DISPUTE RISK MANAGEMENT
CD: In your opinion, what are the notable trends and developments shaping the dispute risk management landscape in recent months? What types of dispute seem to be frequently occurring?
Rose: The major dispute risk management developments in Australia in recent months have centred around the examination of conduct issues by the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry, together with a report by the Australian Prudential Regulation Authority (APRA). The Commission’s work and the APRA report have interrogated dispute risk management systems and processes, and how those systems are implemented by organisations, as well as how boards and senior management ensure appropriate controls are in place for financial and non-financial risks. Australian corporations are increasingly subject to class action risk with evolving litigation funding models and competing class actions.
Rubinstein: A key trend affecting the cross-border dispute resolution landscape is the increasing number of attacks on the existing framework of investor-state dispute resolution that has been in place since the adoption of the ICSID Convention in 1965. The system has involved the use of international arbitration to enforce investor protections guaranteed through investment treaties and free trade agreements. Over the past several years, there has been a notable trend toward the dismantling of this framework, leading to the gradual erosion of protections of foreign investors. We have seen this trend manifest itself through the attempted replacement of investor-state arbitration with alternative models, most notably the model advocated by the European Union (EU) of establishing bilateral or multilateral investment courts consisting of full time judges. The European Court of Justice’s 2018 ruling in Slovak Republic v. Achmea, which invalidated arbitration agreements in intra-EU bilateral investment treaties (BITs), has led to the repudiation of intra-EU BITs.
Jan-Mar 2019 issue
Clayton Utz
Freshfields Bruckhaus Deringer LLP
Kirkland & Ellis LLP
M&S Law Sàrl