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The European Journal of International Law Vol. 27 no. 1
EJIL (2016), Vol. 27 No. 1, 107–128 doi:10.1093/ejil/chw003
© The Author, 2016. Published by Oxford University Press on behalf of EJIL Ltd.
All rights reserved. For Permissions, please email: journals.permissions@oup.com
About the Order of Cart and
Horse, Among Other Things:
Estoppel in the Jurisprudence
of International Investment
Arbitration Tribunals
AndreasKulick*
Abstract
A quantitative and qualitative study of international investment arbitration case law employ-
ing the concept of estoppel reveals investment tribunals’ inconsistency with regard to the con-
cept’s requirements. This article discusses possible reasons why tribunals often deviate from
what appears to be the established view in the jurisprudence of the International Court of
Justice and in international law scholarship and why they do not explain their preference for
one view or the other. In fact, the often striking lack of reasoning in this respect begs the ques-
tion regarding the order of approach chosen and the outcome produced. In the interest of doc-
trinal and jurisprudential consistency, arbitrators should be more transparent with respect
to their choice of view and their reasons for choosing one over another. This will sharpen the
concept of estoppel both in international investment law, in particular, and in public interna-
tional law, in general.
1 Introduction: Different But Yet theSame?
Recourse to estoppel occurs frequently in international investment arbitration. Both
parties employ estoppel in order to prevent the other side from asserting a claim, be
it with regard to procedural matters, admissibility, jurisdiction, liability or quantum.
However, how do international investment tribunals decide, and do they decide con-
sistently? How do they dene the scope and requirements of the concept and why? Are
their decisions consistent with the jurisprudence of international courts and tribunals
* Senior Research Fellow, University of Tübingen, Germany. Email: andreasjkulick@yahoo.de. Iwish to
express my gratitude to Paula Lobeck and Paul von Mühlendahl for assistance with the quantitative
research and Isolde Zeiler for proof-reading the draft. Also, Ithank Geraldo Vidigal Neto and the European
Journal of International Law peer review readers for their very useful and thought-provoking comments.
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108 EJIL 27 (2016), 107–128
outside of international investment law? What legal reasoning, if any, do they pro-
vide? The frequency and prominence of estoppel claims in international investment
arbitration calls for a study on the matter.
If Asays X and does Y, the question is what B can do about it. Giving the adequate
legal response to inconsistent behaviour poses a challenge that is familiar to all legal
orders or régimes.1 International law has four doctrinal concepts to offer: recognition,
acquiescence, waiver and estoppel,2 which are all rooted in the principle of good faith
(bona des).3 Whether Aexplicitly recognizes that X is correct instead of Y, whether
she implicitly acknowledges that this is the case, whether she relinquishes her right
to claim Y instead of X or whether she makes representations to B that lead the latter
to assume that X is correct instead of Y, the consequence, at least de facto, is always
thesame.
However, with the consequence being the same for all four concepts, there is an
obvious dilemma. If a party may invoke a number of different doctrinal concepts for
the same effect, it will tend to reach only for the lowest-hanging fruit. This is particu-
larly obvious if, as is the case with the concepts of recognition, acquiescence, waiver
and estoppel, the requirements are overlapping. Thus, the concept that requires the
highest threshold runs the danger of becoming obsolete. In fact, in this case, why
bother distinguishing separate doctrinal concepts atall?
Nonetheless, despite their shared underlying rationale and despite triggering the
same consequences, recognition, acquiescence and waiver, on the one hand, and
estoppel, on the other hand, differ considerably in their doctrinal underpinnings.
Recognition, acquiescence and waiver are unilateral acts.4 Recognition is the explicit,
acquiescence the implicit, creation of an obligation by consent, whereas waiver is the
reversed image of the two – that is, the consent to give up a right that actually existed.5
By contrast, as James Crawford putsit:
1 See already H.Lauterpacht, Private Law Sources and Analogies of International Law (1927), at 203; North
Sea Continental Shelf Cases (Germany v.Denmark and Germany v.the Netherlands), Judgment, 20 February
1969, ICJ Reports (1969) 101, at 121, Separate Opinion of Judge Fouad Ammoun; Cottier and Müller,
‘Estoppel’, in R.Wolfrum (ed.), Max Planck Encyclopedia of International Law (2007), para. 9 (online).
2 See J.Crawford, Brownlie’s Principles of International Law (8th ed., 2012), at 421.
3 See N.M. Shaw, International Law (7th edn, 2014), at 372; B. Cheng, General Principles of Law as
Applied by International Courts and Tribunals (1953), at 141. See also generally P.-Y. Marro, Allgemeine
Rechtsgrundsätze des Völkerrechts (2010), at 246–253.
4 See Crawford, supra note 2, at 421–422; Lim, ‘Upholding Corrupt Investor’s Claims Against Complicit
or Compliant Host States: Where Angels Should Not Fear to Tread’, in K.P. Sauvant (ed.), Yearbook of
International Investment Law and Policy 2011/2012 (2012), at para. 130 (online); International Law
Commission (ILC), ‘Seventh Report of Special Rapporteur Victor Rodrígues Cedeño on Unilateral Acts
of States’, A/CN.4/542, in Yearbook of the International Law Commission, vol. 2 (2004), part 1, 207, at
250, para. 200; Goodman, ‘Acta Sunt Ser vanda? ARegime for Regulating the Unilateral Acts of States at
International Law’, 25 Australia Yearbook of International Law (2006) 43, at 50.
5 See, e.g., Goodman, supra note 4, at 50–51. However, note that Rodrígues Cedeño’s rst report for the
ILC expressly excludes acquiescence from the scope of the study of unilateral acts, see ILC, ‘First Report
of Special Rapporteur Victor Rodrígues Cedeño on Unilateral Acts of States’, A/CN.4/486, in Yearbook of
the International Law Commission, vol. 2 (1998), part 1, 319, at 324, para. 29, while the seventh report
acknowledges that acquiescence is in fact a unilateral act, see ILC, supra note 4, at 248, para. 190.
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About the Order of Cart and Horse, Among Other Things 109
An estoppel is precisely not a unilateral act; it is a representation the truth of which the entity
on whose behalf it is made is precluded from denying in certain circumstances.6
In the Gulf of Maine case, the ICJ Chamber observed that, while there are a number of
situations imaginable where estoppel and acquiescence (the same applies also to the
other unilateral acts mentioned above) arise under the same set of facts,7 it nonethe-
less must be borne in mindthat:
they are … based on different legal reasoning, since acquiescence is equivalent to tacit recogni-
tion manifested by unilateral conduct which the other party may interpret as consent, while
estoppel is linked to the idea of preclusion.8
Moreover, ‘the most characteristic element of estoppel is not the conduct of the State, but
rather the condence that is created in the other State’.9 Whereas recognition and acqui-
escence create an actual obligation – or, in the case of a waiver, relinquish an actual right
– estoppel does not change a legal status but, rather, precludes assertion of a specic fact
that would provide the basis for a certain legal claim. In other words, recognition, acqui-
escence and waiver change what is considered correct from a legal standpoint. Estoppel,
on the other hand, ‘is essentially a means of excluding a denial that might be correct – irre-
spective of its correctness. It prevents the assertion of what might in fact be true’.10
With regard to the requirements of estoppel, in international law doctrine and
the jurisprudence in interstate cases there has been some debate whether a strict or
a broader view of estoppel should be pertinent. What Irefer to in this article as the
‘strict view’11 of estoppel was most elegantly and authoritatively summarized by Derek
Bowett in his seminal article in the 1957 British Yearbook of International Law (BYIL):
The essentials of estoppelare:
(a) The statement of fact must be clear and unambiguous.
(b) The statement must be made voluntarily, unconditionally, and must be authorized.
(c) There must be reliance in good faith upon the statement either to the detriment
of the party so relying on the statement or to the advantage of the party making
the statement.12
6 Crawford, supra note 2, at 422 (emphasis in original). For examples of a less clear distinction between
estoppel and unilateral acts, see Suy, ‘Unilateral Acts of States as a Source of International Law: Some
New Thoughts and Frustrations’, in O.Corten (ed.), Droit du pouvoir, pouvoir du droit: Mélanges offerts à Jean
Salmon (2007) 631, at 640–641.
7 The Chamber called estoppel the ‘alter ego of acquiescence’. See Delimitation of the Maritime Boundary
in the Gulf of Maine Area (Canada v.United States of America), Judgment, 12 October 1984, ICJ Reports
(1984) 246, at 304, para. 129. See also Lim, supra note 4, para. 128; see also Brown, ‘A Comparative and
Critical Assessment of Estoppel in International Law’, 50 University of Miami Law Review (1995–1996)
369, at 401–402.
8 Gulf of Maine, supra note 7, at 305, para. 130.
9 ILC, supra note 4, at 250, para. 200.
10 Temple of Preah Vihear (Cambodia v.Thailand), Judgment, 15 June 1962, ICJ Reports (1962) 52, at 63,
Separate Opinion of Sir Gerald Fitzmaurice (emphasis added); see also H.Thirlway, The Law and Procedure
of the International Court of Justice: Fifty Years of Jurisprudence, vol. (2013), at 27.
