Chapter 1
Bribery and Other Serious Investor Misconduct in Asian International Arbitration
Nobumichi Teramura, Luke Nottage and Bruno Jetin
Abstract: Bribery and other serious illegal behaviour by foreign investors face wide condemnation in any
society. Yet there remains a lack of consensus on the consequences of corruption and illegality affecting
international investment, and especially in investment arbitration – a transnational procedure to resolve
disputes between a foreign investor and a host state. A core issue is whether a foreign investor violating a hoststate's law should be awarded protection of its investment, as per its contract with the host state and/or theapplicable investment or trade agreement between the home state and the host state. Some suggest suchprotection would be unnecessary, as the investor committed a crime in the host state, while others attempt toestablish an equilibrium between the investor and the host state. Some others claim to protect investment,
invoking the sanctity of promises made. This book explores Asian approaches towards the issue, setting it in thewider political economy and domestic law contexts. It also considers the extent to which significant states in
Asia are or could become “rule makers” rather than “rule takers” regarding corruption and serious illegality
in investor-state arbitration.
1.1. Introduction
Almost everyone regards corruption and bribery as an international evil, and encourages global society toeradicate such illegal activities.1 Various international initiatives against corruption have gained international
support. Very important is the United Nations Convention against Corruption (UNCAC) (2003), which has 189
member states and is the only universal legally binding anti-corruption instrument. 2 Another influential
international legal instrument is the OECD Convention on Combating Bribery of Foreign Public Officials inInternational Business Transactions (‘OECD Convention’) (1997). This is ‘the first and only international anticorruption instrument focused on the “supply side” of the bribery transaction – the person or entity offering,promising or giving a bribe’, 3 requiring member states to criminalise such activity even abroad under theirown domestic laws. Forty-four signatories – all 37 OECD developed economies, plus Argentina, Brazil,

Kofi Annan, past Secretary General of the United Nations, described corruption as an insidious plague that
‘undermines democracy and the rule of law, leads to violations of human rights, distorts markets, erodes the quality oflife and allows organized crime, terrorism and other threats to human security to flourish’: Annan 2004. See also Pavić
2012, p. 663; Wetter 1994, p. 294; Glencore International AG v Republic of Colombia, Award, ICSID Case No
ARB/16/6, 27 August 2019 [663] (Glencore case).
2
UNODC n.d.-b.
3OECD n.d.-b11Bulgaria, Costa Rica, Peru, Russia and South Africa – have adopted this convention.4 Both treaties reflect thenormative global consensus against corruption and bribery, 5 and Asian states certainly form part of theconsensus.6
Nevertheless, enforcement of these treaties and related national laws remains problematic,7 and corruption andpoor governance remain serious problems world-wide, including in many Asian jurisdictions. For example, themajority of East (North and Southeast) and South Asian states and jurisdictions performed poorly inTransparency International’s 2021 Corruption Perceptions Index, which scored and ranked 180 countries andterritories based on their perceived levels of public sector corruption based on responses from experts andbusinesspeople. As demonstrated in Table 1.1 below, Singapore, Hong Kong, Japan, Bhutan and Taiwan are
ranked in the top 30 least corrupt countries and territories, but 12 among 22 East and South Asian jurisdictions
sank below the top 90.
Table 1.1: 2021 Corruption Perceptions Index for East and South Asia (Best to Worst)8Country/

Singapore

Territory
Global

Hong

Japan

BhutanTaiwan

Kong

South

Malaysia

China

India

Korea

4/180

12/18018/18025/18025/18032/18062/18066/18085/180Maldives

Indonesia

Sri Lanka

Mongolia

ThailandPhilippines

Nepal

Papua New

Laos

Rank
Country/
Territory
GlobalGuinea85/18096/180102/180

110/180

MyanmarBangladesh

CambodiaNorth

110/180

117/180

117/180

124/180

128/180

Rank
Country/
Territory
GlobalKorea
140/180

147/180

157/180

174/180

Rank

OECD n.d.-b In addition, there are regional conventions fighting against corruption, such as the 1996 Inter-American
Convention Against Corruption, the 1999 Council of Europe Criminal Law Convention on Corruption and the 1999
Council of Europe Civil Law Convention on Corruption.
5
Gaillard 2019, p. 14. These conventions offer various definitions on corruption because there is no universal definitionof corruption (Baizeau 2015, p. 9). However, corruption normally refers to ‘the deliberate abuse of authority or trust to
benefit a private interest’ including ‘“bribery” (ie, giving or offering something to someone as a reward for doing
something), “embezzlement” (ie, improperly taking control of assets to which one has access) and “fraud” (ie,false representations by statements or conduct to gain a material advantage) (Banifatemi 2015, p. 16).
6
The only Asian state that has not signed or ratified the UNCAC is the Democratic People’s Republic of Korea (North
Korea): UNODC n.d.-a. In contrast, only Japan and South Korea have adopted the OECD Convention in Asia.
7
See eg Joutsen 2011; Davids and Schubert 2011; Arnone and Borlini 2014; OECD n.d.-a; Pieth 2020. However,enforcement of these treaties targeting corruption can sometimes be strong, eg even just for temporary domestic electoral
advantage: see eg Cohen and Li 2021. The treaties also create a “harder law” regime compared to say more recent initiatives
in many parts of the world to address modern slavery in corporate supply chains: see eg Harris and Nolan 2021.
8
https://www.transparency.org/en/cpi/2021
42Moreover, the World Justice Project (WJP) Rule of Law Index 2021 measured ‘the rule of law in 139 countries
and jurisdictions by providing scores and rankings based on eight factors: Constraints on Government Powers,
Absence of Corruption, Open Government, Fundamental Rights, Order and Security, Regulatory Enforcement,
Civil Justice, and Criminal Justice’.9 In this ranking again, the results of assessment on 17 East and South Asian
countries and territories are not outstanding. None of them were in the top 10 countries with strong rule of law,and 10 out of the 17 jurisdictions ranked in the bottom half, as shown in Table 1.2. The COVID-19 pandemic
reportedly exacerbated corruption in Asia because the Asian governments rolled out huge economic recovery
plans, without providing adequate checks and balances.10
Table 1.2: WJP Rule of Law Index (2021) for East and South Asia (Best to Worst)11
Country/Japan

Singapore

Territory
Global

Hong

South

Kong

Korea

Malaysia

Mongolia

Indonesia

Nepal

Sri Lanka

76/13915/13917/13919/13920/13954/13961/13966/13970/139India

Thailand

Vietnam

China

Philippines

Bangladesh

MyanmarCambodia

79/13980/13988/13998/139102/139

124/139

128/139

138/139

Rank
Country/
Territory
GlobalRank

This reality in many parts of Asia as well as worldwide encourages some foreign investors, even from OECD
Convention members states, to pay bribes or engage in other illegal behaviour often with the explicit or implicit
support of host state officials and/or local investment partners. This issue is particularly important as the flows
and stocks of foreign investment have increased significantly in and out of the Asian region, particularly sincethe 1980s and including recently to a growing extent among Asian economies12 as shown in Figure 1.1 below.

WJP 2021, p. 9 (emphasis added).
International 2022.
11
https://worldjusticeproject.org/rule-of-law-index/global
12
UNCTAD 2021. The major outbound investors in the region are Japan, China and South Korea, but this book mostly
focuses on inbound FDI flows into East and South Asia as this closely links to the domestic issues of corruption andillegality in the host states.
9

10

3

Figure 1.1: Inflows of Foreign Direct Investment in Asia, 1990-202013

Inflows of Foreign Direct Investment in Asia, 1990-2020

US$ at current prices in billions

2,500

2,000

1,500

1,000

500

1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020

0

World

Asia

East Asia

Southeast Asia

South Asia

FDI started to surge in the 1990s when the deregulation of world markets and the decline of protectionism
initiated hyper-globalisation.14. Figure 1 shows that, at the world level, FDI has embraced the global economy,
accelerating sharply during the periods of growth and collapse after the dotcom crisis of 2001 and the financial
crisis of 2008-2009. A peak was reached at USD 2 trillion in 2016, fuelled by a flurry of megadeals in crossborder mergers and acquisitions in high-income countries.15 The decline in the subsequent years (2017-2019)was driven by a decrease in the average profit rate on foreign investment, escalation and broadening of trade
conflicts, a fall in greenfield investments and large-scale repatriation of accumulated foreign earnings following
tax reforms in the USA.16 Excluding one-off factors, FDI growth averaged 1% per year after the global financial
crisis (2009-2018) compared with 8% over the period of 2000 to 2007.17 This evolution has fuelled the debate
concerning the entry into a period of deglobalisation.18 In this gloomy context for foreign investment, the shockof the COVID-19 pandemic occurred. The fall in 2020 brought global FDI back to $1 trillion, an amountequivalent to the sum in 2005 and around 20% lower than the trough after the global financial crisis of 2009.

Source: Jetin’s computation with UNCTAD data.
Carroll et al. 2020; Subramanian and Kessler 2013.
15
UNCTAD 2018.
16
UNCTAD 2019.
17
UNCTAD 2019.
18
Antràs 2020.
13
14

4

In comparison, FDI inflows in Asia have grown steadily since the 1990s, registering only a modest drop in 2009.
They maintained their growth after 2016 and even during the COVID-19 pandemic in 2020 when FDI was
plummeting globally. This is mainly explained by the resilience of East Asian economies. In particular, China
recovered in March 2020 from the COVID and removed the nationwide lockdown long before the rest of theworld. Southeast Asia recovered lately and was strongly hit by the paralysis of international trade as it relies
more on FDI related to global value chains, while in the Chinese case, FDI is more attracted by the vastpotentialities of its internal market.19 Consequently, FDI in Southeast Asia was down 25% in 2020 compared
to 2019. FDI in South Asia remains around two times and four times less than in Southeast and East Asia,
respectively. This is because India’s economy is around five times smaller than China’s and because South Asia
remains fragmented by geopolitical conflicts that hinder deeper regional integration. As a result, India does not
attract as much FDI as China and is not the hub of regional value chains that assemble intermediate products
imported from neighbouring countries. However, FDI in South Asia proved resilient during the pandemic andgrew by 20% in 2020 compared to 2019. Overall, FDI in Asia has increased firmly despite the global economic
decline, reaching 51% of the world total in 2020, up from 32% in 2019. East Asia attracted 30.2%, Southeast
Asia 13.6% and South Asia 7.1% of global FDI inflows. This is a new indication of the shift towards Asia in
the accumulation of world capital.
Nonetheless, discussion has been limited and fragmented about the extent to which foreign investments
allegedly tainted by corruption or other serious illegality are likely to be protected through arbitration in thecontext of international investment disputes. Such disputes can be resolved by international arbitration under
two main routes. The first involves individually negotiated investment contracts between a foreign investment
and a host state entity (and sometimes a local investment partner). These contracts typically include anarbitration clause, requiring disputes to be resolved by an expert international tribunal of chosen arbitrators, ata chosen neutral seat.20 Also, the parties usually expressly agree on applicable rules to be followed with thetribunal, such as the ad hoc United Nations Commission on International Trade Law (UNCITRAL) Arbitration
Rules, or institutional arbitrations rules such as those of the International Chamber of Commerce (ICC). The
underlying investment contracts are typically expressed to be governed by an agreed national contract law, orsometimes the “lex mercatoria” or “general principles of law” (such as the UNDROIT Principles of International

UNCTAD 2022.
However, undermining neutrality somewhat, some government entities (eg in Thailand) have laws or policies requiringthem for at least some types of public contracts to insist on arbitration seated in and therefore subject to supervision by the
courts in their own jurisdiction: see eg Nottage and Thanitcul 2017, with a longer version athttps://papers.ssrn.com/sol3/papers.cfm?abstract_id=2770889.
19
20

