Number of Conciliators and Method of their Appointment - ICSID Convention Conciliation

Parties should agree on the number of conciliators on a Commission and the method of their appointment. If they cannot agree, ICSID’s default mechanism will apply (Article 29 of the ICSID Convention and Conciliation Rules 2 and 3).

Method of Constitution of a Commission 

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Party Agreement
As a first step in the appointment process, the parties should refer to the contract, treaty or law containing the consent to ICSID conciliation. This instrument may set forth a prior agreement between the parties on the number of conciliators and/or the method of their appointment.

Absent a prior agreement, ICSID invites the parties to agree on the number of conciliators and the method of their appointment when ICSID registers the request for conciliation. Conciliation Rule 2 provides a procedure and timeline to assist the parties in reaching an agreement.

A Commission must always consist of a sole conciliator or any uneven number of conciliators. The parties are otherwise free to adopt any workable method of appointment that suits their needs, including provisions on time limits and special procedures. The parties do not have to appoint conciliators from the ICSID Panel of Conciliators.

Examples of agreements for three-member Commissions are:

  • Each party appoints one co-conciliator, and the parties attempt to agree on the third conciliator, the President of the Commission. If the parties fail to agree, the Secretary-General (or the Chairman of the Administrative Council) of ICSID appoints the President.
  • Each party appoints one co-conciliator, and the co-conciliators attempt to agree on the third conciliator, the President of the Commission. If the co-conciliators fail to agree, the Secretary-General (or the Chairman of the Administrative Council) of ICSID appoints the President.

As part of their agreement on the method for constituting the Commission, the parties may agree to adopt a list procedure concerning proposed candidates. List procedures can be used for a Sole Conciliator, the President of the Commission or all members of the Commission.

Commonly used list procedures include:

  • The parties exchange a list of candidates; each party informs the other party of the candidate(s) whom it accepts or rejects.
  • The parties request that ICSID provide them with a list of candidates. Each party can strike a certain number of candidates and rank the remaining candidates. The candidate with the best ranking is appointed.

ICSID supports parties’ efforts to agree on the method of appointment and will follow the agreed method and facilitate the process to the fullest extent possible.

Default Mechanism

If no agreement on the number of conciliators and the method of their appointment is reached within 60 days after registration of the request for conciliation, either party may request the application of the default formula under Article 29(2)(b) of the ICSID Convention. The formula provides that:

  • The Commission consists of three conciliators.
  • Each party appoints one co-conciliator.
  • The parties attempt to agree on the third conciliator, the President of the Commission.

In cases where the default formula applies, Conciliation Rule 3 sets forth the process by which the parties appoint the members of the Commission:

  • The first party to appoint a conciliator also proposes a candidate to serve as President of the Commission.
  • The other party then appoints a conciliator and either agrees to the appointment of the conciliator proposed for President or proposes another candidate.
  • If a counter-proposal is made, the party making the first appointment then indicates whether it agrees to the new proposal for President.
  • The parties are not limited in the number of proposals or counter-proposals that can be made. 

 

No Agreement ("Default Mechanism"): Article 29(2)(b) of the ICSID Convention

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The parties may agree on a different method of constituting the Commission even after a party has raised the ICSID default formula.
If the parties are unable to appoint all members of the Commission under the established method, either party may invoke the ICSID default mechanism for appointing the missing conciliator(s).
 

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