11 Similar terminology also adopted, for example, in Cottier and Müller, supra note 1, paras 2–3.
12 Bowett, ‘Estoppel before International Tribunals and Its Relation to Acquiescence’, 33 British Yearbook of
International Law (BYIL) (1958) 176, at 202.
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110 EJIL 27 (2016), 107–128
Endorsements of such a strict view are to be found early on in the case law of interna-
tional courts and tribunals, including the Corvaia case,13 the Tinoco arbitration14 and
the Serbian Loans case before the Permanent Court of International Justice (PCIJ).15
However, what Imay call in contrast the ‘broad view’ – that is, dispensing in partic-
ular with the requirement of detrimental reliance and embracing the broader notions
of allegans contraria non audiendus est or venire contra factum proprium – was also fea-
tured prominently in the case law of international courts and tribunals, such as the
Shufeldt claim.16 In the Temple case, the existence of diverging views with regard to the
scope of estoppel also surfaced in the jurisprudence of the ICJ, both in the judgment
itself, which remains blurry as to the doctrinal concepts underlying its ndings, and,
more directly, in the several separate opinions, in particular, those of Vice-President
Alfaro and Judge Fitzmaurice. In the majority opinion, the Court heldthat:
Thailand in 1908–1909 did accept the Annex Imap as representing the outcome of the work
on delimitation, and hence recognized the line on the map as being the frontier line … [and]
Thailand’s subsequent conduct conrms and bears out her original acceptance.17
The emphasis on Thailand’s actual acceptance suggests that the Court categorized
Thailand’s conduct as accruing to acquiescence rather than estoppel, without men-
tioning the concepts by name.18 The separate opinions were more outspoken in this
regard. Sir Gerald Fitzmaurice observed that estoppel ‘is quite distinct theoretically
from the notion of acquiescence’,19 and he endorsed the strict view of estoppel,
13 In this case before the Italian–Venezuelan Claims Commission, the descendants of Baron Corvaia, who
was born in Sicily and had been a Venezuelan diplomat, claimed a considerable sum of money that
Venezuela had allegedly owed to the baron. The Commission held that Baron Corvaia, and thus his heirs,
were estopped from claiming the baron’s Italian citizenship, which was necessary for the claimants to
assert standing before the Commission: ‘[T]he man who accepts, without the express permission of
his own government and against the positive inhibitions of her laws, public and condential employ-
ment from another nation is himself estopped from reverting to prior condition to the prejudice of the
country whose interests he has adopted.’ Corvaia case (of a general nature), Italian–Venezuelan Claims
Commission, Judgment of 1903, reprinted in UNRIAA, vol. 10, 609, at 633.
14 Tinoco Arbitration (Great Britain v. Costa Rica), Judgment, 18 October 1923, reprinted in 18 American
Journal of International Law (1924) 147, at 157: ‘An equitable estoppel to prove the truth must rest on
previous conduct of the person to be estopped, which has led the person claiming the estoppel into a posi-
tion in which the truth will injure him.’
15 Payment of Various Serbian Loans Issued in France (France v.Serbia), 1929 PCIJ Series A, No.20, 4, at 39:
‘[I]t is quite clear that no sufcient basis has been shown for applying the principle [of estoppel] in this
case. There has been no clear and unequivocal representation by the bondholders upon which the debtor
State was entitled to rely and has relied. There has been no change in position on the part of the debtor
State.’ Although the judgment does not explicitly mention detriment, from the context of the passage
above it follows that this is what the Court meant with regard to the ‘change in position on the part of the
debtor State’. See also Brown, supra note 7, at 388.
16 Shufeldt Claim (United States v.Guatemala), Award of 24 July 1930, reprinted in UNRIAA, vol. 2, 1079, at
1094.
17 Temple of Preah Vihear, supra note 10, at 32–33.
18 Similarly Lim, supra note 4, at para. 139. Note also in this context Sir Percy Spender’s dissent who denies
the direct legal effect of unilateral acts such as recognition and acquiescence and grants them ‘evi-
dentiary value’ only. See Temple of Preah Vihear, supra note 10, at 131, Dissenting Opinion of Sir Percy
Spender.
19 Temple of Preah Vihear, supra note 10, at 62, Separate Opinion of Judge Fitzmaurice.
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About the Order of Cart and Horse, Among Other Things 111
requiring, with Bowett,20 detriment to the party relying on the representation.21 In
contrast, Vice-President Alfaro assimilated the notions of estoppel and acquiescence22
and asserted accordinglythat:
[w]hatever term or terms be employed to designate this principle such as it has been applied
in the international sphere, its substance is always the same: inconsistency between claims
or allegations put forward by a State, and its previous conduct in connection therewith, is not
admissible (allegans contraria non audiendus est).23
The divergent views regarding the scope and, accordingly, the requirements of estop-
pel among the judges at the Court at the time are reected in contemporaneous lit-
erature. Most prominent at the time, I.C. MacGibbon countered Bowett’s strict view
with a broad notion that, similar to Vice-President Alfaro’s separate opinion, regards
estoppel as a general prohibition of inconsistent behaviour that includes, among
others, recognition and acquiescence.24
However, starting from Barcelona Traction25 and featuring prominently in the North
Sea Continental Shelf cases,26 the ICJ developed a jurisprudence constante that embraced
the strict view of estoppel. The North Sea Continental Shelf cases concerned the delim-
itation of the continental shelf adjacent to the parties to the dispute, Germany on
the one side and Denmark and the Netherlands on the other side. Denmark and the
Netherlands argued that Germany was estopped from denouncing the terms of the
1958 Geneva Convention on the Continental Shelf (1958 Geneva Convention) since
Germany had participated in the drafting of the Convention and subsequently acted in
accordance with its provisions but had never ratied it. The Court disagreed:
Having regard to these considerations of principle, it appears to the Court that only the exist-
ence of a situation of estoppel could sufce to lend substance to this contention—that is to say
if the Federal Republic were now precluded from denying the applicability of the conventional
regime, by reason of past conduct, declarations, etc., which not only clearly and consistently
evinced acceptance of that regime, but also had caused Denmark or the Netherlands, in reli-
ance on such conduct, detrimentally to change position or suffer some prejudice. Of this there is no
evidence whatever in the present case.27
20 The opinion cites Bowett’s article, supra note 12, approvingly. Temple of Preah Vihear, supra note 10, at 62.
21 Temple of Preah Vihear, supra note 10, at 63; see also at 97, Dissenting Opinion of Judge Wellington Koo:
‘The legal basis of [estoppel] is that one par ty has relied on the statement or conduct of the other either
to its detriment or to the other’s advantage.’
22 Ibid., at 39, Separate Opinion of Vice-President Alfaro.
23 Ibid., 40.
24 See MacGibbon, ‘Estoppel in International Law’, 7 International Comparative Law Quarterly (1958) 468, at
471, 478, 501, 512; see also McNair, ‘The Legality of the Occupation of the Ruhr’, 5 BYIL (1924) 17, at
35; Cheng, supra note 3, at 141–149.
25 Barcelona Traction, Light and Power Company, Limited (Belgium v. Spain), Judgment on Preliminary
Objections, 24 July 1964, ICJ Reports (1964) 6, at 25. See also A.Martin, L’Estoppel en Droit International
Public (1979), at 162–165; Brown, supra note 7, at 394–395; Ovchar, ‘Estoppel in the Jurisprudence of
the ICJ’, 21 Bond Law Review (2009) 1, at 20.
26 North Sea Continental Shelf Cases (Germany v.Denmark and Germany v.the Netherlands), Judgment, 20
February 1969, ICJ Reports (1969)3.
27 Ibid., at 30 (emphasis added). However, note that the Court, somewhat misleadingly, speaks of ‘accept-
ance’ in the context of estoppel. Geneva Convention on the Continental Shelf 1958, 499 UNTS 311.
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112 EJIL 27 (2016), 107–128
In subsequent judgments until the present day, the Court has conrmed this clear and
unequivocal endorsement of the strict view of estoppel,28 as has been done in most of
public international law scholarship.29
My article will seek to address the questions posed in the beginning with regard to the
case law of international investment arbitration tribunals on estoppel by qualitative
and (a very modest) quantitative analysis. Section 2 begins with a brief quantitative
study of the decisions that mention and discuss (notions of) estoppel that will present,
inter alia, the outcome, the employed standard and the correlation between outcome
and employed standard (2.A). It will thereupon analyse the decisions embracing dif-
ferent views of estoppel with regard to the outcome and reasoning employed (2.B),
taking into account the results of the earlier study, which will lead me to a number
of preliminary observations and conclusions (2.C) – in particular, the lack of consist-
ency in investment arbitration jurisprudence. Section 3 seeks thereupon to develop a
couple of general doctrinal questions pertaining to the concept of estoppel in order to
address such matters of inconsistency, while Section 4 concludes the study.