5

Commercial Contracts). 21 The resultant awards are enforceable typically through the 1958 New York
Convention on the Recognition and Enforcement of Foreign Arbitral Awards (NYC) now ratified by around 169
states, 22 like most purely commercial arbitral awards rendered by a foreign-seated tribunal nowadays, or
through seat courts applying increasingly (especially across Asia) arbitration legislation based on the templateof the UNCITRAL Model Law on International Commercial Arbitration (the Model Law).23 Both the Model
Law and the NYC permit only limited grounds to refuse enforcement of awards; but one is “public policy” ofthe state enforcing the award, which – even if interpreted in an internationalist spirit – can make it difficult to
enforce an award against a government entity.24
A variant, that may provide better scope to enforce awards, is for the parties to the investment contract to consent
to resolve disputes through arbitration administered by the International Centre for the Settlement of Investment
Disputes (ICSID, headquartered in Washington DC and affiliated with the World Bank). If the host state is
further party to the 1965 Washington Convention on the Settlement of Investment Disputes between States andNationals of Other States (the ICSID Convention), with 156 member states,25 it can consent to arbitration under
ICSID Arbitration Rules. If the home state of the foreign investor is also party to the ICSID Convention,
resultant awards can then only be challenged by an ad hoc annulment committee of separate arbitrators, as there
is no “seat” and related court, and the grounds for setting aside the awards (to prevent enforcement) are evennarrower by not including “public policy” of any state. 26 Further, such ICSID Convention awards can be
enforced against assets of the losing host state in any Convention member state, as if they were the final
judgment of that state’s court system,27 thus preventing any further review there for “public policy” or other
NYC-like grounds for refusing enforcement.28
The second main route for foreign investors to resolve international investment disputes with governments isthrough consent to arbitration through a standalone investment treaty, or (more common recently) an investment
chapter within a free trade agreement (FTA). Through such treaties, the host state promises to the home statethat it will provide agreed substantive protections to the home state’s investor, to encourage and protect foreign
For a recent example where an arbitral tribunal applied these Principles (even though not originally expressly chosen to
apply to a lease agreement) to award nearly $US15 billion to eight Filipino individuals (heirs to the last Sultan of Sulu)
against Malaysia (successor to the British North Borneo Company), see Charlotin 2022.
22
See UNCITRAL n.d.-a
23
See UNCITRAL n.d.-b; and generally eg Bell 2018.
24
Article V of the NYC and Article 36 of the Model Law. The state may also have taken the NYC reservation, or adapted
the Model Law template, to allow only enforcement of “commercial” awards and then explicitly or implicitly excluded
awards from arbitration agreements involving government entities. See generally eg Bermann 2017.
25
See ICSID 2022b.
26
Article 52 of the ICSID Convention.
27
Article 54 of the ICSID Convention.
28
If the host state but not the home state has not ratified the ICSID Convention, it can still consent to allowing the foreign
investor to commence arbitration administered by ICSID, but those will proceed under different ICSID Rules, and resultant
awards will be enforced typically via the NYC rather than the ICSID Convention enforcement regime.
21

6

investment. The host state also makes these commitments more credible by agreeing to have an international
arbitral tribunal hear and give awards regarding alleged violations, if and when the foreign investor commencessuch investment treaty arbitration. The consent provided in the treaty generally allows for ad hoc UNCITRAL
arbitration (which have been applied therefore in about a third of all known claims) or institutional arbitration
through ICSID (about two thirds of claims), with very few treaties and therefore claims being filed under otherinternational arbitration centre rules (such as ICC Rules).29
Such investment treaty arbitration is typically referred to as investor-state dispute settlement (ISDS), especiallyin the media which has become increasingly concerned about this dispute resolution process and outcomes,
including recently in parts of Asia.30 However, ISDS can also be broadly interpreted as encompassing dispute
resolution under investment contracts including arbitration clauses (especially where the host state is party to
the ICSID Convention and consents to its type of administered arbitration), 31 as well as investor-state
conciliation or mediation rather than arbitration (so far rare, but of growing interest including via investment
treaty provisions). 32 In this chapter and volume, we refer to this route of consent to arbitration throughinvestment treaties as “treaty-based ISDS”. Known cases have become increasingly common world-wide(reaching over 1100 filings as of 23 March 2022)33 as foreign investment flows have burgeoned – especiallyfor foreign direct investment (FDI) involving investors taking larger and more controlling stakes – inconjunction with more investment treaties (over 3300 signed34) that increasingly provide for ISDS as well asinter-state arbitration processes, especially since the 1990s. The proportions of East and South Asian cases werequite low until around 2010, compared to other regions and the stocks of FDI, arguably perhaps due to various“institutional barriers” to commencing or defending claims (such as a relatively paucity of arbitrators andcounsel in the region).35 However, the proportions and absolute numbers have been increasing significantly
over the last decade.36
Such treaty-based ISDS arbitration cases tend to attract more attention because they have wider implications
than disputes involving contract-based consents to arbitration from government entities, as the latter typicallySee UNCTAD n.d.-b. Out of 1104 treaty-based ISDS claims recorded as of 20 December 2020, for example, 352 weread hoc arbitrations under the UNCITRAL Rules. The reason for very few treaty claims being referred to arbitration centres
might be that their leaders were involved in corruption allegations in the past, as discussed in Sim 2019 on the AsianInternational Arbitration Centre.
30
See eg Nottage 2021a; Nottage 2022.
31
There have been 146 cases filed with ICSID under consents to arbitration in individual contracts, according to ICSID
2022a. Of these, 133 involved ICSID Convention Arbitration Rules.
32
Ubilava 2022; Claxton 2020.
33
There had been 1104 known filings, according to UNCTAD n.d.-c.
34
There had been 2805 BITs signed (2242 in force) and 424 signings of other investment agreements such as FTAs (331
in force), according to UNCTAD n.d.-a.
35
Nottage and Weeramantry 2012; Nottage and Weeramantry 2011; Kim 2012.
36
See eg Chaisse and Nottage 2018.
29

7

only have implications for the relevant individual investor(s) and can depend on the wording of the investment
contract terms. By contrast, tribunals in treaty-based ISDS arbitrations must interpret and apply still often more
broadly drafted substantive protections offered by host states to all foreign investors of the home state underpublic international law. An award favouring one investor under such a treaty-based ISDS claim, because of ahost state measure found by the investor to violate its substantive treaty commitments, could lead to similar
claims by other investors from the same host state also adversely affected by this violation – or even by similarly
affected investors from other states under different treaties but with similarly worded protections against suchmeasures.37
1.2. Investor-State Dispute on Corruption in Investment Arbitration
The core problem of interest in this volume, arising under both main routes for resolving investor-state disputes
through arbitration, can be explained as follows. A foreign investor, even if having had staff found actually or
possibly to have engaged in some bribery, may well expect complete or at least some protection for its
investment, pursuant to its contract with a host state and/or applicable investment treaties such as an FTA,
Bilateral Investment Treaty (BIT) or Multilateral Investment Treaty (MIT). At least, it will attempt to make sucha claim against the host country before an independent tribunal established by an investment treaty or, lessfrequently nowadays, through an arbitration agreement included in any investment contract with the host state.38
The investor will not favour litigation in the host state, as it perceives the domestic legal system to be biased
and partial,39 and it anyway feels that the host state should respect what it has agreed to provide in investment
treaties and/or contracts. Indeed, typical investment treaties afford foreign investors protection fromexpropriation, fair and equitable treatment, 40 national treatment, most-favoured-nation treatment, full
protection and security, and dispute resolution by a neutral third party (especially arbitration).41 Accordingly,
the investor might well feel entitled to assert those rights in front of an independent tribunal.
The host state will react negatively, however, usually relying on illegality provisions expressly or impliedly
included in investment agreements. Many BITs and FTAs require foreign investments to be made in accordanceThis explains, for example, large numbers of claims brought by investors from various home states under quite similarly
worded BITs concerning quite similar measures introduced by Argentina to address an economic crisis in the 1990s, orunder treaties and the Energy Charter Treaty against Spain after it significantly changed its renewable energy legislation,or against India over various measures after an adverse 2011 award. See Singh 2021; Alvarez and Topalian 2012; Park andSamples 2017 (focusing on the subset of bond claims after the crisis); on Spain / renewable energy policy change ISDS
claims see García-Castrillón 2016; García-Castrillón 2017; Schmidl 2021; Ballantyne 2021 (introducing a Japanese
investor’s successful ICSID claims against the Spanish government over solar reforms).
38
Walter 2015, pp. 85, 90ff.
39
Besch 2015, pp. 140-141.
40
Of 2,538 BITs signed between 1959 and 2016, 2,418 (95%) have a fair and equitable treatment clause: UNCTAD n.d.d41
Hobe 2015, p. 13; Meshel 2013, pp. 270-271.
37

8

with or in conformity with domestic laws of the host state,42 which normally criminalise corrupt practices suchas bribery.43 The host state may find this legality requirement useful to assert the non-availability of investment
protection for the corrupting investor, invoking the violation of the treaty provision from the investor’s side. In
other words, the state may reject affording protection to investment tainted by corruption or other such seriously
illegal conduct. Indeed, the corruption defence has often led arbitral tribunals to dismiss investors’ claims forinvestment protection because tribunals tend not to provide foreign investors with such rights if they find thatthe investment has been made through illegal conduct.44
The dilemma then is that the investor may feel that this defence is too favourable towards the host state. For
example, even if the host state clearly misbehaves, say by expropriating the investment without compensation
or by breaching other substantive commitments promised under the investment treaty, the investor loses accessto an independent dispute resolution forum. The host state might go even further, giving the investor the
impression that it is common to give the public official an informal payment in the form of donations or
consulting agreements. As soon as the payment is made or alleged, the investor loses protection over theinvestment. In other words, it is not impossible for the state to abuse the corruption defence, for it obtains boththe investment and the bribe, while the investor loses the investment and a neutral forum to recover its loss. The
problem is particularly acute in developing economies because ISDS-backed protections are arguably useful toencourage foreign investment into jurisdictions with weak rule of law, governance and political systems.45 Thevery type of jurisdictions likely still to be struggling with problems of corruption and lack of transparency inpublic affairs, hence, nonetheless likely to be hit by ISDS claims at least in the shorter term.46 Over the longer
term, appropriately commenced and resolved ISDS arbitration claims might also lead to improvements intransparency, good governance and the rule of law particularly in developing economies.47
Accordingly, the tribunal needs to consider how to strike a balance between the investor and the host state inhandling corruption allegations. However, ISDS tribunals have not yet settled this issue. The lack of their
discussion and consensus on the issue was recently criticised by the Expert Group Meeting on Corruption and

For example, of 2,538 BITs signed between 1959 and 2016, 66% contain an ‘in accordance with host State law’clause: UNCTAD n.d.-d43
Obersteiner 2014, p. 276; Tamada 2015, p. 107.
44
See generally Banifatemi 2015.
45
Discussing the empirical evidence on the impact of ISDS-backed provisions on FDI flows, see eg Singh 2021;
Armstrong 2018; Nottage 2021b; Armstrong and Nottage 2022.
46
Dupont et al. 2022, p. 367 (suggesting that ‘poor governance, understood as corruption and lack of rule of law, has astatistically significant relation with investment arbitration claims’).
47
However, significant net positive effects on local legal and political institutions from ISDS claims may need to beaccompanied by specific law reforms, like enactment of broader arbitration legislation following global standards, assuggested recently eg by Rogers and Drahozal 2022.
429

International Investments, co-organised by the United Nations Office on Drugs and Crime (UNODC) and theUnited Nations Conference on Trade and Development (UNCTAD) in 2021, as follows:
Despite a growing number of investor-state disputes involving corruption allegations, arbitral tribunals often do
not address the issue and the limited number of awards that did deal with corruption allegations lack consistency.
Arbitrators generally appear hesitant to address corruption allegations, and when they do their approaches seem
ambiguous and inconsistent. Coherent standards must be in place to ensure that corruption allegations based on
credible sources are appropriately addressed based on international public policy ...48

This critique appears to be fair: arbitral tribunals’ approaches towards corruption and illegality are indeed
fragmented, despite quite a few arbitral awards addressing the issues, as demonstrated in the following section.
1.3. Arbitral Tribunals’ Approaches to Deal with Corruption
Arbitral tribunals have dealt with the issue of corruption in various ways. Several academic commentators haveidentified three broad approaches: (1) the ‘zero tolerance’ approach; (2) the ‘closer look’ approach; and (3) the‘it depends’ approach. 49 Those approaches have evolved by absorbing debates about other serious illegal
behaviour by foreign investors such as forgery and fraud, occasionally but insufficiently in the context of Asia.
1.3.1.

