Having regard to the public availability of decisions and this flurry of activity, this chapter will focus on challenges to arbitrators (and committee members) brought under the ICSID Convention. The chapter begins by setting out the grounds for disqualification under the ICSID Convention and Rules, before briefly detailing the prevailing legal standard as developed through ICSID jurisprudence. The majority of this chapter will be devoted to a discussion of three categories of alleged conflict,2 concentrating on the reasoning of publicly available decisions published during 2018.
The Rules
The main grounds for disqualification of arbitrators under the ICSID Convention are prescribed by Article 57, which provides that:
[a] party may propose to a Commission or Tribunal the disqualification of any of its members on account of any fact indicating a manifest lack of the qualities required by paragraph (1) of Article 14. A party to arbitration proceedings may, in addition, propose the disqualification of an arbitrator on the ground that he was ineligible for appointment to the Tribunal under Section 2 of Chapter IV.
Reference to Section 2 of Chapter IV is to the nationality requirements for appointment under Articles 38 and 39 of the ICSID Convention. A third ground for disqualification is found in Rule 8 of the ICSID Arbitration Rules, which provides for a situation where an arbitrator becomes incapacitated or unable to perform the duties of his or her office.
The most commonly invoked ground for disqualification is a manifest lack of the qualities required by Article 14(1):
[p]ersons designated to serve on the Panels shall be persons of high moral character and recognized competence in the fields of law, commerce, industry or finance, who may be relied upon to exercise independent judgment. Competence in the field of law shall be of particular importance in the case of persons on the Panel of Arbitrators.
It is well settled that although the English text of Article 14(1) refers only to ‘independent judgment’, this provision also contains a requirement of ‘impartiality’ (deriving from the equally authentic Spanish text).
In practice, applications for disqualification under Article 14(1) are almost always premised on an alleged lack of independence or impartiality, and it is on these types of challenges that this chapter will focus.
To read the full article, please download the PDF.
- The ICSID website reports that there were a total of 10 disqualification proposals in 2018 (Available at icsid.worldbank.org)
- These categories have been selected on the basis of their recurrent appearance in the publicly available disqualification decisions from 2018.