2 Estoppel in the Jurisprudence of International Investment
Arbitration Tribunals
A A Bit ofData
Considering the sizeable number of international investment arbitration decisions men-
tioning and/or discussing estoppel, this section will begin with some gures.30 These
28 See, e.g., Gulf of Maine, supra note 7, at 305 (stressing detriment as dening feature of estoppel); Land,
Island and Maritime Frontier Dispute (El Salvador v. Honduras, Nicaragua intervening), Judgment, 13
September 1990, ICJ Reports (1990) 92, at 118 (reiterating the three requirements of the strict view
as set forth by Bowett, supra note 12, at 202); Land and Maritime Boundary between Cameroon and Nigeria
(Cameroon v. Nigeria, Equatorial Guinea intervening), Judgment, 11 June 1998, ICJ Reports (1998) 275,
at 303 (citing afrmatively the North Sea Continental Shelf cases and Land and Maritime Frontier Dispute);
Sovereignty over Pedra Branca/Pulau Batu Puteh, Middle Rocks and South Ledge (Malaysia/Singapore),
Judgment, 23 May 2008, ICJ Reports (2008) 12, at 81 (citing afrmatively the North Sea Continental
Shelf cases). Note, however, that the judgment on jurisdiction in the Qatar v.Bahrain case may be read
as somewhat of a (temporary) backpedalling to the broad view. See Maritime Delimitation and Territorial
Questions between Qatar and Bahrain (Qatar v.Bahrain), Judgment, 1 July 1994, ICJ Reports (1994) 112, at
121–122; see also Thirlway, supra note 10, at 1124.
29 See A. Mar tin, L’Estoppel en Droit International Public (1979), at 297–300; Crawford, supra note 2, at
420–421; J.P. Müller, Vertrauensschutz im Völkerrecht (1971), at 10; Shaw, supra note 3, at 73 (citing
approvingly the Land and Maritime Boundary between Cameroon and Nigeria case); Cottier and Müller, supra
note 1, para.3.
30 I searched the ‘Oxford Investment Claims’, ‘Investor State Law Guide’ and ‘Investment Treaty Arbitration’
databases for any investment arbitration decision – that is, regardless of the arbitration rules – mention-
ing ‘estoppel’ or ‘estop(ped)’. Hence, the gures presented here correspond to a research of only explicit
references of the term ‘estoppel’, ‘estopped’ or similar and, thus, do not necessarily include all instances
where a tribunal/an arbitrator implicitly used estoppel or estoppel-like argumentation to solve a case.
Therefore, Ipoint to the obvious possibility that these gures do not constitute comprehensive data on
every kind of usage of estoppel argumentation by investment tribunals. Rather, the gures presented
here may serve as indicator of tribunal’s approach to the matter and may inspire colleagues trained in
quantitative methods to a broader empirical study. The research covers case law until September 2014.
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About the Order of Cart and Horse, Among Other Things 113
gures are supposed to give an impression of how investment arbitration tribunals
approach matters of estoppel methodologically and doctrinally, what is the outcome of
their decisions and whether there are any correlations between the method/view chosen
and the outcome of the decision.31 My research revealed 53 decisions mentioning the
term ‘estoppel’ or ‘estop(ped)’. Four of these decisions used estoppel as an argumenta-
tive topos in support of expanding on another substantive matter, such as its relation to
the concept of legitimate expectations32 or the principle that a state may not invoke its
domestic law for justication of a breach of international law.33 Further, three decisions34
pertain to matters of res judicata, using the common law term ‘collateral estoppel’.35 The
remaining 46 decisions discuss matters of estoppel in the sense presented in the rst part
of this article. Of all 53 decisions, including the two separate categories just mentioned,
a majority of decisions (36) discussed matters of estoppel at the level of jurisdiction and
admissibility or in relation to issues of a procedural nature, while 12 decisions raised the
subject of estoppel at the merits stage, one time with regard to quantum and four times in
the annulment phase pursuant to Article 52 of the ICSID Convention.36
Who raised estoppel arguments? Here, there is a slight preponderance on the claim-
ant side (25), with respondents resorting 17 times to estoppel to corroborate their
case. However, not infrequently, the tribunal or the dissenting arbitrator introduced
estoppel proprio motu in order to develop their reasoning (11 times). With respect to
the outcome of the decisions, the tribunal/dissenting arbitrator rejected the estop-
pel argument in 33 instances, while only nine decisions came out in favour. In the
remaining 11 decisions, the matter remained undecided.37 It is thus fair to say that
arbitrators are rather hesitant to endorse an estoppel claim or argument.
Let me now turn to the doctrinal approach taken towards estoppel in the decisions
under scrutiny. Interestingly, despite the rather clear preference in ICJ case law and
31 I note here that Ispeak of ‘decisions’, not of ‘cases’ or ‘disputes’. Hence, the gures Iwill present cor re-
spond to the numbers of decisions that discuss matters of estoppel, of which a tribunal could issue several
in one and the same dispute. Also, dissenting opinions on matters of jurisdiction, the merits and/or quan-
tum will be counted as self-standing ‘decisions’, not, however, orders of a mere procedural nature.
32 Occidental Exploration and Production Company v. Republic of Ecuador, LCIA Case no. UN3467, Final
Award, 1 July 2004, paras 194–196; UNCITRAL, International Thunderbird Gaming Corporation v.United
Mexican States, Award, 26 January 2006, para. 27, Separate Opinion of Thomas Wälde; ICSID, Total SA
v.Argentina, Decision on Liability, 21 December 2010, ICSID Case no ARB/04/1, paras 132–134.
33 ICSID, ATA Construction, Industrial and Trading Company v.Hashemite Kingdom of Jordan, Award, 18 May
2010, ICSID Case no. ARB/08/2, para. 122.
34 ICSID, Compañía de Aguas del Aconquija SA and Vivendi Universal SA v Argentina, Decision on Argentina’s
Request for Annulment of the Award, 3 August 2010, ICSID Case no. ARB/97/3, paras 212–216; ICSID,
RSM Production Corporation etal v.Grenada, Final Award, 7 December 2010, ICSID Case no. ARB/10/6,
paras 7.1.1–7.1.3; Chevron Corporation and Texaco Petroleum Company v.Ecuador, First Partial Award on
Track I, 17 September 2013, PCA Case no.2009–23, para. 47.
35 See generally on those concepts in common law jurisdictions International Law Association, Committee
on International Commercial Arbitration, Berlin Conference 2004, Interim Report: ‘Res judicata’ and
Arbitration (2004), at 6–13.
36 Convention on the Settlement of Investment Disputes between States and Nationals of Other States
(ICSID Convention) 1965, 575 UNTS 159.
37 This includes the aforementioned four decisions where estoppel served as argumentative support for
another doctrine. See the cases in notes 32 and 33.
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114 EJIL 27 (2016), 107–128
scholarly writings for the strict view of estoppel, as described above,38 only 15 deci-
sions could be categorized as following the strict view. Thirteen decisions endorsed the
broad view instead – almost the same amount. In 15 further instances, it remained
opaque which doctrinal approach the tribunal/arbitrator took, while in 10 instances
the tribunal/arbitrator appears to have blurred the doctrinal lines to other concepts,
in particular, unilateral acts.39
Taking a closer look at those 28 decisions that could be categorized following either
the broad (13) or the strict view (15), an interesting pattern emerges. Obviously, the
tribunal/arbitrator did not explicitly identify the approach employed to decide the
matter in every decision and/or reiterated the requirements for the one view or the
other. However, while 13 of the total 15 decisions endorsing the strict view clearly
revealed their approach and/or recited the requirements and supporting authorities,
the gures are almost in exact reverse with regard to the broad approach. Only three
decisions40 out of a total of 13 clearly revealed that they took the broad approach,
whereas in 10 instances the approach may be inferred merely from the application by
the tribunal/arbitrator who often does not cite any authority.
Before moving on to the legal analysis of the case law, allow me to nish this brief
statistical intermezzo with gures on the correlation between the approach taken and
the outcome of the decision. Here, the three categories on the approach side (strict /
broad / unclear41) are viewed against the three categories on the outcome side (rejected
/ granted / undecided), thus creating nine pairs (strict–rejected, strict–granted, strict–
undecided; broad–rejected, broad–granted, broad–undecided; unclear–rejected,
unclear–granted and unclear–undecided) (see Table1).
For several reasons, four decisions could not be placed under one of these nine pairs,
reducing the numbers of decisions under scrutiny to 49.42
These pairs lead us to some interesting initial observations. First of all, all of the 15
decisions endorsing the strict view fall under the same pair: strict–rejected. In other
words, whenever tribunals/arbitrators chose the strict view, they always rejected the
estoppel claim – there was no other outcome. Second, when the broad view was chosen,
the chances of success were much better: a little more than half of the decisions (7 out
of 13) endorsing the broad view came out in favour of the estoppel claim, almost the
total number of all decisions in favour (7 out of 9, with the two remaining falling under
38 See section 1 of this article.
39 E.g., ICSID, Marvin Roy Feldman Karpa v.United Mexican States, Award, 16 December 2002, ICSID Case
no. ARB(AF)/99/1, para. 63 (blurring the lines between recognition, acquiescence and estoppel); ICSID,
Siemens A.G.v.Argentine Republic, Award, 6 February 2007, ICSID Case no. ARB/02/8, para. 282 (assimi-
lating acquiescence with estoppel); ICSID, Desert Line Projects LLC v.Republic of Yemen, Award, 6 February
2008, ICSID Case no. ARB/05/17, para. 118 (assimilating waiver with estoppel).
