A Study On Issue Of State Counterclaims In International Investment Arbitration

Since the 1990s,multinational corporations have played a more and more important role in the global economy and the law of international investment has also been rapidly developed.In order to promote and protect the development of international investment and provide a stable investment environment for foreign investors and their investments.Dominated by developed countries,all countries have started to conclude bilateral investment treaties.As the main purpose of international investment treaties is to encourage foreign investment,they usually do not stipulate the rights of host countries to investors and the investors'obligations to the host country.Therefore,the current international investment law has the obvious asymmetry of investor rights and host country obligations.Although both the ICSID Convention and other rules of arbitration provide for the principle of allowing counterclaims by States,the host country seldom files counterclaims in investment arbitrations and have almost never succeeded.This article studies the related investment treaties and arbitration cases and discusses two obstacles that the host country faces in filing counterclaims in the investment arbitration,that is,the parties consent and the requisite connection between counterclaims and the principle claim.The consent of the parties is an important basis for the jurisdiction of the arbitral tribunal.Any dispute over the investment submitted to arbitration requires the consent of both the foreign investor and the host country.This article mainly analyzes the impact on the jurisdiction of the arbitral tribunal from the scope of the dispute,the applicable law provisions,the parties' locus standi and the exclusive jurisdiction clause.Generally believed that assess the necessary connection need to be based on both legal and factual connection.Unlike contractual arbitration,investment treaty arbitration has its own particularity because there is often no direct legal relationship between the foreign investor and the host country.However,in the arbitration of investment treaty,the arbitral tribunal neglected the particularity of the treaty arbitration and evaluated it according to the previous arbitration cases.This article compares and analyzes the current assessment methods of the necessary connection by examining the connection requirements in international law and investment treaty arbitrations.