Report: Frankfurt Roundtable on Current Issues in Investment Arbitration

While students were finalizing their arguments for the Frankfurt Investment Arbitration Moot Court starting the next day, some 25 Alumni and Friends of the School of International Arbitration gathered at the premises of the University of Frankfurt for a Roundtable on current issues in Investment Arbitration. On the menu: four speakers, four topics and a lot of opportunity for discussion.

The roundtable was opened by Maarten Draye (Hanotiau & van den Berg, Brussels; chair of the AFSIA Steering Committee), who expressed his content to be able to open an event organised by the AFSIA Steering Committee after a long period largely away from the spotlight for organisational reasons, and briefly introduced the different topics of the afternoon. His welcome was extended by Professor Rainer Hofmann (University of Frankfurt), who indicated that it was a pleasure to be able to return a favour to the SIA by hosting the roundtable, as the School has been supporting the Frankfurt Investment Arbitration Moot Court since the beginning.

Then the floor was left to the speakers, who were all aptly introduced by Professor Loukas Mistelis (SIA/CCLS, Queen Mary, University of London), who agreed to chair and moderate the roundtable event.

First speaker of the afternoon was Franz Schwarz (Wilmer Hale, London), who addressed the question whether - against the background of the development of investment arbitration to the primary method for the settlement of foreign direct investment disputes in recent years - Investment Arbitration is today becoming too burdensome and costly for investors.

The second topic of the afternoon, covered by Tim Schreiber (Clifford Chance, Frankfurt/M­­ünchen), related to Arbitrator Selection in Investment Arbitration. Prior to appointing arbitrators, a due diligence is usually conducted whereby particular attention is given to any published legal opinions regarding the issues in dispute and the arbitrator's track record. One of the issues that has provoked quite some debate recently is the question whether arbitrators in investment cases should by default be appointed by institutions rather than by the Parties.

A third contribution related to the issue of enforcement and execution of awards in international investment cases. While the concept of sovereign immunity from execution has already undergone a substantial evolution through time, some argue that the precise limitation of the scope of such immunity still requires further refinement. The question as to whether new rules on immunity from execution would be needed, was addressed by Christian Leathly (Herbert Smith, London).

In the final topic of the afternoon, Dr. Sabine Konrad (K&L Gates, Washington D.C./Frankfurt; AFSIA Steering Committee) looked at how the principle of full reparation established in in the Chorzów Factory case – providing that an aggrieved investor is to be fully compensated for the loss it has suffered as a result of a host State's wrongful act – had manifested itself in the debate on interests. After identifying the various methods of calculation of interests adopted by Investment Arbitration Tribunals, she addressed the issue as to whether and to what extent these methods yield convincing results from a financial and economical point of view.

A drinks reception offered by Clifford Chance concluded this afternoon of interesting presentations and lively discussions, of which the programme was put together by Dr. Stavros Brekoulakis and Dr. Sabine Konrad.

The AFSIA Steering Committee would like to thank the University of Frankfurt, in particular Professor Hofmann and his assistants Philip Donath and Jakob Kadelmacher, for their hospitality and invaluable support in organizing this roundtable, as well as the SIA, the afternoon's speakers and sponsor Clifford Chance.