40 ICSID, ADC Afliate Limited and ADC & ADMC Management Limited v.Republic of Hungary, Award, 27
September 2006, ICSID Case no. ARB/03/16, para. 475; ICSID, Rumeli Telekom AS and Telsim Mobil
Telekomikasyon Hizmetleri AS v.Kazakhstan, Award, 21 July 2008, ICSID Case no. ARB/05/16, para. 335.
41 This latter category includes both those decisions where the approach taken was unclear and where the
tribunal/arbitrator blurred or confounded the doctrinal basis.
42 These include the three decisions discussing matters of res judicata as well as UNCITRAL, HICEE
B.V. v.Slovak Republic, Partial Award, 23 May 2011, para. 36, Dissenting Opinion of Judge Charles
Brower.
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About the Order of Cart and Horse, Among Other Things 115
the unclear–granted pair). Third, when the tribunal chose one or the other approach –
explicitly or implicitly – it almost always decided the matter (27 out of 28 decisions,
with only one decision under the broad–undecided pair43). However, fourth, this does
not mean that where the approach remained unclear or blurry, most matters remained
undecided. Rather, the majority of decisions (12) rejected the estoppel claim nonetheless.
Seven remained undecided and in only two instances was the estoppel claim accepted.
B Legal Analysis, Taking into Account the Observations on theData
Moving from quantitative to qualitative legal analysis, Ireiterate the earlier observation
that no view exerts a clear predominance in the case law of international investment
tribunals on estoppel. This is striking and merits further consideration, which Iwill pro-
vide below.44 At this initial stage, what follows from such observation is the need to look
more closely into the application of the broad and strict views in the case law.45
1 The Strict View: CaseLaw
One of the most elaborate discussions of estoppel by an investment arbitration tribunal
features in one of the very rst investment arbitration decisions, the Amco v.Indonesia
decision on jurisdiction.46 Indonesia contended that the claimant was estopped from
raising an argument as to the attribution of conduct by a third party to the govern-
ment that the claimant only had introduced at a late stage of the proceedings. The
tribunal relied mostly on the common law notion of estoppel, citing Anglo-American
jurisprudence and doctrine endorsing the strictview:
Where Ahas by his words or conduct justied B in believing that a certain state of facts exists,
and B has acted upon such belief to his prejudice, Ais not permitted to afrm against B that a
different state of facts existed at the time.47
Citing Vice-President Alfaro’s separate opinion in the Temple case,48 the tribunal
observed that a similar ‘principle’ exists under public international law and subse-
quently heldthat:
43 ATA Construction, supra note 33, para. 122.
44 See section 2.C in this article.
45 For lack of space, Iwill refrain from a full analysis of those decisions where the approach taken remained
opaque or where the tribunal/arbitrator blurred or confounded estoppel with other concepts.
46 ICSID, AMCO v.Republic of Indonesia, Decision on Jurisdiction, 25 September 1983, ICSID Case no.
ARB/81/1.
47 Ibid., para. 47 (citing to G.S.Bower and A.K.Turner, The Law Relating to Estoppel by Representation (3rd edn,
1977), at 4; Maclaine v.Gatty (1921) AC 376, at 382.
48 Temple of Preah Vihear, supra note 22, Separate Opinion of Judge Alfaro.
Table1: Cases Involving Estoppel by Approach and Outcome
Approach Outcome Strict Broad Unclear
Rejected 15 5 12
Granted 0 7 2
Undecided 0 1 7
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116 EJIL 27 (2016), 107–128
[a]lthough this dictum refers to activities of States, the Tribunal is of the view that the same
general principle is applicable in international economic relations where private parties are
involved. In addition, the Tribunal considers that, in particular for its applications in interna-
tional relations, the whole concept is characterized by the requirement of good faith.49
The actual discussion of the requirements of estoppel was rather brief, with the tribu-
nal stating that there was in particular no reliance to the detriment or benet of one
or the other party.50
The following number of decisions taking the strict view, CSOB v.Slovakia, Pope &
Talbot v. Canada and Gruslin v.Malaysia, which were issued around the turn of the
millennium, presented and applied the three-pronged test formulated by Bowett.51 In
all three cases, the tribunal rejected the estoppel claim for lack of the third require-
ment. The cite to Pope & Talbot in the Canfor case, again referring to Bowett’s article,
marks the rst instance of an investment arbitration tribunal referring to investment
arbitration case law in support of the strict view of estoppel.52 However, in its actual
discussion of Canfor’s contention that the United States’ conduct barred it from seek-
ing consolidation of proceedings, the tribunal contented itself with the observation
that the respondent did not act in bad faith.53 In Pan American Energy v.Argentina, the
estoppel claim failed because the tribunal did not see any one of the three require-
ments of the strict view fullled.54
More recently, the three interim awards on jurisdiction and admissibility in the
Yukos cases, issued on 30 November 2009, discussed whether the Russian Federation
was estopped from raising the limitations clause in Article 45(1) of the Energy Charter
Treaty (ECT) ‘due to its longstanding and unqualied support for the provisional
application of the ECT during the negotiations’.55 Citing the North Sea Continental Shelf
cases, the tribunal dismissed the claimants’ estoppel claim noting that the Russian
Federation had given no clear and unambiguous representation that it would provi-
sionally apply the ECT. Similarly, in the Chevron partial award on the merits before the
Permanent Court of Arbitration, the requirements of clear and unequivocal represen-
tation as well as detrimental reliance were found absent.56 In Nova Scotia v.Venezuela,
49 AMCO, supra note 46, para. 47.
50 Ibid., para. 48.
51 ICSID, Československa obchodní Banka, A.S.v.Slovak Republic, Decision of the Tribunal on Objections to
Jurisdiction, 24 May 1999, ICSID Case no. ARB/97/4, para. 47; UNCITRAL, Pope & Talbot Inc. v.Government
of Canada, Interim Award, 26 June 2000, paras 110–112; ICSID, Philippe Gruslin v.Malaysia, Award, 27
November 2000, ICSID Case no. ARB/99/3, paras 20.1–20.5. See also Bowett, supra note 12.
52 UNCITRAL, Canfor Corporation v.United States of America, Tembec Inc. et. al. v.United States of America and
Terminal Forest Products Ltd. v.United States of America, Order of the Consolidation Tribunal, 7 September
2005, para. 168.
53 Ibid., para. 169.
54 ICSID, Pan American Energy LLC and BP Argentina Exploration Company v.Argentine Republic, Decision on
Preliminary Objections, 27 July 2006, ICSID Case no. ARB/03/13, para. 160.
55 UNCITRAL, Hulley Enterprises Limited (Cyprus) v.Russian Federation, PCA Case no. AA 226; Yukos etal
v.Russian Federation, PCA Case no. AA 227; Veteran Petroleum Limited (Cyprus) v.Russian Federation, PCA
Case no. AA 228, Interim Award on Jurisdiction and Admissibility, 30 November 2009 (Yukos cases), all
at para. 286. Energy Charter Treaty 1994, 2080 UNTS 95.
56 Chevron Corporation and Texaco Petroleum Company v. Ecuador, Partial Award on the Merits, 30 March
2010, PCA Case no.34877, para. 353.
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About the Order of Cart and Horse, Among Other Things 117
with reference, inter alia, to the ICJ judgment in Land, Island and Maritime Frontier
Dispute and the Amco case, the claimant’s estoppel argument failed again for lack of
detrimental reliance.57
Cambodia Power v.Cambodia, which is one of the most recent decisions to adopt the
strict view of estoppel, also contains the most comprehensive discussion of the strict
view of estoppel since Amco.58 The claimant introduced ICSID proceedings on the basis
of a power purchase agreement (PPA) with Cambodia and sought to establish the pas-
sive standing of state-owned Electricité du Cambodge (EDC) as respondent in the arbi-
tration on the contention, inter alia, that the respondents were ‘estopped denying that
KOC [Kingdom of Cambodia] has designated EDC’ as the suitable respondent pursuant
to Article 25(1) of the ICSID Convention.59 After laying out the three requirements,
citing Bowett’s 1958 article, the tribunal found that Cambodia Power had failed to
establish that the respondent’s conduct met any of the three requirements. In particu-
lar, with regard to the rst requirement, it held that ‘[a] statement producing an effect
only upon the occurrence of a potential future event unquestionably prevents this
statement from being qualied as “unequivocal”’, and it determined with regard to
the requirement of prejudice that being held to pursue an alternative claim under the
rules of the International Chamber of Commerce, which the PPA nonetheless offered,
did not put the claimant in any detrimental position.60 Of further note, though it was
a contract and not a treaty arbitration, the tribunal did not doubt that the notion of
estoppel it employed was one of public international law, which corresponds to the
statement in the Chevron case that ‘it is the rules and principles of international law
that govern the application of estoppel … in the present proceedings’.61
2 The Broad View: CaseLaw
It took some time – until the early 2000s – for an investment arbitration tribunal to
adopt the broad view of estoppel, when the strict view had been rmly established as the
predominant view in general public international law jurisprudence. However, as the
above gures indicate, even then tribunals/arbitrators were hardly ever transparent in
the standard they applied and failed to cite authority in support of their endorsement
of the broad view. Middle East Cement v.Egypt62 and CME v.Czech Republic63 provide
excellent examples of this pattern. In both decisions, the tribunal satised itself with
dedicating only a single paragraph to the discussion of estoppel, without citing any
authority.64 Nonetheless, both tribunals granted the estoppel claim. Apparently, they
57 UNCITRAL, Nova Scotia Power Incorporated (NSPI) v.Bolivarian Republic of Venezuela, Award on Jurisdiction,
22 April 2010, paras 142–143.
58 ICSID, Cambodia Power Company v. Kingdom of Cambodia and Electricité du Cambodge LLC, Decision on
Jurisdiction, 22 March 2011, ICSID Case no. ARB/09/18.