The ‘Zero Tolerance’ Approach

The ‘zero tolerance’ approach does not admit the tribunal’s jurisdiction over any corruption cases. It suggests
either dismissing any claims arising out of contracts procured through corruption or concluded for paying bribes,
or conferring no protection to investments made through corruption.50 The origin of the former justification canbe found in the award of Judge Lagergren in ICC Case No. 1110 (1963), which concerned acommission/consultancy agreement to bribe Argentinian government officials.51 Judge Lagergren highlighted
the existence of an international public policy against corruption and held that ‘in concluding that I have nojurisdiction, guidance has been sought from general principles denying arbitrators to entertain disputes of thisnature …. Parties who ally themselves in an enterprise of the present nature must realize that they have forfeited
any right to ask for assistance of … arbitral tribunals … in settling their disputes’.52 Several investment arbitral

UNODC 2021, p. 6.
Wilske and Obel 2013, pp. 181-186; Tamada 2015, pp. 115ff;; Raouf 2009 (introducing the ‘zero tolerance’ approachand the ‘eyes shut’ approach in which arbitrators rely on weak procedural grounds to avoid inquiry into matters strongly
indicating the existence of corruption); Schefer 2021, pp. 892-902 (introducing the three types of the illegality defence on
corruption along the lines of the three approaches).
50
Greenwald and Ivers 2018, pp. 56-72.
51
Wetter 1994.
52
Wetter 1994, p. 294.
48
49

10

tribunals have followed suit, holding that such intermediatory contracts contemplating bribery are void(able)
and therefore should not give rise to valid claims.53
Some other tribunals have rejected hearing arguments on investments “tainted by corruption”, refusing to protect
investments that violate an investment treaty clause that the foreign investment shall be ‘in accordance with thedomestic law of the host state’ clause. This type of clause has also been applied to decline jurisdiction for otherserious investor misconduct. In a quite early Asia-related claim under a BIT with Germany, the tribunal in
Fraport AG Frankfurt Airport Services Worldwide v the Republic of the Philippines (I) [2007]54 (Fraport (I)case) adopted this option. Disputes arose from the claimant’s investment into a Filipino company joining a
concession contract for the construction and operation of Ninoy Aquino International Airport Passenger
Terminal III. After the Philippine Supreme Court ruled that the concession contract was null and void, theclaimant commenced a BIT claim against the Philippines under ICSID Convention Arbitration Rules.. However,
the tribunal considered that the claimant ‘was consistently aware that the way it was structuring its investmentin the Philippines was in violation of the [Anti-Dummy Law] and accordingly sought to keep those arrangements
secret … [and that] it proceeded with the investment by secretly [and knowingly] violating Philippine law
through the secret shareholder agreements’.55 The tribunal concluded that it lacked jurisdiction over the case as
the claimant did not make an investment ‘in accordance with law’ under the applicable BIT.56 Thus, the tribunal
used the legality clause to exclude unlawfully established investments from the scope of the BIT protection andto deny its jurisdiction ratione materiae.57
Some arbitral tribunals have gone even further, holding that no explicit legality clause is required for them todismiss claims for the protection of illegal investments because investment treaties in general and the ICSID
Convention implicitly require investments’ compliance with the host states’ laws.58 However, this view is quite

Greenwald and Ivers 2018, pp. 56ff; Llamzon 2015, pp. 32-33. For example, in World Duty Free Co. Ltd. v The
Republic of Kenya, ICSID Case No. ARB/00/7, Award dated Oct. 4, 2006 (World Duty Free case), the tribunal concluded
that ‘bribery is contrary to the international public policy of most, if not all, States or, to use another formula, totransnational public policy, [and therefore] claims based on contracts of corruption or on contracts obtained by corruption
cannot be upheld by this Arbitral Tribunal” (para. 157). Also, see Niko Resources (Bangladesh) Ltd. v People’s Republicof Bangladesh, Bangladesh Petroleum Exploration & Production Company Limited, and Bangladesh Oil Gas andMineral Corporation, ICSID Cases Nos. ARB/10/11 and ARB/10/18, Decision on Jurisdiction dated Aug. 19, 2013 (Nikocase).
54
ICSID Case No. ARB/03/25, Award dated 16 August 2007.
55
Fraport (I) case, pp. 159 and 170.
56
Ibid, p. 194.
57
See also Metal-Tech Ltd. v. The Republic of Uzbekistan, ICSID Case No. ARB/10/3, Award dated Oct. 4, 2013 (MetalTech case).
58
Greenwald and Ivers 2018, pp. 67ff; Polkinghorne and Volkmer 2017, pp. 155-158; Phoenix Action, Ltd. v. The Czech
Republic, ICSID Case No. ARB/06/5, Award dated Apr. 15, 2009; SAUR International S.A. v. Republic of Argentina,
ICSID Case No. ARB/04/4, Decision on Jurisdiction and Liability dated June 6, 2012 (translation); Khan Resources Inc.,
Khan Resources B.V. and CAUC Holding Company Ltd. v. Government of Mongolia, UNCITRAL, Decision on
Jurisdiction dated 25 July 2012 (Khan Resources case); Fraport AG Frankfurt Airport Services Worldwide v. Republic of
53

11

controversial because its legal basis is unclear, and arbitral tribunals adopted different rationales without
uniformity.59 Several commentators and arbitrators further criticise the view, suggesting that contracting parties(ie, states) do not consent to limit the jurisdiction of a tribunal without an express agreement.60 They claim thatdenouncing its jurisdiction based on allegedly implied legality clause would risk the tribunal to exceed its
jurisdiction and would thereby cause the resulting award to be challenged under Article 52 of the ICSID
Convention.61 Accordingly, the lack of legality clause or the lack of explicit jurisdictional hurdle ‘cannot be
overcome by resorting to general principles of law or considerations of object and purpose’.62 Therefore, the‘zero-tolerance’ approach would only become reasonable where a tribunal relied on an explicit legality clausein an investment treaty or agreement.
According to Tamada, the ‘zero-tolerance’ approach may slightly re-balance the interests between the investor
and host state in the current framework of investor-state dispute settlement, which is (arguably)disproportionately pro-investor. 63 (Since that view was expressed, however, UNCITRAL and ICSID haveengaged in widespread consultation to identify whether and more specifically how treaty-based ISDS could be
too pro-investor, and therefore what more targeted mechanisms might be promoted to address any such
imbalances. 64 ) Other commentators claim that this strict approach may anyway advance anti-corruption
objectives.65 In short, the zero-tolerance approach is the most rigorous, among the three approaches against
corruption in investor-state arbitration.
1.3.2.

The ‘Closer Look’ Approach

The ‘closer look’ approach finds that the tribunal has jurisdiction but can reject claims on the grounds ofcorruption. This approach is different from the zero-tolerance approach in that its focus is directed at the claim

the Philippines (II), ICSID Case No. ARB/11/12, Award dated Dec. 10, 2014; Cortec Mining Kenya Limited et al. v.
Republic of Kenya, ICSID Case No. ARB/15/29, Award dated Oct. 22, 2018.
59
Reichenbach 2022, paras 21.31-21.33 (noting that some tribunals failed to explain why the ICSID Convention only
protects lawful investments, and that other tribunals justified the implicit legality requirements based on various grounds,
including the principle of good faith, nemo auditur, unclean hands and international public policy).
60
Reichenbach 2022, para 21.34; Moloo and Khachaturian 2011, p. 1489; Bear Creek Mining Corp v Republic of Peru,
Award, ICSID Case No ARB/14/21, 30 November 2017 [320] (noting that ‘under international law, the Tribunal may notimport a requirement that limits its jurisdiction when such a limit is not specified by the parties’).
61
Moloo and Khachaturian 2011, p. 1490; Reichenbach 2022, para 21.34.
62
Druce 2018, p. 704.
63
Tamada 2015, p. 117.
64
See eg UNCITRAL 2022 (with helpful summaries of deliberations via McInerney-Lankford and Vasquez 2020; Roberts
and John 2019). In Working III (Investor-State Dispute Settlement Reform) at UNCITRAL, the South African delegate
proposed to limit the protection of investment and the jurisdiction of ISDS tribunals to ‘claims by responsible investors
who have not violated any law, rules, regulations and internationally recognised values, or participated in corrupt activities’:
UNCITRAL 2019, pp. 6 and 9. See also ICSID 2021 (with new ICSID Rules brought into effect from 1 July 2022); andCIDS n.d. (with Concept Papers to support the work of delegates to the UNCITRAL reform deliberations, elaborated intoa special issue: Langford et al. 2020)
65
Meshel 2013.

12

itself and its admissibility rather than the basis of a tribunal’s jurisdiction.66 In Plama Consortium Limited v
Republic of Bulgaria (2008),67 the tribunal found claims for investment protection to be inadmissible if theinvestment has violated the domestic law of the host state and principles of international law. Moreover, in
Churchill Mining PLC and Planet Mining Pty Ltd v Republic of Indonesia (2016) (Churchill Mining case),68
the tribunal decided that all the claims by the British company and its Australian subsidiary were inadmissible
because these were effectively ‘based on documents forged to implement a fraud aimed at obtaining mining
rights’, with the foreign investor found to be wilfully blind to the local investment partner’s forgery of the coalmining exploration licences.69 If issues of corruption or serious irregularity go to admissibility of the claims,
rather than jurisdiction, at least the ISDS tribunal can hear evidence to decide the matter. 70 The tribunal’s
decision will also not trigger any provisions in applicable treaties or arbitration law (say at the seat), for court
review of arbitrator decisions on jurisdictional matters.71
The dissenting opinion by Cremades in the Fraport (I) case was somewhat in line with this approach. It pointed
out that the zero-tolerance approach may leave an investor without a remedy, and a host state secure and immune
in a gross violation of an investment or trade agreement thanks to its corrupt government official.72 His pointis that the tribunal needs to examine corruption allegations carefully to avoid the unfair consequence, and thejurisdictional phase is not appropriate for the tribunal to undertake such careful examination.73 Newcombe isalso in favour of the closer look approach, claiming it is useful to avoid procedural complications at later stages
such as challenge to the arbitral award for the tribunal’s failure to exercise jurisdiction.74
1.3.3.

