International Judicial Monitor
Published by the International Judicial Academy, Washington, D.C., with assistance from the
American Society of International Law

Fall 2009 Issue
 

International Tribunal Spotlight

 

Permanent Court of Arbitration

Permanent Court of ArbitrationBy: Christine E. White, Copy Editor and Reporter, International Judicial Monitor

History
The Permanent Court of Arbitration (PCA) is the oldest international dispute settlement organization in the world.  It was created during the First Hague Peace Conference in 1899 by the Convention for the Pacific Settlement of Disputes in which the signatories noted that arbitration was “the most effective, and at the same time the most equitable, means of settling disputes” (Article 16).  The Second Hague Peace Conference in 1907 expanded on and revised the 1899 Convention. 

The PCA is headquartered in the world-renowned Peace Palace in The Hague, Netherlands.  Andrew Carnegie donated the funds to construct the building specifically for the PCA and a legal library.  Completed in 1913, the Peace Palace is also home to the International Court of Justice (ICJ), the Peace Palace Library, and the Hague Academy of International Law.

After an initial period of rapid growth during the first quarter of the twentieth century, the PCA was virtually inactive from World War II until the end of the Cold War.  It has experienced a dramatic resurgence since the late 1990s.  In 2000 the PCA had only 5 pending cases; in the fall of 2009 it had 35. 

This revitalization can be attributed to the diversification of the types of cases the PCA administers.  Originally intended to address disputes between states, the PCA now handles cases involving public and private parties, states and investors, parties within the same state (intrastate), and non-governmental organizations.  In 1993 and 1994 it adopted optional arbitration rules that provided a framework for the PCA to facilitate arbitrations outside of just state-state disputes.

Organization
“The PCA is not a court in the traditional sense, but a permanent framework for arbitral tribunals constituted to resolve specific disputes.”[i]  It is organized into three bodies, the Administrative Council, the Members of the Court, and the International Bureau.  The Administrative Council is responsible for overseeing the policies and budget of the PCA.  The budget for 2007/2008 was € 1.800.000 (roughly $2,600,000).  The Administrative Council is made up of the diplomatic representatives of PCA member states in The Hague.  As of November, 2009, the PCA had 109 members.  The newest member is the United Arab Emirates, which acceded to the 1907 Convention on November 6, 2008. 

The Members of the Court are potential arbitrators who may sit on a panel.  Each PCA member state may nominate up to four people with “known competency in questions of international law” to serve as “Members of the Court.”  Terms run for six years and can be renewed.  The Members of the Court include distinguished jurists, professors, and lawyers from around the world.  Judge Rosalyn Higgins, former President of the ICJ, is one of the Members from the United Kingdom.  Amb. Hans A.V. Corell, former Under-Secretary General for Legal Affairs at the United Nations, is part of Sweden’s “national group.”   The national groups from each country make proposals to the UN General Assembly for candidates to serve on the International Court of Justice. 

The Secretary-General of the PCA leads the International Bureau.  The Bureau provides support to the parties and arbitrators before, during, and after the arbitration process.  The tasks performed by the Bureau range including offering registry services and providing logistical and technical support during hearings and meetings.  The Bureau may also conduct legal research, act as the official channel of communications, appoint arbitrators, and advise parties who are thinking of using the PCA.

Conduct of Arbitrations
The Permanent Court of Arbitration offers dispute resolution services through arbitration, mediation, conciliation, and fact-finding, but nearly all of its activities are focused on arbitration. 

The panel of arbitrators for each case is constituted specifically for that case, and the disputing parties play a role in the selection.  The parties are not required to select arbitrators from the “Members of the Court.”  Most tribunals have three arbitrators, although they can range from one to five.  Under the 1976 UNICTRAL Arbitration Rules, (United Nations Commission on International Trade Law), a party to proceedings can request that the Secretary-General of the PCA designate the “appointing authority” to choose arbitrators, or if both parties agree, the Secretary-General himself can act as the “appointing authority.”  Between 2006 and 2010, the PCA is projected to receive 140 appointing authority requests.

PCA cases usually take place at the Peace Palace, but they can be held in a neutral location anywhere in the world.  The PCA has signed Host Country Agreements with several countries around the world (Argentina, Costa Rica, India, Lebanon, Mauritius, Singapore, and South Africa), which allow it to administer cases in the territory of the host country.  These agreements are meant to increase accessibility of PCA services, strengthen cooperation with regional institutions, and promote the use of arbitration facilities in the host country.

