bluuebunny/crossref_metadata_2025 huggingface dataset:
International Cooperation to Avoid Double Taxation in the Field of VAT: Does the Court of Justice Produce a Revolution?
Authors: De Troyer Ilse
Published: March 2022

The EU Court of Justice recently confirmed that EU Member States have a duty to cooperate to help ensure that Value Added Tax (VAT) is correctly assessed. In the Court’s view, this implies that they have to exchange information whenever a request for information may prove expedient, or even necessary for determining where the VAT is due. This judgment deviates from former case law. It may considerably affect the rights of taxable persons facing a double VAT taxation of their transactions. This article provides an overview of (possible) implications of this judgment.
CFC Rules and Anti-Tax Avoidance Directive
Authors: Schönfeld Jens
Published: March 2022

The effects of the Anti-Tax Avoidance Directive (ATAD) on Controlled Foreign Company (CFC) rules have been instructively discussed in depth, especially in the German scholarly literature.1 The following contribution re-examines a few aspects against the background of a hypothetical case and addresses various issues, including the question as to whether the Directive does not also give taxpayers a certain minimum level of protection and at the same time impose general limits on national legislatures.
Is the State Aid Regime a Suitable Instrument to Be Used in the Fight Against Harmful Tax Competition?
Authors: Forrester Emily
Published: March 2022

The aim of this article is to analyse the suitability of the State aid regime as an instrument to fight harmful tax competition. There are several negative effects of such ‘race to the bottom’ competition, which act as significant barriers to the functioning of the internal market. Application of the State aid rules has been troubled and heavily influenced by the fluctuating policy objectives of the Commission. There has been a long established intersect between State aid and taxation, although, such overlap has been expanding and ever encroaching within the taxation policies of Member States, which is presently considered sovereign territory. The current investigations into numerous multinational enterprises, for instance Apple, signify a radical new approach adopted by the Commission, one which could not have been predicted by neither the Member States nor corporations. It is evident that the Commission have adopted the State aid rules as a tool to attack harmful tax competition, and to ensure that selective corporations are not receiving unbridled benefits through favourable tax rulings. However, the State aid regime is not and should not be used as an anti-competition instrument which allows the Commission to scrutinize every new tax measure adopted by Member States. Such developments are inappropriate and represents a radical shift away from precedent, creating uncertainty in the area of international taxation. Harmonization or regulatory competition seems a more suitable fit for the issue of harmful tax competition, plaguing the internal market.
Tax Administration Good Governance
Authors: Végh Gyöngyi
Published: March 2022

Tax law provisions only have the desired effect if these are properly administered. In each country, tax administration is governed by different sets of rules which together form the so-called ‘tax administration governance framework’. This framework includes rules which vest the powers of administration in the tax authority, determine the rights and obligations of taxpayers and define ‘checks and balances’. At the same time, the functioning of a tax authority is greatly influenced by its environment, including social, economic and technological developments. As a result, building an effective and efficient tax administration is a challenging, but important task in practice. It is not only important for a country’s tax revenue, but also for economic prosperity as issues in tax administration may negatively impact trade and investment. All these different aspects make that tax administration is a complex phenomenon whereby good governance is key to its effective and efficient functioning. Accordingly, several international initiatives have been taken to establish good practices and set international benchmarks in assessing tax administration.
Definitive VAT Regime: Stairway to Heaven or Highway to Hell?
Authors: van der Doef Bart , Gruson John , Verbaan Naomie
Published: March 2022

The current VAT system was intended to be a transitional system applying an origin-based taxation system and it is generally found to be complex and susceptible to VAT fraud. The legislative proposals for a definitive VAT system for cross-border trade as announced by the European Commission on 4 October 2017 relies therefore on a radically different method of taxation based on the principle of taxation in the country of destination of the goods. Part of the proposals is four quick fixes intended to simplify various aspects relating to the current VAT system for cross-border trade and the introduction of the Certified Taxable Person status. In this article the authors comment on the individual components of the proposals and address the various questions the proposals raise. It is highly likely that adoption of the proposed measures will lead to a more uniform application of VAT rules and legal certainty for businesses. However, due to various reasons the phenomenon of the Certified Taxable Person will prove to be an important obstacle in achieving the required unanimity in the Economic and Financial Council.
State Aid, Taxation & Transfer Pricing: Illegal Fiscal State Aid Granted to Starbucks?
Authors: Vos Bram
Published: March 2022

On 21 October 2015 the European Commission alleged the Netherlands of granting illegal fiscal State aid to Starbucks by misapplying the so-called ‘EU arm’s length principle’ through an Advance Pricing Agreement concluded between the Dutch tax administration and Starbucks. Accordingly, no market based (read: too high) transfer prices would have been adopted by Starbucks, resulting in an assumed reduction of taxable income and thereby also in a reduction of imposed corporate income tax. The Netherlands and Starbucks however disagree with the European Commission’s finding of State aid and applied for annulment of the EU Decision at the General Court.

