Foreign Investment Disputes Research Paper Example | Topics and Well Written Essays - 4000 words

Foreign Investment Disputes - Research Paper Example For the last two decades, increased technological and liberalization advances have resulted into increased growth in the flow of FDI. This means that FDI gained in share of domestic investment and GDP in many countries. It is done for numerous reasons that involve taking advantage of low cost wages or for exceptional investment privileges like rewards to obtain a link that is tariff-free towards the countries markets or the regional market through the use of tax holidays granted to the company. There are a several ad hoc arbitral rules and two arbitral institutions responsible for most of the arbitrated foreign investment disputes. The ICSID is the arbitral institution, which specifically deals with international investment disputes. The ICSID specifically deals with investment disputes. It has unique advantages. As an arbitrary institution, ICSID is an affiliate of foremost international lending institution and a division of world bank. It is enjoys the advantage of perception, where it is perceived that countries would always comply with the obligations of ICSID. ICSID is supported by the ICSID Convention, which is a multilateral treaty. This way, any violation an obligation of the ICSID is regarded as a treaty violation hence a violation of the international law. The ICSID center is responsible for administering three types of procedures: conciliation, binding arbitration and a fact finding procedure. The ICSID Convention states that whenever an arbitration procedure is adhered to, ICSID should be made an exclusive forum for any kind of dispute that is submitted to it. The annulment procedure that is provided before its second tribunal, is the recourse only against the ICSID award and no appeal regarding an award may be taken to any national court. Further, it provides that the host country can only enforce a final ICSID award but not any country, which is a party to ICSID convention. The ICSID Convention has special jurisdiction