THE CETA ICS arbitrators would be paid by the day: more and longer cases mean higher fees
The CETA arbitrators adjudicating on the merits of a claim for financial compensation by an investor at the ICS would be part-time employees who get paid more the longer a case goes on and the more cases that are taken. In order to retain their independence, the European Commission is proposing they are paid a ‘retainer’ fee of €24,000 a year, and then €3,000 to €7,000 a day when hearing cases:
“CETA provides for a combination of a monthly retainer fee determined by the CETA Joint Committee (the European Commission proposes €2,000 per month for members of the tribunal of first instance and €7,000 for members of the appeals tribunal) and per diems for days on which the tribunal members actually work on a case, on the basis of Regulation 14(1) of the Administrative and Financial Regulations of the International Centre for Settlement of Investment Disputes (ICSID) Convention, currently US$3,000 per day.” – Centre for International Governance Innovation (Krajewski, 2016).
See also, article 8.27.12 in CETA on ‘retainer’.
Krajewski, M. (2016) ‘Half Court, Half Tribunal: Why the Proposed CETA Tribunal Should Be Transformed into a Permanent Court. Investor-State Arbitration Commentary Series No. 5. Series: Cosmic or Cosmetic Reform: Commentaries on the real and imagined potential of CETA’s investment tribunal’. May 12th . Available at: https://www.cigionline.org/publications/half-court-half-tribunal-why-proposed-ceta-tribunal-should-be-transformed-permanent
And, from page 143: of:
VanHarten, G. (2016) ‘The European Union’s Emerging Approach to ISDS: a Review of the Canada-Europe CETA, Europe-Singapore FTA, and European-Vietnam FTA’, in University Of Bologna Law Review, Vol. 1, ISSN2531-6133, DOI 10.6092/issn.2531-6133/6318. Available here: https://bolognalawreview.unibo.it/article/view/6318/6095
Higher wages for arbitrators the more cases they take:
“Most significantly, in the revised CETA and Vietnam FTA, steps were taken to address the lack of independence in ISDS. ISDS adjudicators under the CETA will be members of a roster with a reasonable degree of security of tenure. There will also be more public accountability in their initial appointment, albeit with a potentially driving role in appointment decisions given to trade officials rather than higher-level publicly-accountable decision-makers, and adjudicators will be assigned to cases through an objective process of rotation. Furthermore, adjudicators will not be permitted to work on the side as counsel in other ISDS cases although, remarkably, they are not prohibited from working on the side as ISDS arbitrators, thus apparently permitting a party to an ISDS dispute to appoint a CETA ISDS roster member as an arbitrator in an ISDS dispute under another treaty and to pay him or her directly and lucratively in that other context. This aspect of the revised CETA –along with its language on the required or preferred expertise of ISDS adjudicators and the potentially dominant role of trade officials in appointments to the roster – suggests that a way may have been cleared for the same small group of individuals who have dominated ISDS decision-making so far, and leaned heavily toward expansive/pro-claimant investor resolutions of contested legal issues under investment treaties – to populate the CETA ISDS roster.
In Conclusion on ICS / ISDS:
“Domestic investors and citizens and other foreign nationals are disadvantaged in ISDS, relative to foreign investors. They face the usual risks of democracy, regulation, and courts in the usual ways: by taking part in the democratic process, by lobbying or protesting, by buying insurance, by bargaining for strong dispute settlement clauses in contracts with government, or by going to court. Foreign investors can still do all these things too, but with ISDS they have the added weapon of an exceptionally-powerful right to sue countries at the international level. Any proposal to grant special privileges, backed by public funds, to a group of economic actors – here, typically the largest and wealthiest in the world – calls at least for a compelling justification based on clear evidence of public benefit. The absence of this justification and evidence has been a key omission in European Union’s current pursuit of a greatly expanded role for ISDS.”
Reference: VanHarten, G. (2016) ‘The European Union’s Emerging Approach to ISDS: a Review of the Canada-Europe CETA, Europe-Singapore FTA, and European-Vietnam FTA’, in University Of Bologna Law Review, Vol. 1, ISSN2531-6133, DOI 10.6092/issn.2531-6133/6318. Available here: https://bolognalawreview.unibo.it/article/view/6318/6095