Developing Diversity within Diversity Discourse: Remembering Non-Lawyers in Arbitration, in Asia and Beyond

This is the title of a presentation (Powerpoints in PDF here) for the 28-29 May 2022 19th ASLI Asian Law Conference, hosted this year by the University of Tokyo, based on an empirical study by myself, ANJeL-in-ASEAN convenor Asst Prof Nobumichi Teramura, and USydney research assistant James Tanna. It adds some directly Asia-related data to the analysis presented in a forthcoming chapter in Shahla Ali, Giorgio Colombo et al (eds) Sustainable Diversity in International Arbitration (Elgar, mid-late 2022), with a longer paper available via SSRN and a posting summarising key empirical findings via Kluwer Arbitration Blog.

Our presentation for ASLI also suggests that given the relative influence still of law professors in developing international arbitration in Asian states, particularly perhaps those more influenced by the civil law tradition, the large and growing dominance of full-time lawyers across the field may have a significant indirect impact on international arbitration in Asia.

Presentation Abstract: This paper, co-authored with Asst Prof Nobumichi Teramura (UBrunei) and James Tanna (USydney), highlights a curious lack of diversity within the proliferating discourse about the lack of diversity in international arbitration. There is hardly any awareness or at least sustained discussion about limited diversity of professional backgrounds, and more specifically the dominance nowadays of those with practising lawyer positions or primary careers – including more recently in Asia – across the key groups and publication outlets for international arbitration. Yet this encroachment of lawyers was still being contested in the 1990s, as being linked to burgeoning costs and delays, and such “formalisation” has been re-emerging in recent years. Diversifying the world of international arbitration to involve more non-lawyers, including academics, could promote various other objectives too, and thus enhance the legitimacy and sustainability of international arbitration.

This paper therefore analyses empirically the ways lawyers have come to dominate key nodes of influence within the world of international arbitration. We examine this worldwide and in the Asian region, thus also giving a sense of geographical diversity. Part I looks at lawyers in key general associations or organisations promoting international arbitration, including their leadership and presenters at symposiums. Part II focuses on various arbitration centres globally and regionally, which actually administer cases. Part III examines contributions to some key arbitration journals (including the Asian International Arbitration Journal), an influential book series, and a widely-read Blog. The conclusion reiterates that restoring more non-lawyers in the world of international arbitration should help not only to reduce formalisation and inefficiencies in international arbitration, but also have various other salutary effects, including potentially improving gender diversity.

Corruption and Illegality in Asian Investment Arbitration

Written by: Asst Prof Nobumichi Teramura (UBD-IAS, CAPLUS affiliate) and Luke Nottage

[Updates: I have co-authored draft introductory and Thailand chapters for this book project proposed with Springer, and will present them at an invitation-only webinar for book contributors hosted by UBrunei on 15 June 2022, as well as at Griffith University’s Law Futures Centre on 21 July 2022.]

The Institute of Asian Studies at the Universiti Brunei Darussalam (UBD-IAS) has recently funded a conference volume project on this important topic, involving several professors from the Centre for Asian and Pacific Law at the University of Sydney (CAPLUS).

Bribery and other serious illegal behaviour by foreign investors are widely condemned in any society. The problem is that people seem not to have reached a consensus on the consequences of corruption and illegality in international investment and especially in investment arbitration – a transnational procedure to resolve disputes between a foreign investor and a host state. A core issue is whether a foreign investor who violated a host state’s law would be awarded protection of its investment, as per its contract with the host state and/or the applicable trade or investment agreement between the home state and the host state. Some suggest such protection would be unnecessary, as the investor committed a crime in the host state, while others attempt to establish an equilibrium between the investor and the host state. Some others claim to protect investment, invoking the sanctity of promises made. This research explores ‘Asian’ approaches toward the issue, considering the extent to which significant states in Asia are likely to become ‘rule makers’ rather than ‘rule takers’ regarding corruption and serious illegality in investor-state arbitration. To this end, we will employ a comparative method, inviting scholars from the Asia-Pacific region, including UBD-IAS and other institutions.

The Principal Investigator is Dr Nobumichi Teramura, the Co-Principal Investigator is Assoc Prof Bruno Jetin (UBD-IAS Director), Luke Nottage (appointed also now a Visiting Professor at UBD) is another contributor and the others are listed below. Many have previously worked together on related Asia-focused projects, notably their co-edited volume with Shahla Ali on New Frontiers in Asia-Pacific International Arbitration and Dispute Resolution (Wolters Kluwer 2021) and Luke Nottage’s book co-edited with Julien Chaisse on Investment Treaties and International Arbitration Across Asia (Brill, 2018; expanding on country reports from a 2017 JWIT special issue on ASEAN with Prof Sakda Thanitcul as joint special editor and supported by the Sydney Southeast Asia Centre).

This new project’s primary purpose is to examine Asian approaches and case studies regarding corruption and serious illegality in international investment arbitration. It focuses on corruption-related disputes between private parties and public sector entities. It also covers other serious illegal conduct by foreign investors  related to or broadly equivalent to corruption and bribery, including serious non-compliance with key provisions of national laws regulating the admission or operation of foreign investment.

Regional free trade agreements such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the Regional Comprehensive Economic Partnership Agreement (RCEP Agreement) mandate member states to combat corruption and other illegal conduct. However, they remain silent on how specifically to deal with public-private disputes arising from corruption and illegality. Trade and investment law experts have become well aware of the problem, and some suggest treaty reforms even at a global level. Against this backdrop, the research aims to accumulate Asian perspectives, for Asia to build the foundation of leading the next rounds of treaty reforms. In particular, it intends to address the following questions:

  1. Whether Asia has been and will remain ‘ambivalent’ about international law prohibiting corruption and illegality. How have Asian countries been combatting corruption and other illegal activities particularly as to foreign investment? What laws and rules exist, and how do they operate in respective jurisdictions? What are the recent developments?
  2. Whether and how Asian countries have dealt with corruption and illegality in relation to foreign investment projects. If they have faced any international investment cases, what are the outcomes and consequences?
  3. Whether Asian countries have been or are more likely to become ‘rule makers’ rather than ‘rule takers’ in international investment law (as explored generally in the Brill and Wolter Kluwers books mentioned above) regarding corruption and illegality.

