not a panacea for all shortcomings of
ISDS. Stakeholders must contend with deeper questions about whether party-
appointed arbitrators have sufficient accountability and legitimacy to resolve
disputes that have broader public policy ramifications. But these developments,
incremental as they are, reflect the adaptability of ISDS and its capacity for
progressive development, features that should properly inform the broader
discussion of ISDS reforms in an ESG era.
Chapter 87
PRO-ARBITRATION? A QUESTION OF “LEGALITY,”
“EFFECTIVENESS” AND “LEGITIMACY”
Quentin Declève*
I had the pleasure of meeting Professor Bermann in 2015 during my LL.M

at Columbia Law School. During that time, I worked with him and other LL.M
students on a research project relating to the Gazprom judgment (C-536/13 –
EU:C:2015:316), where the Court of Justice of the European Union (CJUE)
recognized that an arbitral tribunal could issue an anti-suit injunction against
a party that had initiated judicial proceedings in the European Union in breach
of an arbitration agreement. That project was particularly enlightening as I
could combine my experience and knowledge of both arbitration and EU law.
As a token of appreciation for this experience, this short contribution is
aimed at illustrating the concept of “pro-arbitration” by combining EU law with
some personal reflections stemming from legal philosophy and legal theory. In
particular, I argue that examining whether a legal order (in particular the EU
legal order) is “pro” or “anti-arbitration” requires an assessment resembling the
one that could be used to assess the validity of legal rules.
I. THEORY OF VALIDITY OF RULES
The work of legal philosophers like Hans Kelsen, H.L.A Hart or

Ronald Dworkin has shown that the validity of a given legal rule depends on
three key dimensions, namely:
• A rule must be properly enacted by an appropriate and legitimate body

(such as a parliament or regulator) and it must comply with fundamental
legal requirements and principles of law (such as the principle of non-
retroactivity). This is called the “legal” dimension.
• A rule must also be properly enforced by judicial and law enforcement
authorities. This is the “social” or “effectiveness” dimension.
• The rule must be seen as morally justified by its recipient and it must
comply with the moral values in the society in which it is enacted. This
third dimension is the “legitimacy” dimension.
Those three dimensions can be represented by three overlapping and

intertwined circles. The more those circles overlap, the stronger a rule is.
* Quentin Declève is a Senior Associate at Van Bael & Bellis (Brussels) and Columbia Law
School LL.M student 2015–2016.

487
Conversely, the validity of a rule is weaker if the rule is arbitrarily imposed on

a population without adoption in accordance with the appropriate standards
and procedures (meaning that the law lacks the “legal” dimension) or if it is
ultimately overruled by a supreme court or a constitutional court, or if it is not
enforced or applied by the courts (meaning that the rule lacks the “social/
effectiveness” dimension), or if a law fails to be accepted by its recipients
(meaning that it lacks the “legitimacy” dimension).
II. ASSESSING “PRO-ARBITRATION” IN LIGHT OF THE THREE

DIMENSIONS
To a certain extent, examining whether a given legal order is “pro-” or

“anti-arbitration” invites a similar assessment.
In this short contribution, I take the view that a legal system is “pro-
arbitration” if, first of all, this legal system has adopted clear and consistent
laws and regulations—such as the UNICTRAL Model Law or the New York
Convention on the Recognition and Enforcement of Foreign Arbitral Awards
(the New York Convention)—which are favorable to arbitration and which
render the arbitral process smooth and efficient. This could be referred to as
the “legal dimension of arbitration.”
However, enacting laws and regulations which are favorable to arbitration
is not enough for a legal system to be regarded as “pro-arbitration.” In addition,
courts must grant appropriate support to arbitral tribunals and they must only
set aside or refuse the recognition or enforcement of arbitral awards on
predictable grounds and for legitimate reasons. This could be referred to as the
“social/effectiveness dimension of arbitration.”
Finally, a pro-arbitration legal system is a system where arbitration is also
seen as a legitimate and an appropriate method of conflict resolution and
A QUESTION OF “LEGALITY,” “EFFECTIVENESS” AND “LEGITIMACY” 489
where arbitration is welcomed by legal practitioners (including lawyers and

judges) and society at large, in particular by the business community (the
“legitimacy dimension of arbitration”).
As is the case with respect to the validity of legal rules, assessing the degree
of openness of a given legal regime towards arbitration requires an analysis of
the interaction between these three dimensions. On the basis of this analytic
tool, I discuss, in the following sections, the European Union’s contrasting
approach to arbitration. On the one hand, the European Union, including its
Member States, can certainly be seen as a pro-arbitration system when it
comes to how international commercial arbitration is perceived in the European
Union (section III). However, the conclusion is radically different regarding the
openness towards investment arbitration (section IV).
Before conducting these assessments, however, it is important to emphasize
that the European Union comprises 27 jurisdictions and that there is no such
thing as a single set of “EU arbitration law.” Instead, my analysis will require a
subtle assessment of initiatives taken by the European Union (and its courts)
on the one hand, and initiatives taken by EU Member States on the other.
III. EU LAW AND COMMERCIAL ARBITRATION AS AN EXAMPLE OF A

“PRO-ARBITRATION” REGIME
EU law does not regulate commercial arbitration law. Instead, from a

“legal” dimension perspective, regulation of arbitration in the EU is left to
Member States, who, in turn, adopt their own arbitration laws. That being said,
all EU Member States are parties to the New York Convention and most of the
EU Member States have enacted legislation based on the UNCITRAL Model
Law. In addition, it is noteworthy that EU Member States tend to adopt a rather
broad understanding of the concept of “arbitrability.” Therefore, although the
influence of EU law is somehow limited (the Brussels Ibis Regulation even
contains an express exclusion of arbitration from its scope in order not to
conflict with the New York Convention), EU Member States tend to adopt laws
and regulations that are rather friendly to arbitration.
The influence of EU law on commercial arbitration is considerably more
noticeable when it comes to assessing the “legitimacy dimension of arbitration”
and, more specifically, the caselaw of the CJEU. Whilst the CJEU had shown a
certain openness towards commercial arbitration (for instance, in the Gazprom
case referred to above, the CJEU has allowed arbitral tribunals to issue anti-
suit injunctions when a party to a dispute initiated judicial proceedings in breach
of an arbitration agreement), the CJEU had also set some clear boundaries in
order to make commercial arbitration more predictable and efficient in the EU.
For instance, in its landmark Eco-Swiss case (C-126/97 – EU:C:1999:269), the
CJEU clearly ruled that EU law prohibiting anti-competitive agreements may
be considered a matter of public policy under the New York Convention. This
position has recently been recalled once again in a judgment delivered on
2 February 2022 (T-616/18 – EU:T:2022:43). Similarly, whilst EU Directive

93/13 on Unfair Terms in Consumer Contract presumes arbitration clauses in
consumer contracts to be invalid (Article 3.3 and its Annex, para 1.q), the CJEU
has clearly ruled in Mostaza Claro (C-168/05 – EU:C:2006:675) that this provision
was part of EU public policy and that when EU national courts were asked to
adjudicate on a request for the annulment of an arbitration award, they were
required to assess on their own motion whether that award had been
delivered in violation of this provision of EU Directive 93/13.
Finally, from its “legitimacy” dimension, commercial arbitration in the
European Union appears to be seen as a widely accepted means of dispute
resolution by lawyers, judges, business community.
In light of this assessment of the three dimensions of commercial arbitration,
I consider that the European Union and its Member States overall appear to be
rather “pro-arbitration” fora.
IV. EU LAW AND INVESTMENT ARBITRATION AS AN EXAMPLE OF

“ANTI-ARBITRATION” SYSTEM
Whilst the European Union and its Member States can certainly be
considered as “pro-commercial arbitration,” this is not the case with respect to
investment arbitration, especially investment arbitration proceedings initiated
by an EU investor against an EU Member State (so-called intra-EU investment
proceedings). This marginalization of investment arbitration by the European
Union is clearly visible from all three dimensions.
The European Union’s (and that of its Member States) shift away from
investment arbitration can be explained by several factors. First, since 2008
and the entry into force of the Lisbon Treaty, the European Union has enjoyed
exclusive competence with respect to foreign direct investment policy. Therefore,
the adoption of this treaty gave the European Union leverage to steer its own FDI
agenda into new waters (although the competence to deal with ISDS remains
a shared competence (see CJEU’s Opinion 2/15 – EU:C:2017:376)). At the same
time, the European Union became increasingly critical of the fact that the
Central and Eastern European States that joined the EU block after 2004 had
not terminated their respective bilateral investments treaties with existing EU
Member States (so-called intra-EU BITs) prior to their accession to the
European Union. Therefore, investors based in EU countries that still had BITs
in force with other EU Member States could rely on the ISDS clause in those
BITs to initiate intra-EU investment arbitration proceedings. Such proceedings
were clearly regarded by the EU institutions as methods of circumventing the
effectiveness of EU law.
From the “legal dimension,” various elements illustrate EU’s rejection of
investment arbitration.
First, over the last decade, the European Union and its Member States have
systematically attempted to include in their investment treaties concluded
A QUESTION OF “LEGALITY,” “EFFECTIVENESS” AND “LEGITIMACY” 491
with third countries (such as the Canada-EU Comprehensive and Economic

Trade Agreement (CETA), the EU-Singapore Investment Protection Agreement
(EUSIPA) and the EU-Vietnam Investment Protection Agreement (EUVIPA)), a
so-called Investment Court System. Under such a system, investment disputes
would be adjudicated by a specific, permanent and independent investment
tribunal (with potential recourse to an appeal tribunal) instead of the traditional
investment arbitration mechanism.
Secondly, in order to give effect to the Achmea ruling of the CJEU (C-284/16
– EU:C:2018:158), most EU Member States signed a plurilateral agreement
terminating existing intra-EU BITs in force between them. This plurilateral
agreement also prohibited the initiation of new intra-EU investment arbitration
cases. All these initiatives clearly indicate that—from a “legal” standpoint—the
European Union and its Member States turned their backs on investment
arbitration.
This trend is also clearly visible when assessing the “social”/ “effectiveness”
dimension of investment arbitration in the European Union.
The first major case where the CJEU has expressed its resentment towards
investment arbitration is the well-known Achmea judgment (C-284/16 –
EU:C:2018:158). The CJEU found that intra-EU BITs were incompatible with
EU law because they violated the principle of autonomy of the EU legal order
and jeopardized the effectiveness, primacy and direct effect of EU law, as well
as the principle of mutual trust between the EU Member States. In Komstroy
(C-741/19 – EU:C:2021:655) and PL Holdings (C-109/20 – EU:C:2021:875),
the CJEU extended that finding to the investment arbitration clause of the
Energy Charter Treaty and to ad hoc arbitration agreements with identical
content to an intra-EU investment arbitration clause, concluded between an
EU Member State and an investor from another EU Member State. In its Opinion
1/17 (EU:C:2019:341) of 30 April 2019, the CJEU further confirmed the validity,
under EU law, of the Investment Court System under CETA which further
encouraged the European Union to pursue its agenda of reforming traditional
ISDS by establishing a Multilateral Investment Court.
Finally, when assessing the “legitimacy” dimension and the manner in
which investment arbitration is currently being perceived within the European
Union, it is noteworthy that investment arbitration has never before been
under as much pressure from NGOs, political parties and social elites as it has
been in recent years (as was shown by the troublesome adoption of CETA and
the blockade by the Walloon parliament—one of Belgium’s sub-parliaments—
on proceeding with the signature of that trade agreement).
All those elements suggest that—contrary to commercial arbitration—the
European Union and its Member States offer a rather “anti-arbitration”
environment to investment arbitration.
V. CONCLUSION
The present piece argues that examining whether a legal order is “pro” or
“anti-arbitration” requires an assessment that is similar to the one that could
be used to assess the validity of legal rules. In particular, it is necessary to
assess the laws and regulations relating to arbitration that have been adopted in
that legal order (i.e., the “legal dimension of arbitration”). It is also necessary to
examine how judicial and law enforcement authorities provide stable, consistent
and clear rulings in support of arbitration (i.e., the “social/effectiveness dimension
of arbitration”) and how arbitration is welcomed by legal practitioners
(including lawyers and judges) and civil society at large (i.e., “legitimacy
dimension of arbitration”).
By assessing the European Union’s openness towards arbitration in light
of these three dimensions, it can be concluded that the European Union’s legal
order definitely offers a “pro-arbitration” environment to commercial arbitration.
This is, however, not the case with respect to investment arbitration.
Chapter 88
BEING TAUGHT TO THINK CRITICALLY ABOUT
WHAT IS GOOD FOR ARBITRATION
Quinn Leary*
When I first stepped into Professor Bermann’s classroom, I had no idea

how towering a figure he is in the international arbitration community (I had
not had much exposure to the international arbitration community yet). His
stature within the world of arbitration quickly became clear, and I jumped at
the opportunity to work with him as a research assistant. I learned much from
him and will always be grateful that my introduction to arbitration came with
the guidance of one of its real superstars.
What impressed me most about Professor Bermann, though, was neither
his celebrity nor his vast knowledge of arbitration issues, but his sincere
commitment to determining what needed to happen to advance the cause of
arbitration. He is always asking the question: what does it mean for a particular
policy or practice to be “pro-arbitration”? What goals should the system have?
I will posit a few suggestions that come to mind, all of which seem attractive at
first glance: 1) increasing the number of arbitrations happening at any given
time; 2) creating a process for the cheapest and shortest arbitrations; and
3) promoting a system with the highest rate of enforcement by the courts.
These aims all sound good at first, but Professor Bermann taught me to look
more closely. I will examine each of them in turn, attempting to parse out the
issues and explain why, for each, more analysis is necessary.
Fairness. One can imagine a scenario in which there are tens of thousands
of arbitrations going on at any given time. This is good for arbitration in and of
itself, but it is important also to consider how the nature and outcomes of these
arbitrations could impact the way arbitration is viewed. After all, having many
arbitrations could just mean that one particular group of users has determined
arbitration suits its needs well—and that could come at the expense of others.
This has sparked a debate around class arbitrations. Suppose there is a problem
with the way a product was manufactured, and many people suffered due to
this problem. But in the fine print of the consumer contract (typically, not read)
there was not only an arbitration clause but also a class arbitration waiver. So
each person, in order to seek compensation, would have to initiate an individual
arbitration against a company with greater resources. Parties might simply
* Quinn Leary holds a J.D. from Columbia Law School, where she studied with and conducted
research for Professor Bermann. She practices both investor-state and international commercial
arbitration at Skadden, Arps, Slate, Meagher & Flom LLP in New York. The views expressed
herein do not necessarily reflect the views of Skadden.
493
give up and suffer the consequences of someone else’s mistake, and some argue
that this creates unfairness. The California legislature attempted to address
that issue with a law that banned such class action waivers. But the Supreme
Court, in a widely-covered case, AT&T Mobility v. Concepción, 563 U.S. 333
(2011), held that this law was unconstitutional. In this context, Professor
Bermann has said that “consumer arbitration has put a cloud over commercial
arbitration because of critiques that apply uniquely to it” and argued that this
state of affairs is not pro-arbitration because of the potential to damage its
reputation. His approach highlights the nuance with which problems like this
must be analyzed: policymakers and courts alike must consider not just how
often arbitration is used, but also how it is used, and should take into account
the impact that has on the way that arbitration is viewed outside the legal
community.
Length and Cost. Efficiency is, without a doubt, the proverbial headline of
any advertisement for arbitration—as well it should be. This is often a key
driver for any party choosing arbitration, combined with the freedom to
customize it to be efficient in a way that works for them. But efficiency must be
balanced with the proper amount of deference to rules and procedures in
order to guarantee a process that is fair. If procedural safeguards are not
honored, losing parties could well take each and every opportunity to overturn
an arbitral award: they may seek to appeal or annul the Award, or resist
recognition and enforcement in national courts. Of course, some parties do this
no matter what. But a party which truly feels its rights have been violated is
much more likely to persist on this path (and to succeed, which often leads to
even more court battles). Thus, arbitration must balance efficiency concerns
with those of due process. This is easier said than done, of course, but it is
absolutely vital to address this or arbitration will become just as costly and
lengthy a process as adjudication in courts.
Court Enforcement. Speaking of courts, my third suggestion for how best to
gauge whether a particular policy or practice is pro-arbitration is whether or
not that policy or practice tends to increase the rate at which courts enforce
arbitration awards. (I use enforcement here to encompass confirmation,
enforcement, and execution.) Generally speaking, I think this metric is the
closest of the three to being on the mark. However, even here we have to be
careful: blindly enforcing deficient awards (or, as Professor Bermann calls it,
“putting a thumb on the scale” in favor of enforcing awards even when the law
requires taking a closer look or reviewing an issue de novo) comes with its own
set of problems. A recent decision in the Second Circuit, Beijing Shougang
Mining Inv. Co. v. Mongolia, 11 F.4th 144 (2021), has sparked a spirited debate
about this issue. In Beijing Shougang, the Second Circuit declined an invitation
to reverse the Southern District of New York’s decision not to review de novo
the arbitrability determination of an investor-state arbitral tribunal, finding
that the parties’ agreement to a procedural order under which the tribunal
would decide its own jurisdiction to hear the case prior to the merits meant
BEING TAUGHT TO THINK CRITICALLY ABOUT WHAT IS GOOD FOR ARBITRATION 495
that the parties had intended the tribunal, not a court, to have primary
jurisdiction over arbitrability. Professor Bermann argues in his amicus brief
in support of certiorari that this decision is antithetical to the holding of the
seminal case First Options of Chicago v. Kaplan, 514 U.S. 938 (1995). First
Options held that, absent clear and unmistakable evidence that the parties
agreed otherwise, courts have primary authority to determine the arbitrability
of a dispute (and thus, absent this “clear and unmistakable” delegation, courts
should review a tribunal’s determination about its own competence to hear
the case de novo). Professor Bermann argues that the Second Circuit’s decision
in Beijing Shougang, by misunderstanding the “clear and unmistakable
delegation” requirement, diverges from First Options and renders the law on this
issue unclear. However the case lands, Professor Bermann’s argument highlights
a crucial refinement to the analysis of what is and is not pro-arbitration. Although
courts may think that a high degree of deference to arbitral awards is always,
by definition, “pro-arbitration,” they must be wary to ensure that their
decisions correctly and consistently apply the law—to do otherwise could
damage the field of arbitration by undermining predictability in the system.
It is this type of nuanced analysis that Professor Bermann teaches and
practices. We would all do well to adopt his method of approaching issues that
affect arbitration, his unfailing mission to ensure that the outcomes reached
and the choices made lead to arbitration outcomes that are fair, efficient, and
consistent. When those goals are advanced, everyone benefits: parties,
practitioners, and the average person alike. That method—that mindset—is
the ultimate pro-arbitration tool.
Chapter 89
PRO-ARBITRATION OR NOT:
THE ATTORNEY-EYES-ONLY MECHANISM
Rachel Ong*
I. INTRODUCTION
Professor Bermann’s article titled “What Does it Mean to Be ‘Pro-Arbitration’?”

is a very welcome and provocative piece on what counts as pro-arbitration. He
explores the extent to which pursuing a pro-arbitration path, in one sense of
the term, may operate at cross-purposes with what may legitimately be
considered as pro-arbitration in one or more senses of the term so that trade-
offs become inevitable. In this piece, I discuss my reflections on whether an
Attorney-Eyes-Only order is pro-arbitration and consider the competing
considerations at play and the necessary trade-offs.
To determine whether a practice is pro-arbitration, Professor Bermann
helpfully draws on Professor Park’s non-exhaustive list of 12 criteria by which
a practice or policy’s pro or anti-arbitration character is measured. A closer
look at the 12 criteria reveals that half of them are concerned with the process of
arbitration. This is unsurprising since it is the process that legitimises the award.
• To what extent does it effectuate the likely intentions or expectations of

the parties?
• To what extent is it consistent with the lex arbitri or the institutional
rules chosen by the parties?
• To what extent does it, consistent with party intent, enable the tribunal
to exercise sound discretion and flexibility on matters of arbitral
procedure?
• To what extent does it protect a party’s right to be heard?
• To what extent does it ensure that the resulting award will be an effective
one?
• To what extent does it enable the resulting award to withstand challenges
in an annulment or enforcement action?
II. PROCESS AND CASE-MANAGEMENT-POWERS
I focus on the tribunal’s wide case-management powers in the carriage of

the arbitration proceedings, which is regulated only by due process requirements
* Rachel Ong holds a LL.M. from Columbia Law School, Class of 2020.
497
imposed by the lex arbitri when one party seeks to annul or challenge enforcement
of the award. In particular, I reflect on the use of the Attorney-Eyes-Only order.
When circumstances merit it, a tribunal has the authority pursuant to its
case management powers to impose an Attorney-Eyes-Only order. An Attorney-
Eyes-Only order is a protective order, which is intended to limit the number of
individuals who are given access to documents or information by a party in
legal proceedings, aimed at safeguarding the confidentiality of discovery
materials. Generally, an Attorney-Eyes-Only order only permits the opposing
party’s counsel to access the material which is the subject of the order but in
some cases the order may also entitle the opposing party’s experts to access
the material. Whilst such an order is not yet commonplace in international
commercial arbitrations, it is not unknown.
On the other side on this see-saw is a party’s right to present his case,
including to test any evidence that is put against it. To use Professor Bermann’s
words, this is probably where trade-offs become inevitable.
Given the confidential nature of commercial arbitration, there remains
little guidance as to how the two values work in tandem in the context of an
Attorney-Eyes-Only order. It may be the case that more of such cases will reach
the curial or enforcing courts in the coming years, which will enable us to glean
important principles in respect of the tension between the two values.
III. CMNC V. JAGUAR
In the meantime, at least, the Attorney-Eyes-Only order has been discussed

in one common law court: the Singapore Court of Appeal in China Machine New
Energy Corp v. Jaguar Energy Guatemala LLC and another [2020] SGCA 12.
It would be beneficial to set out the brief facts of this case to aid the
discussion. The facts are common to most commercial arbitration and arises
out of the construction of a power generation plant in Guatemala. The claimant
owners, Jaguar, had a contract with the defendant contractors, CMNC, to build
the plant. Jaguar terminated the contract following multiple delays and
commenced arbitration to determine, amongst others, the quantum of damages.
During the document production process, Jaguar withheld certain
documentary exhibits referenced in the statements of case on the basis that
there were real concerns that CMNC would misuse the information because the
latter had already engaged in a series of actions against Jaguar’s contractors,
including bribing contractors away from working with Jaguar and intimidating
suppliers and contractors. On that basis, Jaguar made an application that it
would provide these documentary exhibits on an Attorney-Eyes-Only basis.
The Tribunal made the Attorney-Eyes-Only order over CMNC’s objections
(the “AEO Order”) on the basis that the possibility of misuse was a “serious
concern” which needed to be addressed. It is important to note that the AEO
Order consisted of two stages. First, Jaguar would unilaterally designate
documents as Attorney-Eyes-Only and these documents would be provided to
PRO-ARBITRATION OR NOT: THE ATTORNEY-EYES-ONLY MECHANISM 499
CMNC’s lawyers and experts. Second, upon seeing the documents, CMNC’s
lawyers and experts would assess whether it was necessary for the documents
to be showed to CMNC. If so, CMNC would be entitled under the second stage
of the AEO Order to apply to the tribunal for disclosure of materials to CMNC.
CMNC never made an application.
Ten days after the AEO Order was put in place, CMNC made an application
to have the AEO Order replaced by a redaction regime, whereby documents
would be produced to CMNC with sensitive information pertaining to Jaguar’s
contractors’ names redacted. Therefore, the AEO Order was replaced with the
redaction regime less than one month after the former was put in place.
In its application to annul the award, CMNC argued, amongst others, that
the AEO Order hindered it from preparing its case. The Singapore Court of
Appeal studied the annulling provision that allowed an award to be annulled
where the procedural protections in Article 18 of the UNCITRAL Model Law
had not been duly accorded to the award-debtor. Article 18 of the Model Law
provided that each party shall be treated equally and that each shall be given
a full opportunity of presenting its case. The travaux preparatoires indicated
that the drafters of Article 18 were concerned with placing limits on the right
to be heard so that unscrupulous parties who might otherwise seek extension
after extension of any applicable timetable on the basis that each would be
necessary to ensure that party’s “full” opportunity to present its case would be
prevented from doing so. Due process was to be balanced against concerns for
efficiency and expediency of the arbitration proceedings.
Therefore, the Court of Appeal held that the “full” opportunity to present
one’s case was not a right of unlimited scope. Instead, it was impliedly limited
by considerations of reasonableness and fairness. Whether the “full” opportunity
was denied could only be meaningfully answered within the specific context of
the particular facts and circumstances of each case. A curial court asked to
annul an award was to ask itself whether what the tribunal decided to do or
not do fell within the range of what a reasonable and fair-minded tribunal in
those circumstances might have done. The tribunal’s conduct was to be assessed
by reference to what was known to the tribunal at the material time—the
tribunal could not be criticised as having acted unfairly for failing to consider or
address considerations or concerns that the parties never brought to its attention.
Applying it to the AEO Order at hand, the central issue identified by the
Court of Appeal was as follows: “[t]he question [was] not whether the AEO
Order had adversely impacted CMNC’s preparation of its case—it almost
certainly did, to some extent. The question [was] whether the balance struck
by the tribunal in making the AEO Order as a whole—between Jaguar’s interest
in safeguarding the confidentiality of the documents in order to prevent harm,
and CMNC’s interest in being able to prepare its case unhindered in any way—
is one which [was] so unfair or unreasonable as to fall outside the range of what
a reasonable and fair-minded tribunal might have done in the circumstances.”
Evidently, the Court of Appeal recognised that an Attorney-Eyes-Only

order requires a balancing act. On one hand, there was Jaguar’s right to
confidentiality protections over concerns of misuse. On the other, there was
CMNC’s right to prepare and present its case and test the evidence against it.
In protecting one value, the other(s) will necessarily be compromised. But the
decision would only become impugnable if a tribunal strays from what a
reasonable and fair-minded tribunal would have done.
In this particular case, the Court of Appeal concluded that the AEO Order
formulated by the tribunal fell within the range of what a reasonable and fair-
minded tribunal would do. The formulation of the AEO Order allowed CMNC
to apply for disclosure of documents under the second stage, but CMNC never
made such an application. Further, the AEO Regime was only in place for less
than a month, and any unfairness occasioned would have been mitigated by the
redaction order. In this context, there was no breach of CMNC’s Article 18 rights.
IV. OTHER FORMULATIONS OF ATTORNEY-EYES-ONLY ORDERS
Nevertheless, a tribunal’s case management powers are wide enough to

allow it to craft different bespoke formulations of Attorney-Eyes-Only regimes
that may be more or less drastic than that CMNC v. Jaguar. For example, a
Tribunal could craft different restrictions on what attorneys can discuss with
their clients. Or they can create mechanisms for agreement of summaries to be
provided to parties. The Tribunal may require that especially sensitive documents
be only reviewed in camera (either by the Tribunal, or by a fourth arbitrator
appointed for the purpose), or (as was the case in Jaguar v. CMNC) make
redaction rulings and may combine a regime of redaction with an Attorney-
Eyes-Only mechanism.
Self-evidently, the more far-reaching the restrictions that are imposed by
a tribunal in order to protect confidential documents, the harder it will be to
strike the balance with the other party’s Article 18 rights to be heard. The other
party’s Article 18 rights may be so compromised such that the process may be
considered defective.
Some may dismiss this as an over-exaggeration. After all, parties in
international commercial arbitration pay good money for qualified, skilled and
experienced lawyers who are (sometimes) self-professedly the brightest minds,
and who must be able to discern and distil important and necessary facts to
put up a robust defence, without client input. Practitioners may blush at such
high praise initially but will quickly realise that they can be severely impeded
in studying the materials and preparing their client’s case. Talented as lawyers
are made out to be, they were simply not present at the point in which events
occurred that is now is being disputed.
More importantly, the party participating in the arbitration never gets to
see or know the evidence supporting the case against it in both the disclosure
process and the hearing, which if succeeds could result in it being liable to pay
PRO-ARBITRATION OR NOT: THE ATTORNEY-EYES-ONLY MECHANISM 501
out huge amounts of money as award debtor. Not only does this impinge on
the other party’s Article 18 rights, but it also puts at risk six of the twelve
criteria identified by Professor Park. It is unlikely to have effectuated the likely
intentions or expectations of the parties as it is difficult to imagine that a party
would sign up for a process where his fundamental right to presenting his case
is so curtailed. This would also probably offend a party’s right to be heard.
Depending on the formulation of the Attorney-Eyes-Only order, it may be
argued that is not a sound exercise of discretion and flexibility. There is also a
risk that the process of the arbitration is not consistent with the lex arbitri, and
consequently the resulting award is unable to withstand challenges in an
annulment or enforcement action, rendering the award an ineffective one.
Therefore, Professor Bermann’s article is a timely reminder that any
particular action or practice cannot be taken at face value and needs to be
measured against the other competing interests at play. What may seem pro-
arbitration may easily prejudice other arbitration values. On one view, an
Attorney-Eyes-Only order appears to be pro-arbitration as it protects one
party’s confidentiality and/or to prevent harm, respects the tribunal’s case-
management process and enables the arbitration proceedings to proceed
efficiently and economically. However, as discussed, a formulation that goes
too far jeopardises other legitimate values. An Attorney-Eyes-Only order can
be a drastic measure which has a real bearing on the conduct of the matter.
Caution needs to be exercised in balancing the parties’ rights. A tribunal that
imposes such an order should necessarily keep the order under review, remain
fair-minded and stand ready to make necessary modifications based on the
circumstances to ensure that each parties’ Article 18 rights are protected. I
would venture to say that the more onerous the Attorney-Eyes-Only order, the
more alert the tribunal has to be to difficulties arising from such an order.
V. CONCLUSION
Therefore, is an Attorney-Eyes-Only order pro-arbitration? My ruminations

bring me to this conclusion: it depends. It depends on how well the Attorney-
Eyes-Only order is formulated to balance the competing interests. It may be
that the preferred way to decide this question is to conduct a comparative
impairment analysis by comparing the extent to which favouring this practice
prejudices its competing value. As Professor Bermann suggests, perhaps the
best way to mediate the competing considerations is to employ something
along the lines of proportionality, namely, that an Attorney-Eyes-Only order
should not be excessively or unnecessarily detrimental to one or more others.
A less drastic pursuit of one arbitration value (the protection of confidentiality
within an arbitration) may manage to leave other arbitration values (such as
the full opportunity to be heard) largely intact.
Chapter 90
WHAT DOES IT MEAN TO BE PRO-ARBITRATION –
AN EXAMINATION OF PAKISTANI JUDICIARY’S
APPROACH
Rana Sajjad*
Although the term “pro-arbitration” is generally understood to refer to an

attitude, policy or decision that furthers the cause of arbitration, it could mean
different things in different jurisdictions. The wide range of meanings and the
multiplicity of definitions of this term have been comprehensively discussed
by Professor George Bermann in his article titled “What Does it Mean to Be
‘Pro-arbitration’?” published in Columbia Law School’s Scholarship Archive.
The meaning of the term “pro-arbitration” is partly shaped by the experience
a stakeholder has had in arbitration in a particular jurisdiction. For instance,
parties to arbitration proceedings in Pakistan usually raise concerns about the
courts’ undue intervention and arbitration counsel here take issue with the delay
in the courts’ decisions on challenges to arbitration agreements and enforcement
of arbitral awards.
The role and attitude of all three stakeholders or decision makers, namely
the legislature, judiciary and the users, as referred to by Professor Bermann in
his article, is undeniably pivotal to creating an enabling and pro-arbitration
ecosystem. Although the importance of a pro-arbitration legislature and, in
turn, a modern legal framework for arbitration, cannot be overemphasized, as
far as Pakistan is concerned, it is the judiciary’s approach to arbitration that is
of critical importance to creation of a pro-arbitration ecosystem. This is because
the judiciary either deliberately, due to a bias against arbitration, or erroneously,
due to a lack of capacity, would misapply or misinterpret even the most clearly
facilitative and pro-arbitration provisions of the law. The consequent invalidation
of valid arbitration agreements and annulment of valid arbitral awards leads
to an appropriate characterization of the judiciary and, in turn, the jurisdiction,
as anti-arbitration.
Arbitration enthusiasts, experts and practitioners may presume that any
misstep or omission on the part of the judiciary is motivated by ill will to
undermine arbitration. Furthermore, when certain patterns emerge whereby
courts continue to set aside awards on a regular basis, it raises legitimate
* Rana Sajjad is the Managing Partner of Triage Law and the Founder and President of the
Center for International Investment and Commercial Arbitration (CIICA), Pakistan’s first
international arbitration center. He is a Fellow of the Chartered Institute of Arbitrators (CIArb)
and an accredited mediator of the Singapore International Mediation Institute (SIMI). He was in
the Columbia LL.M. class of 2002.
503
concerns regarding the judiciary’s strong prejudice against arbitration. In

