Research On The Counterclaim Of Host Country In International Investment Arbitration

Since the 21 st century,with the rapid development of international investment,international investment disputes occur frequently.Meanwhile,the international investment arbitration mechanism is considered to have a legitimacy crisis because of its investor bias.Although the international community has taken measures to deal with the problem and intends to reform the mechanism,but the reform process is slow.In this context,the value of the state counterclaim can be revealed.However,in practice,the state counterclaims are accepted and supported in a low proportion.The reason is that on the one hand,the scope agreed by both parties in the dispute will be interpreted as excluding the counterclaim;on the other hand,the arbitration tribunal has higher requirements on the relevance of counterclaim.Therefore,this paper focuses on the identification of the consent of both parties and the relevance between counterclaims and arbitration claims in the dispute.On the issue of the determination of consent,this paper holds that when determining whether the two parties in dispute have reached an arbitration agreement on the counterclaim,the arbitration tribunal is affected by the "no tacit agreement arbitration" characteristics of investment arbitration.On the one hand,it judges whether the host country has excluded the counterclaim when signing the contract according to the dispute settlement clause and the applicable law clause in the international investment treaty;on the other hand,it judges whether the counterclaim has been excluded according to the investor’s request for arbitration The act of arbitration presumes that the investor has accepted the agreement on the scope of dispute in the treaty.On the issue of relevance,most scholars believe that it belongs to the issue of admissibility,however,this paper argues that from the concept of jurisdiction and admissibility,relevance should be defined as the issue of jurisdiction.In addition,this paper argues that in order to avoid the high probability of rejection of counterclaim cases due to the high relevance standard,the factual relevance theory should be adopted,that is,as long as the counterclaim and the arbitration claim involve the same investment fact,it can be determined that there is relevance between them.Finally,based on the fact that China is both a capital importing country and a capital exporting country,as well as the frequent occurrence of investment disputes in recent years,in order to better protect the public interests of the country,this paper suggests that China should appropriately include the counterclaim rule and the investor’s obligation clause when concluding international investment treaties in the future,and at the same time,the limitation on the scope of disputes should not be too much,so as to avoid being an obstacle for the state to file a counterclaim in the future.