Those questions will support us to achieve the central objective: to examine Asian approaches toward  corruption and illegality in international investment arbitration. As we enter an age in which Brunei is increasing its engagement with foreign companies, it is probable that there will be disputes that need to be arbitrated, and corruption and illegality in investment arbitration are issues which other countries in the region are already facing. This research project will help the Bruneian authorities and the academic community, and counterparts in other Asia-Pacific jurisdictions as well as further afield especially when engaging with this region, learn more about such topical issues and potential counter-measures.

More specific expected outcomes include:

  1. One international online research workshop in mid 2022 and one international symposium in early 2023 (depending on pandemic travel restrictions), both in Brunei, for the contributors to present their papers and exchange opinions.
  2. An edited volume in the IAS-Springer Book Series on “Asia in Transition” based on the research papers by the contributors. (A further grant will be applied for to assist with related copy-editing etc, and CAPLUS interns and other Sydney Law School resources will assist particularly with the chapters authored by CAPLUS members.)
  3. A journal article co-authored by Professor Nottage, A/Professor Jetin and Dr Teramura for a Q1 Scopus journal.

Contributors based at UBD:

Name and FICsDescription of contribution
Dr Nobumichi TERAMURA (UBD-IAS)Principal Investigator – general editor and author of chapters for the edited volume in the IAS-UBD “Asia in Transition” series
Associate Professor Bruno Jetin (UBD-IAS)Co-Principal Investigator – general editor and author of chapters for the edited volume in the IAS-UBD “Asia in Transition” series
Yang Amat Mulia Pengiran Indera Negara Pengiran Anak Haji Puteh ibni Al-Marhum Pengiran Pemancha Pengiran Anak Haji Mohamed AlamGeneral contributor (re corruption, investment, arbitration and the Asia-Pacific) and author of the forewords of the edited volume
Professor Ahmed Masood Khalid (UBD-SBE)Contributor (re business and corruption)
Dr Masairol Bin Haji Masri (UBD-SBE)Contributor (re business and corruption)
Dr Hammeed Abayomi Al-Ameen (UBD-SBE)Contributor (re business law and corruption)

Other Contributors:

Professor Luke NottageUniversity of Sydney, Australia (CAPLUS Associate Director); UBD (visiting professor)Co-organiser – general editor and author of chapters for the edited volume in the IAS-UBD “Asia in Transition” series
Dr Colin Ong QCArbitration Association of Brunei Darussalam; and Colin Ong Legal ServiceContributor (re standard of proof for corruption allegations)
Professor Sakda ThanitculFaculty of Law, Chulalongkorn University, ThailandContributor (re Thailand)
Professor Sirilaksana KhomanFaculty of Economics, Chulalongkorn University; National Anti-Corruption Commission (NACC), ThailandContributor (re Thailand)
Mr Antony CrockettHerbert Smith Freehills, Hong KongContributor (re Indonesia)
Professor Simon ButtUniversity of Sydney (CAPLUS Co-Director)Contributor (re Indonesia)
Professor Romesh WeeramantryNational University of Singapore; Clifford ChanceContributor (re Lao Republic)
Justice Anselmo ReyesSingapore International Commercial CourtContributor (re corruption regulations for economic warfare)
Professor Vivienne BathUniversity of Sydney (former CAPLUS Director)Contributor (re China and Hong Kong)
Professor Joongi KimYonsei Law School, South KoreaContributor (re South Korea)
Professor Dai TamadaKyoto University, JapanContributor (re Japan)
Dr Prabhash RanjanSouth Asian University, IndiaContributor (re India)
Dr Martin JarrettMax Planck Institute, Heidelberg, GermanyContributor (re general investment law and investor misconduct)
Professor Tim LindseyUniversity of Melbourne, AustraliaContributor (re Indonesia)
Dr Jocelyn CruzDe La Salle University, the PhilippinesContributor (re the Philippines)

Publications and Webinars on Asia-Pacific arbitration and ISDS

On 23 March 2022 Kyoto University awarded Luke Nottage an LLD by publications for his book of selected/updated and some new essays on International Commercial and Investor-State Arbitration: Australia and Japan in Regional and Global Contexts (Elgar, 2021). In addition, a Transnational Dispute Management report of (Young-OGEMID listserv) Q&A about the book was published in February 2022.

On 2 March 2022 Prof Luke Nottage joined Dr Michael Hwang SC (Singapore), Neil Kaplan CBE QC SBS (Hong Kong), Hafez Virjee (Paris) for a public webinar entitled “Between Theory and Practice”, discussing the development of international arbitration particularly in the Asia-Pacific region and the place of Australian practitioners in this global market: watch the recording here. The webinar also discussed the benefits of pursuing international arbitration as an elective course, in the context of the large range of international arbitration materials made available to Sydney Law School students and staff through the Delos Dispute Resolution platform thanks to a subscription donated by Dr Hwang.

On 25 February Luke Nottage was interviewed for a podcast recording by a Bosnia-based association for arbitration, discussing the hot topic of transparency vs confidentiality particular in investor-state dispute resolution. Below is the outline of key points discussed.

In addition, Luke Nottage spoke on ISDS and investment treaties at the UoW Transnational Law and Policy Centre‘s co-hosted symposium on topics being negotiated in the Australia-India FTA (recording here), focusing on mandatory mediation before investors arbitrate disputes, and was then invited to speak on ISDS reform more generally for a symposium hosted by the Indian government’s Centre for Trade and Investment Law.

