Inter-State Arbitration

Abstract

This chapter explores inter-state arbitration, which is largely influenced by two different traditions, drawn from diplomacy and commerce under public and private international law respectively. The recent history of state–state and also, in part, of investor–state arbitration is the history of the Permanent Court of Arbitration (PCA). As intended by the two Hague Conferences more than a century ago, arbitrations under treaties are still marked by the necessity for the parties’ consent, including a state’s limitation as to the categories of dispute referable to arbitration; a neutral appointing or administering authority; a settled procedure subject to party autonomy; the parties’ involvement in the appointment of the tribunal; and the absence of any appeal from an award for an error of law or fact. For inter-state arbitration and (notwithstanding the ICSID and New York Conventions) investor–state arbitration also, the recognition of the award by the losing party is usually made voluntarily. It is the parties’ arbitration, the award is the product of their consent and, accordingly, the award has a moral binding force for the parties often absent from non-consensual mechanisms.