The ‘It Depends’ Approach

The ‘it depends approach’ argues that the tribunal should carefully hear the substance or merits of the case,depending on the nature of relevant corruption allegations. 75 This can impact on liability, and/or remedies
awarded (typically damages).76 Factors taken into consideration by the tribunal include whether the allegedly

Banifatemi 2015, p. 19 (noting that the short-term result of jurisdiction and admissibility may be the same – thedismissal of arbitral proceedings at the preliminary stage, although a tribunal may not raise admissibility on its own
motion, unlike the case of jurisdiction).
67
ICSID Case No. ARB/03/24, Award, 27 August 2008.
68
ICSID Case No. ARB/12/14 and ICSID Case No. ARB/12/40, Award, 6 December 2016.
69
The Churchill case, p. 191.
70
See generally Banifatemi 2015.
71
Ibid.
72
The Fraport (I) case, p. 23/24.
73
Wilske and Obel 2013, p. 184.
74
Newcombe 2011, p. 199, referring to Malaysian Historical Salvors SDN, BHD v. Malaysia (ICSID Case No. ARB/05/10,
Decision on Annulment of 16 April 2009, para. 80) where the ICSID ad hoc Committee held that the tribunal exceeded
its authority by failing to exercise jurisdiction. More broadly on that case, see also Coppens 2011.
75
Wilske and Obel 2013, pp. 184-186; Tamada 2015, p. 116.
76
See, eg, Hesham T. M. Al Warraq v. Republic of Indonesia (Al Warraq case), UNCITRAL, Final Award dated on 15
December 2014; Burgstaller and Risso 2021, p. 703.
66

13

corrupt country government officials are still in power, and whether there is a commercial custom of backpayments in the host state. The approach encourages tribunals to look at the substance of investment claims, in
relation also to the cause of action (for example, violation of fair and equitable treatment commitments),
referring to the diversity of corrupt practices and the bilateral nature of corruption.77 The tribunal may opt forthis approach, for instance, where there is misconduct by the investor and the host state, or where entry into thedomestic market by foreign investors is practically impossible in the host state without some sort of ‘commission
payment’. Several arbitral tribunals have considered corruption allegations in examining the merits of the
dispute,78 especially where they came across issues pertaining to post-investment corruption.79 For instance,
the tribunal in the Fraport case held that ‘[i]f, at the time of the initiation of the investment, there has been
compliance with the law of the host state, allegations by the host state of violations of its law in the course of
the investment, as a justification for state action with respect to the investment, might be a defence to claimed
substantive violations of the BIT’.80
The ISDS tribunals are further divided on more specific issues, which can arise under all or some of the three
approaches outlined above. Controversial topics include standards of proof for allegations of corruption,81 theevaluation of risk factors that may imply the existence of corruption ie, the treatment of circumstantial evidenceor ‘red flags’ of corruption,82 arbitrator’s investigative and reporting rights and duties on corruption (including
obligations to report corruption to the responsible authority),83 burden of proof for allegations of corruption,84
impact of criminal investigations over arbitral proceedings, 85 attribution to the host state of the corrupt
behaviour on the part of a state official (and then appropriateness for the state to raise corruption as a defence),86
availability of remedies for findings of illegality (such as restitution of benefits under contracts tainted bycorruption),87 possibility for an investor to raise the demand for a bribe from a state agency as the infringement

Wilske and Obel 2013, p. 185.
Schefer 2021, pp. 901-902; Wena Hotels Ltd. v. Arab Republic of Egypt, ICSID Case No. ARB/98/4, Award dated 8
December 2000; Thunderbird Gaming Corporation v. The United Mexican States, UNCITRAL, Arbitral Award dated 26
January 2006.
79
Greenwald and Ivers 2018, pp. 72-74; the Khan Resources case, p. 83; Yukos Universal Limited (Isle of Man) v. The
Russian Federation, PCA Case No. AA 227 (Yukos case), Final Award dated 18 July 2014, p. 430.
80
The Fraport case, pp. 164-165 (emphasis added). See also the dissent of the Fraport case, noting that ‘[a]s a matter ofprinciple, therefore, the legality of the investor’s conduct is a merits issue’ (p. 22).
81
Khvalei 2015; Menaker 2015; Hoepfner 2017, pp. 216ff; Greenwald and Ivers 2018, pp. 38-49; Sayed 2017.
82
Haugeneder 2021, pp. 433-435 (noting that arbitrators are increasingly adopting ICC Guidelines on Agents,
Intermediaries and Other Third Parties 2010, which is the ICC’s publication on “red flags” indicating a risk ofcorruption). See also Gaillard 2019, pp. 3-9; Low 2019; Pieth and Betz 2019; Levine 2021.
83
Ziadé 2015; Marcenaro 2015; Sprange 2015; Baizeau and Hayes 2017; Rose 2014.
84
Tezuka 2015, 58-59; Menaker 2015, 79-82.
85
Besson 2015; Wallgren-Lindholm 2015, pp. 185-186.
86
Nappert 2015; Llamzon 2015; Llamzon 2014, pp. 238-281; Devendra 2019; Wood 2018.
87
Gaillard 2019, pp. 10-12; Fernández-Armesto 2015, pp. 169ff; Partasides 2017.
77
78

14

of its rights such as legal expropriation and fair and equitable treatment,88 plausibility of raising the general
corruption situation in a host state as part of claims of denial of justice arguing the state’s failure to accord fairand equitable investor treatment,89 and prospects of host-state counterclaims where the state is not liable forcorruption.90
1.4. Limited Research On ‘Asian’ Views on Corruption and Investment Arbitration
Despite by now quite a few Asian ISDS arbitration cases, including awards now discussing corruption and otherserious misconduct by investors,91 the literature on Asian perspectives and approaches in this field is rather
scarce. This is surprising given the growing interest in Asian investment treaty and arbitration practice, including
questions as to whether this is or may become distinctive by global standards.92 Thus, for example, Llamzon’s
Corruption in International Investment Arbitration (Oxford University Press 2014) is the first (and probablyonly) comprehensive research monograph that addresses transnational corruption in investment arbitration,
aiming in the words of another commentator ‘to develop a framework for arbitral decision-making when issuesof corruption arise in investment arbitration proceedings’.93 The 358-page volume offers a deep insight of therelationship between investment arbitration and corruption based on the author’s careful and rigorous legal
research.94 However, the book only occasionally discusses the perspectives of Asian countries because its focus
is not in Asian approaches, although it indeed examines several Asia-related ISDS decisions discussing
corruption.95 Moreover, Greenwald and Ivers contributed in 2018 a 93-page report on Addressing Corruption

Schefer 2021, pp. 35-36; Ziadé 2015, pp. 746-747; Llamzon 2014, pp. 119-200; Vijayvergia and Belmannu 2020, Sec.
2.4.
89
Chan 2022.
90
Vijayvergia and Belmannu 2020.
91
The Fraport (I) case; the Metal-Tech case; the Niko case; the Churchill Mining case; Amco Asia et al v Indonesia,
ICSID Case No. ARB/81/1, Award, 20 November 1984; Westinghouse et al v National Power Company, ICC Case No.
6401, 19 September 1991; Philippe Gruslin v Malaysia, ICSID Case No. ARB/99/3, Award, 27 November 2000; Hesham
Talaat M. al-Warraq v Republic of Indonesia, UNCITRAL Arbitration, Final Award, 15 December 2014; Lighthouse
Corporation Pty Ltd and Anor v Democratic Republic of Timor-Leste, ICSID Case No. ARB/15/2, Award, 22 December
2017; Tethyan Copper Company Pty Limited v. Islamic Republic of Pakistan, ICSID Case No. ARB/12/1, Award dated 12
July 2019 (see also Bohmer 2019); Sanum Investments Limited v. Lao People's Democratic Republic, UNCITRAL, PCA
Case No. 2013-13 (the Sanum Investments (I) case), Award dated 6 August 2019, Lao Holdings N.V. v. Lao People's
Democratic Republic, ICSID Case No. ARB(AF)/12/6 (the Lao Holdings (I) case), Award dated 6 August 2019. On thedevelopment of the two Lao-related cases, see Hepburn and Peterson 2012; Charlotin 2021. On a recent corruptionrelated ISDS case involving the government of Mongolia, see Djanic 2022.
92
See eg Chaisse and Nottage 2018; Nottage et al. 2021; Mohan and Brown 2021.
93
Mistelis 2014.
94
Donoghue 2015.
95
Himpurna California Energy Ltd (Bermuda) v. P.T. (Persero) Perusahaan Listruk Negara (Indonesia), Final Award
dated 4 May 1999; SGS v. Philippines, Case No. ARB/02/6, Decision on Jurisdiction dated 29 January 2004; Malaysian
Historical Salvors v. Malaysia Malaysian Historical Salvors Sdn, Bhd v. Government of Malaysia, ICSID Case No.
ARB/05/10, Decision on the Application for Annulment dated 16 April 2009; Niko Resources (Bangladesh) Ltd v.
People's Republic of Bangladesh, BAPEX, and PETROBANGLA, ICSID Case Nos. ARB/10/11 and ARB 10/18, Decisionon Jurisdiction dated 19 August 2013.
8815

Allegations in International Arbitration.96 This material also provides a comprehensive overview of the key
issues that arise in international investment arbitrations involving corruption allegations, without analysing
Asian insights on the issues. Further, the ICC issued in 2015 a dossier in the ICC Institute of World Business
Law Series – Addressing Issues of Corruption in Commercial and Investment Arbitration. 97 This dossiercompiles various reports analysing topical issues of corruption and arbitration, and the authors of the reports
include individuals having a connection with Asia. However, none of the reports offers a close examination of
Asian approaches towards corruption in ISDS.
Such limited coverage of Asia is also salient in research articles addressing specific topics of corruption andother illegal conducts. On the fundamental issue of whether international arbitration is an appropriate forum to
decide corruption claims, Rose’s paper suggests that arbitral tribunals are ill-suited to the adjudication ofcorruption allegations due to the relatively closed and non-transparent character of international arbitration,
which is at odds with the public interest involved in such allegations.98 However, this generalised statement sits
awkwardly with the legal environment of Asia where quite a few jurisdictions have been consistently evaluatedby international organisations as having judicial institutions that offer limited legal certainty and a weak rule oflaw, as mentioned above.99 Polkinghorne and Volkmer discuss three important investment arbitration issues,
namely the source of legality requirement in investment arbitration, its scope and whether legality is ajurisdictional issue or a merit issue, but they pay little attention to BITs concluded between Asian states orarbitration cases involving Asian parties.100 Wilske and Obel classify arbitral tribunals’ handling of corruption
allegations into three categories, but their focus is also not on Asia.101
In addition, several commentators consider state responsibility for corruption in investment arbitration,
discussing when states should be held liable for conduct by their bribed officials. Wood claims that the conductof a corrupt official should seldom be attributable to his or her state because ‘a foreign investor cannot
reasonably assume an official (no matter how high-ranking) to be authorised to engage in and act upon
corruption’. 102 The proponents of the zero-tolerance approach are likely to find Wood’s thesis useful as itsuggests to immune states from the conduct of their allegedly corrupted civil servants. In contrast, Devendra
states that ‘when the international law of [s]tate responsibility is applied, there are circumstances in which a
Greenwald and Ivers 2018.
Baizeau and Kreindler 2015. The ICC Commission on Arbitration and ADR also has a Task Force on Addressing
Issues of Corruption in International Arbitration that is currently compiling national reports, with results expected to beforthcoming in 2022 via ICC n.d., but it is unclear how many Asian jurisdictions will be covered.
98
Rose 2014.
99
For example, Vietnam, Cambodia and Laos: Teramura 2021b, 27; Teramura 2021a.
100
Polkinghorne and Volkmer 2017.
101
Wilske and Obel 2013. Other articles on the three categories do not focus on Asia either. See Tamada 2015; Raouf
2009; Schefer 2021.
102
Wood 2018, p. 117.
96
97

