State responsibility and the enforcement of arbitral awards

The place of arbitration as a dispute resolution mechanism for disputes involving states and investors depends upon the value accorded to a valid award. Many states voluntarily comply with awards rendered against them. However, the occasions of non-compliance may result in the incurrence of international responsibility by states pursuant to both customary and treaty norms. This article considers some of these norms, as well as the bases on which states dispute responsibility for non-enforcement of arbitral awards or avoid execution. To this end, the various sections of this article examine: (i) the relevance of customary norms of state responsibility to investment arbitration; (ii) scenarios in which the refusal of national courts to enforce arbitral awards have been found to incur state responsibility by breaching an investment treaty; (iii) scenarios in which a state’s refusal to respect an award rendered against it by an investment tribunal might incur international responsibility and relevant issues such as immunity; and (iv) the role of the International Court of Justice and, its predecessor, the Permanent Court of International Justice in upholding the integrity of arbitral proceedings, including by adjudicating the validity of arbitral awards rendered against states.