Revealing Not-for-Profit Third-Party Funders in Investment Arbitration

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Blog Post

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Oxford University Press




The traditional view of investment arbitration tribunals is that the mere presence of a third-party funder has no effect on the arbitration proceedings. For example, the tribunal in Oxus Gold plc v Republic of Uzbekistan, UNCITRAL, Final Award, 17 December 2015, para 127, articulated the traditional view that third-party funding has no impact on the merits portion of the arbitration process: "It is undisputed that Claimant is being assisted by a third-party funder in this arbitration proceeding. The Arbitral Tribunal has mentioned this fact in its Procedural Order Nos. 6 and 7. However, this fact has no impact on this arbitration proceeding." The treatment of third-party funding may vary from tribunal to tribunal, however, since there are arguably no mandatory substantive precedents in investment arbitration regarding third-party funding. Nevertheless, most tribunals that have addressed third-party funding in their awards – if at all – have done so on the assumption that the funder is a separate entity from the funded party and has profit-making as its primary motive. Because of the traditional third-party funder’s status as a mere financier, tribunals have essentially been able to simply acknowledge the presence of the funder and move on to addressing other aspects of the case.

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