CYIL vol. 14 (2023)

NIKOLA KURKOVÁ KLÍMOVÁ CYIL 14 (2023) coercive policies in the first place. In theory, the unfairness of such an outcome could be addressed though the lenses of the doctrine of abuse of rights which was construed as a direct application of the good faith principle. 85 Given the high evidentiary bar for proving abuse, 86 it is unclear though whether such objections would be successful before arbitral tribunals. 5. Conclusion The armed conflict between Russia and Ukraine will bring a number of new opportunities for arbitral tribunals to contribute to the complex debate on the legality of unilaterally imposed measures with coercive effects from the perspective of existing IIAs. While the qualification of their effects can be largely derived from the investment jurisprudence on criminal asset freezing and seizure, in assessing potential defences of respondent States against investors’ claims the arbitrators will have to embark on a thorough investigation of the substance of such measures under general public international law rules. When navigating in the uncharted territory, arbitrators should adopt a cautious approach and examine meticulously the specific design of the sanctions to avoid any conceptual confusion which would unduly restrict the sovereign powers of States in shaping their foreign policies. With a series of disputes related to the negative impact of unilateral coercive measures looming, it remains to be seen to what extent the various means of economic warfare are compatible with the protection of individuals’ rights. As the recent jurisprudence of the Court of Justice of the European Union suggests, their legality will heavily depend on the nature of the link between the targeted person and the actions which are subject to sanctions. 87 Where the individual or legal entity is directly engaged in undesirable behaviour, the interference with investor’s rights could arguably find justification either through the customary international law doctrine of police powers or exception clauses in modern IIAs. The situation would be, however, more complicated in relation to natural or legal persons that are merely tied to the primary targets by family or corporate bonds, having no association with the sanctioned acts. In such scenarios, the type and intensity of such ties as well as the contribution of the restrictive measures to the fulfilment of their purported goal should occupy the centre of arbitrators’ attention.

85 United States – Import Prohibition of Certain Shrimp and Shrimp Products , Appellate Body Report, 15 May 1998, WT/DS58/AB/R, para. 158. 86 Immunities and Criminal Proceedings (Equatorial Guinea v. France) (Preliminary Objections, Judgment) [2018] ICJ Reports, 292, para. 147. 87 Judgment of the General Court of 8 March 2023, Prigozhina v Council , Case T-212/22, ECLI:EU:T:2023:104, paras. 95–98.

408