WASHINGTON, D.C., June 21, 2021 — The Republic of Ecuador’s Ambassador to the United States, Ivonne Juez Abuchacra de Baki, today signed the Convention on the Settlement of Investment Disputes between States and Nationals of Other States, also known as the ICSID Convention.
The ICSID Convention, which entered into force in 1966, establishes the institutional and legal framework for resolving international investment disputes. It was created to facilitate investment amongst countries by providing an independent, depoliticized forum for arbitration, conciliation and fact-finding. Today, Ecuador becomes the 164th State to sign the Convention, which has been ratified by 155 countries.
“Resolving grievances with foreign investors efficiently and fairly is critical to cultivating a competitive business environment,” said David Malpass, President of the World Bank Group and Chair of the ICSID Administrative Council. “I congratulate the Government of Ecuador on taking this important step and its renewed focus on private sector investment.”
Having signed the ICSID Convention, it must now be ratified before coming into force for Ecuador.
Once in force, Ecuador will participate in the governance of ICSID through representation on its governing body, the Administrative Council. Each ICSID Member State has one representative—and one vote—on the Administrative Council. Its responsibilities include approving rules of procedure for ICSID cases and electing the ICSID Secretary-General and Deputy Secretaries-General. ICSID Member States also have the right to name arbitrators and conciliators to the ICSID Panels.
“We welcome Ecuador’s signing of the ICSID Convention. Today’s signature confirms the country’s commitment to strengthen its investment climate," said Meg Kinnear, ICSID Secretary-General. "Providing access to an impartial dispute resolution mechanism reduces risk and gives greater confidence to investors, which leads to attracting crucial investment flows and generating more development opportunities for all."
Ecuador originally signed the Convention and deposited the instrument of ratification on January 15, 1986. In accordance with Art. 68(2), the Convention entered into force for Ecuador on February 14, 1986. On July 6, 2009, the World Bank Group (WBG) received a written notice of denunciation of the ICSID Convention from Ecuador. In accordance with Article 71 of the ICSID Convention, the denunciation took effect on January 7, 2010, six months after the receipt of Ecuador's notice.
- The International Centre for Settlement of Investment Disputes (ICSID) is the world’s leading and most experienced institution for arbitration and conciliation of investor-State disputes, having administered over 70% of all international investment cases.
- Available both to investors and States, ICSID is an impartial facility and administers case proceedings when requested by the parties to a dispute. Disputes are settled by a tribunal or a commission, and its arbitrators or conciliators are impartial experts who are normally appointed by the parties or ICSID.
- As one of the five organizations of the WBG, ICSID helps to strengthen investment climates and make international investment more secure by offering impartial and effective dispute settlement services. This contributes to the WBG’s efforts to maximize finance for development by encouraging private investment and stable investment climates.