Some of Luke Nottage’s related recent publications include an overview chapter for a new book on the Asian Turn in Foreign Investment, an econometric analysis of ISDS-backed treaties on FDI flows, international arbitration and society at large (in the new Cambridge Compendium), professional diversity in international arbitration, and a review forthcoming in the Australian Law Journal of a new book on International and Australian Commercial Arbitration.

* * *

25 February 2022 webinar on Transparency in ISDS:

  • Pros and cons of transparency in international arbitration generally?
    • Fewer costs and delays in procedures and award-writing if procedure limited to the parties/counsel and arbitrators, not wider public
    • vs leads to more info asymetries in this market for services (arbitrators, especially lawyers, even expert witnesses) hence potential costs and delays: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2987674
    • If diminishing net cost savings, even in intl commercial arbitration, less attractive balance from rule of law perspective, undermining legitimacy of international arbitration compared to (more public) litigation – see (Menon CJ article, quoted in my JoIA article on ACICA Rules 2021 https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3931086: incidentally, those don’t relax confidentiality but do require disclosure of third-party funders)
    • Especially in investor-state arbitration, given its inherent greater public interests, and growing media attention (and polarisation)
  • Current regime:
    • Already considerable (surprising) transparency in ISA re awards (2/3): https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3227401 **
    • ICC Rules (mostly an ICA org, occasionally ISA): no confidentiality imposed on parties
    • ICSID Convention / Rules (2/3 of ISA cases): likewise, but eg „shall promptly“ publish „excerpts of legal reasoning“ in awards, need consent of parties for full award (or leak!)
    • Ad hoc arb UNCITRAL Rules (eg 2010): likewise, can publish awards if parties consent, arbitrator discretion re other transparency (eg Philip Morris v Australia procedural order)
      • Revised 2013 for transparency in all treaty-based arbs, then 2014 Mauritius Convention to extend transparency to pre-2014 treaties (whether UNCITRAL or other Rules)
  • The recent amendments of investment arbitration rules (most notably ICSID) and dispute resolution clauses in IIAs [eg] to allow third-party submissions.
    •  ICSID already in 2006 had amended its Rules for Convention and AF cases to somewhat expand confidentiality – https://icsid.worldbank.org/resources/rules-and-regulations/amendments/about
    • Recently decided further ICSID Rules revisions (since late 2016) align AF Rules (which also now can be adopted even without any party being member of the ICSID Convention) with expansive transparency across all stages as in UNCITRAL Rules; plus for ICSID (Convention states) Arb Rules eg at https://icsid.worldbank.org/resources/rules-amendments
      • [Proposed Rule 62] Automatic publication of award if 60 days pass and no objection lodged by a party (cf earlier debate that such „deemed consent“ too incompatible with Convention, which would need to be then amended but too many member states!)
      • [Rule 63] Publish excerpts of legal reasoning re decisions other than awards, eg on jurisdiction (eg recently under Australia-Egypt BIT: do treaties providing that a host state „shall“ consent to ISA provide advance consent to that procedure? Earlier see my https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2424987)
      • [Rule 64] publish other docs lodged (eg party submission) also if agreed by parties or tribunal discretion / weighing
      • [Rule 65] shall allow non-parties to attend hearings (and publish transcript or recording) unless a party objects
      • [Rule 66] but subject to redaction etc for „confidential information“ (listed types below)
      • [Rule 67] expanded provisions so tribunals MAY allow submissions etc by „non-disputing parties“ eg amicus curiae – text below bolded
      • [Rule 68] provisions so tribunals SHALL allow „non-disputing treaty parties“
  • Tension between the transparency concerns expressed by the States in the context of ISDS and the lack of actual application of the transparency rules in practice. 
    • Yet only 9 ratifications of Mauritius Convention, few of the big players (eg Canada 2016, Switzerland 2017, Australia 2020 alongside review of old BITs – but no public report!): lose control / treaty negotiating leverage? Prefer incorporating tailored regime in treaties, anyway need to do so (Rules options provided, and/or amendments) for post-2014 treaties as Mauritius Convention doesn’t apply to those
    • Some host states have been reticent about too much transparency, including in treaty (re)drafting or UNCITRAL reform deliberations: exposes their (even alleged) poor governance (hence many investors favour transparency, potentially even encouraging settlement: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2065636), impede settlement (only partly empirically justified? ** and see further Ubilava at https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3352181), more costs and delays (arguments over exceptions to transparency: Prof Zachary Douglas at https://www.claytonutz.com/ialecture/previous-lectures/2020)
  • Impact of legal tradition and culture on the approach to transparency in ISDS?
    • Less determined by say civil vs common law tradition, more eg socialist law / governance (eg Vietnam etc haven’t even ratified ICSID Convention, Chinese treatise were slow to incorporate much transparency) or developing country status (eg India?)
    • Culture might have some (small) impact: surveys etc show Eastern parties / counsel see confidentiality as advantage over litigation compared to Western, more generally think of eg https://en.wikipedia.org/wiki/The_Farewell_(2019_film) ?
  • Possible solutions to the improvement of transparency, while maintaining the benefits of confidentiality that the parties desire
    • States party should try to agree in treaties in advance
    • or during proceedings (but then host state and investor, and often acrimonious generally)
    • Otherwise, tribunals and counsel need to be aware of the competing interests, pros and cons of transparency (especially for costs and delays) as discussed above, when weighing whether and how to allow disclosures.

New ICSID (Convention) Arbitration Rule 66

Confidential or Protected Information

For the purposes of Rules 62-65, confidential or protected information is information

which is protected from public disclosure:

(a) by the instrument of consent to arbitration;

(b) by the applicable law or applicable rules;

(c) in the case of information of a State party to the dispute, by the law of that State;

(d) in accordance with the orders and decisions of the Tribunal;

(e) by agreement of the parties;

(f) because it constitutes confidential business information or protected personal

information;

(g) because public disclosure would impede law enforcement;

(h) because a State party to the dispute considers that public disclosure would be

contrary to its essential security interests;

(i) because public disclosure would aggravate the dispute between the parties; or

(j) because public disclosure would undermine the integrity of the arbitral process.

