Transcript:

Intro: Hello and welcome to Arbitral Insights, a podcast series brought to you by our international arbitration practice lawyers here at Reed Smith. I'm Peter Rosher, Global Head of Reed Smith's International Arbitration Practice. I hope you enjoy the industry commentary, insights and anecdotes we share with you in the course of this series, wherever in the world you are. If you have any questions about any of the topics discussed, please do contact our speakers. And with that, let's get started. 

Gautam: Hello, everyone, and welcome back to our Spotlight On podcast series. And I'm delighted that our spotlight today is on Professor Yarik Kryvoi. Hello, Yarik. 

Yarik: Hi, Gautam. 

Gautam: It's really nice to see you. Yarik is a senior fellow at the British Institute of International and Comparative Law, and he's also a director at the Investment Treaty Forum and a very well-noted and well-regarded academic in the areas of public international law and associated areas. So it's a real pleasure to be doing this podcast with you, Yarik, and I look forward to our discussion. There's going to be a number of things that we're going to talk about, which I know our listeners will find very, very interesting, given your very, very interesting background and your areas of specialism. So thank you again for joining me, Yarik. 

Yarik: My pleasure. 

Gautam: So let me first of all ask you about your background and if you could tell our listeners a little bit about your background and what drew you to the areas of international arbitration and public law, which of course you specialize in and which you teach. 

Yarik: Yes, happy to talk about that So I've been in London for around 15 years of my life, so the last 15 years. And I first came here to work as an associate at one London-based law firm And prior to that I was based in Washington, D.C. where I also worked for another law firm doing primarily international arbitration work and going back prior to that Immediately prior to that I did an LLM at Harvard Law School, and prior to that, I was based in my home country, which is Belarus. So I was born in Belarus, I grew up there, but I did my first law degree actually in Russia. And after that, I also did degrees in England, in the Netherlands, and in the United States. So my path towards international arbitration was not very straightforward, because initially I was more interested in public international law, in international labor law, so more public side of public international law, if I may say so. But then I understood that there is not that much work for people who do just purely PIL. And if you want to work with international law issues, then you need to be a bit more of a generalist and be flexible and do commercial arbitration. And at some point, I discovered the area of investor-state arbitration, which is somewhere on the border between public international law and domestic law. So you have an interaction of domestic legal systems and public international law, important public policy issues are also decided in this context. And that was intellectually challenging, and that was also something quite sophisticated and quite new at that time. Even though I was in Washington, D.C., at that time, the area of ISDS was not as well-developed and as fancy as it is today. So that was sort of my reasoning why I wanted to explore more this area. And just before joining a law firm in Washington, D.C., I did a short clerkship. I worked as an extern law clerk for a judge on the U.S. Court of Appeals for the District of Columbia Circuit, which is quite an important court in the United States because it has jurisdiction over many disputes which involve public international law issues. And sometimes you hear about annulment proceedings or Guantanamo cases or whatever. So a very important case, a very important court, and I had a chance to work on some of PIL cases also within the context of domestic courts. And now I've been in London, as I mentioned, for a few years already, for, well, soon it will be two decades, and here I combine academic work, practical work, as well as other activities. I will be happy to discuss those later today. 

Gautam: Thank you very much, Yarik. Now, that's a very, very interesting background. You certainly studied in many countries. You worked in many countries. And, you know, I suppose this explains why you are so international in your outlook, in what you teach, and in your academic interests of research. And we'll come to that. And I'll certainly be following up with you on some of the points that you spoke about there, because I know they'll be of interest to our listeners, and they're certainly going to be of interest to me. So so let me ask you this next in the course of your journey so far which we've obviously ascertained is a very interesting one and a very international one who along that journey have been your biggest inspirations and who've given you your biggest guidance and your biggest mentorship to make you the person you are today, 