59 Ibid., para. 260.
60 Ibid., paras 262–266.
61 Chevron, supra note 56, para. 350.
62 ICSID, Middle East Cement Shipping and Handling Co. S.A.v.Arab Republic of Egypt, Award, 12 April 2002,
ICSID Case no. ARB/99/6.
63 UNCITRAL, CME Czech Republic B.V.v.Czech Republic, Final Award, 14 March 2003.
64 See Middle East Cement, supra note 62, para. 135; CME Czech Republic, supra note 63, para. 488.
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118 EJIL 27 (2016), 107–128
accepted mere inconsistent behaviour as being sufcient, without requiring a show-
ing of detrimental reliance or discussing whether there was a clear and unequivo-
cal representation. In Middle East Cement, this is particularly striking as the tribunal
raised estoppel proprio motu.65
A similar pattern continued in subsequent case law. In ADC v.Hungary, the tribunal
relied, for support of its broad approach to estoppel, apodictically on ‘all legal systems’
and assimilated estoppel with waiver:
Whether one rests this conclusion on the doctrine of estoppel or a waiver it matters not. Almost
all systems of law prevent parties from blowing hot and cold.66
Again, the tribunal discussed estoppel upon its own motion and took only one para-
graph to elaborate on its opinion. In Fraport v.Philippines, both the majority and the
dissenting arbitrator took a broad view of estoppel (‘the principle that a State cannot
adopt inconsistent positions in respect of the same state of facts’67), citing no other
authority than ‘principles of fairness’.68 However, both dismissed the estoppel argu-
ment raised by the claimant for lack of substantiation. The tribunal in Desert Line
Projects v.Yemen, granting what it considered to be an estoppel claim by the claimant,
nonetheless relied exclusively on the Fraport majority opinion’s broad formulation of
estoppel.69 Further, the Rumeli v.Kazakhstan tribunal held that ‘it is also well estab-
lished in international law that a State may not take away accrued rights of a foreign
investor by domestic legislation abrogating the law granting these rights’, grant-
ing estoppel proprio motu and drawing on (the exclusive) support of ‘an application
of the principles of good faith, estoppel and venire contra factum proprium’.70 Urbaser
v.Argentina has eventually come to constitute the most recent decision following this
pattern, citing no authority and eventually nding estoppel based on the broad view.71
However, there are some notable exceptions. In Siag v.Egypt, the tribunal rejected
the respondent’s estoppel claim, although it did not embrace the strict view.72 Egypt
had contended that the claimants could not assert their exclusive Italian national-
ity for the purposes of jurisdiction ratione personae pursuant to Article 25(2)(a)
of the ICSID Convention because they had claimed earlier to be Egyptian citizens,
which had not been the case, although the claimants thought it was. Citing Hersh
65 Middle East Cement, supra note 62, para. 135.
66 ADC, supra note 40, para. 475.
67 ICSID, Fraport AG Frankfurt Airport Services Worldwide v. Republic of the Philippines, Award, 16 August
2007, ICSID Case no. ARB/03/25, para. 28.i, Dissenting Opinion of Mr. Bernardo M.Cremades.
68 ICSID, Fraport AG Frankfurt Airport Services Worldwide v. Republic of the Philippines, Award, 16 August
2007, ICSID Case no. ARB/03/25, para. 346.
69 Desert Line Projects, supra note 39, para. 120. This decision is yet another example of a tribunal blur-
ring the distinct doctrinal concepts of waiver – which would have been the correct categorization – and
estoppel.
70 Rumeli, supra note 40, para. 335.
71 ICSID, Urbaser S.A.and Consorcio de Aguas Bilbao Biskaia, Bilbao Biskaia Ur Partzuergoa v.Argentine Republic,
Decision on Jurisdiction, 19 December 2012, ICSID Case no. ARB/07/26, paras 109–110. Again, the tri-
bunal apparently raised estoppel proprio motu.
72 ICSID, Waguih Elie George Siag & Clorinda Vecchi v.Arab Republic of Egypt, Award, 1 June 2009, ICSID Case
no. ARB/05/15, paras 482–483.
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About the Order of Cart and Horse, Among Other Things 119
Lauterpacht’s report, written when he was special rapporteur on the law of treaties
for the International Law Commission,73 the tribunal insisted on intent as a necessary
requirement for considering that a conduct may accrue to estoppel,74 which it found
to be absent in the case athand.
Of particular interest is also the decision on jurisdiction in Kardassopoulos v.Georgia.75
In this dispute, the claimant relied on estoppel in support of his contention that the
respondent could not avoid the legal effect of a joint venture agreement (JVA) that a
state-owned entity had concluded with the claimant by referring to the alleged illegal-
ity of the JVA under Georgian law. The tribunal agreed with the claimant, stressing
that assurances of the validity of the JVA had been made to the claimant by ‘the most
senior Government ofcials of Georgia’76 and that, therefore, Georgia had ‘cloaked
[the JVA] with the mantle of government authority’.77 The tribunal, while applying
the rst two steps of the strict estoppel test, neither applied nor even mentioned the
requirement of detrimental reliance, hence, apparently endorsing the broad view.
However, looking at the facts of Kardassopoulos, the matter would have come out no
differently when applying the strict view. To his detriment, the claimant had relied
on the validity of the JVA because it made its investments under the assumption that
these would fall within the realm of a valid JVA under Georgian law.
C Observations and Preliminary Conclusions: Cart and Horse, Among
OtherThings
My analysis of the investment arbitration case law on estoppel commences with the
reiteration of the puzzling observation that the decisions did not show a preference for
the strict view or actually any view – in fact, decisions where the tribunal remained
unclear in its approach or where it confounded or blurred the doctrinal concepts
make up almost half of all decisions under review (25).78 The blurring and confound-
ing of the concepts of unilateral acts, on the one hand, and estoppel, on the other
hand, is particularly unfortunate.79 This is so not only for a purely academic prefer-
ence for doctrinal consistency – as explained above, ‘estoppel is precisely not a unilat-
eral act’80 – but, rather, because their effect is the same, while their requirements, as
well as the situations they cover, differ. Blurring concepts runs the danger of levelling
73 See ILC, ‘Report of Special Rapporteur Hersh Lauterpacht on the Law of Treaties’, A/CN.4/63, in Yearbook
of the International Law Commission, vol. 2 (1953) 90, at 144. Here, Lauterpacht discusses estoppel as
expression of the more general principle of good faith; however, not its specic doctrinal implications and
requirements.
74 Siag, supra note 72, para. 483.
75 ICSID, Ioannis Kardassopoulos v.Georgia, Decision on Jurisdiction, 6 July 2007, ICSID Case no. ARB/05/18.
76 Ibid., para. 192.
77 Ibid., paras 193–194, quoting ICSID, Southern Pacic Properties (Middle East) Limited v.Arab Republic of
Egypt, Award of 20 May 1992, ICSID Case no. ARB/84/3, para. 81.
78 See section 2.A in this article.
79 See, e.g., Marvin Roy Feldman Karpa, supra note 39, para. 63 (blurring the lines between recognition,
acquiescence and estoppel); Siemens, supra note 39, para. 282 (assimilating acquiescence with estoppel);
Desert Line Projects, supra note 39, para. 118 (assimilating waiver with estoppel).
80 Crawford, supra note 2, at 422 (emphasis in the original); see also section 1 in this article.
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120 EJIL 27 (2016), 107–128
the requirements to the smallest common denominator: the lowest-hanging fruit.81
However, let me raise a question here to which Iwill respond later: is the strict view
of estoppel too strict?82 Indeed, the quantitative analysis has shown that every single
one of the no less than 15 decisions endorsing the strict view of estoppel have rejected
the estoppel claim.83 This might indicate, or even mandate, that a broad(er) view of
estoppel is preferable.
