STATE-TO-STATE ARBITRATION PURSUANT TO BILATERAL INVESTMENT TREATIES: THE ECUADOR-US DISPUTE

by Marcin Orecki*

This paper presents the state-to-state arbitration between the United States (US) and Ecuador that was a consequence of an investor-state arbitration in the Chevron case (both arbitrations pursuant to the US-Ecuador Bilateral Investment Treaty (BIT)). The questions inter alia were whether a dispute between the US and Ecuador existed at all and whether silence on behalf of the US alone could create a positive opposition in order to determine the existence of a dispute. However, one of the most important issues in the case was an alleged attempt by Ecuador to re-litigate the arbitral award of the Chevron case, and, if that were possible, to create an appellate jurisdiction of the state-to-state arbitral tribunal. This kind of jurisdiction would be contrary to the BIT`s object and purpose and would risk destabilizing the
international adjudicatory system. The arbitral tribunal resolved the dispute on 29 September 2012. However, as the award is not available to the public, the outcome is unknown. After evaluating the arguments, it must be noted that each argument raises doubts and the solution to this case is not straightforward. However, the arguments presented by the US, especially the policy arguments connected with investment law and arbitration principles such as depoliticization, seem to be more convincing.

Download PDF: State_to_State_Marcin_Orecki_10_02_201 (750 kb)

 

* LL.M. candidate (Geneva LL.M. in Int’l Dispute Settlement [MIDS], 2013); MA in Law (2012, University of Warsaw). I would like to thank Mr. Michele Potestà and Ms. Elizabeth Boomer for comments on an earlier draft of this paper.

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