Corruption and access to justice in international law, Part 2
Our previous blogpost1 made a pointed enquiry into the extent to which international law provides an infrastructure of access to justice for individuals and communities harmed by corruption across multiple sectors of society. It took into account how it has proven difficult to have an exhaustive and universal definition of corruption given its intrinsic link to the socio-political and economic circumstances, among other things, across societies. The post also identified the challenges entailed in seeking to widen the definition of corruption in order to widen the scope of applicable legal action against corrupt individuals and institutions. As a follow up exercise, the current post seeks to examine whether the discourse on corruption has witnessed any evolution in spite of its definitional constraints. The following discussion will focus on a narrow yet contested aspect of judicial function through both case law as well as by making reference to both substantive treaty obligations and best practices.
It is important to recognize how international law has been continuously striving to combat corruption through various international treaties and instruments in the exigent battle against the growing menace of corruption. The Organization for Economic Co-Operation and Development Convention on Combating Bribery of Foreign Public Officials in International Business Transactions (‘OECD Anti-Bribery Convention’), the African Union Convention on Preventing and Combating Corruption (‘AUCPCC’), the Inter-American Convention Against Corruption (‘IACAC’), the United Nations Convention Against Transnational Organized Crime (‘UNCTOC’), the Council of Europe Criminal Law Convention on Corruption (‘CCLC’) and the United Nations Convention Against Corruption (‘UNCAC’) are some of the primary anti-corruption treaties and instruments that have been negotiated and are currently in force with a view to expand upon and settle on an all-encompassing scope of corruption and the legal remedies available to those suffering from it. The UNCAC, as emphasized upon in our previous blogpost, has emerged as a formidable ally in this campaign against corruption. Albeit an exercise in reiteration, the UNCAC is the first global and legally binding anti-corruption instrument.2 It calls for the inclusion of private actors to expand upon the definition of corruption into ‘an abuse of public or private power for personal benefit or improper benefit or the exercise of improper influence over those entrusted with public or private power3, without necessarily defining corruption.4 In doing so, it mandates greater obligations of transparency and disclosure through public reporting obligations5 and incentivizing self-reporting.6 The UNCAC relies on accomplishing several of these measures by relying on the integrity and transparency of judicial systems that is further envisioned in Art. 11.
However, it must be noted that the institutions that are entrusted with providing justice against the grievances caused by corruption are unfortunately not immune from the scourge itself. Within the spectrum of activities that amount to corruption and have a systemic adverse impact, judicial corruption is by far one of the most injurious towards an entity/individual’s access to justice. It is capable of percolating through several social and economic layers and thereby casting the darkest shadow.
Corruption in the court and tribunal systems has created an insurmountable crisis not only in the administration of justice but also in the functioning of other democratic institutions across the geo-political spectrum. And since corruption is directly linked to violation of human rights including access to justice, judicial corruption takes away the most fundamental redressal tool available to both individuals/entities.
Although there exist several elements to the anathema of judicial corruption, this post specifically wishes to explore the practice of double hatting through revolving doors as an extension of corruption being applicable to international legal practitioners, especially judges. The phenomenon of a revolving door is mostly seen in the field of international investment arbitration, wherein an individual may play multiple roles as that of the arbitrator, expert witness and counsel.7 It is this simultaneous or sequential movement between roles that has generated considerable debate on grounds of conflict of interest and is oftentimes referred to as ‘double hatting’.8 This practice although is synonymous with the international investment community, however, has drawn the attention of international institutions such as the ICJ which clarified its rules on the participation of its judges in international investment arbitration proceedings.9 One might also consider Art. 16(1) of the ICJ Statute alluding to a similar provision prohibiting any member of the Court from exercising any political or administrative function or engage in any other occupation of a professional nature. However, this never stopped both serving as well as former ICJ judges from accepting arbitration appointments. This not only brought their duties as an ICJ judge under scrutiny, but also raised concerns regarding the independence and impartiality of the judges with respect to being compensated by their respective parties to an arbitration.10 The Court of Arbitration for Sport (‘CAS’) became one of the first institutions to take a stand against the practice of double hatting way back in 2009.11 The CAS amended its regulations to prevent the likelihood of an arbitrator favoring a recurrent counsel appointment across multiple cases, thus prompting other institutions to weigh in.12
Similarly, in ISDS cases, it is the ‘public law’ nature of arbitrations which fuels concerns regarding transparency and conflicts of interests raised by the revolving door phenomenon.13 Recently, ICSID and UNCITRAL released a Draft Code of Conduct for Adjudicators applicable to ISDS cases.14 The Draft Code although does not impose a blanket prohibition on double hatting15, however, it does impose an obligation on the arbitrators to either refrain from acting, or disclosing their involvement in a significant capacity on matters involving the same parties (with the possibility of expanding this to include matters involving the same facts and/or treaty).16
