GAL and the nature of Bilateral Investment Treaty (BIT) tribunals

One of the recurring pleasures of being based at NYU is the opportunity to attend and participate in the huge number of interesting seminars, colloquia and workshops hosted by the law faculty. here Yesterday, in the context of the colloquium on Interpretation and Judgment in International Law run by Benedict Kingsbury and Joseph Weiler, Professor José Alvarez, President of the American Society of International Law and Professor at Columbia University, gave a first airing to some of his recent work on BIT tribunals (co-authored with Kathryn Khamsi, and soon to be published as an IILJ Working Paper - I'll flag it here when it comes out), and in particular with a number of recent decisions that have stemmed from claims made by US companies against the Argentinian Government in the wake of the Argentine economic crisis of 2001. Here is the abstract:

This article re-examines interpretative questions raised in the course of five controversial arbitral decisions issued against Argentina arising from claims brought by US foreign investors who had been operating public utilities in that country. All these claims arose in the wake of Argentina’s crisis in 2001, stem from measures taken by that state under an Emergency Law issued in 2002, and arose from the application of the US-Argentina Bilateral Investment Treaty. In all the cases, Argentina attempted to assert a defense of “necessity,” based on its own national law as well as a clause in the treaty that provides that state parties are not precluded from taking “measures necessary for the maintenance of public order” or to protect its “essential security interests.” Three of the decisions yielded multimillion dollar judgments against Argentina, another partly accepted Argentina’s defense of necessity, and the fifth decision, by an ICSID Annulment Committee, severely criticized but did not annul one of the previous arbitral verdicts. The article focuses on the interpretative questions raised by the defense of necessity and uses them to shed light on the nature or “soul” of this regime.

The paper contains some extremely detailed and insightful critique of the decisions in each of the five cases examined; as such, it is well worth reading for anyone with an interest in the particular field. As ever here, however, my more immediate concern is with framing the paper, and the issues to which it gives rise, in terms of a global administrative law perspective more generally. The point that I want to highlight in particular is not dealt with explicitly in the paper, but rather emerged from the interesting - and at times spirited - debate that followed its presentation in yesterday's seminar.

BIT tribunals occupy something of an unusual place in the conceptual topology of global administrative law - a fact attested to by the number of articles focusing on the topic (see, for example, the general article on the subject by Van Harten and Loughlin; Schill's analysis of the "fair and equitable treatment" standard; and Montt's article on BITs in Latin America). First and foremost, they are review bodies, established in order to ensure that the national administrative agencies abide by the administrative law rules imposed upon them under the terms of the BIT in question when dealing with the assets for foreign investors. As such, they fit reasonably nicely into the initial classification - a supranational ex post review body in the general category of distributed administration. Here, the "global" element of the GAL rules refer to their provenance in an international treaty (albeit a bilateral one).

So far, so clear; however, there have been suggestions that the Tribunals themselves can and should be viewed as itself constituting a type of administration - a loose network that, through the increasing production of a relatively homogenous body of jurisprudence on the interpretation of certain key administrative law terms ("fair and equitable treatment", "necessity", etc.) that appear in almost all BITs (and here, the widespread use of model treaties has contributed to the fact that the terms of the some 3000 BITs are themselves strikingly homogenous), is itself effectively functioning as a global "standard setter" in terms of the global administrative law of foreign investments. This becomes even more important when we consider that a number of BITs now refer to these standards as forming part of general customary international law.

The paper by Alvarez and Khamsi does much to cast doubt on this prospect, noting as it does the differences between the arbitral decisions, and the reasoning behind them, in the five cases dealing with similar sets of circumstances arising under the same treaty - to the extent that, in one decision, no reference whatsoever was made to a slightly earlier case in which the notion of "interpretation" was interpreted in an opposing manner, despite the fact that one of the arbitrators had acted on both panels. This would seem to do much to undermine the "relatively coherent jurisprudence" claim that underpins the suggestion that BIT tribunals should themselves be viewed as a loose form of network administration. Interestingly, this position - that arbitrators are chosen on a case-by-case basis, and have no obligation to follow or even to acknowledge any sense of precedent (indeed, to do anything other than represent the interests of those who appointed them) - was maintained strongly in the ensuing debate yesterday by those working mainly in the field of international commercial arbitration.