16

host [s]tate may be held internationally responsible for the corrupt conduct of its public officials’.103 Devendra
claims the occurrence of such circumstances depends on several factors, including the public official’s conduct,
the host State’s conduct, the investor’s conduct and the surrounding circumstances. He also comments that thecritical factor is whether the government officer ostensibly exercised official capacity when s/he engaged in thecorrupt conduct. Requiring careful examination by tribunals of corruption and illegality allegations, Devendra’s
thesis is compatible with the ‘closer look approach’ and the ‘it depends approach’. Unfortunately, however, thediscussion of state responsibility for corruption in investment arbitration is limited as Wood’s thesis does not
examine corruption cases in Asia in detail, while Devendra’s argument is largely based on general internationallaw, which has been criticised by some commentators for its Eurocentrism and/or Western centrism.104 Overall,these useful and significant contributions by leading experts of ISDS analyse core issues around corruption andinvestment arbitration without paying great attention to Asian contexts.
Several works certainly discuss “corruption in Asia” or “investment treaties and arbitration in Asia”, but they
typically treat such subjects as distinct and separated matters. They tend not to deeply delve into the intersectionof “corruption in Asia” and “Asian ISDS”. For instance, the Routledge Handbook of Corruption in Asia consistsof 20 chapters addressing diverse Asian experiences in corruption and anti-corruption reforms.105 The edited
handbook provides a critical review of the major issues, trends and challenges of (anti-)corruption reform in
Asia, basically without touching upon matters related to ISDS. Moreover, the Handbook on the Geographies ofCorruption contains national case studies examining specific countries that struggle with corruption, including
some Asian states such as Pakistan, Bangladesh, China, the Philippines, Indonesia and the countries of postSoviet Central Asia.106 However, this 392-page Handbook published by Edward Elgar Publishing does not refer
to ISDS or investment treaties either. Investment Protection in Southeast Asia: A Country-by-Country Guide on
Arbitration Laws and Bilateral Investment Treaties (Brill | Nijhoff 2017) is a handy reference tool especiallyfor practitioners to study investment protection in the region.107 This 462-page collection contains country
reports for all ASEAN member states and Timor-Leste, and each report covers a few key areas, such as arbitrallegislation and institutions in the country, domestic laws related to FDI, an analysis of the BITs entered into by
the state and cases involving the state or its investors. However, the country reports rarely refer to how thecountry regulates investment-related corruption or how it has dealt with corruption-related ISDS cases.
Moreover, Chaisse’s and Nottage’s International Investment Treaties and Arbitration Across Asia (Brill | Nijhoff
2018) introduces FDI trends and regulations, investment treaties and arbitration across Asia.108 The reach of
Devendra 2019.
Caserta 2021, p. 321.
105
Gong and Scott 2016.
106
Warf 2018.
107
Malintoppi and Tan 2017.
108
Chaisse and Nottage 2018.
103
104

17

the 700-page voluminous edited book is more comprehensive in that it offers studies for the ten member statesof the ASEAN and other major players in Asia, including Japan, India, China and Korea. However, relatively
few pages of the volume discuss ISDS matters involving corruption and other serious illegal misconduct. One
may find such limited attention to corruption in ISDS in The Asian Turn in Foreign Investment (Cambridge
University Press 2021). 109 In sum, there is no comprehensive study comparing Asian laws and practices
addressing corruption and illegality in the context of investor-state arbitration.
1.5. Developing Asian Perspectives on Corruption and Illegality in Investment Arbitration
The book aims to examine Asian approaches and case studies toward corruption and serious investor misconduct
in international investment arbitration. It focuses on corruption-related disputes between private parties andpublic sector entities operating in East (North and Southeast) and South Asia. It also covers other serious illegal
conduct in the region that foreign investors have or may become engaged in, which are related to or broadly
equivalent to corruption and bribery.
Since Asia entered the age of mega-free trade agreements, investigating Asian views on corruption and illegality
in investment arbitration has become ever more important. The Comprehensive and Progressive Agreement forTrans-Pacific Partnership (CPTPP) and the Regional Comprehensive Economic Partnership Agreement (RCEP
Agreement) came into force in 2018 and 2022, respectively, mandating member states to combat corruption andother illegal conduct.110 Accordingly, the member states of those arrangements – mostly Asian countries – arenow facing elevated and collective pressure to fight against corruption.111 Nevertheless, both trade agreements
remain silent on how specifically to deal with disputes arising from corruption and illegality at the inter-statelevel. They set out provisions allowing the member states to settle differences through arbitration, but mattersarising from the obligation to address corruption are excluded from such dispute settlement provisions, which
reduces their impact.112 Obligations to encourage ‘Corporate Social Responsibility’ among investors underthese mega-regional FTAs, which could reinforce their anti-bribery obligations, are loosely worded and so notdirectly amenable to ISDS claims.113 Nonetheless, this type of anti-bribery provision contained in several recent
BITs concluded by Japan, for example, ‘although framed as the host state’s obligation, might be taken into
Mohan and Brown 2021.
See Chapter 26 (Transparency and Anticorruption) of the Consolidated TPP Text; and Article 17.9 of the RCEP
Agreement.
111
Chaisse et al. 2022, suggesting the RCEP agreement ‘represents [a region-wide] effort to reconcile overlapping
agreements around a more common template’.
112
Article 26.12.3 of the TPP Text and Article 17.9.2 of the RCEP Agreement.
113
For example, TPP Article 9.17 states: ‘The Parties reaffirm the importance of each Party encouraging enterprises
operating within its territory or subject to its jurisdiction to voluntarily incorporate into their internal policies thoseinternationally recognised standards, guidelines and principles of corporate social responsibility that have been endorsed
or are supported by that Party’. Investor accountability and due diligence have been gaining increasing traction ininternational investment law: Jarrett et al. 2021; Burgstaller and Risso 2021; Llamzon and Chrostin 2021.
109
110

18

account by [an ISDS arbitration] tribunal in determining whether, or to what extent, the investor may invoke’[the treaty’s] protection’.114 Hence, amidst the fresh region-wide condemnation of corrupt acts, investment
arbitration remains a potentially influential platform impacting on corruption-related ISDS cases in Asia.
Nevertheless, the current efforts for fighting corrupt practices in investor-state arbitration are often fragmented,
as discussed elsewhere in this chapter. In view of the situation, we should certainly praise the calls by UNODC
and UNCTAD for further action to establish coherent standards for investment tribunals to tackle corruption,115
provided that the standards reflect also a voice from Asia. Unfortunately, the voice has unlikely reached the earsof international policymakers yet. For instance, the UNODC and the UNCTAD revealed a lack of Asian
representation in their Expert Group Meeting on Corruption and International Investments, which aimed to‘provide a platform for anti-corruption and foreign investment specialists to exchange ideas, discuss common
challenges and identify ways forward with respect to minimising the risk of and opportunities for corruption inforeign direct investments’.116 The Meeting reportedly gathered over 140 experts from 60 countries,117 but the
number of presenters in the event was eighteen,118 and only two speakers were from Asian countries (Mongolia
and China).119 Moreover, as demonstrated above, there is a paucity of research appraising Asian perspectives
on corruption in investment arbitration. Thus, Asian views on corruption and other issues have not gainedinternational attention, despite comments of many trade and investment law experts now suggesting treaty
reforms to upgrade the framework of investor-state arbitration at a global level.120 Someone needs to challenge
the status quo, otherwise Asian states would miss golden opportunities to influence the ongoing international
policy-making process for investment arbitration.
Against the backdrop, this edited volume aims to accumulate and present Asian perspectives, for Asia to build
the foundation of leading the next rounds of treaty reforms in the field of corruption and ISDS. In particular, it
intends to address the following questions:
1. Whether Asia has been and will remain ‘ambivalent’ about international law prohibiting corruption andillegality. How have Asian countries been combatting corruption and other illegal activities particularly
as to foreign investment? What laws and rules exist, and how do they operate in respective jurisdictions?
What are the recent developments?

Ishikawa 2018, pp. 537-538.
UNODC 2021, p. 6.
116
UNODC 2021, p. 3.
117
Kryvoi 2021.
118
UNODC 2021, p. 2.
119
The Mongolian speaker was a UNODC officer based in Vienna, Austria.
120
Nottage et al. 2018; Trakman 2018.
114
115

19

2. Whether and how Asian countries have dealt with corruption and illegality in relation to foreign
investment projects. If they have faced any international investment claims involving such elements,
whether treaty-based ISDS cases or those based on investment contracts providing consent to arbitration,
what are the outcomes and consequences?
3. Whether Asian countries have been or are more likely to become ‘rule makers’ (creating rules on theirown initiative) rather than ‘rule takers’ (following primarily Western normative templates) ininternational investment law, specifically regarding corruption and illegality.121
Those questions will support us to achieve the central objective: to examine Asian approaches toward corruption
and illegality in international investment arbitration. This edited book further takes into account not only legal
perspectives but also non-legal ones such as business and economics.
1.6. Structure of the Book
Following this introductory chapter, the edited volume proceeds as follows. Part I considers wider business andeconomic issues relating to corruption and investment in the Asian region. Ahmed Masood Khalid surveys
diverse discussions on investment-related corruption and its impact on local economies. His analysis focuseson how certain corrupt business practices have deterred (or possibly enhanced) economic growth in Asian
countries.122 Bruno Jetin’s chapter turns to how the level of corruption in host states likely affects the amountof foreign investment into Asian nations. His statistical analysis explores a correlation (if any) between theseriousness of corruption in Asian countries and the decrease and/or increase of FDI flows into the host states.
Masairol Bin Haji Masri’s chapter studies the various accounting measures the Asian states have employed intheir efforts to crackdown on corruption by government officials and/or foreign corporations. The chapter
evaluates how such measures have been (non-)effective for reducing corrupt practices (including grey orborderline ones) persisting in Asian business settings and contexts.
Part II discusses general legal issues related to corruption and investment arbitration in Asia. Martin Jarrett
begins by exploring how an investor’s misconduct should influence the examination of a host state’s liability
for an internationally wrongful act under an investment treaty. As critics have pointed out imbalances between
states and investors pertaining to corruption, Jarrett explores the way to rebalance the asymmetries andfragmentation, regarding (non-)Asian ISDS. Anselmo Reyes then considers corruption regulations in Asia
generating cross-border economic and geopolitical tensions, inspired by the famous Alstom saga in which the
US allegedly applied its anti-corruption regulations in corporate law as an economic weapon against Alstom —Compare generally Chesterman 2017; Chaisse and Nottage 2018; Nottage et al. 2021; Hsieh 2021 (arguing the new
Asian regionalism that shaped the new regional economic order and international trade norms).
122
For example, see Ang 2020.
121

20

a French conglomerate and one of the biggest competitors of General Electric (GE).123 His chapter discusses
how Asian states may invoke their municipal laws to destabilise the world’s largest companies, for the benefitof their national industries. Next, Colin Ong examines the standard of proof for corruption allegations in ISDS.
As briefly mentioned above,124 establishing a clear standard of proof for corruption is a complicated task forarbitrators because they are often required to rely on circumstantial evidence in determining the existence ofillegality. Thus, Ong analyses practical approaches to risk factors or red flags of corruption in Asian ISDS.
Hammeed Abayomi Al-Ameen’s chapter considers Asia’s business laws and corruption in generally, focusing
especially on the experience of Asian common law countries.
Part III collects the reports of corruption ‘hot spots’ in Asia: China (including Hong Kong), India, Indonesia,
Japan, the Lao Republic, the Philippines, South Korea and Thailand. Topics covered in each country report
include general governance and corruption, investment treaties trajectory in the context of corruption, andrelevant ISDS cases involving alleged bribery and serious investor misconduct based on an investment treaty
or contract.
Beginning with the largest economies in Asia, for instance, the Chinese Communist Party launched a farreaching anti-corruption campaign following the conclusion of the 18th National Congress in 2012. Accordingly,
Vivienne Bath discusses the impact of the nation-wide campaign against corruption on the Chinese and Hong
Kong environments for FDI and ISDS, taking into account other Party initiatives such as the Belt and Road
Initiative and the China International Commercial Court. Next, Prabhash Ranjan examines India’s approach tocorruption and illegality in investor-state arbitration. Ranjan sheds light on several corruption-related ISDS
arbitrations involving India as respondent. These include Astro All Asia Networks and South Asia Entertainment
Holdings Limited v India (2016),125 which arose out of an allegedly unfair and biased criminal investigation by
the Indian government on suspected bribery by claimants of Indian government officials; and Strategic Infrasol
Foodstuff LLC and The Joint Venture of Thakur Family Trust, UAE with Ace Hospitality Management DMCC,
UAE v India (2016),126 which concerned the Indian government’s alleged non-investigation of allegations offorgery and criminal actions by an Indian construction company. Then, Simon Butt, Antony Crockett and Tim
Lindsey provide a thorough overview of Indonesia’s quite pervasive corruption, domestic laws and institutions
aiming to combat it, and Indonesia’s evolving investment treaty regime, highlighting the government’s interest
in offering better protection and fair treatment to foreign investments. They further examine Indonesia’s
experience in responding to corruption claims in ISDS, such as in the Churchill Mining case and the Al Warraq