Yarik: Yeah, it's a good question. Because I started arbitration and investor state arbitration work fairly late in my career, so after I did my first PhD, the influence of people also so when I was doing my first law degree, I was not particularly focused on one area. So it was more generally international law and domestic law. But then once my focus has become more clear, I think already when I was doing my LLM at Harvard, at that time, arbitration was not even taught there. But there were some other areas of law which were very well taught. And for example, I was quite interested in law and economics classes. And it was possible to attend joint seminars of the Department of Economics of Harvard University and Harvard Law School, where they brought together students, or mostly LLM students and PhD students from Harvard and from these two departments of Harvard. And we discussed various areas and how to use law to regulate particular issues, a variety of topics, from damages to most efficient dispute resolution mechanisms. So this way of thinking about law as an instrument to deal with real-life issues, I think that was quite inspiring. And, for example, Andrei Schleifer, professor of economics, was there. And Louis Kaplow, who is professor of law and economics at Harvard Law School. So they certainly impacted me. Then when I worked for Judge Stephen Williams in Washington, D.C., the common law approach, the approach of judges to common law issues, understanding law, interpreting law, including public international law, had also great influence on me. I remember working on one case which involved. An archive of one Jewish group, which was confiscated by Russia at the beginning of the 20th century. And then this Jewish group was trying to sue the Russian Federation to get those documents back from Russian archives, and they relied on various international law concepts. And so it was possible to see how international law works in practice and how closely it's linked with politics and with history and Judge Williams at that time and he was a great mentor, unfortunately he passed away a few years ago and then i found my first job and partners who worked there Mark Bravin for example he used to work on the with the cases on the Iran-U.S. claims tribunals in early years of this tribunal and we had a case uh representing government of Romania in Roussalis vs Romania and I was in charge of preparing arguments on counterclaims. And it was still very novel at that time. Nothing has been written on counterclaims. So I had to come up with my own arguments. And then I published the first ever article on counterclaims in investor state issue settlement. And then when I moved to London, well, London is great when it comes to human capital and the number of people who are great experts in the area, particularly when I joined the British Institute of International and comparative law. We have a great advisory board. But actually, even before I joined, when I was interviewed for my job, I was interviewed by the then director of the institute, Robert McCorquodale, but also by Johnny Vida and by Audley Sheppard. Unfortunately, Johnny Vida passed away as well a few years ago, but I still remain in contact with Audley Sheppard, with other people on the advisory board, for example, Professor Andrea Bjorklund, with Robert Volterra and others. So we regularly were in touch to discuss events, discuss projects and so i feel very privileged to be able to work with with people of this sort of expertise and reputation 

Gautam: Well there's some great names there and some really big names there who you've mentioned and you know and you know no doubt been huge inspirations to you and you know and i think this is an area of law i can remember Yarik when i was a young law student many years ago, and it was many, many years ago. Of public international law wasn't really that well-known at all. And I'm thinking back to my first degree that I began in 1987, and I graduated in 1990. It really wasn't that well-known at all. And it's been amazing how over the years, it's become such a popular area, and there's so much academic research and study in these areas, and also the practice of ISDS arbitration, which of course we can, which we'll discuss because I've got some issues to ask you about on that, not least given a written article that you wrote. So there's a lot of really, I mean, it's been great to see the development of this area. So let me just ask you this as a follow on. You're obviously a very active academic and you teach very regularly on the areas of public international law. Tell us a little bit about the courses which you teach and what some of the key areas are that you consider we should be thinking of as important areas to watch in the area of public international law. 

