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TDM Call for Papers Special Issue on "Sanctions and International Arbitration: Impact on Substantive and Procedural Issues"

3 January 2023

Call for papers for a Special Issue of Transnational Dispute Management (TDM, ISSN 1875-4120) titled "Sanctions and International Arbitration: Impact on Substantive and Procedural Issues".

The use of multilateral and unilateral sanctions has proliferated as a consequence of states' attempts to ensure compliance with international law obligations in the pursuit of peace and security, to prevent human rights abuses and corruption, and, more recently, and increasingly, the pursuit of geopolitical and geoeconomic objectives. Consequently, sanctions on individuals and legal entities worldwide have increased in number and scope.[1] Sanctions have a long history that traces back to ancient Greece, but in recent years, with the new geoeconomic Word Order, various measures used as an economic weapon are a reality in international affairs. The measures imposed include the freezing of assets of individuals and legal entities, prohibition of entry, the banning of transactions with various entities, and restrictions or bans on the import/export of goods and services. Sanctions often have adverse effects on the targeted parties, including states, but more specifically, individuals and companies, and third parties that engage in business activities with those individuals and companies.

International arbitration agreements are commonplace in investor-state and commercial contracts, and when sanctions are imposed, a host of questions on the impact of sanctions on disputes arising from such international contracts emerge. Arbitration practitioners have had to contend with different sanctions regimes, including those relating to Cuba, the Islamic Republic of Iran, Iraq, Libya and Venezuela. Arbitration practitioners have occasionally been the target of unilateral sanctions. Recent geopolitical events have brought a renewed focus to the issue of sanctions and international arbitration.

Sanctions impinge on arbitration practice, and significantly affect participants in arbitration - including parties and their counsel, arbitrators and arbitral institutions. Sanctions add to the complexity of transnational disputes and seriously affect their resolution. Moreover, sanctions overshadow contracts and agreements between the sanctioned parties and, in many cases, make their implementation difficult or even impossible.

In the current state of geopolitical affairs, it is likely to expect a greater reliance on sanction regimes. Against this background, and considering international trade and investment obligations, either at the multilateral level, and at regional and bilateral levels in FTAs and investment treaties, we invite authors to explore the effect of sanctions on the conduct of international arbitration, on both the procedure of arbitration and on the merits of a dispute.

We welcome submissions which address these and other relevant topics:

International Commercial Arbitration

• General overview: the origins of economic sanctions and their effect on international arbitration;
• Impact of sanctions on arbitration process: appointment and payment to arbitrators, the appointment of legal representatives and payment of legal fees, experts, payment to arbitral institutions;
• Arbitrability of disputes (e.x. La Compagnie Nationale Air France v. Libyan Arab Airlines);
• Exclusive jurisdiction of state courts over sanctioned persons (e.x. Federal law of Russia (No.171-FZ) establishes exclusive jurisdiction of the Russian state commercial courts with respect to disputes involving sanctioned Russian individuals and entities, as well as foreign entities controlled by them, and disputes arising out of sanctions against Russia).
• Issues of neutrality, impartiality, and independence of arbitrators. Challenges due to the personal opinions of arbitrators.
• Practical effects on arbitral institutions, arbitrators and parties to the arbitration;
• Risks associated with the application of sanction legislation to arbitral institutions, arbitrators and legal counsels;
• Risks associated with the application of sanction legislation by arbitrators. Are arbitrators obliged to consider sanctions legislation?
• How arbitral institutions deal with the issue of sanctions (Arbitral Institutions' Policies, Guidelines and Rules (ex. HKIAC Sanctions Policy, LCIA License and Note for parties);
• Validity of an arbitral award (International Chamber of the Paris Court of Appeal (N° RG 19/07261 - 35L7-V-B7D-B7VDG) case - violation of UN Security Council Resolutions, as well as EU Regulations that impose economic sanctions against Iran, can be used as the basis for a plea for annulment because they fall under French international public policy);
• Public policy (e.x. in Iran Defense Ministry v Cubic Defense Systems, Inc. (2011), a party argued in a US court that the ICC award of USD 2 million in favour of the Iran Defense Ministry "was contrary to a fundamental public policy of the US against trade and financial transactions with the Islamic Republic of Iran");
• Third-party funding in cases involving sanctioned parties;
• Enforcement of awards against the blocked assets of sanctioned parties (e.x. Crystallex case);
• Impact of sanctions on enforcement in the context of international arbitration.

Investment Arbitration

• The legal nature of sanctions and their effect on investment arbitration;
• The jurisdictional basis for investment claims by companies affected by sanctions;
• Jurisdictional issues (e.x. Stati v. Kazakhstan case);
• Admissibility issues (principles of transnational public policy and the doctrine of clean hands);
• Relevant standards of treatment (illegal expropriation, indirect expropriation, violation of other standards of protection, such as non-discrimination; full protection and security; and fair and equitable treatment);
• Impartiality and independence (Pezold v. Zimbabwe);
• Economic sanctions as a defence in arbitration;
• Recognition and enforcement obstacles (sovereign immunity, public policy).

Effects of Sanctions on the Substance of a Dispute

Both sanctioned parties and their contractual counterparties may face breach of contract disputes when imposed sanctions prevent contract completion. Some contracting parties may look to the sanctions imposed to justify their non-performance.

• Doctrine of Frustration;
• Doctrines of impediment and hardship;
• Force Majeure;
• Contract illegality (e.x. Kashani v. Tsann Kuen China Enterprise Co: non-performance of a contract requiring shipment of US-manufactured computers to Iran did not give rise to a claim because the agreement was illegal under US sanctions and against public policy);
• Assessment of damages.

These - and other pertinent issues - could be reviewed both from national and international law perspectives. Authors are also invited to submit case reports and comments.

The Co-editors:

Timeline and submission guidelines:

1. May 31, 2023 - Recommended deadline for first submission of drafts;
2. August 31, 2023 - Deadline for final submissions and publication of the issue on TDM.

Proposals, along with authors' profiles (150-200 words), should be submitted to Rinat Gareev and Dr Dini Sejko  - see contact details here - via email and copied to info@transnational-dispute-management.com.

An abstract of the proposed paper should be submitted at your earliest convenience. Articles accepted for publication before this deadline will also go through TDM's on-line advance publication process, allowing your work to reach its target audience as soon as the paper completes peer review and the editing process.

The minimum word count of articles should be 5000 words (excluding footnotes, endnotes, appendices, tables, summary etc.). Articles should include summaries (150-200 words). The layout of the articles should conform to TDM's submission guidelines available at: www.transnational-dispute-management.com/contribute.asp (more information available upon request). For citations, follow OSCOLA (4^th Edition) www.law.ox.ac.uk/research-subject-groups/publications/oscola.

Feel free to circulate this call for papers amongst friends, colleagues and other people who you think may have an interest in this topic.

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