Alvarez, however, made the important and interesting point that the second tribunal's lack of citation and attempt to distinguish the previous interpretation of the notion of necessity made in the earlier decision under the same treaty had been met with strong criticism by many of those working within the field of BIT arbitration (itself a relatively small community of arbitrators). This raises the thorny issue of whether BIT tribunals should be understood as being like (purely private) commercial arbitrations, or whether they have a particular nature that implies a degree of "publicness", and which would, in turn, render proper the application of some notion of precedent, and perhaps further administrative law/due process/accountability mechanisms. What the paper and subsequent discussion did illustrate, and illustrate well, is the often almost constitutive importance - insisted on for some years now by authors such as David Kennedy and Martti Koskenniemi - of the self-understanding of practitioners in the development of the field in which they operate. Whether BIT arbitrators are predominantly chosen in future from the worlds of international law or commercial arbitration could have a huge impact on the very nature of the tribunals themselves, and by extension any possible characterisation as constituting a system of "networked administrative governance".

The conclusion of the discussion? Perhaps predictably, the jury - for want of a better term - is still out...

Max Planck Institute project on international bureaucracies

Scholars at the Max Planck Institute for Comparative Public Law and International Law, in Heidelberg, Germany, are coming to the end of an extensive and ambitious two-year research project into the law of international bureaucracies. The project's website - for all those who speak better German than I do - is available here; although it is worth noting that the results of the project, to be presented at a seminar at the Institute in April of this year, will be in English.

The main bulk of the project consists in around twenty detailed case-studies of international administrations and the law regulating them. These include international organisations that produce binding norms or decisions (such as ILO, UNHCR, Security Council); those that produce non-binding norms (certain aspects of the World Bank, OECD, OSCE and FAO); treaty regimes (CITES, Kyoto); networked regimes (dealing with issues of security, migration and energy); and hybrid organisations (ICANN). A full(er) list of the case studies can be found on this workshop programme (in English) from earlier in the project.

Plans are, it seems, to first publish some of the case studies in the German Law Journal (an excellent, free, monthly online academic publication), and then to follow thus up with a more comprehensive book on the subject later in the year. Of course, we'll keep you informed as these come out.

GAL and Torture: The Saadi Case before the ECtHR

Is there any relation between the absolute prohibition on torture contained in international human rights law and an emerging Global Administrative Law? I think that a case can be made that there is, particularly in relation not to the ban on torture itself, but to the related prohibition on refoulement - defined in Article 3 of the Convention Against Torture in the following terms: "No State Party shall expel, return ("refouler") or extradite a person to another State where there are substantial grounds for believing that he would be in danger of being subjected to torture".

Although there is a real risk of seeking to include too much within the scope of GAL, and in doing so depriving the concept itself of any analytic utility, my view is that the rules on non-refoulement can and should be viewed not only as forming a part of global administrative law, but in fact representing one of the most powerful and truly global rules in existence within that emerging field. The argument runs something like this: in the administrative relation, we have an agency exercising public power, and a constituency whose interests are affected (at least potentially) by that exercise. Administrative law - in one common conception at least - concerns directly the second-order decisional rules that constrain the agency in question, compelling it to have regard to the interests affected by its decisions; in other words, it regulates the administrative relation. Thus, for example, the provision in the Convention on the Rights of the Child which mandates that in all administrative decisions involving children their best interests must be a "primary consideration" (Art. 3(1)), has been viewed in the past as a rule of global administrative law.

Often, deportation decisions are taken by national administrative agencies, who in doing so must respect the rights of the affected individual, and in particular the absolute right not to be tortured. The interest in question, then, is the individual's interest in not being tortured; the rule of non-refoulement can be viewed as a second order rule ensuring that the particular interest in this case is not disregarded by the administrative agency in question (for a detailed study of the notion of "disregard" in a GAL context, see this draft paper by Richard Stewart). The absolute nature of the second-order rule here is a straightforward reflection of the absolute nature of the prohibition of torture.