In regard to the choice of a – broad or strict – view on estoppel, a couple of obser-
vations are striking. First, not a single decision discussed the reasons for its choice
of approach. Second, a citation of authorities, including international and domestic
case law and/or doctrine, is almost exclusively present where the tribunal or arbitra-
tor opted for the strict view. This is not at all to say that the citation of authorities is
an adequate substitute for legal reasoning. However, the more authorities one view is
able to invoke on its behalf, the more a preference for another view must be thoroughly
reasoned and corroborated with references to authorities. Most tribunals adopting
the strict view can at least claim that they have followed the majority of the interna-
tional case law and doctrine. However, not a single decision endorsing the broad view
gave any reasons why it diverged from, inter alia, the settled jurisprudence of the ICJ,
and very few of these in fact cited any authority.84 If putting this in context with my
third observation as to the choice of approach – that is, that all decisions adopting
the strict view dismissed the estoppel claim, whereas the estoppel claim succeeded in
the majority of those decisions that endorsed the broad view85 – the lack of reason-
ing on the choice of view becomes even more problematic. Apparently, the choice of
approach strongly indicates the outcome of the matter, which is particularly obvious
with regard to the strict view. Every time the tribunal chose the strict view, the estop-
pel claim failed. These gures, together with the lack of reasoning regarding why they
adopted one or the other approach, makes one wonder whether the tribunals’ choice
for the preferred outcome of the matter did in fact precede their choice of the legal
standard they employed reaching that outcome. Further, it appears that tribunals/
arbitrators only refer to requirements and cite authorities when they feel the need to
reject the estoppelclaim.
The suspicion that tribunals often put the cart before the horse when it comes to
considerations of estoppel may explain the somewhat odd Kardassopoulos decision,
where the tribunal seemed to endorse the broad view but where the facts would have
supported a positive nding of estoppel also when applying the requirements of the
strict view.86 Wanting to let the estoppel claim go through and knowing that the
strict view was a guarantor for dismissal, the tribunal possibly sought to avoid raising
doubts by applying the broad view. On the same note, most decisions rejecting estop-
pel under the strict view let the claim fail on the requirements that the broad view
81 See sections 1 and 3.A in this article.
82 See section 4 in this article.
83 See section 2.A in this article.
84 See section 2.B.2 in this article
85 See also ibid.
86 See ibid.
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About the Order of Cart and Horse, Among Other Things 121
avoids discussing (clear and unequivocal representation, detrimental reliance on the
representation).87
The diverging choices of approach also do not root in resort to different sources
of estoppel as a legal principle or rule. The case law under review seems in accord
that they apply a specic international law notion of estoppel88 that is applicable in
investor–state disputes.89 How to explain these striking inconsistencies, then? To my
mind, two further considerations deserve discussion. First, taking a closer look at
each decision, it appears that some tribunals and/or arbitrators refer quite indiscrimi-
nately to ‘estoppel’ in order to address legal issues that could have been tackled more
properly with other often more technical and precise rules. Ihave already mentioned
the several instances where estoppel was merely used as an argumentative topos in
support of another doctrine or principle.90 However, examples go beyond that. In the
Fraport majority decision,91 Arif v.Moldova,92 Quiborax v. Bolivia93 and, arguably, in
Kardassopoulos v.Georgia,94 the legal issue at stake was the compliance of the invest-
ment with domestic law rather than inconsistent representations of fact in general.
Further, the tribunals in Binder v.Czech Republic95 and Siag v.Egypt96 resorted to estop-
pel argumentation even though the exclusive discussion of the effective nationality
principle97 would have provided an adequate answer. In addition, the partial award in
Chevron v.Ecuador administered by the Permanent Court of Arbitration of 30 March
2010 might arguably have resolved the matter on considerations of abuse of process
alone.98
However, while this may elucidate several instances of inconsistency in the case
law, such (mis)uses of estoppel as a fall-back in order to avoid discussions of a more
technical nature fall short of providing a general explanation for the inconsistencies
87 See sections 2.B.1 and 2.B.2 in this article.
88 See, e.g., Cambodia Power, supra note 58, paras 260–270 (resorting to the international notion of estop-
pel in a contract claim); Petrobart Limited v. Kyrgyz Republic, Arbitral Award, 29 March 2005, ARB
no.126/2003, para. VIII.5.2: ‘A doctrine of estoppel is also recognised in public international law.’
89 See AMCO, supra note 46, para. 47.
90 See section 2.A in this article. with regard to legitimate expectations or the principle that a state may not
invoke its domestic law for justication of a violation of an inter national obligation. See also HICEE, supra
note 42, para. 36, Dissenting Opinion of Judge Charles Brower.
91 Fraport, supra note 67, paras 346–347, 387.
92 ICSID, Mr. Franck Charles Arif v.Republic of Moldova, Award, 8 April 2013, ICSID Case no. ARB/11/23,
para. 419.
93 ICSID, Quiborax S.A., Non Metallic Minerals S.A. and Allan Fosk Kaplún v. Plurinational State of Bolivia,
Decision on Jurisdiction, 27 September 2012, ICSID Case no. ARB/06/2, paras 257–258.
94 Kardassopoulos, supra note 75, paras 189–194.
95 UNCITRAL, Binder v.Czech Republic, Award on Jurisdiction, 6 June 2007, IIC 508 (2007), paras 79–80.
96 Siag, supra note 72.
97 See Crawford, supra note 2; Nottebohm Case (Liechtenstein v.Guatemala), Second Phase, Judgment, 6 April
1955, ICJ Reports (1955) 4, at 22; ILC, ‘Draft Articles on Diplomatic Protection with Commentaries’, in
Yearbook of the International Law Commission, vol. 2 (2006), part 2, 34–35 (Article 7 with commentaries).
98 Chevron, supra note 56, paras 349–353. However, one might question whether the concept of abuse of
process is any more precise than the notion of estoppel. Cf. H. Wehland, The Coordination of Multiple
Proceedings in Investment Treaty Arbitration (2013), para. 7.33: ‘Given the necessary vagueness and gen-
erality of the principle, any abstract discussion of the prohibition of abuse of process – whether or not led
in the context of a specic legal order – will typically not be helpful.’
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122 EJIL 27 (2016), 107–128
with regard to estoppel in international investment arbitration jurisprudence – no
less so because the decisions mentioned fall into all three categories (strict, broad and
unclear). Nonetheless, as it also illustrates the aforementioned blurring of lines by sev-
eral decisions between estoppel and unilateral acts,99 the generous resort to estoppel
indicates the concept’s use by many international investment tribunals as a substitute
where a more precise doctrinal discussion would have been wanted.
The second consideration pertains to the problem of inconsistency itself. Why is
inconsistency a concern at all? This question goes to the heart of the matter of the judi-
cial function of investor-state arbitration, or, in fact, of any international adjudication,
and can naturally not be explored in full here.100 Indeed, one may well argue that the
main, or even exclusive, function of investment arbitration is dispute settlement – that
is, the resolution of a specic dispute between the parties involved101 – and even more
so, considering the ad hoc nature of the investment regime, which lacks a permanent
body. In this case, inconsistency is the natural, if not the intended, result; arbitrators
must adopt the decision that best resolves the specic dispute among the specic parties.
Any decision that places consistency over dispute resolution would thus be irreconcil-
able with the judicial function of investment arbitration. Consequently, reproaching
the decisions with putting the cart before the horse would mean severely misconstru-
ing this function. Aresult-oriented approach is not only legitimate but also called for
if dispute settlement narrowly understood is the exclusive task of the arbitral tribunal.
However, arguably, there is more to the judicial function of investment arbitra-
tion tribunals. Ronald Dworkin stressed the importance of consistency in (domestic)
courts’ jurisprudence when tackling ‘hard cases’ by applying general principles inher-
ent in the system in order to ll gaps in the system.102 With regard to the task of the
PCIJ, Max Huber explainedthat:
La décision judiciaire tire son autorité non pas du fait qu’elle s’adapte bien aux exigences d’une situa-
tion particulière et momentanée, mais de ce qu’elle repose sur des raisons qui ont une valeur générale en
dehors du cas concret et une force conclusive pour tous.103
Similarly, according to Hersch Lauterpacht, the ICJ has a general ‘obligation of consis-
tency’.104 ‘In the name of consistency’, as Gleider Hernández puts it in his recent study
on the judicial function of the Court, ‘courts enjoy the requisite normative authority
to safeguard the stability, predictability, and above all the certainty of the law’.105
99 See discussion in this sub-section.
100 For recent literature on this subject, see generally K.J. Alter, The New Terrain of International Law (2014);
A.von Bogdandy and I.Venzke, In Wessen Namen? (2014); G.I. Hernández, The International Court and the
Judicial Function (2014).
101 See, e.g., Posner and Yoo, ‘Judicial Independence in International Tribunals’, 92 California Law Review
(2005) 1 at 6–7: ‘We view tribunals as simple, problem-solving devices.’ See also, with regard to the role
of the ICJ, Berman, ‘The International Court of Justice as an “Agent” of Legal Development?’, in C.Tams
and J.Sloan, The Development of International Law by the International Court of Justice (2013) 7, at 10, 11.
102 R. Dworkin, Taking Rights Seriously (1977), at 88.
103 M. Huber, ‘Speech by the President of the Permanent Court of International Justice, delivered upon the
inauguration of the second presidential term (1925–1927)’, PCIJ Series C, No. 7/1, 14, at 18.
104 H. Lauterpacht, The Development of International Law by the International Court (1958), at 15. See also
similarly S.Rosenne, The Law and Practice of the International Court 1920–2005, vol. 3 (2006), at 1536.
