I am sure
everyone has heard about Bilateral Investment Treaties and arbitration clauses
in those international laws. However, have you ever heard about a Bilateral
Arbitration Treaty – BAT? This is a new proposal from Professor Gary Born about
a default rule to provide arbitration as the mechanism of dispute resolution
between nationals from signatory countries.
This is not
an arbitration offer from a host country to the investor, as it happens in
BITs, but it is the dispute method applied to private parties, in international
commercial contracts. A Bilateral Treaty would provide tailored rules to the
specific situations that should go preferably to arbitration instead going to
local courts. In that sense, the countries would prescribe in the legal
document all the questions they consider “non-arbitrable” and the ones that are
“arbitrable”.
Professor
Gary Born addresses in the video bellow all the objections to that proposal.
Just to mention one of them, he contradicts the objection that a BAT would
violate the right to seek justice in public courts. However, he says, we should
understand what exactly the right of action in state courts means in practice
in an international commercial litigation. This means that each party will seek
judicial protection in their own country, each one will spend tons of money in
litigation in both countries and, at the end of it, they may end up with two
contradictory solution that would be hardly enforceable in any country. “That
is the denial of justice”! Why, instead, we could not offer a solution that is
trustworthy in the eyes of each party, for its neutrality and that is
enforceable in 149 Countries?
To learn
about other aspects, who better than the Master himself to explain them. Take a
look at his class at University of Pennsylvania Law School.
Additional Material: http://kluwerarbitrationblog.com/blog/2015/03/13/model-bilateral-arbitration-treaty-released-for-public-comment/comment-page-1/
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