That both this prohibition and the GAL rule supporting it are absolute was affirmed in powerful terms by the European Court of Human Rights last week, in its judgment in the case of Saadi v. Italy. The case involved a Tunisian national, accused of terrorism-related activities, faced with deportation to Tunisia, who argued that to do so would violate the torture provisions of the ECHR as there was a substantial risk of his being tortured upon his return. The submissions of the Italian Government in the case focused largely on whether or not there was a "substantial risk" of torture in Tunisia, stressing the international treaties that that counrty had entered into, and noting that it had sought and gained "diplomatic assurances" that the rights of the accused would be respected upon his return. It also sought to cast doubt on the evidence drawn from a number of reports by NGOs, such as Amnesty International and Human Rights Watch (paras. 102-116).

Also interesting here was the fact that the UK intervened as a third party in the case, and made a series of far more controversial claims: that the prohibition on torture must be balanced against the right to life of innocent civilians in an age of international terrorism (para. 119); that the prohibition on torture was absolute only for the acting state - it's positive obligation of protection protection against torture in other states must be weighed against "the interests of the community as a whole" (i.e. that an absolute ban on torture should not translate into an absolute ban on refoulement, para. 120); that the threat posed by the accused should be a factor in evaluating the potential for and nature of ill-treatment upon return; and, relatedly that where national security was implicated, the standard of proof required of the accused of possible ill-treatment should be raised from a "substantial risk" to a "more-likely-than-not" test (para. 122). Basically, the UK asked the Court to overturn its earlier judgment in the Chahal case, which, it argued, had - due to its rigidity - "caused many difficulties for the Contracting States by preventing them in practice from enforcing expulsion measures". Which, of course, was entirely the point.

The Court, as noted above, reaffirmed the absolute nature of the first order prohibition on torture and the second order (GAL) prohibition on refoulement in the strongest possible terms. Of most interest to us here is its conclusion at para. 138:

The Court cannot accept the argument of the United Kingdom Government, supported by the respondent Government, that a distinction must be drawn under Article 3 between treatment inflicted directly by a signatory State and treatment that might be inflicted by the authorities of another State, and that protection against this latter form of ill-treatment should be weighed against the interests of the community as a whole... Since protection against the treatment prohibited by Article 3 is absolute, that provision imposes an obligation not to extradite or expel any person who, in the receiving country, would run the real risk of being subjected to such treatment. As the Court has repeatedly held, there can be no derogation from that rule... It must therefore reaffirm the principle stated in the Chahal judgment... that it is not possible to weigh the risk of ill-treatment against the reasons put forward for the expulsion in order to determine whether the responsibility of a State is engaged under Article 3, even where such treatment is inflicted by another State.

The Court also rejected the submissions of the Italian Government, noting its past reliance on the work of important NGOs, and challenging the idea that it had received "diplomatic assurances" - although it should be noted that it did not reject the notion of such assurances out of hand, noting only that they would have to examine each case in context to determine "whether such assurances provided, in their practical application, a sufficient guarantee that the applicant would be protected against the risk of treatment prohibited by the Convention" (para. 148). The judgment is illuminating, however, in that is details exactly what the Italian Government requested and received in claiming that it had such assurances:

[T]he Italian embassy, counting on the sensitivity of the Tunisian authorities on the question, has the honour to formulate, subject to the judicial prerogatives of the Tunisian State, the following urgent request for guarantees, as an indispensable formal prerequisite for the solution of the case now pending:
...
please give assurances that the fears expressed by Mr Saadi of being subjected to torture and inhuman and degrading treatment on his return to Tunisia are unfounded;
...
In addition, the Italian embassy would be grateful if the Tunisian authorities would keep it informed of the conditions of Mr Saadi's detention if he were to be committed to prison.

(Indeed, with a robust oversight mechanism of this sort in place, what could possibly go wrong?)

Also illuminating are the responses received, which, for the Italian Government, constituted "guarantees", the most relevant of which reads as follows:

The Minister of Foreign Affairs hereby confirms that the Tunisian laws in force guarantee and protect the rights of prisoners in Tunisia and secure to them the right to a fair trial. The Minister would point out that Tunisia has voluntarily acceded to the relevant international treaties and conventions.

