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The importance of mitigating climate change, upholding good social policies and good governance have led to the rise and use of environmental, social and governance (ESG) factors in the world of finance and investment. Banks, funds and other financial institutions have increasingly sought to measure whether the investments they make promote ESG. This will invariably permeate the world of foreign investment law, as States and claimants become increasingly aware of ESG and ESG-related concerns. This article seeks to consider how the ESG movement has impacted international investment law and arbitration, and how is it likely to do so going forward.

In January 2019, EU Member States issued three declarations concerning the “consequences of Achmea” which stated that all claims under intra- EU BIT S were contrary to the EU legal order, and that tribunals presiding over such claims have no jurisdiction as there is no valid consent to arbitrate. The declaration signed by a majority of EU Member States (“Majority Declaration”) extended this proposition to intra- EU claims under the Energy Charter Treaty. Following this, a number of EU Member States have sought to argue that the Majority Declaration is a subsequent agreement between the States Parties to intra- EU investment treaties—or evidence of a subsequent practice establishing their agreement—that the dispute resolution provisions in those treaties must be interpreted to exclude intra- EU disputes from their scope and thus from the jurisdiction of tribunals constituted thereunder, relying on Article 31(3)(a) and (b) of the Vienna Convention on the Law of Treaties (“VCLT”). This paper considers: (i) the key cases in which the Majority Declaration has been invoked to contest jurisdiction in, or seek the termination of, intra- EU arbitration proceedings; (ii) the application of Article 31(3)(a) and (b) of the VCLT; and (iii) other fundamental tenets and rules of international law discussed in relation to those cases.

Economic growth in Asia has been accompanied by an increase in sophistication regarding dispute resolution processes. Arbitration continues to flourish, as is evidenced by the growth of arbitral institutions across the region. One challenge arbitration faces is the abuse of the due process protection afforded under the New York Convention and the UNCITRAL Model Law. During proceedings, parties may capitalise on arbitrators’ fear of an eventual challenge to seek to admit new evidence or to create more opportunities to present their case – resulting in an inefficient and protracted timeline. Post-award, losing parties may comb through the record in search of “evidence” that the arbitrators did not give them an opportunity to present their case. Despite the recent surge of concern in this area, jurisprudence from two Asian seats, Hong Kong and Singapore, suggests that the bar for such challenges has been set high. There also appears to have emerged from the case law a broad set of criteria which should guide courts when reviewing due process challenges. Interestingly, even though few of the Hong Kong and Singapore cases expressly refer to jurisprudence from other jurisdictions, they appear to be applying identical, universal, standards. This is encouraging for arbitration in Asia and for commercial parties that crave legal certainty and wish for finality in the arbitration process.

States and state entities are increasingly involved in commercial arbitration. Despite the fairly settled principles concerning state immunity from adjudication and state immunity from execution, the principles concerning state immunity from interim relief by domestic courts in aid of arbitration remains poorly defined. Adopting Professor McLachlan’s approach toward foreign relations law, this article attempts to sketch the principles which may govern state immunity in the context of interim relief against states in aid of arbitration by applying the rules of state immunity in an allocative manner. It is suggested that it is at least arguable that a state’s consent to arbitration in many cases could amount to a waiver of state immunity from court-aided interim relief by the court located at the seat of the arbitration. This conclusion is likely to strike a balance between over-deference to states by virtue of their sovereign status, and a liberal erosion of the immunity rules in favour of private counterparties.