Wolf Theiss lawyers Stefan Riegler, Dalibor Valincic and Oleg Temnikov analyse the involvement of state parties in arbitration, which may imply specific procedural issues. Concluding the discussion of the topics below is a short commentary on practical implications.

• Which rules apply?
• IBA Rules, Article 9
• Grounds of commercial or technical confidentiality in practice
• Special political or institutional sensitivity in practice
• Illegally obtained evidence and leaks of information
• Practical implications in taking evidence from state parties

Introduction

The involvement in arbitration of states, public authorities (such as government agencies, municipalities or other local authorities), or publicly owned enterprises may imply specific procedural issues. Indeed, the involvement of such public entities in arbitration led to the development of certain procedural mechanisms to secure their participation in a fair and balanced way. From bifurcation of proceedings to direct enforcement under the Convention on the Settlement of Investment Disputes between States and Nationals of Other States (the ICSID Convention), the approach has often been to create specific rules to address the standing of public entities. The interrelationship between the objectives of arbitration and the specifics of public entities, such as their immunities, the public interest objectives and considerations, have resulted in particularities widely discussed by scholars.

As concerns evidence, however, for a long time there were no particularly elaborated or detailed specific rules. The reason for this, at least in part, is the flexibility inherent in arbitration, which allows arbitral tribunals to use their discretion to account for the participation of public entities by adapting practices to the needs of a given arbitration procedure. Nevertheless, with an increase in arbitrations involving public entities, whether under investment protection instruments or under commercial contracts, some specific rules have emerged, which are also relevant to evidentiary issues.

When approaching the question of ‘special issues arising when taking evidence from state parties’, there are a couple of points about the possible nature of state parties that need to be taken into consideration. The most clear-cut example is when a state itself is taking part in proceedings, which is typically the case in investment treaty arbitrations. However, in international arbitration there are numerous examples of the respondent being a specific public authority (such as a government agency), a local authority (such as a municipality, federal unit of state or other local authority) or a fully or partially publicly owned enterprise. Although the rules of evidence may differ somewhat, such as in the case of sovereign immunity, which is often available only for the state itself, the general considerations relating to evidence bear some similarities and may be applied analogously.

The special issues around the taking of evidence in arbitration involving state parties are usually regarded from the perspective of obtaining evidence from a state party at the request of a private party. Indeed, arbitrations involving state parties are regularly asymmetric in their nature, as they involve private parties on the one side and state parties on the other. Therefore, even when the issues of taking evidence are considered in the context of a private party’s possibilities to obtain evidence from the state party, the asymmetry of the relationship may also create salient issues the other way round, that is when state parties produce evidence to which a private party would normally not have access.

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Original published in: Global Arbitration Review – The Guide to Evidence in International Arbitration