Enabling Private Ordering - the University of Minnesota Law School

52 MINNESOTA JOURNAL OF INT’L LAW [Vol. 18:1
settlement bodies found a rule of international law that
prevented States from bridging the difference between contract
claims and treaty claims by granting diplomatic protection and
submitting contract claims to international dispute settlement.
Much to the contrary, the case law confirms that international
law did not prevent States from espousing claims of their
nationals against the host State, even in a case where the
alleged breach only concerned a violation of national law. In
addition, the pertinent decisions do not reflect a presumption
against litigating breaches of municipal law in inter-State
proceedings as long as the jurisdictional basis can be reasonably
interpreted as covering claims for the breach of municipal law or
commercial breaches of investor-State contracts. This case law
and the underlying State practice therefore call into question
the restrictive approach to interpreting umbrella clauses that
elevates the contract claim/treaty claim distinction into a
doctrine of international law that could not be undone by
international treaties.
2. Broadly Worded Arbitration Clauses in Investment Treaties
That the national/international law divide is not as strict as
suggested by those who support a restrictive interpretation of
umbrella clauses can also be seen in broadly worded arbitration
clauses under many investment treaties that enable investors to
bring “any dispute relating to investments.” 140 Arbitral tribunals
have interpreted such clauses as allowing foreign investors to
bring claims based on the violation of investor-State contracts
without alleging any separate violation of the investment treaty
in question, such as fair and equitable treatment or indirect
expropriation.
The Tribunals in Salini v. Morocco 141 and Consortium RFCC
v. Morocco, 142 for example, had to consider the scope of Art. 8 of
139. For a discussion of broad arbitration clauses, see Jörn Griebel, Jurisdiction
over “Contract Claims” in Treaty-Based Investment Arbitration on the Basis of Wide
Dispute Settlement Clauses in Investment Agreements, 4 TRANSNAT’L DISP. MGMT.
(Sept. 2007); Jörn Griebel, Die Einbeziehung von “contract claims” in internationale
Investitionsstreitigkeiten über Streitbeilegungsklauseln in
Investitionsschutzabkommen, 4 ZEITSCHRIFT FÜR SCHIEDSVERFAHREN
[SCHIEDSVZ]/GERMAN ARB. J. 306 (2006). See also Gaffney & Loftis, supra note 4, at
13–15.
141. Salini Costruttori S.p.A. and Italstrade S.p.A. v. Kingdom of Morocco,
ICSID (W. Bank) Case No. ARB/00/4, Decision on Jurisdiction (July 23, 2001).
142. Consortium RFCC v. Morocco, ICSID (W. Bank) Case No. ARB/00/6,