Rule 67

Submission of Non-Disputing Parties

(1) Any person or entity that is not a party to the dispute (“non-disputing party”) may

apply for permission to file a written submission in the proceeding. The application

shall be made in the procedural language(s) used in the proceeding.

(2) In determining whether to permit a non-disputing party submission, the Tribunal

shall consider all relevant circumstances, including:

(a) whether the submission would address a matter within the scope of the dispute;

(b) how the submission would assist the Tribunal to determine a factual or legal

issue related to the proceeding by bringing a perspective, particular knowledge

or insight that is different from that of the parties;

(c) whether the non-disputing party has a significant interest in the proceeding;

(d) the identity, activities, organization and ownership of the non-disputing party,

including any direct or indirect affiliation between the non-disputing party, a

party or a non-disputing Treaty Party; and

(e) whether any person or entity will provide the non-disputing party with financial

or other assistance to file the submission.

(3) The parties shall have the right to make observations on whether a non-disputing

party should be permitted to file a written submission in the proceeding and on any

conditions for filing such a submission.

(4) The Tribunal shall ensure that non-disputing party participation does not disrupt the

proceeding or unduly burden or unfairly prejudice either party. To this end, the

Tribunal may impose conditions on the non-disputing party, including with respect

to the format, length, scope or publication of the written submission and the time

limit to file the submission.

(5) The Tribunal shall issue a reasoned decision on whether to permit a non-disputing

party submission within 30 days after the last written submission on the application.

(6) The Tribunal shall provide the non-disputing party with relevant documents filed in

the proceeding, unless either party objects.

(7) If the Tribunal permits a non-disputing party to file a written submission, the parties

shall have the right to make observations on the submission.

** “… around 85% of cases where either the investor or the state have won are fully Public, and almost all the rest are only Partly Confidential. For settled cases, as italicised, 41% are Public or Partly Confidential.  This suggests that minimising costs and delays through early settlement may often be facilitated by keeping the outcome at least partly private, but not necessarily in all situations.”

Asia-Pacific Online Legal Education Before and After the COVID-19 Pandemic

[Update: video recording on Youtube – click here.]

This 1 February 2022 noon-1.30pm (AEDT) webinar at Sydney Law School discusses how online (university or other) legal education interacts with each jurisdiction’s legal profession, university system, and ICT infrastructure, as well as how online legal education has developed both before and after the COVID-19 pandemic, across several Asia-Pacific jurisdictions: Australia, Japan, Canada, Brunei/Malaysia/Singapore, Macau and Hong Kong. It draws on draft National Reports for an International Academy of Comparative Law conference hosted over 23-28 October 2022 in Asuncion (Paraguay), comparing over 20 jurisdictions worldwide, for a volume to be published by Intersentia co-edited by Professors Luke Nottage and Makoto Ibusuki.

Find out more about the project, including links to several draft reports.

Speakers:
Registration – gratis:

Please click here to register online.

Please click here to register in-person. (There are limited places available to attend this event in-person.)

This event is hosted by the Centre for Asian and Pacific Law at Sydney Law School, Australian Network for Japanese Law (ANJeL) and the Transnational Law and Policy Centre at the University of Wollongong.

Guest Blog: The Role of Independent Directors in Contemporary Asia

Written by: Joseph Black (CAPLUS law student intern, 2021)

On 26 October 2021 the Contemporary Asia International Forum Series coordinated a timely panel event entitled ‘The Role of Independent Directors in Contemporary Asia’. The panel was moderated by Dr Edith I Tzu Su, Associate Professor at the National Chung Hsing University in Taiwan, the host institution. The event was supported by the Centre for Asian and Pacific Law at the University of Sydney. Panelists were Dr Indraijt Dube, Professor of Intellectual Property Law at the Indian Institute of Technology Kharagpur; Dr Anil Hargovan, Associate Professor at the University of New South Wales; Dr Luke Nottage, Professor of Comparative and Transnational Business Law at the University of Sydney; and Dr Chun-Ren Chen, Professor at the National Cheng Kung University in Taiwan. We had the opportunity to explore key and original themes: the roles of independent directors in India; the roles of independent directors in Southeast Asia; and more. A few major questions reverberated throughout the session: are independent directors (although not executives or employees) de facto part of a wider managerial team; what are the implications of transplanting non-Asian laws and norms into Asian contexts (with a stronger blockholder tradition even in listed companies) and how are Asian companies distinguished from non-Asian companies? What made the webinar particularly interesting is that speakers had diverse insights and answers to these very topical and pressing questions.

After Dr Su commenced the session and introduced speakers, and Dean Chang Yen Li of the National Chung Hsing University delivered a cordial welcome, Dr Nottage commenced the discussion on corporate governance and independent directors, sketching the growth of sharemarkets in ASEAN and other parts of Asia, focusing on Malaysia and more briefly Cambodia. He proposed comparisons focusing on why and when independent director requirements are introduced, how this happens, what they are, and where they actually or potentially have impacts. Dr Nottage noted that Malaysia presents interesting data on independent directors given its peculiar history. Amid and after the Asian financial crisis in 1997, the World Bank and IMF encouraged (without requiring) changes and new corporate governance regulations in Malaysia. Notably, Malaysia was an early leader calling for independent directors (implementing requirements before Australia), but commentators have wondered wonders if this was ‘window dressing’ to lure back foreign investors (and regain foreign investors who had fled after the financial crisis). While they may have tried to introduce independent director requirements, it is critical to consider that there are always problems with legal transplants. Malaysia developed (like Thailand[1]) a three-tiered system of mandatory listing rules, ‘comply or explain’ Corporate Governance Code higher standards, and even higher independent director requirements that listed companies can voluntary disclose (but for which they do not need to explain non-compliance). A particular innovation – somewhat paralleling Indian corporate law reforms in 2013 – is is to require a two-tier vote (including a majority of the minority) for directors serving more than 12 years.

