Application On Fork-in-the-road Clause Of BITs In ICSID Arbitration Practice

This paper studies the application of BITs' fork-in-the-road clause in the practice of ICSID arbitration from an empirical perspective,and analyses the results of the application of "triple identity" standard in past practice,which leads to the existing in name only of the fork-in-the-road clause,as well as the new problems that the fork-in-the-road clause in the new period is facing which are evaded by other rules.Therefore,constructive suggestions are put forward for the practice of international investment and the rebuilding of BITs.This paper is divided into four parts.The first part of the article summarizes and introduces the application status of the fork-in-the-road clause in ICSID,clarifies its embarrassing position in the name of existence,and the current application status is contrary to the purpose of its establishment,which leads to not only not eliminating parallel procedures,but also not balancing the interests of investors and host countries,and impacting on the principle of exhaustion of local remedies in traditional international law.The confusion in application has resulted in the lack of predictability of BIT clauses,so that investors and host countries can not get predictable guidance from the rules.This has also aroused many countries' discontent and questioned the legitimacy of ICSID.The second part of the article writes that ICSID abuses the principle of res judicata to strictly explain the fork-in-the-road clause,which is one of the reasons for the existence of the clause,but also the main reason.The reason for this situation is that the arbitral tribunal adopts the criterion of triple identity to rigidly divide the cases of "parties","causes of action" and " objects of the dispute ".Contract litigation and treaty litigation,domestic law litigation and international law litigation,shareholder and company,parent company and subsidiary company,host country and local government,are therefore identified as different entities,which often make the fork-in-the-road clause not applicable,investors receive double relief from host country and international arbitration,and then national interests of host country are ignored.The third part of the article analyses the arbitration practice of avoiding the cross-section clause by other rules,which is another reason why the clause has been shelved.In recent years,arbitral tribunals have gradually adopted the "fundamental basis" instead of the triple identity standard.By judging whether the essence of the case is the same,the jurisdictional objection based on the fork-in-the-road clause can be established.However,arbitration practice has also exposed the tendency of the new problem,that is,whether MFN treatment can be applied to dispute settlement matters including the fork-in-the-road clause.Many arbitral tribunals have endorsed such an approach,thereby invoking more favourable treatment in BITs between host and third-party countries,thus circumventing the role of the fork-in-the-road clause on another road.This will also lead to investor purchase treaties,infringement of the sovereignty of the host country,and being inconsistent with the purpose of "anti-discrimination".The fourth part of the article aims at the above analysis of the reasons for the circumvention of fork-in-the-road clause,and explores how to make reasonable choices to deal with the current application status of this clause.Firstly,the article compares and analyses the "no U-turn" clause which has similar value.In order to reconstruct the crossroads clause,we should draw lessons from it and stipulate explicitly "investment disputes" and "parties".However,we should keep the final character of the fork-in-the-road clause unchanged,and increase the exceptions clause to increase the rationality.Second,restricting the arbitral tribunal from applying MFN clause treatment to dispute settlement matters.The host country respectively determines the scope of application of the MFN clause by means of exchange of letters and clear agreement between the BITs that have been concluded and the BITs that have not been signed or need to be restructured.In addition,ICSID can support and promote the gradual establishment of a multilateral standing appeal mechanism to resolve the "crisis of trust" caused by parallel procedures and inconsistent decisions.