Revue - Les Cahiers de l'Arbitrage N°2 - 2023 - 20

AFRICA SPECIAL ISSUE
exchange of letters was binding on the parties. A dissent by Mohamed Bedjaoui,
the arbitrator appointed by Guinea-Bissau, evoked the effects of colonisation
in fomenting the dispute. The matter did not stop there. Guinea-Bissau, to
circumvent the finality of the award, pursued the matter at the International
Court of Justice. 49
Turning to investment arbitration, which is only briefly mentioned here as
it is covered elsewhere in this special edition, we see that African states have
increasingly become respondents in disputes involving foreign investors as
claimants. Here, one can distinguish between disputes arising out of investment
contracts between investors and states, disputes arising out of BITs concluded by
African states and the home states of investors, and disputes based on domestic
investment laws. In the 1970s and 1980s an African state - Libya - was at the
centre of the controversy about the internationalisation of contracts. 50
Libya, 51
a claim arising out of Libya's nationalisation of a foreign investor's interests,
the concession contract at issue referred to general principles of international law.
The sole arbitrator determined this reference was enough to conclude that Libya
contemplated a law other than its domestic law to apply to the contract, and went
on to decide that public international law was the proper law of the contract. 52
At
the time, this decision was controversial. In recent times, the internationalisation
of contracts is a moot point because investment contracts routinely include clear
choice-of-law clauses. Many investor-State disputes in Africa continue to be based
on investment contracts, but this area remains understudied. 53
In contrast, disputes
arising out of BITs have captured the imagination of commentators in Africa, as
elsewhere. The vague, broad provisions in the earlier generations of BITs have
allowed investors to claim that states have breached a wide range of obligations.
Many of these obligations, states argue, had not been foreseen at the time of
49. Guinea-Bissau asked the ICJ to find that the decision in the award was non-existent because
one of the arbitrators making up the majority had appended a declaration contradicting the majority
decision, that the decision was null and void because the tribunal did not answer the second part of
the question posed to it, and finally that Senegal was not justified in asking Guinea-Bissau to apply
the award. The ICJ rejected Guinea-Bissau's applications and found (by majority) that the arbitral
award of 31 July 1989 was binding on Guinea-Bissau and Senegal.
50. Christopher Greenwood, State Contracts in International Law - The Libyan Oil Arbitrations,
The British Yearbook of International Law 1982, Volume 53, Issue 1 (1982); Muthucumaraswamy
Sornarajah (2015), The precursor of neoliberalism: Internationalization of foreign investment
contracts. In Resistance and Change in the International Law on Foreign Investment (pp. 78-135).
Cambridge: Cambridge University Press; Sornarajah, Muthucumaraswamy, " The Battle Continues:
Rebuilding Empire through Internationalization of State Contracts " , in Jochen von Bernstorff,
and Philipp Dann (eds), The Battle for International Law: South-North Perspectives on the
Decolonization Era, The History and Theory of International Law (Oxford, 2019; online edn, Oxford
Academic, 19 Dec. 2019); Lim, C., Ho, J., & Paparinskis, M. (2021). Investment Contracts and
Internationalisation. In International Investment Law and Arbitration: Commentary, Awards and other
Materials (pp. 37-56). Cambridge: Cambridge University Press
51. Texaco Overseas Petroleum Company and California Asiatic Oil Company v The
Government of the Libyan Arab Republic (Award of 1977).
52. See also, In the related cases, Libyan American Oil Company (LIAMCO) v Libya, Award of
1977 in which the sole arbitrator, Dr Sobhi Mahmassani decided that the proper law of the contract
was Libyan law moderated by international law and BP Exploration Company (Limited) v Libya,
Award of 1973 in which Judge Gunner Lagergren decided that the propert law of the contract was
general principles of law.
53. The author is working on research project in which she studies these disputes. The research
should be published in 2024.
294
The Paris Journal of International Arbitration 2023‑2
In Texaco v

Revue - Les Cahiers de l'Arbitrage N°2 - 2023

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