Corruption Defense In Int'l Arbitration Could Backfire On Nation

Law360 (May 31, 2019, 8:43 PM EDT) -- Countries have increasingly begun to fight investors' arbitration claims by accusing the investors of corruption, prompting complicated questions about the allocation of blame and whether arbitrators should consider claims tainted by alleged misdeeds.

While information in publicly known cases shows that tribunals have generally rejected claims in which an underlying contract was found to have been procured through corruption, the approach has increasingly come under scrutiny as unfair to investors. Critics argue that corruption is a two-way street, and the automatic rejection of investors' claims denies them a forum for the dispute to be adjudicated.

But if tribunals begin taking a...

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