Arbitrations can be conducted in accordance with the procedural rules of the parties’ choice.  Quite often, the parties opt for the UNCITRAL Arbitration Rules, although they can use PCA Optional Rules, such as those for Arbitration of Disputes Relating to the Environment, or ad hoc rules of procedure.  For example, the Abyei Arbitration between the government of Sudan and the Sudanese Peoples’ Liberation Movement was conducted under the PCA Optional Rules for Arbitrating Disputes between Two Parties of Which Only One is a State (1993).

Parties do not pay overhead costs for use of PCA facilities, but they are responsible for the expenses that result from a case, which can include registry services, arbitrators’ fees, translation and interpretation fees, and catering.  In 1994 the Administrative Council created the Financial Assistance Fund to help offset the costs of arbitration for qualifying member states.  The fund is supported by voluntary contributions and has received donations from Costa Rica, Cyprus, France, Lebanon, the Netherlands, Norway, Saudi Arabia, South Africa, Switzerland, and the United Kingdom.

PCA decisions, like those of other arbitral tribunals, are final and binding.  The awards and case information are confidential unless the parties agree to publish the information.  They can do this in varying degrees, from allowing the PCA to identify only the names of the parties, lawyers, and arbitrators, to permitting access to case documents and webcasts of proceedings.

PCA Cases
Among the issues the Permanent Court of Arbitration handles are: territorial boundary disputes; armed conflict; human rights; maritime disputes; international investment; and sovereignty.  

Many of the recent state-state disputes before the PCA were initiated pursuant to the United Nations Convention on the Law of the Sea (UNCLOS).  The one state-state case now pending before the PCA is a dispute between the Kingdom of the Netherlands and the Czech and Slovak Federal Republic that concerns protection of investments.

The PCA has nine public-private cases pending, disputes to which at least one party is not a state or other public entity.  The Eurotunnel case went to arbitration pursuant to an agreement signed between the parties: The Channel Tunnel Group Ltd. and France Manche S.A. (Eurotunnel) on one side and the governments of France and the United Kingdom on the other.  The Arbitral Tribunal rendered a partial award in 2007 finding that Eurotunnel was entitled to damages from the governments, but chose to determine the amount at a later stage.  Eight of the nine pending cases are closed to the public, meaning not even the names of the parties have been released.

The well-known Abyei Arbitration is an example of a PCA administered intrastate dispute. The PCA served as the registry and provided administrative support in the arbitration between the Sudanese government and the Sudan People’s Liberation Army over whether or not the Abyei Boundaries Commission exceeded its mandate in determining the borders of the Abyei region in Sudan.  The parties deposited their arbitration agreement with the PCA on July 11, 2008, and by July 22, 2009, the tribunal rendered its award. The Abyei Arbitration was noteworthy because it was “an important use of arbitration shaped by international law to address a major dispute between a state and a region … the proceedings were unusually rapid and transparent.”[ii]

Over two-thirds of the PCA’s current caseload, 25 of the pending cases, is comprised of investor-states disputes.  This is the fastest growing area of PCA activity, and arbitral activity in general, due to the rapidly increasing number of bilateral and multilateral investment treaties being completed.  In only two of the cases have the parties agreed to make their names and representation public; the other 23 cases are closed.  Both Gallo v. Canada and Chemtura Corporation v. Canada are being conducted under Chapter Eleven of the North American Free Trade Agreement.

The Permanent Court of Arbitration is “perfectly situated at the juncture between public and private international law to meet the rapidly evolving dispute resolution needs of the international community”[iii] and will likely continue to play an active role in developing and shaping methods of international dispute settlement.


[i] Permanent Court of Arbitration – About Us – Structure.
http://www.pca-cpa.org/showpage.asp?pag_id=1039

[ii] Crook, John R.  “Abyei Arbitration – Final Award.”  ASIL Insights 13, no. 15 (September 16, 2009), http://www.asil.org/insights090916.cfm.

[iii] Permanent Court of Arbitration – About Us. http://www.pca-cpa.org/showpage.asp?pag_id=1027.

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ASIl & International Judicial AcademyInternational Judicial Monitor
© 2009 – The International Judicial Academy with assistance from the American Society of International Law.

Editor: James G. Apple.
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