order for the judiciary to be considered pro-arbitration in this context, it needs
to refrain from undue intervention in arbitral proceedings to assume jurisdiction
of the case without legal basis and dismiss unwarranted or misconceived
challenges to an arbitration agreement’s validity or to the enforcement of valid
arbitral awards.
To hone in on another critical issue raised in Professor Bermann’s article,
the judiciary’s approach also needs to be examined on the basis of the interplay
of competing and possibly conflicting considerations and tradeoffs. More
specifically, we need to understand whether a seemingly anti-arbitration
approach that prejudices a pro-arbitration value could still constitute a pro-
arbitration approach if it privileges another, possibly more important, pro-
arbitration value, even if it is an extrinsic consideration. For instance, would a
Judge who has dismissed 80% of the challenges to enforcement of an arbitral
award be considered pro-arbitration solely on the basis of this metric? What if
only 30% of the challenges to enforcement before that Judge were unfounded
and the other 50% had strong grounds? Would enforcement of the additional
50% that should not have been enforced still further the cause of arbitration
and rightly credit the Judge with having a pro-arbitration approach? In the same
vein, what if a particular Judge incidentally only hears challenges to arbitration
agreements or awards that have strong grounds and warrant invalidation of
the agreements and annulment of the awards? If the Judge rightly accepts such
challenges, would characterizing such a Judge’s approach as anti-arbitration
be fair? What if the jurisdiction in which a court is located is such that the
process of arbitration is commonly abused by the parties adding another layer
of caution and justifiable reluctance on the part of Judges to enforce arbitration
agreements and awards? Rather counter-intuitively, should these Judges not
be considered pro-arbitration if by accepting well-founded challenges to the
validity of arbitration agreements and awards, they are upholding and preserving
the integrity and fairness of the arbitral process? Should we not reconsider our
view of such Judges who are well-intentioned in weighing these considerations
and aiming to be as pro-arbitration as possible while deciding these valid
challenges? Is the pro-arbitration thought process and reasoning of these Judges
not more important than the purportedly anti-arbitration outcomes?
Instead of having a narrower focus and rigid criteria for labeling an approach
as anti-arbitration, it is important to zoom out and see the big picture in which
broader issues and extrinsic considerations, such as the ones discussed by
Professor Bermann, are also taken into account while deciding whether the
judiciary in a particular jurisdiction is pro-arbitration.
Chapter 91
THE TENSION BETWEEN CONFIDENTIALITY AND
TRANSPARENCY IN ARBITRATION
Ricardo Ampuero Llerena*
In a globalized world, where international trade and investment flows have

facilitated economic growth, generated development, increased competition and
created new businesses, we have also witnessed the emergence of effective
and efficient mechanisms for resolving conflicts. In this regard, there are many
reasons that explain the suitability of arbitration as a useful tool to peacefully
settle disputes. These also explain its growth to become one of the most sought-
after alternative dispute resolution mechanisms.
When I was a law student, I remember being taught that one of the
characteristics that made arbitration such an attractive mechanism to resolve
disputes was, among others, its confidentiality.
This, of course, makes sense when we think about commercial disputes. These
types of disagreements, which for the most part only involve private parties
doing business with each other, generally only affect them. It is therefore
logical that they would favor a dispute resolution mechanism different from
local courts which provided the possibility of keeping the details of such
controversy private, including in some cases the very fact they had a dispute.
When the use of arbitration extended, it was not only private companies
and individuals using it for their contractual disagreements, but also States and
public entities. The scope of disputes expanded to include those which involved
not only private interests. Thus, it became necessary to tailor certain provisions
that consider the nature of these disputes as they involve matters of public
interest and government policy that are not necessarily present in a commercial
dispute between two private parties. With this, a trend toward transparency
in arbitration began to emerge.
The clearest example of this is investor-state dispute settlement (ISDS).
Because these disputes have an impact on the international community, it is
positive that these decisions are made public considering accountability and
good governance.
* Ricardo Ampuero Llerena is an Arbitrator, Independent Counsel and Law Professor at the
Universidad Peruana de Ciencias Aplicadas and Pontificia Universidad Católica del Perú. He
served as President of the Special Commission that represents the Republic of Peru in
International Investment Disputes, a commission in charge of coordinating the legal defense of
the State in all stages of investor-State disputes. He holds a Law degree from Universidad
Peruana de Ciencias Aplicadas and a Master in Law (LL.M.) degree from Columbia University.
505
Bilateral Investment Treaties (BITs) and Free Trade Agreements with

Investment Chapters (FTAs) have seen a notable evolution in recent decades.
This is largely explained by the fact that states have gained knowledge from their
collective experience in international investment disputes and have taken steps
to incorporate it in the process of negotiating those instruments, moving away
from broad or vague standards of protection and lack of regulation of the
arbitration process.
I believe that, to a certain extent, the comprehensive development in new
generation treaties of the scope and limits of the protection granted to foreign
direct investment, as well as the detailed regulation of various procedural aspects,
can be considered a response from States to criticism of ISDS.
This evolution has undoubtedly contributed to address issues such as the
safeguarding of the regulatory prerogative of the States, that is, legitimate
measures that can be adopted in pursuit of public policy objectives, and the
legal certainty that comes with a clear development of the content of protection
standards. All of this with the goal of strengthening the system and generating
consistent decisions, which in turn addresses the legitimacy of ISDS.
With those new regulations, BITs and FTAs have also tackled the issue of
transparency in arbitration. These provisions have been important not only for
the emergence of clearer lines of interpretation of investment protection
standards but have also provided the main actors in the system -such as States
and investors- with the possibility of, for example, identifying more easily
arbitrators who have specific experience with certain categories of claims or
the criteria commonly applied to discern certain aspects common to this type
of processes, such as the valuation of damages.
Other efforts have also played a role in the trend toward transparency. The
United Nations Convention on Transparency in Treaty-based Investor-State
Arbitration (Mauritius Convention) entered into force in October 2017 and, to
date, nine States are parties to this instrument. A key aspect of the Mauritius
Convention is that parties have flexibility to formulate reservations, which allow
them to exclude from the application of the Convention a specific investment
treaty or a specific set of arbitration rules other than the UNCITRAL Arbitration
Rules, or to declare that it will not provide a unilateral offer of application.
This flexible approach is important. Some countries have made the decision
to negotiate the specific scope of transparency provisions in each BIT or FTA,
as it may be necessary to consider certain sensitivities that are important for
some States and not for others. A case-by-case approach, while striving for
coherence, ponders, among other things, the complexity of the negotiation
process and the prerogative States enjoy in determining the specific content of
the treaties they sign.
A cautious process like the one described above is pertinent because,
although it is true that transparency provides numerous benefits, a balance is
necessary. It is equally important, when designing transparency provisions, to
take measures to clearly establish justified exceptions, the procedural moment
THE TENSION BETWEEN CONFIDENTIALITY AND TRANSPARENCY 507
when documents are made public, a well-structured mechanism to protect

information that should not be published and a process to adequately resolve
any disagreement between the parties in this regard.
This will also protect the arbitration process by avoiding the aggravation
of the dispute. Because these cases involve matters of public interest and
government policy, as discussed before, it is possible that external factors or
actors that are not a party of the arbitration generate a disruption.
For example, if an investment arbitration involves a project that has captured
the attention of politicians or the press, contemporaneous publication of written
submissions, procedural orders or allowing public into the hearing may
aggravate the dispute or put pressure on the parties or even the Tribunal itself.
Transparency provisions should take this scenario into consideration, and, in
any case, it should be made clear that tribunals ought to hold delegated power
to take measures that avoid a situation where a case is litigated in the press or
is subject to interference by political actors.
While ISDS has undoubtedly been at the forefront in calls for transparency,
the trend has not been limited to these types of disputes. There have been
numerous initiatives regarding actions for transparency in arbitration, at least
regarding certain aspects.
For instance, some arbitral institutions like the International Chamber of
Commerce or the Permanent Court of Arbitration have implemented rules to
make basic information about disputes available. This includes summaries of
awards, members of Arbitral Tribunals, industry sectors of disputes, law firms
involved and decisions on disqualification requests of arbitrators. Such steps
have been justified by citing the importance of making this information available
to the parties, the business community and academia to ensure that arbitration
remains a legitimate mechanism, to provide greater confidence in the process
and to protect it from inaccurate information.
There are also other initiatives that highlight the benefits and importance
of making certain information from disputes available to the public, like Arbitrator
Intelligence. This is an information aggregator that collects and analyzes
information about arbitrator’s track records, which parties can use to better
inform their arbitrator selection.
It generates reports containing a combination of publicly available awards
but also, when possible, anonymous feedback collected from the parties involved
in a given case. This feedback gives insight into the arbitrator’s procedural rulings
and case management. It also provides information about the interpretive
methods applied by arbitrators to certain contractual and legal issues.
This is valuable information which can make the appointing process more
efficient and predictable. In turn, it could also have a positive impact on cost
and duration of the arbitration because the parties will be able to make better-
informed choices and have a tribunal that meets their needs for a specific
dispute. It could even prove helpful in advancing diversity and opportunities
for young arbitration practitioners.
Another example can be found in Peru, where arbitration has been heavily
criticized due to some corruption scandals. The largest arbitral institution in
Peru, the Arbitration Center of the Lima Chamber of Commerce, launched an
initiative called the “Faro de Transparencia” (Transparency Lighthouse). It is a
digital platform aimed at providing public access to key pieces of information
regarding arbitrations administered by the Lima Chamber of Commerce and
the arbitrators acting in them since 2012.
The main goal of the Transparency Lighthouse, as stated by the Lima
Chamber of Commerce, is to provide arbitration users with more information,
to allow them to make better informed decisions when appointing arbitrators.
It is likely that other arbitral institutions in the country will follow with similar
actions.
The information published relates to: (i) the number of cases in which an
arbitrator has participated or is currently participating, (ii) the nature of those
disputes, (iii) the names of its co-arbitrators, (iv) the law firm that has appointed
the arbitrator, (v) the dates of the request for arbitration and of the arbitral
award, (vi) the current status of the proceeding, and (vii) any disciplinary sanction
that the arbitrator may have received from the institution’s Arbitration Court.
The digital platform also publishes the full text of the awards that have
been issued in proceedings involving a state entity, considering that Peruvian
law requires that, in arbitrations in which the Peruvian State intervenes as a
party, the arbitration proceedings and the award are made public once it has
concluded.
The legal requirement of transparency in cases involving Peruvian State
entities, which is a regulation present in several countries, has a statement of
reasons which explains that it responds to the fact that these cases resolve
matters that are of interest to the public or refer to the use or allocation of
public funds. In situations like those, for transparency reasons, citizens and
authorities must have access to relevant information.
It is important to highlight, however, that the publication of the arbitration
proceedings and the award will occur only when the arbitration has ended. As
discussed before, this is a way to reach a compromise in relation to the tension
between confidentiality as a characteristic of arbitration and the transparency
of the proceedings of cases in which the State participates.
Some describe these regulations and initiatives as a reflection of the tension
that exists between confidentiality and transparency in arbitration. One could
wonder which one of those sides favors arbitration more or is more likely to
be qualified as “pro-arbitration” measures.
As Professor George A. Bermann explains in his article “What Does it Mean
to Be ‘Pro-Arbitration’?”, a policy or practice could generally be described as
arbitration-friendly when it favors the achievement of international arbitration’s
purposes. This can be challenging to describe in absolute terms. In the case of
transparency, the article highlights that the development of these provisions
THE TENSION BETWEEN CONFIDENTIALITY AND TRANSPARENCY 509
does not come directly from values associated with arbitration. Rather, it
comes from the public’s right to know of matters of legitimate public interest.
In the long run, the goal is to advance the legitimacy of arbitration overall.
In that sense, the conversation about confidentiality and transparency should
not be framed as two notions opposing each other or competing for the prize
of being labelled as “pro-arbitration”, which ultimately can prove to be a
difficult concept to define. It is a complex matter that requires, as we have seen,
certain trade-offs to achieve an adequate balance.
This balance is an ongoing process and, if anything, it constitutes a sign of
development in the field. It reveals efforts from the international arbitration
community to address the concern of what can be done to have a more
legitimate system for alternative resolution of disputes, considering intrinsic
and extrinsic values to arbitration. We will continue to see efforts in this regard
and, in this context, an invitation to expand our notion of what is and what is
not pro-arbitration, like Professor Bermann eloquently delineated, is of the
utmost relevance.
Chapter 92
MAXIMIZING THE ECONOMIC BENEFITS
PRODUCED BY INTERNATIONAL COMMERCIAL
ARBITRATION: BEYOND “PRO-ARBITRATION”
POLICIES
Riccardo Loschi*
There is consensus around the positive impact that international commercial

arbitration can have on the investment climate of countries’ economy. Among
other benefits, international commercial arbitration contributes to reducing or
overcoming the institutional gap between institutions and businesses, positively
influences countries’ investment location determinants, and helps them to
attract and retain foreign investments. The positive effects of international
commercial arbitration are generally greater in countries that present higher
regulatory risks for private entities. In those countries, the availability of
international commercial arbitration is particularly valuable as it allows
companies to resolve disputes without having to deal with potentially inefficient
domestic litigation proceedings.
The desiderata of arbitration regimes, the criteria to achieve them...
The mere existence of an international commercial arbitration regime (arbitration
regime) does not automatically produce economic benefits for the country’s
economy. Many jurisdictions already allow companies to arbitrate their disputes
via international commercial arbitration, even if there is no connection with
that country. Hence, there is no guarantee that establishing an arbitration regime
will lead private entities to settle their disputes in that jurisdiction, or that the
arbitration regime will significantly improve the location determinants of that
country. How to achieve economic benefits through international commercial
arbitration, however, is not entirely clear. From a policy perspective, efforts have
been made to identify the features which make an arbitration regime more
suitable to maximize economic benefits. The World Bank, for instance, has
identified the following desiderata: (i) “easily accessible” and straightforward
arbitration provisions; (ii) strong arbitration laws in line with modern arbitration
laws and practice; (iii) “solid awareness of what arbitration entails as a dispute
resolution tool;” (iv) high party-autonomy in conducting the proceedings;
(v) local courts supportive of arbitration proceedings which consistently and
efficiently enforce awards; and (vi) adherence to international conventions
* Riccardo Loschi (LL.M.) is an Associate Lawyer at LALIVE and former Managing Editor of
the Columbia FDI Perspectives series. He specializes in international investment law, arbitration
and FDI policy.
511
concerning arbitration [World Bank, Investing Across Borders, The World Bank
Group (ed.), 2010, p. 65].
While these desiderata may delineate the trajectory of countries’ reforms
of the arbitration regime, they risk remaining little more than empty slogans.
What makes a legal regime “strong”, or local courts “supportive” is not self-
evident but requires complex legal and context-based analyses. Legal scholars and
institutions have analyzed the legal framework of jurisdictions that are deemed
to provide the most favorable setting for parties wishing to arbitrate their
disputes. Based on the arbitration regime in place in those jurisdictions, a wide
array of parameters and indicators have been developed to determine if and to
what extent a jurisdiction is “pro-arbitration” or not. The non-exhaustive catalog
proposed by Professor George A. Bermann provides helpful guidance in this
respect, as it highlights what “pro-arbitration criteria” mainly aim at achieving:
determining “how much” an arbitration regime (i) renders arbitration proceedings
time- and cost-efficient; (ii) upholds consent to arbitrate and broadens the
scope of party autonomy; (iii) ensures the independence and impartiality of
arbitrators; (iv) minimizes, to the fullest extent possible, the intervention of
national courts in the arbitral process; (v) enables the resulting award to
withstand challenges in an annulment or enforcement action; and (vi) expands
the categories of legal claims treated as arbitrable [George A. Bermann, What
Does it Mean to be “Pro-Arbitration”?, 34 ARB. INT’L 341 (2018), p. 343].
…and their shortcomings. If, at first glance, pro-arbitration criteria seem
to provide the keys to implementing the policy desiderata of an arbitration
regime, their application may turn out to be impractical, contradictory, or
unhelpful. Specifically, increasing the level of “friendliness” of a jurisdiction
toward international commercial arbitration may produce inconsistent results,
or no results at all. This is because, as observed by Professor George A. Bermann:
“[t]here are at least a dozen different ways to measure the impact of a given
policy or practice on international arbitration’s well-being. That impact cannot
accurately be gauged when attention is focused exclusively on [some] ways of
gauging arbitration friendliness” [George A. Bermann, What Does it Mean to be
“Pro-Arbitration”?, 34 ARB. INT’L 341 (2018), p. 353].
For instance, pro-arbitration criteria would suggest increasing the scope
of arbitrable disputes to allow recourse to arbitration in a greater variety of
situations. Yet, as explained below, this may expose the award to the risk of
being set aside at the enforcement stage in the territory of the state or abroad.
Moreover, the pro-arbitration nature of a policy may depend on the case-specific
outcomes it produces. A law of the seat which does not allow any review of the
award based on errors of law is pro-arbitration in the sense that it reinforces
the “finality” of the award. Yet one may wonder whether tolerating and enforcing
potentially wrong decisions on the law is really pro-arbitration.
Additional problems and contradictory inputs may derive from the
combination of policy desiderata and pro-arbitration criteria. As noted, a
traditional pro-arbitration approach requires that countries relinquish control
ECONOMIC BENEFITS PRODUCED BY INT’L COMMERCIAL ARBITRATION 513
over arbitration proceedings taking place in their territory, while the desiderata
suggest that domestic courts should be as supportive as possible of arbitration.
In fact, it is unclear whether a complete separation between arbitration and
domestic courts is desirable in practice and would make the arbitration regime
more effective. Arbitration arguably needs the state’s support to ensure that it
is “enforced.” A “no-intervention” scenario would deprive tribunals of coercive
powers, potentially leading to procedural distortions and abuses. At the same
time, a “selective intervention” of state courts in arbitration proceedings could
lead to situations where the state court’s actions undermine the efficient
conduct of the arbitration.
Lastly, and perhaps even more importantly, the criteria used by the pro-
arbitration approach may not entirely correspond to those on which
companies make investment decisions. Research shows that the key driver of
companies’ decisions to (continue to) invest in a country is the presence of
potentially profitable opportunities, coupled with basic social engagement and
straightforward legal and business rules [see, e.g., P. Mallampally and K.P.
Sauvant, Foreign Direct Investment in Developing Countries, in 36 FINANCE AND
DEVELOPMENT 1 (IMF, 1999)]. Since businesses tend to prioritize profit
maximization over other outputs, companies often give more importance to
laws which provide efficient results over those which produce just (or the best
possible) outcomes. Take, for instance, the widespread application of English
law to the trade of commodities. Through time, English law has become the
preferred legal framework for commodity traders even though it tolerated
traders’ opportunistic behavior and, to a certain extent, encouraged “efficient”
breaches of contract to avoid prospective losses. One of the main reasons, it
has been argued, is that English law does not interfere with business dealings
and tends to grant faster, more certain and predictable results which market
players can hedge in advance on the market [see, e.g., Lord L. Irvine, The Law:
An engine for Trade, in 64 MODERN L. REV. (2001), p. 334]. Similar principles
seem to apply in the context of dispute resolution mechanisms. For example,
notwithstanding the absence of ISDS provisions in Brazilian international
investment agreements, Brazil regularly ranks among the top investment
business destinations worldwide. The presence of attractive business
opportunities, combined with other alternative dispute settlement solutions—
such as a well-function arbitration regime—seems to provide companies with
sufficient confidence to operate in the country. In China, the long-lasting
hostility to relinquishing control over commercial arbitration proceedings (for
instance, to date Chinese courts are not allowed to formally recognize or enforce
emergency relief orders issued by foreign arbitral tribunals) has not affected
the country’s attractiveness as an investment destination.
Certain and predictable arbitration regimes: practical applications.
These considerations suggest that arbitration regimes which maximize economic
benefits may not be those fostering the use arbitration as much as possible, but
rather those which ensure stable regulatory environments and produce
predictable results. The following paragraphs summarily investigate possible

policy implications of this paradigm shift.
Preliminary, it bears emphasis that focusing on certainty and predictability
does not mean ignoring the pro-arbitration criteria discussed above. A good
number of those criteria pursue goals that do not only foster pro-arbitration
values, but also reinforce the autonomy and functioning of international
commercial arbitration. Thus, some of them remain essential to any arbitration
regime, such as ratifying the New York Convention, clearly defining its scope
and the grounds for setting aside awards; allowing parties to freely choose the
law applicable to their contracts and the seat of arbitration; and non-interfering
with arbitrators’ decision on their own jurisdiction. However, focusing on
certainty and predictability can help countries to implement better targeted
and effective arbitration policies, as shown below.
Targeting the arbitration “stages” that are more economically significant
for a country. Arbitration reforms may focus on assuring certainty and
predictability in respect of one or more stages or phases of the arbitration regime.
For instance, countries may focus on enforcing awards in a consistent manner
(safe jurisdiction) but have no interest in establishing themselves as arbitral
seats. By contrast, countries may wish to establish themselves as a preferred
arbitral seat (safe seat) but refuse to abandon certain requirements specific to
its legal system for the recognition of foreign awards.
The examples of India and the UAE demonstrate that nuanced versions of
this distinction exist in practice. While both jurisdictions have witnessed a
relatively recent growth of their arbitration market, these countries have
pursued quite different arbitration policies. On the one hand, India has been
consistently recognizing and enforcing arbitral awards issued outside of its
territory but has kept quite tight controls over arbitration proceedings conducted
within it. This has consolidated its position as a safe place to do business, but
most foreign companies arbitrate their disputes abroad. The UAE, by contrast,
was able to establish itself as a preferred arbitral seat, but, until recently, its
courts kept imposing specific “domestic” requirements for the enforcement of
awards. Interestingly, this solution did not affect the UAE’s position as an
arbitration hotspot, and possibly encouraged companies to arbitrate their
disputes in the UAE to reduce the risks at the enforcement stage. Different
reasons militate in favor of choosing one or the other policy. For instance,
developing countries located in an emerging economic region may have an
interest in establishing themselves as safe seats in order to maximize economic
benefits both indirectly (i.e., by improving the economy’s business climate) and
directly (i.e., by developing a dispute resolution market).
Recognition and enforcement of arbitral awards: certainty over
simplicity. When brought to its extreme, the pro-arbitration approach may
promote simpler solutions over certain ones, and this may affect the stability
of the award. In the enforcement context, pro-arbitration criteria favor fast and
straightforward enforcement proceeding, ideally carried out by the same (and
ECONOMIC BENEFITS PRODUCED BY INT’L COMMERCIAL ARBITRATION 515
only) competent court. Thus, having multiple courts competent to review

awards hardly sounds like an appealing idea. Unsurprisingly, the recent decisions
of French Tribunal of Conflicts requiring that administrative courts, and not civil
courts, review awards based on contracts governed by mandatory administrative
law provisions has been criticized due to the risk of judicial fragmentation (see,
e.g., the Engie case). In fact, preventing the court that is better placed to decide
on mandatory provisions from doing so may expose the award, or the decision
recognizing it, to the risk of being invalidated (e.g., on constitutional or other
grounds). This could especially be the case where—unlike in France—no
specialized court like the Tribunal of Conflicts exist and thus similar conflicts
may perpetuate through many judicial instances. In other words, “one-stop-shop"
solution are not necessarily key to effective arbitration regimes. To increase
certainty, arbitration laws should aim at regulating ex ante the allocation of
competences, making sure that awards are reviewed promptly by the competent
court, and that the allocation is compatible with the fundamental principles
governing jurisdictional issues and the review of awards.
Quality over quantity: arbitrability ratione materiae. One of the most
critical issues for an arbitration regime is defining which disputes can be settled
through arbitration, i.e., the scope of arbitrability ratione materiae, or “objective
arbitrability.” Examples of disputes commonly regarded as non-arbitrable are
those involving consumers, employment, bankruptcy, and—albeit only to a
certain extent—IP rights and corporate matters. If a dispute is non-arbitrable,
the tribunal declares that it lacks jurisdiction to adjudicate the dispute. It is
sometimes argued that the scope of objective arbitrability measures the trust
that the country places in the use of arbitration. In this regard, it has been noted
above that a “pure” pro-arbitration approach would suggest limiting the scope
of non-arbitrable matters to a minimum. However, an overly broad, generic, or
imprecise definition of objective arbitrability—e.g., one which covers disputes
encompassing public interest or policy considerations – could create uncertainty
around the fate of the award and threaten its enforceability (see, e.g., Articles II
and V of the New York Convention). Examples of the detrimental effects of this
uncertainty are the long-lasting debate over the arbitrability of antitrust disputes
in the US (see, e.g., the U.S. Supreme Court judgment in Mitsubishi v. Soler) and
the European Union’s refusal to recognize intra-EU investment awards (see,
e.g., the CJEU judgments Achmea, Komstroy, and PL Holdings), notwithstanding
the EU institutions’ efforts to frame this issue as a validity of the arbitration
agreement. Certainty and predictability may be better achieved by those regimes
which identify clearly which disputes may be arbitrated. In this respect, a
negative definitory approach would allow arbitrators to clearly identify those
matters which do not fall within their jurisdiction. Lastly, the arbitration regime
should provide for rules and criteria to resolve conflicts in case only certain
aspects of a dispute are non-arbitrable. For instance, domestic courts may be
empowered to decide on a preliminary non-arbitrable matter, or a court’s
competence may extend to the entire dispute if part of it is not arbitrable.
Domestic courts’ intervention in arbitration: are predictable rules more

business-friendly than “pro-arbitration” ones? Today, arbitration regimes
that allows domestic courts to enforce interim measures or emergency relief
orders issued by arbitral tribunals are generally considered pro-arbitration. At
the same time, however, domestic courts’ review of those orders impinges on
the autonomy of arbitration. Yet it is unclear whether these potentially
ambivalent situations weigh on businesses’ decisions at all: companies make
investment decisions before the dispute materializes and without knowing on
which side of it they will be. In similar ambivalent situations, maximizing
economic benefits may depend on the clarity of the rules of the game, rather
than on their merits. Take, for instance, the long-lasting but recently settled debate
regarding the scope of 28 U.S.C. § 1782 in the United States. On 13 June 2022,
the U.S. Supreme Court held that parties in private (commercial) arbitration
proceedings seated outside the United States cannot rely on Section 1782 to
obtain discovery from U.S.-based third parties. Therefore, from a “predictability”
and business perspective it is not particularly relevant whether the U.S.
Supreme Court’s decision is pro-arbitration—what matters is that it eliminates
the risk of further contradictory and inconsistent outcomes.
Concluding remarks. Today, international commercial arbitration is an
indispensable tool in the toolkit of countries that seek to attract and retain
investments and bolster economic growth. While policy-based studies identify
the desiderata of international commercial arbitration regimes, their
implementation is not straightforward. The “pro-arbitration” approach neither
produces consistent results nor provides adequate guidance in the
implementation of the mentioned desiderata. Based on a preliminary analysis
of businesses’ decision-making process, certain and predictable arbitration
regimes may produce better economic results, and help countries identify
more effective policies to reform their legal framework. While these conclusions
are necessarily based on approximations, they do not seem unreasonable.
Companies regularly invest in countries that do not have a markedly pro-
arbitration regime, yet they fear unclear, inconsistent, and unpredictable
procedures or outcomes. The proposed “paradigm shift” may determine a
departure from the traditional “pro-arbitration” approach and inspire new
structural policies. Due to the legitimation crisis of other supranational dispute
resolution mechanisms and the increasing polarization of markets and
politicization of economies, stable and predictable arbitration regimes are
becoming even more important to safeguard foreign and domestic companies’
possibility of doing business. It is therefore key that countries, and especially
developing ones, understand the needs and decision-making processes of
private businesses and develop policies which can help attract and preserve
private investments.
Chapter 93
AN APPRECIATION OF GEORGE A. BERMANN
Richard L. Mattiaccio*
When parties to a contract or treaty decide to forego resolution of possible

future disputes in the context of a national court system, they make a leap of
faith. They trust in a more private system to provide them with neutral decision-
makers who will treat parties to the dispute without favoritism, in accordance
with the parties’ agreement, and subject to the law or principles of law the
parties have chosen to govern their relationship. Once a dispute has arisen, the
selection of private individuals to serve as arbitrators represents a further act
of trust in individuals to render a decision on the merits with little or no
recourse to the courts. It is natural for any individual so chosen to feel honored
and to be sobered by this remarkable show of confidence.
Confidence is not freely given, however; it must be earned. Contracting
parties, in considering the adoption of an arbitration clause, may have their
qualms. National/state courts called upon to grant interim relief in aid of
arbitration, or to confirm, annul, enforce or decline to enforce an arbitral award,
may have their doubts about the wisdom of extending such judicial assistance to
a system of dispute resolution that bypasses the court system in determining
the merits.
So, what does it mean to be “pro-arbitration” in a world that still has
pockets of skepticism that border, at times, on hostility? It means, at least in
part, advocating in favor of an arbitral system that earns and retains confidence
and reduces skepticism; with a particular focus on three basic features of
arbitration: (I) the consent of the parties, (II) the procedural rules governing the
conduct of the arbitration, and (III) the rules of ethics governing the conduct
of the arbitrators.
* Richard Mattiaccio was a student in the first course taught by Professor Bermann at
Columbia Law School. Since that time, he has worked with Professor Bermann on multiple
occasions in matters related to international arbitration, comparative law, and cross-border
litigation. Following an appellate clerkship in Washington, D.C., nearly four decades in international
practice in New York in large firm and boutique law firm contexts, and over three decades as
arbitrator in commercial and IP-related matters, Mr. Mattiaccio became a full-time, independent
arbitrator in 2020. He serves as arbitrator in AAA/ICDR, ICC and CPR Rules cases and in ad hoc
international arbitration. He is a co-director, with Professor Bermann and others, of the Columbia–
CIArb Comprehensive Course on International Arbitration, and he teaches international
commercial arbitration at Fordham Law School. He is a Chartered Arbitrator and Fellow of the
Chartered Institute of Arbitrators (CIArb), a Fellow of the College of Commercial Arbitrators
(CCA), and a Member of the National Academy of Distinguished Neutrals.
517
I. THE REQUIREMENT OF CONSENT AS A BASIS FOR CONFIDENCE
It is hard to conjure, in the context of dispute resolution, a specter that is

much scarier than unwittingly committing oneself to a process that bars effective
recourse on the merits in any court of law. It is one thing to enforce agreements
to arbitrate in a way that makes arbitration clauses “sticky” between or among
parties to the agreement. It’s quite another matter to enforce an arbitration
clause without paying careful attention to its existence, validity, or scope.
Trapping unsuspecting parties in a “gotcha” arbitration is a sure and direct
path to undermining perceptions of fairness and integrity. “Pro-arbitration,” in
this context, minimizes the risk that arbitrators overstep their bounds or
abdicate their responsibilities. There is no one-size-fits-all solution to this real
or perceived problem. (Even if the problem is only perceived, it is no less real
in terms of confidence.) Possible approaches might include de novo judicial
review of arbitrator determinations of their jurisdiction based on First Options,
as George Bermann and other scholars and practitioners have advocated. For
those who are concerned that, in many cases, the increased time and cost
involved in de novo review of jurisdictional determinations of arbitrators may
outweigh the benefits, a pro-arbitration approach might involve the adoption
of internal procedural safeguards such as providing the option of appellate
review of jurisdictional determinations within the arbitration itself.
Whatever the solution might be to assuring arbitrator accountability in
deciding the arbitrator’s jurisdiction, it is “pro-arbitration” if it bolsters confidence
in the arbitration process. This, one plausibly workable definition of “pro-
arbitration” could be, simply, “a thoughtful approach that tends to support the
actual and perceived integrity of the arbitration process.”
Reasonable minds may differ over precise solutions. If confidence is the
goal, however, solutions that confer on arbitrators (who, for the most part, are
only human) totally unfettered discretion to determine their own authority,
cannot be considered to be pro-arbitration.
To borrow a phrase in current usage, arbitrators are not kings. To the extent
we allow arbitrators to act like kings, confidence in arbitration will wane.
Advocating, in the name of efficiency, in favor of the divine right of arbitrators,
should not be considered a “pro-arbitration” position.
II. PROCEDURAL RULES AS A SOURCE OF CONFIDENCE
The arbitration community has had some of its finest moments in the
thoughtful development and constant improvement over time of the arbitration
rules of the major institutional providers and in parallel efforts undertaken in
the development and improvement of rules for ad hoc arbitration, most notably
the UNCITRAL Rules. As anyone involved in these efforts is likely to attest, the
work is continuous because it needs to mirror the evolution of the law of
arbitration, arbitration practices, and user expectations.
AN APPRECIATION OF GEORGE A. BERMANN 519
At times the interaction between arbitration rules and the evolution of