105 Hernández, supra note 100, at 188.
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About the Order of Cart and Horse, Among Other Things 123
Investment tribunals have commenced equally to view their role not only as arbi-
ters of the specic dispute but also, in the words of the tribunal in Saipem v.Bangladesh,
see themselves under ‘a duty to seek to contribute to the harmonious development of
investment law and thereby to meet the legitimate expectations of the community
of States and investors towards certainty of the rule of law’.106 One may challenge a
comparison to permanent courts such as the ICJ and cite the ad hoc nature of invest-
ment arbitrations as support for a pure dispute settlement function of investment
tribunals. However, Icontend that the investment regime inheres a necessity for con-
sistency and, thus, a judicial function that promotes predictability and legal certainty
for two reasons. First, both the contracting parties to international investment agree-
ments and the parties to a specic investment dispute share a common interest in
consistency. Considering the high and rapidly increasing number of investment cases,
many contracting parties are frequent respondents in investment arbitrations, and
the recent surge of proceedings against high income countries evidences that even
classical capital-exporting countries may quickly nd themselves confronted with a
host of investment claims introduced against them.107 Consistency in the jurispru-
dence of investment tribunals warrants legal certainty and, thus, predictability for
potential respondent states. Equally, consistency serves the interests of the investors
as legal certainty, and, hence, predictability provides a secure investment climate that
arguably is pivotal for investment promotion.108
Second, in international investment arbitration, an international tribunal con-
trols the exercise of domestic public authority by a sovereign.109 The encroachment
of investment tribunals on the sometimes central domestic policies raises concerns
with regard to the (democratic) legitimacy of investment arbitration. As Armin von
Bogdandy and Ingo Venzke highlight in their recent book on democratic legitimacy
of international courts and tribunals, predictability and legal certainty are a central –
if certainly not the only – building block for the legitimacy of international adjudi-
cation.110 This extends particularly to the importance of providing reasons for the
decision of the specic dispute since ‘a decision derives authority from the fact that
it applies rules or principles that can be defended’.111 In investment arbitration, this
crystallizes, for example, into Articles 48(3) and 52(1)(e) of the ICSID Convention.
106 ICSID, Saipem S.p.A.v.People’s Republic of Bangladesh, Decision on Jurisdiction and Recommendation of
Provisional Measures, 21 March 2007, ICSID Case no. ARB/05/07, para. 67. See also Fauchald, ‘The
Legal Reasoning of ICSID Tribunals: An Empirical Analysis’, 19 European Journal of International Law
(2008) 301, at 301, 355, 357, 359 (arguing ‘that there is a tendency among ICSID tribunals to contrib-
ute to a homogeneous development of the methodology of international law’).
107 According to UN Commission on Trade and Development (UNCTAD), of the 56 investment disputes
introduced in 2013, 26 were brought against developed countries, 19 against developing countries and
11 against economies in transition. See UNCTAD, World Investment Report (2014), at 124, available at
http://unctad.org/en/PublicationsLibrary/wir2014_en.pdf (last visited 1 July 2015).
108 See, e.g., the US Model Bilateral Investment Treaty (2012), preamble, fourth recital: ‘Agreeing that a
stable framework for investment will maximize effective utilization of economic resources and improve
living standards.’
109 See A.Kulick, Global Public Interest in International Investment Law (2012), at 95.
110 See A.von Bogdandy and I.Venzke, supra note 100, at 254ff.
111 Hernández, supra note 100, at 99.
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What follows from these observations and considerations is, to my mind, the necessity
of bringing consistency not only to the case law of international investment arbitration
tribunals on estoppel, in particular, but also to re-enforce the concept in general public
international law beyond the investment realm. The subsequent section will therefore
tackle what Iconsider two of the most pertinent issues that help to clarify the concept of
estoppel and its distinction vis-à-vis other concepts such as unilateral acts in particular.
3 Towards Consistency: Suggestions for Clarication of the
Concept of Estoppel in InternationalLaw
A Preference for the StrictView
Putting the considerations on general public international law jurisprudence and schol-
arship notions of estoppel and the outcome of the review of international investment
arbitration case law together, the strict view of estoppel as applied by the ICJ is the pref-
erable one, in my opinion.112 The obvious dilemma of having several doctrinal concepts
that have partly overlapping requirements and produce the same legal consequence has
already been pointed out.113 Rendering obsolete the concept with the highest require-
ments cannot be the goal or the effect of international jurisprudence, either by the ICJ or
by investment tribunals. This point sounds circular only at rst because there are good
reasons to set a high threshold for estoppel and, indeed, in some aspects a higher one than
for unilateralacts.
The conceptual differences between unilateral acts that entail an actual change of
legal position – creating an obligation or relinquishing a right – and estoppel, which
precludes assertion of an existent legal position, are undeniable. In fact, to my mind,
it is exactly this feature of estoppel – that is, that as Sir Gerald Fitzmaurice described it
in his separate opinion in the Temple case, ‘[i]t prevents the assertion of what might in
fact be true’114 – that justies, or rather calls for, setting the requirements for estoppel
higher than for unilateral acts. Indeed, estoppel is the only one of the four concepts
that produces the same legal result – that is, that Acannot claim Y instead of X – and
that enables a party to prevent her counterpart from relying on a legal position that
actually exists. Again in the words of Sir Gerald Fitzmaurice:
112 In this respect, see also the clear endorsements of the strict view by the ICJ, the International Tribunal
on the Law of the Sea (ITLOS) and an inter-state arbitration tribunal in recent cases. Sovereignty over
Pedra Branca/Pulau Batu Puteh, Middle Rocks and South Ledge (Malaysia/Singapore), Judgment, 23 May
2008, ICJ Reports (2008) 12, at 81; ITLOS, Dispute Concerning Delimitation of the Maritime Boundary
between Bangladesh and Myanmar in the Bay of Bengal (Bangladesh/Myanmar), Judgment, 14 March 2012,
paras 124–125; ITLOS, The “ARA Libertad” Case (Argentina v.Ghana), Order for Provisional Measures, 15
December 2012, 60–67, Separate Opinion of Judges Rüdiger Wolfrum and Jean-Pierre Cot; PCA, Railway
Land Arbitration (Malaysia v.Singapore), Award, 30 October 2014, PCA Case no.2012-01, 201ff, paras
199; Chagos Marine Protected Area Arbitration (Mauritius v. United Kingdom), Award, 18 March 2015,
para. 438.
113 See sections 1 and 2.C in this article.
114 Temple of Preah Vihear, supra note 10, at 63, Separate Opinion of Judge Fitzmaurice (emphasis added); see
also Thirlway, supra note 10, at 27.
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About the Order of Cart and Horse, Among Other Things 125
in those cases where it can be shown that a party has, by conduct or otherwise, undertaken,
or become bound by, an obligation, it is strictly not necessary or appropriate to invoke any rule
of preclusion or estoppel, although the language of that rule is often, in practice, employed to
describe the situation. … True enough, Acannot be heard to deny [an obligation]; but what this
really means is simply that Ais bound, and, being bound, cannot escape from the obligation
merely by denying its existence. In other words, if the denial can be shown to be false, there is
no room or need for any plea of preclusion or estoppel.115
Thus, unilateral acts ‘preclude’ claiming Y because X is true. There is no further
legal hurdle to pass because X is the content of the legal relationship between Aand
B.Estoppel, however, permits B to preclude Afrom claiming Y, even if Y is true. In
order to use this legal ‘magic trick’ of estoppel, which overcomes the actual existence
of a right or obligation and, thus, gives B an additional legal tool vis-à-vis A, as com-
pared to a unilateral act, B must demonstrate an additional requirement – that is, that
she has relied on the (clear, unequivocal and authorized) representation changing her
position to her detriment.
Therefore, this premise also provides an adequate response to the question raised
above whether the requirements of the strict view of estoppel are in fact not too strict
and should be relaxed.116 Admittedly, all decisions of investment arbitration tribunals
– and, in fact, all ICJ decisions of the last few decades117 – explicitly embracing the
strict view have rejected an estoppel claim. However, estoppel is, and should be, an
exceptional claim only granted in exceptional circumstances. It must be preserved as
a separate doctrinal concept with requirements that are distinct from unilateral acts
because it bestows the person successfully invoking estoppel with the ability to resort
to the legal ‘magic trick’ of holding Ato X, although Y is true. Only the strict view
can adequately do that. If the requirement of ‘prejudice’ is absent, the party pointing
at inconsistent behaviour of the other side must content itself with the effects that
the unilateral acts present. In addition, as the Kardassopoulos case evinces, there have
been circumstances in investment arbitration case law in which estoppel was present
even under the strict view.118 Alas, the tribunal in that case did employ the require-
ments of the broad view, for whatever reason.119
B Representations of Fact or Also Representations ofLaw?
Further, another observation that can be gleaned from the case law on estoppel is that
the decisions have applied estoppel indiscriminately to representations of fact and rep-
resentations of law. For example, in CME v.Czech Republic, the tribunal held that the
respondent was estopped from claiming the illegality of a memorandum of under-
standing under domestic law, even though the claimant before it had asserted its legal-
ity under Czech law. Similarly, in the Yukos cases, the tribunal appeared to accept the
claimants’ (implicit) submission that an adequate subject of estoppel would be to hold
115 Temple of Preah Vihear, supra note 10, at 63, Separate Opinion of Judge Fitzmaurice.
116 See section 2.C in this article.
117 See section 1 in this article.
118 Kardassopoulos, supra note 75, paras 189–194; see also sections 2.B.2 and 2.C in this article.
119 See section 2.C in this article.
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126 EJIL 27 (2016), 107–128
the Russian Federation estopped from denying the provisional application of the ECT
in the investment arbitration because it had asserted the opposite at an earlier stage.