Yarik: So at the British Institute of International Comparative Law, we do have teaching, but it's not really the teaching which you normally expect at universities. And I used to be a full-time law professor at a London-based university, and there I had many students and I had marking and so on. At BIICL, we do teaching, but it's primarily for government officials, for senior lawyers, for people who already have good understanding of law, who are usually qualified in one or more jurisdictions. But what our institute brings is focus on specific areas of international law, as well as international law more generally. For example, I teach on the public international law in practice course, which is, for some reason, it's very popular among government officials, not only the UK government, but also other governments. And what we do there, after the initial class of introducing the key concepts of international public law, such as state responsibility. Such as subjects of international law, jurisdiction, and so on, we then focus on specific areas of international law. For example, Investor State Dispute Settlement, the Law of Armed Conflict, International Trade Law, you name it. There's a significant number of those courses, of those classes. I think around 10 in total, where we zoom in on particular areas of law. And my particular area of law is Investor State Dispute Settlement. In addition, we recently started offering advanced workshops or masterclasses. And the first masterclass, which the Institute produces, will actually be delivered by me. It will be about corruption and international arbitration. I am involved in one study commissioned by the United Nations Office on Drugs and Crime, in which we try to understand the impact of corruption allegations on international arbitration and whether it's possible to use international arbitration as an instrument to promote anti-corruption treaties. For example, the United Nations Convention Against Corruption, which is one of the most widely ratified treaties in public international law. But for some reason, tribunals are not particularly keen to rely on this treaty, and perhaps the main explanation is that they're simply not familiar with this area of law, because most of arbitrators, be it in commercial arbitration or investor state arbitration, have background in commercial law, occasionally in public international law more generally, but not really in criminal law. So I think there is much to do in this particular area. Also, in addition to live classes, be they hybrid or in-person, I also created an online course or an Investor State District Settlement, which anyone can access at any time on the BIICL website. And again, for some reason, government lawyers are particularly interested in it. So you can take this course over the course of several weeks, which includes interviews with practitioners, lectures, quizzes, and so on. So I think that's one of promising ways to spread knowledge about international law is essentially to use technologies. And I think what we're doing now is also within these efforts to make international law more visible, to talk about practitioners. So podcasts, I also actually have a few podcasts which are integrated in this course. And when it comes to areas of international law, in addition to corruption and arbitration, which I already mentioned, I think sanctions become increasingly important because they involve interaction of domestic law, international law, they involve public policy issues, and you don't have anyone who can claim to be an expert on all sanctions in the world because each sanctions regime has its own limits and there are different jurisdictions with different laws. And that, I think, makes it important for lawyers from various jurisdictions to cooperate, to understand how to comply with particular regimes or, in some cases, how to challenge particular sanctions designations. So I think these two areas which kept me quite busy, and some of my work actually results from sanctions or from counter-sanctions. One of the jurisdictions in which I'm qualified is the Russian Federation, and I often act as a Russian law expert in various proceedings, for example, in aviation insurance litigation in various countries. And next week, I'm going to Chicago, actually, in one of those cases where I work with Reed Smith. So I think sanctions will continue to generate work not only for academics, but also for practitioners. 

Gautam: Absolutely. It's a really incredibly important area now, sanctions. I mean, everyone knows that it's constantly evolving and your expertise will certainly be very valuable, I know. And let me say, I hope you have a very nice trip to Chicago. I dare say you'll need to take a warm coat because I think the weather in Chicago now is getting a little cold. No, you mentioned in the course of what you said about your work in the area of investment treaty arbitration and corruption. And I read your article that you recently very kindly sent me, where I think this is part of your study that you're doing. And I think this is a very interesting area because one of the things that, because it's still quite a, it's an unknown area in many ways. There's a lot of things to be settled in this area. But I suppose one of the interesting angles in all of this is, amongst others, is what role should tribunals be taking to deal with corruption issues? I wonder if you could briefly give us your thoughts about what more you think the tribunals can be doing in this area. 

Yarik: That's a great question. And I think the first question here is whether tribunals should actually look at their own initiative into the possibility that corruption has occurred there. And traditionally, in commercial arbitration or even in investor state arbitration, and particularly in common law jurisdictions, tribunals are supposed to look at issues which were brought to them by the parties. So if someone is asking a particular legal question, they need to deal with this legal question. They don't need to go too far away from it because otherwise they could be outside of their mandate or they can be potentially jurisdictional challenges. Or someone will say all sorts of arguments which can be raised. On the other hand, we know that there are mandatory rules of law, be they domestic law or international law. And I think to address the question of whether tribunals should look themselves into corruption allegations or even to report corruption allegations to the relevant authorities, I think it's important to understand what law applies to that particular dispute. And very often, unfortunately, in the context of investor state arbitration, tribunals are not particularly pedantic let's say about applicable law they just explain their reasoning their logic and without relying on norms of law and they may rely on a treaty on a fairly vague provision let's say fair and equitable treatment and then they would explain how they understand this concept without really relying for example on domestic law and very often arbitrators are not experts in in a particular domestic law in the context of investor state arbitration. So if you look, for example, at those who were most frequently appointed as arbitrators, these are nationals of the United States, the United Kingdom, France, and Switzerland. I think there are also a fair number of Canadians there. But if you look at respondent states with legal systems of which those claims are usually most closely related, the vast majority of them are not from the United States, Switzerland, or the UK. They come from other jurisdictions, often with rather different legal cultures. So I think more respect to applicable domestic law is an important component of it. Plus, I think tribunals should be aware that international law is not aware, I think they are already aware, but they should in practice do more to reflect that international law is not only a relevant bilateral investment treaty. There are also other instruments which deal with corruption, which may deal with human rights, which may deal with jurisdictional immunities, with all sorts of issues. And I think it's important to be aware of it and to actually apply those standards. For example, the UN Convention Against Corruption is a rather detailed document, and there are also reports which are regularly published to see how states comply with this convention, how different provisions should be interpreted. So there is a wealth of evidence about how corruption-related norms can be implemented and should be implemented. And sometimes as a matter of law it's not even a choice whether tribunals want to do it or not sometimes they just must do it because as a result of application of mandatory rules of law so this is some of my thinking but if you're interested in knowing more then please read my publications. 

