International Rule of Law and constitutional justice PDF

1
FINAL PROJECT SUBMISSION
PROJECT TITLE: INTERNATIONAL RULE OF LAW AND CONSTITUIONAL
JUSTICE IN INTERNATIONAL INVESTMENT LAW AND ARBITRATION: A
CRITICAL ANALYSIS.
TEAM MEMBERS:
PARVATHI SUBASH (160401402092)
MUHAMMED ANEES (16040142080)
COURSE: BBA LLB (2016-2021)
SESSION: JAN-JUNE 2021
SUBJECT: International Investment Law.
SUBJECT COORDINATOR: Prof. Gyanashree Dutta
Alliance School of Law
Alliance University, Bangalore.
Submitted Date: 27th May, 2021.
1

2
ABSTRACT
One of the oldest paradigms of constitutional justice is judicial administration of justice
through reasoned interpretation, implementation, and explanation of legal principles and
laws. The procedural justice principles that underpin investor-state arbitration are still up for
debate, particularly if confidentiality and party autonomy, which regulate commercial
arbitration, risk overlooking adversely affected parties. There are also concerns that rule-
following and formal equality of foreign investors and home states may not guarantee
substantive justice in the settlement of investment disputes unless arbitrators and courts take
their customary law responsibilities of resolving disputes in accordance with governments'
human rights obligations and other standards of justice requiring judicial balancing more
seriously. Judges' constitutional duty to enforce the law and resolve disputes in accordance
with justice principles which necessitate a review of whether judicial logic is still consistent
with redistributive principles of case-specific fairness, social justice, and corrective justice.
Keywords: Judicial Administration, Arbitration, Customary Law and Constitutional Duty.
2

3
TABLE OF CONTENTS
1. CHAPTER 1- INTRODUCTION.
a. BACKGROUND.
b. RESEARCH PROBLEM
c. LITREATURE REVIEW
d. HYPOTHESIS
e. RESEARCH QUESTION
f. SCOPE AND LIMITATION
g. RESEARCH OBJECTIVE
h. RESEARCH METHODOLOGY
1. CHAPTER 2- TENTATIVE CHAPTERS
a) Introduction and History International Rule of Law, Arbitration and
International Investment law.
b) Investment Treaties and the Rule of Law and Rule of Law Objectives
of Investment Treaties.
c) Investment Treaty Arbitration as Judicial Review.
d) The Rule of Law as a Benchmark for Investment Law
e) Whether the Human Rights is playing a part in International
Investment Law and Dispute Resolution?
f) Constitutional justice is appropriate paradigm for commercial
investor-state arbitration.
g) Conclusion and Suggestion.
3. CHAPTER 3: BIBLIOGRAPHY
3

4
INTERNATIONAL RULE OF LAW AND CONSTITUIONAL JUSTICE IN
INTERNATIONAL INVESTMENT LAW AND ARBITRATION : A CRITICAL
ANALYSIS
Introduction
International investment law became mainstream in the international law community just in
the previous decade. This was mostly due to the rapid growth of investment treaty-based
dispute resolution, which went from its first application in the late 1980s in Asian
Agricultural Products v Sri Lanka to over 560 treaty-based investment conflicts in 2013.
Despite their numerous numbers, investment treaties have a relatively uniform structure,
establish relatively uniform principles for the treatment of foreign investors, and rely on a
common dispute resolution mechanism, resulting in a regime that is arguably comparable to
that of a multilateral system. Investors normally have the right not to be expropriated without
compensation, to be treated fairly and equitably, to have complete protection and security,
and to be treated no less favorably than national or third-country investors under investment
treaties. Furthermore, investment treaties normally provide foreign investors with recourse to
arbitration against the host state in order to file claims for breach of the treaty's provisions,
usually in the form of damages. This allows them to bypass domestic courts and file a claim
under international law without the necessity for diplomatic protection from the investor's
home country. This has the potential to have a significant impact on the behaviour of all
branches of domestic government, including the legislative, administrative, and judicial
branches. As a result, international investment law provides a unique level of protection for
foreign investors, combining public law limits with private-public arbitration as a means of
resolving disputes. The rise of investment treaties and investment treaty arbitration has
sparked a heated debate regarding the benefits, justifications, and challenges of this unique
regime for foreign investors in a relatively short period of time. Indeed, this argument has
morphed into what is commonly referred to as an international investment law "legitimacy
issue." The departure of some states from the (BITs) and the International Centre for
Settlement of Investment Disputes (ICSID); the efforts of many nations to re-calibrate their
investment treaty duties and reassess investment treaty arbitration; and, by now, a more
widespread public debate about the potentially negative effects of investment treaties on
states' authority to regulate are all symptoms of this crisis.
1.1 BACKGROUND:
4