arbitration law can have unexpected or unintended consequences requiring a
further revision of arbitration rules to avoid anomalous results. Returning to
a previously mentioned illustration, recent federal appellate case law in the
United States has tended to treat the mere incorporation by reference of
arbitration rules as satisfying the First Options requirement of a clear and
unmistakable delegation of primary authority (i.e., excluding judicial de novo
review) to the arbitrators to decide their own jurisdiction. It seems doubtful
that the institutional rule makers presumed to reverse the U.S. Supreme Court’s
rebuttable presumption, established in First Options, that primary jurisdiction
to decide arbitrator jurisdiction lies with the courts, not with the arbitrators.
Assuming the U.S. Supreme Court does not address the tendency of the Circuits
to read so much into plain vanilla arbitration rules, it will be for the institutional
providers, in the context of their rule-making process, to determine whether a
“pro-arbitration” position involves establishing some reasonable measure of
arbitrator accountability within the arbitration process when arbitrators
decide their own jurisdiction.
III. THE CODE OF ETHICS AS PRO-ARBITRATION
Confidence in arbitration in the United States has been well served since
1977 by ABA/AAA Code of Ethics for Arbitrators in Commercial Disputes (the
“Code”), a code that was updated in 2003 and that has been adopted in large
part by other institutional providers.
It is beyond the scope of this discussion to delve in detail into the Code or
to embark on a discussion of its counterparts. The Code does illustrate, however,
the positive role that reasonable limits on arbitrator power and discretion can
have on confidence. Briefly, Canon I limits the circumstances in which an
arbitrator may accept an appointment and how the arbitrator may interact
with the parties and their interests once the arbitrator is appointed. Canon II
imposes broad obligations on arbitrators to disclose any interest or relationship
likely to affect impartiality or that might create the appearance of impartiality.
Canon III restricts the ability of an arbitrator to communicate with the parties.
Canon VI imposes obligations of confidentiality on the arbitrator. Canon VII
sets standards for arbitrator billing practices. Canon VIII sets standards for
arbitrator advertising or promotion. Canon IX requires arbitrator neutrality
subject to a Canon X election. Canons IX and X impose all the obligations of
Canon IX neutral arbitrators on Canon X arbitrators except those expressly
excluded in Canon X.
The Code, in sum, limits arbitrator power and discretion. Clearly, it is pro-
arbitration precisely because it imposes reasonable limits intended to support
confidence in arbitration. Indeed, it is hard to imagine commercial parties
agreeing to arbitration in the absence of such limits.
Forty-five years of experience with the Code teaches that reasonable limits
on arbitrator power or discretion can be fundamental to sustaining and advancing
arbitration. Experience teaches that arbitrator accountability, particularly on
matters of fair play, is essential to widespread acceptance and use of arbitration.
Some marginal increase in the time or expense of arbitration is a reasonable
price to pay to sustain confidence in the system.
The devil, of course, is in the details.
Chapter 94
INDIAN ARBITRATION – THE ILLUSION OF A
“PRO-ARBITRATION” DEVELOPMENT
Rishab Gupta and Lakshana R*
Over the past few years, India has been vocal about its ambition to become
a global arbitration hub, as its economic dominance boasts an upward streak.
Indeed, promoting arbitration—alongside championing economic growth—has
been a key priority for the current administration. This is reflected in major
amendments to the arbitration law of India and numerous government policies,
aimed at boosting Indian arbitration.
The judiciary has also espoused the lofty cause and more often than not,
struck the right balance in court intervention in arbitration. For instance, last
year the Supreme Court of India dispelled the (un)popular market perception
that two Indian parties contracting onshore cannot choose a foreign seat of
arbitration [PASL Wind Solutions v. GE Power Conversion India (2021) 7 SCC 1].
The judgment also raises doubts whether Indian substantive law is mandatory
for Indian parties arbitrating offshore. This landmark decision is likely to
accelerate the trend of Indian parties arbitrating abroad and provide comfort
to foreign investors contracting through onshore subsidiaries.
However, the Supreme Court of India’s approach to certain other issues in
arbitration has not been as favorable. For instance,
a) Banks and financial institutions are barred from arbitrating their financial
disputes in India and they are mandated to approach the Debt Recovery
Tribunal, a quasi-judicial body. [Vidya Drolia v. Durga Trading Corporation
(2021) 2 SCC 1]
b) The Supreme Court has refused to enforce the arbitration agreement
contained in an unstamped contract on the basis that, in circumstances
where the parties have not paid necessary stamp duty at the time of
execution, the matrix contract itself is void ab initio under Indian law.
[Garware Wall Ropes Ltd. v. Coastal Marine Construction & Engineering
Ltd (2019) 9 SCC 209]
c) It is not clear whether emergency awards in offshore arbitrations would
be enforceable in India. In Amazon.com NV Investment Holdings LLC v.
Future Retail [2021 SCC OnLine SC 557] the Apex Court held that an
emergency award passed in onshore arbitrations is enforceable in
India. The court buttressed this interpretation on the bulwark of party
* Rishab Gupta is an Advocate and Barrister at Twenty Essex. Lakshana R is a former
Associate at Shardul Amarchand Mangaldas & Co, Mumbai.

521
autonomy and the criticality of decongesting courts. Inarguably, these

considerations apply equally to offshore arbitrations, but the
enforceability paradox lingers on.
Such instances suggest that there are conflicting signals on India’s approach
to arbitration. Such conflicting signals are fertile ground for commentators,
who are often too quick to label any policy, practice, or precedent as either pro
or anti-arbitration. Such commentary is often reductionist and tends to
superficially focus on limited aspects, at the cost of a more nuanced and holistic
understanding. The terms often thrown around are—promoting, favoring, or
stifling arbitration and being friendly or unfriendly towards arbitration. These
are more often matters of evolving perception and perspective, and do not lend
themselves to concrete meanings.
In fact, it is open to debate whether these commentators share a common
understanding of the import of these terms. As Prof Bermann rightly argues, the
question of arbitration friendliness is essentially a trade-off, and it is important
to weigh all relevant factors. That balance and nuance however often eludes
mainstream commentators in India.
We take this opportunity to reflect on recent arbitration-related developments
in India, juxtaposing their various imports to highlight the indispensable trade-
offs. For the benefit of non-Indian readership, we provide a brief background
to the arbitration landscape in India. We weave in some thoughts on potential
issues thwarting India’s quest to become a major arbitration hub and a preferred
juridical seat. In essence, the issues plaguing arbitration in India are not unique—
they are pathological issues hindering the overall growth of the Indian economy.
I. AN OVERVIEW OF ARBITRATION IN INDIA
The Arbitration and Conciliation Act, 1996 (the “Act”) is the current
governing law for both domestic and international arbitration in India. It is
broadly based on the UNCITRAL Model Law. Part I of the Act mainly governs
domestic and international arbitrations seated in India. It also contains limited
provisions on interim relief and challenge, which apply to offshore arbitrations
as well. Part II of the Act deals with the enforcement of foreign awards and
mirrors the New York Convention 1958, which India is a signatory to. The Act
has been amended thrice so far—in 2015, 2019 and in 2021. Generally, the
amendments to the Act are considered pro-arbitration, in that their stated
objective (though not always their effect) is to reduce court intervention in
arbitration and make the arbitration procedure faster and cheaper.
It is not possible in this short article to discuss each aspect of the Act. That
is also not necessary. Instead, we focus on two aspects of the Act to illustrate
one simple and universal point: any amendment to arbitration law would be
(necessarily) both pro- and anti-arbitration.
INDIAN ARBITRATION 523
A. 2015 Amendment: Overhauling Interim Relief
The 2015 Amendment ushered in major changes to the court’s power to grant
interim relief, under Section 9 of the Act.
a) It inserted two new sub-sections in Section 9 to provide that, 1) arbitral

proceedings should be commenced within a period of 90 days-from the
date of the interim order; and 2) the court will not entertain an application
for interim relief after the arbitral tribunal has been constituted, unless
the circumstances render the remedy under Section 17 of the Act (i.e.,
interim relief from the tribunal) as ineffective or inefficacious.
b) It clarified that Section 9 proceedings may be initiated in support of
foreign-seated arbitrations unless the parties agreed otherwise.
c) It modified Section 17 of the 1996 Act to empower the arbitral tribunal
in onshore arbitrations to exercise powers analogous to the court’s
powers under Section 9 of the Act.
These amendments equip courts with very wide jurisdiction to grant interim
measures of protection in support of arbitration, whilst rationalizing court
intervention and equally empowering arbitral tribunals. These developments
are certainly responsive to users’ needs. However, they may not qualify as
purely pro-arbitration if we acknowledge the trade-offs. For instance:
a) Seeking interim relief before Indian courts in offshore or onshore

arbitrations means that the complexities of litigation in the Indian
courts (and the delays involved) will need to be navigated.
b) Interim relief orders (by courts or the tribunal) are subject to appeal
and the whole process could take several months (or more).
c) Further, confidentiality would be lost if a party is forced to pursue or
defend interim relief proceedings in open court. Unlike, for instance,
Singapore Courts, Indian Courts do not always seal the litigation records
to ensure confidentiality of a related arbitration proceeding.
B. 2019 and 2021 Amendments: Institutionalizing Arbitration
The 2019 Amendment seeks to champion institutional arbitration in India

and empowered the Supreme Court and the High Courts to designate certain
arbitral institutions and grade them. [Sections 11(3A) and 43-I] It also introduced
a novel concept of accreditation of arbitrators and disqualified non-Indians
from being accredited. This apparent deviation was widely criticized, before it
was promptly rectified in the 2021 Amendment to the Act. Under the current
regime, foreign arbitrators are eligible to be accredited, as and when appropriate
regulations are issued. [Section 43J]
It is promising that the judiciary and the executive are inclined to further
the aim of the amendments and promote institutional arbitration. For instance,
a) In November 2016, the Government of Maharashtra implemented the

“Policy for Arbitration as a preferred mode of dispute resolution”, which
mandated institutional arbitration in government contracts valued above
INR 50 million.
b) The Supreme Court of India has referred ad-hoc India-seated arbitrations
to the Mumbai Centre for International Arbitration (MCIA). [Arbitration
case (civil) nos.40 & 44 of 2019]
c) Indian courts have designated arbitral institutions as the appointing
authoring in several matters. [2017 SCCOnline SC 1200 and Arb.P.
180/2021]
Whilst these developments are certainly conducive to arbitration in a

general sense, they need to be put in perspective. Accreditation of arbitrations
and ranking of institutions, for example, are considered user-friendly initiatives.
However, accreditation and ranking can never be completely objective; lack of
objectivity, in turn, would raise questions about legitimacy of arbitration.
Similarly, while institutional arbitration is, on most counts, better than ad-hoc
arbitration, it is often more expensive and less flexible.
II. CONCLUSION
As the above analysis demonstrates, labelling a court judgment or a legislative

enactment as pro- or anti-arbitration is rarely accurate. As in any field of law,
arbitration-related statutes and policies involve trade-offs between competing
considerations. For example, a statutory amendment that reduces court
intervention (a worthy pro-arbitration value) may make arbitration procedure
more complex and therefore less efficient (undermining a different, but equally
important, arbitration value). To balance these competing interests, a cost-
benefit analysis is necessary to ascertain whether the contribution made by a
certain initiative to a pro-arbitration value is not less than the damage done to
a different value. Some of this can be done in advance. However, for the analysis
to be meaningful, it is necessary to have data points. And data points emerge
only after an initiative has been put in effect. It is necessary that those who
practice international arbitration actively share their experiences so that
developments that have an overall negative impact on arbitration can be
discarded expeditiously.
Chapter 95
BEING “PRO-ARBITRATION”:
AN ITALIAN PERSPECTIVE
Roberto Casati*
As brilliantly pointed out by Professor Bermann in his “What Does it Mean

to Be ‘Pro-Arbitration?”, the ways in which legislation, policies or practices may
affect international arbitration’s well-being are manifold and at times indirect
or even ambiguous: there exists in fact a multiplicity of metrics for identifying
what may be deemed to be “pro-” or “anti-arbitration”.
However, even considering the plurality and complexity of elements and
interrelations highlighted by Professor Bermann, there cannot be any doubts
as to the arbitration-friendly nature of the Italian legislative reform set to
apply starting from February 28, 2023.
I. THE REFORM OF THE ITALIAN REGULATION OF ARBITRATION
Indeed, prompted by the EU’s response to the adverse economic effects

caused by the pandemic, Italy’s Recovery and Resilience Plan, enacted in the
context of the recent NextGenerationEU program, contemplates, among its key
measures to reinforce the country’s economic and social resilience, a structural
reform of the Italian judicial system. The goal of this reform is primarily to
improve efficiency by shortening the duration of civil and criminal proceedings
and reducing the courts’ crowded dockets. This latter objective is also pursued
by recognizing in full the jurisdictional nature of arbitration proceedings.
In particular, the Law No. 206/2021 (see Article 1, para. 15), in line with the
Italian Supreme Court’s decision (sitting en banc) No. 24153/2013 and the Italian
Constitutional Court’s decision No. 223/2013, represents a definitive legislative
endorsement of the full jurisdictional and court-alternative nature of arbitration
under Italian law. This has been achieved by establishing parliamentary directives
that have been implemented by the Government through Legislative Decree No.
149/2022 amending the Italian arbitration legal regime, contained in Articles 806
and ff. of the Italian Code of Civil Procedure (the “ICCP”), with a view to
significantly and pervasively strengthening arbitration’s specific prerogatives.
In order to secure the result of more disputes being adjudicated by arbitration,
thereby softening pressure on the courts, the reform has moved into two main
directions: expanding the scope of the remedies that arbitrators may grant,
and, at the same time, enacting provisions aimed at improving trust in arbitration.
The most significant example of the former is probably the introduction of the
* Roberto Casati is a Partner at Linklaters and a Columbia Law School J.D. 1978 Graduate.
The author gratefully acknowledges the valuable contribution by colleague Francesco Amatori.
525
arbitral tribunals’ power to issue interim measures, while, as to the latter, the
impartiality and independence of arbitrators have been enhanced through the
introduction of a statutory duty of disclosure and the possibility to challenge
an arbitrator for material opportunity reasons (“gravi ragioni di convenienza”).
A. Interim Measures
The new legislation attributes to arbitral tribunals substantially the same

general power to issue interim measures as Italian national courts, provided the
parties have expressly consented thereto. This proviso may be regarded as an
indication of some residual mistrust or, on the contrary, as a recognition of the
parties’ freedom of choice, which is indeed the basis for arbitration. Such a power
will remain in the hands of national courts prior to the arbitrators’ acceptance of
their appointment, a provision that very wisely preserves the possibility of pre-
arbitration interim measures. In addition, national courts will have jurisdiction on
challenges to interim measures granted by arbitrators (allowed only on limited
grounds substantially mirroring grounds for annulment of arbitral awards), and
on the supervision on the enforcement of such measures.
This long-awaited amendment to Italian arbitration law has been welcomed,
as expected, with much enthusiasm by Italian scholars and arbitration
practitioners, who have strongly criticized for decades the Italian law’s
prohibition of arbitrator-granted interim measures. As is widely known, Italy
was one of the few European countries not to allow arbitral provisional relief,
either prior to or during arbitration proceedings. (For the position of other
European jurisdictions see, among others, Article 1468 of the French Code de
Procédure Civile, Article 39 of the English Arbitration Act, Article 183 of the
Swiss Federal Act on Private International Law, Article 1041 of the German
ZPO, and Article 23 of the Spanish Ley 60/2003 de Arbitraje.)
This prohibition (crystallized in former Article 818 ICCP) has traditionally
been justified based on the argument that, since under Italian law arbitral tribunals
are not empowered to render immediately enforceable awards for lack of the
power of coercion (so-called imperium) required to command public authorities to
physically enforce the legal rule established by the arbitrators (e.g., even national
awards require exequatur by the competent Court of Appeal), such tribunals could
not order interim measures unless expressly provided for by the law.
Most of the scholars, however, have argued that, as arbitrators are granted the
power to render final awards having the same effect as national courts’ judgments
(as per Article 824-bis ICCP), such power should a fortiori include the authority to
grant provisional relief. In addition, the Italian legal system already provided for
the arbitrators’ power to issue interim measures in certain limited instances (i.e.,
in case of orders to suspend the efficacy of shareholders’ resolutions pursuant to
former Article 35, para. 5 of Legislative Decree No. 5/2003).
As a result of the above arguments, the preservation of the prohibition under
Article 818 ICCP has ultimately been deemed to be a consequence of a mere
policy choice by the lawmaker based on a lack of confidence on arbitration and
BEING “PRO-ARBITRATION”: AN ITALIAN PERSPECTIVE 527
its reluctance to give it full equivalence with national court proceedings.

Therefore, Italian scholars and arbitral institutions have attempted to construe
this ban restrictively, arguing for the arbitrators’ possibility to issue, subject to
the parties’ consent, “determination[s] of [a] provisional nature with binding
contractual effect upon the parties.” (See, for instance, Article 26 of the Arbitration
Rules of the Milan Arbitration Chamber (CAM).)
This unnecessarily anomalous situation seems to have come to an end. In
fact, as noted, the new legislation confers on arbitral tribunals the general
power to issue interim measures, thus improving the efficiency and
effectiveness of proceedings, as well as minimizing the risk of potential
inefficiencies or unfairness, by (i) allowing the same authority having
jurisdiction on the merits of the dispute to grant any related provisional relief
and, as a result, (ii) reducing the probability of conflicting or unaligned
decisions rendered in different phases of the proceedings.
This part of the reform undoubtedly represents a big step towards a more
“pro-arbitration” Italian legal system—at least within the “classical” meaning of
the term, i.e., using Professor Bermann’s words: a system where “the features
of” the relevant “arbitration regime, viewed in the aggregate, […] sufficiently
advance arbitration’s purposes”, generally captured by the terms “accuracy,
fairness, and efficiency and an enforceable award”.
However, it would have certainly been desirable for the wording of Legislative
Decree No. 149/2022 to provide more clarity on certain aspects of the new rules.
Matters which would have deserved further attention include, among others: the
identification of or clarification on the regime applicable to measures granted in
emergency arbitrations, as well as the issue whether interim measures may be
binding on persons who are not parties to the arbitration proceedings.
Notwithstanding the above, the implementing legislation has resolved ab
origine some significant hermeneutic dilemmas. For instance, Law No. 206/2021
required all the parties to express their consent in writing to allow arbitrators to
grant interim measures, giving rise to doubts as to whether the implementing
measures may provide for consent by way of reference to an arbitral institution’s
rules. In response, Legislative Decree No. 149/2022 explicitly provided that such
a (pre-arbitration commencement) consent may indeed be given also by way of
reference to arbitral institution’s rules (see new Article 818 ICCP).
In any event, this written consent requirement may create a de facto
obstacle to the application of the new rules to ad hoc arbitrations, which
represent a significant—if not altogether the greater—component of Italy’s
In any case, this crucial paradigm shift—together with the arbitration law
reform as a whole—is certainly expected to be considered by the international
arbitration community as a decisive element for Italy to bridge the gap with other
(at least so far) more arbitration-friendly jurisdictions, thereby increasing Italy’s
international competitiveness (both as a potential seat of arbitration and,
ultimately, also as a country to invest in).
527
B. Arbitrators’ Independence and Impartiality
The same goes for the second main aspect of the reform, focusing on
enhancing trust in arbitration by strengthening the impartiality and
independence of arbitrators. This is achieved (i) by making mandatory by law
for arbitrators to submit, at the time of acceptance of their appointment, a
declaration covering all factual circumstances relevant for the purposes of
their impartiality and independence; and (ii) by expanding the grounds upon
which an arbitrator’s appointment may be challenged.
Although the requirement sub (i) was already set out in the rules of major
Italian arbitral institutions (see, for instance, Article 20 the CAM Arbitration
Rules) and is also contemplated by other national arbitration laws (see, for
example, Article 1456(2) of the French Code de Procédure Civile and Article 15
of Ley 60/2003 de Arbitraje), it will now apply also to ad hoc arbitrations and
failure to submit the declaration will make the arbitrator’s acceptance invalid.
Moreover, failure to declare a circumstance that could be invoked as a ground
for challenging an arbitrator will entail parties’ power to apply for the
forfeiture of the appointment (decadenza).
Furthermore, an additional, quite significant ground for challenging an
arbitrator has been reinstated (after having been eliminated by the previous
2006 Italian arbitration law reform—see Legislative Decree No. 40/2006). As
noted above, it will in fact be possible to challenge an arbitrator’s appointment
in case of material opportunity reasons (“gravi ragioni di convenienza”)
capable of affecting such arbitrator’s independence or impartiality, a quite
fact-based and, as will be seen below, somehow subjective standard.
The lawmaker’s intent behind this amendment is made clear by the Italian
Parliament’s official report on the reform dated October 18, 2021: the goal is
to increase the system’s transparency and the potential arbitration users’ trust
in arbitration by establishing a duty to disclose all factual circumstances that
may undermine an arbitrator’s independence and impartiality, even if only in
the perception of the parties (“anche soltanto nella percezione delle parti
stesse”)—this last clarification being very useful to understand, at least in part,
the actual contents of the disclosure obligation at hand.
It is worth mentioning, in this respect, that the Italian legal system already
provided for a similar duty of disclosure on a lawyer, when acting as an
arbitrator. Article 61(3) of the Italian lawyers’ Code of Conduct (“Codice
Deontologico”) establishes in fact that a lawyer-arbitrator must disclose to the
parties any factual circumstance and any relationship with the parties’ lawyers
that may affect his/her independence.
As is well-known in the arbitration community, it would be naive to assume
that a disclosure obligation only at the time of acceptance of the appointment
would be enough to ensure an arbitrator’s impartiality and independence. In fact,
as set out by the best international standards, the arbitrators’ “duty of disclosure”
is to be “ongoing in nature” and effective for the entire duration of the proceedings.
BEING “PRO-ARBITRATION”: AN ITALIAN PERSPECTIVE 529
(See, among others, the IBA Guidelines on Conflicts of Interest in International

Arbitration, General Standard 3.) In light of the above, the new legislation provides
for the arbitrators’ duty to renew their disclosure statement in case of change in
the circumstances on the basis of which the original one was made.
That said, while the goal behind these new provisions is entirely
commendable, there appears to be quite some room for improvement. For
instance, some objections may be raised in relation to the broad wording used
in identifying the subject matter of the disclosure. Indeed, for the arbitrators’
disclosure to be effective and reliable, it is generally believed that its contents
need to be clearly identified from the start in order to provide the disclosing
arbitrator (and the parties) with certainty over what has (and what does not
have) to be investigated and disclosed to be in compliance with the applicable
standard of impartiality and independence. This is the reason why the
abovementioned IBA Guidelines on Conflicts of Interest in International
Arbitration and other similar instruments were created and are currently so
successful. Therefore, it probably would have been advisable for the reform-
implementing enactments to focus more on a better identification of the
circumstances (i) to be considered relevant for the purposes of an arbitrator’s
impartiality and independence (i.e., the subject-matter of the duty to disclose);
and (ii) to invoke as “material opportunity reasons” in order to lead to the
relevant arbitrator’s removal if not disclosed. On the other hand, as is well
known, specificity and details in legislative drafting are often at the expense of
substance, as they are incompatible with a self-adapting, broad coverage and
very often cause unintended results and, always, significant loopholes.
That said, while the reform is unquestionably “pro-arbitration” (the same
providing, inter alia, also for the explicit recognition of the immediate
enforceability of decrees recognizing the effectiveness of foreign awards in Italy),
its actual, practical impact and effectiveness will—as wisely observed by
Professor Bermann—inevitably need the involved “actors to take positions and
adopt practices that are favourable to the arbitration enterprise” (which, according
to the view of the first commentators of the reform, would probably require some
kind of tax incentives to be added to the mere legal amendments at hand).
C. Other Aspects
In any case, one should point out that, even before this latest reform, Italy’s
qualification as an arbitration-friendly jurisdiction (under the multiplicity of
metrics identified by Professor Bermann) could not be questioned.
Indeed, leaving aside the most common and relatively obvious cases of
“classical” pro-arbitration provisions contained in Italy’s arbitration law, the latter
offers quite a few examples of a sound balance both among pro-arbitration
considerations and (even more so) among these latter considerations and
“important values that are largely external to international arbitration itself”—
that, as Professor Bermann would point out, when correctly dosed in the
529
management of the trade-offs among relevant considerations, “enhance

international arbitration legitimacy overall”.
More specifically, having regard to some of the areas indicated by
Professor Bermann, Italian law on arbitrator immunity does not limit itself to
defining said immunity through the mere use of concepts such as “bad faith”
(see, ex multis, Article 29 of the English Arbitration Act) and/or “recklessness”
(see Article 21(1) of the Spanish Ley 60/2003 de Arbitraje). Instead, Italian law,
in managing the tension between the traditional pro-arbitration value of ensuring
that arbitrators operate without fear of reprisals, and the extrinsic value of
accountability, provides (in a more precise and articulate way) that an arbitrator
shall be liable for damages to the parties if he/she has fraudulently (dolo) or
with gross negligence (colpa grave): (i) omitted or delayed an action due under
his/her office (and essential for the purposes of the prosecution of the
proceedings), and was consequently removed; (ii) resigned without just cause;
(iii) omitted or prevented the rendering of the award within the applicable
time-limit; or (iv) committed an action sanctioned by the Italian statutory
regime on the liability of national judges, thus aligning the two adjudicating roles.
(See Article 2, para.s 2 and 3, Law No. 117/1988.)
In all the above instances, however, except sub items (i) and (ii), an action
for damages can be initiated only after a judgment has voided the award, in
whole or in part (i.e., it cannot be brought during the arbitral proceedings), and
only based on the same grounds as were the reason for the voidance of the
award, thus preventing that such an action could be used for ulterior motives,
as a means to influence an arbitrator’s decision. In addition, except in the case
of fraud, the law puts a cap on recoverable damages, which cannot exceed three
times the fees that would have been due to the arbitrator (Article 813-ter ICCP).
A similarly sound balance can be found in Article 819-bis ICCP, pursuant to
which, in case of a preliminary issue affecting a claim brought before an arbitral
tribunal, the arbitrators must stay the proceedings only if such an issue regards
a subject matter that is non-arbitrable and must be decided ex lege by a final
ruling binding upon the parties with the force of res judicata. In other words,
in order to maximize time efficiency of the proceedings, arbitrators are granted
the power to entertain incidenter tantum not only issues that are not included
in, but also issues that—under Italian law—cannot fall within, the scope of the
relevant arbitration agreement. (See also Article 819 ICCP.) On the other hand,
as a result of the abovementioned balancing, in instances where the conflict
occurs between the advisability to minimize the duration of arbitration
proceedings and the extra-arbitration need for certain decisions to be rendered
by national courts (for instance, decisions on an alleged forgery of a notarial deed,
to be decided with the force of res judicata), the arbitration has to be suspended.
Chapter 96
THE ARBITRATION STATE: FROM AUTONOMY TO
INDEPENDENCE
Rumen Cholakov*
“The opposite of law is not chaos, it’s arbitration.” This punch line from the
Columbia Law School Law Revue musical performance in 2020 stuck in my
mind and I often quote it as a joke to friends and family, though only my legally
trained friends get the joke (my family is still very confused). Of course, the joke
was on us: those pro-arbitration zealots sitting in one of Professor Bermann’s
many popular classes (I took International Commercial Arbitration). The image
of us listening to the Law Revue’s witty tunes, therefore, was a synecdoche of
the age-old paradigm of what happens when the pro-arbitration community
encounters anti-arbitration dogma.
I am Bulgarian by origin and we have a saying that is very telling of the
Bulgarian national spirit: “Too good is not good!”. None of Professor Bermann’s
students has failed to appreciate the perspective that, likewise, some things that
seem too pro-arbitration may not in fact be good for arbitration. However,
Professor Bermann also coined a unique analogy: that of arbitration as a
“separatist political movement” seeking its “independence from whatever regime
of which it would otherwise be part.” In this short contribution dedicated to
Professor Bermann, I would like to explore (i) whether the ultimate
independence—arbitration statehood—is possible and (ii) whether creating
an arbitration state in fact would be pro-arbitration.
I. IS THE ARBITRATION STATE POSSIBLE?
What do I mean by “arbitration statehood”? Put simply, it is the incorporation

