A Legal Research On The Crisis Of Argentine International Investment Arbitration

Argentina was one of the richest countries in the world in the early 20's century. Argentina experienced a very serious economic crisis from the late 2001 to the early 2002. In order to alleviate the effect of the crisis, the government announced that Argentina was in a state of emergency, the parliament promulgated the law of emergency. The actions taken prevented the breakdown of the economy, meanwhile the foreign investors suffered tremendous economic loses. So many foreign investors filed the request for arbitration against the Argentina Republic with the International Centre for Settlement of Investment Disputes (ICSID). Up to the 20 August 2008, there are 47 cases against Argentina in the ICSID, most of which related to the economic crisis. In most of the cases concluded, Argentina was defeated. Thus Argentina experiences another serious crisis in the field of international investment arbitration. The phenomenon of Argentina is unprecedented in the history of ICSID and in the history of international investment arbitration.The subject of the dissertation is the crisis experienced by Argentina in the field of international investment arbitration. The dissertation will introduce the background of the crisis, trying to find out the reasons, discussing the measures Argentina taken in the international arbitral tribunals, the means will be taken in the courts of Argentina. The dissertation points out that the economic crisis directly caused the international investment arbitration crisis and the investment law reformation constitutes the basic reason. In the late 1990, Argentina signed lots of Bilateral Investment Treaties (BITs), which abandoned the Calvo Doctrine, accepted the jurisdiction of ICSID, and accorded the foreign investors high level protection. It is the BITs that caused the failure of Argentina in most of the cases. Trying to review the awards and denying them in the courts of Argentina is very unadvisable, which will lead Argentina to breach its international treaty obligation and will do harm to Argentina's reputation in the international business society.Just like Argentina, China is a developing country. The primary task of China is to stimulate the development of the economy. In order to improve the investment environment, China has changed its attitude to the BIT, giving the foreign investor high level protection. Despite now there are no cases against China in ICSID, China should make ready for it. China should amend the regulations of the BITs; balance the protection to the investors and the host state, thus avoiding the crisis.Besides preamble and conclusion, the dissertation comprises six chapters.Chapter 1 introduces the Argentina's international investment crisis briefly, which composed of three parts. Part 1 introduces the fundamental theory of international investment arbitration. Part 2 gives out the cases now Argentina facing. Part 3 discusses the background of the crisis.Chapter 2 analyzes the jurisprudential reason of the crisis. Firstly, the dissertation explicates the history and the meaning of Calvo Doctrine, finds out that Calvo Doctrine is the most powerful weapon that the developing countries could use to oppose the jurisdiction of international arbitration tribunal. Then the dissertation points out that Argentina abandoned the Calvo Doctrine when it signed the BITs, which caused the crisis.Chapter 3 analyzes another jurisprudential reason of the crisis. According to the BITs, Argentina accepted the jurisdiction of the international arbitration tribunals; meanwhile Argentina granted the foreign investors high level protection. It is the regulations of the BITs caused the crisis.Chapter 4 reviews the objections of Argentina to the cases in ICSID. The dissertation explicates and appraises the objections to the jurisdiction and to the merits, pointing out that the regulations of the Argentina's BITs caused the failure. The defects of international arbitration process aggravated the situation.Chapter 5 reviews the measures Argentina will take in its own country. Because the awards released contradicted each other, Argentine officials and scholars sternly criticized the ICSID system. The supreme court of Argentina also said that any awards that are unconstitutional, illegal or unreasonable must be reviewed by the Argentine courts. After analyzing the measures above, the dissertation indicates that it is unadvisable for Argentina to take such measures.Chapter 6 compares the Bilateral Investment Treaties signed by China with that of Argentina, putting forward the suggestions to perfect the BIT of China to prevent China from experiencing such crisis.