Pierucci 2019.
See Section 1.3.3.
125
PCA Case No. 2016-24/25.
126
UNCITRAL, ad-hoc arbitration.
123
124

21

case. In the ensuing chapter on Japan, a large net capital exporter rather than a major destination for FDI, Dai
Tamada examines anti-bribery and related provisions contained in Japan’s recent investment treaties to assess
their (potential) impact on the operation of Japanese companies in Asia and beyond. Joongi Kim’s chapter onSouth Korea reviews not only the government’s approach towards corruption, which has generated some recent
high-profile cases, but also Korean companies’ experiences in dealing with issues of corrupt practices abroad.
Turning then to smaller and/or more developing economies in Asia, Romesh Weeramantry’s chapter succinctly
explores corruption law and practice in the Lao Republic, highlighting ISDS experience in the cases of Sanum
Investments (I) and Lao Holdings (I). For the Philippines, Jocelyn Cruz, Justin Sucgang and Rebecca Khan
discuss the aftermath of the landmark Fraport (I) case, referring to President Rodrigo Duterte’s fight against
corruption since his presidential appointment in 2016. Lastly, Sakda Thanitcul, Sirilaksana Khoman and Luke
Nottage address Thailand, a country characterised by high inbound FDI and economic growth since the 1980s,
yet multiple military coups and political upheaval as well as domestic laws and institutions aiming to address
corrupt practices. They summarise the distinctive phases and features of Thailand’s investment treaty practices,and key arbitration cases involving the government under treaties or investment contracts (including one brought
recently by an Australian company) where corruption or serious investor illegality have been raised before
tribunals and/or seat courts.
Based on the foregoing general and country-specific reports that examine Asian approaches toward corruption
and illegality in international investment arbitration, the concluding chapter by Teramura, Nottage and Jetin
elaborates on whether Asia has been or could likely become a ‘rule maker’ rather than ‘rule taker’ in ISDS
regarding corruption and illegality. More normatively, the chapter considers what the Asian states and territories
should do, to better contribute to or even lead further investment treaty reforms pertaining to corruption in
investor-state arbitration, and thereby better address corrupt practices and related poor governance moregenerally.

22

References
Alvarez JE, Topalian G (2012) The Paradoxical Argentina Cases. World Arbitration & Mediation Review 6 (3):491-544
Ang YY (2020) China's Gilded Age: The Paradox of Economic Boom and Vast Corruption. Cambridge
University Press, Cambridge, UK
Annan KA (2004) Foreword to United Nations Convention Against Corruption. UNGA Res 58/4:
Antràs P (2020) De-Globalisation? Global Value Chains in the Post-COVID-19 Age, vol 28115. NBER Working
Paper Series. National Bureau of Economic Research, Cambridge, MA, US
Armstrong S (2018) The Impact of Investment Treaties and isds Provisions on fdi in Asia and Globally. In:
Chaisse J, Nottage L (eds) International Investment Treaties and Arbitration Across Asia. Brill | Nijhoff,
Leiden, pp 57-82
Armstrong S, Nottage L (2022) Mixing Methodologies in Empirically Investigating Investment Arbitration andInbound Foreign Investment. In: Behn D, Fauchald OK, Langford M (eds) The Legitimacy of
Investment Arbitration: Empirical Perspectives. Cambridge University Press, Cambridge, UK, pp 315364
Arnone M, Borlini LS (2014) Corruption: Economic Analysis and International Law. Edward Elgar Publishing,Chelterman, UK
Northampton, MA, US
Baizeau D (2015) Introduction: Definitions and Scope of the Topic. In: Baizeau D, Kreindler R (eds) Dossiersof the ICC Institute of World Business Law, Volume 13: Addressing Issues of Corruption in Commercial
and Investment Arbitration. Wolters Kluwer; International Chamber of Commerce, Paris, pp 9-11
Baizeau D, Hayes T (2017) The Arbitral Tribunal’s Duty and Power to Address Corruption Sua Sponte. In:
Menaker A (ed) International Arbitration and the Rule of Law: Contribution and Conformity, ICCA
Congress Series, Volume 19. Wolters Kluwer; ICCA, Alphen aan den Rijn, The Netherlands, pp 225265
Baizeau D, Kreindler R (eds) (2015) Dossiers of the ICC Institute of World Business Law, Volume 13:
Addressing Issues of Corruption in Commercial and Investment Arbitration. Wolters Kluwer;
International Chamber of Commerce, Paris
Ballantyne J (2021) Japanese Investor Wins Damages over Spanish Solar Reforms. Global Arbitration Review,
25 November 2021. https://globalarbitrationreview.com/achmea/japanese-investor-wins-damagesover-spanish-solar-reforms
Banifatemi Y (2015) The Impact of Corruption on “Gateway Issues” of Arbitrability, Jurisdiction, Admissibility
and Procedural Issues. In: Baizeau D, Kreindler R (eds) Dossiers of the ICC Institute of World Business
Law, Volume 13: Addressing Issues of Corruption in Commercial and Investment Arbitration. Wolters
Kluwer; International Chamber of Commerce, Paris, pp 16-31
Bell GF (ed) (2018) The UNCITRAL Model Law and Asian Arbitration Laws: Implementation andComparisons. Cambridge University Press, Cambridge, UK
23

Bermann GA (2017) Recognition and Enforcement of Foreign Arbitral Awards: The Interpretation andApplication of the New York Convention by National Courts. In: Bermann GA (ed) Recognition and
Enforcement of Foreign Arbitral Awards: The Interpretation and Application of the New York
Convention by National Courts. Springer International Publishing, Cham, Switzerland, pp 1-78
Besch M (2015) State Contracts and the Relevance of Investment Contract Arbitration: II. Typical Questions
Arising within Negotiations. In: Bungenberg M, Griebel J, Hobe S, Reinisch A (eds) International
Investment Law: A Handbook. Bloomsbury T&T Clark, London, pp 93-152
Besson S (2015) Corruption and Arbitration: Impact of Criminal Investigations. In: Baizeau D, Kreindler R(eds) Dossiers of the ICC Institute of World Business Law, Volume 13: Addressing Issues of Corruption
in Commercial and Investment Arbitration. Wolters Kluwer; International Chamber of Commerce,
Alphen aan den Rijn, The Netherlands, pp 103-113
Bohmer L (2019) In Tethyan Copper v. Pakistan Corruption Decision, Arbitrators Decide that Pakistan Failed
to Submit “Solid” and “Persuasive” Evidence of Corruption in the Making or Performance of theInvestment.

Investment

Arbitration

Reporter,

15

August2019.

https://www-iareporter-

com.ezproxy.library.sydney.edu.au/articles/in-tethyan-copper-v-pakistan-corruption-decisionarbitrators-decide-that-pakistan-failed-to-submit-solid-and-persuasive-evidence-of-corruption-in-themaking-and-p/
Burgstaller M, Risso G (2021) Due Diligence in International Investment Law. Journal of International
Arbitration 38 (6): 697-722
Carroll T, Hameiri S, Jones L (2020) The Political Economy of Southeast Asia: Politics and Uneven
Development Under Hyperglobalisation. 4th edn. Springer International Publishing, Cham, Switzerland
Caserta S (2021) Western Centrism, Contemporary International Law, and International Courts. Leiden Journalof International Law 34 (2): 321-342
Chaisse J, Elsig M, Jusoh S, Lugg A (2022) Drafting Investment Law: Patterns of Influence in the Regional
Comprehensive Economic Partnership (RCEP). Journal of International Economic Law 25 (1): 110-128
Chaisse J, Nottage L (eds) (2018) International Investment Treaties and Arbitration Across Asia. Brill | Nijhoff,
LeidenChan K-c (2022) Deciding by Numbers: How Do Legal Indicators Impact State Responsibility in Investment
Arbitration.

KluwerArbitration

Blog,

2

April

2022.

http://arbitrationblog.kluwerarbitration.com/2022/04/02/deciding-by-numbers-how-do-legalindicators-impact-state-responsibility-in-investment-arbitration/Charlotin D (2021) Laos Defeats Bid by Casino Investors to Set Aside Pair of Awards; Court Emphasizes That
Arbitrators Have a “Public Duty” to Address Issues of Corruption. Investment Arbitration Reporter, 10
September 2021. https://www-iareporter-com.ezproxy.library.sydney.edu.au/articles/laos-defeats-bidby-casino-investors-to-set-aside-pair-of-awards-court-emphasizes-that-arbitrators-have-a-public-dutyto-address-issues-of-corruption/Charlotin D (2022) Analysis: Sole Arbitrator Finds that, as a Tenant of Territory Still Held by Heirs of Defunct
Sultanate, Malaysia Breached Lease Agreements; State Is Ordered to Repay Nearly 15 Billion USD
24

Considering the Territory’s Oil Resources. Investment Arbitration Reporter, 2 March 2022.
https://www.iareporter.com/articles/analysis-sole-arbitrator-finds-that-as-a-tenant-of-territory-stillheld-by-heirs-of-defunct-sultanate-malaysia-breached-lease-agreements-state-is-ordered-to-repaynearly-15-billion-usd-considering/
Chesterman S (2017) Asia’s Ambivalence about International Law and Institutions: Past, Present and Futures.
European Journal of International Law 27 (4): 945-978
CIDS (n.d.) Academic Forum on ISDS. https://www.cids.ch/academic-forum. Accessed 24 March 2022
Claxton JM (2020) Faithful Friend and Flattering Foe: How Investment Treaties Both Facilitate and Discourage
Investor-State Mediation. Asian Journal on Mediation: 34-51
Cohen L, Li B (2021) The Political Economy of Anti-Bribery Enforcement. NBER Working Paper Series
Coppens G (2011) Treaty Definitions of ‘Investment’ and the Role of Economic Development: A Critical
Analysis of the Malaysian Historical Salvors Cases. In: Bath V, Nottage L (eds) Foreign Investment and
Dispute Resolution Law and Practice in Asia. Routledge, London, pp 174-191
Davids C, Schubert G (2011) The Global Architecture of Foreign Bribery Control: Applying the OECD Bribery
Convention. In: Graycar A, Smith RG (eds) Handbook of Global Research and Practice in Corruption.
Edward Elgar Publishing, Cheltenham, UK
Northampton, US, pp 319-339
Devendra IC (2019) State Responsibility for Corruption in International Investment Arbitration. Journal ofInternational Dispute Settlement 10 (2): 248-287
Djanic V (2022) Tribunal Issues Partial Award in Opaque UNCITRAL Arbitration Against Asian State.
Investment

Arbitration

Reporter,

4

March

2022.