of arbitration as the sole system of civil dispute resolution within a sovereign
state—without any courts and judges. At first blush, this is a radical idea. But
over the past two decades, global disputes have seen the emergence of a
different phenomenon that previously also would have seemed radical: the
incorporation and application of one state’s legal system into another. The
trailblazer was the Dubai International Financial Centre (DIFC), established in
2004, and its DIFC Courts. The DIFC is a special economic zone within the
Emirate of Dubai, which has its own legal system based on the English common
law and adjudicated by esteemed former members of the English judiciary,
* Rumen Cholakov is a Barrister at 3 Verulam Buildings in London, UK. He specialises in
banking disputes, complex civil fraud cases, and international arbitration. Rumen is also a
member of the New York Bar.
531
including the current Treasurer of Gray’s Inn and former Court of Appeal
judge, Sir Peter Gross.
The model first tried in the DIFC has been repeated in other places,
including Kazakhstan (the Astana International Financial Centre, “AIFC”),
Singapore (the Singapore International Commercial Court) and the Emirate of
Abu Dhabi (the Abu Dhabi Global Market, “ADGM”). All of these courts have the
jurisdiction to hear civil disputes within the ambit of their territorial scope,
have independent judiciary comprised of international members (the AIFC
boasts that it has given rights of audience to lawyers from 29 jurisdictions),
and issue enforceable judgments. Does that sound at all familiar to you if you
are one of my fellow pro-arbitration zealots?
What I find remarkable is the legislative simplicity, with which such an
incredibly complicated constitutional structure was implemented. Article 121
of the UAE Constitution allowed for the provision of federal law with respect
to the operation of financial free zones. Federal Law No. 8 of 2004 then
provided in Article 3(2) that: “These zones and Financial Activities shall also
be subject to all federal laws with the exception of federal civil and commercial
laws” (emphasis added). With respect to the ADGM, this exception was filled
in by the creation of the ADGM Courts by virtue of one sole Article 13 in Law
No. (4) of 2013 (as recently amended by Law No. (12) of 2020) and the
enactment by the Board of Directors of ADGM of the Application of English Law
Regulations 2015, which stated in essence (though with certain caveats and
“small print” that followed) that: “The common law of England (including the
principles and rules of equity), as it stands from time to time, shall apply and
have legal force in, and form part of the law of, the Abu Dhabi Global Market.”
And hey presto, you have English law! What this means is that someone
going to Abu Dhabi to marvel at the magnificence of the Sheikh Zayed Grand
Mosque could take a quick detour to Al Maryah island (where the ADGM is
located) and conclude a perfectly valid oral contract under English law that
could then be enforced in the ADGM courts currently heralded by the former
United Kingdom Supreme Court judge, The Right Honourable Lord David Hope
of Craighead KT.
What the exportation of the English legal system to the ADGM in such a
straightforward manner suggests, is that our future will unfold novel and
creative legal-constitutional structures, sometimes in surprising locations.
And they may not even be limited just to the civil law. The Kingdom of Saudi
Arabia is marsha ling great resources to build Neom, a city of the future, where
all indications suggest that a yet more interesting Anglo-Saxon system of law
will be created. What if this were a system of arbitration, rather than litigation?
Imagine that, in a similar fashion to the Abu Dhabi legislation, a sovereign
state decided to create a financial center where all disputes (aside from crime)
would be referred to arbitration (the “Arbitration State”). This could be any
type of arbitration agreed by the parties or, absent agreement, referred to a
default arbitration centre within the financial enclave. I am confident that, at
THE ARBITRATION STATE: FROM AUTONOMY TO INDEPENDENCE 533
this point, many will stop me and immediately remind me what Professor
Bermann taught us in his first class—to quote my own notes verbatim: “No
arbitration without the prior consent of the parties” and “Parties are the architects
of their own arbitration” (with my original emphasis). So is what I am proposing
not just a different name for a court of law? Not quite.
The main features of litigation that are distinct from arbitration appear to
me to be (i) the backing of the full power of the state, (ii) rigid rules of procedure,
(iii) no ability to select the judges, and (iv) the judges are free (the taxpayer
pays for them, rather than the parties), though courts do charge various fees.
In the Arbitration State, the latter three could be easily distinguishable. The
rules of procedure would be those of arbitration, parties would be allowed to
select members of the tribunal (either by agreement or by default), and in a
sophisticated financial centre it is not radical to suggest that they also will pay
for the remuneration of the arbitrators (with all other methods for assisting
claims, including “After The Event” insurance, available as they are in any other
arbitration).
It is only the coercive power of the state that causes trouble. In order to
dispense altogether with the role of the arbitral seat and its “supervisory”
powers, the Arbitration State would need to equip its arbitrators with the ability
to (i) come to a final determination on how the arbitration agreement is to be
interpreted, and (ii) compel the parties to follow the decisions of the tribunal.
However, jurisdictional issues fall away by definition—parties within the
Arbitration State will have agreed to arbitrate by default, while the arbitral
tribunal will have full Kompetenz (without the -Kompetenz) to interpret any of
their specific agreements. And coercive powers could be given to the arbitrators
(do I now gain more support among the arbitration community?) when it comes
to enforcement. There is no obvious reason why an arbitral award could not be
treated, within the parameters of the Arbitration State, with the same authority
and consequences as a decision of a court of law.
It can be argued that mandatory arbitration in fact increases party autonomy.
The default position for parties who have not provided for their own arbitration
outside the Arbitration State is litigation, over which parties have no control.
Default arbitration, on the other hand, could allow the parties to retain significant
autonomy by comparison, particularly over the selection of party-appointed
arbitrators and procedural decisions. In both cases, the arbitral awards could
enjoy the freedom of mobility provided by the New York Convention, especially
if an argument is recognized that parties deciding to do business in the Arbitration
State give their consent to arbitration by implication, thereby precluding any
jurisdictional challenges to enforcement. The same approach could be applied
to the merits. Parties would be free to choose the applicability of any law to
their underlying relationship. Failing that, the Arbitration State could set a
preferred default law, in a similar way as to how the ADGM has incorporated
English common law and practice.
There are no obstacles to an appellate procedure being put in place. Such

can be provided for by the parties, or as a default rule within the Arbitration
State. Again, there is a minimal difference to current practice. Some legal tech
start-ups have gone even further. The virtual court Kleros allows parties to
continue appealing by increasing the number of judges in each round until the
final limit is reached, as long as they are prepared to pay for the increasing costs.
With independence and power comes responsibility. Arbitral tribunals within
the Arbitration State would have to determine issues of conflicts of law, privilege,
anti-suit injunctions, and comity, to name but a few. This is no different from
ordinary practice and, to quote Professor Bermann again, it should “come as
no surprise that over time tribunals have asserted the freedom to make
determination[s] of this kind independently, untethered from local law and
practice.” The increased wealth of international practice and the emergence of
international standards would assist in this regard.
The Arbitration State is a conceptual proposition, rather than a blueprint.
Many aspects would need fine-tuning and detailed consideration. What seems
increasingly clear, however, is that the Arbitration State is ready to jump from
the confines of the theoretical into the realm of the real and possible. The
ADGM, DIFC, and similar projects have provided the stepping stone for its
emergence. The question that remains is the proverbial one: is the Arbitration
State pro-arbitration?
II. IS THE ARBITRATION STATE PRO-ARBITRATION?
The obvious answer surely is yes. The Arbitration State would be the
culmination of the “separatist movement’s” efforts to be freed from the last
confines of judicial oversight and control. Perhaps it can be said that it would
even elevate arbitration to a higher status, one of stately grandeur as a
constitutional pillar within a sovereign jurisdiction (or at least a zone within it)
that is indispensable to its legal persons, whether they be individuals or entities.
The Arbitration State would create novel opportunities for the arbitration
community to develop its practice and no doubt this innovation will lead to
exponential gains that could be employed internationally outside the boundaries
of the Arbitration State.
There are, however, some limitations and uncertainties that could lead to
a different interpretation. Arbitration’s popularity and attraction always have
been its rooting in the freedom of choice. It is in a sense a capitalist alternative
to relying on the state for the provision of justice, grounded in the “laissez-
faire” idea that the market can do it better. If the Arbitration State imposes it as
a default, this attraction could fade and be replaced with the natural rebellious
instinct of humans to reject or at least question that which exists by obligation;
or yet worse, it could nurture a nostalgie for litigation.
Arbitration is also private and confidential. This aspect directly contravenes
the jurisprudential principle of openness and transparency, where every citizen
THE ARBITRATION STATE: FROM AUTONOMY TO INDEPENDENCE 535
is allowed to watch the process of the courts. What happens behind closed
doors breeds mistrust and anecdotal evidence passed on from mouth-to-
mouth (or lawyer-to-lawyer) could become the main source for the reputation
of the Arbitration State. Its reputation, therefore, would depend very much on
the quality of the arbitrators—they must be the best of the best. Indeed, the
most difficult challenges for the Arbitration State could be posed by ensuring
the accountability and oversight of arbitrators. Due process challenges would
require some independent body to review and scrutinize the tribunals and
such a body risks becoming a “court” for all intents and purposes.
The Arbitration State is also unsuitable for just any society and jurisdiction.
Criticisms of consumer arbitration are well-known and not without merit.
Small claims do not lend themselves naturally to arbitration, though perhaps
there would be a way to innovate in this direction. Criminal law would need to
retain the system of the courts. The Arbitration State, therefore, would be
suitable in offshore or special economic zone-type jurisdictions that typically
attract major commercial litigation. And it would need to limit its authority to
civil disputes.
Professor Bermann suggested twelve criteria as a “non-exhaustive catalogue”
to gauge whether a policy is pro- or anti-arbitration. The Arbitration State
undoubtedly scores highly in some of these criteria, such as: minimizing the
intervention of national courts, ensuring that the award will withstand annulment
or enforcement challenges, and expanding the legal claims treated as arbitrable.
It scores rather poorly in others: protecting a party’s right to be heard (due to
higher access costs vis litigation), promoting accuracy in the administration of
justice (due to confidentiality), and mostly in ensuring consent to arbitrate,
though it could be said that it does enhance the scope of party autonomy
because more issues become arbitrable and therefore within the ambit of the
parties’ chosen type of arbitration where one is selected. On the remaining
criteria, it is probably of neutral or limited effect. What weighting should be
given to each factor is, of course, a matter of debate.
Some evergreen tensions between the judicial system and arbitral practice
would be resolved. One is the availability of interim relief—it would be mandated
by the arbitrators directly. Another is the extension of arbitration agreements
to non-signatories—if they fall within the jurisdiction of the Arbitration State
(by reference to its default law or the law chosen by the parties), they ought to
be joined in. Class actions and punitive damages simply become arbitrable and
no more “second looks” at competition cases.
But arbitration is mostly an international phenomenon. The question of
finding jurisdiction over parties outside the Arbitration State could be
exceptionally difficult and thus limit the ambit of its usefulness. To unlock and
reap the real benefits of arbitration, recognition and enforcement under the
New York convention is a must and it is unclear whether the Arbitration State
would be allowed as a signatory. The Arbitration State, therefore, risks remaining
localized and isolated.
III. CONCLUSION
The centenary of the passing of the Federal Arbitration Act 1925 is almost
upon us. Much ink has been spilled on the need for updating this document,
though it has aged well for its time. Yet, it is undeniable that legal innovation
has flourished over the past two decades. Despite some significant setbacks,
global interconnectedness marches forward and new commercial centers spring
up, fuelled by easy mobility and eagerness to attract the capital and enterprises
of our ever-growing population. What was once legal fiction may well be upon
us. Because, at its core, all law is fiction—some have even compared it to magic!
If I have to make a prediction that in 2025 we could be celebrating not just the
centenary of the FAA, but also the birth of the Arbitration State, this would be
ambitious and unlikely to come true. But it does not seem impossible. And for
that, the credit goes to the efforts and successes of all distinguished arbitration
practitioners, not least among them Professor Bermann.
Chapter 97
PRO-ARBITRATION AND “PRO VALIDITATE”:
IS IT ALWAYS THE SAME? SOME REFLECTIONS
IN LIGHT OF SWISS AND FRENCH LAW
Sébastien Besson*
In his inspiring article on “What Does it Mean to Be ‘Pro-Arbitration’?”,

Professor Bermann stressed that there are “multiple gauges” for determining
the “pro-” or “anti-” arbitration character of a given policy or practice, and
proposed a “non-exhaustive catalogue” of twelve criteria to conduct that
assessment, among which the question “to what extent does it ensure consent
to arbitrate and enhance the scope for party autonomy?”
Consent to arbitrate is established under the law(s) governing the arbitration
agreement. Such laws normally aim at ensuring and giving effect to the parties’
autonomy to enter into an arbitration agreement. The parties’ autonomy itself
is, however, not necessarily pro-arbitration; it is what the parties actually
want, and this may or may not be in favour of arbitration.
Thus, ensuring the validity of the arbitration agreement and enhancing
party autonomy do not necessarily work in tandem. For instance, the parties
may exercise their autonomy by choosing a particular law to govern their
arbitration agreement, and the law so chosen may have an adverse impact on
the validity of that very agreement.
More generally, the determination of the law or laws governing the arbitration
agreement is an interesting topic to test “what it means to be pro-arbitration”.
Indeed, some legal systems promote the idea that a “pro validitate” approach
vis-à-vis the arbitration agreement is necessarily “pro-arbitration”, even if this
comes at the expense of the parties’ intentions or expectations.
With this in mind, I propose to discuss the issue of the law governing the
arbitration agreement under the Swiss and French legal systems, which are
well known for their pro-arbitration stance, to identify the possible tensions
with the principle of party autonomy and the potential practical difficulties
these approaches may entail.
To frame the discussion, it is important to start by examining the concept
and ambit of the “law governing the arbitration agreement.”
* Sébastien Besson is Partner at Lévy Kaufmann-Kohler in Geneva. The author gives thanks
to Erika Hasler for her invaluable assistance.

537
I. THE CONCEPT AND SCOPE OF THE LAW(S) GOVERNING THE

ARBITRATION AGREEMENT
The expression “law governing the arbitration agreement” is commonly used

and apparently clear, but it conceals a great deal of ambiguity—specifically on
the core question of exactly what issues are governed by the law (or laws)
applicable to an international arbitration agreement. It is widely recognised
that certain issues fall outside the scope of the law “governing the arbitration
agreement” and are thus governed by a—possibly but not necessarily—different
law. The arbitrability of the subject matter of the dispute, the capacity of the
parties (including States) to enter into an arbitration agreement, or the authority
of the parties’ representatives are typically excluded from the scope of the law
“governing the arbitration agreement.”
A closer examination reveals that the scope of that governing law is not the
same in all jurisdictions. The determination of the personal scope of application
of the arbitration agreement is an interesting example. In Switzerland, it appears
to be well settled that the law governing the arbitration agreement applies to
determine whether the arbitration agreement extends to third persons.
Elsewhere, the issue remains debated. For instance, in England, several
different possibilities are envisaged in the case law and scholarly writings (law
of the contract, law of the arbitration agreement, or even other law(s) determined
to be applicable under the relevant private international law rules (Merkin &
Flannery, The Arbitration Act 1996, 6th ed., 2020, Routledge, pp. 523–524)).
Acknowledging the differences across jurisdictions and the resulting difficulties
in this regard, Professor Bermann has noted that: “[p]erhaps the better, if still
more complex, approach is to first identify the doctrine on the basis of which
extension of the agreement to non-signatories is asserted, and then decide
which law best governs the issue” (Bermann, International Arbitration and Private
International Law, Collected Courses of the Hague Academy of International Law,
Vol. 381, Brill, 2017, p. 162).
Given the space constraints, this strand of the discussion will be left out
here, to focus on the law governing formation and validity (stricto sensu) of the
arbitration agreement.
II. THE NEW YORK CONVENTION (NYC)
Art. II of the NYC makes a distinction between the form and the other
(substantive) conditions related to the formation and validity of the arbitration
agreement.
The form requirement is set out in Art. II(2), which provides an autonomous
definition of what “in writing” means. No conflict of laws analysis is required
for this issue, as the NYC gives the answer. The form requirement is applicable
both at the stage of enforcement of the arbitration agreement and at the stage of
PRO-ARBITRATION AND “PRO VALIDITATE”: IS IT ALWAYS THE SAME? 539
the recognition and enforcement of the award (R. Wolff, New York Convention
– Article by Article Commentary, 2nd ed., Beck, 2019, ad Article II, para. 39).
Turning now to the substance, Art. V(1)(a) of the NYC subjects the other
conditions relating to the formation and validity of the arbitration agreement
to a conflict of laws analysis. It provides that the recognition and enforcement
of the award may be refused if the arbitration agreement “is not valid under
the law to which the parties have subjected it or, failing any indication thereon,
under the law of the country where the award was made.” This provision is
also applicable, at least by analogy, at the stage of the enforcement of the
arbitration agreement (S. Wilske/T. Fox, in R. Wolff, op. cit., paras. 228–230).
The identification of the “law to which the parties have subjected [the
arbitration agreement]” has led to debate. In particular, it is controversial whether
a general choice of law clause contained in the contract extends to the arbitration
agreement. The trend, at least in common law jurisdictions, appears to be that
“absent a choice of law in the arbitration clause itself, a general contractual
choice-of-law clause was intended to apply to the arbitration clause as well”
(ALI, Restatement of the Law - The US Law of International Commercial & Investor-
State Arbitration, Proposed Final Draft, 2019, p. 257).
The law “of the country where the award was made” is today almost
universally interpreted as referring to the law of the seat of the arbitration. This
connecting factor is easy to apply at the stage of the recognition and enforcement
of the award. For the enforcement of the arbitration agreement, difficulties
may arise, for instance, when the seat is not indicated.
The conflict of laws provision in Art. V(1)(a) of the NYC is framed in alternative
terms, with the law of the seat coming into play only in the absence of a choice of
law made by the parties (expressly or impliedly) to govern the arbitration
agreement.
The law governing the arbitration agreement under Art. V(1)(a) of the NYC
may be displaced in the circumstances envisaged under Art. VII(1), which entitles
a party to “avail himself” of a more favorable provision of another international
treaty (which is rare) or of a domestic law (which is more frequent) at the place
of enforcement.
Thus, except in circumstances where Art. VII(1) comes into play, the NYC gives
primacy to the autonomy of the parties who are free to “subject” the arbitration
agreement to the law of their choice, but for the form requirements that are
directly laid down in Art. II(2) of the NYC.
III. SWISS LAW (THE “IN FAVOREM VALIDITATIS” APPROACH)
In Switzerland, the form of the arbitration agreement in international

arbitration is governed by Art. 178(1) of the Private International Law Act (PILA),
which provides that such an agreement “shall be valid if made in writing or any
other manner that can be evidenced by a text.” Similar to Art. II(2) of the NYC,
this provision is not a conflict rule but rather a substantive rule of private
international law that directly provides the answer to the question at stake.
Art. 178(1) of the PILA’s standards are not as demanding as those of Art. II(2)
of the NYC, in particular because the former does not require a “signed”
document or an “exchange” of written documents. However, Art. 178(1) of the
PILA is mandatory in the sense that the parties cannot waive or further relax
its form requirements. On the other hand, the Swiss Federal Tribunal (SFT) has
suggested that the parties could subject their arbitration agreement to stricter
form requirements (e.g., a signed document; ATF 142 III 239, para. 3.3.1).
The substantive requirements applicable to the arbitration agreement are
laid down in Art. 178(2) of the PILA, which provides that “as to its substance”
an arbitration agreement is valid “if it conforms to the law chosen by the
parties, or the law governing the subject-matter of the dispute, in particular
the main contract, or to Swiss law”. This provision is a specific conflict of laws
rule. It significantly differs from Art. V(1)(a) of the NYC because it identifies
three possible laws that can all be applied to the formation and existence of the
arbitration agreement. The connecting factors are said by the SFT to be “in
favorem validitatis” and without any hierarchy, such that the arbitral tribunal
can establish its jurisdiction on the basis of any one of the laws designated by
Art. 178(2) of the PILA, even if the others would result in the invalidity of the
arbitration agreement. For example, if the law chosen by the parties to govern
the contract invalidates the arbitration agreement, the arbitral tribunal could still
assume jurisdiction by applying Swiss law. It has been stated that Art. 178(2)
of the PILA “reflects the Swiss legislator’s pro-arbitration bias, i.e. Switzerland’s
policy to support the validity of the arbitration agreement as much as possible”
and that it “also aims to ensure predictability and to reduce challenges of an
award” (D. Girsberger/N. Voser, International Arbitration – Comparative and
Swiss Perspectives, 4th ed., 2021, para. 356).
Irrespective of the good intentions that led to this provision, its functioning
may result in uncertainties and difficulties.
First, it is unresolved if the conflict rule of Art. 178(2) of the PILA is
mandatory or optional. It is hence not clear if the parties, in the exercise of
their autonomy, could choose to subject their arbitration agreement to only
one law. We have encountered the following clause in the context of a Swiss-
seated arbitration: “this arbitration agreement shall be interpreted solely in
accordance with the laws of Switzerland, without application of any conflict or
similar rules that would require the application of other laws”. The clause was
manifestly intended to ensure that only one law would govern the arbitration
agreement. In this particular example, Swiss law had been chosen, which
renders the example less interesting than if a foreign and restrictive law had been
chosen. But in the latter case, what would be the impact of this contractual
choice of law clause specific to the arbitration agreement? Would it prevail
over Art. 178(2) of the PILA or, assuming that choice would invalidate the
arbitration agreement, would the arbitral tribunal remain entitled to refer to
the other laws designated in that provision, in particular Swiss law, to establish
its jurisdiction?
Secondly, the scope of application of Art. 178(2) of the PILA raises difficulties,
which have only been alluded to by Swiss scholars and remain unanswered in the
case law. The provision addresses the requirements applicable to “the substance”,
as opposed to the form, of the arbitration agreement. Such requirements concern
undoubtedly the process of formation (exchange of offer and acceptance) and
its impact on the validity of the arbitration agreement (e.g., in the event of alleged
defects such as error, duress or threat). However, the first commentators of
the PILA, including influential authors like Pierre Lalive, Jean-François Poudret
and Claude Reymond, attributed a broader scope of application to Art. 178(2)
of the PILA, extending it to issues of interpretation, scope (including ratione
personae), effects, extinguishment or termination of the arbitration agreement.
Thus, “in favorem validitatis” became the guiding principle to resolve a wide
range of issues related to the arbitration agreement. Yet, this principle is difficult
to apply, or even conceive of, in respect of issues that do not pertain to the
arbitration agreement’s formation and validity stricto sensu. For instance, how
should Art. 178(2)’s conflict rule apply to the termination of the arbitration
agreement? Would a party that believes it is entitled to terminate the agreement
be obliged to comply with all three of the laws designated in Art. 178(2) of the
PILA (assuming they are not the same), and thus, have to follow the required
paths for terminating the agreement under all of those laws? What happens if
those requirements are conflicting?
Thirdly, the in favorem validitatis principle may result in discrepancies in
the assessment of the validity of the arbitration agreement and, hence, of the
arbitral tribunal’s jurisdiction. If the arbitration clause is invalid under the law
expressly chosen by the parties, but valid under Swiss law, an arbitral tribunal
sitting in Switzerland will apply Art. 178(2) of the PILA and assume jurisdiction,
and, in the event of a challenge of the award in Switzerland, the SFT will also
apply Art. 178(2) of the PILA and will accept the reasoning of the arbitral tribunal.
The award will hence be valid and enforceable in Switzerland.
By contrast, if the enforcement of that same award were to be sought
elsewhere, the award may not be recognised and enforced because the party
resisting enforcement will be entitled to rely on Art. V(1)(a) of the NYC and would
be able to demonstrate that the arbitration agreement was “not valid under
the law to which the parties have subjected it.”
In summary, Art. 178(2) of the PILA undoubtedly expresses the “pro-
arbitration bias” of the Swiss legislator and the creativity of the drafters of the
PILA. However, this provision also gives rise to uncertainty in its functioning.
Further, it could affect party autonomy (if it is considered that it is a mandatory
provision that does not allow the parties to select only one law to govern the
arbitration agreement) and it increases the risk of discrepancies and conflicting
decisions at the stage of enforcement of the award.
These risks reach yet another dimension under the French doctrine of “règles
matérielles.”
IV. FRENCH LAW (THE “SUBSTANTIVE RULES” APPROACH)
The originality of French arbitration law and, more specifically, of the French
doctrine concerning the assessment of the validity of the arbitration agreement
cannot be overstated.
Confronted with restrictive provisions concerning the validity of arbitration
agreements in domestic matters, the courts developed this doctrine in order to
favor the development of international arbitration in France. It hinges on a specific
meaning of the concept of “autonomy” with regard to the arbitration agreement.
Traditionally, the principle of autonomy (or separability) of the arbitration
agreement refers to the link existing between the contract and the arbitration
clause: it means in essence that the invalidity of the main contract does not
necessarily entail the invalidity of the arbitration clause contained in that contract.
As the English Arbitration Act (s7) puts it, the arbitration agreement shall, for the
purposes of assessing its existence and validity, “be treated as a distinct
agreement.”
To this original meaning, the French case law has added a new dimension,
namely the autonomy of the arbitration agreement vis-à-vis any laws. Under this
approach, the arbitration agreement is to be assessed independently from any
domestic law and its existence or validity would not depend on a prior
identification and analysis of a specific law. The Cour de cassation expressed
this approach as follows in its landmark Dalico decision: “by virtue of a
substantive rule of international arbitration law, arbitration agreements are
legally independent from the contract in which they are contained […] and […]
their existence and effectiveness are to be assessed, subject to the application
of mandatory French law rules or international public policy, by reference to
the common will of the parties, without it being necessary to refer to a national
law.”
This case law disregards any conflict of laws analysis for the arbitration
agreement. It illustrates the so-called “substantive rules” approach, which subjects
the arbitration agreement only to the “common will of the parties” and the
boundaries of “public policy” (Dalico’s reference to “mandatory French rules”
may be regarded as “redundant” in this regard (I. Fadlallah/D. Hascher, Les
grandes decisions du droit de l’arbitrage commercial, 2019, p. 31)).
The scope of application of this approach is unrelated to the seat or other
connecting factors. It extends to any situation where a French court is confronted
with an issue concerning the existence or validity of an arbitration agreement
in international matters (whether it is it at the stage of enforcement of the
award, enforcement of the arbitration agreement, or if the French juge d’appui
is called upon to intervene in an arbitration, including one seated abroad).
French scholars are divided on the merits of the substantive rules method.
Some have held that the French approach was “isolated” and “imperialist”, and
that the content of the substantive rules was uncertain, if not unpredictable
(C. Seraglini/J. Ortscheidt, Droit de l’arbitrage interne et international, 2nd ed.,
2019, pp. 552–555).
One could add that, similar to the Swiss approach under Art. 178(2) of the
PILA, the French approach increases the risks of conflicting decisions. Notably,
at the stage of enforcement of the award, it deviates from the conflict rule of
Art. V(1)(a) of the NYC and thus increases the risks that other courts will apply
different laws (or rules) to the same arbitration agreement.
The limits of the French substantive rule approach were tested in the Uni-Kod
case, a decade after Dalico, where the Cour de cassation applied it by disregarding
the (Russian) law chosen by the parties to govern the contract. In so doing, the
Court observed that this outcome was “because” the parties’ choice did not
specifically concern the arbitration agreement. Some commentators consider that
this remark might represent a “shy and hypothetical come back” of the conflict
of laws method (Seraglini/Ortscheidt, op.cit., p. 548), while others maintain that
the French substantive rules would prevail over the law specifically chosen by
the parties to govern the arbitration agreement if such law had the effect of
invalidating the arbitration agreement (Fadlallah/Hascher, op. cit., p. 29).
The autonomy of the arbitration agreement (as interpreted by the French
courts) would thus be in conflict with the autonomy of the parties!
V. SOME REFLECTIONS AND PROVISIONAL CONCLUSIONS
In Switzerland and France, two of the world’s most popular arbitral seats,
very liberal rules have been enacted (Art. 178(2) of the PILA) or developed by
the case law (Dalico and the ensuing case law) to govern the arbitration
agreement. These rules have some merits and illustrate the pro-arbitration
bias of these countries. However, their implementation may result in practical
difficulties, uncertainties, if not some legal unpredictability.
Further, they increase the risk of conflicting decisions. Conflicting decisions
may of course also exist where different courts apply the same law to the
existence and validity of the arbitration agreement, as confirmed by the Dallah
saga. However, it is obvious that the risk of conflicting decisions increases if
the courts (and arbitral tribunals, as the case may be) apply different laws or
rules to the same arbitration agreement at different stages of the assessment
of its existence and validity.
Finally, the Swiss and French approaches may run against the principle of
party autonomy, at least if one considers that they have the effect of neutralizing
a specific choice of law made by the parties to govern the arbitration agreement,
if the chosen law affects the validity of the arbitration agreement. In such a
case, the “pro-arbitration” approach adopted by these jurisdictions would not
operate to enhance party autonomy.
Chapter 98
“AGGREGATE ARBITRATION” – OR THE
QUESTION OF WHETHER ISSUE PRECLUSION
PRINCIPLES ARE “PRO-ARBITRATION”
Silja Schaffstein*
I. INTRODUCTION
I had the great privilege and pleasure of taking Professor George Bermann’s
course on international arbitration when I was an LLM student at Columbia
Law School during the 2009–2010 academic year. Rarely have I met a professor
so knowledgeable and so passionate about his area of study, teaching, and
engaging with his students. It is therefore a great honour to be able to
contribute to this book and to reflect on Professor Bermann’s legacy by thinking
about what it means to be “pro-arbitration”.
By way of background, during my year at Columbia Law School, I was co-
president of the Columbia International Arbitration Association and, in that
capacity, I helped organize the first Columbia Arbitration Day that took place
in April 2010. If my memory serves me well, it was Professor Bermann who
came up with the title for this event: “Aggregate Arbitration”. Under this title,
we debated topics dealing with arbitrations involving multiple parties, issues
or proceedings, including inter alia the joinder and consolidation of multiple
issues and parties into a single proceeding, as well as class action arbitrations.
“Aggregate Arbitration” then means bringing together multiple parties,
issues and proceedings and thereby resolving complex, multi-faceted disputes
in a manner that is time and cost-efficient.
Of course, the topic of “Aggregate Arbitration” and how the forces of efficiency,
consistency, and expediency move arbitral tribunals when addressing multi-
party, multi-issue, and multi-forum situations was (and still is) close to my heart.
Indeed, in my Ph.D. thesis on “The Doctrine of Res Judicata Before International
Commercial Arbitral Tribunals,” I advocated for the application of transnational
principles of res judicata in international arbitration. Specifically, following the
International Law Association’s Recommendations on res judiata and arbitration
and “for the sake of arbitral efficiency and finality,” I supported the application
* Silja Schaffstein is Counsel at Lévy Kaufmann-Kohler, a leading international arbitration
firm based in Geneva, Switzerland. She frequently serves as arbitrator and acts as counsel or co-
counsel, or secretary of the tribunal, in international and domestic ad hoc and institutional
arbitration proceedings. She holds a PhD from Queen Mary, University of London and the
University of Geneva; an LLM from Columbia University; and a law degree and a postgraduate
degree in advanced legal studies from the University of Geneva.
545
of res judicata principles that are broader than those commonly found in civil
law jurisdictions (where the res judicata effect of an arbitral award generally
attaches only to the award’s operative part and not to its reasons) to include
common law style issue preclusion principles.
Since graduating from Columbia Law School and publishing my Ph.D.
thesis, I have been practicing international arbitration in Switzerland, a country
with a long-standing tradition in international arbitration and a reputation for
being particularly “arbitration friendly” or “pro-arbitration.”
The Swiss Supreme Court, namely in its decision ATF 141 III 229 of May 2015,
has however refused to adopt a broader notion of res judicata in international
arbitration, which would have covered issue preclusion principles. In particular,
the Swiss Supreme Court has confirmed that the res judicata effect of an arbitral
award does not extend to an arbitral tribunal's preliminary determinations on
questions of law and fact contained in the award's underlying reasoning.
Against this background, I am asking myself whether the application of
issue preclusion principles in international arbitration is “pro-arbitration”?
This question in turn raises two questions. The first question is, of course,
“what does it mean to be 'pro-arbitration'?”, and the second question is whether
issue preclusion principles can apply in international arbitration in a way that
is “pro-arbitration.”
II. WHAT DOES IT MEAN TO BE “PRO-ARBITRATION”?
It appears only appropriate for the purposes of this contribution to look at

how Professor Bermann has himself answered the question of “What Does it
Mean to Be ‘Pro-Arbitration’?”
In very short, in his publication of the same title, Professor Bermann lists a
non-exhaustive catalogue of 12 criteria for measuring the “pro-arbitration”
character of a certain policy or practice, noting however that these criteria may
be “in direct tension with one another” and that “a trade-off of some sort” among
these criteria is thus required. The catalogue comprises the following questions:
• to what extent does it render international arbitration economical in

terms of time or cost?
• to what extent does it ensure consent to arbitrate and enhance the scope
for party autonomy?
• to what extent does it effectuate the likely intentions or expectations of
the parties?
• to what extent is it consistent with the lex arbitri or the institutional rules
chosen by the parties?
• to what extent does it, consistent with party intent, enable the tribunal to
exercise sound discretion and flexibility on matters of arbitral procedure?
• to what extent does it ensure the independence and impartiality of
arbitrators?
“AGGREGATE ARBITRATION” 547
• to what extent does it protect a party’s right to be heard?