A case that recently ignited the debate around an arbitrator’s duty of disclosure, among other things is the UK Supreme Court’s decision in Halliburton Company v. Chubb Bermuda Insurance Ltd (formerly known as Ace Bermuda Insurance Ltd).17 This case relates to an arbitration arising out of the Deepwater Horizon drilling rig oil spill accident in 2010, pursuant to which there was not just significant loss of life and massive environmental damages but thousands of civil claims were filed against BP Exploration and Production Inc (‘BP’) , Halliburton Company (‘Halliburton’) and Transocean Holdings LLC (‘Transocean’).18 Transocean, as the manager and operator of the rig had leased it to BP. Halliburton was in charge of providing cementing and well monitoring services on the rig.19 BP in turn claimed against Halliburton and Transocean, both of which held insurance policies with Chubb Bermuda Insurance Ltd (‘Chubb’). This led to 3 concurrent arbitrations. However, the current discussion pivots on the resulting arbitration between Halliburton and Chubb arising out of Chubb’s rejection of Halliburton’s insurance claims under a Bermuda Form liability policy. Mr Kenneth Rokison QC was subsequently appointed by the English High Court as the third arbitrator in the Halliburton Arbitration as the parties could not agree on a presiding arbitrator.20 What merits attention here is that Mr. Rokison went ahead and accepted arbitration appointments in the other 2 arbitrations as well (between Transocean and Chubb and between Transocean and a third-party insurer). These were subsequent appointments and were not disclosed by Mr. Rokison to Halliburton. Halliburton requested Mr. Rokison’s resignation from the tribunal on becoming aware of these later appointments, which Mr. Rokison did not abide by. Eventually, Halliburton applied to the High Court seeking removal of Mr. Rokison under Sec. 24(1)(a) of the Arbitration Act, 1996 alleging perceived bias. Upon the High Court’s refusal of Halliburton’s application, the Court of Appeals also dismissed Halliburton’s appeal and subsequently and in light of the issues at stake, the Supreme Court decided to hear the appeal.21
The Supreme Court relied on both established case laws22 and best practices and codes of conduct of several international bodies23 while determining the threshold for apparent bias and examining situations to determine if disclosure was necessary in the face of apparent bias. The Supreme Court finally found that although disclosure should have been made in alignment with the extant best practices, however, the lack of it alone would not necessarily lead a fair-minded and informed observer to infer a real possibility of bias.24 The Supreme Court’s final ruling in this case has given way to considerable discussions around an arbitrator’s impartiality and unconscious bias. The crux of the ruling, while seeks to respond to the questions before it and thereby laying the jurisprudence, it also reinforces the obligations contained in the codes of conduct of other international bodies in the process. A recent ruling25 by the Court of Appeal, much on the lines of the reasoning adopted in the afore-discussed Halliburton case, laid down guidelines for courts on matters of conflict of interest. While ruling on the specific aspect of ‘expert witnesses’, the Court of Appeal observed that a conflict of interest is a matter of degree26, thus leaving room for the application of such principle to develop through best practices. Aspects of confidentiality and disclosure may not find their mention in legislations and are therefore often difficult to enforce, however, best practices and jurisprudence can often close legislative gaps.
Upon a preliminary perusal, a link between this case and our aforesaid discussion on judicial corruption may not be evident. However, a considered discussion on matters of impartiality, transparency, disclosure and confidentiality of judges and arbitrators, among other things, by the Supreme Court and the consequently developing literature around these, can lead to an incisive understanding of the dynamics of this particular facet of judicial corruption and the potential impact it can have on the concerned parties if left unchecked. It also remains to be seen if the aftermath of decisions like this can facilitate in the reevaluation of existing institutional anti-corruption measures and in the identification of blind spots in the present instruments.
In addition to the likelihood of running afoul of obligations of transparency and disclosure, revolving doors and double-hatting may also have certain ancillary pitfalls. The number of female arbitrators comprise of a very measly percentage of a homogenous group of white, male arbitrators and judges.27 An already dismal statistic becomes even more egregious when maximum appointments are sought from the very same homogenous pool and all movement across matters and fora is monopolized by the members of said pool. The argument for this glaring issue of gender diversity can also be extended to a complete lack of regional diversity. Arbitrators and judges appointed by parties in investment or commercial arbitrations are primarily from the Global North (comprising of Western Europe and North Americas).28 It can be further argued that the lack of competent professionals from all other regions is not just another signpost of western hegemony but also an instance of institutional failure towards facilitating diverse representation. The larger question of inadequate gender and regional representation itself is intimately tied to the idea of justice. A homogenous group of people will have the tendency to advocate for and safeguard only very specific set of interests and perspectives and therefore impact any consequent decision making accordingly. Such decision making can act as a barrier to securing justice for those who are already marginalized and underrepresented, thereby making access to justice partial and restricted.
