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International Commercial Law - Investor-State Arbitration: Current Challenges and Reforms

Can you answer these practice questions about international commercial law? Good luck!
Based on a course by Andreas von Goldbeck.
Quiz by baptistegorce
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Last updated: October 12, 2024
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First submittedOctober 12, 2024
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1. A Canadian investor, Jane, has invested in renewable energy projects in a developing country, EcoLand. The government enacts new regulations that limit carbon emissions, affecting her business. Jane is considering filing for ISDS. What is the main concern Jane might face?
Jane might face challenges because the regulations are meant for public welfare, she must provide sufficient evidence, and the host country can argue it is exercising its right to regulate.
The regulations are intended for public welfare.
She might not have sufficient evidence for her claim.
The host country may argue it’s exercising its regulatory rights.
All of the above.
2. An Australian company, Outback Foods, feels that the ISDS ruling that it received is inconsistent compared to rulings against other companies. They question the fairness of the process. What could be a reason for these inconsistencies?
Different interpretations by arbitrators can lead to inconsistent rulings in ISDS cases.
Arbitrators may interpret laws differently
All cases are treated equally under the law.
Investors from developing countries always lose.
The law does not allow for appeals.
3. A foreign pharmaceutical company challenges new regulations in HealthLand that require drug price controls. The government argues these regulations are essential for public health. How can HealthLand strengthen its defense?
Highlighting the public health benefits can strengthen HealthLand’s position against ISDS claims.
By eliminating the regulations to avoid claims
By demonstrating that the regulations benefit public health.
By filing its own ISDS claim against the company.
By claiming that the investor is not a legitimate business
4. A UK investor, Sarah, finds that her ISDS claim against an EU member state for revoking mining rights has been dismissed due to lack of evidence. What issue does this highlight about the ISDS process?
: Investors need to provide sufficient evidence to support their claims in ISDS cases.
The process lacks fairness for investors.
The burden of proof is on the investor.
Investors can’t win claims against sovereign nations.
All cases must go to public court first.
5. An EU member state introduces a new tax on sugary drinks to reduce health issues. A multinational beverage company files an ISDS claim against the state. What could be a valid argument for the state to defend its tax?
Defending the tax as a public health measure supports the state’s regulatory rights.
The tax is a temporary measure
The tax is necessary for public health initiatives.
The company can afford to pay the tax.
The tax will increase overall revenue.
6. A local activist in AquaLand raises concerns that ISDS cases are not open to public scrutiny. What primary issue does this raise?
Public scrutiny is a key issue, and transparency is often criticized in ISDS proceedings.
Lack of transparency in the ISDS process.
The high number of cases filed.
Investor dissatisfaction.
Delays in arbitration.
7. An investor from a different EU member state challenges an EU country regarding new environmental regulations based on a bilateral investment treaty. Which ruling would likely support the state’s argument against the ISDS claim?
The Achmea ruling established that ISDS claims within the EU are incompatible with EU law, supporting the state’s position.
The Achmea case
The Micula case
The Energy Charter Treaty
The ICSID Convention
8. An investor believes an arbitrator in their ISDS case has a conflict of interest due to previous work with an opposing party. What reform could address this concern?
Disclosure of conflicts can help ensure impartiality in arbitration, addressing concerns about bias.
Introducing stricter qualifications for arbitrators.
Allowing public access to all arbitration documents
Increasing the number of arbitrators.
Ensuring arbitrators disclose any potential conflicts of interest.
9. A global fast-food chain challenges a new regulation in a developing country aimed at reducing unhealthy eating. How might the government justify the regulation in ISDS proceedings?
This justification aligns with the state’s right to regulate for public health, reinforcing its legal standing.
By saying it follows international trends.
By arguing it promotes public health and welfare.
By claiming it will boost tourism.
By asserting that the regulation is voluntary.
10. A group of countries proposes creating a permanent international investment court to replace the current ISDS system. What is one key benefit of such a court?
A permanent court aims to create consistency and reliability in resolving investment disputes, addressing some criticisms of the current system.
It would speed up the resolution of disputes.
It would eliminate all investor protections.
It would provide a consistent framework for dispute resolution.
It would increase the number of cases filed.
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