• to what extent does it promote accuracy in the administration of justice?
• to what extent does it minimize, to the fullest extent reasonably possible,
the intervention of national courts in the arbitral process?
• to what extent does it help ensure that the resulting award will be an
effective one?
• to what extent does it enable the resulting award to withstand challenges
in an annulment or enforcement action?
• to what extent does it expand the categories of legal claims treated as
arbitrable?
To this, Professor Bermann adds the question “to what extent does a given
policy or practice enhance international arbitration’s legitimacy overall,”
clarifying that “legitimacy” is to be measured in terms of values that are
extrinsic to arbitration, including, for example, general values of fundamental
fairness.
This exceedingly short summary naturally cannot do justice to the depth
of Professor Bermann’s reflections on this question and the complexity of the
issues and considerations here at stake. However, in light of the limited scope
and the specific purpose of this short contribution, the above summary will suffice.
III. ARE ISSUE PRECLUSION PRINCIPLES “PRO-ARBITRATION”?
Broadly speaking, under issue preclusion principles, an arbitral tribunal

would grant preclusive effects to—and thus consider itself bound by—certain
determinations of issues of fact and/or law contained in an earlier decision,
namely where such issues were actually debated and determined in the earlier
decision, where that determination was necessary and fundamental to the
earlier decision, and where the identical issue falls for decision again before
the arbitral tribunal subsequently sought.
The “tension” among the above-listed criteria and the need for a “trade-off”
appear clear: issue preclusion principles would certainly promote policy
considerations of procedural efficiency, finality, as well as legal coherence and
certainty in international arbitration. Parties who had the opportunity to fully
debate a certain issue would be bound by a necessary determination of such
issue and would not be allowed to re-open that issue in other or further
proceedings, with a risk of contradictory decisions on a same issue between
the same parties.
Moreover, issue preclusion principles may generally be said to uphold the
parties’ presumed intent when agreeing to arbitrate, namely to grant the (first)
arbitral tribunal broad jurisdiction over all disputes arising from the parties’
particular legal relationship and covered by their arbitration agreement.
Conversely, one may argue that issue preclusion principles would limit a
second arbitral tribunal’s comprehensive jurisdiction to determine all issues
necessary to decide the particular dispute before it, as well as the parties’
freedom to present their case and be heard on a discreet issue arising in other
proceedings and with respect to a different claim.
Further, the application by an arbitral tribunal of issue preclusion principles
may disappoint the legitimate expectations of some parties, for instance, where
such parties come from a civil law jurisdiction such as Switzerland that does
not recognize the doctrine of issue preclusion, and where a decision’s reasons
generally have no preclusive effect, even if they constitute the necessary
foundation of a decision’s operative party.
In some countries, such as Switzerland, an application by an arbitral tribunal
of issue preclusion principles may even be considered (rightly or wrongly) as
a violation of procedural public policy. As a result, where an arbitral tribunal
seated in Switzerland attributes issue preclusive effects to the determinations
in an earlier decision's reasoning (rather than in its operative part) and thereby
declines to decide the claims before it, the arbitral award may risk being set aside.
It is not entirely clear in what situation the application by an arbitral
tribunal of issue preclusion principles would be considered, as such, as a
breach of procedural public policy. For instance, the risk that such application
would lead to a coexistence within the same legal order of two contradictory,
but equally and simultaneously enforceable judicial decisions on the same
subject matter and between the same parties would appear minor. As just
seen, one may argue that the application of issue preclusion principles would
rather avoid contradictory decisions on a same issue between the same parties
and thus promote policy considerations of finality and legal coherence.
Moreover, the risk that the application of issue preclusion principles would
violate fundamental due process principles, including the right to access to
justice, would also appear minor with respect to earlier determinations of
fundamental issues that constituted the necessary foundation of an earlier
decision’s operative part. Indeed, such fundamental issues would have been
necessarily raised, debated and decided between the same parties in the
earlier or other proceedings.
Be that as it may, under Swiss law in its current state, disregarding the res
judicata effect of a prior judgment or arbitral award or, inversely, wrongly
attributing res judicata effect, including issue preclusive effects, to a prior
decision, may be found to constitute a breach of procedural public policy and,
accordingly, result in the setting aside of the award.
To what extent would the application of issue preclusion principles
enhance international arbitration’s legitimacy overall?
It emerges from the brief discussion above that the answer to this question
is not clear-cut and will depend on policy considerations that vary from one
jurisdiction to another and on the different “trade-offs” to be performed based
on such varying policy considerations. While some may consider issue preclusion
principles as inherently fair and in furtherance of international arbitration’s
legitimacy and purpose, others may disagree and consider that it is at odds
“AGGREGATE ARBITRATION” 549
with due process and the parties’ intention to submit a particular dispute to
the comprehensive jurisdiction of a particular arbitral tribunal.
IV. CONCLUSION
Determining whether issue preclusion principles are “pro-arbitration” is a

difficult task and the answer may vary from one jurisdiction to another. It may
well take appropriately tailored and widely accepted transnational res judicata
principles to settle this issue.
Coming back to the title of this contribution, “Aggregate Arbitration”: in the
introduction to this contribution, this term was defined as bringing together
multiple parties, issues and proceedings so as to efficiently resolve complex
disputes; an undertaking that assuredly appears as “pro-arbitration.”
Likewise, there can be no doubt as to the “pro-arbitration” character of
bringing together students from all over the world, being open, curious and
interested in their varying opinions and approaches, and instilling in them a
common passion for international arbitration.
For Professor George Bermann, in gratitude.

Chapter 99
“PRO-ARBITRATION” IN AN INVESTOR-STATE
CONTEXT: ASSIGNMENT OF INVESTMENT
TREATY CLAIMS
Simón Navarro Gonzalez*
Much has been written about what pro-arbitration means in the context of
commercial arbitration. Much less in an investor-state one since, in the words
of Professor Bermann, it is very difficult “to separate arbitration as a foreign
investment dispute resolution vehicle, on the one hand, from foreign investment
law and policy, on the other.”1 One aspect that may be worth discussing, however,
is how flexible the current investor-state dispute settlement system (ISDS) is, how
it accommodates the ever frequent transfers of investments between economic
operators and, in particular, whether the original investor’s treaty rights and
claims can pass along jointly with, or separately from, the underlying investment.
In practice, the assignment of investment-treaty claims seems desirable
and aligned with the ISDS’ goal to promote foreign direct investment. Whether
that assignment is legally valid under international law, however, is a more
nuanced matter.
As a starting point, “[t]he law governing the arbitration agreement determines
the assignability of the agreement, the conditions to which the assignment is
subject, and the consequences of the assignment, at least as far as relations
between the assignor and its initial co-contractor are concerned.”2 Consequently,
the assignability of investment treaty rights must be determined according to
international law in general, and the relevant treaty as lex specialis. The analysis
may vary, however, depending on whether the claim is transferred to a third party
together with the underlying investment or in isolation. A brief analysis of both
scenarios follows.
* Simón Navarro Gonzalez is a Partner at Sidley Austin.

1 G. A. Bermann, What does it mean to be “pro-arbitration”? Arbitration International,
Volume 34, Issue 3, September 2018, p. 342.
2 See E. Gaillard and J. Savage (eds), Fouchard Gaillard Goldman on International Commercial
Arbitration (Kluwer Law International, 1999) para. 698 (“[t]he law governing the arbitration
agreement determines the assignability of the agreement, the conditions to which the assignment is
subject, and the consequences of the assignment, at least as far as relations between the assignor
and its initial co-contractor are concerned … By contrast, relations between assignor and assignee
are governed by the law chosen by those parties for that purpose”). See also Dicey, Morris and
Collins on the Conflict of Laws, para. 24R-050 (“[t]he law governing the right to which the
assignment relates determines its assignability, the relationship between the assignee and the
debtor, the conditions under which the assignment can be invoked against the debtor and any
question whether the debtors obligations have been discharged”).
551
I. TRANSFER OF TREATY CLAIMS TOGETHER WITH THE UNDERLYING

INVESTMENT
From a jurisdictional standpoint, the right to invoke the State’s offer to

arbitrate and to bring a claim under an investment treaty rests with those
individuals who, or entities which, under the relevant treaty, fall within the
definition of “investors” (nationals of a party to the treaty) and have made an
“investment” in the host State. Consequently, the most common scenario for
transfers of investment treaty claims by a protected investor to a third party
results from the transfer of the underlying “investment.” The Tribunal in
Société Generale v. The Dominican Republic noted that the transfer of
investments “has become a normal feature of a global economy and the
transfers are not as such disqualified from treaty protection....”3
One relevant distinction must be made, however, based on the date on
which the investor transfers the investment to a third party. If the transfer of
the investment takes place before the breach of the State’s international
obligations, it is generally understood that the transferor would lose its “status
as a protected investor, with the consequence that any subsequent actions of
the host State can no longer give rise to treaty claims.”4 Should the transferee
meet the relevant treaty requirements, it would acquire standing to file a claim
under that treaty. Several tribunals have confirmed this position.
In Fedax v. Venezuela, promissory notes were assigned from a Venezuelan
national to a Dutch company before the cause of action arose.5 The Dutch
investor subsequently filed a claim against Venezuela, and the tribunal exercised
jurisdiction over the claim on the basis that the promissory notes were freely
transferrable and the breach complained of had occurred subsequent to the
assignment.6 Similarly, the Tribunal in Amco v. Indonesia held that “the right
acquired by Amco Asia to invoke the arbitration clause is attached to its
investment, represented by its share in P.T. Amco, and may be transferred with
those shares.”7
In contrast, if the transfer of the investment takes place after the State’s
breach of the investment treaty, it is generally understood that the transferor
3 See Société Générale in respect of DR Energy Holdings Limited and Empresa Distribuidora
de Electricidad del Este, S.A. v. The Dominican Republic, LCIA Case No. UN 7927, Award on
Preliminary Objections to Jurisdiction, 19 Sept. 2008, para. 44.
4 H. Wehland, The Transfer of Investments and Rights of Investors under International
Investment Agreements—Some Unresolved Issues, Arbitration International, Volume 30, Issue 3,

1 September 2014, p. 565–576, 570.
5 See Fedax N.V. v. The Republic of Venezuela, ICSID Case No. ARB/96/3, Decision of the
Tribunal on Objections to Jurisdiction, 11 Jul. 1997, para. 13.

6 See Fedax N.V. v. The Republic of Venezuela, ICSID Case No. ARB/96/3, Decision of the
Tribunal on Objections to Jurisdiction, 11 Jul. 1997, para. 39.

7 See Amco Asia Corporation, Pan American Development Ltd and PT Amco Indonesia v. The
Republic of Indonesia, Decision on Jurisdiction, 25 Sept. 1983, 1 ICSID Rep 377 (1993) para. 31.
See also Autopista Concesionada de Venezuela, C.A. v. Bolivarian Republic of Venezuela, ICSID Case
No. ARB/00/5, 27 Sept. 2001, Decision on Jurisdiction, para. 129.
retains the right to bring a claim against the host State. Several tribunals have
concluded that there is no “continuous nationality requirement” and that
subsequent sales of investments—even to non-nationals—do not deprive an
investor-State tribunal of its jurisdiction to hear a claim brought by the original
investor.8 For instance, the Tribunal in Encana v. Ecuador indicated that:
[p]rovided loss or damage is caused to an investor by a breach of the

Treaty, the cause of action is complete at that point; retention of the
subsidiary (assuming it is within the investor’s power to retain it) serves
no purpose as a jurisdictional requirement, though it may be relevant
to questions of quantum.9
Similarly, in Daimler v. Argentine Republic, the Tribunal held that the claimant
retained standing as a qualifying investor to bring the claim for damages
sustained during the time when it owned the investment notwithstanding the
subsequent transfer of its investment.10 This conclusion has been widely accepted
by scholars: “[t]here is little doubt that the transferor of an investment can have
treaty claims for damages arising out of pre-transfer breaches of a [treaty]
even after the transfer has been completed.”11
8 As pointed out by the Daimler Tribunal (Daimler Financial Services A.G. v. Argentine
Republic, ICSID Case No. ARB/05/1, Award, 22 Aug. 2012): “only the Loewen tribunal… actually
declined jurisdiction on a parallel (though not identical) ground. In that case, a NAFTA tribunal
found that it lacked jurisdiction on the basis that the investor failed to maintain a continuous
nationality after a cross-border bankruptcy proceeding forced the investor to undergo a
corporate re- organization which changed the investor’s nationality from Canadian to U.S. 251
But the Loewen tribunal’s imposition of this continuous nationality requirement has been
criticized from many quarters (See e.g., EMMANUEL GAILLARD, la jurisprudence du CIADI 788
(2004); Maurice Mendelson, The Runaway Train: The “Continuous Nationality” Rule from the
Panavezys- Saldutiskis Railway case to Loewen, in international investment law and arbitration:
leading cases from the ICSID, NAFTA, biltateral treaties and customary international law (Todd
Weiler ed., 2005); Noah Rubins, Loewen v. United States: The Burial of an Investor-State
Arbitration Claim, 21 ARB. INT’L 1 (2005); Jan Paulsson, Continuous Nationality in Loewen, 20
ARB. INT’L 213 (2004). As one commentator noted: “Indeed, in 2000 the International Law
Commission’s rapporteur on diplomatic protection concluded that there was no rule of
customary international law with respect to continuous nationality because opinions and
practice as to the range of dates on which a claimant must have the requisite nationality had
varied so much.” (Andrea K. Bjorkland, The Emerging Civilization of Investment Arbitration, 113
PENN STATE L. REV 169 (2009) at p. 1280 (citing International Law Commission, Report to the
International Law Commission on Diplomatic Protection, A/CN.4/506/Add.1 (April 20, 2000)).”
9 See EnCana Corp. v. Republic of Ecuador, LCIA Case No. UN 3481, Award, 3 Feb. 2006, para. 131.
10 See Daimler Financial Services A.G. v. Argentine Republic, ICSID Case No. ARB/05/1,
Award, 22 Aug. 2012, para. 154.

11 H. Wehland, The Transfer of Investments and Rights of Investors under International
Investment Agreements — Some Unresolved Issues, Arbitration International, Volume 30, Issue 3,
1 September 2014, 565–576, 571.
II. TRANSFER OF TREATY CLAIMS SEPARATELY FROM THE

UNDERLYING INVESTMENT
Investment treaties are silent on whether treaty claims are assignable

separately from the underlying investment, and there is no consensus among
tribunals or scholars. Certain authorities have held that treaty claims cannot
be readily assigned “as shares in the stock-exchange market or other types of
negotiable instruments,”12 while other authorities have not excluded the
possibility that, in principle, rights arising under investment treaties may be
freely assignable.13 Various arguments could be made for and against.
A. Arguments Against the Assignability of Treaty Claims
Several scholars and tribunals have spoken against the transferability or

assignability of treaty claims, separately from the investment out of which they
arise.
First, it has been suggested that investment treaty rights are intuitu personae
and therefore not assignable: “Specifically, whether in municipal law14 or in
international law, the question is whether the rights and obligations given to
the assignor are intuitu personae such that they cannot be unilaterally assigned.”15
Indeed, Professor Crawford has suggested that “treaty rights and claims are
not assignable for this reason.”16
It is hard to deny that investment treaty claims are still “perceived as
particularly sensitive and closely linked to issues of sovereignty.”17 On this
basis, the possibility of an assignment of treaty rights to a national of a non-
12 See Mihaly lnternational Corporation v. Sri Lanka, ICSID Case No. ARB/00/2, Award of
March 15, 2002, 17 ICSID Rev.-FILJ 142 (2002), para. 24 (“[a] claim under the ICSID Convention
with its carefully structured system is not a readily assignable chose in action as shares in the
stock-exchange market or other types of negotiable instruments, such as promissory notes or
letters of credit.”).
13 See M. S. Duchesne, The Continuous-Nationality-of-Claims Principle: Its Historical Development
and Current Relevance to Investor-State Investment Disputes, 36 Geo. Wash. Int’l L. Rev. (2004),
783–815, at 808 (“[O]nce a State has breached a private investor’s rights under an investment
treaty or other investment agreement, the separate right to recover damages for that breach is
really a property right vested in the claimant. As such, any subsequent change in the investor’s
nationality, or even subsequent transfer of the claim, should be irrelevant. These changes do not
affect the fact that the respondent state breached its obligations under a binding agreement, and
so should not affect the state’s liability for that breach.”).
14 See J. Chorus and others (eds), Introduction to Dutch Law (5th edn, Wolters Kluwer 2016)
144; KH Lau, “Unilateral Transfers of Contractual Obligations” (2013) LQR 491; R Goode, “Contractual
Prohibitions against Assignment” (2009) Lloyd’s Marit Comm LQ 300.
15 See N. Goh, The Assignment of Investment Treaty Claims: Mapping the Principles, Journal
of International Dispute Settlement, Volume 10, Issue 1, March 2019, p. 23–41, 36.
16 See J. Crawford, Brownlie’s Principles of Public International Law (8th edn, OUP 2012) 704.
17 See H. Wehland, The Transfer of Investments and Rights of Investors under International
1 September 2014, 565–576, 575.
signatory of the treaty clearly seems unfeasible. But even assignments to nationals
of the same State would seem questionable since “States would still lose control
over who could assert treaty breaches and bring arbitral proceedings against
them.”18 Absent clear treaty language to that effect, it is difficult to conclude
categorically that the signatories intended such a result.
The Mihaly Tribunal endorsed this position: “[a] claim under the ICSID
Convention... is not a readily assignable chose in action as shares in the stock-
exchange market or other types of negotiable interests.”19 This holding, which
forms part of the ratio decidendi of the award, has been interpreted as expressing
the view that “isolated claims under the ICSID Convention should not be
assignable to other juridical entities”20 and that “an investor seeking to transfer
a potential treaty claim should rather create a new juridical entity (or transfer
its shares to a juridical entity) located in a State that has already enacted a BIT
with the host State of investment....”21
Certain scholars share the tribunal’s conclusion in Mihaly:
[The] position of the tribunal in Mihaly seems indeed to be the correct

one.22 While IIAs [international investment treaties] do not explicitly
address the transferability of rights arising under them, an interpretation
in accordance with the principles embodied in Articles 31 and 32 of the
VCLT [Vienna Convention on the Law of Treaties] will typically reveal
that neither damages claims nor jurisdictional offers under these
treaties are freely transferable.23
Second, it has also been suggested that transfers of treaty claims would not
be valid without the host State’s consent. Under international law, investment
treaties contain the State’s offer to arbitrate, which investors may subsequently
accept. On that basis, it could be argued that transfers of the State’s offer to
arbitrate to a third party must be consented to by the State that extended the
offer. Prominent practitioners have held that “[i]t is not clear that the benefit
1 September 2014, 565–576, 575.
19 See Mihaly lnternational Corporation v. Sri Lanka, ICSID Case No. ARB/00/2, Award of
March 15, 2002, 17 ICSID Rev.-FILJ 142 (2002), para 24.

20 See W. L. Kirtley, The Transfer of Treaty Claims and Treaty-Shopping in Investor-State
Disputes, Journal of World Investment & Trade, vol. 10, no. 3, June 2009, p. 427–462, 433.
21 See W. L. Kirtley, The Transfer of Treaty Claims and Treaty-Shopping in Investor-State
Disputes, Journal of World Investment & Trade, vol. 10, no. 3, June 2009, p. 427–462, 433.
22 See also S. Jagusch & A. Sinclair, 77K Impact of Third Parties on International Arbitration -
Issues of Assignment, in Pervasive Problems in International Arbitration 296 (L. Mistelis & J. Lew
eds., 2006); W. Kirtley, The Transfer of Treaty Claims and Treaty-Shopping in Investor-State
Disputes, J.W.I. T. 434 (2009).
1 September 2014, 565–576, 575.
of the latter consent may be assigned to a third person, at least not without the
host State’s consent.”24 A few arbitral tribunals have also pointed in that
direction. Albeit in a contract claim, the Tribunal in Amco v. Indonesia held that:
To be sure, for such a transfer to be effective, the government of the

host-country must approve it, which approval has as its consequence
that said government agrees to the transferee acquiring all rights
attached to the shares, including the right to arbitrate, unless this latter
right would be expressly excluded in the approval decision.25
The conclusion in Mihaly—a treaty case—was similar. The claimant in that

case suggested that he had been assigned “all the rights, interests, and claims”
previously held by a Canadian company, while Sri Lanka objected that “the
personal nature of the transactions and negotiations... precluded the possibility
of a valid assignment of any claim of rights without the consent of Sri Lanka.”26
As discussed above, the Tribunal sided with the investor.
Third, investment treaties are generally silent on issues of assignment and
subrogation. In fact, “only a handful of treaties contain subrogation clauses.”27
The mere existence of these clauses may suggest that assignments that fall
outside of the scope contemplated in the treaty would not be permitted.
The Netherlands is one of the few countries that included a subrogation
clause in its new Model BIT.28 Based on that provision, Article 7 of the
Netherlands-Mexico BIT, for example, provides as follows:
If the investments of a national of the one Contracting Party are insured

by a wholly privately owned and controlled insurance corporation
(hereinafter referred to as “insurance corporation”), against
noncommercial risks or otherwise give rise to payment of indemnification
24 See S. Jagusch & A. Sinclair, 77K Impact of Third Parties on International Arbitration - Issues of
Assignment, in Pervasive Problems in International Arbitration 296 (L. Mistelis &J. Lew eds., 2006),
291–319, 296. Here See also Georges R Delaume, ICSID Arbitration: Practical Considerations, 1 J
Int'l Arb 101 (1984); Pierre Lalive, Some Objections to Jurisdiction in Investor-State Arbitration,
Albert Jan van den Berg (ed), International Commercial Arbitration: Important Contemporary
Questions (ICCA Congress Series No. 11, Kluwer Law International, 2003) 376, 385–387.
25 See Amco Asia Corporation, Pan American Development Ltd and PT Amco Indonesia v. The
Republic of Indonesia, Decision on Jurisdiction, 25 Sept. 1983, 1 ICSID Rep 377 (1993) para. 31.
See also Autopista Concesionada de Venezuela, C.A. v. Bolivarian Republic of Venezuela, ICSID Case
No. ARB/00/5, 27 Sept. 2001, Decision on Jurisdiction, para. 129.
26 See Mihaly International v. Sri Lanka, supra n. 41, at para. 16. See also the argument of the
respondents in Rumeli Telekom and Telsim Mobil v. Kazakhstan, ICSID Case No. ARB/05/16,
Award, 29 Jul. 2008, para. 267; Wintershall Aktiengesellschaft v. Argentina, supra n. 41, at
paras. 51, 53.
of International Dispute Settlement, Volume 10, Issue 1, March 2019, 23–41, 28. See also Scheuer
and others, The ICSID Convention: A Commentary (2nd edn, CUP 2009) 186–90.
28 See Netherlands Draft Model BIT, available at https://globalarbitrationreview.com/digital_
assets/820bcdd9-08b5-4bb5-a81e-d69e6c6735ce/Draft-Model-BIT-NL-2018.pdf.
in respect of such investments under a system established by law,

regulation or government contract, any subrogation of the insurance
corporation to the rights of the said national pursuant to the terms of
such insurance or under any other indemnity given shall be recognized
by the other Contracting Party. Only the national or the insurance
corporation shall be entitled to exercise such rights and to engage in a
dispute with respect to those rights.
The Treaty sets forth, as lex specialis, the specific requirements under
which the host State must recognize the assignment of claims to an insurer.
Conversely, it could be argued that the host State would not be obliged to
recognize assignments of claims that fall outside the scope of the Treaty’s
subrogation clause. As one scholar pointed out, “[t]his explicit recognition of
assignment or subrogation by a contracting state may be seen as a first hint
that, a contrario, treaty claims might not be as readily assignable as claims
arising out of commercial contracts.”29
In addition, following with the example of the Netherlands-Mexico BIT, the
treaty does not exclude the standing of the original investor “to engage in a
dispute” with the State. With respect to a similarly worded treaty, the Tribunal
in Hochtief v. Argentine Republic concluded that a potential subrogation would
not extinguish the rights of the insured investor:
Article 6 [of the Germany-Argentina BIT] is phrased in terms that do

not require that the insuring State succeed to and extinguish the rights
of the insured investor once payment is made on the insurance policy.
Much less does Article 6 itself bring about that legal result. Article 6
merely obliges the respondent State to recognize or admit (“reconocerá,
erkennt”) such a transfer of rights if and when the transfer is in fact
effected by provision of law or by a legal act.30
Based on the above, there are various arguments supporting the

proposition that, absent a specific subrogation clause in the treaty, investment
claims would not be assignable to third parties. The effects of a potential
subrogation or assignment local law may only be effective between assignor
and assignee but would not be valid under international law nor would it be
recognized by the host State.
29 See J. von Goeler, Chapter 6: Jurisdictional Issues and Third-Party Funding, in Third-Party
Funding in International Arbitration and its Impact on Procedure, International Arbitration Law
Library, Volume 35 (Kluwer Law International 2016) pp. 207–252.
30 See Hochtief AG v. Argentine Republic, ICSID Case No. ARB/07/31, Decision on Liability,
29 December 2014, ¶ 186.

B. Arguments for the Assignability of Treaty Claims
The issue is far from settled and there are also arguments in favor of the
validity of assignments of treaty rights under international law. Although some
arguments may be inconclusive, the position may be more desirable from a
practical standpoint.
First, it has been argued that investment treaties do not expressly prohibit
the assignment of treaty claims. They do not expressly permit such assignments
either, as it could be argued conversely, so the argument seems unpersuasive.
In addition, certain investment treaties do contain subrogation clauses, as
discussed above, which could be read as not permitting subrogation in
circumstances other than those expressly contemplated therein.
Second, from a practical standpoint, assignment of treaty rights seems
desirable for the free transfer of goods and services in a globalized economy.
A scholar pointed out that “claims trading increase overall liquidity in capital
markets and lowers the cost of credit ‘as the option of avoiding the uncertainty
of being a creditor in bankruptcy increases the risk tolerance of originating
lenders’”31 On this basis, it has been suggested that assignment of treaty rights
“may be compatible with the ISDS system as it facilitates the redeployment of
funds and assets. This view is compatible with the notion that an investor
protected by an investment treaty has a ‘direct claim’ which it would be entitled
to divest insofar as the transfer is not prohibited by the host State.”32
This argument seems persuasive and desirable from a practical standpoint
but inconclusive from a legal one. The fact that the assignability of claims
would be desirable or compatible with the investment protection system, does
not mean that a specific authorization in that regard may be read into the text
of the treaties or a specific intention assigned to their signatories.
Third, based on the two arguments discussed above, certain arbitral tribunals
have suggested that, in theory, assignment of treaty claims may be valid under
international law. Notably, in Daimler v. Argentine Republic, the Tribunal
suggested that good commercial reasons exist for the compatibility of claim
assignments with the ISDS system:
As the large and thriving global market for distressed debt attests,
most jurisdictions allow for legal claims to be either sold along with or
reserved separately from the underlying assets from which they are
derived. The reason is that such severability greatly facilitates and
speeds the productive re-employment of assets in other ventures.33
of International Dispute Settlement, Volume 10, Issue 1, March 2019, p. 23–41, 26. See also A
Levitin, “Bankruptcy Markets: Making Sense of Claims Trading” (2010) 4 Brook J Corp Fin Com L 70.
of International Dispute Settlement, Volume 10, Issue 1, March 2019, p. 23–41, 35.
33 See Daimler Financial Services AG v. The Argentine Republic, ICSID Case No ARB/05/1,
Award, 22 August 2012, para. 144.

On this basis, the Daimler Tribunal concluded that “the better view would
seem to be that ICSID claims are at least in principle separable from their
underlying investments.”34
Similarly, in El Paso v. Argentine Republic, the tribunal rejected the
respondent’s argument that the investor’s sale of its investment represented
an obstacle to its jurisdiction, but seemed to assume that “the right to demand
compensation for the injury suffered at the hands of the State could at least in
principle be sold with the investment.”35 A similar view could also be inferred
from the reaction of the ICSID Secretariat to the investor’s initial claim in
Phoenix Action that he had been assigned a “right of action” under the Czech
Republic-Israel BIT. While the Secretariat requested a clarification from the
claimant in this regard, this request merely appeared to stem from the fact that
the supposed assignor clearly had no right of action under the treaty rather
than from the assignment itself.36 In Phelps Dodge Corp. & OPIC v. Iran, the Iran-
U.S. Claims Tribunal granted the claim filed jointly by a U.S. national and the
insurer that had made the investor partially whole for its losses, seemingly
accepting the validity of the transfer of the claim to the insurer.37
The conclusions in these awards, however, must be read with caution for
the following reasons:
(i) All of the decisions referred to above assessed the assignment of treaty
claims together with the underlying investment, not in isolation.
(ii) As opposed to the conclusion in Mihaly,38 the statements regarding the
assignability of investment treaty claims in the decisions above are
obiter dicta.
(iii) The reasoning in Daimler and El Paso includes certain caveats. The
tribunals asserted that claims could, in theory, be “shown [to be] sold
with the investment,”39 or “at least in principle be separable from their
underlying investment.”40
(iv) The Daimler Tribunal, which made the more direct statement in favor
of assignability, did not in fact rule that the investor had validly
assigned the claim in that particular case: “all of the available evidence

35 See El Paso Energy v. Argentina, supra n. 33, at para. 135. See also African Holding v.
Democratic Republic of the Congo, supra n. 7, at para. 63; Wintershall Aktiengesellschaft v.

Argentina, supra n. 41, at para. 56.
36 See Phoenix Action v. Czech Republic, supra n. 8, at paras. 5, 7.
37 See Phelps Dodge Corp. and Overseas Private Investment Corp. v. The Islamic Republic of
Iran, IUSCT Case No. 99.

38 Mihaly lnternational Corporation v. Sri Lanka, ICSID Case No. ARB/00/2, Award of March
15, 2002, 17 ICSID Rev.-FILJ 142 (2002).

39 See El Paso Energy Int’l Co. v. Argentine Republic, ICSID Case No. ARB/03/15, Decision on
Jurisdiction, 27 Apr. 2006, para. 135.


points to the conclusion that DFS did not relinquish its right to bring
the ICSID claim upon execution of the SPA.”41
(v) The Tribunal in Phelps Dodge—which seemingly accepted the validity
of the transfer—assessed the standing of the U.S. national but did not
address the standing of the insurance company. In the dispositive
portion of the decision, the Tribunal awarded damages only to the U.S.
national, not to the insurer.42
Powerful arguments speak in favor of assignability. These arguments may

benefit from a more conclusive holding by international tribunals sanctioning,
as ratio decidendi, the validity of the assignment of investment treaty claims
separately from the underlying investment that gave rise to them.
III. CONCLUSION
The issue of whether assignment of treaty claims separately from the

underlying investment is valid under international law is not settled. Based on
the existing case law and legal literature, the arguments that speak against the
validity of such assignments seem to be stronger than those in favor.
The desirability of the free transfer of investment claims, however, is
harder to dispute. There is an inherent economic benefit to the free trade of goods
and rights, and investment treaty rights are no different. The ISDS system
should accommodate to a reality of constant changes in investment ownership,
without depriving investors of the opportunity to freely transfer those claims
with or without their investment. The foreign direct investment system should
be as flexible as the dispute resolution method on which it relies for protection.
Investment treaties have failed to expressly address the assignment of
treaty claims in the past. Maybe, it is something for third generation BITs to
cover; maybe, it is for arbitral tribunals to fill that gap. Either way, more clarity
on this issue would undoubtedly contribute to solidify the legitimacy of the
ISDS system. And it has been wisely suggested that “acknowledging legitimacy…
as in itself a pro-arbitration attribute may be among the most arbitration friendly
moves one can make.”43

42 See Phelps Dodge Corp. and Overseas Private Investment Corp. v. The Islamic Republic of
Iran, IUSCT Case No. 99, Award, 19 March 1986, para. 32.
43 G. A. Bermann, Arbitration International, Volume 34, Issue 3, September 2018, p. 553.
Chapter 100
SELECTED PRO-ARBITRATION FEATURES OF THE
SWISS LEX ARBITRI
Simon Vorburger*
I. INTRODUCTION
Switzerland’s pro-arbitration stance is well known to the global arbitration

community. Professor Bermann frequently referenced “pro-arbitration” Swiss
law concepts in his lectures at Columbia Law School, which I had the pleasure
of attending. He was able to draw from his broad firsthand experience of
Switzerland’s approach—thanks to his involvement in numerous arbitrations
involving Switzerland and his experience as a faculty member of the Geneva
Center for International Dispute Settlement.
Switzerland’s affinity for policies encouraging arbitration began in 1866
with the first commercial arbitration conducted by the Geneva Chamber of
Commerce, Industry and Services. It was followed by the publication of the first
commercial arbitration rules by the Basel Chamber of Commerce in 1869 and
the establishment of a commercial arbitration court in Zurich in 1911. The
longstanding openness for arbitration and the respective policies were
ultimately embodied on a federal level in Chapter 12 of the Swiss Federal Act
on Private International Law (PILA) of 1989. The PILA’s Chapter 12—applicable
to international arbitrations seated in Switzerland—constitutes a progressive
legislation similar to almost none. The PILA’s innovative character cementing
Switzerland’s “pro-arbitration” stance continues to be adjusted by way of
amendments to its Chapter 12 (the latest in 2020), which take into account the
needs of the modern arbitration world.
This essay addresses three selected aspects of the PILA’s Chapter 12 in more
detail: First, Swiss law’s embodiment of the principle of favor validitatis in
relation to arbitration agreements. Second, the approach taken by the Swiss lex
arbitri in case of simultaneous proceedings in front of a State court concerning
the same dispute. Third, how international arbitration in Switzerland allows the
disputing parties to waive their right to set aside proceedings before Swiss
courts.
* Dr. Simon Vorburger, LL.M., is a Partner at Quinn Emanuel Urquhart & Sullivan and a
Lecturer in international litigation at the Zurich University School of Law.