 

This article will discuss in what way and to what extent the reasoning of the European Commission in the EU Decision is in conformity with Article 107 TFEU and (the explanation of) the EU arm’s length principle (by the CJEU). The author will elaborate on the factual and fiscal background of the case and provide an assessment of the contested reasoning in the EU Decision. In addition, the issue on the potential existence of an ‘EU arm’s length principle’ will be discussed by the author based on jurisprudence of the CJEU.
Some Thoughts on the Management of Special Investment Funds Following the Entering into Force of the AIFM Directive
Authors: Koeprijanov Dimitri
Published: March 2022

The VAT exemption for management of special investment funds has been a topic of discussion for a long time. In the Fiscale Eenheid X NV judgment (9 December 2015, C-595/13), the Court of Justice of the European Union again gave its view on the interpretation of this exemption. The judgment raises many questions and the fact that the dispute relates to a period in which the AIFM Directive had not yet been introduced makes these questions even more complicated. In this contribution, the authors share their thoughts on the consequences of the judgment, the introduction of the AIFM Directive and the current scope of the exemption for management of special investment funds. In particular attention will be paid to the interpretation of the terms ‘special investment fund’ and ‘management’
The Polbud-Case and New EU Company Law Proposal: Expanding the Possibilities for Cross-Border Conversions in Europe.
Authors: van Gelder Gabriël
Published: March 2022

On 25 October 2017, the European Court of Justice ruled in the Polbud-case that a cross-border conversion is permitted on the basis of the freedom of establishment, even if the converted company does not conduct any economic activities in the new home Member State. On 25 April 2018, the European Commission proposed new company law rules to enable companies to make best of business opportunities in the EU’s Single Market and to ensure that cross-border conversions, mergers and divisions are accompanied by adequate safeguards against abuse. This directive explicitly refers to the Polbud-case. In this article the Polbud-judgment is discussed in the broader context of cross-border conversions. Furthermore, the proposal of the European Commission is discussed and the antitax abuse provision thereof.
Tax Policy Convergence and EU Fiscal State Aid Control: In Search of Rationality
Authors: Peters Cees
Published: March 2022

The pending tax ruling constitute a new saga in the continuous political battle between the Member States and the European Commission about the limits of article 107 TFEU within the complex multi-level tax governance system of the EU. This article claims that the legal determination of these limits – as reflected in the distinction between general measures and fiscal state aids – cannot provide for a rational explanation concerning the balance of power between the Member States and the European Commission. Consequently, it cannot be maintained that the European Commission should merely monitor the limits of EU fiscal state aid control as defined by the Member States. Such an understanding is at odds with the prevailing neo-functionalist reality in which the European Commission is able to develop state aid policies in an independent way. This contribution reaches these conclusions on the basis of a combination of the legal and the political-economic traditions that study EU (fiscal) state aid control. It calls for more multidisciplinary academic discussion about the desirable function and limits of EU fiscal state aid control.
VAT and Blockchain: Challenges and Opportunities Ahead
Authors: Merkx Madeleine
Published: March 2022

Blockchain is best known as the technology behind the popular cryptocurrency bitcoin, but the application of blockchain is much broader. In this article the author outlines opportunities and challenges for application of blockchain in VAT. She also analyses in detail what aspects of the VAT legislation and its implementation may be affected by blockchain in the future.
Case C-28/17 NN A/S v. Skatteministeriet: A CJEU Judgment that Raises Fresh Questions
Authors: Dafnomilis Vassilis , Vermeulen Hein
Published: March 2022

On 4 July 2018, the Court of Justice of the European Union ruled in Case C-28/17 NN A/S v. Skatteministeriet on the compatibility of paragraph 31(2)(2) of the Danish Corporate Income Tax Code with the freedom of establishment (Article 49 of the Treaty on the Functioning of the European Union). Under this rule, a loss incurred by a Danish permanent establishment in Denmark could be deducted in Denmark only if such a loss could not be used for purposes of foreign taxation. In this contribution, the authors provide a summary of the CJEU judgment in NN and focus on some selected aspects of the CJEU judgment, i.e. (1) the difference of the NN case with the Philips Electronics case (C-18/11), (2) the ‘removable’ difference in treatment, (3) the ‘conditional’ objective comparability assessment, (4) the risk of the double use of losses as an overriding reason in the public interest and (5) the reference of the CJEU to losses that are practically impossible to be deducted abroad.
Morgan Stanley Judgment: The Emergence of Transnational VAT Pro Rata Calculations
Authors: Gamito Philippe
Published: March 2022