By contrast, Cambodia has a much newer and smaller sharemarket, with a less well-resourced regulator, so relies just on mandatory minimum standards. Those exclude from independent directors any individuals serving in competing firms, as in Thailand, perhaps reflecting the weakness of competition law and enforcement.[2] It will be interesting to observe how the country changes and independent director requirements start to be tightened in an effort to make them more functional. Following Dr Nottage, Dr Dube’s discussion largely focused on the role of independent directors in contemporary India. Dr Dube posed interesting questions – such as whether Indian corporate governance needs to be ‘Indianised’ – and explored the emergence of diverse laws in tandem with growing conceptualisations of independent directors in the Indian context. Dr Dube seemed to use a very interesting word – calibrating – to define continuity and change in this area in India in recent years. Dr Dube discussed the mandatory appointment of women independent directors; declaration of independence; auditing independence; the theory that independent directors played significant roles in raising market size, profitability, and sustainability; and evidence-based research finding a positive correlation between influences of independent directors and companies’ policies on health, safety, and environmental audits. Dr Dube noted the Tata Group Supreme Court case in 2016 (regarding the removal of then chairman Cyrus Mistry from office and later the company’s board) and implications (i.e., normalising independent directors in this context?).

Later, Dr Hargovan and Dr Chen posed as commenters and critically appraised Dr Nottage and Dr Dube. Dr Chen particularly analysed the concept of novel law on independent directors as window dressing to attract foreign investment, whether independent directors are supposed to serve as managers or a check against managers, tensions in boardrooms, incumbent directors refusing independent directors access to certain corporate data in Taiwan, seemingly inevitable conflicts between majority and minority shareholders, and implications of declaring independence (i.e., is it just a declaration?). Dr Hargovan referred to minority interests in family-dominated companies in Asia, independence from whom and for what (definitional issues), the perils of the legal transplant, optimal board composition (taking into account local conditions and cultures), characteristics of Asian companies (tangential to varieties of capitalism), the Kotak Committee Report in India (2017), and indicia of independence (interestingly similar between say Australia and India). Dr Hargovan noted that listed companies in Asia are more likely to be controlled by promoters than in Australia, where ownership is typically more diffused and the participation of institutional investors in corporate ownership follows a different pattern. Dr Hargovan closed by noting that the Anglo-Australian model is not guaranteed to be successfully transplanted to Asian countries; a lot depends on the economy and other factors, as illustrated by his recent article on Indian developments.[3]

Dr Nottage and Dr Dube closed with a few short words in response, although time was limited. To view the recording and for further Contemporary Asia International Forum Series events, please contact Dr Edith I Tzu Su at edithsu@nchu.edu.tw.

***

Joseph Black is a Juris Doctor student at the University of Sydney and anticipates commencing his Masters of International Law program from February 2022. Joseph is an intern with the CAPLUS and is interested in Japanese Law, Chinese Law, Indonesian Law, East Asian Studies, and other fields.


[1] Nottage, Luke R., Independent Directors and Corporate Governance in Thailand: A New Frontier (May 13, 2020). Journal of Transnational Law and Policy, 31 (Forthcoming, early 2022), Sydney Law School Research Paper No. 20/26, Available at SSRN: https://ssrn.com/abstract=3599705

[2] Nottage, Luke R., Fledgling Corporate Governance and Independent Directors in Cambodia’s Securities Market (November 14, 2019). Australian Journal of Corporate Law, 35, 2020, pp. 208-234, Sydney Law School Research Paper No. 19/60, Available at SSRN: https://ssrn.com/abstract=3459361

[3] Hanrahan P; Hargovan A, 2020, ‘Legislating the concept of the independent company director: Recent Indian reforms seen through Australian eyes’, Oxford University Commonwealth Law Journal, vol. 20, pp. 86 – 114, http://dx.doi.org/10.1080/14729342.2020.1773018

Japanese and Asia-Pacific Dispute Resolution events over October 2021

Over this month I am pleased to contribute to three events regarding Asia-Pacific arbitration and dispute resolution. On 1 October, I am moderating a session on International Commercial Arbitration in Japan and Germany, at the comparative ADR conference hosted by Institute of Japanese Law at the FernUniversität in Hagen to commemorate the 30th anniversary of its online courses in Japanese law. The speakers are well-known lawyers Ms Yoshimi Ohara (Nagashima Ohno & Tsumematsu) and Dr Christian Strasser (HEUKING KÜHN LÜER WOJTEK). Other sessions compare investment treaty arbitration as well as mediation.

On 20 October I present two classes in a new postgraduate law course on international commercial arbitration developed for the University of Chile by Santiago-based lawyer and former USydney LLM student Ricardo Vasquez Urra, which we hope will be offered annually. This too draws on my recently published book on international commercial and investor-state arbitration, and parallels my co-teaching (with barrister Dr Anna Kirk) the LLM course on international commercial arbitration at the University of Auckland late last year and in 2022.

On 2 October, I present the module on consumer redress and access to justice for a new postgraduate intensive course on consumer protection developed by the University of Malaya. I highlight law and policy developments mostly by comparing Australia, Japan and Southeast Asia, building on books including ASEAN Consumer Law Cooperation and Harmonisation (CUP 2019) and Contract Law in Japan (Wolters Kluwer 2019, 2nd ed 2022), as well as other recent publications including Studies in the Contract Laws of Asia (especially Volume III, all reviewed here for the Journal of Japanese Law). We explore some law and practice around courts and tribunals, Ombudsman and related arbitration-like processes, mediation, and other processes for consumer redress.

