Investor-State Arbitration: Lessons for Asia

This book is a report on the proceedings of the Conference on Investor-State Arbitration -- Lessons for Asiawhich was held on 7 December 2007 in Hong Kong under the auspices of the Hong Kong International Arbitration Centre. 

Over the past decade, the number of investor-state arbitrations worldwide, both before ICSID and in ad hoc proceedings, has grown dramatically. Investor-state arbitration has become the “new, new thing” in international arbitration. Until recently, however, Asia has largely stood apart from the explosion of activity in this field. Although most Asian jurisdictions are members of the ICSID Convention and many Asian states have entered into bilateral investment protection agreements with their trading partners, the number of investor-state arbitration cases involving Asian parties and Asian states has to date been relatively small.

There are clear signs on the horizon that this situation is set to change. More importantly, the number of bilateral investment treaties (BITS) entered into by Asia states is on the increase. Moreover, the region continues to be a magnet for foreign direct investment.

Of particular interest in this new equation is the growing importance of China, both as a destination for foreign investment and as a new capital exporter. China has to date entered into more than a hundred BITs. Moreover, in the most recent form of the Chinese BIT, the Chinese government has now agreed to accept claims directly against it for breaches of the protections offered to investors - a major departure from previous policy whereby the Chinese government would only accept international arbitration with respect to the quantum of compensation to be paid following a determination of liability under a BIT by a Chinese domestic tribunal.

Given the importance that investor-state arbitration is likely to play in Asia in the future, the Conference was aimed at providing legal practitioners and representatives from government and business in the region with an overview of the law and practice of investor-state arbitration. The HKIAC and Conference participants were privileged to have some of the world’s leading experts in investor-state arbitration address us on these topics and share with us their insight and experience.

Readers of this volume should note that the materials included here are based on a transcription of the recorded Conference proceedings and include, in most cases, the powerpoint notes that accompanied the live presentations.