The lack of legal clarity regarding VAT recovery and deductible proportion rules applicable to a branch providing support services to its overseas head-office has led to the application of different deduction methods across the European Union (EU). On 24 January 2019, the Court of Justice of the European Union (CJEU) released a long-awaited judgment in Morgan Stanley & Co International plc (Morgan Stanley) (C-165/17). The Court opined that the French branch of a Morgan Stanley entity with its head-office in the United Kingdom should use two pro rata calculations to recover French VAT incurred. One regarding expenditure exclusively used to support of its head-office’s mixed supplies, and a second, on general costs used to support both establishment’s supplies. The significance of this judgment should not be overlooked for taxable persons active in the insurance, financial and other exempt sectors and established in more than one Member State. In this article, the author considers previous CJEU’s judgments that have contributed to shape the issue of deductible proportion in cross-border scenarios, analyses the Morgan Stanley judgment and addresses theoretical and practical difficulties that arise.
The EU Blacklist: A Step Forward but Still Much to Do
Authors: Melis Giuseppe
Published: March 2022

In 2016 the EU decided to adopt an EU blacklist of non-cooperative third country jurisdictions with the view of establishing a common approach of EU Member States in this area. This constitutes a first and positive step towards a deeper coordination of EU tax systems in the highly-sensitive area of identification of tax havens. However, further coordination through an institutionalized tax coordination process seems to be desirable, also in order to increase the transparency of the negotiating process between EU institutions and non-cooperative jurisdictions. A further step in the EU tax coordination process should regard tax competition measures having a general scope of application adopted by EU Member States: some arguments in order to contrast these regimes could be derived from international provisions adopted at UN level and, more specifically, from Art. 2, para. 1 of the International Covenant on Economic, Social and Cultural Rights.
Special Tax Zones and Proportionality: A New Parameter for the Necessity Test
Authors: Cipollini Claudio
Published: March 2022

The judgement of proportionality under the variables of fundamental freedoms and State aid rules is a process that often fails to promote legal certainty with respect to the necessity test, especially when the review involves tax measures of a Special Tax Zone (STZ).

The central idea of this article suggests the possibility of a new parameter for the necessity of territorial tax measures in order to limit the discretionality of the EU institutions and contribute in terms of legal certainty.

For this purpose, the concept of ‘fiscal residue’ is presented, giving evidence of its possible implementations in the context of STZs as an objective parameter for the necessity test, for both fundamental freedoms and State aid rules.

The discussion of the results covers the EU law and national law perspectives as well as the possibility of a system of EU governance for the use of the fiscal residue with respect to STZs.

Finally, the new outlook of the necessity test is focused on the equalization of the fiscal residue, opening doors for a more comprehensive idea of European Union, including the value of social cohesion at the territorial level.

Special tax zones, EU tax law, Territorial tax incentives, Fundamental freedoms, Regional fiscal aid, Proportionality, Necessity test, Least restrictive alternative, Fiscal residue, Horizontal fiscal balance, Fiscal equalization
Tax Abuse and Legal Pluralism: Towards Concrete Solutions Leading to Coordination Between International Tax Treaty Law and EU Tax Law
Authors: De Pietro Carla
Published: March 2022

As will be demonstrated in this article, the concepts of abuse adopted at EU and OECD level do not coincide completely.

As a result of these differences, conflicts may concretely arise between the EU and international obligations held by the same EU Member State. Furthermore, due to legal pluralism (i.e. the fact that each legal system, in principle, is developed and, therefore, functions autonomously on a global level) very often, in case of conflict, different conflict rules will be applicable, without the possibility of guaranteeing coordination between international tax treaty law and EU tax law.

In the absence of common coercive solutions, the author argues that coordination between international tax treaty law and EU tax law requires a dialectical approach through which conflicts can be managed. Therefore, conflicts become an opportunity for discussion and negotiation in order to pursue – step-by-step – solutions conciliating the international and the EU tax systems. Indeed, the achievement of complete coordination could not be immediate, but require intermediate steps. Any dialectical approach requires phases of compromise. This is implicit in the concept of managing conflicts on which legal pluralism is based.

Tax Abuse, Legal Pluralism, Coordination, tax treaties, EU law, conflict rules, double taxation, fundamental freedoms, artificial arrangement, proportionality, legal certainty, dialectical approach, PPT rule
VAT Deduction: The Relevance of Being ‘The Recipient’ of a Supply and the Use of the Supply
Authors: Bijl Jeroen
Published: March 2022

In this article, the author scrutinizes the current state of CJEU case law about VAT deduction on the purchase of goods and services by businesses, where third parties (also) benefit from these purchases. He also discusses case law about the VAT consequences of business funding transactions between two unrelated parties, where they have a financial interest in funding those transactions because they can lead to, for example, an increase of the turnover generated with their own taxed activities. The author comes to the conclusion that under the current provisions of the EU VAT Directive and CJEU case law, VAT deduction is not always allowed where, based on the principles of neutrality and economic reality, it should. He also offers a suggestion for adjusting the current rules in order to solve the issues that were highlighted in this article.

