In this chapter, Tarcisio Gazzini and Alessandra Pietrobon focus on parallel proceedings in investment and human rights claims. This chapter examines how tribunals co-ordinate the exercise of their jurisdictions, how they should deal with the merits (including applicable law and issues of interpretation), and how they should avoid double recovery. The complex disputes related to Yukos are discussed with a view to formulating some tentative recommendations on how to manage parallel proceedings before the European Court of Human Rights and investment arbitral tribunals.

The occurrence of parallel proceedings involving the same dispute and the same parties in international commercial arbitration is a well known phenomenon. In particular, this scenario arises when two identical proceedings regarding jurisdictional matters and/or the merits of the case are pending at the same time before a state court and a foreign arbitral tribunal, or before two arbitral tribunals seated in different jurisdictions. In order to prevent the undesirable effects of the proliferation of proceedings (namely the risk of lengthy and costly proceedings and the risk of irreconcilable decisions), different tools can be deployed. The analysis of the techniques most frequently employed to address this problem shows that many of the procedural mechanisms available are ill-suited, given the specificity of international commercial arbitration. Hence, the undisputed emergence of international arbitration as a reliable and effective alternative to court litigation and the judicial policy of minimal interference with the arbitration process suggest that a pro-arbitration approach in dealing with the lis pendens issue should be embraced. As regards the situation of lis alibi pendens before a state court and a foreign arbitral tribunal, this entails the prioritarization of arbitral tribunals over national courts as long as a dispute covered by a prima facie existent arbitration agreement is brought before an arbitral tribunal. Conversely, in a scenario in which proceedings are already pending before a national court, it is suggested that a (foreign) arbitral tribunal should be entitled to stay proceedings in order to avoid protracted and expensive parallel litigation, although it is certainly not to bound to do so, at least in the absence of a joint request by the parties or in presence of a clear waiver of the arbitration agreement. A comparable flexibility should also guide the solution to be adopted in parallel arbitral proceedings, where the tribunal second seized should be free to act according to case management considerations.

This chapter explores forum choice at the international and regional levels, advancing three arguments. First, forum shopping as an arbitrary exercise or an exercise bordering on abuse of rights is rare. Second, parties nearly always have legitimate reasons for their forum choice. Factors impacting forum choice include receiving a favourable decision, the finality of that decision and the prospects for enforcement. As regulators, states should deal with the challenge of overlapping jurisdiction among international courts and tribunals (ICTs) by regulating forum choice explicitly. Third, ICTs have to assess the reasons proffered by the litigating parties, whereby they may consider precedent-setting and long-term repercussions, so as to accept or decline jurisdiction. Forum shopping can raise issues of legitimacy, fairness, cost and integrity. Forum choice, however, is a fundamental obligation of counsel to a client, in order to search for the tribunal or jurisdiction that will best recognize its rights, consistent with the fair administration of justice. Healthy competition between jurisdictions is overall beneficial to the evolution of ICTs.

This chapter continues to focus on procedural rules in Chinese BITs. Classic issues in international commercial arbitration such as parallel proceedings also emerge in international investment arbitration. The parallel existence of international investment arbitration and domestic litigation deserves careful analysis for the sake of international legal certainty and security. Given the small number of international investment arbitration cases involving China and its BITs, the issue of parallel proceedings in Chinese BIT law and practice is underinvestigated. The chapter looks into this issue by reference to the case of Hela Schwarz GmbH v. PR China, an ongoing BIT arbitration case registered with the ICSID. Some improvements have been made to relevant jurisdictional clauses in China’s more recent free trade agreements, filling the gap in this gray area.

Chapter 6 focusses on causes of action in investment arbitration, including the distinction between contract and treaty claims and the notion of ‘fundamental basis of the claim’. The chapter disputes the alleged independence between contract rights and obligations, on the one hand, and treaty rights and obligations, on the other. Tribunals need to recognize substantive overlaps between contract and treaty claims when addressing the substance of IIA claims. Thus, parallel local proceedings, all the provisions of the relevant contract (including forum selection clauses), and the conduct of both contractual parties are relevant factors in deciding the admissibility of treaty claims.

This chapter analyses what is probably the biggest concern raised by shareholders’ claims for reflective loss: parallel proceedings and the risks they engender such as inconsistent decisions and double recovery. Parallel proceedings, which can lead to double recovery and inconsistent or contradictory decisions, can severely impact the legitimacy of international investment arbitration by creating uncertainty, inconsistency, and unfairness. This chapter scrutinizes the different types of parallel proceedings to which shareholders’ claims for reflective loss can lead. It also undertakes an in-depth analysis of the dangers created by parallel proceedings. Finally, this chapter focuses on a specific instance of parallel proceedings involving proceedings before domestic courts and international courts or tribunals. In particular, it is explained why traditional claim-limiting provisions found in international investment agreements are of limited practical use in the context of shareholders’ claims for reflective loss.

A recurring theme is the legitimacy and harmonization of jurisprudence among international courts and tribunals. In this context, an important procedural consideration is so-called forum shopping; a strategy by which litigants pursue parallel or sequential proceedings, among multiple jurisdictions, in order to achieve the most favourable result. This chapter explores the differential treatment of forum shopping between the specialized regimes for human rights and the investor-State dispute settlement (ISDS) regime. It contends that the notable contrast between the restrictive rules applicable to individual human rights complaint procedures and the laissez-faire approach of the ISDS regime is instructive as to the place of human rights in the praxis of the international legal order; a procedural privileging of secondary human rights norms such as property rights over the most fundamental jus cogens norms such as the prohibition of extra-judicial executions and torture. The shift from norms to procedures provides a more honest picture of where the contemporary international legal order stands in regard to the fundamental principles that it espouses as unimpeachable axioms.