State Succession and BITs: Challenges for Investment Arbitration – Vol. 27 No. 4

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Author: Raúl Pereira Fleury*

Published: May 2017

States as Parties
Investment Disputes
Challenge of Arbitrators

State succession has always been a complex and controversial subject. Its political nature makes it unpredictable in that it is not treated consistently by the international community. Such is its complexity that under customary international law, the matter is governed by two Conventions: the Vienna Convention on Succession of States in Respect of Treaties (“VCSST”) and the Vienna Convention on Succession of States in Respect of State Property, Archives, and Debts. And even with two conventions on the issue, it is still a battleground for opposing doctrinal views.

In the late 1980s and 1990s we have seen many cases where there was no common agreement on the law of State succession, especially with respect to the changes in Central and Eastern Europe, where we saw the dissolution of the USSR, Yugoslavia, and Czechoslovakia, and the unification of Germany. More recently, South Sudan’s secession from Sudan (2011) and Kosovo’s unilateral declaration of independence from Serbia (2008) brought back to the table the issue of State succession, the latter even provoking a ruling – in 2010 – of the International Court of Justice with respect of such unilateral declaration.

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*Senior Associate, Corporate and Arbitration groups at Ferrere Abogados, Paraguay; LL.M., American University Washington College of Law, International Arbitration and International Business Law (2015); J.D., Catholic University of Asunción, Paraguay (2012); The author is a former trainee with Shearman & Sterling’s International Arbitration Group in Paris. The author would like to thank Charles “Chip” Rosenberg for his insightful comments and feedback on earlier drafts of this article.