561
II. ARBITRATION AGREEMENTS AND FAVOR VALIDITATIS
One of the exceptional expressions of Switzerland’s pro-arbitration stance

can be found in article 178 paragraph 2 PILA, addressing arbitration agreements.
It reads:
As regards its substance, the arbitration agreement shall be valid if it

conforms to the law chosen by the parties, or to the law applicable to
the dispute, in particular the law governing the main contract, or to
Swiss law.
This provision goes to the very core of every arbitration. It sets out the
requirements of the substantive validity of the arbitration agreement and
whether there is consensus of the contracting parties to submit their dispute
to arbitration. The provision refers to three options of applicable laws, under
which the validity of the arbitration agreement can be scrutinized, namely
(i) the law chosen by the contracting parties, (ii) the law applicable to the
subject-matter of the dispute or (iii) Swiss law. If an arbitration agreement is
valid under one of the above-referenced laws, an arbitral tribunal seated in
Switzerland will accept jurisdiction. This principle is called favor validitatis.
Whereas there is no hierarchy between the three laws applicable to the
validity of the arbitration agreement, in practice the arbitral tribunal should,
when examining the substantive validity of an arbitration agreement, respect
the contracting parties’ intentions. It should follow the order of article 178
paragraph 2 PILA and apply Swiss law only if either the contracting parties
have not chosen a law, or if the arbitration agreement would be invalid under
the law chosen by the contracting parties or the law applicable to the subject-
matter of the dispute.
By including the possibility for tribunals to hold an arbitration agreement
valid under three potentially different laws, the Swiss legislator includes a
remarkable pro-arbitration stance in article 178 paragraph 2 PILA.
III. NO STAY OF ARBITRAL PROCEEDINGS IN CASE OF PARALLEL

PROCEEDINGS
A second example of Switzerland’s pro-arbitration stance is provided for

in article 186 paragraph 1bis PILA, addressing certain aspects of parallel
proceedings involving an international arbitral tribunal seated in Switzerland.
As a general rule, if proceedings relating to the same dispute are brought
before both an arbitral tribunal and a State court, the forum first seized will first
rule on its jurisdiction. If a State court is called upon subsequently to the arbitral
tribunal, in general the State court will stay the proceedings until the arbitral
tribunal issues a decision on its jurisdiction. This rule is, however, not mirrored
if an international arbitral tribunal seated in Switzerland is seized after the
initiation of proceedings before a State court or another arbitral tribunal.
SELECTED PRO-ARBITRATION FEATURES OF THE SWISS LEX ARBITRI 563
Article 186 paragraph 1bis PILA provides for a more arbitration-friendly

solution in such a case. According to said provision, the arbitral tribunal:
shall decide on its jurisdiction notwithstanding any pending action before

a State court or another arbitral tribunal on the same subject-matter
between the same parties, unless there are substantial reasons to stay
the proceedings.
In other words, article 186 paragraph 1bis PILA provides that if an arbitral
tribunal seated in Switzerland is seized after the initiation of national court
proceedings, the arbitral tribunal does in principle not stay the proceedings.
The notion of priority in terms of the court or tribunal seized first does not
apply. Instead, the arbitral tribunal is able to continue to assess its own
jurisdiction. An arbitral tribunal will only stay the proceedings in exceptional
circumstances. This may include a blatantly abusive commencement of arbitral
proceedings, or State court proceedings that are already far advanced, so that
a judgment by the State court is to be expected shortly and such judgment
would likely be recognized in Switzerland.
An arbitral tribunal therefore finds itself in a slightly more advantageous
position than a State court. Article 186 paragraph 1bis PILA seeks to protect
international arbitral proceedings seated in Switzerland from tactics to delay
or sabotage them by commencing proceedings before State courts or other
arbitral tribunals.
Article 186 paragraph 1bis PILA was introduced after a widely discussed
decision by the Swiss Federal Supreme Court in the often quoted Fomento case.
In said case one party commenced proceedings before State courts in Panama,
whereas (only thereafter) the other party to the dispute commenced arbitral
proceedings seated in Switzerland. The arbitral tribunal did not stay the
proceedings but decided it was—despite the pending foreign State court
proceedings—competent to hear the dispute. Said decision was later set aside
by the Swiss Federal Supreme Court. The Supreme Court decision was widely
criticized by Swiss scholars as enabling the circumvention of an international
arbitration seated in Switzerland and was ultimately corrected by the
amendment of the Swiss lex arbitri, adding a new paragraph 1bis to article 186
PILA.
IV. EXCLUSION OF SET-ASIDE PROCEEDINGS
Finally, article 192 paragraph 1 PILA is worth a mention in the context of

discussing pro-arbitration features of the Swiss lex arbitri. The provision
grants disputing parties of an international arbitration the right to exclude any
challenge against arbitral awards subject to certain requirements. The objective
of this provision is, among others, to exclude a myriad of set-aside proceedings
for dilatory reasons of arbitral awards rendered by an arbitral tribunal seated

in Switzerland with no other connection to Switzerland.
Article 192 paragraph 1 PILA reads:
If none of the parties has its domicile, habitual residence, or seat in

Switzerland, the parties may, either in the arbitration agreement or in
a subsequent agreement, exclude in whole or in part recourse against
arbitral awards; the right to revision under article 190a paragraph
1(b) PILA cannot be waived. The agreement shall meet the conditions
as to form set out in article 178 paragraph 1 PILA.
In brief, if none of the disputing parties is domiciled in Switzerland, the

parties may agree to waive their right to challenge an arbitral award. However,
the parties cannot waive a review under article 190a paragraph 1(b) PILA.
This exception provides for a legal remedy if criminal proceedings have
established that the arbitral award was influenced to the detriment of the
party concerned by a felony or misdemeanor.
As a result, where the disputing parties validly waived their right to
challenge an arbitral award, an arbitral award rendered by an arbitral tribunal
in Switzerland will only be subject to judicial scrutiny if a court is called upon
to enforce the award.
V. CONCLUSION
The above showcases only a few of the numerous arbitration-friendly

elements incorporated in the Swiss lex arbitri. The Swiss legislator strives for
a legislation that protects and favors the efficient resolution of international
disputes before international arbitral tribunals seated in Switzerland.
Accordingly, the Swiss legal system is indeed pro-arbitration.
Chapter 101
PARTY AUTONOMY, COURTS’ INTERVENTION
AND “PRO-ARBITRATION” POLICY:
A CONCATENATION OF CONCEPTS TOWARDS
ARBITRAL EFFICACY?
Tolu Obamuroh*
I. INTRODUCTION
In his article, “What Does it Mean to Be ‘Pro-Arbitration’?”, Professor George

Bermann explained that, if viewed in abstract terms, a policy or practice could
be called “pro-arbitration” (or “arbitration-friendly”) if it advances or favors the
achievement of the purposes of international arbitration. Thus, a legal system
may be deemed to be pro-arbitration if the features of its arbitration regime
likewise advance the purposes of international arbitration.
What amounts to the purpose of international arbitration is up for debate
and certainly multifaceted, but there seems to be a consensus that parties to
arbitration want to resolve their disputes in a timely and cost effective way,
while minimizing the intervention of national courts, to the extent reasonably
possible. Due to the flexibility of international arbitration as a dispute
resolution mechanism, situations may arise where a policy that seemingly
appears to be pro-arbitration may in fact be anti-arbitration, or vice versa.
While the starting point for any discussion regarding the friendliness of a legal
system to international arbitration is whether a legal system allows private
parties to resolve their cross-border disputes through arbitration, allowing
recourse to the national court either before, during, or after an arbitration
sometimes creates a dilemma in determining whether a system is pro-
arbitration or not. Prof. Bermann explains this dilemma in his article by
referring to the “well-documented example [of] access to national courts for
interim relief prior to or during the pendency of arbitral proceedings.”
In the past, the turning to national courts for any form of relief was perceived
to be a hindrance to arbitration. Not anymore, however, as Prof. Bermann has
very rightly noted that there is now a broad consensus that the availability of
interim relief from a court is compatible with the notion of arbitration. This
* Tolu Obamuroh is an Associate in the International Arbitration Group of White & Case LLP.
The views presented in this essay do not necessarily reflect the position of White & Case or its
clients. The author thanks Elizabeth Oger-Gross (Partner, White & Case) for reviewing the draft
of this essay. The author also thanks Mohit Marla and Vamika Puri (Stagiaires, White & Case),
for their assistance in the finalization of this essay.
565
essay addresses this dilemma in the context of party autonomy, and posits that
the imposition of limitations on party autonomy, or allowing recourse to national
courts, is not necessarily not pro-arbitration.
II. PARTY AUTONOMY IN INTERNATIONAL ARBITRATION
Party autonomy, one of the main attractions of arbitration, can be defined

as the possibility for parties to choose the law and procedure that governs the
resolution of their dispute. The significance of party autonomy in international
arbitration is evident from the fact that it is a principle that has found its place
not only in national laws, but also in arbitral rules, and even in the two most
important international arbitration frameworks, i.e., the New York Convention,
1958, and the UNCITRAL Model Law, 1985. Prof. Bermann argued that the extent
to which a policy or practice ensures consent to arbitrate and enhances party
autonomy is one of the ways of gauging whether a policy should be deemed as
pro-arbitration. As a cardinal principle of international arbitration, the
principle of party autonomy is relevant and must be respected throughout the
arbitral proceedings: (A) before the commencement of arbitration; (B) after
the commencement of arbitration; and (C) after the arbitral award has been
rendered.
A. Before the Commencement of Arbitration
In the stages before an arbitration is commenced, the parties, in the exercise

of their consent to arbitration, are free to agree in their arbitration agreement
the various aspects of the arbitral proceedings. They may freely agree to have
their arbitration proceedings governed by any particular arbitral rules, or by
ad hoc “tailor-made” procedures. Parties frequently agree on the number of
arbitrators, their qualifications, the procedural mechanism of their appointments,
the default mechanism of appointment to be followed if the agreed mechanism
of appointment fails, and the time limits within which the arbitral award must
be rendered. They may also agree on the seat of their arbitration, the law that
would govern their arbitration agreement, the language of the proceedings, etc.
Despite the wide berth of party autonomy afforded to parties, it is not infinite
and is subject to limitations. One such limitation is that the procedure chosen
by the parties must comply with the mandatory rules of law encompassed in
the law governing the conduct of the arbitration, i.e. the lex arbitri. Parties’ hands
are tied in this regard as they are not permitted to exclude or modify the
mandatory rules provided under the legislation governing the conduct of the
arbitration. Apart from mandatory rules contained in the law of the arbitration
agreement and the law governing the conduct of the arbitration, arbitral rules,
if selected, may also circumscribe party autonomy to some extent. For instance,
the ICC Arbitration Rules, 2021 provide that: “Notwithstanding any agreement
by the parties on the method of constitution of the arbitral tribunal, in exceptional
PARTY AUTONOMY, COURTS’ INTERVENTION AND “PRO-ARBITRATION” POLICY 567
circumstances the Court may appoint each member of the arbitral tribunal to
avoid a significant risk of unequal treatment and unfairness that may affect the
validity of the award.” This provision clearly gives preference to the principle
of party equality over party autonomy.
Nevertheless, this sort of limit on party autonomy cannot be described as
being anti-arbitration. As Prof. Bermann explains in his article, there are
certain tradeoffs that need to be made when attempting to balance the private
right to arbitration with important values that are largely external to international
arbitration itself. The example provided in this regard is the International Bar
Association Guidelines (IBA) on Conflicts of Interest, compliance with which
imposes onerous conflicts checks, undoubted delays and complications in the
arbitral practice. Yet, the guidelines are widely regarded as justified in the
interest of fundamental fairness, a broader legal norm, and societal values.
Prof. Bermann further bolsters this argument by reference to the acceptance
of the IBA Guidelines on Party Representation, despite their subjecting “the
procedural autonomy positively associated with arbitration to limitations in the
form of a commitment to professional ethics and professionalism more broadly.”
B. After the Commencement of Arbitration
Once the arbitration is commenced, the parties still command some control
over the arbitration procedure—albeit in a less commanding position as they
were before the commencement of the proceedings. Their power to agree upon
and determine the procedure of the arbitration is somewhat circumscribed after
the appointment of the arbitral tribunal—who then controls the proceedings.
One possible explanation for this shift in power is that after being appointed,
the arbitrator becomes a party to the arbitration agreement and thus the parties
themselves cannot unilaterally change the terms of the arbitration agreement
or decide upon the procedure without the consent of the arbitrator(s).
C. Post-arbitral Award
In some jurisdictions, such as France, Sweden, and Switzerland, parties

have the freedom to agree in advance on excluding the right to seek the setting-
aside of a future arbitral award. However, such a waiver is subject to the
fulfilment of specific conditions under the laws of these jurisdictions. For
example, under Article 192(1) of Chapter 12 of the Swiss Private International
Law Act, in order for such a setting-aside waiver agreement between the
parties to be enforceable, “none of the parties has [to have] its domicile, habitual
residence, or seat in Switzerland.” Other jurisdictions, such as the United Kingdom,
India, and Germany, on the other hand, disallow such setting-aside waiver
agreements by the parties. Apart from such agreements, some jurisdictions,
such as Switzerland, allow parties to limit the grounds on which national courts
can set-aside an arbitral award.
III. PARTY AUTONOMY AND THE ROLE OF NATIONAL COURTS
National courts at the lex arbitri play an important role in the context of
arbitration. As Prof. Bermann explains in his article, “[t]he very efficacy of
arbitration depends importantly on the attitudes of other actors, most notably
courts and legislatures … if nothing else, the attitudes of those decision makers
largely determine whether agreements to arbitrate will be respected and
whether arbitral awards will be recognized and enforced.” Indeed, in order for
arbitration to thrive, the regime needs the relevant stakeholders to adopt
practices that are favorable to arbitration.
At the initial stages of the arbitral life cycle, the intervention of a national
court is likely to be perceived as pro-arbitration if such an intervention supports
the ensuing arbitration. Indeed, the role of national courts at this stage is
generally to enforce the arbitration agreement and refer parties to arbitration
in line with the New York Convention. It is not unusual for national courts to
make ancillary orders at this stage, which may touch on the subject matter of
the ensuing arbitration. A court decision at this stage that preserves the ‘res’
of the arbitration is generally perceived as pro-arbitration. In contrast, an
order of a court that hampers the arbitration may be seen as anti-arbitration
since such an order would not be in furtherance of the parties’ consent to
resolve their dispute by arbitration. In the specific context of interim relief, this
may also be the best stage for a court’s intervention to grant urgent relief without
needing to wait for the tribunal to be constituted. As Prof. Bermann recognizes
in his article, “interim relief from a court may … help ensure that the resulting
award will be an effective one, if only because such relief can serve to maintain
the status quo pending arbitration, thereby enhancing the future effectiveness
of the award.”
Once an arbitration has commenced and the arbitral tribunal is constituted,
the role of national courts in a pro-arbitration jurisdiction is curtailed. At times,
however, the involvement of the national courts after the commencement of
arbitration is necessary to ensure the proper conduct of the arbitration
proceeding. For instance, the national courts may be asked to assist in taking
evidence, or to make an interim order for the preservation of property, which
is the subject matter of the dispute, or to make any other interim orders of
protection.
After an award has been made, the only recourse under most arbitral laws
is to apply to the national courts at the seat to set aside an award, or to argue
before courts that enforcement should be refused. The grounds for the former
can be limited, e.g., Article 34 of the UNCITRAL Model Law provides for specific
grounds on which an arbitral award can be set aside. As for the latter, national
courts may refuse enforcement of an award on the limited grounds set out in
the New York Convention, 1958, or under the relevant arbitral law.
It is thus clear that the extent of party autonomy upheld or curtailed by the
national courts depends on the circumstances. On the one hand, courts uphold
party autonomy by e.g., enforcing the arbitration agreement of the parties and
the resulting arbitral award, whereas, on the other hand, courts curtail party
autonomy by e.g., setting aside an award on the basis of its being against the
public interest. As noted earlier, any such limitation may not necessarily be
perceived as anti-arbitration if done in a way that is proportionate to the
“extrinsic considerations” of international arbitration, as Prof. Bermann described
it in his article.
IV. ENFORCING PARTY AUTONOMY: DOES IT LEAD TO BEING PRO-

ARBITRATION?
This section addresses the inevitable side effects of enforcing party autonomy
with no limitations.
A. Independence and Impartiality
Independent and impartial arbitrators are crucial to the legitimacy of the

arbitral process. One of the downsides of enforcing party autonomy without
any limits is that it may lead to the appointment of non-independent or partial
arbitrators, which chips away at the legitimacy of the arbitral process and its
outcome. The obligation of independence and impartiality is reflected in
national arbitration laws, international conventions, and arbitral rules. These
requirements are usually enforced through the arbitrators’ ongoing duty of
disclosure. Any failure on the part of the arbitrators might lead to a challenge
during the course of arbitration proceedings. A failure to disclose may also be
the basis of a set-aside proceeding or a ground to resist the enforcement of an
award. Under both the New York Convention and the UNCITRAL Model Law,
an award can be set aside where the tribunal’s composition was not in
accordance with the parties’ arbitration agreement, or where it is against
public policy. National courts may set aside or refuse enforcement of an award
under these grounds if it is shown that the arbitral tribunal was biased or partial.
Therefore, the limits in national laws aimed at promoting the independence
and impartiality of arbitrators promote the legitimacy and, ultimately, the
efficacy of international arbitration.
B. Procedural Efficiency
Parties to international arbitration are afforded flexibility to customize the

procedure for their arbitrations. However, that freedom is bounded by the
procedural discretion of arbitrators to manage the arbitral process in a legitimate
and efficient manner. One of the criticisms of international arbitration according
to the 2021 International Arbitration Survey: Adapting Arbitration to a
Changing World, published by White & Case and Queen Mary University of
London (Survey) is the tendency of arbitrators to fail to take measures that
promote efficiency of arbitration, in terms of cost and time, due to their “due
process paranoia”.
Respondents to the Survey suggested a number of practical ways to make
arbitration more efficient, such as imposing page limits on written submissions
and awards, abandoning or using more judiciously early case management
conferences, and making more considered/effective use of technology to enable
a switch to electronic document production and the conduct of procedural
(and some substantive) hearings virtually. To the extent that these suggested
measures are equally applied to all parties to an arbitration, they in no way
violate the principles of due process in arbitration, even if they impose some
limits on party autonomy. When properly applied, these measures promote
efficiency in international arbitration and are pro-arbitration.
C. Diversity in Arbitral Appointments
One of the main features of party autonomy is that it grants parties an

opportunity to select arbitrators of their choice, typically with the assistance
of lawyers. In international arbitration, often the final decision is left to the in-
house counsel—who make the final choice based on a potential list of
arbitrators that is often provided by outside counsel. One of the predictable
consequences of such freedom of choice, as indicated by the Survey, is a lack of
diversity in arbitral appointments, based on gender, age, geography, race, or
ethnicity. There is an inherent conservatism in appointments with in-house
counsel not wanting to be blamed if things go wrong—they thus tend to prefer
candidates with the appearance of presenting least risks, and those candidates
are perceived to be the ones with the most experience; the ones with the most
experience are, usually, older, white men for the simple reason that we live in
a world with, at the very least, a strong legacy of racism and sexism. Indeed, it
is easy to see how party autonomy in this regard can cause imbalance of
diversity in the constitution of arbitral tribunals.
The significance of diversity in international arbitration cannot be
overstated. Diversity in international arbitration does not just serve the altruistic
purpose of promoting a fairer approach to the arbitral decision making process,
it also serves as a bulwark against the risk of cognitive biases and group-
thinking by international arbitral tribunals. In this regard, while there is no
actual restriction on parties’ freedom to continue to select arbitrator(s) of their
choice as they currently do, the efforts to promote diversity in international
arbitration might be deemed as hampering the freedom of parties to appoint
arbitrators as they desire. However, diversity in arbitral appointment serves
the overarching purpose of promoting arbitral efficacy and places no real limit
on party autonomy.
V. CONCLUSION
Prof. Bermann’s analysis of the measures of what qualifies a policy as pro-

arbitration is key to understanding the objectives of international arbitration
and to what extent legal systems are keeping faith with those objectives. With
his characteristic clarity, Prof. Bermann explains the complicated aspects of the
highly theoretical concept by explaining the “trade-offs” between unlimited
party autonomy and measures that promote arbitral efficacy. This essay hopes
to contribute to this discussion with a specific focus on party autonomy and
the intervention of national courts in international arbitration.
It is true that party autonomy is the heart and soul of international
arbitration. However, an unlimited party autonomy poses numerous problems
in international arbitration, which, as discussed above, threatens the overall
essence and objective of international arbitration. To avoid this unpleasant
outcome, national laws and courts, as well as arbitral institutions, have devised
mechanisms to avoid the abuse of party autonomy. To the extent that these
mechanisms serve to promote the overarching objective of international
arbitration as a means of resolving cross-border disputes in a time and cost
effective way with minimal intervention of national courts, they are hardly
anti-arbitration. Of course, the proof is always in the pudding, but the correct
approach, which helps international arbitration live up to its promise, is
maintaining the right balance between enforcing party autonomy and
imposing on it the requisite limits. This way, legitimacy concerns as a result of
the imposition of such limits are allayed. As Prof. Bermann explains in his
article, a policy “may legitimately be regarded as in itself decidedly arbitration-
friendly, notwithstanding the fact that it … curtails party autonomy, invites
judicial intervention … or sacrifices in some other way what we traditionally
associate with arbitration-friendliness.”
Chapter 102
ARTIFICIAL INTELLIGENCE ARBITRATION
Tyler Jankauskas*
As Professor Bermann observes in his article on the pro-arbitration idea,

arbitration lawyers are uniquely concerned not just with their cases, but with
the ecosystem of arbitration at large. Unlike domestic court litigation, which
benefits from sticky institutional rules, commercial arbitration’s reliance on
party choice requires heightened attention to its own well-being.
This concern makes arbitration fertile ground for legal innovation, not least
in terms of legal technologies. For instance, the potentials of artificial intelligence
(AI) for arbitration have been increasingly considered in articles and panels
over the past few years. The discussion has, however, been dominated by
technical considerations—technological and legal potentials and roadblocks,
rather than normative questions geared towards the health of arbitration as a
legal system.
To satisfy this oversight, and to refine our understanding of what AI
arbitration has to offer, Professor Bermann’s framework is indispensable. If
Professor Bermann’s clarion call is to rationalize and analyze what have hitherto
been pro- and anti-arbitration labels affixed by unexamined intuition, AI
arbitration is an especially apt subject. The questions AI arbitration raises are
exceedingly rich, ranging from the nitty-gritty of implementation to lofty and
perennial questions concerning what constitutes (good) legal decision-
making. This breadth of range is matched only by a depth of prejudice. Artificial
intelligence occupies the public imagination as a double-edged sword, as the
playful promise of The Jetsons and the nightmare of Skynet. Professor
Bermann’s framework helps us set these phantoms aside, and concentrate on
building the future.
I. WHAT DOES ARTIFICIAL INTELLIGENCE ARBITRATION LOOK LIKE?
Defining artificial intelligence is no simple task, reflecting its reliance on

the ineffable concept of “intelligence.” While some technical definitions focus
on adaptability, machine-learning, or perceived intelligence, in practice artificial
intelligence is more a social term than a technical one. Simply put, a machine
earns the “artificial intelligence” moniker not through meeting some exact
metric, but by convincing the social world that its capabilities approximate
something more intelligent than mere computation.
* Tyler Jankauskas practices international arbitration and commercial litigation in New
York. He earned his J.D. from Columbia Law School in 2021.

573
The term artificial intelligence attaches itself to a variety of tools already

used in legal practice. Each of these earns its title through perceiving a
situation or environment, and then developing a useful set of predictions,
recommendations, or decisions. Tools range from smart-search legal research
assistance, algorithmic discovery management, and arbitrator selection.
Of course, the stuff that dreams are made on is not the tools that reduce
research or discovery burdens; it is AI decision-making. While the lofty goal
may be arbitrations totally run by artificial intelligence, it is more likely that AI
tools are adopted in a hybrid manner. AI tools could be used for subsets of
issues, freeing human arbitrators to consider more delicate ones.
Alternatively, AI tools can take the place of expert determinations, providing
an arbitrator with decisions to adopt or with a range of outcomes that reduce
an arbitrator’s burden.
II. IS ARTIFICIAL INTELLIGENCE ARBITRATION PRO-ARBITRATION?
The idea of machine-produced legal decision-making can seem daunting,

with even the most utopian among us recognizing the risk of pitfalls. To begin
consideration, we should first recognize the many ways of framing the
question of AI’s pro- or anti-arbitration attributes. While the below considers
AI arbitration generally, more acute analyses may be offered on more acute
questions. One can ask, are rules requiring a human arbitrator pro-
arbitration, either as mandatory or default rules? Is AI used for expert
determination, or for partial awards, pro-arbitration? Is the adoption of AI as
a quality control filter by arbitral institutions pro-arbitration? For the sake
of this short note, the following discussion will avoid the particulars and
instead focus on the core costs and benefits that AI offers to legal decision-
making in arbitration.
AI adjudication checks several pro-arbitration boxes. Automated decision-
making may drastically reduce time and cost of arbitration by reducing not just
the time it takes an arbitrator to decide a matter, but also myriad logistical
costs. The independence and impartiality of an AI arbitrator is an additional
factor in favor. With complete automation, conflict issues would fall to the
wayside, with parties instead focusing on what AI service should arbitrate a
dispute or issue.
Achieving party intention is slightly more nuanced. While it is hard to
imagine a completely AI-run arbitration occurring without party consent,
arbitrator use of AI tools could plausibly take place in the absence of specific or
explicit party intent. Today such use would almost certainly surprise parties. So
long as arbitrators use AI tools as an aid, with the adoption of any
algorithmically generated outcome explained and rationalized in legal terms,
then arbitrators will remain the ultimate decision-makers, in accordance with
party intent.
ARTIFICIAL INTELLIGENCE ARBITRATION 575
At the same time, the adoption of AI poses several costs, some contingent
and some inherent to the use of AI. Insofar as imperfect technology is used, the
adoption of AI risks skewed outcomes, affecting accuracy. While a human
arbitrator may disregard a case whose rationale and decision are clearly wrong,
a faulty algorithm may take such a data point and re-apply it, perpetuating a
skewed outcome.
AI also has costs that are inherent to its use. For instance, automation’s
elimination of potential bias is matched with a reduction in discretion and
flexibility. A machine may simply fail to perceive extenuating or unique
circumstances. Additionally, insofar as different jurisdictions adopt rules
hostile to the use of AI, AI-issued awards may risk enforcement issues. Currently,
both France and the Netherlands require human arbitrators, and it is unclear
what these jurisdictions would do at the enforcement stage for AI-issued awards.
In this regard, enforcement concerns link up with the right to be heard.
Scholarship shows that the satisfaction of having one’s day in court (or before
a tribunal) is not just a right, but a keystone of sociological legitimacy, and thus
requisite for any successful opt-in dispute resolution system. Insofar as AI
arbitration reduces the feeling of having one’s case satisfactorily heard, or
provides decisions with under-articulated black-boxed rationales, these
characteristics would be anti-arbitration.
Where do these competing factors leave AI arbitration? Unfortunately, the
above is too preliminary to decide where the balance of these factors leads, not
least because it considers general AI attributes rather than particular technologies
or rules. That said, Professor Bermann’s framework does more than guide
analysis. Legal technology developers would be well to flip the framework on
its head, using it as a forwarding looking guide for the development of AI tools
and corresponding rule suggestions.
For instance, AI arbitration is well-situated to help solve, or at least
mitigate, issues stemming from the recent surge in mass arbitrations. Changing
laws and technologies have rendered high-volume, low-value consumer
arbitration claims problematic for companies. Some companies have even
limited arbitration clauses rather than face the wave of cases. While some
coordination and consolidation mechanisms have worked their way into
arbitration agreements and procedure, AI arbitration may offer another way
out. The duplicative nature of mass arbitration claims facilitates algorithmic
decision-making, and the typically low value of such claims means that drastically
reduced legal costs should offset any noise around the edges of damage
determinations. Developers would do well to attend beyond technical
capabilities, but to the pro-arbitration elements that developing technologies
may instantiate. This requires an algorithm, one contextualized in legal rules
and practices that renders the use of such an algorithm pro-arbitration.
* * *
I had the rare pleasure of attending a course taught by Professor Bermann

each of my three law school years. Perhaps at the most fundamental, he teaches
not just the virtues of lawyering, but the virtues of shepherding the project of
international arbitration. While what it means for a rule or policy to be pro-
arbitration is explained in his article, what it means to be pro-arbitration
vocationally is carried in his character.
Chapter 103
INTERNATIONAL COMMERCIAL ARBITRATION
AND CLIMATE EMERGENCY: IN SEARCH OF
“GREENER” TIMES
Valentin Rougier*
I. INTRODUCTION
Every second counts. In February 2022, the Intergovernmental Panel on

Climate Change, a body of experts convened by the United Nations, published
a dire report on the devastating effects of unbridled climate change. This more
than 3,600-page warning concluded, inter alia, that any further delay in
concerted global action will result in irreversible impacts on ecosystems,
biodiversity, and vulnerable populations. In this Zeitgeist, a holistic reaction
from every actor—spanning not just private companies and States, but the
international arbitration community too—is essential to tackle the key challenge
of the 21st century.
Hitherto little discussed or addressed by those who practice international
commercial arbitration, the issue of climate emergency is no longer being
sidestepped. Whether directly or indirectly, recent years have shown that climate
change can result in disputes. These are already being brought before
numerous arbitral tribunals, and their number has steadily increased. This is
perhaps unsurprising since nowadays virtually every commercial contract could
have an environmental impact. The inherent features of international commercial
arbitration suggest that it is a well-suited forum to address such disputes.
Professor George A. Bermann routinely mentions that international
arbitration does not operate in a vacuum. It must deal with extrinsic
considerations that are socially valued—notably, the protection of the
environment. As a matter of fact, the legitimacy of international arbitration also
depends on its very capacity to be at the forefront of environmental challenges
that transcend the parties’ private interests. This paradigm can be linked to the
new expectations of society at large, which embraces pro-environmental
practices and expects the arbitration community to do the same and develop a
genuine awareness of environmental issues.
There is a unique opportunity for international commercial arbitration to
have both a positive impact on environmental protection and to further
strengthen its overall legitimacy. This essay presents the role that international
* Valentin Rougier is an Associate at Jones Day. The views expressed in this essay are those
of the author alone and do not necessarily reflect the views of the author’s firm or any of its
clients.
577
commercial arbitration can play in addressing climate change-related disputes

(II), and discusses the challenges of balancing “pro-arbitration” objectives in the
context of climate emergency (III). Acknowledging the extrinsic considerations
which international commercial arbitration must face, this essay further
investigates the extent to which reducing the impact of arbitration proceedings
could become a “pro-arbitration” practice (IV).
At the outset, however, two caveats. First, State-State disputes before
international fora, such as the International Court of Justice or the International
Tribunal for the Law of the Sea are not addressed in this essay. These dispute
settlement mechanisms are indeed reserved for States and are of little relevance
to private actors. In addition, this essay will focus on international commercial
arbitration, although significant developments with respect to environmental
considerations must be noted in recent Investor-State cases.
II. INTERNATIONAL COMMERCIAL ARBITRATION: AN APPROPRIATE

FORUM FOR CLIMATE JUSTICE?
The current legal framework relating to climate change is composed of

more than 3,100 laws and regulations worldwide. In such a fragmented system,
an intriguing question is the extent to which international commercial arbitration
can serve as a forum for climate justice. The pioneering ICC Report on Resolving
Climate Change Related Disputes through Arbitration and ADR published in
2019 broadly defines climate-related disputes as any dispute arising out of, or in
relation to, the effects of climate change and various climate change instruments.
Although the implications of global warming are manifold, there are three
main categories of contracts that could lead to climate change-related disputes.
First, contracts related to specific transition, adaptation, and mitigation
commitments. Second, submission agreements that were entered into once a
climate change-related dispute has crystallized. Finally, contracts that do not
have any specific climate change-related purpose, but whose performance
was—directly or indirectly—impacted by climate change. The latter category
of contracts is likely to generate the most impact on international commercial
arbitration since energy or infrastructure contracts for example typically
include arbitration agreements. In fact, as the ICC notes, disputes arising from
these sectors generated the largest number of new international commercial
arbitration cases, and—more importantly—their number is expected to keep
increasing in the coming years.
Climate change-related disputes arising out of such contracts are complex,
politically sensitive and cross-border by nature. Accordingly, the inherent virtues
of international commercial arbitration make it a unique vehicle for addressing
such disputes. These notably include great procedural flexibility, choosing
independent and impartial arbitrators, as well as benefitting from the
longstanding experience of the arbitral community. Innovative arbitration
mechanisms are also appealing in the context of climate emergency, such as
INTERNATIONAL COMMERCIAL ARBITRATION AND CLIMATE EMERGENCY 579
the ability to obtain interim relief under emergency arbitration procedures.

