In the face of globalisation, investment relations have increased exponentially in the past decades. However, there are discrepancies about the interpretation of legal concepts relevant to international investment contracts and there is no international standard to guide the contractual relationship between States and private investors.
UNIDROIT’s project on International Investment Contracts (IICs) aims at developing guidance to foster the modernisation and standardisation of international investment contracts. It will explore the interaction between the UNIDROIT Principles of International Commercial Contracts (UPICC) and common provisions in international investment contracts, and it will seek to address a number of recent developments in the area of international investment law, such as the increasing focus on corporate social responsibility and sustainability.
The project is jointly undertaken by UNIDROIT with the International Chamber of Commerce’s Institute of World Business Law (ICC Institute). This partnership will combine UNIDROIT’s expertise in developing international law instruments in the field of private law with the ICC Institute’s expertise on investment arbitration and the development of model clauses.
In 2022, the Secretariat received a proposal from the ICC Institute for a joint project on investment contracts, for inclusion in UNIDROIT’s 2023-2025 Work Programme (Unidroit 2022 – C.D. (101) 4 rev., Annexe 3). The proposal aimed at exploring how international investment contracts could be modernised, harmonised, and standardised, particularly in light of the UPICC and ICC standards, with a view to address —at the contractual level— a number of developments in the area of international investment law in the last decades, such as the trend to incorporate public policy goals in investment treaties and the increasing potential relevance of international investment contracts, also given the need to specify vague treaty norms and address legal uncertainty deriving from the lack of uniformity in arbitral decisions.
UNIDROIT’s Governing Council at its 101st session (June 2022) agreed on the importance of this topic and noted that it fit well with UNIDROIT’s work. It welcomed the partnership with the ICC Institute and recommended to include a project on IICs in the 2023-2025 Work Programme.
Following the Governing Council’s recommendation, the General Assembly at its 81st session (December 2022), agreed to include this project in UNIDROIT’s 2023-2025 Work Programme with high priority. It acknowledged that the project was ambitious and would have an impact on strengthening the contractual framework for international investments.
Pursuant to the mandate provided by UNIDROIT’s governing bodies, the project will explore developments in international investment law and their impact on investment contracts. Examining the role of the UPICC in IICs is a cornerstone of this project. The UPICC’s interaction with common contractual terms in IICs will highlight the need for legal guidance or adjustments to fill possible gaps.
On 7 June 2022, the UNIDROIT Secretariat and the ICC Institute jointly organised a Workshop on Transnational Law and Investment Contracts, as a side event to the 101st session of UNIDROIT’s Governing Council.
The one-day event, opened by UNIDROIT’s President, Professor Maria Chiara Malaguti, included introductory remarks by the Secretary-General of UNIDROIT, Professor Ignacio Tirado, as well as Eduardo Silva Romero and Sybille de Rosny-Schwebel, respectively Chair and Director of the ICC Institute.
The workshop was followed by three panels exploring different aspects:
The workshop considered developments in international investment law and confirmed the need for guidance at the contractual level.
As consistent with the Institute’s established working methodology, a Working Group has been established, composed of members selected for their expertise in contract law and international investment law. Experts participate in a personal capacity and represent different legal systems and geographical regions. The Working Group is comprised of the following expert members and individual observers:
Representatives of the ICC Institute for this project include Mélida Hodgson (Vice-Chair) and Cristina Martinetti (Member of the ICC Institute Council).
In addition, several international and regional organisations have been invited to participate in the Working Group as institutional observers. Participation of these organisations and stakeholders will ensure that different regional perspectives are taken into account in the development and adoption of the instrument. It is also anticipated that the observer organisations will assist in the promotion, dissemination and implementation of the instrument once it has been adopted.
1st Working Group Meeting
The first meeting of the IIC Working Group will take place at the premises of UNIDROIT in Rome on 23-25 October 2023.