Gautam: Yeah yeah I’m very interested in fact I read your article with huge interest and I certainly would recommend to our listeners to look into your recent article on ISDS and corruption because it's an area that I don't think there's been much empirical work on before. And I certainly haven't seen much on the subject because often many cases, as you all know, Yarik, where the states get sued by the investor. Some of those cases tend to come out of alleged corruption by government officials, state officials. But actually there's another set of corruption which could also be very interesting. And, you know, your article is, I think, very instructive on that. So I would certainly encourage our listeners to look into that. I wonder if I could ask you one last question on ISDS before we sort of move to close out the podcast. And it's this, over the years, as I've observed and as you've observed, many observers will have seen this, ISDS, so Investor State Dispute Settlement, has in some ways lost a lot of faith amongst the states. And there are many reasons for that. And we don't have enough time in this podcast to go through all of those reasons. But you and I know that this has been an ongoing issue. Do you have any thoughts as to how everyone involved in ISDS can do more to bring more faith into the system and give more confidence in ISDS as a concept? Because it has suffered in its reputation over the years, and some states, as you know, are very skeptical about it. I wonder whether you could give your thoughts as to how the process might be made more attractive and give more confidence. 

Yarik: Sure and before I move into that if you're interested in empirical studies of various aspects of ISDS to see how actually ISDS works in practice I would recommend also checking the publications page of the Investment Treaty Forum because we did a number of studies on provisional measures on tax measures on cost duration and so i think working with numbers, working with real practice of tribunals is quite helpful. And also one of the reasons why it's helpful is because there is great inconsistency in the ISDS system, which is, I think, one of the main criticisms of the system. Because in domestic law, you more or less know that if there is some inconsistency, you can go to court and the court decides on this inconsistency. And then hopefully things become more consistent. Within the system of ISDS, each tribunal can come up with its own reasoning and if let's say it's an exit award and you can't really do anything about this award you can try annulment but annulment your chances of success are quite low and so you I think what worries many stakeholders and in the first place states is this inconsistency which also leads to high costs. It takes long because the issues are not settled so it's expensive it's long and also states, as I understand, many states think that ISDS is biased towards investors. And our institute is an observer at the UNCITRAL working group three. And I think these three issues, inconsistency, high costs and long duration and bias towards investors, are the main three points with which states are unhappy. And when it comes to what to do about it, well, indeed, many things can be said on this issue. What I think is that it's important to understand that if ISDS will be completely removed from the public international law landscape, I don't think it will happen, but let's imagine. Then what will happen is that investors and states will switch to commercial arbitration, which will be even less transparent. There will be less opportunities to reflect public interest, to make submissions, or to put pressure on stakeholders. I'm currently doing another study where I look at one aspect of corruption in the SDS, namely corruption in the SDS arising out of investor-state contracts. So not treaties, but contracts. And one striking thing is that the majority of those contract-based disputes come from African states, which have no sophisticated network of bilateral investment treaties. So that suggests that if you don't have treaties, if you don't have international law, then it will be national law, it will be less transparent, and I think there will be less opportunities to reform that sort of approach. And what else can be done? I think more respect to domestic law would be helpful. Also to show that it's not just three white guys in London who decide disputes, as I think one of Trump's officials described ISDS. It should be seen as more inclusive. And also I think some states are now switching from being just capital importing states to also capital exporting states. For example, India. In the past, you would only see it as capital importing country, but now you can see more and more investments coming out from India. The same can be said about China and about some other jurisdictions. So they may also think that at some point they may decide that it's important for them to protect the interests of their own investors to have some sort of stability and predictability, particularly in countries with a weak rule of law. Because if you don't have strong rule of law, then investors will just stay away from those countries and those countries will be hurt as a result. They will not benefit from technologies, from tax revenues, from other know-hows, various benefits which foreign direct investments can bring. 

Gautam: Thank you, Yarik. Fascinating. And this will continue to be a very sensitive area and one that we'll watch. I should have just mentioned for our listeners, and I know our listeners take much interest in the academic side of what we're discussing. For those of our listeners who are interested, and I would encourage you to look at this, the article which I mentioned, which Yarik and I were talking about on corruption, the name of the article is Corruption and Foreign Investments, Empirical Lessons from Treaties and Arbitration Cases. And that was an article published by Yarik in the International Journal of Constitutional Law, Volume 22, Issue 2, in April of 2024. So I would encourage you to look at that article. It's a very, very interesting one. I'm sure one that will be written about further by Yarik in the months and years to come. 

