Environmental Engineering Reference
In-Depth Information
application of international law in contracts is not beneficial because of the limited
number of laws on regulations in international law. Furthermore, it is doubtful that
ONE would agree to a special provision mentioning that all contractual breaches are
breaches of international law. The other option would be to conclude all contracts
directly with the state of Morocco. In this case, the umbrella clause would lead to
different results. It is unlikely that Morocco is willing to change the existing.
3.5.1.2 The Umbrella Clause
Should an investor conclude a state contract with Morocco, it is unclear whether the
contract claims would be subject to ICSID arbitration, and covered by BIT protec-
tion.
215
The umbrella clause is generally
(
...
) a provision in (
...
) (a BIT) (
...
) that
'
guarantees the observation of obligations assumed by the host state vis-
a-vis the
216
As the term umbrella clause indicates, this provision acts as an
umbrella and extends the application of international law by transferring any
contractual issues into treaty claims.
217
One ICSID tribunal dealt with the issue
of umbrella clauses in depth and stated that there are four different approaches
towards the interpretation of such a clause.
218
The tribunal itself adopted the
approach that
investor.
'
) umbrella clauses may form the basis for treaty claims, without
transforming contractual claims into treaty claims (
(
...
'
219
First of all, there is the disintegrationist approach, mentioning that the BIT is
self-contained and provides a closed list of rights and obligations.
220
Consequently,
some tribunals point out that there is no extension of breaches of BIT due to the
umbrella clause.
221
It is pointed out by one ICSID tribunal that the BIT contracting
party did not express any intention to extend the scope of the BIT.
222
An extension
of treaty claims would be against state sovereignty because of the broad conse-
quences.
223
Furthermore, such an extension of the BIT would lead to a negation
of other investment protection rules.
224
Other tribunals viewed the question
...
).
'
215
Hunter (
2007
), 165 (170); Gallus (
2008
), 157 (158); Dolzer and Schreuer (
2008
), 153; Walter
(
2006
), 815 (816); Hauschka (
2005
), 1550 (1555); Griebel (
2008
), 83; Moses (
2008
), 234-235.
216
Dolzer and Schreuer (
2008
), 153.
217
Griebel (
2008
), 85; Schobener and Markert (
2006
), 65 (90); cf Walter (
2006
), 815 (815).
218
ICSID [2009] ARB/07/12, 56-57 paras 197-200; Also in: Crawford (
2008
), 351 (367-368).
219
ICSID [2009] ARB/07/12, 57 paras 200-201; This view is also called integrationist view and is
not an internationalization of the respective contractual claim, because the tribunal applies the
contractual law to it and not international law, in: Crawford (
2008
), 351 (370).
220
Shany (
2005
), 835 (844).
221
ICSID [2004] ARB/03/11—Award, 20 paras 81-82; ICSID [2003] ARB/01/13, 307 (360-361)
para 161 and (365-366) para 171.
222
ICSID [2003] ARB/01/13, 307 (367) para 173.
223
ICSID [2007] ARB/02/16—Award, 92 para 310; ICSID [2003] ARB/01/13, 307 (363-364)
paras 167-168.
224
ICSID [2003] ARB/01/13, 307 (364) para 168.
