Research On The Appellate Mechanism Of The European Investment Court System

The European Investment Court System(ICS)is a new dispute resolution model proposed and led by the EU for the settlement of investment disputes between foreign investors and host states.The model establishes a permanent investment tribunal with an appellate tribunal,which is closer to the domestic judicial system of a state.The establishment of an appellate tribunal for international investment disputes has been discussed and debated by scholars,and the ICS is the latest practice in this field.Analyzing the latest practice,this thesis expects to find out whether the new model can solve the problems of the existing investment dispute settlement mechanisms and to find out the new challenges imposed by it,with a view to providing suggestions for the design of rules for dispute settlement mechanisms in the China-EU investment agreement and other future multilateral agreements.The first chapter of the thesis analyzes the background of the ICS and introduces the process of its establishment.The reason for the establishment of the EU investment tribunal lies in the misalignment of the existing international investment dispute settlement mechanism and the deficiencies of its specific rules.In terms of its establishment process,the ICS provisions have been included into four international treaties between EU and Canada,Singapore,Vietnam and Mexico respectively.The second chapter sets out the specific rule-designing of the ICS.Different from the traditional model,under the ICS,the members of the appeal tribunal are selected by the Contracting States(the future Respondents in investment disputes)based on the criteria set out in the treaties.In terms of jurisdiction,the ICS Appeal Tribunal has a broader jurisdiction than its WTO counterpart,which includes both factual and legal issues.However,from the Decision made by CETA Committee,both EU and Canada have realized that an overly broad jurisdiction would jeopardize the designed function of the appeal tribunal.Thus,the Decision intends to limited the jurisdiction of the appeal tribunal regarding its handling of factual issues.The third chapter focuses on whether the current ICS arrangements can solve the problems of lack of neutrality and impartiality of arbitrators and inconsistent arbitration awards in the traditional ICSID model.In general,the current ICS provisions can address these problems to a certain extent.A more judicialized selection of adjudicators,a longer term of office of such adjudicators and a higher requirement of code of conduct can improve the neutrality of adjudicators.Additionally,having an appeal rounds and forming a stable composition of the appellate body can partially solve the problem of inconsistent decisions.The final chapter firstly analyzes the new problems and challenges brought by ICS in parallel with its institutional innovation.For example,ICS has designed its rules with more emphasis on the protection of the host state’s right to regulate,which may make the ICS has a systematic bias in favor of the host state.In addition,the current EU investment tribunals are only included in bilateral investment agreements and have not yet produced effective multilateral agreement texts.It is not known whether ICSs established under different agreement texts can agree on the same or similar legal issues.Combined with the aforementioned analysis this thesis argues that,based on the EU’s insistence on the incorporation of the ICS,China should seize the transitional arrangement set by the CAI between EU and China and aim to work out an appeal mechanism arrangement that meets the interests of China and Chinese investors.At the multilateral level,Working Group III of the United Nations Commission on International Trade Law is also promoting the reform of the international investment dispute settlement mechanism.China should grab the opportunity of this reform as well,actively participate in the international investment dispute reform process,and promoting the construction of a balanced appeal mechanism of the international investment dispute settlement.