P.S. On 26 October I also present on “Corporate Governance and Independent Directors in Southeast Asia” (focusing on Thailand and somewhat Malaysia) for a webinar on the Role of Independent Directors in Contemporary Asia, part of the Contemporary Asia International Forum Series 2021 at National (National Chung Hsing University) hosted by Professor I-Tzu (Edith) Su.

P.P.S. This marks the 250th posting on this Japanese Law and the Asia-Pacific blog, over more than a decade. Many thanks to occasional guest bloggers and all readers!

Studies in the Contract Laws of Asia (Volumes I-III of VI)

My review essay [longer manuscript here on SSRN, shorter version forthcoming in Journal of Japanese Law (end-2021)] assesses the detailed, authoritative and thought-provoking first three of six proposed volumes in the series on “Studies in the Contract Laws of Asia” published by Oxford University Press. Lead-edited by Mindy Chen-Wishart, these excellent volumes span remedies for breach (2016), formation of contract and third-party beneficiaries (2018), and contents of contracts and unfair terms (2020, thus extending to an important area of consumer law). The respective editors argue quite compellingly for significant functional convergence even among Asian legal systems from quite divergent legal traditions. However, such convergence arguably becomes less obvious especially by the third volume. The functional analysis also focuses primarily on what decisions would be rendered by courts in stylised fact scenarios rather than whether and how such outcomes are reflected in contracting practices or law reform processes. Closer examination of these aspects may make future volumes even more valuable for researchers, practitioners and policy-makers.

Asia ADR Week 2021 session on roles of in-house counsel [& ‘errors of law in arbitration’]

[Updates: A. Also in August 2021, I chaired a presentation via Monash University on “Errors of Law in Arbitration – Revisited”, with a recording here. Dr Benjamin Hayward argued that a tribunal’s application of a substantive law different from that expressly chosen by the parties, or not applying the conflict of law provisions of the seat (and any chosen Rules) where such substantive law is not expressly chosen, could constitute an error of applicable procedure and thus a ground for challenging the consequent arbitral award.

B. My co-authored article on the new ACICA Rules (mentioned at 7 below), including comparative references to Japan and other Asian jurisdictions, is available in manuscript form: Nottage, Luke R. and Dreosti, Julia and Tang, Robert, The ACICA Arbitration Rules 2021: Advancing Australia’s Pro-Arbitration Culture (September 26, 2021). Journal of International Arbitration, 38:6, 2021 (Forthcoming), Available at SSRN: https://ssrn.com/abstract=3931086

C. My co-authored article empirically examining the “formalisation” of international arbitration, and the diminishing influence of non-lawyers (or even in-house counsel) across key nodes of influence, is available in manuscript here (and shortened for a forthcoming Elgar book co-edited by Shahla Ali, Giorgio Colombo et al on “Sustainable Diversity in International Arbitration”): Nottage, Luke R. and Teramura, Nobumichi and Tanna, James, Lawyers and Non-Lawyers in International Arbitration: Discovering Diminishing Diversity (September 20, 2021). Available at SSRN: https://ssrn.com/abstract=3926914]

As part of the “Asia ADR Week” of events for 2021, coordinated by the Asian International Arbitration Centre based in Kuala Lumpur, as session was scheduled for the first day of the main conference – Thursday 19 August 4-5pm AEST (2-3pm KL time) – on the topic of “Starting In-House: The Role of General Counsel of Multinational Corporations in ADR”. [A recording is available on request for my USydney students.] Agreed session contributors were myself as moderator and:

  1. Ms Debolina Partap (Wockhardt Limited, general counsel based in Mumbai)
  1. Ms Esther Chow (Kone Elavator (M) Sdn Bhd, general counsel based in KL)
  1. Mr Nick Longley (Holman Fenwick Willan, based in Melbourne; formerly in a law office in Hong Kong as well as in-house for four years with a Japanese civil engineering company and now significant engagement with Korean firms)
  1. Mr Cameron Ford (Squire Patton Boggs, based in Singapore, and formerly in-house for over a decade)
  2. Mr Raymond Goh (China Tourism Group Corp Ltd, Group general counsel – International, in Hong Kong / China).

The assigned description was: “The role of an in-house counsel in shifting the focal point on dispute resolution from the traditional standpoint of litigation to the innovative vigor of ADR has resulted in the majority of Fortune 1000 companies preferring to use ADR as a means of resolving both international and domestic disputes. This session focuses on the multi-faceted role of in-house counsel in spearheading ADR as a principal means of resolving disputes.” The focus therefore was on evolving in-house counsel perceptions around Asia regarding alternatives to litigation (arbitration, mediation, other Alternative Dispute Resolution) to resolve cross-border disputes. Part of the backdrop is resurgent delays and especially costs in international commercial arbitration despite its continued spread east from the traditional (European then US) venues.

The first part of the session asked some general questions focused on our panelists currently or having worked extensively as in-house counsel [Ms Chow, Ms Partap, Mr Goh, Mr Ford]:

1. How do or should in-house counsel teams nowadays decide generally whether to provide for and/or engage in arbitration, mediation, expert determination or other ADR rather than cross-border litigation?

2. Does or should the approach change if the disputes involve commercial and government parties?

The second part of the session posed some more specific questions:

3. The latest QMUL international arbitration survey (with more than usual Asia-Pacific respondents) confirms the continued popularity of multi-tiered DR clauses, which commit parties contractually to try eg mediation before arbitration (rather than having waiting for the dispute to arise, and then try to achieve agreement to try other ADR before proceeding to pre-agreed arbitration). Yet are such multi-tiered clauses equally negotiated and invoked among companies and legal advisors in the Asian region? See http://www.arbitration.qmul.ac.uk/research/2021-international-arbitration-survey/ [cf eg Japan, Korea (Mr Longley), Malaysia (Ms Chow)]

4. Especially in the region, are there difficulties in enforcing say the mediation step (as a jurisdictional requirement say before being able to proceed to arbitration), and issues in determining the law applicable to that question? Cf eg this US report / chapter for a book / project by Profs Gu and Reyes: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3601337, and recent case law in Hong Kong etc (https://pulse.kwm.com/hong-kong/multi-tiered-dispute-resolution-clauses-what-happens-if-you-dont-comply/) [Mr Longley]

5. What prospects are there for more establishment and use of dedicated centres for mediation, especially in the Asian region (eg already Singapore / SIMC, but also recently Japan / JIMC and Vietnam / VMC)? See eg https://www.jimc-kyoto.jp/. Would it be easier for in-house counsel to promote cross-border mediation if institutional, rather than ad hoc?