However, can this be assumed so easily? The question at the heart of the matter is
what kind of ‘representations’ make adequate reason for estoppel – only representa-
tions of fact or also representations oflaw?
Bowett, in his seminal article in the BYIL, gives a clear-cut answer. To him, only a
‘representation of fact’ makes good subject of an estoppel claim:120
The estoppel rests on the representation of fact, whereas the conduct of the parties in construing their
respective rights and duties does not appear as a representation of fact so much as a representation
of law. The interpretation of the rights and duties of parties of a treaty, however, should lie
ultimately with an impartial international tribunal, and it would be wrong to allow the con-
duct of the parties in interpreting these rights and duties to become a binding interpretation
of them.121
Like investment tribunals, the ICJ has not expressly ruled on the matter but, instead,
appears to implicitly assume that a representation of law may accrue to an estoppel. For
example, in the aforementioned North Sea Continental Shelf cases, the Court did not reject
Denmark and the Netherlands’ plea that Germany was estopped from denouncing the
terms of the 1958 Geneva Convention per se but merely found that the representation
was not clear and unequivocal and that Denmark and the Netherlands had relied on such
representation to their detriment. In fact, the passage in the Court’s judgment appears
to indicate that, had Germany’s conduct ‘clearly and consistently evinced acceptance of
that regime [that is, the 1958 Geneva Convention] [and] had [this] caused Denmark or
the Netherlands, in reliance on such conduct, detrimentally to change position or suffer
some prejudice’, the Court would have accepted the estoppel plea.122
One may attempt to frame such representation as a factual one in contending that
what would have been represented here was the fact that Germany assumed the 1958
Geneva Convention regime to be binding upon her, not that it was actually binding –
which would be only the legal consequence of that fact. However, this seems to be
splitting hairs to me. Iagree with Hugh Thirlway that this would be, at best, a ‘pseudo-
fact’.123 Framed in this way, every legal assertion follows or entails a conduct that can
be described as a factual representation. However, this should not blur the difference
between a representation of a certain situation and the representation of the legal
assessment of that situation. In the words of Bowett:
120 E.g., Bowett, supra note 12, at 177, 183, 189, 202.
121 Ibid., at 189–190 (emphasis added); see also at 196 (speaking of the relation between admission and
estoppel): ‘To a certain extent admissions have a wider scope than estoppels, for an admission may con-
cern a question of the interpretation of a legal rule or the existence or non-existence of legal rights; estop-
pel, in contrast, are conned to representations of fact.’
122 North Sea Continental Shelf cases, supra note 26, at 30; see also section 1 in this article. For a more recent
example, see also Dispute Concerning Delimitation, supra note 112, paras 124–125. Bangladesh had asked
ITLOS to hold that Myanmar was estopped from contesting the validity of an agreement between the
two states regulating matters of delimitation that were at issue in the case at hand. The Tribunal did not
discuss whether such claim of estoppel was adequate in itself but dismissed the estoppel claim for lack of
a clear and unequivocal representation to the effect claimed by Bangladesh.
123 See Thirlway, supra note 10, at 36.
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About the Order of Cart and Horse, Among Other Things 127
[t]he relation of estoppel to the sphere of fact and law is that it operates in the former only, but
in so doing it may determine the context within which the legal rights and duties of the parties
have meaning and application: a nice distinction, but a necessary one.124
Furthermore, this distinction indicates why, to my mind, claims of estoppel should be
conned to representations of fact only. The attempt to frame a legal representation as
a factual one would require, using again the example from the North Sea Continental
Shelf cases, that one describes Germany’s conduct as assuming the obligation that the
1958 Geneva Convention regime is binding upon her – that is, Germany’s acceptance
of the legal regime of the Convention. However, the assumption of an actual obliga-
tion that changes the legal relationship is – as described above – the dening charac-
teristic of a unilateral act that precisely distinguishes it from an estoppel claim.125
In addition, as Thirlway observes, accepting representations of law as an adequate
subject of estoppel would have ‘curious consequences for the development of custom-
ary law’, notably with regard to the opinio iuris:
Suppose that a State has protested against an extension of maritime jurisdiction claimed by another
State at a time when that extension is gaining ground but has not yet become recognized by general
customary law; once that recognition has been achieved, is the State which protested to remain,
so far as regards its own maritime jurisdiction, locked into the previous customary-law regime?126
Where state practice is constitutive of law, estoppel should not lead to the creation of a
sort of hierarchy of opinio iuris of states, whereby the one is de facto less valuable than
the other because states are locked into their former expressions of what they consider
the state of the law: ‘[I]t is difcult to accept that a State is bound in its own affairs by
a view of the law which it asserted against another State on a previous occasion.’127
4 Conclusions
As revealed in the discussion of international investment arbitration jurisprudence,
tribunals are often called upon to decide estoppel claims, which are frequently intro-
duced by both claimants and respondents. Not infrequently, tribunals in fact resort
to estoppel arguments proprio motu in order to decide a matter.128 Considering the
124 Bowett, supra note 12, at 190.
125 Ibid., at 196, 200. This is why, in my opinion, the recent Chagos award confounds estoppel with unilat-
eral acts. The subsequent conrmation of the Lancaster House undertakings of 1965 at the heart of
Mauritius’ fourth submission constituted unilateral acts (if one deems any such conrmation necessary
at all for the undertakings to be legally binding, anyway), as the UK government had expressed on several
occasions since 1965 that it considered them binding upon itself. Hence, the Tribunal’s sweeping state-
ment that ‘the principle [of estoppel] in international law does not distinguish between representations
as to existing facts and those regarding promises of future action or declarations of law’ blurs the ne
line between the two concepts. The passage from Judge Fitzmaurice’s separate opinion in the Temple case,
which the tribunal quotes in support of its contention, rather conrms such clear-cut distinction between
estoppel and unilateral acts. See Chagos Marine Protected Area Arbitration, supra note 112, para. 437.
126 Thirlway, supra note 10, at 37.
127 Ibid. For a partly broader view, however, see Müller, supra note 29, at 10. See also HICEE, supra note 42,
para. 36, Dissenting Opinion of Judge Charles Brower.
128 See section 2.A in this article.
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128 EJIL 27 (2016), 107–128
popularity of the concept in international investment case law, there is considerable
inconsistency and lack of transparency with regard to the view adopted and the rea-
sons for choosing such a view – which is rather ironic for a doctrinal concept dealing
with the effects of inconsistent behaviour. Almost half of the decisions under scrutiny
have remained unclear in their approach and/or have blurred or confounded the dis-
tinctive lines of estoppel and unilateral acts – again, without providing any reasons.
Not a single decision has discussed its preference for the broad or the strict view of
estoppel, and, in particular, those decisions embracing the broad view did not indicate
why they deviated from established ICJ jurisprudence and hardly ever cited authorities
in support of the tribunal’s/arbitrator’s choice for the broadview.
It may well be that arbitrators often do not see the need for an elaborate discussion
of the concept of estoppel because notions of consequences of inconsistent behaviour
exist in almost every legal system and, thus, arbitrators feel fairly familiar with the
concept. However, the present study demonstrates the problems that such an ‘I know
it when Isee it’ approach entails. Estoppel exists as a self-standing international law
concept that is applicable in investor-state arbitration, which no decision has denied.
According to the preferable view, which nds support in ICJ jurisprudence, it is a con-
cept distinct from unilateral acts. For reasons of consistency and clarity both in rela-
tion to unilateral acts as well as with regard to customary international law (opinio
iuris), the strict view of estoppel – which requires (i) a representation of fact; (ii) that
this representation of fact is clear and unequivocal; (iii) that it is made voluntarily,
unconditionally and by an entity authorized to make such representation and (iv) on
which the other side relied in good faith to its detriment or to the advantage of the
party making the representation – is to be preferred. Of particular note, as developed
above, estoppel should accrue not from a representation of law but, rather, exclusively
from a representation offact.
Failing to be transparent and blurring the lines between distinct doctrinal concepts
does not only inhere the danger of producing dubious or even incorrect results but
also of rendering obsolete the concept of estoppel altogether, as it currently stands
under public international law. Among several concepts producing the same out-
come – Amay not invoke Y instead of X – it stands out as setting a particularly high
threshold that is justiable as a distinct doctrinal category because estoppel can do
what the other concepts cannot: the ‘magic trick’ of preventing the effect of a right
or obligation that does in fact exist. This leads me to conclude that, considering the
importance of consistency in the jurisprudence of international investment tribunals
as promoted in this contribution,129 arbitrators cannot be satised with the impression
that some decisions have put the cart before the horse – that is, that the choice of out-
come precedes the choice of view. Even if tribunals reject adopting the strict view as
advocated here, explaining why they preferred the broad view over the strict view and
corroborating the choice of view by reference to authorities will be vital for developing
a consistent and well-reasoned jurisprudence on estoppel in international investment
arbitration as well as in public international law in general.
129 See section 2.C in this article.
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