5
Part I of this article explains how multilevel constitutional constraints on abuses of authority
and multilevel judicial enforcement of constitutional justice, such as in the review and
acceptance of foreign arbitral awards and court judgments, international annulment
proceedings, and appellate review of disputes, have led to the emergence of rule of law in
international trade and investments.1 Part II claims that a number of alternative dispute
resolution mechanisms, such as private commercial arbitration, national courts, investor-state
arbitration based on regional agreements, regional economic or human rights courts,
worldwide courts, and alternative dispute resolution bodies, can be used to resolve
international investment disputes.2 International investment treaties are one of the most
important tools for promoting the rule of law in investor-state relationships. For a long time,
these were little-known and little-used international law tools by which governments, usually
on a bilateral basis, but increasingly often also regionally and in some circumstances even in
multilateral instruments, negotiated agreements. Critics doubt arbitrators' democratic
accountability, independence, and impartiality, object to the ambiguity of treaty criteria,
criticise arbitrators' interpretations of these requirements for restricting host governments'
power to regulate in the public good, and reject the institution of investor-state dispute
settlement. On the other hand, proponents of investment law have done a poor job of
explaining the system's merits for years. One of the advantages of investment treaties and
investment treaty arbitration is that they help to provide a rule of law framework for
investment relations based on international law, which domestic regulation of foreign
investment may not be able to do. Investment treaties, particularly in nations with a weak
domestic rule of law, can help build the legal and institutional infrastructure needed to attract
foreign investment into businesses and projects that help the host state grow, as indicated, for
example, in Agenda 21 of the United Nations Conference on Environment and Development.
1.4 RESEARCH PROBLEM
That rule of law in international investment law and arbitration requires multilevel judicial
cooperation and more comprehensive judicial balancing of private rights and corresponding
constitutional obligations of governments. During the last decade that international
investment law became mainstream in the international law community. This was principally
due to the growing dispute settlement practice under investment treaties.
1.2 LITERATURE REVIEW
1 Werner,M. Meldelson, ‘The Journal of World Investment and Trade’ [2005].2 Ibid.
5

6
Surya P. Subedi, ‘International Investment Law, Reconciling Policy And Principal,
‘https://www.google.co.in/books/edition/International_Investment_Law/x-
PrDwAAQBAJ?hl=en&gbpv=.0’, Accessed on 1st March, 2021.
In this paper, the researcher has pointed out that tension between the law of foreign
investment, incorporating an overview of the care available to foreign investors in
international law, and ways to achieve a balance between these values and the need to
preserve foreign investors' legitimate rights and expectations on the one hand, and the
need not to limit host governments' ability to enforce their public policies unduly on
the other.
Francesco Francioni “Access to Justice, Denial of Justice and International
Investment
Law” (2009), < https://doi.org/10.1093/ejil/chp057 > accessed 29th February 2020.
This article stressed the importance of a dialogue between national courts as a
condition for a shared understanding of the reach and limits of sovereign immunity as
a persistent
Obstacle to the effective exercise of the right of access to justice with regard to the
unique problem of access to justice of extraterritorial investors, as in the case of
Argentine bonds.
Pierre-Marie Dupuy, ‘Human Rights in International Investment Law and Arbitration’
(2009), <
https://www.google.co.in/books/edition/Human_Rights_in_International_Investment/
i98VDAAAQBAJ?hl=en&gbpv=0> accessed 12th May,2021. In this book, It
examines the relationship between international investment law, investment
arbitration, and human rights, including the role of national and international courts,
investor-state arbitral tribunals, and alternative jurisdictions, the dangers of legal and
jurisdictional fragmentation, and the human rights components of investment law and
arbitration. the connections between substantive and procedural justice principles and
international investment law, it highlights the main results of the 24 book chapters and
contextualizes them in terms of justice principles, global administrative law, and
multilevel constitutionalism.
Rudolf Dolzer (jurist), Christoph Schreuer, ‘Principles of International Investment
Law’(2012), <
https://www.google.co.in/books/edition/Principles_of_International_Investment_L/
qS0UDAAAQBAJ?hl=en&gbpv=0> accessed on 2nd May,2021. This book explains
6