https://www-iareporter-

com.ezproxy.library.sydney.edu.au/articles/tribunal-issues-partial-award-in-opaque-unictralarbitration-against-asian-state/
Donoghue JE (2015) The Corruption Trump in Investment Arbitration. ICSID Review - Foreign Investment
Law Journal 30 (3): 756-761
Druce J (2018) Fiat iustitia, ne pereat mundus: A Novel Approach to Corruption and Investment Arbitration.
Journal of International Arbitration 35 (6): 665-718
Dupont C, Schultz T, Angin M (2022) Double Jeopardy? The Use of Investment Arbitration in Times of Crisis.
In: Behn D, Fauchald OK, Langford M (eds) The Legitimacy of Investment Arbitration: Empirical
Perspectives. Cambridge University Press, Cambridge, UK, pp 365-393
Fernández-Armesto J (2015) The Effects of a Positive Finding of Corruption. In: Baizeau D, Kreindler R (eds)
Dossiers of the ICC Institute of World Business Law, Volume 13: Addressing Issues of Corruption in
Commercial and Investment Arbitration. Wolters Kluwer; International Chamber of Commerce, Alphen
aan den Rijn, The Netherlands, pp 167-174
Gaillard E (2019) The Emergence of Transnational Responses to Corruption in International Arbitration.
Arbitration International 35 (1): 1-19
García-Castrillón CO (2016) Spain and Investment Arbitration: The Renewable Energy Explosion. InvestorState Arbitration Series (17)25

García-Castrillón CO (2017) Spain and Investment Arbitration: The Renewable Energy Explosion. In: Mestral
Ad (ed) Second Thoughts: Investor State Arbitration between Developed Democracies. McGill-Queen's
University Press, Montreal, pp 285-308
Gong T, Scott I (eds) (2016) Routledge Hanbook of Corruption in Asia. Routledge, London
Greenwald BK, Ivers JA (2018) Addressing Corruption Allegations in International Arbitration. Brill Research
Perspectives in International Investment Law and Arbitration 2 (3): 1-93
Harris H, Nolan J (2021) Learning From Experience: Comparing Legal Approaches To Foreign Bribery And
Modern Slavery. Cardozo International & Comparative Law Review 4 (2): 603-652
Haugeneder F (2021) Dealing with Corruption. In: Lim CL (ed) The Cambridge Companion to International
Arbitration. Cambridge University Press, Cambridge, UK, pp 410-437
Hepburn J, Peterson LE (2012) Laos Has Yet to Pay $56 Million Arbitral Debt, but New Investors Line Up to
Sue; Chinese Claimant Says MFN Clause Circumvents Narrow Arbitration Clause. Investment
Arbitration

Reporter,

19

August2012.

https://www-iareporter-

com.ezproxy.library.sydney.edu.au/articles/laos-has-yet-to-pay-56-million-arbitral-debt-but-newinvestors-line-up-to-sue-chinese-claimant-says-mfn-clause-circumvents-narrow-arbitration-clause/
Hobe S (2015) The Law Relating to Aliens, the International Minimum Standard and State Responsibility: I.
The Development of the Law of Aliens and the Emergence of General Principles of Protection under
Public International Law. In: Bungenberg M, Griebel J, Hobe S, Reinisch A (eds) International
Investment Law. Bloomsbury T&T Clark, London, pp 6-22
Hoepfner CWVW (2017) The Corruption Defense and Preserving the Rule of Law. In: Menaker A (ed)International Arbitration and the Rule of Law: Contribution and Conformity, ICCA Congress Series,
Volume 19. Wolters Kluwer; ICCA, Alphen aan den Rijn, pp 203-224
Hsieh PL (2021) New Asian Regionalism in International Economic Law. Cambridge University Press,
Cambridge, UK
ICC (n.d.) Commission on Arbitration and ADR. https://iccwbo.org/dispute-resolution-services/commissionon-arbitration-and-adr/. Accessed 24 March 2022
ICSID

(2021)

Resources:

ICSID

Rules

and

Regulations

Amendment.

https://icsid.worldbank.org/resources/rules-amendments. Accessed 24 March 2022
ICSID (2022a) Cases Database: Search Cases. https://icsid.worldbank.org/cases/case-database. Accessed 23
March 2022
ICSID

(2022b)Resources:

ICSID

Convention.

https://icsid.worldbank.org/resources/rules-and-regulations/convention/overview. Accessed 24 March 2022
International T (2022) CPI 2021 for Asia Pacific: Grand Corruption and Lack of Freedomes Holding Back
Progress.

Transparency

International:

News,

25

January

https://www.transparency.org/en/news/cpi-2021-for-asia-pacific-grand-corruption-holding-backprogress

26

2022.

Ishikawa T (2018) A Japanese Perspective on International Investment Agreements: Recent Developments. In:
Chaisse J, Nottage L (eds) International Investment Treaties and Arbitration Across Asia. Brill | Nijhoff,
Leiden, pp 513-543
Jarrett M, Puig S, Ratner S (2021) Towards Greater Investor Accountability: Indirect Actions, Direct Actions byStates and Direct Actions by Individuals. Journal of International Dispute Settlement 00: 1-26
Joutsen M (2011) The United Nations Convention Against Corruption. In: Graycar A, Smith RG (eds) Handbookof Global Research and Practice in Corruption. Edward Elgar Publishing, Cheltenham, UK
Northamton, US, pp 303-318
Khvalei V (2015) Standards of Proof for Allegations of Corruption in International Arbitration. In: Baizeau D,
Kreindler R (eds) Dossiers of the ICC Institute of World Business Law, Volume 13: Addressing Issuesof Corruption in Commercial and Investment Arbitration. Wolters Kluwer; International Chamber ofCommerce, Paris, pp 69-76
Kim J (2012) A Pivot to Asia in Investor–State Arbitration: The Coming Emergence of Asian Claimants Get
access Arrow. ICSID Review - Foreign Investment Law Journal 27 (2): 399-415
Kryvoi Y (2021) Expert Group Meeting on Corruption and International Investments – Key Findings Revealed.
BIICL Blog, 20 December 2021. https://www.biicl.org/blog/30/expert-group-meeting-on-corruptionand-international-investments-key-findingsrevealed#:~:text=The%20Expert%20Group%20Meeting%20took,finance%20institutions%2C%20nat
ional%20and%20international
Langford M, Potestà M, Kaufmann-Kohler G, Behn D (2020) Special Issue: UNCITRAL and Investment
Arbitration Reform: Matching Concerns and Solutions (An Introduction). The Journal of World
Investment & Trade 21 (2-3): 167-187
Levine J (2021) Corruption and International Arbitration - Toils and Tools for Tribunals. Transnational Dispute
Management 18 (3): 1-4
Llamzon A (2014) Corruption in International Investment Arbitration. Oxford University Press, Oxford
Llamzon A (2015) On Corruption’s Peremptory Treatment in International Arbitration: State Responsibility,
Unclean Hands, and the Return of Corruption as a Jurisdictional Issue. In: Baizeau D, Kreindler R (eds)
Dossiers of the ICC Institute of World Business Law, Volume 13: Addressing Issues of Corruption in
Commercial and Investment Arbitration. Wolters Kluwer; International Chamber of Commerce, pp 3250
Llamzon A, Chrostin JBu (2021) The Due Diligence Expansion in International Investment Arbitration. In:
Mohan M, Brown C (eds) The Asian Turn in Foreign Investment. Cambridge University Press,
Cambridge, UK, pp 261-278
Low LA (2019) Symposium on New Directions in Anticorruption Law: Dealing with Allegations of Corruption
in International Arbitration. AJIL Unbound 113: 341-345
Malintoppi L, Tan C (eds) (2017) Investment Protection in Southeast Asia: A Country-by-Country Guide on
Arbitration Laws and Bilateral Investment Treaties. Brill Nijhof, Leiden
27Marcenaro E (2015) Arbitrators’ Investigative and Reporting Rights and Duties on Corruption. In: Baizeau D,
Kreindler R (eds) Dossiers of the ICC Institute of World Business Law, Volume 13: Addressing Issuesof Corruption in Commercial and Investment Arbitration. Wolters Kluwer; International Chamber ofCommerce, Paris, pp 141-157
McInerney-Lankford S, Vasquez MC (2020) UNCITRAL WGIII and Human Rights: Towards a More Balanced
ISDS System? EJIL: Talk!, 8 October 2020. https://www.ejiltalk.org/uncitral-wgiii-and-human-rightstowards-a-more-balanced-isds-system/
Menaker A (2015) Proving Corruption in International Arbitration: Who Has the Burden and How Can It Be
Met? In: Baizeau D, Kreindler R (eds) Dossiers of the ICC Institute of World Business Law, Volume
13: Addressing Issues of Corruption in Commercial and Investment Arbitration. Wolters Kluwer;
International Chamber of Commerce, Paris, pp 77-102
Meshel T (2013) The Use and Misuse of the Corruption Defence in International Investment Arbitration. Journalof International Arbitration 30 (3): 267-281
Mistelis L (2014) Series Editor's Preface. In: Llamzon A (ed) Corruption in International Investment Arbitration.
Oxford University Press, Oxford, pp vii - x
Mohan M, Brown C (eds) (2021) The Asian Turn in Foreign Investment. Cambridge University Press,
Cambridge, UK
Moloo R, Khachaturian A (2011) The Compliance with the Law Requirement in International Investment Law.
Fordham International Law Journal 34 (6): 1473-1501
Nappert S (2015) Raising Corruption as a Defence in Investment Arbitration. In: Baizeau D, Kreindler R (eds)
Dossiers of the ICC Institute of World Business Law, Volume 13: Addressing Issues of Corruption in
Commercial and Investment Arbitration. Wolters Kluwer; International Chamber of Commerce, Paris,
pp 175-183
Newcombe A (2011) Investor Misconduct: Jurisdiction, Admissibility or Merits? In: Brown C, Miles K (eds)
Evolution in Investment Treaty Law and Arbitration. Cambridge University Press, Cambridge, UK, pp
187-200
Nottage L (2021a) International Commercial and Investor-State Arbitration: Australia and Japan in Regional
and Global Contexts. Edward Elgar Publishing, Cheltenham, UK
Northampton, US
Nottage L (2021b) Rebalancing Investment Treaties and Investor–State Arbitration in the Asian Region. In:
Mohan M, Brown C (eds) The Asian Turn in Foreign Investment. Cambridge University Press,
Cambridge, UK, pp 379-398
Nottage L (2022) International Arbitration and Society at Large. In: Bjorklund A, Ferrari F, Kröll S (eds)
Cambridge Compendium of International Commercial and Investment Arbitration. Cambridge
University Press, Cambridge, UK, p [Forthcoming]
Nottage L, Ali S, Jetin B, Teramura N (eds) (2021) New Frontiers in Asia-Pacific International Arbitration and
Dispute Resolution. Wolters Kluwer, Alphen aan den Rijn, The Netherlands
28Nottage L, Chaisse J, Thanitcul S (2018) International Investment Treaties and Arbitration Across Asia: A Bird’s
Eye View. In: Chaisse J, Nottage L (eds) Investment Treaties and Arbitration Across Asia. Brill | Nijhoff,
Leiden, pp 1-56
Nottage L, Thanitcul S (2017) International Investment Arbitration in Thailand: Limiting Contract-Based
Claims While Maintaining Treaty-Based ISDS. The Journal of World Investment & Trade 18 (5-6):
793–835
Nottage L, Weeramantry JR (2011) Foreign Investment and Dispute Resolution Law and Practice in Asia. In:
Bath V, Nottage L (eds) Investment Arbitration in Asia: Five Perspectives on Law and Practice.
Routledge, London, pp 25-52
Nottage L, Weeramantry JR (2012) Investment Arbitration in Asia: Five Perspectives on Law and Practice Get
access Arrow. Arbitration International 28 (1): 19-62
Obersteiner T (2014) ‘In Accordance with Domestic Law’ Clauses: How International Investment Tribunals
Deal with Allegations of Unlawful Conduct of Investors. Journal of International Arbitration 31 (2):265-288
OECD (n.d.-a) Data on Enforcement of the Anti-Bribery Convention. https://www.oecd.org/corruption/data-onenforcement-of-the-anti-bribery-convention.htm. Accessed 26 March 2022
OECD (n.d.-b) OECD Convention on Combating Bribery of Foreign Public Officials in International BusinessTransactions. https://www.oecd.org/corruption/oecdantibriberyconvention.htm.
Park SK, Samples TR (2017) Tribunalizing Sovereign Debt: Argentina's Experience with Investor–State Dispute
Settlement. Vanderbilt Journal of Transnational Law 50 (4): 1033-1063
Partasides C (2017) Remedies for Findings of Illegality in Investment Arbitration. In: Menaker A (ed)International Arbitration and the Rule of Law: Contribution and Conformity, ICCA Congress Series,
Volume 19. Wolters Kluwer; ICCA, Alphen aan den Rijn, The Netherlands, pp 740-745
Pavić V (2012) Bribery and International Commercial Arbitration—the Role of Mandatory Rules and Public
Policy. Victoria University of Wellington Law Review 43: 661-686
Pierucci F (2019) The American Trap: My Battle to Expose America's Secret Economic War Against the Restof the World. Hodder & Stoughton, London
Pieth M (2020) Negotiating Settlements in a Broader Law Enforcement Context. In: Søreide T, Makinwa A(eds) Negotiated Settlements in Bribery Cases: A Principled Approach. Edward Elgar Publishing,Cheltenham, UK
Northampton, US, pp 19-24
Pieth M, Betz K (eds) (2019) Corruption and Money Laundering in International Arbitration: A Toolkit for
Arbitrators. Basel Institute on Governance and Competence Centre for Arbitration and Crime, Basel,
Switzerland
Polkinghorne M, Volkmer S-M (2017) The Legality Requirement in Investment Arbitration. Journal ofInternational Arbitration 34 (2): 149-168
Raouf MA (2009) How Should International Arbitrators Tackle Corruption Issues? ICSID Review - Foreign
Investment Law Journal 24 (1): 119-136
29