EU VAT, Deduction, Benefit, Third-party-payments, Economic activities, Neutrality, Business promotions, Necessary costs
BEPS Developments in Direct Taxes in Light of the EU VAT Treatment of Shareholding and Financing Activities
Authors: Velthoven Max , Zeegers Michel
Published: March 2022

In the Base Erosion and Profit Shifting (BEPS) era, direct taxes such as corporate income tax and withholding tax increasingly require taxpayers to align shareholding and financing activities with economic reality. As a result, it is expected that such activities will more often be performed by entities that also have ‘regular’ operating activities. For VAT, shareholding activities may be considered noneconomic activities and financing activities are typically exempt from VAT, with both activities therefore potentially leading to a limitation of the input VAT recovery right. As entities with regular operating activities are expected to incur more costs (which may be subject to VAT), any VAT recovery limitation resulting from non-economic or VAT exempt activities may have more impact for such entities. The shift towards economic reality in direct taxes can therefore lead to an increase in irrecoverable VAT. This article discusses the treatment of shareholding and financing activities under the EU VAT Directive in light of current developments in direct taxes such as the OECD BEPS project and the ‘Danish cases’ issued by the Court of Justice of the European Union (CJEU). The authors use an example of a multinational group to illustrate that developments in direct taxes may indirectly lead to adverse VAT consequences. The article provides taxpayers, their advisors, and policy makers with recommendations from a VAT perspective in light of the changes in direct taxes. The authors also recommend that the interaction between direct taxes and VAT receives more attention in the legislative process, especially in the context of further European harmonization.

VAT, BEPS, anti-abuse, VAT recovery, economic reality, PPT, Multilateral Instrument, Danish cases, economic activity, Brexit
Is There a Special Enforced Tax Collection Regime Under the ECtHR Case Law?
Authors: Bahceci Baris
Published: March 2022

This article examines the extent to which the European Court of Human Rights (ECtHR) takes into account the privileged nature of tax claims in enforced collection proceedings. Conducted within the framework of the right to property, the aim is to find a response to this question: Does the ECtHR case law allow for a special regime in enforced debt collection proceedings? A definitive answer to such a question requires a comparison between Court judgments on tax debts and non-tax debts. Under both the lawfulness and legitimate aims tests, no distinction appears between these two types of debt. On the other hand, under the proportionality test, the Court generally grants a wide margin of appreciation to States Parties. In this respect, two different dimensions are encountered, namely, the tax collector versus tax debtor and the tax collector versus other creditors. While the ECtHR does not allow differences between the collection regimes of non-tax debts in the former relationship, it appears that in the latter, the Court maintains the privileged status granted to the tax collector in domestic law. However, this privileged status is not unique to tax debts. Therefore, the article concludes that there is no special status for the tax debt enforcement regime under a comparison with non-tax debts.

Tax information reporting, Digital platform, Sharing economy, Gig economy, OECD, European Commission
The Development of the Doctrine of Abuse of Law and the Danish Cases: Time to Shift the Focus from Non-Genuine Arrangements to Single (Abusive) Transactions?
Authors: Cannas Francesco , Ballancin Andrea
Published: March 2022

The article first retraces the history of the standards adopted under the EU abuse of law doctrine to identify abusive conduct executed by the taxpayer. Then, the authors progress from the differences between the rules contained in the Anti-Tax Avoidance Directive (ATAD) and the findings of the CJEU in the Danish Cases, which constitute the last steps of that history, and elaborate on some proposals in order to update the former in light of the judges’ findings. They propose shifting the focus from non-genuine arrangements to single (potentially abusive) transactions, also taking into consideration the criteria relied upon in transfer pricing and controlled foreign company (CFC) legislation to ascertain whether economic substance is present.

abuse of law, ATAD, Danish Cases, GAAR, arrangement, transaction, fundamental freedoms, genuinity, artificiality, transfer pricing.
Cloaking Member State Objectives Through Legislative Instruments
Authors: Deák Dániel
Published: March 2022

This contribution discusses special sectoral taxes and analyses the CJEU judgments that have been made on their compatibility with the EU law. These taxes have aroused particular attention because they are levied on sales with progressive rates. As they mainly affect large businesses owned by non-domestic persons, the European Commission took action against suspected illegal state aid. The Commission has still failed to defend its position before the EU judicial authorities.

