March 21, 2022: Member States of the International Centre for Settlement of Investment Disputes (ICSID) have approved a comprehensive set of amendments to ICSID’s flagship rules for resolving disputes between foreign investors and their host States.
“The amendment of the ICSID rules is a key achievement for improving international dispute resolution,” said David Malpass, President of the World Bank Group and Chair of the ICSID Administrative Council. “The amended rules streamline procedures to enable greater access and speed, increase transparency, and enhance disclosures, with the ultimate goal of facilitating foreign investment for economic growth.”
Established in 1966, ICSID is the only multilateral institution with a specific mandate to facilitate the peaceful resolution of international investment disputes under treaties, contracts, and investment laws. ICSID offers rules of procedure that are specifically designed for such disputes, as well as providing expert support to disputing parties and first-class facilities for proceedings.
The ICSID rules for arbitration and conciliation have been updated to further reduce the time and cost of cases, including mandatory timeframes for rendering orders and awards. New expedited arbitration rules are also now available, which would cut case times in half when adopted by parties.
Entirely new procedural rules were developed for mediation and fact-finding. The mediation rules offer a process to support a negotiated resolution of a dispute between parties, while fact-finding provides an impartial and targeted assessment of facts related to an investment. Both may be used as stand-alone procedures or in combination with an arbitration proceeding.
“The project of amending the ICSID rules has been an ambitious undertaking that has involved hundreds of State officials, legal specialists, and business representatives,” said Meg Kinnear, Secretary-General of ICSID. “Their adoption is a testament to the fact that multilateral processes can—and do—deliver tangible and positive results.”
Other attributes of the 2022 amended rules include:
- Broader access to ICSID’s dispute resolution rules and services. Jurisdictional requirements under ICSID’s Additional Facility have been modified, providing States and investors access to Additional Facility arbitration and conciliation where one or both disputing parties is not an ICSID Contracting State. Regional Economic Integration Organizations—such as the European Union—may also be a party to proceedings under the amended Additional Facility Rules.
- Greater transparency. The updated ICSID arbitration rules will further enhance public access to ICSID orders and awards, which benefits legal consistency in tribunal decision making. At the same time, the rules assist parties in identifying confidential information and specify that protected personal information cannot be publicly disclosed.
- Disclosure of third-party funding. For the first time, the ICSID arbitration rules address third-party funding. Disputing parties have an ongoing obligation to disclose third-party funding—including the name and address of the funder—to avoid conflicts of interest that may arise out of such financing arrangements.
The 2022 ICSID Regulations and Rules come into effect on July 1, 2022.
Over the coming months, ICSID will publish guidance notes to assist users in applying the updated rules, as well as offer briefings and courses by request.
Further information on the ICSID rule amendment process—including Working Papers and the input received on them—is available on the ICSID website at https://icsid.worldbank.org/resources/rules-amendments