Yarik: Yeah, I should say that it was inspired by my work with the UN Office on Drugs and Crime. And hopefully next year we'll publish a much longer study looking at these issues. 

Gautam: Thank you. And I hope you'll send that to me too when you do it. 

Yarik: Will do. 

Gautam: Because I certainly find this a very fascinating area and one that we need to all keep up with. So, Yarik, thank you. I mean, you're an incredibly busy man. You've got many, many things that you do. But the one thing that I always like to do in these podcasts as we finish them is ask our guests a few non-legal, a few non-technical questions. Because at the end of the day, we're all human beings and we all have other interests. So let me just ask you apart from you know your extremely busy legal life what sort of things do you enjoy doing in your spare time? 

Yarik: Well there are two things which i think could be said to be unusual. The first one is that I did a second PhD and it was not in law but in education. So University College London has a program focusing on online education so i try to understand what makes legal education different from other areas and I implement some of findings from my study for my PhD project at the institute but also within arbitration lab which is an initiative a Swiss British initiative we where we promote international law internationally we organize a winter school and a summer school and a few other initiatives and we talk about really fascinating topics, for example, how to resolve disputes arising out of e-sports and gaming or blockchain-related arbitration and so on. But this is still, it sounds a little bit like work. And what is completely not related to law is my Judo practice. Just a few days ago, I got my brown belt in Judo. So it's one more step and then I'll be a black belt. And I find this sport quite interesting and rewarding as well because it keeps your body in a good shape. And also when I travel for work, I try to find a local Judo club, be it in Dublin or in the US or on the Canary Islands there would always be a Judo club and i could go there and and train there and and speak to people just to get a glimpse of what it what life is like in in those particular countries. I mean one sort of disadvantage is that sometimes when you come to a conference with a bruise under your eye you get too many questions so what what happened what really happened? 

Gautam: I’m sure. 

Yarik: But that's I guess the biggest inconvenience but otherwise, I would highly recommend this as something to completely switch off your mind from law and law-related work. 

Gautam: Well, I know that martial arts takes a lot of discipline. So that's a very good lesson for us all, because discipline is a very important thing in what we all do. So last question is this, Yarik. Do you have any particular favorite music that you enjoy listening to? 

Yarik: Well, if you look at what I have on my phone, then I have a huge collection of choral music, and boys' choirs, Vienna boys' choirs. I really like that. And also, on the other end of this music spectrum is a complete techno music, very energetic. There's a very different type of music, but I think they help me to get myself into a different mood when I'm driving or when I'm walking somewhere or during breaks. And actually, when I work on my computer, when the task is not super intellectually challenging, I also like to listen to Indian music. 

Gautam: Oh, right. 

Yarik: Bahjans, you know, the religious music? 

Gautam: Yes, yeah, the devotional songs, yes. 

Yarik: Yes, exactly, because they are so melodic, and they are not interfering with your thinking process and at the same time, they're inspirational in a way. So I like to have that music in the background when I work on my legal and other issues. 

Gautam: That's fascinating. No, that's fascinating, yes. Because as you can imagine, I was brought up listening to Bhajans and devotional songs. And I still do. Because it's part of my religious beliefs. So that's fascinating. I've learned many, many new things about you today. Which I must say have been amazing and thank you very very much for being such a superb guest. I really could have spent an hour talking to you about all of the things we've been talking about and some of the things we spoke about we barely dealt with because there's just so much to say but thank you again very much Yarik. I wish you all the very best and I look forward to seeing you in person very very soon. 

Yarik: Thank you very much Gautam. It was a pleasure. 

Outro: Arbitral Insights is a Reed Smith production. Our producers are Ali McCardell and Shannon Ryan. For more information about Reed Smith's global international arbitration practice, email arbitralinsights@reedsmith.com. To learn about the Reed Smith Arbitration Pricing Calculator, a first of its kind mobile app that forecasts the cost of arbitration around the world, search Arbitration Pricing Calculator on reedsmith.com or download for free through the Apple and Google Play app stores. You can find our podcast on podcast streaming platforms, reedsmith.com, and our social media accounts at Reed Smith LLP. 

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