Originally from: Between East and West: Essays in Honour of Ulf Franke - Hardcover
Between East and West: Essays in Honour of Ulf Franke - Electronic
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Corruption in International Investment Arbitration: Jurisdiction and the Unclean Hands Doctrine
Richard Kreindler
What may be the legal consequences in the investment treaty
arbitration context of proven corruption, particularly bribery, on the
determination of whether the arbitral tribunal has jurisdiction? Do the
proven “unclean hands” of the claimant investor necessarily lead to the
absence of jurisdiction or admissibility? Do the proven “unclean hands” of
the respondent host State alter the analysis? While every case will of
course depend upon the specific circumstances, whether considered as an
issue of the merits or as a preliminary pre-merits issue certain general
observations can be made.
I. BRIBERY UNDER INTERNATIONAL LAW
In order to address the legal consequences of alleged or proven
bribery with respect to jurisdiction in investment treaty arbitrations, one
must first ask whether bribery offends international law, as the legal
standard applicable, e.g., pursuant to the ICSID Convention or the Energy
Charter Treaty (ECT).
There can be little doubt that bribery offends customary international
law and general principles of law respectively. Customary law and
general principles of law form part of the corpus of international law
pursuant to Article 38(1) of the ICJ Statute. This is evidenced by a wide
range of international conventions, which condemn and interdict bribery,
as well as the national laws of various States. Thus, a number of
instruments negotiated, signed, and ratified under the aegis of the
Organization for Economic Co-operation and Development (OECD)
have the express aim and purpose of prohibiting acts constituting
bribery.
About the Author:
Prof. Dr. Richard H. Kreindler is a Partner of Shearman & Sterling LLP in Frankfurt. He is a member of the New York and Paris Bars. He is an Honorary Professor of Law at the University of Münster, Germany. He is a graduate of Harvard, Munich, Columbia and Münster.