6. Why is the 2019 Singapore Mediation Convention, aimed at facilitating enforcement of settlement agreements along the lines of the NYC, attracting many signatures (but not eg from Japan or Australia) but few ratifications? See https://uncitral.un.org/en/texts/mediation/conventions/international_settlement_agreements/status. What have been experiences in enforcing settlement agreements cross-border in Asia even without this new Convention?

7. Is there declining interest and practice of Arb-Med across Asia (except perhaps in mainland China and to a lesser extent Japan), linked perhaps to more use of separate mediation as part of multi-tiered DR clauses, and/or a sense that Arb-Med is not “global practice” which arbitration institutions and practitioners feel increasingly required to follow? Cf ACICA (for which Mr Longley and I served on the Rules drafting committee) which decided not to proceed with an Arb-Med provision in its 2021 Rules, although modelled on legislative provisions for domestic arbitrations: http://arbitrationblog.kluwerarbitration.com/2021/05/01/is-arb-med-un-australian/ [Mr. Goh]

8. Are there already or likely to be changes towards more use of mediation (either separate, or in Arb-Med) due to the pandemic, or eg has the enforced move to remote hearings etc created enough time, cost and arbitrator availability benefits to maintain adequate attractiveness for international arbitration? Is the recent rise of Expert Determination in Australian domestic dispute resolution driven by arbitration costs and delays in arbitration and litigation, thus likely to carry over into cross-border dispute resolution and beyond the pandemic? [Mr Longley, compared with say Malaysia – Ms Chow, and experiences from Singapore – Mr Ford]

Guest Blog: COVID-19 in Asia – China, Japan, Indonesia and Malaysia in Focus

Written by: Hao Yang Joshua Mok, student intern at the Centre for Asian and Pacific Law at the University of Sydney (CAPLUS)

On 28 May 2021, the University of Victoria’s Centre for Asia-Pacific Initiatives (CAPI), together with the University of Sydney’s Centre for Asian and Pacific Law (CAPLUS) and the Australian Network for Japanese Law (ANJeL), hosted an online webinar celebrating the publication of Covid-19 in Asia – Law and Policy Context’. A recording of the webinar may be accessed here.

Edited by Prof. Victor V. Ramraj and published by Oxford University Press, the book is a collected volume on Covid-19 law and policy issues in Asia. It draws upon the work of sixty-one authors from seventeen jurisdictions and aims to capture the initial responses of governments in response to the pandemic and highlight likely enduring legal and policy challenges.

The online webinar drew on four chapters of the book, focusing on China, Indonesia, Malaysia, and Japan’s responses to the pandemic.

  • The China chapter was presented by A/Prof. Feng Xu from the University of Victoria and discussed by A/Prof. Jeanne Huang from the University of Sydney.
  • The Indonesia chapter was presented by Dr. Nadirsyah Hosen from Monash University and discussed by Prof. Simon Butt from the University of Sydney.
  • The Malaysia chapter was presented by Dr. Azmil Tayeb from Universiti Sains Malaysia.
  • The Japan chapter was presented by Prof. Shigenori Matsui from the University of British Columbia. Prof. Luke Nottage from the University of Sydney briefly discussed both the Malaysia and Japan chapters.

A/Prof. Xu began her presentation with a reflection of China’s largely successful Covid-19 response. She suggested that we must contextualize China’s experience as an interrelationship between coercion and consent: China’s success in imposing and enforcing strict lockdown and quarantine measures required the acceptance and consent of individuals to those conditions. Turning to the book chapter itself, A/Prof. Xu suggested that China’s emergency response involved the mass mobilization of political, economic, and social resources. While effective, such measures came at a huge cost to individual rights. A/Prof. Xu concluded that the most immediate challenge for China will be the roll-out of its vaccination program.

A/Prof. Huang echoed this theme of consent and emphasized the limited scope of the right to privacy and personal information in China. While this allowed health administrators to access personal data when managing the pandemic, it reflects the tension between coercion and consent. Drawing on her area of focus, A/Prof. Huang provided some brief remarks on civil litigation against China arising out of the pandemic – raising issues of jurisdiction and service – as well as on China’s response to foreign criticism, exemplified by its trade dispute with Australia.

Dr. Hosen suggested that the Jokowi administration’s response to the Covid-19 pandemic had been too little, too late. Despite growing cases in South East Asia in early January, the government did not impose lockdown measures but rather further opened up the country. While the government eventually escalated its measures, the pandemic was already in full swing. Dr. Hosen argued that there were four barriers that contributed to the slow response and ineffectiveness of governmental measures: first, the unhealthy relationship between the Indonesian Medical Association and the Minister of Health Affairs; second, the political rivalry between President Jokowi’s administration and the current governor of Jakarta; third, the incompetence of the Jokowi cabinet; finally, the position of conservative religious groups in rejecting the request not to organize mass prayers.

In Prof. Butt’s discussion, he suggested that issues of governance, politicking, and religion are not new issues for Indonesia. Rather, they have been brought to sharp relief by the pandemic. Moreover, putting aside the government’s shortcomings, the size and geography of Indonesia presents significant difficulty. Prof. Butt concluded that looking forward, the biggest difficulty for Indonesia would be to obtain and administer vaccines in the face of those persistent issues.