Reichenbach C (2022) The Corruption Defence and the Jurisdictional Consequences of Corruption Allegationsin International Law and Investment Arbitration. In: Sachs LE, Johnson LJ, Coleman J (eds) Yearbook
on International Investment Law & Policy 2020. Oxford University Press, Oxford,
Roberts A, John TS (2019) UNCITRAL and ISDS Reforms: Agenda-Widening and Paradigm-Shifting. EJIL:
Talk!, 20 September 2019. https://www.ejiltalk.org/uncitral-and-isds-reforms-agenda-widening-andparadigm-shifting/Rogers CA, Drahozal CR (2022) Does International Arbitration Enfeeble or Enhance Local Legal Institutions?
In: Behn D, Fauchald OK, Langford M (eds) The Legitimacy of Investment Arbitration: Empirical
Perspectives. Cambridge University Press, Cambridge, UK, pp 467-500
Rose C (2014) Questioning the Role of International Arbitration in the Fight against Corruption. Journal ofInternational Arbitration 31 (2): 183-264
Sayed A (2017) Duplicity in Corruption and Arbitration: Dealing with the Evidentiary Gap. In: Menaker A (ed)International Arbitration and the Rule of Law: Contribution and Conformity, ICCA Congress Series,
Volume 19. Wolters Kluwer; ICCA, Alphen aan den Rijn, The Netherlands, pp 266-282
Schefer KN (2021) Crime in International Investment Arbitration. In: Chaisse J, Choukroune L, Jusoh S (eds)
Handbook of International Investment Law and Policy. Springer Nature Singapore, Singapore, pp 881915
Schmidl M (2021) The Renewable Energy Saga from Charanne v. Spain to The PV Investors v. Spain: Trying
to

See

the

Wood

for

the

Trees.

KluwerArbitration

Blog,

1

February2021.

http://arbitrationblog.kluwerarbitration.com/2021/02/01/the-renewable-energy-saga-from-charanne-vspain-to-the-pv-investors-v-spain-trying-to-see-the-wood-for-the-trees/
Sim C (2019) Should Arbitral Institutions Have Diplomatic Immunity? Kluwer Arbitration Blog, 27 February
2019.

http://arbitrationblog.kluwerarbitration.com/2019/02/27/should-arbitral-institutions-have-

diplomatic-immunity/
Singh J (2021) Indian Investment Treaty Practice: Qualitatively and Quantitatively Assessing Recent
Developments. In: Nottage L, Ali S, Jetin B, Teramura N (eds) New Frontiers in Asia-PacificInternational Arbitration and Dispute Resolution. Wolters Kluwer, Alphen aan den Rijn, The
Netherlands, pp 287-312
Sprange TK (2015) Corruption in Arbitration: Sua Sponte Investigations — Duty to Report. In: Baizeau D,
Kreindler R (eds) Dossiers of the ICC Institute of World Business Law, Volume 13: Addressing Issuesof Corruption in Commercial and Investment Arbitration. Wolters Kluwer; International Chamber ofCommerce, Paris, pp 134-140
Subramanian A, Kessler M (2013) The Hyperglobalization of Trade and Its Future. Working Paper 13-6: 1-66
Tamada D (2015) Host States as Claimants: Corruption Allegations. In: Lalani S, Lazo RP (eds) The Role of
the State in Investor-State Arbitration. Brill | Nijhof, Leiden, pp 103-122
Teramura N (2021a) Direct Jurisdiction: Asian Perspectives. In: Reyes A, Lui W (eds). Hart Publishing, Oxford,
pp 201-219

30

Teramura N (2021b) Japan as a Source of Legal Ideas: A View from the Mekong Subregion of ASEAN. New
Voices in Japanese Studies 13: 19-46
Tezuka H (2015) Corruption Issues in the Jurisdictional Phase of Investment Arbitrations. In: Baizeau D,
Kreindler R (eds) Dossiers of the ICC Institute of World Business Law, Volume 13: Addressing Issuesof Corruption in Commercial and Investment Arbitration. Wolters Kluwer; International Chamber ofCommerce, Alphen aan den Rijn, The Netherlands, pp 51-68
Trakman L (2018) An Empirical Case for Extending Standing Panels in Investor-State Arbitration. In: Chaisse
J, Nottage L (eds) International Investment Treaties and Arbitration Across Asia. Brill | Nijhoff, Leiden,
pp 613-645
Ubilava A (2022) Mediation as a Mandatory Precondition to Investor-State Arbitration. Brill | Nijhoff, Leiden
UNCITRAL (2019) Possible Reform of Investor-State Dispute Settlement (ISDS): Submission from theGovernment of South Africa. United Nations Commission on International Trade Law, Working GroupIII (Investor-State Dispute Settlement Reform), Thirty-eighth Session, Vienna, 14-18 October 2019
(A/CN.9/WG.III/WP.176)
UNCITRAL (2022) Working Group III: Investor-State Dispute Settlement Reform: Status of Work as of March
2022. https://uncitral.un.org/en/working_groups/3/investor-state. Accessed 24 March 2022
UNCITRAL (n.d.-a) Status: Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New
York,

1958)

(the

"New

York

Convention").

https://uncitral.un.org/en/texts/arbitration/conventions/foreign_arbitral_awards/status2. Accessed 24
March 2022
UNCITRAL (n.d.-b) Status: UNCITRAL Model Law on International Commercial Arbitration (1985), with
amendments

asadoptedin2006.

https://uncitral.un.org/en/texts/arbitration/modellaw/commercial_arbitration/status.

Accessed

24

March 2022
UNCTAD (2018) World Investment Report 2018: Investment and New Industrial Policies. United Nations
Publication, Geneva
UNCTAD (2019) World Investment Report 2019. Special Economic Zones. United Nations Publication, Geneva
UNCTAD (2021) World Investment Report 2021: Investing in Sustainable Recovery. United Nations
Publication, Geneva
UNCTAD (2022) World Investment Report 2020: International Production Beyond the Pandemic. United
Nations Publication, Geneva
UNCTAD(n.d.-a)International

Investment

Agreements

Navigator.

https://investmentpolicy.unctad.org/international-investment-agreements. Accessed 23 March 2022
UNCTAD(n.d.-b)

Investment

DisputeSettlement

Navigator:

Advanced

Search.

https://investmentpolicy.unctad.org/investment-dispute-settlement/advanced-search. Accessed 1 March
2022
UNCTAD(n.d.-c)Investment

PolicyHub:Investment

DisputeSettlement

Navigator.

https://investmentpolicy.unctad.org/investment-dispute-settlement. Accessed 23 March 2022
31

UNCTAD(n.d.-d)Investment

PolicyHub:

Mappingof

IIA

clauses.

https://investmentpolicy.unctad.org/pages/1031/mapping-of-iia-clauses.
UNODC (2021) Executive Summary of the Follow-up Report of the Expert Group Meeting on Corruption andInternational Investments held virtually on May 18–19, 2021. CAC/COSP/2021/CRP13:1-7
UNODC (n.d.-a) Signature and Ratification Status. https://www.unodc.org/unodc/en/corruption/ratificationstatus.html.
UNODC(n.d.-b)

UnitedNations

Convention

againstCorruption.

https://www.unodc.org/unodc/en/corruption/uncac.html.
Vijayvergia C, Belmannu P (2020) Exploring the Prospects of Host-State Counterclaims in Corruption Disputes.
Arbitration International 36 (4): 583-600
Wallgren-Lindholm C (2015) Consequences and Effects of Allegations or of a Positive Finding of Corruption.
In: Baizeau D, Kreindler R (eds) Dossiers of the ICC Institute of World Business Law, Volume 13:
Addressing Issues of Corruption in Commercial and Investment Arbitration. Wolters Kluwer;
International Chamber of Commerce, Alphen aan den Rijn, The Netherlands, pp 184-186
Walter Av (2015) State Contracts and the Relevance of Investment Contract Arbitration: I. Investor-State
Contracts in the Context of International Investment Law. In: Bungenberg M, Griebel J, Hobe S,
Reinisch A (eds) International Investment Law: A Handbook. Bloomsbury T&T Clark, London,
Warf B (ed) (2018) Handbook on the Geographies of Corruption. Edward Elgar Publishing, Cheltenham, UK
Northampton, US
Wetter JG (1994) Issues of Corruption before International Arbitral Tribunals: The Authentic Text and True
Meaning of Judge Gunnar Lagergren's 1963 Award in ICC Case No. 1110. Arbitration International 10(3): 277-294
Wilske S, Obel W (2013) The “Corruption Objection” to Jurisdiction in Investment Arbitration: Does It ReallyProtect the Poor? In: Schefer KN (ed) Poverty and the International Economic Legal System: Duties tothe World's Poor. Cambdidge University Press, Cambridge, UK, pp 177-188
WJP (2021) The World Justice Project Rule of Law Index® 2021
Wood T (2018) State Responsibility for the Acts of Corrupt Officials: Applying the ‘Reasonable Foreign
Investor’ Standard. Journal of International Arbitration 35 (1): 103-118
Ziadé NG (2015) Addressing Allegations and Findings of Corruption: The Arbitrator's Investigative andReporting Rights and Duties. In: Baizeau D, Kreindler R (eds) Dossiers of the ICC Institute of World
Business Law, Volume 13: Corruption in Commercial and Investment Arbitration. Wolters Kluwer;
International Chamber of Commerce, Paris, pp 114-133

32