The Authority of Arbitration in Determining the Liability of Multiple Actors in Foreign Investment Corruption(مقاله علمی وزارت علوم)
حوزههای تخصصی:
The importance of investment and the necessity for its legality, alongside the occurrence ofcorruption due to the involvement of multiple actors in the investment process, render itsexamination - especially in arbitration - unavoidable. Corruption may manifest through foreigninvestors and pressures from their home states or affiliated intermediaries, taking the form ofbribery and collusion with domestic officials of the host state or through threats against them.Furthermore, the emergence of corruption may stem from structural weaknesses or corruption-laden processes within the host state’s system. At times, a combination of all the aforementionedfactors, alongside the involvement of third parties, can create a corrupt and illegal investmentprocess. Given the private nature of arbitration, the primary question arises: does an arbitraltribunal possess the jurisdiction and authority to examine and determine the liability of each ofthe aforementioned actors? Through an analytical and documentary investigation, this articleestablishes that, firstly, arbitral tribunals generally do not have the power to investigate criminalbehavior and related inquiries; secondly, due to secrecy and threats against witnesses, collectingand maintaining the security of evidence within the sovereign territory of the host state ischallenging; thirdly, ICSID tribunals often rely on the “balance of probabilities” and significantlyon “red flags” and reports from anti-corruption organizations. Fourthly, the consideration of theinitiating factor of corruption, the degree of influence of participating actors (the prevalenceof corruption in the host state and the level of the host state’s involvement in the occurrenceof corruption), as well as the circumstances of “duress” and “hostage” situations and thenature of the bribe (transactional / variance), may lead, depending on the case, to the completecondemnation of the investor ( and a finding that the investment is unjust) or a reduction ofliability or immunity for the host state.
