The Journal of

WORLD INVESTMENT & TRADE

ABSTRACTS

Stephan W. Schill: Most-Favored-Nation Clauses as a Basis of Jurisdiction in Investment Treaty Arbitration—Arbitral Jurisprudence at a Crossroads

Most-favored-nation (Mfn) clauses figure prominently in the currently more than 2,500 bilateral investment treaties as well as in the few multilateral treaties in the field and are increasingly often invoked and applied in investor-State dispute settlement. While the application of Mfn clauses to substantive standards of treatment has caused relatively little contention, the jurisprudence is fundamentally split on whether the clauses can apply to matters of arbitral jurisdiction. After analysing the jurisprudential split that has emerged, this paper argues that Mfn clauses, in principle, can serve as a basis of jurisdiction by extending the offer to arbitrate made by the host State vis-à-vis investors covered under third-country investment treaties to those investors covered by Mfn treatment. This effect is not only in conformity with the rationale and function of Mfn clauses and the methods of treaty interpretation; it also conforms to the more fundamental interest in making States comply with their investment treaty obligations and has a positive impact on harmonizing the investment protection regime in place in a host State for all investors irrespective of their national origin.

Dr Stephan W. Schill, Dr. iur. (Johann Wolfgang Goethe-Universität Frankfurt am Main), LL.M. International Legal Studies (New York University), LL.M. Europäisches und Internationales Wirtschaftsrecht (Universität Augsburg), is a Rechtsanwalt (admitted to the bar in Germany) and Attorney-at-law in New York. He currently serves as the International Arbitration Law Clerk to The Honorable Charles N. Brower, Arbitrator with 20 Essex Street Chambers in London.

Luan Xinjie and Julien Chaisse: Why Will China Establish a Government-Sponsored Response Mechanism in Countervailing Games?

In recent years China has faced numerous countervailing duty investigations among others by the United States and Canada . Reactions to countervailing measures are usually much more policy-oriented than market-oriented. Whereas the dominant strategies adopted by the individual exporting enterprises are usually not the payoff dominant ones, China is tending towards establishing a government-sponsored countervailing response mechanism (Gscrm). With the Gscrm, the bounded rationality of the export enterprises in the countervailing counter-action can be eliminated and therefore payoff dominant equilibrium in a countervailing-responding cooperation game can be achieved 

Luan Xinjie is Professor and Director of the International Trade Institute of China Jiliang University in Hongzhou , China and Guest Senior Researcher at China-s World Trade Organization Institute of the University of International Business and Economics in Beijing .

Dr Julien Chaisse is Senior Research Fellow at the World Trade Institute in Berne , Switzerland and Visiting Professor at Wuhan University Faculty of Law in China .

F. Robert Buchanan and Syed Tariq Anwar: Resource Nationalism and the Changing Business Model for Global Oil

This paper examines and discusses the area of resource nationalism and its impact on the changing global oil industry.  History reveals that most of the resource-rich countries used resource nationalism to control and nationalize their oil and gas and mining assets.  As of 2009, long-term foreign direct investment (Fdi) contracts that were previously negotiated between international oil companies (Iocs) and host countries continue to be renegotiated, altered, and in some cases cancelled.  In the global oil industry, the major causes of resource nationalism are massive revenues generated in resource-rich countries, particularly as oil prices became exorbitantly high in 2007-2008. The paper looks at the causes and consequences of this debate by applying two practitioner-oriented theories: path dependence theory and real options theory. The work also provides implications of this debate.

F. Robert Buchannan (PhD) is Assistant Professor of Management in the College of Business Administration at University of Central Oklahoma in Edmond , Oklahoma .

Syed Tariq Anwar (Dba) is Professor of Marketing and International Business in the College of Business at West Texas A&M University in Canyon, Texas .

Gu Minkang: When Antidumping becomes Anti ‘Chinese’: New Features of Western Antidumping Actions

China has remained as the most frequent target of the antidumping investigations in the world.  Motivated mainly by political reasons, Western countries have added new features in antidumping actions in order to completely push Chinese exports out of their own markets.  Those new features could be generally summarized into three major aspects, i.e., to take both an antidumping action and an anti-subsidy action against the same exported product, to use facts of subsidy to prove the existence of dumping, and to take a harsher stance on implementing their antidumping law or act.  Regrettably, those new features have never been officially challenged before the Wto Dispute Settlement Body.  Therefore, it is an urgent task to study those new features and to propose new countermeasures accordingly.

 Gu Minkang, LL.B. and Master of Law ( East China University for Political Science and Law, Shanghai , China ), Master of European Business Law ( Aix-Marseilles University , France ), Doctor of Jurisprudence ( Willamette University , USA ) is an Associate Professor and Associate Dean, School of Law , City University of Hong Kong.

Bayo Adaralegbe: Foreign Private Participation in the Electricity Sector of Developing Countries: What Works? An Examination of Nigeria ’s Reformed Electricity Sector

Due to their expertise in the electricity sector and easier access to funding, the expectation is that foreign investors will play a significant role in the reformed electricity sector of developing countries. Private participation in the electricity market is relatively recent considering that it was formerly a vertically integrated monopoly, and participation in developing countries is even more recent.  It is therefore not clear the mechanisms that would address the concerns of foreign investors in these markets. Although foreign investors have for long participated in developing markets, the traditional mechanisms used in dealing with foreign investment risks in the extractive sectors of developing countries would not be adequate in a sector that faces a different set of risks. This article seeks to determine what these mechanisms might be, using Nigeria ’s newly reformed electricity sector as an example.

Bayo Adaralegbe has an LLM in Petroleum Law & Policy (with Distinction) and is completing research leading to the award of a PhD in the area of international investment law at the Cepmlp in Dundee , Scotland . He is admitted to practice law in Nigeria and is a Partner in the law firm of Babalakin & Co. He is also Fellow of the Energy Institute, Fellow of the Chartered Institute of Arbitrators, and Fellow of the Chartered Institute of Secretaries and Administrators.

Yenkong Ngangjoh-Hodu: Sino-African Relationship and its impacts on Africa ’s Regional Integration Processes

In recent years, Africa has emerged as a dominant region in China ’s foreign policy. China has boosted its bilateral trade relationship with Africa and is currently emerging as one of Africa ’s largest trading partners. While dealing with China and other emerging economies, African countries are also struggling to establish strong regional and sub-regional markets. Engaging with China therefore provides opportunities and challenges for African countries’ regional integration processes. Yet, China-Africa relationship is largely on a country-by-country basis rather than regionally. So, what is the nexus between individual country’s agreements with China and deep-rooted integration initiatives needed to construct a functioning custom union or common market in Africa ? In other words, how do the Sino-African trade relations interact with African regional integration processes? And how does the growing Sino-African rapprochement affect trade and investment relations between Africa on the one hand and Europe or United States on the other hand?

Dr. Ngangjoh-Hodu is a Lecturer in law at the University of Manchester School of Law in Manchester , UK .

Jacques Werner: What a Week! A Chairman’s Diary

In the secretive world of international and commercial arbitration, the most secretive part is certainly what goes on within an arbitral tribunal. We have three arbitrators coming from different legal cultural and geographical backgrounds, two of whom will have been appointec by parties having opposing interests. They may have never met before, and each one has his or her own conception of how to behave towards the appointing party and towards colleagues. Yet they have to immediately form a functioning unit, able to dispose of procedural and substantive issues. The present story, aimed at throwing some light on this and other aspects of the arbitral process, is a composite of several actual cases lived by the author as chairman of arbitral tribunals.