The literature has extensively criticized the CJEU-judgments. To date, however, no author has argued that Member States’measures leading to covert state aid and indirect discrimination are a consequence of the populist state’s abuse of power and that abuses are closely linked to the decline of political democracy and the rule of law in these jurisdictions. As things stand today, the EU legal instruments have not sufficiently unveiled the type of abuse. The present paper seeks to explain how the Member States could commit abuses of taxation power when applying special sectoral taxes.

progressive sales taxes, tax harmonization, distributive justice, selectivity, reference framework, covert state aid, indirect discrimination, abuse of power, cloaking Member State objectives, seemingly objective legal criteria
Non-Adversarial Mediation
Authors: Hill Richard
Published: March 2022

“That war is an evil is something that we all know, and it could be pointless to go on cataloguing all the disadvantages involved in it. No one is forced into war by ignorance, nor, if he thinks he will gain from it, is kept out of it by fear, The fact is that one side thinks that the profits to be won outweigh the risks to be incurred, and the other side is ready to face danger rather than accept an immediate loss.”

Thucydides, circa 400 B.C.
Precedent in Investment Treaty Arbitration—A Citation Analysis of a Developing Jurisprudence
Authors: Commission Jeffery P.
Published: March 2022

While there is no doctrine of stare decisis or binding precedents in international law, the development of an investment treaty case law or jurisprudence is unmistakable, and has not gone unnoticed in recent times, by treaty tribunals, and by those appearing before them. As such, international investment law now effectively develops through this mounting case-law, rendering the precedential value of each decision, award and order, rightly or wrongly, tremendously significant. A review of the decisions, awards and orders rendered by these tribunals, with a view to examine the sources of law cited in their decisions, is now both appropriate and warranted. This article presents a quantitative and qualitative citation analysis of this case law, surveying and reviewing the role that precedent has played in the 207 publicly available decisions, awards, and orders rendered since 1972, including decisions rendered by early ICSID tribunals (where jurisdiction was not predicated on consent in an investment treaty), and ICSID, ICSID (AF), and certain non-ICSID investment treaty tribunals.
Procedural Guarantees of Human Rights in Arbitration Proceedings—A Still Unsettled Problem?
Authors: Jaksic Aleksandar
Published: March 2022

A presistent question exists about whether human rights guarantees should be applied to voluntary arbitration. Opponents give no dogmatic grounds for non-applicability of Article 6(1) of the European Convention on Human Rights (“ECHR”) to voluntary arbitration. Moreover, recent developments in case law in various jurisdictions demonstrate a clear departure from the so-called waiver theory. The conclusion of an arbitration agreement does not signify a waiver from the procedural guarantees enshrined in Article 6(1) of ECHR. The direct appplicability of Convention’s provisions in arbitration proceedings does not harm the arbitral process, however. On the contrary, it appears to be useful, because it removes the respect for procedural guarantees from the phase of control over the arbitral award to the very stage of conducting the arbitration proceedings.
The Compétence-Compétence Principle, Revisited
Authors: González de Cossío Francisco
Published: March 2022

Recently the Mexican and U.S. Supreme Courts issued judgments that impact upon the understanding and scope of one of the most important principles of arbitration law: compétence-compétence. In essence, the view adopted by both Supreme Courts is that, whilst the arbitrator has the authority to rule on its jurisdiction, this authority is confined to challenges involving the validity of the contract as a whole. Should the challenge involve the validity of the arbitration agreement, it will be for the national courts to rule on the same. Interestingly, both cases display an impressive parallelism: not only in outcome, but in reasoning and other procedural aspects. This article addresses this development and concludes that it is mistaken. In the author’s opinion the new theory misconstrues the purposes of compétence and produces law that curtails the effects the principle was originally designed to yield.
Do Investment Treaties Chill Unilateral State Regulation to Mitigate Climate Change?
Authors: Schill Stephan W.
Published: March 2022

Mitigating climate change by reducing greenhouse gas emissions is one of the premier challenges to the international community. With multilateral approaches continuing to fail, states could possibly resort to unilateral regulation that limits emissions within their territory or bans the use and production of particular products. To the extent this affects foreign investors, the question arises whether investment treaties chill or even obstruct such unilateral action because it violates investment law concepts, such as indirect expropriation or fair and equitable treatment. This note therefore assesses the interaction between international investment law and unilateralism that endeavors to mitigate the effects of climate change. It concludes that, contrary to an often voiced concern, investment treaties do not lead to a regulatory chill in this context.
Investor-State Arbitration Under ICSID: A Case for Presumption Against Confidentiality?
Authors: Egonu Mabel I.
Published: March 2022

