BUSINESS AND HUMAN RIGHTS / Šturma, Mozetic (eds)

Nevertheless, the tribunal pointed out that “the situation would be different in case an obligation to abstain, like a prohibition to commit acts violating human rights, would be at stake. Such an obligation can be of immediate application, not only upon States, but equally to individuals and other private parties.” 36 However important a breakthrough the Urbaser decision was, we should not overestimate the role of counterclaims in investment arbitration. This possibility is based on Article 46 of the ICSID Convention and Rule 40 of the ICSID Arbitration Rules. 37 This seems to question the possibility for the host State to advance a counterclaim against the investor before ad hoc arbitration tribunals. However, even in the ICSID arbitration, as shown by the Gavazzi case, 38 the Tribunal may prefer the textual interpretation of the respective BIT. The Tribunal, by a majority decision, did not accept “that the right of the Host State to file a free-standing counterclaim in an investment treaty arbitration should be presumed unless expressly excluded by the BIT… Where there is no jurisdiction provided by the wording of the BIT in relation to a counterclaim, no jurisdiction can be inferred merely from the ‘spirit’ of the BIT.” 39 In addition, and by contrast to Urbaser , the counterclaim in Gavazzi was an independent claim based upon Romanian law, not a claim based on the alleged violation of international human rights law. According to the view of the Tribunal, the BIT does not indicate that Romanian law would apply to the substance of the dispute either, 40 or to the procedural law applicable to this arbitration. 41 This case thus shows that the accepted counterclaims by the host State remain exceptional in investment arbitration. 5. Another alternative path: a new UN treaty on business and human rights? This book aims at discussing the relevant issues of business and human rights on the basis of the existing law ( lex lata ), both international and internal, and its interpretation by international and national judicial bodies. This is the reason why it can pay just a cursory attention to the recent proposals of a binding instrument to regulate business activities with respect to human rights. Although this project is conceived rather as a general, along-standing initiative within the UN Human Rights Council, without a direct link to international trade and investment law, it may have certain, albeit indirect, impact on negotiation and interpretation of international investment agreements (IIAs). 36 Ibid., par. 1210. 37 Cf. Art. 46 of the ICSID Convention (1965): “Except as the parties otherwise agree, the Tribunal shall, if requested by a party, determine any incidental or additional claims or counterclaims arising directly out of the subject-matter of the dispute provided that they are within the scope of the consent of the parties and are otherwise within the jurisdiction of the Centre.“ (for the text see https://icsid.worldbank.org/en/ documents/icsiddocs/icsid%20convention%20english.pdf ) 38 Marco Gavazzi and Stefano Gavazzi v. Romania, ICSID Case No. ARB/12/25, Decision on Jurisdiction, Admissibility and Liability, 21 April 2015.

39 Ibid., par. 154. 40 Ibid., par. 156. 41 Ibid., par. 158.

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