Research On The Issue Of Transparency In International Investment Arbitration

With the rapid development of international investment activities,investment disputes continue to emerge.The disputes between investors and host countries based on investment often take the form of arbitration.The confidentiality is the key different between arbitration and other dispute resolution mechanism.It is the nature of confidentiality that can protect parties from disclose relevant information to the public,therefore,arbitration is welcomed by investors from all countries.However,in the vast majority of cases,the final arbitral awards are often beneficial to investors,which allows investors to use the arbitration mechanism as an important maintenance measure for their own interest.Over time,investment arbitration has attached too much emphasis on the private interests protection and has overly neglected the public interests of the host country incur criticism from the international community.Moreover,due to uniqueness of international investment arbitration in subject,controversial matters and jurisdiction basis,the traditional confidentiality of the arbitration may result in unfair treatment of the public interest of the host country,because the public of the host country has been lacking reasonable and possible access to arbitration information so that it is enable for the public to protect their legitimate rights and interest in a timely,lawful and reasonable manner.As a result,the legitimacy of international investment arbitration mechanism has been increasingly questioned and criticized.In order to resolve this crisis,it is imperative to strengthen the transparency of the arbitration mechanism,that is,to allow prescribed individuals to participate in or publish the prescribed documents to the public during the arbitral proceedings.The application of transparency principles satisfies the public's eagerness to know andtake part in in arbitral proceedings,meanwhile protecting the rights and interests of private investors,entitles the public to express their opinions in a regulated manner and supervises the international investment arbitration tribunal to make impartial arbitral awards.In the development of transparency reform in the international investment arbitration field,the most important and influential reform on international investment arbitration rules includes the North American Free Trade Agreement Rules(hereinafter as “NAFTA Rules”),the International Center for Settlement of Disputes(ICSID)Arbitration Rules(hereinafter as “ICSID Rules”)and the UNCITRAL Arbitration Rules.This essay will elaborate on the reform process of transparency principles in the above three international rules.Among them,the NAFTA Rules first stipulated the principle of transparency by way of an interpretative statement made by the Free Trade Commission.The attitude of the ICSID Rules to the principle of transparency has undergone changes from opposition to support.It revised the arbitration rules in 2006,and the application of the principle of transparency is mainly reflected in the means and scope of third party participation in arbitration proceedings and the duty for arbitral tribunals to make the abstract part of the legal reasoning in the judgment in to public.The transparency reform of UNCITRAL Arbitration Rules was the most comprehensive and complete.In July 2013,the Rules on Transparency was adopted.1The Rules on Transparency comprehensively stipulates provisions on the publication of information at the commencement of arbitral proceedings,publication of documents,submission by a third person,public hearings and exceptions to transparency,which have become the latest reform result of the transparency in the international investment arbitration.As a country with dual identity of capital importing countries and capital exporting countries,China accepts international investment arbitration to resolve investment disputes in numerous Sino-foreign investment protection treaties and free trade agreements.With the continuous progress of the “One Belt One Road”,the pace of “going-global” for Chinese enterprises is accelerating.There will be more and more investment dispute arbitration cases between Chinese investors and foreign host countries and cases that China acted as the host country.The desire to pull foreign-related investment disputes back to home is growing stronger.Therefore,the localization of the principle of transparency in international investment arbitration is a must option.In October 2016,the Shenzhen International Court of Arbitration issued the “Arbitration Rules of the Shenzhen International Court of Arbitration(2016edition)”,which for the first time included investment arbitration in the applicable scope.It is the first Chinese mainland arbitration rule that has jurisdiction over dispute between the host country's government and the foreign investors.In September 2017,the China International Economic and Trade Arbitration Commission formulated the "International Investment Dispute Arbitration Rules",which is the first international investment arbitration rules formulated by the domestic arbitration institution,and such rules promotes the process of localizing the transparency of international investment arbitration.In the domestic "Investment Arbitration Rules",the provisions concerning the principle of transparency are mainly reflected in the public hearing of arbitration proceedings,the submission of written opinions by third parties,and the disclosure of information in arbitral proceedings.Under the premise of conforming to China's domestic conditions,the provisions of the domestic investment arbitration rules are designed to some extent with reference to the rules of the international investment arbitration institutions.These essay will elaborate on the above provisions;compare them with rules in NAFTA Rules,ICSID Rules and UNCITRAL's Transparency Rules;analysis of the rationality of the provisions of the domestic investment arbitration rules in relation to the principles of transparency and the areas to be improved.In order to better structure the domestic investment arbitration mechanism and respond to the reform of the principle of transparency in international investment arbitration,it is recommended that the existing investment arbitration rules shall be refined to enhance operability;the construction of non-governmental organizations shall be strengthened to provide effective and professional third-party opinions;and properly incorporate the principle of transparency in arbitral proceedings into the investment agreement signed by China.