One of the main advantages of arbitrations is confidentiality. The private nature of the arbitral proceedings implies confidentiality and is thus one of the reasons why arbitration is preferred over other dispute resolution processes for the resolution of commercial and investment disputes. However, the issue of confidentiality has been called into question in the case of investor-state arbitration. Given that the matters raised in investor-state arbitration are usually of interest to the public, there have been calls for such proceedings to be more open and transparent. The aim of this article is to determine whether, in light of the recent amendments to the ICSID Arbitration Rules, transparency and public involvement can be presumed to now be the underlying theme in investor-state arbitration under ICSID. The article examines the background to investor-state arbitration under ICSID and looks at how the issue of confidentiality is treated in the ICSID Convention, the ICSID Rules, and cases. It then analyses the arguments for and against confidentiality. The article concludes that the emphasis should be on balancing the conflicting demands for confidentiality on the one hand, and the public’s interest in greater transparency and involvement in such arbitrations on the other.
Bridging the Gap Between Western and Chinese Arbitration Systems A Practical Introduction for Businesses
Authors: Johnston Graeme
Published: March 2022

For good reasons, arbitration is the preferred process for resolving Sino-foreign commercial disputes. However, Chinese arbitration law and practice vary significantly from modern Western norms. Unwary non-Chinese businesses often run into serious trouble by including void or inappropriate arbitration clauses in their China-related contracts. This article seeks to provide a practical guide to the most important topics which tend to cause problems: (i) the scope which Chinese law gives for businesses to arbitrate offshore, (ii) what the Chinese onshore arbitration experience is really like and (iii) the possibilities which exist for varying the standard onshore arbitration experience with a view to making it closer to that typically found in leading arbitration centres.
ICSID and BIT Arbitrations and China
Authors: Rooney Kim M.
Published: March 2022

The Peoples’ Republic of China is second only to Germany in the number of bilateral investment treaties that it has entered into, although there is no public record of international arbitration ever having been instituted against China. After outlining the substantive protections generally afforded by investment treaties and describing the nature of ICSID Arbitration, this article provides an overview of the investment treaties entered into by China since 1982 focusing on the evolution of the scope of disputes that may be submitted to international arbitration and discussing current issues concerning jurisdiction and enforcement.
Online Arbitration
Authors: Kallel Sami
Published: March 2022

This article provides an overview of online arbitration. It considers some of the distinct features of online arbitration as compared to traditional arbitration. If then discusses online arbitration in practice. The article concludes by examining some of the reasons why online arbitration has yet to prove attracting to many internet users.
Two Steps Forward, One Step ... Sideways — Recent Developments in Arbitration in China
Authors: Pé Robert S
Published: March 2022

During the last two decades, the number of arbitrations in Mainland China, including arbitrations involving foreign entities investing in the Mainland, has increased dramatically. The growth continued in 2007 when CIETAC administered 1118 cases (up from 981 in 2006). The number of arbitrations administered by the Hong Kong International Arbitration Centre also continues to grow and many of those arbitrations arise from transactions in the Mainland. This article discusses some significant developments for arbitration in the Mainland, including an extension of the limitation period for enforcement of arbitral awards and a new arrangement between Macau and the Mainland for the mutual recognition and enforcement of arbitral awards. This article also considers the broader implications of these developments and what is behind them. There were several developments in arbitration in China in late 2007 and there will be others in early 2008. This article considers a few of the most significant.
The Private Dimension of the International Customary Nature of Commercial Arbitration
Authors: Bantekas Ilias
Published: March 2022

While it is true that only states are capable of sanctioning rules of customary international law, little attention has been given to the formulation of some rules by private actors prior to official sanctioning. In the sphere of commercial arbitration, states may dictate the general framework, but are generally unable and at times reluctant to involve themselves in the shaping of industrial or commercial practices. As a result, states either ratify commercial customs by ascribing to them normative validity through the courts or by reference to a general law, without naming any particular practice. In this manner, the commercial practice becomes the practice of the state validating it, whether as usus or opinio juris and consequently binds the state in its future relations. Equally, where commercial practice is validated by more than one state, it assumes a transnational character and enters the realm of either global or regional customary international law.
“Back to the Future” for Investor–State Arbitrations: Revising Rules in Australia and Japan to Meet Public Interests
Authors: Miles Kate , Nottage Luke
Published: March 2022

