The aim of this contribution is to analyse the question
whether commercial arbitration is a better alternative to investment treaty
arbitration. This question has become very pertinent and urgent because
investment treaty arbitration is under increasing pressure from various sides.
Indeed, the pressure is apparently so high that the European Commission is
pushing to replace the classic ISDS system with the proposed international
court system (ICS), which has already become a reality in CETA and the
EU-Vietnam FTA. Moreover, some EU Member States have started to terminate some
of their investment treaties (in particular intra-EU BITs). Most importantly,
the European Commission’s intervention in preventing the execution of the Micula-award against Romania illustrates the general aversion against
ISDS within the EU. Given this hostile environment against arbitration based on
BITs, the question arises whether commercial arbitration could be a better
alternative than investment treaty arbitration? This question will be answered
by way of a comparing the recent developments in the Conoco v Venezuela, an ICSID case, and the parallel separate ICC case brought by a
pair of Conoco subsidiaries against PdVsa, the state oil company of Venezuela. The conclusion based on
this example is that commercial arbitration may be the better option for
investors – at least in this case.