Finally, corruption cannot be understood to exist in a vacuum outside of any system. It has to be identified and addressed within a given system of norms and processes. Corruption as a menace has evolved with time and thus it is imperative to equip existing infrastructures in place to keep up. Institutional practices with an inclination to accommodate power imbalances and overlook concentration of power, if left unchecked, may foster newer forms of corruption. The Halliburton case although dealt with issues of disclosure and transparency with caution, it did not lay down any strict guidelines thereby leaving room for future interpretation of these principles. Therefore, enforcement of these principles and obligations can be better accomplished in the backdrop of strong and independent judicial systems. An impartial system is a sine qua non in not only holding perpetrators of corruption accountable but also in securing justice for those who are affected by it. Therefore, it is imperative that any individual or body discharging either judicial or quasi-judicial functions remains free of any influences and biases that may render it incompetent and short-sighted in ensuring access to justice.
1 Corruption and access to justice in international law, Part 1, available at https://just-access.de/corruption-and-access-to-justice-in-international-law-part-1/#sdfootnote6anc
3 Eds. Rose et al, UNCAC Commentary, 3, 4.
4 Eds. Cecily Rose, Michael Kubiciel and Oliver Landwehr, The United Nations Convention Against Corruption: A Commentary (Oxford, 2019), 23 on debates during drafting that led to this feature.
5 Art. 10; Eds. Rose et al, UNCAC Commentary, 107-8.
6 UNCAC Arts. 37 and 39.
7 See Malcolm Langford, Daniel Behn, Runar Hilleren Lie, ‘The Revolving Door in International Investment Arbitration’ Journal of International Economic Law, 2017 at p. 1.
8 Ibid while quoting Phillipe Sands, ‘Conflict and Conflicts in Investment Treaty Arbitration: Ethical Standards for Counsel’, in Arthur Rovine (ed.), Contemporary Issues in International Arbitration and Mediation: The Fordham Papers (New York: Brill, 2012), at 28–49; Phillipe Sands, ‘Developments in Geopolitics – The End(s) of Judicialization?’ 2015 ESIL Conference Closing Speech, 12 September 2015.
9 Ibid; see also https://www.icj-cij.org/en/other-texts/compilation-decisions
10 Nathalie Bernasconi-Osterwalder and Martin Dietrich Brauch, “Is ‘Moonlighting’ a Problem? The Role of ICJ Judges in ISDS”, Nov. 2017, IISD. https://www.iisd.org/articles/moonlighting-problem-role-icj-judges-isds
11 Clarissa Coleman, ‘Two Heads Are Better Than One: Double Hatting and Its Impact on Diversity in International Arbitration’, The National Law Review, Vol. XI, No. 88 (2020), available at https://www.natlawreview.com/article/two-heads-are-better-one-double-hatting-and-its-impact-diversity-international
13 Stephan Schill, ‘Enhancing International Investment Law’s Legitimacy: Conceptual and Methodological Foundations of a New Public Law Approach’, 52 Virginia Journal of International Law 57 (2012).
14 Vanina Sucharitkul, ‘ICSID and UNCITRAL Draft Code of Conduct: Potential Ban on Multiple Roles Could Negatively Impact Gender and Regional Diversity, as well as Generational Renewal’, Kluwer Arbitration Blog (2020), available at http://arbitrationblog.kluwerarbitration.com/2020/06/20/icsid-and-uncitral-draft-code-of-conduct-potential-ban-on-multiple-roles-could-negatively-impact-gender-and-regional-diversity-as-well-as-generational-renewal/; also see https://icsid.worldbank.org/sites/default/files/amendments/Draft_Code_Conduct_Adjudicators_ISDS.pdf
15 Supra note 11.
16 Art. 6 of the Draft Code, available at https://icsid.worldbank.org/sites/default/files/amendments/Draft_Code_Conduct_Adjudicators_ISDS.pdf
17  UKSC 48.
18 Ahmed Durrani, ‘Halliburton v Chubb: Arbitrator’s duty of disclosure and appearance of bias’, ICAR (Jan 2021), available at https://www.investmentandcommercialarbitrationreview.com/post/halliburton-v-chubb-arbitrators-duty-of-disclosure-and-appearance-of-bias
19 James Dingley, Anokan Ghosh, ‘Halliburton v. Chubb – An International Perspective: New-found Clarity Or Continued Uncertainty?, Jan 2021, available at https://www.mondaq.com/russianfederation/trials-appeals-compensation/1022228/halliburton-v-chubb–an-international-perspective-new-found-clarity-or-continued-uncertainty
21 Ruth Keating, Samar Abbas Kazmi, ‘The axiom of impartiality: Halliburton v Chubb’, IBA (2021).
22 Porter v Mgill  UKHL 67.
23 The IBA, GAFTA, ICC, as well as LMAA, ICA, LCIA, CIArb to state a few.
24 Supra note 19.
25 Secretariat Consulting PTE Ltd & Ors v A Company  EWCA Civ 6.
26 Supra note 21.
27 Supra note 14.