Last but not least, the global recognition and enforcement of arbitral awards
under the New York Convention is another valuable feature making international
commercial arbitration a first-rate mechanism for climate-related dispute
resolution.
III. BALANCING “PRO-ARBITRATION” OBJECTIVES IN A CLIMATE

EMERGENCY CONTEXT
While the specific features of international commercial arbitration make it

an appropriate forum for addressing climate change-related disputes, a
number of “pro-arbitration” objectives must be balanced. In this respect, the
extension of arbitration agreements to non-signatories is of particular interest.
Since international commercial arbitration is consensual by nature, an arbitral
tribunal could not exercise jurisdiction over a dispute—related to climate
change or not—without the valid consent of the parties as reflected in an
arbitration agreement or a compromis.
Third parties, however, can be adversely affected by the consequences of
climate change, and as such may wish to participate in arbitration proceedings.
Although there are legitimate reasons for accepting participation of non-
signatories, this is still subject to the consent of the parties. Party autonomy
also means that they can be creative and adopt innovative procedures tailored
for climate change-related commercial arbitrations, such as by limiting third
parties’ participation to some issues, or perhaps, drawing upon the investment
arbitration experience, by allowing amicus curiae submissions.
One may point out that the role of an arbitral tribunal is not to protect the
environment, but only to determine which party to a dispute should bear the
cost of certain contractual obligations. On the other hand, arbitrators often
balance private and public interests while meeting the expectations of the
parties, deciding the points in dispute, and rendering an enforceable award at
the same time. These considerations are certainly complex to accommodate—
albeit not impossible. Moreover, in the absence of an express choice of law by
the parties, arbitrators may depart from traditional conflict of law rules to
consider public and private interests in climate change-related cases. A further
question to contemplate is the potential non-arbitrability of certain climate
change-related disputes on public policy grounds.
In addition, one of the most challenging trade-offs relates to the confidential
nature of international commercial arbitration. Although this feature is often
perceived as an advantage by the parties, it is also a challenge in the context of
climate change-related disputes. There are indeed few published commercial
arbitration awards, whilst many of them have a significant and direct public
interest component. The international arbitration community, however, is
striving for greater transparency. For example, the ICC has recently improved
the accessibility of arbitral awards, which may be published two years after
they are rendered, except in cases where the parties are bound by a
confidentiality agreement or object to such publication.
IV. MITIGATING THE ENVIRONMENTAL IMPACT OF ARBITRATION

PROCEEDINGS: A “PRO-ARBITRATION” PRACTICE
International arbitration could be “greener.” As a matter of fact, the carbon

footprint of current arbitration proceedings—especially the widespread use of
air travel or the large number of documents printed in preparation for a
hearing—is a significant concern in the context of climate emergencies. For
example, a study estimated that approximately twenty thousand trees—or the
entire tree population of Central Park in New York—are needed to offset the
carbon emissions of a medium-sized arbitration.
International arbitration practitioners have launched noteworthy initiatives
to reduce the environmental footprint of arbitration proceedings, such as the
“Green Pledge”—signed by more than a thousand members of the arbitral
community. These initiatives promote environmentally friendly practices which
have been widely implemented during the Coronavirus pandemic, such as
reducing unnecessary air travel, using videoconferencing and hybrid hearings,
or generalizing the use of electronic bundles. No new technology is required, but
simply a willingness to use the tools already available to arbitration practitioners.
Arbitral institutions, too, are developing specific guidelines, model clauses
or procedures for climate change-related arbitrations in order to address some
fundamental lacunae. For example, the PCA Optional Rules for Arbitration of
Disputes Relating to Natural Resources and/or the Environment have
established a list of arbitrators with climate change expertise that parties can
appoint to ensure optimal outcomes in this regard. While the lack of technical
expertise of the tribunal is often identified as a concern in the context of
climate change-related disputes, such a roster offers a valuable and efficient
response.
Moreover, another arbitral institution, the SCC, issued revised arbitrator
guidelines providing details on reimbursable travel-related expenses, which
now explicitly include the standard costs of climate compensating for the
arbitrators’ flights. More generally, carbon-offsetting expenses are starting to
be recovered before different arbitral institutions. All these elements
emphasize that the international arbitration community is self-reflective and
constantly questions its own functioning. There is indeed a genuine link
between “greener” and more effective arbitrations.
V. CONCLUSION: PRO-ENVIRONMENTAL VALUES AND THE

LEGITIMACY OF INTERNATIONAL COMMERCIAL ARBITRATION
Environmental issues have become prominent in international commercial

arbitration, which has proven to be a particularly appropriate forum for
INTERNATIONAL COMMERCIAL ARBITRATION AND CLIMATE EMERGENCY 581
addressing such disputes. This sole success, however, is not sufficient if it does
not come with a global effort to address environmental threats. Climate
emergency calls for a more holistic response from the international arbitration
community. There is an urgent need for stronger synergies to exchange best
practices—and significantly reduce the carbon footprint of international
International commercial arbitration has much to offer to address climate
change-related disputes. “Greener” initiatives emphasize practitioners’ increasing
awareness and enhance this mechanism’s credibility and suitability for such
disputes. In the future, it may be relevant to go even further and create a shared
database of climate change-related disputes addressed by international
commercial arbitration—similar to the U.S. and Global Climate Change Litigation
Databases launched by the Columbia Law School Sabin Center for Climate
Change Law.
Promoting values that are extrinsic to international commercial arbitration,
especially environmental protection, is in the best interest of the arbitral
community—and the Earth. At stake is the legitimacy of international
commercial arbitration. For decades, Professor Bermann has taught that society
embraces fundamental values that go beyond—and outweigh—the mere
interests of international commercial arbitration. And rightly so—it is now
arduous to conceive a more fundamental value than the respect for the
environment, and protecting it is perhaps the greatest way to be “pro-
arbitration” in the most “bermannian” sense.
Chapter 104
WHAT DOES IT MEAN TO BE “PRO-
ARBITRATION”?: EFFECTUATING PARTY INTENT
IN CONSTRUING AN ARBITRATION AGREEMENT
YiKang Zhang*
I. INTRODUCTION
It is uncontroversial that a measure is “pro-arbitration” if it promotes the

legitimacy of international arbitration as a dispute resolution mechanism.
However, as Bermann recognised, the determination of whether a measure is
“pro-arbitration” is far from straightforward. There is a multiplicity of metrics
for evaluating whether a measure has a positive or negative effect on the
legitimacy of arbitration. These metrics may further be at cross-purposes, such
that a measure may have a positive impact on the legitimacy of arbitration in
one respect but damage it in other respects (George Bermann, What Does it
Mean to Be “Pro-Arbitration”?, (2018) 34 Arb Int’l 341, pp. 342, 344).
There is a further challenge in assessing whether a measure is “pro-
arbitration”: there may be legitimate differences in the interpretation of a
single evaluative metric.
A prominent example of such differences can be found in the decisions of
the UK Supreme Court in Enka Insaat Ve Sanayi AS v. OOO Insurance Company
Chubb [2020] UKSC 38 and the Singapore Court of Appeal in BNA v. BNB and
BNC [2019] SGCA 84. In both cases, the Courts considered the principles for
determining the law of the arbitration agreement. Both Courts agreed that, in
the absence of an express choice by the parties, a clause specifying the governing
law of the contract should generally be construed as an implied choice of law
in relation to the arbitration agreement (Enka, ¶ 170(iv); BNA, ¶ 47).
In Enka, the UK Supreme Court also had to consider whether the likely
invalidity of the arbitration agreement under the governing law of the contract
could negate the assumption that it was the implied choice of law of the
arbitration agreement, and be replaced by the assumption that the arbitration
agreement was governed by the law of the seat. The Court concluded that it
could, as the parties are unlikely to have chosen to invalidate the arbitration
agreement (Enka, ¶ 170(vi)).
In BNA, the Singapore Court of Appeal had to consider the antecedent
question of whether the likely invalidity of the arbitration agreement under
* YiKang Zhang is an Associate at Three Crowns LLP. Any opinions expressed in this essay
are his own.

583
the governing law of the contract should be taken into account in construing
the parties’ choice of the seat (whose law may then displace the governing law
of the contract as the implied choice of law of the arbitration agreement). The
Court concluded that it should not be taken into account, unless the parties
were at least “aware that the choice of proper law of the arbitration agreement
could have an impact upon the validity of the arbitration agreement” (BNA, ¶ 90).
These determinations by the UK Supreme Court and the Singapore Court of
Appeal were driven by the same aim of effectuating the parties’ intent. However,
the Courts arrived at different conclusions.
This short essay analyses the different approaches adopted by these Courts
in seeking to effectuate party intent. Section II summarises the decisions in
Enka and BNA. Section III explains the different interpretations of “party intent”
adopted by the UK Supreme Court and the Singapore Court of Appeal which
underpin these decisions. It then argues that the approach of the Singapore
Court of Appeal adheres more closely to the parties’ intention, while the
application of a “‘pro-arbitration’ presumption” by the UK Supreme Court may
in fact be motivated by another supposed “pro-arbitration” consideration—to
increase the use of arbitration. The latter approach, while increasing the use of
arbitration in specific cases, may negatively affect the legitimacy of arbitration in
the long-run.
II. DECISIONS OF THE UK SUPREME COURT AND SINGAPORE COURT OF

APPEAL
A. The UK Supreme Court in Enka v. Chubb
Enka was a sub-contractor for the construction of a power plant in Russia.

In February 2016, the power plant was severely damaged by fire. The owner
of the power plant made a claim under its insurance policy and subrogated to
the insurer, Chubb, any rights to claim compensation from third parties for
damage caused by the fire (Enka, ¶¶ 7–8, 12).
The construction contract provided for London-seated arbitration under
the ICC Rules (Enka, ¶ 10). However, in May 2019, Chubb filed a claim against
Enka and others in the Moscow commercial court for alleged damage caused
by the fire (Enka, ¶ 13). In September 2019, Enka sought an anti-suit injunction
before the Commercial Court in London in respect of the Russian proceedings.
The Commercial Court dismissed Enka’s claim primarily on the basis that the
appropriate forum to decide whether Chubb’s claim fell within the scope of the
arbitration agreement was the Moscow commercial court (Enka, ¶¶ 17–18).
The Court of Appeal overturned this decision and issued the anti-suit injunction,
finding inter alia that the law of the arbitration agreement was English law
(Enka, ¶ 189). Chubb appealed.
The Supreme Court took this opportunity to set out the principles for
determining the law of an arbitration agreement. It held that the law of an
EFFECTUATING PARTY INTENT IN CONSTRUING AN ARBITRATION AGREEMENT 585
arbitration agreement is “(a) the law chosen by the parties to govern it or

(b) in the absence of such a choice, the system of law with which the arbitration
agreement is most closely connected” (Enka, ¶ 170(ii)).
The Court also explained that where there is no express choice of law of
the arbitration agreement, “a choice of governing law for the contract will
generally apply to an arbitration agreement which forms part of the contract”
as an implied choice of law by the parties. However, and importantly for this
chapter, the Supreme Court noted that “[a]dditional factors … may … negate
such an inference and may in some cases imply that the arbitration agreement
was intended to be governed by the law of the seat”, including “the existence
of a serious risk that, if governed by the same law as the main contract, the
arbitration agreement would be ineffective” (Enka, ¶¶ 170(iv) and (vi)).
In identifying this “additional factor”, the Court recognised that it was
applying a “‘pro-arbitration’ presumption.” Quoting Born, it explained that this
presumption, “[d]erived from the policies of leading international arbitration
conventions and national arbitration legislation, and from the parties’ likely
objectives” provides that “a valid arbitration clause should generally be
interpreted expansively and, in cases of doubt, extended to encompass
disputed claims” (Enka, ¶ 107 (quoting Gary Born, International Commercial
Arbitration (2nd ed., 2014), p. 1403)). The Court also referred to the “validation
principle” under English law that “the contract should be interpreted so that it is
valid rather than ineffective”—a principle that was applied by the Court of Appeal
in Sulamérica when construing an arbitration agreement (Enka, ¶¶ 95–97,
101–105 (discussing Sulamérica Cia Nacional de Seguros SA & Ors v. Enesa
Engenharia SA & Ors [2012] EWCA Civ 638)).
Turning to the circumstance in which no choice was made by the parties,
the Court observed that the law with which the arbitration is most closely
connected “will generally be the law of the seat” (Enka, ¶ 170(viii)).
Applying these principles to the specific construction contract, the
Supreme Court held that the arbitration agreement was governed by English
law. It reasoned that there was no express or implied choice of law of the
arbitration agreement. Thus, the law of the seat—as the law most closely
connected with the arbitration—applied (Enka, ¶ 171).
B. The Singapore Court of Appeal in BNA v. BNB
BNA was the seller of industrial gases under a Takeout Agreement. BNB
and BNC were the buyers. The Agreement was governed by the laws of the
People’s Republic of China (PRC) and disputes were to be “submitted to the
Singapore International Arbitration Centre (SIAC) for arbitration in Shanghai”
(BNA, ¶ 12).
In 2016, the buyers commenced an SIAC arbitration against BNA for failing
to make certain payments under the Agreement. BNA challenged the tribunal’s
jurisdiction, arguing that the law of the arbitration agreement was PRC law and
thus the arbitration agreement was invalid. The tribunal dismissed BNA’s
objection, finding that while PRC law was the presumptive law of the arbitration
agreement, this was displaced by Singapore law because PRC law might
invalidate the arbitration agreement (BNA, ¶¶ 13–19).
BNA then applied to the Singapore High Court for a declaration that the
tribunal lacked jurisdiction. The High Court dismissed the application. The High
Court reasoned that the reference to “arbitration in Shanghai” was a selection
of venue. In the absence of a chosen seat, the SIAC rules provided that
Singapore was the seat of the arbitration (BNA, ¶ 30). The High Court then
referred to the principle set out in BCY v. BCZ [2016] SGHC 249, i.e., that the
governing law of the contract is a strong indicator of the governing law of the
arbitration agreement unless there are indications to the contrary. The High
Court found that there were indications to the contrary in this case. In particular,
the arbitration agreement would be invalid if the governing law of the contract
applied. Thus, it was displaced by the law of the seat (Singapore law) as the
parties’ implied choice of law of the arbitration agreement, which meant that
the tribunal had jurisdiction to hear the dispute (BNA, ¶ 31). BNA appealed.
In its judgment, the Singapore Court of Appeal set out the principles for
determining the law of an arbitration agreement, which were substantially
similar to the principles set out by the UK Supreme Court in Enka. The court
must first examine if the parties made an express choice of law. If not, the court
examines if the parties made an implied choice, the starting point of which
“ought to be the law of the substantive contract where the arbitration agreement
was integrated into”. If no choice can be discerned, “the system of law with
which the arbitration agreement has its closest and most real connection will
be the proper law” (BNA, ¶¶ 46–48). Applying these principles, the Court of
Appeal held that the arbitration agreement in question was governed by PRC
law because of the parties’ implied choice through the governing law of the
contract. Further, the provision for “arbitration in Shanghai” was a designation
of the PRC as the seat. As the law of the seat and the governing law of the
contract was the same, the question of whether the former should displace the
latter as the parties’ implied choice of the law of the arbitration agreement did
not arise (BNA, ¶¶ 62, 94–95).
In determining that the parties had selected the PRC as the seat, the Court
of Appeal had to address whether the likely invalidity of the arbitration agreement
under the governing law of the contract could be taken into account. Like in
Enka, it was argued that the parties intended to arbitrate their disputes and
would not have chosen to invalidate that agreement (BNA, ¶ 89). Hence, the
PRC could not be the seat of the arbitration. Otherwise, there would be nothing
to displace PRC law as the law of the arbitration agreement, and this would
invalidate the arbitration agreement.
The Court of Appeal rejected this argument. It explained that the likely
invalidity of the arbitration agreement could only be taken into account if “the
parties were, at the very least, aware that the choice of proper law of the
arbitration agreement could have an impact upon the validity of the arbitration
agreement”. In this case, “there is nothing in the evidence to show that the
parties were sensitive to the interplay between PRC law and choosing the SIAC
as the administering institution, much less the invalidating effect of this
particular combination of choices. Instead, the evidence suggests that this
consideration did not operate in their minds at all. It therefore cannot form
part of the context in construing [the arbitration agreement]” (BNA, ¶ 90).
This finding suggests that the Singapore Court of Appeal would have
reached a different decision from the UK Supreme Court if confronted with the
issue in Enka (although the Singapore Court of Appeal indicated that there was
“no need” to consider that issue in BNA (BNA, ¶ 94)). It is difficult to see how
Singaporean courts can take into account the validity of the arbitration agreement
when construing the parties’ chosen law of the arbitration agreement, if it is
not taken into account when construing the parties’ chosen seat of the arbitration
(which could itself affect the law of the arbitration agreement).
III. THE DIFFERENT INTERPRETATIONS OF PARTY INTENT
The opposing views of the UK Supreme Court and the Singapore Court of
Appeal on whether the validity of the arbitration agreement should be taken
into account when construing it is a result of their different interpretations of
the parties’ intention when they incorporate an arbitration agreement into
their underlying contract.
The UK Supreme Court placed greater weight on the parties’ manifest
intention to submit their disputes to arbitration as compared to their implied
choice of law of the arbitration agreement (through their choice of the law of
the contract). The Court thus concluded that “[t]o the extent that a putative
applicable law fails to recognise this presumption that arbitration has been
chosen as a one stop method of dispute resolution, it is inherently less likely
that reasonable commercial parties would have intended that law to determine
the validity and scope of their agreement to arbitrate (rather than litigate)
disputes” (Enka, ¶ 108).
By contrast, the Singapore Court of Appeal placed the parties’ manifest
intention to arbitrate their disputes on equal footing as their implied choice of
law of the arbitration agreement. This is set out most clearly in the introduction
and conclusion to the BNA judgment. The Court emphasised that while the
incorporation of an arbitration agreement into a contract confirms the parties’
intention to arbitrate, “it does not follow that the parties’ manifest intention to
arbitrate must always be given effect to come what may. Ultimately, whether
the parties’ intention to arbitrate should be enforced invariably depends on
the wording and proper construction of the arbitration agreement. What must
not be overlooked is that arbitration agreements, despite the best of intentions
of the parties, can at times be invalid for any one of a variety of reasons” (BNA,
¶ 2). Other aspects of the arbitration agreement, including the parties’ choice
of the seat, arbitral institution and governing law, also reflect the parties’
intentions and cannot be ignored. As the Court explained, “[t]he parties did not
only choose to arbitrate—they chose to arbitrate in a certain way, in a certain
place, under the administration of a certain arbitral institution. Those all have
to be given effect to by a process of construction which critically gives the
words of the arbitration agreement their natural meaning, unless there are
sufficient contrary indicia to displace that reading. If the result of this process
of construction is that the arbitration agreement is unworkable, then the
parties must live with the consequences of their decision” (BNA, ¶ 104).
The approach of the Singapore Court of Appeal thus seeks to effectuate all
of the parties’ intentions and adheres more closely to the aim of effectuating
party intent. It does not elevate the parties’ intention to arbitrate over their other
clear intentions. Instead, it recognises that other aspects of an arbitration
agreement and the underlying contract, including the choice of law of the
contract (and implied choice of law of the arbitration agreement), are also
important expressions of party intent. For example, the law of the contract
(and thus the arbitration agreement) may have been selected based on one party’s
familiarity with that law, in exchange for that party’s compromise on another
part of the agreement. These intentions should not be readily subordinated to the
parties’ intent to arbitrate, unless there is evidence to that effect.
Indeed, as the Court of Appeal recognised, agreements may be “unworkable”
despite the parties’ intentions. While courts may depart from the ordinary
meaning of words in a contract to avoid inconsistencies, the courts’ role is
“limited to identifying and interpreting what the parties have expressly or
impliedly agreed and does not extend to re-formulating or altering the parties’
bargain” (Pluczenik Diamond Co NV v. W Nagel (A Firm) [2018] EWCA Civ 2640,
¶ 34; see also Chitty on Contracts (34th ed., 2021), ¶ 15-094). Thus, “[n]ot only
must it be clear that ‘something has gone wrong with the language’, it must
also be ‘clear what a reasonable person would have understood the parties to
have meant’” (Chitty on Contracts (34th ed., 2021), ¶ 15-094 (quoting Chartbrook
Ltd v. Persimmon Homes Ltd [2009] UKHL 38, ¶ 25)).
Adopting a “pro-arbitration presumption” in construing an arbitration
agreement may lead to inconsistent outcomes. Using the facts in BNA as an
example, consider the situation where there was a change in PRC law during
the course of the contract such that the arbitration agreement became
unenforceable. A court applying the “pro-arbitration presumption” would have
concluded before the change in law that the parties had chosen the PRC as the
seat of the arbitration, but would likely have concluded after the change in law
that the parties had chosen Singapore as the seat. The fact that the application
of the “pro-arbitration presumption” to the same provision can result in
different conclusions, depending on the timing at which the dispute occurred,
indicates that it is not merely seeking to identify the parties’ “clear” intentions.
Indeed, the application of a “pro-arbitration presumption” likely reflects a
consideration of other “pro-arbitration” metrics beyond effectuating party
intent—namely, to increase the use of arbitration as a dispute resolution

mechanism. As Born explains in relation to disputes over the scope of an
arbitration agreement, the presumption ensures that “all [] controversies can
be resolved in a single proceeding (rather than in multiple proceedings in
different forums)” (Enka, ¶ 107 (quoting Gary Born, International Commercial
Arbitration (2nd ed., 2014), p. 1403)). However, parties should be free to agree
to resolve their disputes in different forums if they wish and there may be good
reasons for doing so. For example, contractual parties commonly agree to
refer technical disputes to expert determination, while referring contractual
disputes to arbitration.
Increasing the use of arbitration in specific cases by giving primacy to the
parties’ intent to arbitrate (in the absence of evidence that this prioritisation
was intended) does not promote the legitimacy of arbitration in the long-run.
Sending parties to arbitration even though their implied choice of law of the
arbitration agreement prohibits arbitration in that context defeats their
commercial bargain. It is thus notable that Bermann did not consider increasing
the use of arbitration in itself to be a “pro-arbitration” metric (George Bermann,
What Does it Mean to Be “Pro-Arbitration”?, (2018) 34 Arb Int’l 341, p. 343).
Similarly, the President of the ICC Court has recently cautioned arbitration
practitioners to be wary of bias towards arbitration over “other tools” which
could be more effective in achieving the client’s objectives (Claudia Salomon,
Maslow’s Hammer: An over-reliance on familiar tools, Tel-Aviv Arbitration
Week Keynote, 14 March 2022, pp. 8–10).
IV. CONCLUSION
There are many features of the “pro-arbitration” debate that need to be

explored beyond the identification of relevant “pro-arbitration” metrics. This
essay introduced the debate arising out of the different interpretations adopted
by the Singapore Court of Appeal and the UK Supreme Court in relation to the
key metric of “effectuating party intent.” This essay contends that the approach
of the Singapore Court of Appeal adheres more closely to the aim of effectuating
party intent, while the approach of the UK Supreme Court is motivated by other
supposed “pro-arbitration” considerations. However, these other considerations
may not support the legitimacy of arbitration in the long-run.
Ultimately, this increasingly sophisticated discussion on what it means to
be “pro-arbitration” is reflective of a thriving “pro-arbitration” community and
should be encouraged.
Chapter 105
A “PRO-ARBITRATION” FRAMEWORK FOR
CHOICE-OF-LAW PRACTICES IN U.S. JUDICIAL
ENFORCEMENT OF ARBITRATION AGREEMENTS
Yilin Tim Chen*
PROLOGUE
The inquiry, research, and analysis discussed herein are much indebted to
Professor Bermann. His courses on international arbitration, his leadership in
drafting the Restatement (Third) on the U.S. Law of International Commercial
Arbitration, and his research questions precipitated the survey I conducted to
address my inquiry; his seminal scholarship on “gateway problems” in the
enforcement of arbitration agreements in U.S. courts shed light on how to
analyze seemingly divergent approaches. For such invaluable opportunities
and insights, and most of all, his generous mentorship, I am deeply grateful.
I. INTRODUCTION
Parties resisting arbitration commonly seek intervention from courts on

the ground that the relevant arbitration agreement either suffers from a severe
defect or is nonexistent. When examining an arbitration agreement at the
outset of arbitration, U.S. courts typically adopt one of the following three choice-
of-law approaches: (1) they directly apply the forum’s substantive law regardless
of the parties’ chosen law; (2) they directly apply the parties’ chosen law; or
(3) they apply the forum’s choice-of-law rules to find the applicable law. These
approaches follow a “pro-arbitration” framework that balances party autonomy
in international arbitration and the public policy interests in the judicial forum
where the courts sit.
II. THE CONTEXT OF THIS INQUIRY
The New York Convention and its implementing statute in the United States,
the Federal Arbitration Act (FAA), stipulate the grounds for non-enforcement
of an arbitration agreement, i.e., if the agreement is null and void, inoperative
* Yilin Tim Chen is an Associate in the international arbitration group at Freshfields Bruckhaus
Deringer US LLP. Before joining Freshfields, Tim attended Columbia Law School and worked
with Professor Bermann as his teaching assistant and research assistant. Any views expressed
in the essay are the author’s views and do not necessarily reflect the views of Freshfields or of
its clients.
591
or incapable of being performed. However, neither the New York Convention

nor the FAA specifies the law that defines these grounds. This raises the question:
when a court is deciding whether to enforce an arbitration agreement, what law
should govern the existence or validity of the arbitration agreement, particularly
when the parties have included a substantive choice-of-law clause in their
contract?
The separability doctrine posits that the arbitration agreement is separate
from the underlying contract in which it is found. This provides an important
first step in answering the aforementioned question and does so in two main
ways: first, it elucidates the difference between having a choice-of-law clause
in the general contract and having a choice-of-law clause in the arbitration
agreement; and, second, it shows that Section 187 of the Restatement (Second)
of Conflict of Laws may not resolve our choice-of-law question.
The separability doctrine helps illustrate the meaningful difference between
the following two scenarios, even though they often lead to similar results when
U.S. courts are deciding what law governs the arbitration agreement: (1) when
the parties indicate no specific chosen law for the arbitration agreement but
include a general choice-of-law clause in the main contract, and (2) when the
parties choose the applicable law that governs the arbitration agreement by
including a choice-of-law clause in the arbitration agreement. Under the
separability doctrine, the general choice-of-law clause does not necessarily apply
to the arbitration agreement in scenario (1), because the general choice-of-law
clause designates the law that applies to the substantive matters in the main
contract, from which the arbitration agreement is separate and distinct. One
might fairly surmise that the parties intended the only chosen law to also
govern the arbitration agreement. However, policies such as uniformity of
applicable law across all stages of the arbitration could be argued to suggest
that the law of the arbitral seat should govern the arbitration agreement, absent
clear party intent to the contrary. In support of this latter point, Article V(1)(a)
of the New York Convention provides that, for the purpose of recognition and
enforcement of arbitral awards, when parties do not explicitly provide a choice-
of-law, validity of the arbitration agreement is governed by the “law of the
country where the award was made.”1
The separability doctrine is further instrumental to our inquiry because it
helps show that Section 187 of the Restatement (Second) of Conflict of Laws
may not solve our choice-of-law question, regardless of whether we are facing
scenarios (1) or (2). Section 187(1) of the Restatement states that “[t]he law of
the state chosen by the parties to govern their contractual rights and duties
will be applied if the particular issue is one which the parties could have
resolved by an explicit provision in their agreement directed to that issue.” In
scenario (1), the law designated by the general choice-of-law clause should not
apply to the arbitration agreement because the parties did not select a law
1 Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York,
1958) (the "New York Convention"), art. V(1).

“PRO-ARBITRATION” FRAMEWORK FOR CHOICE-OF-LAW PRACTICES 593
governing the arbitration agreement. The chosen law governs “the contractual
rights and duties” covered by the main contract, from which the arbitration
agreement is separable. In scenario (2), it can be argued that Section 187 has
limited applicability because one of the parties is resisting arbitration specifically
on the ground that the arbitration agreement is defective and therefore the
arbitration agreement’s choice of law also is defective.
So, what should courts do?
III. CHOICE-OF-LAW PRACTICES OF U.S. COURTS: A “PRO-

ARBITRATION” FRAMEWORK
My survey of choice-of-law practices of U.S. courts in arbitration agreement

enforcement proceedings, particularly when parties have indicated a chosen
law (either in the main agreement or in the arbitration agreement itself), shows
that U.S. courts typically adopt one of the following three choice-of-law
approaches: (1) they directly apply the forum’s substantive law regardless of
the parties’ chosen law; (2) they directly apply the parties’ chosen law; or
(3) they apply the forum’s choice-of-law rules to find the applicable law, which
typically take into account the parties’ choice-of-law clause but do not necessarily
adopt it.
The approach that the courts adopt depends on the nature of the challenges
levied against the arbitration agreement. Courts tend to take the first approach
and apply their forum law to determine the enforceability of the arbitration
agreement, regardless of the parties’ chosen law in the main contract or in the
arbitration agreement, when the challenge against the arbitration agreement
is based on the alleged non-arbitrability of the underlying dispute, public
policy, or res judicata/issue preclusion. The Mitsubishi Motors Corp. v. Soler
Chrysler-Plymouth2 case exemplifies this practice.
Courts often adopt the second approach and apply the parties’ chosen law
(in the arbitration agreement, or, absent the same, in the main contract) to
govern the arbitration agreement when the challenge against the arbitration
agreement is based on the nullity and voidness of the agreement.3 Sometimes,
courts also apply the parties’ chosen law to govern the scope of the agreement.4
Finally, many courts first look to the choice-of-law rules of the forum in order
to decide on the law applicable to the arbitration agreement under challenge.
2 See Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, 473 U.S. 614, 637 n.19 (deciding
that anti-trust claims are arbitrable, but warning in footnote 19 that if the arbitral tribunal were
to apply foreign laws to U.S. statutory anti-trust claims, the court “would have little hesitation in
condemning the agreement as against public policy”).
3 See, e.g., Overstreet v. Contigroup Cos., 462 F.3d 409, 411-12 (5th Cir. 2006) (affirming the
parties’ agreement and applying Georgia law to the question of whether the arbitration clause
was unconscionable when there was no choice-of-law clause in the arbitration clause itself and
the applicability of the Georgia choice-of-law provision to the entire contract has not been called
into question).
4 See, e.g., Roadway Package Sys., Inc. v. Kayser, 1999 WL 817724, at *3 (E.D. Pa. Oct. 13, 1999).
Based on this approach, the parties’ choice of law may play an important role in
the courts’ conflict of laws analysis, but it is not dispositive—courts may not apply
the parties’ choice when the forum’s choice-of-law rules point to a different
body of law.5 Courts usually conduct this choice-of-law analysis when the party
resisting arbitration argues that it did not consent to fundamental aspects of
the prospective arbitration. These issues include the existence and/or scope of
the arbitration agreement and the validity of the choice-of-law clause (in the
arbitration agreement, or, absent the same, in the main contract).6
This framework is “pro-arbitration” because it balances and promotes the
efficacy and legitimacy of international arbitration. Based on this framework,
the Courts typically apply the forum law to issues that embody significant
public importance in the forum. It can be argued that the forum law supersedes
the parties’ chosen law because these issues are of such public importance that
the forum court—charged with the public mandate to apply legislations that
embody important policies—has a justifiable obligation to directly apply forum
law.
Meanwhile, when the challenges to the arbitration agreement are closer to
garden-variety private disputes and no significant forum policy is at stake,
courts typically apply the parties’ choice of law. This approach can be said to
preserve the legitimacy of international arbitration by directly applying the
parties’ bargained-for law.
If the parties’ consent to fundamental aspects of the arbitration is in
question, courts can be viewed to protect the legitimacy of the proceeding by
consulting the forum’s choice-of-law rules to identify the law applicable to the
arbitration agreement. This approach arguably optimizes party autonomy and
forum policy interests, as it considers party intent by applying the choice-of-
law principles of the Parties’ allegedly chosen forum, but does not directly
apply the disputed choice-of-law clause (in the arbitration agreement, or,
absent the same, in the main contract), and by following the forum’s choice-of-
law principles, the courts also take into consideration the forum’s policy interests.
While most of the courts’ choice-of-law analyses can be explained by the
three approaches described above, that is not always the case. One example is
when a party resisting arbitration bases its challenge on allegations that the
party seeking arbitration waived its right to arbitration by litigating the same
matter. Faced with this challenge, courts often apply the law of the forum to
the arbitration agreement without conducting any choice-of-law analysis.7
Contrary to this approach, the Restatement (Third) on the U.S. Law of
5 See, e.g., Cap Gemini Ernst & Young, U.S., L.L.C. v. Nackel, 346 F.3d 360, 365 (2d Cir. 2003)
(“[Although] New York courts generally defer to the choice of law made by the parties to a
contract . . . New York law allows a court to disregard the parties' choice when 'the most
significant contacts' with the matter in dispute are in another state.”).
6 See, e.g., Duplan Corp. v. W. B. Davis Hosiery Mills, Inc., 442 F. Supp. 86, 88 (S.D.N.Y. 1977).
7 See, e.g., Nino v. Jewelry Exchange, Inc., 609 F.3d 191, 208–09 (3d Cir. 2010) (applying
forum law on waiver to determine if a party has waived its right to compel arbitration).
“PRO-ARBITRATION” FRAMEWORK FOR CHOICE-OF-LAW PRACTICES 595
International Commercial Arbitration suggests that courts should look to the

choice-of-law rules of the forum to identify the applicable law regarding the
waiver issue.8 The Restatement reasons that a party’s conduct in litigation or
its alleged waiver of the right to arbitrate typically does not involve sufficient
public policy interest to merit a direct application of forum law, as the right at
issue is a creation of contract and is private in nature. Likewise, the parties’
chosen law may not be the appropriate applicable law, because the argument
against arbitration essentially claims that the legitimate consensual basis for
the arbitral proceeding has been waived. As a result, the Restatement proposes
the application of the forum’s choice-of-law principles, i.e., the third approach
discussed above, which arguably optimizes party autonomy and forum policy
interests.
IV. CONCLUSION
Through the lens of this “pro-arbitration” framework, parties interested in

international arbitration can reasonably interpret judicial choice-of-law practices
as they contemplate a potential arbitration.
8 Restatement (Third) on the U.S. Law of International Commercial Arbitration (Tentative
Draft No. 4), § 2-19 (c).

