Author: Vanessa S.W. Tsang*
Published: March 2022
States as Parties
At present, whether implied confidentiality exists in investment treaty arbitration in the absence of an express and clear indication from any source remains debatable. In this light, this note examines the arguments from both sides and explores whether the finding of implied confidentiality in investment arbitration is desirable. It argues that confidentiality does not play the same role in investment arbitration as it does in international commercial arbitration. The finding of implied confidentiality is also problematic and undesirable. Mainly, it is hard to find the basis of an implied confidentiality rule in international law. Furthermore, the public interests involved would add to the argument that transparency rather than confidentiality is a more desirable default in investment arbitration.
Confidentiality is a controversial topic in arbitration. Particularly, whether implied confidentiality exists in investment treaty arbitration in the absence of an express and clear indication from any source remains debatable. On the one hand, international tribunals deny a general obligation of confidentiality and acknowledge that transparency, rather than confidentiality, has a more significant role in investment arbitration. On the other hand, some have argued that investment arbitration is akin to international commercial arbitration, in which implied confidentiality should exist in investment arbitration as a matter of contract. In this light, this note examines the arguments from both sides and explores whether the finding of implied confidentiality in investment arbitration is desirable. It respectfully disagrees with Born and argues that implied confidentiality should not exist under international law. The fact that one of the parties is a sovereign State, and the frequency of investors using investor-State dispute settlement (ISDS) to challenge the host State’s administrative decisions add to the argument that public interest is the dominant consideration in determining the issue of confidentiality in investment treaty arbitration.
For the structure of this note, Part II addresses the urgency and need to discuss confidentiality in investment arbitration and the desirability of finding a default position on confidentiality, i.e., the ‘problemathique.’ Part III discusses the arguments peculiar to a finding of implied confidentiality in investment arbitration. Part IV refutes the arguments made in Part III and explains the position of this note on why implied confidentiality should not exist in investment arbitration. Part V concludes.
* Vanessa Tsang is the holder of an LL.M. degree from Columbia Law School, as well as a J.D. and Bachelor’s degree in Politics and Public Administration from the University of Hong Kong. She also formerly served as a Staff Editor of ARIA.