Will the EU’s Proposal Concerning an Investment Court System for CETA and TTIP Lead to Enforceable Awards?—The Limits of Modifying the ICSID Convention and the Nature of Investment Arbitration

Both the November 2015 EU Commission proposal for Investment Protection and Resolution of Investment Disputes in the EU-US Transatlantic Trade and Investment Partnership (TTIP) as well as the revised February 2016 version of the Canada-EU Comprehensive Economic and Trade Agreement (CETA) contain an investment court system (ICS) which is a two-tier mechanism for investor-State dispute settlement (ISDS), combining elements of traditional investor-State arbitration (ISA) with judicial features. The resulting hybrid form of dispute settlement should be regarded as a permissible inter se modification of the ICSID Convention. Nevertheless, this will not ensure that the non-modifying ICSID Contracting Parties have to recognize and enforce ICS awards as ICSID awards pursuant to the specific rules of the ICSID Convention. Rather, they should be regarded as enforceable awards under the New York Convention. This latter result will ensure that the outcome of ICS dispute settlement will be enforceable not only in the respective Contracting Parties of TTIP and CETA, but also in other States parties to the New York Convention.