The more things change, the more some stay the same. This article first highlights renewed concerns about delays and, especially, costs in international commercial arbitration (ICA). Many now urge quite radical solutions to make ICA more efficient, including allowing parties to authorize arbitrators to facilitate settlement (Arb–Med). At the same time, there are growing calls for more transparency, non–party participation, and other rule changes to promote the legitimacy of the burgeoning field of investor–state arbitration (ISA). Such reforms are justified by the greater variety of public interests involved in ISA, despite some possible losses in efficiency. We should resist a tendency simply to extend the solutions devised or proposed for ICA, particularly in the form of Rules of arbitral institutions, to contemporary ISA.However, some reforms incorporating proper safeguards may also be advisable in both fields, such as Arb–Med processes, or arbitrator remuneration providing better incentives to streamline proceedings. Many reforms can be implemented by institutions devising tailored ISA Rules, to be added as options for investors in bilateral or regional investment treaties or Free Trade Agreements (FTAs). Our article therefore proposes a variety of improvements. These are based on comparisons of the main Rules adopted for ISA (ICSID and the UNCITRAL Rules), the arbitration Rules of institutions like the Australian Centre for International Commercial Arbitration (ACICA) and the Japan Commercial Arbitration Association ( JCAA), and some of the provisions already found in Australia’s FTAs or governing trade disputes under the World Trade Organization (WTO) system. Hopefully, these improvements will enable ISA to keep developing through bilateral initiatives such as the proposed Australia–Japan FTA, emerging regional initiatives, and ultimately a new multilateral framework for investment. Although reforms are currently needed to bolster the legitimacy of ISA, longer–term reforms may instead re–emphasize efficiency, rather like ICA has done after decades spent achieving global acceptance.
Overcoming Immunity–Based Objections to the Recognition and Enforcement in Canada of Investor–State Awards
Authors: Bachand Frédéric
Published: March 2022

Canada’s State Immunity Act is problematic in that it does not clearly prevent foreign states from raising pleas of jurisdictional immunity to defeat applications seeking the recognition and enforcement of arbitral awards made against them. Worst, the Act can even be interpreted as allowing foreign states to raise such pleas to avoid obligations arising out of international awards. In this respect, Canadian law is clearly out of step with the law in force in jurisdictions that can truly be said to be wholehearted supporters of the international arbitration system, where such pleas are, quite rightly, unambiguously forbidden. While ideally the problem would be addressed through a legislative amendment, this article contends that it can be addressed through a dynamic and contextual interpretation of the Act’s provisions relating to the waiver exception.
With Arbitrators, Less Can be More: Why the Conventional Wisdom on the Benefits of having Three Arbitrators may be Overrated
Authors: Kirby Jennifer
Published: March 2022

That there is a general preference for three-member tribunals in international arbitration cannot be gainsaid. Conventional wisdom has it that having three arbitrators as opposed to only one helps to improve the quality of the proceedings and the ultimate award, and increases party confidence in the arbitral process. This article examines the conventional wisdom on the benefits of having three arbitrators, and specifically questions whether having party-nominated co-arbitrators generally improves quality or reasonably increases party confidence. The article also proposes ways in which party-nominated co-arbitrators might be selected to better serve both the tribunals on which they sit and the parties that nominate them.
Compensation for Moral Damages in Investor-State Arbitration Disputes
Authors: Dumberry Patrick
Published: March 2022

This article examines the issue of monetary compensation awarded by arbitral tribunals for moral damages suffered by foreign investors in the context of investor–state arbitration. It examines the nature and the function of moral damages in international investment law as well as several controversial issues, including the proper form of reparation to remediate moral damages suffered by a state, whether proof of malicious intent is a necessary condition for a tribunal to award compensation and whether compensation should be limited to cases involving “egregious” or grave treaty violations. The article argues that particularly condemnable governmental actions toward foreign investors will have a bearing on the actual quantification of the amount of compensation to be awarded for moral damages. The goal is not only to remediate the actual damage suffered but also to send a “clear message” to the host state.

“La réparation morale contient un élément de châtiment”

Hersch Lauterpacht
Peeking Through the Form of Uniform Law: International Arbitration Practice and Legal Harmonization
Authors: Gélinas Fabien
Published: March 2022

When judged by the sheer amount of scholarly literature to which it has given rise, uniform law, taken broadly here to include all forms of interjurisdictional legal harmonization, is a vast subject. To a significant extent, however, this fascinating subject presents but an academic interest. That is because efforts toward legal harmonization and the incorporation of uniform law have remained in vain in many areas. Not so in respect of arbitration, the practice of which has seen spectacular growth in the context of international trade and commerce over the past twenty-five years. This article looks at the incorporation of uniform arbitration law both in its formal and informal manifestations. An overview of incorporation through procedural and substantive instruments is first provided with reference to Canadian arbitration laws. Drawing insights from a multidisciplinary look at the concept of “praxis” and the teachings of Lon Fuller, the article then looks at the status of arbitration practice vis-à-vis arbitration law and its incorporation, emphasizing the respective roles of experts and courts.
LCIA India: Will It Change the International Arbitration Scene in India?
Authors: Zaiwalla Sarosh
Published: March 2022

