Bifurcation - ICSID Convention Arbitration (2006 Rules)

Bifurcation most often refers to the separation of jurisdictional issues from the merits and is defined as a separate jurisdictional phase to consider the jurisdictional and admissibility objections raised by the respondent.

The Tribunal has discretion to bifurcate jurisdictional issues (Article 41(2) of the ICSID Convention). There is no presumption in favor of bifurcation.  In deciding whether to bifurcate, the Tribunal balances the rights of the parties. The Tribunal may consider factors such as:

• the merit of the objection;
• whether bifurcation would materially reduce time and costs; and
• whether jurisdiction and merits are so intertwined as to make bifurcation impractical.

A Tribunal may also select particular jurisdictional issues for a preliminary determination.

The Tribunal has discretion to decide whether to suspend the proceedings on the merits when it bifurcates (Arbitration Rule 41(3)).

The Tribunal may also hear other issues in separate phases, such as splitting the merits into liability and quantum phases.