It acknowledged that the ICSID framework is silent as to mass proceedings, but found that it would run counter to the purpose of the Italy-Argentina [bilateral investment treaty] and to the spirit of ICSID to interpret such silence as a prohibition on mass proceedings. ...-- Professor Karen Halvorsen Cross (right) of Chicago's John Marshall Law School, in an ASIL Insight entitled "Investment Arbitration Panel Upholds Jurisdiction to Hear Mass Bondholder Claims against Argentina." She details the "remarkable jurisdictional findings" in the August 2011 decision in Abaclat, a matter heard by a 3-member arbitral tribunal of ICSID, the International Centre for the Settlement of Investment Disputes. The reasoning of the 2 panel members in Abaclat differed, Cross explained, from that of the 5-Justice majority in Stolt-Nielsen SA v. AnimalFeeds Int’l Corp. (U.S. 2010), "that 'the differences between bilateral and class-action arbitration are too great for arbitrators to presume . . . that the parties’ mere silence on the issue . . . constitutes consent to resolve their disputes in class proceedings.'" Dissenting from his colleagues' contrary conclusion was arbitrator Georges Abi-Saab; he subsequently resigned from the Abaclat tribunal. The effects of the August decision, on the matter at hand as well as on other arbitrations raising similar issues of small claims and large sovereign debts, thus remain to be seen.
The tribunal’s findings can be contrasted with the approach the U.S. Supreme Court has taken to this issue in the commercial arbitration context.
Saturday, January 7, 2012
(Taking context-optional note of thought-provoking quotes)