International Investment Arbitration Part 2

B. Treaty Claims/Contract Claims – "Umbrella Clauses"

The question has arisen in a number of ICSID arbitrations whether the ICSID tribunal has jurisdiction to resolve claims based on a breach of contract as opposed to claims amounting to breaches of international law standards. The relevant contract may frequently include a jurisdiction clause which refers contractual disputes to another forum.

In Lanco International Inc. v. Argentine Republic²⁸ the underlying contract between the investor and an agency of the Argentine government contained an exclusive jurisdiction clause submitting contractual disputes to a domestic administrative court in Argentina. The tribunal relied on Article 26 of the Convention which provided that consent to ICSID arbitration is "to the exclusion of any other remedy". The tribunal held that the exclusive jurisdiction clause in the contract did not prevent the submission of disputes to ICSID. Moreover, the tribunal considered that the contractual