Chapter 106
TENTATIVE STEPS TOWARD BEING
PRO-ARBITRATION: A TURKISH PERSPECTIVE
Yusuf Kumtepe*
The first rule of pro-arbitration club is: you talk about pro-arbitration
club; the second rule of pro-arbitration club is: you remember that there are
too many rules to fit into a five-page essay. Arbitration may be more popular
in some jurisdictions than others. Still, starting the conversation about the
merits of arbitration is a necessary first step on the road to becoming a full-
fledged member of the pro-arbitration club. Legal practitioners must know
about what arbitration means, and what it achieves, before they can
thoroughly adopt it. With its new laws, arbitration centers and a young,
vibrant, and enthusiastic community of arbitration practitioners, Turkey has
well demonstrated its compliance with the first rule. However, being a
member of this selective club is not easy. To join the club of nations that
enable arbitration to remain accessible, effective and enforceable, Turkey
must resist remnants of its archaic laws and closed-minded interpretation of
the new laws by its courts.
The rules are plenty. Laws must recognize the binding character and
enforceability of awards in arbitrations seated at home or abroad. The
jurisdiction must be home to arbitration centers that provide assistance with
appointing authorities, secretarial services and hearing facilities. Legal
practitioners must be willing to incorporate arbitration clauses into their
contracts; and they must be able to act competently as counsel and arbitrator.
Yet, perhaps the most important rule of all relates to how courts interact with
arbitration. Courts must enforce awards that should be enforced; set aside
awards that should be set aside; preclude a party from starting court proceedings
in breach of an arbitration agreement; and help ongoing arbitration proceedings
without being too intrusive.
This essay will examine whether, and to what extent, arbitration as envisaged
and practiced in Turkey complies with requirements of the pro-arbitration club.
It will then present recommendations for steps that need to be taken.
* Yusuf Kumtepe is an Associate with Kabine Law Office in Istanbul, Turkey. He is admitted
to practice law in New York and Turkey. His work focuses on international commercial and
investment arbitration. Yusuf received the Fulbright grant and the 3C Foundation Scholarship.
He holds a Master’s Degree from Columbia Law School (LLM ‘20) as a James Kent Scholar and a
Bachelor’s Degree from Galatasaray University (LLB ‘17). He worked as a research assistant to
Professor George A. Bermann and as a graduate student researcher at the Columbia Center on
Sustainable Investment.
597
I. LAWS
Turkey—like some countries (France, Switzerland, Singapore) and unlike

others (the United Kingdom, the United States)—adopts a dualist approach in
its treatment of domestic and international arbitrations. The International
Arbitration Act regulates international arbitrations while a section of the Code
of Civil Procedure governs domestic arbitrations.
Both laws, to a large extent, mirror the UNCITRAL Model Law. The
distinguishing factor between domestic and international arbitrations is the
element of foreignness, a broadly defined term under the International Arbitration
Act. There is foreignness not only when parties are from different countries,
but also when one of the parties has a shareholder that has brought in foreign
capital, or when the main contract between the parties involves a transfer of
capital or goods from one country to another.
In both cases, the seat of arbitration must be in Turkey for the laws to
apply. Foreign awards arising from arbitrations seated abroad are enforceable
only if the party requesting enforcement applies to and receives an exequatur
from Turkish courts. The courts issue exequaturs under the New York Convention
(Turkey has been a party since 1992) if the arbitration is seated in a country
that is a party to the convention. If the seat is not in a country that adhered to
the New York Convention, exequaturs are subject to the Private International
Law Act. This, however, does not have much practical importance as the
criteria for refusal of enforcement under the Private International Law Act are
substantially similar to the conditions under Article V of the New York Convention.
To be pro-arbitration, merely designating ways to enforce arbitration
awards is not enough. The more hoops a winning party must jump through to
enforce an award, the less pro-arbitration a jurisdiction is. In this context,
Turkish laws provide for a varied number of enforcement obstacles depending
on the type of an arbitration award.
A domestic arbitration award is the easiest to enforce. The Civil Procedure
Code allows domestic awards to be enforced just like a domestic court judgment.
A set aside application to a court does not suspend enforcement. An appeal to
the court’s decision rejecting the set aside application does not stop enforcement
either.
The situation is more complicated with international arbitration awards that
are seated in Turkey. If the losing party does not make a set aside application,
the winning party must still apply to a Turkish court to get an enforceability
certificate. This certificate requires less burdensome conditions than a set
aside application or grounds for refusal of an exequatur (review is limited to
arbitrability and public policy); but it gives the losing party another chance in
court after missing the deadline for a set aside application. If, in fact, the losing
party does make a set aside application, then enforcement is automatically
stayed until the highest Turkish court renders a final judgment.
TENTATIVE STEPS TOWARD BEING PRO-ARBITRATION 599
Arbitral awards, whether domestic or international, cannot be appealed, but

they can be subject to a set aside application. Grounds for a set aside under both
the Code of Civil Procedure and the International Arbitration Act are identical to
each other, and similar to the UNCITRAL Model Law. In a welcome development
on the path to being pro-arbitration, since 2018 set aside applications are
directly made to a court of appeals, rather than to a court of first instance. This
has decreased the number of courts that examine a set aside application from
three to two. The decision of a court of appeals is appealable only before the
court of cassation.
The procedure for an exequatur of a foreign arbitral award is even
lengthier than the set aside of an award seated in Turkey. For an exequatur, a
winning party must apply to a court of first instance. The court’s decision issuing
an exequatur is automatically stayed in case of an appeal. In other words, the
winning party must wait until the completion of a three-tier court review process
(court of first instance—court of appeals—court of cassation) before it can
enforce the foreign arbitral award.
II. ARBITRATION CENTERS
Institutions are crucial in bringing a pro-arbitration jurisdiction to life.

Arbitration centers do not only provide a set of procedural rules, appoint
arbitrators, decide on challenges, or administer proceedings, but they also
perform the vital function of fostering a sense of community. After all, parties
in any country may refer to the rules of popular arbitration centers such as ICC,
LCIA or SIAC in their contract. However, it is simpler for a local institution to
act as a glue that holds a community of arbitration practitioners together.
Turkey has no shortage of arbitration centers. ITOTAM (Istanbul Chamber
of Commerce Arbitration and Mediation Center) has been administering
arbitrations since 1979 under the rules of its predecessor, and since 2015
under its current form. Inspired by its contemporaries in other countries, ITOTAM
has adopted some novelties such as Emergency Arbitrator Rules, Arbitration
Rules for Basic Claims, and Mediation-Arbitration Rules. Two other arbitration
centers are based in the capital, Ankara: Arbitration Center of the Union of
Turkish Bar Associations is historically focused on lawyer-client disputes, while
the Arbitration Center of the Union of Chambers and Commodity Exchanges of
Turkey appears to target local disputes among its members.
Perhaps the most vocal of Turkish arbitration institutions is ISTAC (Istanbul
Arbitration Centre). Founded in 2015, ISTAC aspires to serve both local and
foreign parties. It has a national as well as an international board with the
latter composed of familiar names of the international community such as Jan
Paulsson, Hamid Gharavi and Bernard Hanotiau. In addition to its flagship
arbitration rules, ISTAC has Fast Track Arbitration Rules, Emergency Arbitrator
Rules, Mediation Rules and a hybrid Mediation-Arbitration Rules. The center
provides hearing room facilities and hosts almost weekly conferences in both
English and Turkish. Yet, the most striking of ISTAC’s promotional capabilities
is its forum for young professionals. Young ISTAC organizes training events and
conferences aimed at practitioners who are 40 years and younger; publishes a
newsletter about the latest news and court decisions that are of interest to the
Turkish arbitration community; and runs an annual moot court competition
that welcomes more than 60 teams each year from every corner of the country.
III. COURTS
Courts of a pro-arbitration jurisdiction limit their review of arbitral awards

to a narrow set of grounds without going into merits of a case; do not allow
parties to start court proceedings when there is an arbitration agreement; and
enforce foreign arbitral awards that are in compliance with the New York
Convention. Turkish courts do a decent job of siding with arbitration in
straightforward cases. However, a true member of pro-arbitration club
demonstrates itself in gray areas. In such cases, Turkish courts’ interpretation
of new and old laws does not always fit the description.
The impact of an archaic law from 1926 is a good example. Enacted a few
years after the birth of the modern republic, the law says that contracts must
be drafted in the Turkish language, presumably to protect Turkish merchants
of the time from entering into contracts that they do not completely understand.
For years, the law did not attract much attention. However, in 2010s, relying
on the law of 1926, a chamber of the court of cassation started to invalidate
arbitration agreements drafted in a foreign language. The good news is that
more recent decisions of the court of cassation interprets the law in a way that
limits its application to contracts between two locals, and enforces foreign
language agreements made with a foreign person.
A recent decision of the court of cassation provides an even more compelling
example of the judiciary’s anti-arbitration attitude. Relying on the principle of
procedural economy and courts’ exclusive power to declare a company bankrupt,
the court found that a creditor does not need to first file an arbitration before
initiating a bankruptcy lawsuit despite the existence of an arbitration agreement.
As there is no binding precedent in Turkey, the dissenters’ opinion was appeasing
to the arbitration community: the creditor could simply get an arbitration award
proving the existence of its receivable and then apply to courts for a bankruptcy
decision.
In the case of enforcement of foreign arbitral awards, some courts’
interpretation of the New York Convention tilts away from a pro-arbitration
stance. Recently, the court of cassation did not enforce an award of damages
for legal fees incurred in a court proceeding initiated in breach of an arbitration
agreement when the arbitration agreement did not explicitly provide for such
remedy. In a similar vein, the court of cassation rejected to issue exequatur to
an award where the arbitral tribunal, after an assertion of trade secrets, allowed
a party’s counsel and experts, but not the party itself, to review a redacted
TENTATIVE STEPS TOWARD BEING PRO-ARBITRATION 601
valuation report prepared by another party. The court reasoned that the arbitral
tribunal’s decision breached the first party’s right to be heard as the tribunal’s
award of damages was based on that redacted valuation report.
Courts’ differing views on the method of calculation of court fees in
exequatur applications created even more headache in practice. For a while,
the opinion of separate chambers of the court of cassation was split on whether
a party who applied to get an exequatur for a foreign arbitral award should pay
court fees at an amount proportional to the award (which might reach punitively
high levels) or at a nominal fixed fee. Thankfully, a legislative amendment and
a subsequent decision of the general assembly of the court of cassation resolved
the issue in favor of the nominal fee.
IV. NEXT STEPS
There is no doubt about Turkish lawmakers’ intent to promote arbitration

as an effective form of alternative dispute resolution. The country has laws that
recognize the binding character of domestic and international awards seated
in Turkey and enforces foreign arbitral awards under the New York Convention.
In recent years, Turkey has also adopted legislative amendments that reduced
the number of court levels that review set aside applications and precluded
charging of excessive court fees in exequatur applications. Nevertheless, there
is still a long way to go before achieving genuine pro-arbitration status.
Lawmakers can start by making international arbitration awards with a
Turkish seat as easily enforceable as a domestic award. The burden of applying
to a court for an enforceability certificate should be lifted. Automatic stay on
enforcement when there is a set aside application (and during a subsequent
appeal) is also inappropriate and should be abandoned. One might wonder
why the regime governing the enforceability of international arbitration awards
is more strenuous compared to domestic awards. The answer may lie in their
age. Both are new, from this century; but the International Arbitration Act was
enacted in 2001 while the Code of Civil Procedure was completely renewed in
2011. The drafters of the newer code may have become more pro-arbitration
after the passing of a decade. In the 2020s, however, there is no reason to keep
international arbitration at a disadvantageous position relative to its domestic
sibling. In the meantime, courts should not frown upon parties who specifically
refer to the Civil Procedure Code in their arbitration agreements to receive the
more favorable treatment granted to domestic arbitrations even while the
agreement carries an element of foreignness.
Next is streamlining the process of getting an exequatur for foreign arbitral
awards. Currently, a winning party must go through three levels of court review
before it can enforce a foreign award. Like the procedure governing set aside
applications for Turkish seated awards, a court of appeals—and not a court of
first instance—should examine exequatur applications directly. It is also too
onerous to make an applicant wait until the end of the review by the highest
court to enforce an award. Instead, the court of appeals’ decision issuing an

exequatur should be immediately enforceable even while the appeal before the
court of cassation is ongoing.
With many actors at play, it is more difficult to reform the attitude of
courts. A good start is harmonizing court decisions dealing with arbitration.
Currently, different chambers of both a court of appeals and the court of cassation
may decide on arbitration-related issues. The division of work among chambers
is based on the industry of the subject matter of the dispute such as construction,
sales, insurance, etc. Instead, all arbitration-related court proceedings (set aside
and exequatur applications) must be reviewed by a single predetermined
chamber.
Turkish legal practitioners have been talking a lot about arbitration for the last
two decades. This is a good sign for a community that wants to be a member of
a club that not only encourages talking about arbitration but also requires it.
Conversing on the subject of arbitration is only a first step for the local
arbitration community that is growing thanks to the efforts of a new generation of
passionate forward-looking lawyers. Lawmakers, courts, arbitration centers
and legal practitioners must each do their part and collaborate to make Turkey
a truly pro-arbitration jurisdiction.
Chapter 107
MAKING INTERNATIONAL ARBITRATION
“PRO-ARBITRATION”: ELIMINATING
HINDRANCES AND ENHANCING ACCESSIBILITY
Zeina Obeid*
Over the past decades, international arbitration has firmly established itself
as one of the usual means for resolving international commercial disputes. This
evolution has been facilitated by the implementation of a multitude of “pro-
arbitration” processes and practices at the national and international levels.
While the significant growth of international arbitration has been enhanced by
its practical and socio-economic importance, concerns have been raised about
the excessive length and cost of arbitration proceedings. Finding ways of
effectively controlling such issues is important to users, institutions, practitioners
and other stakeholders.
Recently, the emergence of the COVID-19 pandemic triggered systemic
changes in international arbitration. The arbitral practice has been redefined,
with entire proceedings taking place remotely, and users adapting to the new
reality quicker and more efficiently than expected. These adaptive reactions
have transformed international arbitration by making it less burdensome in
terms of costs and duration. This essay will explore those processes and practices
that enhance access to international arbitration for all users, including parties,
counsel, as well as potential arbitrators and experts.
A factor that commonly impedes parties’ access to international arbitration
is its “cost”. While arbitration costs can vary depending on the relevant
jurisdiction, duration and method of arbitration, many parties have financial
constraints, and need access to a process that can facilitate time and cost-
efficient resolution of their dispute. Various innovative procedures have been
developed to address such concerns.
* Zeina Obeid is a Partner at Obeid & Partners, where she practices in the Litigation &
Arbitration department. She has acted as counsel, arbitrator and administrative secretary in
major international arbitration cases across the Middle East and North Africa region. Zeina holds
a PhD from the University Panthéon-Assas (Paris II) in France and an LLM from Columbia
University in New York. She is a Fellow of the CIArb, member of the ICC Commission on
arbitration & ADR and Co-Vice-Chair of the IBA Young lawyers Committee. She is admitted to
practice in Paris and Beirut.
603
I. TECHNOLOGY
Technology has played a key role in enhancing the efficacy of international

arbitration during the COVID-19 pandemic. The various arbitration actors
implemented and adopted new tools so that arbitration becomes more accessible,
attractive and less costly. We have witnessed in the past two years a significant
improvement in achieving these goals through the use of technology. It has
now become quasi-common practice to conduct virtual hearings, whether
procedural or evidentiary hearings. It has also become an accepted practice to
examine witnesses and experts remotely via appropriate means of virtual
communication. The efficiency of the conduct of virtual arbitrations has been
further enhanced through the development of new software and techniques such
as electronic document production, electronic case management systems, etc.,
which constitute key tools for improving the efficiency of the conduct of remote
hearings.
Enhancing arbitration efficiency through technology is not cost-free for the
parties. It can sometimes become quite expensive and would defeat the purpose
of conducting a cost-effective arbitration. It is, therefore, the role of the parties
and their counsel to assess, on a case-by-case basis, bearing in mind the size of
the case, the amount in dispute, the location of the different stakeholders,
whether it would be more cost-effective to follow the route of an in-person or
a virtual hearing.
II. ROLE OF ARBITRAL INSTITUTIONS AND ADOPTION OF NEW

MECHANISMS
Arbitral institutions have also swiftly adapted to the new “virtual reality”
by incorporating rules enhancing virtual communications, promoting the conduct
of remote hearings, and permitting the electronic signing of the final award.
Such steps comfort the parties on the validity of conducting a virtual hearing
and that the enforceability of awards is safeguarded.
Arbitral institutions are key actors that work towards ensuring the efficiency
and adaptation to the new norm post-pandemic of the “arbitration enterprise,”
as described by Prof. Bermann.
In recent years, we have witnessed a new trend whereby arbitral institutions
have been implementing rules on fast-track proceedings to meet the growing
need of users to expedite the arbitration proceedings.
Expedited procedures involve shortened time limits in relation to the
appointment of the tribunal, the procedural steps in the timetable, the
deadlines for the submissions and the deadline for the issuance of the final
award. Some institutions, such as the International Chamber of Commerce
(ICC), impose strict time-limit on tribunals to render the final award, which
will see their fees reduced if the award is not rendered within the specified
time limit. Various arbitral institutions have also introduced procedures that
MAKING INTERNATIONAL ARBITRATION “PRO-ARBITRATION” 605
enable the expedited formation of the arbitral tribunal in cases of exceptional

urgency, while they also provide for the appointment of an emergency arbitrator
where urgent relief is sought pending the formation of the tribunal.
The recent development in arbitration shows that some arbitral institutions
are favorable to include in their rules a procedure regarding summary disposals
of claims. Although the benefit of adding such a mechanism remains controversial,
it nonetheless represents another effective means of reducing time and cost as
it enables the quick resolution of cases.
III. ROBUST TRIBUNALS
Arbitral Tribunals also have an important role to play in the control of the
proceedings by ensuring that procedural flexibility inherent to arbitration is
not subject to abuse by the parties wishing to obstruct the proceedings.
Serge Lazareff had described arbitration as a dispute method in which
“gentlemen were settling a dispute between gentlemen in a gentlemanly way.”
(“L’arbitre singe ou comment assassiner l’arbitrage”, in Liber Amicorum in
honour of Robert Briner, 2005, p. 477) Is it still the case? Parties seeking to
adopt delaying and/or dilatory tactics is becoming more common in arbitration
practice. It has thus become key for parties to rely on robust arbitrators who
know how to strike a balance between procedural fairness and due process on
the one hand, and conducting efficient proceedings on the other, with the
ultimate goal to render an enforceable award.
IV. “DEMOCRATIZATION” OF INTERNATIONAL ARBITRATION
The “arbitration enterprise” is no longer a closed circle. Technology and other

initiatives have led to a wider “democratization” of international arbitration. It
is becoming more accessible to parties, potential arbitrators and experts. The
online availability of knowledge exchange, coupled with the fact that parties
and arbitrators are not necessarily required to travel in order to attend in-
person hearings, has eliminated geographical limitations and created
opportunities for under-represented groups. This geographical flexibility,
together with the increased connectivity achieved through technological progress
enables parties to consider new aspiring arbitrators who have the requisite
skills for running an arbitration procedure. Arbitral institutions and private
initiatives such as the Pledge, REAL etc., have also substantially contributed to
improving diversity in arbitration, notably during the phase of the appointment
of the arbitral tribunal.
V. INCREASED ACCESSIBILITY AND TRANSPARENCY
Access to data in arbitration is becoming more accessible. Significant efforts

were exerted by different stakeholders and, in particular, arbitral institutions,
which possess a significant amount of data that could be shared while preserving
confidential information. Such data includes, inter alia, the date of filing, the
names of arbitrators and counsel, the date of hearings, the date of the final award,
as well as the final award itself in a redacted version. This information can provide
potential users with the data they need to comprehend the manner in which
the arbitral process is advanced, discover current trends in case law, as well as
assess the availability, working method, and approach followed by potential
arbitrators. In general, the publication of arbitral awards enhances legal certainty
and addresses any legitimacy concerns raised in relation to arbitration.
VI. REGIONAL ADAPTABILITY: THE MIDDLE EASTERN EXAMPLE
In recent years, we have seen significant development in arbitration in the

MENA (Middle East and North Africa). It is very common to choose an Arab
country as the seat of arbitration or to choose the law of an Arab state as the
substantive law. It is clear that the Middle East is on its way to becoming an
international arbitration hub.
Most countries have reformed their arbitration legislations and have
embraced, to a varying degree, the UNICTRAL Model law. It is the case in Oman
and Bahrain which adopted the Model Law almost word for word. Recently as
well, in Qatar in 2017 and the UAE in 2018 also adopted new arbitration law
inspired by the model law in an effort to become a more “arbitration friendly”
jurisdiction in the region. In Lebanon, it is different, it is not the model law that
has been adopted, the arbitration law is based on the old French arbitration law.
The particularity of the landscape in the region is that some countries have
a dual legal system known as the off-shore and the on-shore. This is the case in
Qatar and in the UAE.
The on-shore legal framework is typically the civil law system of the country
and its local courts. The off-shore framework consists of free zones which have
their own courts, arbitral institutions and the legislation prevailing in these
zones is generally based on common law.
In Dubai, it is the Dubai International Financial Centre (DIFC) that has been
described by Michael Hwang, the former chief justice of the DIFC, as a “common
law island in a civil law ocean.” The DIFC used to have its own arbitration center,
the DIFC-LCIA. This arbitral institution, and other institutions such as the Emirates
Maritime Arbitration Center, were abolished last September by Decree No. 34
of 2021 issued by the Dubai government, which came into force on 20 September
2021. The assets of these arbitral institutions were transferred to the onshore
arbitral institution Dubai International Arbitration Centre (DIAC). By taking
this approach, Decree No. 34 of 2021 instated DIAC as the only arbitration
center in Dubai with the aim of promoting DIAC as a leading arbitral institution
in the region with its new status as a non-governmental and non-profit center
having legal personality, financial and administrative autonomy.
In Qatar, the free zone is the Qatar International Court (QFC) and its
arbitration center is the Qatar International Court and Dispute Resolution
MAKING INTERNATIONAL ARBITRATION “PRO-ARBITRATION” 607
Centre (QICDRC). The onshore version of the arbitration center is the Qatar
International Center for Conciliation and Arbitration (QICCA) (whose latest
rules published in 2012 are based on the UNCITRAL Arbitration Rules).
Regarding the legislation, the arbitration laws, except for Lebanon, do not
make a distinction between domestic and international arbitration and all
Arab countries are signatories to the Washington convention and all of them
(except for Iraq) are signatories to the New York Convention.
Despite these positive efforts, there were some ups and downs in the
enforcement of arbitral awards in Arab countries over the past years, especially
in the Gulf.
In Qatar, before the reform of the arbitration law, awards were refused
enforcement on the ground that they were not issued in the name of the Emir
of Qatar or if the witness or expert did not take an oath. Fortunately, this is no
longer the case with the new law.
In the UAE, before the enactment of the new law, when the seat was in the
UAE, arbitrators were required to travel to the UAE to sign the award and had
to sign each page of the award. Fortunately, these are no longer grounds for
refusing the enforcement of an award. There are still, however, some uncertainties
regarding the requirement to take an oath for witnesses. Tribunals are usually
precautious and require this formality to protect the award.
In Jordan, parties’ representation is an important issue to be aware of.
Jordanian courts have annulled awards on the ground that parties were not
represented by Jordanian lawyers as per the bar regulations.
In sum, today, the arbitration landscape looks more pro-arbitration. However,
if an Arab country is chosen as the seat of the arbitration, it is important to be
prudent and check the local requirements in order not to jeopardize the
enforceability of the award.
VII. AVOIDANCE OF DISPUTES
The several crises that hit the world in the past years (sanitary, financial
and economic crisis) has led to a movement favoring the development of
techniques for dispute avoidance and an increasing interest in alternative
mode of dispute resolution such as mediation, adjudication and negotiation.
Favoring dispute avoidance is not antagonist to arbitration. Both techniques
are complementary. Arbitration will remain highly functional and attractive
when unnecessary, premature or frivolous disputes are being referred to other
forums than arbitration. This would only increase trust in arbitration as an
efficient and viable mode of dispute resolution. Rendering justice on time in a
cost-effective manner while avoiding unnecessary delays are key elements for
arbitration practitioners to take into account when choosing a route to resolve
a dispute. This does not mean that all disputes should inherently be avoided or
that disputes are inherently negative, but on the contrary, it is precisely those
“solid” disputes which should make their way to international arbitration.
In general, dispute avoidance is important for two main reasons. First, it

allows to resolve issues as they arrive before they escalate into a dispute,
therefore saving a considerable amount of time and money, second, avoiding
disputes is crucial to the maintenance of good working relationships between
the different parties involved such working relationships being most often
destroyed by the confrontational nature of litigation or arbitration.
The mechanisms and techniques for avoiding disputes are not few.
Naturally, the avoidance of disputes starts with the good drafting of a contract.
This includes drafting well-thought-out provisions on what to do when
disagreements arise. The construction sector provides a good example of
healthy mechanisms of dispute avoidance which go alongside arbitration. With
construction cases constituting the largest category of cases in ICC caseload
historically, this sector merits attention. Particularly, dispute boards, which
were conceived and developed in FIDIC contracts, are a means of avoiding the
issues encountered throughout the life of a construction project that develop
into disputes and, if they do, to decide the issue in an informed manner.
Nowadays, several institutions have elaborated their own rules concerning
dispute boards (dispute adjudication boards and dispute review boards),
including notably the ICC and the Chartered Institute of Arbitrators. Another
example of a mechanism of dispute avoidance is the notion of a contract
administrator, usually an engineer, architect or other suitably qualified
professional, who is trained to be capable of advising the parties on their
contractual rights and obligations and empowered to implement administrative
procedures set out in the contract.
The essential point is that avoiding escalating unnecessary disputes to
arbitration avoids wasting resources, helps with maintaining parties’ expectations
and increases trust in international arbitration.
VIII. CONCLUSION
In sum, the international arbitration community is making rapid progress

in ensuring that international arbitration remains the preferred method of
dispute resolution of international commercial disputes. The last couple of
years, driven by the pandemic, have spearheaded a substantial elimination of
hindrances and enhanced access to justice. The flexibility inherent to arbitration
allowed a quick adaptation to changing circumstances and reasserted to the
different actors in the international community that arbitration remains the
preferred method of dispute resolution in both crises and normal times.

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“PRO-ARBITRATION” REVISITED

A Tribute to Professor George Bermann

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Part I - Faculty in International Arbitration

Part II – Former Students in International Arbitration

Columbia Law School International Law Faculty 1980

at Milbank LLP, in the São Paulo office.

Católica del Perú, in Lima, Perú.

at Cleary Gottlieb LLP, in the New York office.

Columbia’s The American Review of International Arbitration. Professor Bermann introduced

Professor George Bermann and Professor Sandra Bermann, Princeton, New

survey of the major topics in international arbitration; I cannot think of a more

Professor Bermann's Children (from left to right):

Columbia University School of Law

Date of birth: December 2, 1945

Columbia University School of Law:

Professeur affilié, Ecole de droit, Institut des sciences politiques (Sciences

PROFESSIONAL MEMBERSHIPS AND ACTIVITIES:

Chief Reporter, ALI Restatement of the US Law of International

Member of Board of Advisors, Koç Univ. Law School, Istanbul, Turkey

Honorary Degrees and Awards

FIELDS OF RESEARCH, WRITING AND PUBLIC SPEAKING

Articles and Book Chapters

The Contribution of International Commercial to International Investment

International Commercial Arbitration: Present Challenges and Future

Arbitrale Internationale (festschrift for Hans Smit) (T. Carbonneau & V.

Conference and Workshop Papers

Is there a Right to an In-Person Hearing? (Columbia Arbitration Day,

Reflections on the Restatement (conference at Pepperdine Univ. School of

The Achmea Decision and the ECJ’s Challenge to International Investment

Is Arbitration Insufficiently Predictable? (6th annual GAR Live New York,

The European Union and ICSID Arbitration (Society of International Law,

International Commercial Arbitration and its Relationship to Third-Party

in the International Arbitration System of the 21st Century: Trendsetter,

Jurisdictional and Admissibility Issues in International Arbitration (Max-

Effective International Arbitration: A Transatlantic View (ICC UK Annual

Keynote Addresses and Endowed Lectures

Recalibrating the EU-International Arbitration Interface (annual EFILA

Gateway Issues in International Commercial Arbitration (keynote address,

Other Presentations and Publications

Moderator, Arbitration Debates (event in memory of Hans Smit, Columbia

Articles and Book Chapters

Conference and Workshop Papers

Techniques of Parallel Litigation in International Litigation (Univ. of

Keynote Addresses and Endowed Lectures

Other Presentations and Publications

C. EUROPEAN UNION LAW

Articles and Book Chapters

New Frontiers in the Relationship between National and European Courts,

Regulatory Cooperation between the European Commission and US

Conference and Workshop Papers

European Law: Yesterday, Today and Tomorrow (Univ. of Texas, Austin,

Keynote Addresses and Endowed Lectures

Other Presentations and Publications