Recently, the London Court of International Arbitration (LCIA) established LCIA India. Although LCIA India bears the name of its parent body in London, one hopes it is intended to be an Indian institution, of course with the support of LCIA London. This is a welcome development for the international business community in general and India in particular, as it is hoped that LCIA India will maintain a very high international standard in its awards. This in turn will encourage the Indian courts to have confidence in the awards published under the aegis of this institution. In order to consider whether the LCIA Rules will able to achieve this noble objective it is necessary to consider the background of international arbitration in India and the role of the Indian judiciary in relation to it.
Why South Africa Should Update Its International Arbitration Legislation — An Appeal from the International Arbitration Community for Legal Reform in South Africa
Authors: Wilske Stephan
Published: March 2022

The 2010 FIFA World Cup has stirred renewed interest in South Africa as a potential international trade and investment partner and in the country’s ability and readiness to host international arbitrations. In light of the global movement toward the modernization of arbitration laws, South Africa seems to be lagging behind other developing countries which are eagerly reaping the benefits that come with being a place of arbitration. Despite the fact that South Africa is Africa’s economic powerhouse, it is neglected as a place of arbitration. This article examines why this is so, noting in particular that South Africa’s main arbitration laws are perceived as “outdated” and “inadequate,” which discourage parties from choosing South Africa as a place of arbitration. In particular, the article shows that the South African Arbitration Act (SAAA) of 1965 gives excessive discretionary powers to local courts, allowing them to obstruct the arbitration process, and that subsequent legislation fails to give adequate effect to the New York Convention. In acknowledging recent developments that reaffirm arbitration as a means of dispute resolution in South Africa, the article concludes with a call for legal reform in this field of law beyond the efforts already made by the South African Law Commission.
Arbitration Costs as Relief and/or Damages
Authors: Rosell José
Published: March 2022

During the arbitration proceedings, two categories of costs may be incurred by the parties. The arbitration costs, which are strictly related to the arbitration proceedings, and the costs which are incurred in relation to parallel proceedings brought before the state courts by the parties. This article discusses the extent to which the costs of arbitration and of such parallel proceedings can be claimed, whether as an item of relief or as damages. The conduct of the parties during the proceedings may have an impact on the allocation of all such costs in both commercial and investor-state arbitrations.
Polimaster Ltd. v. RAE Systems, Inc.: My Place or Yours? But Not Both
Authors: Stein Erica
Published: March 2022

In Polimaster Ltd. v. RAE Systems, Inc., the U.S. Court of Appeals for the Ninth Circuit decided that an arbitral award rendered in the United States should not be confirmed under the Federal Arbitration Act. The court's opinion highlights the troubles that can arise when courts must analyze arbitration clauses that are more complicated than they need to be.
Dallah : Conflicting Judgments from the U.K. Supreme Court and the Paris Cour dAppel
Authors: Grierson Jacob , Taok Mireille
Published: March 2022

In Dallah v. Pakistan, the English and French courts reached contradictory views on the enforceability of an award rendered against the Government of Pakistan: the English courts held that an ICC tribunal sitting in Paris had been wrong to assume jurisdiction over the Government of Pakistan, a non-signatory of the relevant arbitration agreement; the Cour d'appel de Paris, by contrast, upheld the arbitral tribunal's finding that it had jurisdiction. This is despite the fact that the English and French courts all sought to apply French law to this question. This article examines the reasons for these contradictory views, including the fundamentally different legal cultures of England and France.
Harmonization and Delocalization of International Commercial Arbitration
Authors: Brazil-David Renata
Published: March 2022

This article focuses on the tension between the freedom of the parties to arbitrate and resolve their differences away from the constraints of national courts and the required jurisdictional underpinning that gives arbitral awards their certainty and legally binding character. It considers the current level of harmonization achieved in international commercial arbitration and the feasibility of the delocalization theory.
Enforcement of Arbitral Awards Annulled in Russia  Case Comment on Dutch Supreme Court of 25 June 2010
Authors: Van Den Berg Albert Jan
Published: March 2022

By a decision dated 28 April 2009, the Court of Appeal in Amsterdam granted enforcement of four arbitral awards annulled by the Russian courts under the New York Convention of 1958. The Dutch Supreme Court declared the recourse against the Court of Appeal decision inadmissible. The Supreme Court on 25 June 2010 opined that such a recourse would violate Article III of the New York Convention since it would impose a more onerous condition on the enforcement of Convention awards than on domestic (Dutch) awards. In the author's opinion, the Supreme Court's reasoning is at odds with both the New York Convention and Dutch arbitration law.
Finality and Arbitral Rules: Saying an Award Is Final Does Not Necessarily Make It So
Authors: Kirby Jennifer
Published: March 2022

Most arbitral rules provide for the finality of arbitral awards. Whether these provisions actually deliver what they promise is another matter. The degree to which arbitration is final often depends more on the law at the place of arbitration and in other countries where parties seek recognition and enforcement of the award.