As the Court rightly points out, however, this is actually not a guarantee at all; rather a statement of why such is not necessary. But I want to end here with what is by far the strongest criticism handed down by the Court, which focuses not on the Italian but rather on the UK Government, expressed in the concurring opinion of Judge Zupančič. He noted that the UK's proposals for shifting the burden of proof "borders on the inquisitorial", before concluding that

there is simply no quid pro quo between “serious threat to the community” on the one hand and “the degree of risk of ill-treatment that the person may be subject to on return” on the other hand. The police logic advanced by the intervening Contracting State simply does not hold water. The question of the danger posed by the person to be expelled to the expelling party does not have an immediate bearing of any kind on the danger he might face if in fact expelled...

It is intellectually dishonest... to suggest that expulsion cases require a low level of proof simply because the person is notorious for his dangerousness... The only way out of this logical necessity would be to maintain that such individuals do not deserve human rights – the third party intervenes is unconsciously implying just that to a lesser degree – because they are less human.

Ouch.

Athletics and GAL: The Case of Dwain Chambers

The complex world of sports regulation throws up more than its fair share of difficult administrative relations and GAL issues; and none more so than the complex anti-doping regime pertaining to participation in the Olympic Games (for a detailed analysis of some of the issues involved from a GAL perspective, see this IILJ Working Paper by Alec Van Vaerenbergh).

The latest issue concerns the British sprinter Dwain Chambers, and his ongoing attempts to rejoin the athletic circuit after testing positive for steroids. Chambers served his mandatory 2-year ban, came back to athletics (with significantly less problems than he now faces), left to play American Football, and then sought to return to athletics again. This time, however, he found that attitudes within the UK had hardened to those who had taken drugs in the past, and has faced many calls to retire. He will represent the UK at the World Indoor Championships this week - although the selection committee made clear that they only agreed his selection extremely grudgingly, as they were legally bound - by their own rules and procedures - to do so.

Most interesting from a GAL perspective, however, is the conflict brewing over whether or not he will be allowed to represent the UK at the Beijing Olympics this summer. The British Olympic Association's (BOA) rules are clear: nobody who has tested positive for drugs will ever be eligible - barring the existence of certain mitigating circumstances - to represent the UK at the Games. It seems likely, however, that Chambers will seek to challenge the very legality of this rule, on the basis of its incompatibility with the Code of the World Anti-Doping Agency (WADA), which provides a mandatory 2-year ban for a first offence (Art. 10.2). The former head of that Organization, Dick Pound, has today supported such a claim, noting that

As a matter of law, I think the BOA would be on pretty shaky ground... If the BOA sought to deny me a place in the 2008 Olympic team on the basis solely of my earlier drugs offence, I would say that they don't have the power to do that... The BOA is a signatory to Wada's code - those are the rules that govern doping infractions - and the sanction for a first offence is a two-year suspension.

This provides us with an interesting set of administrative relations: on one hand, we have a private national body that is effectively exercising a number of public functions (e.g. rule setting), that is subject to a number of international rules (in particular, the World Anti-Doping Code, to which it is a signatory). Here, then, it looks like we have an atypical form of what Kingsbury, Krisch and Stewart have called "distributed administration" (where global regimes are administered by national bodies); atypical in the sense that the domestic regulatory authority is in this case a private body. Also, however, we have the nature of the international standard setter itself (WADA), a hybrid public-private body composed of representatives of the Olympic movement and governments. The relation between the two is the issue in question - and, in particular, whether the BOA is entitled to enforce stricter penalties than the WADA Code, or whether, in seeking to do so, it is in effect acting ultra vires.

According to the BBC, the BOA - the only national Olympic body to insist upon a lifetime ban for drugs cheats - is refusing to countenance backing down on this issue, and it looks as if the High Court in England will be asked to provide the ex post review function in this case, as a case before the Court of Arbitration of Sport would not be heard before the Olympics. Which means we should be have a definitive answer on the issue - from the standpoint of an English court at least - within the next few months. Watch this space...