CYIL 2014

ZUZANA JAHODNÍKOVÁ – CYIL 5 ȍ2014Ȏ the ICSID sought to decline its jurisdiction. The Court, however, looked at the nature of the claims and decided that there is a need to also consider the BIT breach since “contractual claims arising out of the Contract do not have the same cause of action as the Treaty claims”. 82 The Tribunal went on to rule that, when the conduct of the State results in actions which cause a breach of contract and, at the same time, constitutes a violation of the Treaty, the Tribunal both would be appropriate for and would accept the jurisdiction, in spite of the Contract’s jurisdiction clause. Choosing the route of avoiding the danger of parallel proceedings through the usage of fork-in-road clauses seems like a suitable way to forestall the commencement of several proceedings. In spite of the fact that this could be a straightforward approach setting the conditions of investment litigation prior to a dispute, one cannot omit the fact that certain problems arise when the exercise of domestic procedural rights is ambiguous. This could make it rather difficult to pass a judgment on whether these actions are triggering the applicability of the fork-in-road clause. As some authors pertinently pointed out, an approach which would narrow the application of these clauses to every action of an investor undertaken within the national legal order would lead to a situation where “guarantees of effective domestic remedies (would be) traps designed to lure an investor into domestic proceedings with the consequence that the door to international arbitration will be closed forever no matter what the outcome of the domestic proceedings may be”. 83 However, given the complexity of these clauses and their limitations, in practice, they have had very little application so far. As one commentator said, arbitral tribunals have demonstrated a tendency to deprive these clauses of their genuine meaning by never applying them in favour of a state. 84 4.5 Parallel Litigation and the Denial of Justice Indeed, the position of defying arbitration in conjunction with an intercurrent process aimed at ceasing foreign adjudication constitute a basis for novel claims brought about by investors. This could be seen in a scenario where a State’s court acts in collusion or conspiracy with the State’s executive to obstruct an investor’s pursuit of arbitration. Subsequently, in this case, it too has committed a denial of justice and a breach of internationally accepted principles of arbitration law, for which the State is responsible. 85 However, this prohibitive conduct could perhaps under some circumstances not pass unnoticed and without any consequence. but rejected the jurisdiction to rule on the contractual claims. The Tribunal held that “it is a claimant’s prerogative to formulate the claims that it is asking the judges to resolve” and that the alleged claims have to be assessed in the further stages of the proceedings. SGS v. Pakistan , Decision of the Tribunal on Objections to Jurisdiction, paras. 89-90. 82 Toto Costruzioni Generali S.p.A. v. Republic of Lebanon, supra note 80, Decision on Jurisdiction, 11 September 2009, para. 211, p. 61. 83 Ch. Schreuer, “Travelling the BIT Route.”, supra note 71, p. 249. 84 P. Muchlinski, F. Ortino, Ch. Schreuer, supra note 58, p. 1027. 85 R. Garnett, supra note 26, p. 488 with reference to the Saipem SpA v Bangladesh ICSID case No. ARB/05/7, Award of 30 June 2009 para. 147. MILOŠ OLÍK

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