Dr. Tayeb discussed issue of improvised pandemic policy and democratic regression in Malaysia. In the lead up to the Covid-19 pandemic, Malaysia was experiencing a volatile political environment which eventually resulted in a new coalition coming into power in late February 2020. Shortly thereafter, Covid-19 emerged, and the government responded by implementing strict lockdown measures. While those measures were initially successful, the country experienced a turning point. Under the backdrop of a continued power struggle, state by-elections were occurring without much restriction. This led to another wave of Covid-19 cases. Dr. Tayeb suggested that throughout the pandemic, the government’s response evinced incoherency. Moreover, the government has been using the pandemic to avoid the convening of parliament, undermining notions of accountability and transparency.

Prof. Matsui suggested that Japan was ill-prepared to deal with the pandemic and its eventual response was slow and insufficient. The difficulty was with Japan’s fragmented and restrictive infectious disease legal infrastructure. While the government eventually revised its statute and declared a state of emergency, only soft measures were imposed, because of initial legal constraints and the effectiveness of social norms. Fortunately, infection rates and death toll remained low in Japan throughout 2020. Now, however, Japan has experienced a resurgence in Covid-19 cases and there is a growing fear that this will worsen with the Tokyo Olympics. The biggest issue ahead for Japan is with its vaccination program, especially given concerns about vaccine hesitancy among the public.

Prof. Nottage went on to compare Malaysia and Japan’s responses during the Covid-19 pandemic. He suggested that in terms of balancing public health, civil liberties, and economic activity, Japan appeared to be quite successful. Prof. Nottage queried the reasons behind vaccine hesitancy this year, especially given the communitarian norms evident last year, as vaccination programs constitute the next complex phase in pandemic management in Australia, across Asia and world-wide.

Online Legal Education Compared: Australia, Japan and (Far) Beyond

[Updates: CAPLUS with others hosted on 1 February 2022 a related webinar focusing on “Asia-Pacific Online Legal Education Before and After the COVID-19 Pandemic”, with a video recording later uploaded on Youtube – click here.] In addition, some research assistance for this book project has been funded through the University of Wollongong’s new Transnational Law and Policy Centre, which is also supporting the webinar.]

Together with past ANJeL Visitor and Program Convenor (ANJeL-in-Japan), Seijo University Professor Makoto Ibusuki, I have been appointed General Reporter by the venerable International Academy of Comparative Law for a project comparing “Online Legal Education” across around 20 jurisdictions world-wide, including Australia and Japan. Draft National Reports will be received by January 2022 so we can draft our General Report, summarising key findings, to be presented at the four-yearly IACL Congress – this time hosted over 23-28 October 2022 in Asuncion (Paraguay). We plan then to co-edit a book in the IACL’s book series previously published by Springer and henceforth by Intersentia.

We hope to get and share insights into how online (university or other) legal education interacts with each jurisdiction’s legal profession, university system, and ICT infrastructure, as well as how online legal education has developed both before and after the COVID-19 pandemic. Below is the draft “questionnaire” we provided to guide (but not dictate to) Reporters preparing their chapters, and the current list of jurisdictions and Reporters nominated by IACL national committees. We welcome feedback on other questions or angles on this practically important and theoretically interesting topic for comparative research.

  • A. Background: Legal Profession, University and IT Systems Generally
    • Who are the main “gatekeepers” to the legal profession (cf Anderson & Ryan, 2009)? Does its corresponding size and nature make it generally harder or easier to move (university/qualifying or continuing) legal education online?
      • The existing legal profession (eg like Japan: bengoshi lawyers, negotiating with the Ministry of Justice and courts): tends to result in smaller legal profession, but still many other LLB graduates (not qualified as lawyers)
      • Universities (eg like Australia previously or now NZ: LLB and JD graduates can almost all qualify as lawyers, as they they need to just complete a short easy practical training course, so the numbers of law students allowed into universities – by the government as in NZ, or by universities themselves since 2011 in Australia – determines the size of the legal profession): tends to result in a larger legal profession
      • The market (eg like USA: as there are so many accredited law schools, and state bar exams are easily passed at least after a few attempts, so the numbers of lawyers is really determined only by whether students think they will be able to get a job as lawyer after graduating): tends to result in the largest legal profession
    • How are universities (and law schools) generally funded? Does this make it harder or easier to move legal education online?
      • Eg universities in Australia: growing dependence on international student revenues, including more recently in law – many are non-native English speakers (eg from China), so may be more difficult to move effectively their legal education online
      • Cf universities in Japan: still much lower international student proportions, especially in law; correspondingly more emphasis on research, so maybe easier to move online
    • How widespread is access to good-quality and affordable IT hardware (computers etc) and software (including internet access), among university students/teachers and legal professionals?
      • Eg in Australia: quite good for both groups, making it again easier to move university/qualifying & continuing legal education online
      • Cf in Japan: quite good for lawyers but less so for judges/courts, variable for university teachers, quite bad for many university students
  • B. Moves Towards Online Education:
    • Summary achievements before the pandemic, in light of the above background
      • University and/or qualifying legal education
      • Continuing (post-admission) legal education
    • Achievements and challenges after the pandemic
      • Briefly re continuing legal education
      • Details for university and/or qualifying legal education
        • Course/program goals (any revisions needed?)
        • Course assessment methods (fewer exams, more assignments and/or essays? Changes to grading curves?)
        • Delivery methods (purely online eg live and/or pre-recorded, hybrid with some face-to-face teaching?)
        • Other administrative challenges (eg more plagiarism?)
        • Student welfare and extra-curricular activities?
  • C. Conclusions:
    • Overall, has the shift to more online education been positive?
    • With (big!) assumptions of similar structure for legal profession, university funding and IT systems, what are the prospects for further online legal education as the pandemic abates?
1. Australie/Australia [on SSRN]William van Caenegem (Bond  University) & Trish Mundy (University of Wollongong)
2. Belgique/Belgium Jan-Baptist Lemaire (KU Leuven)
3. Brunei & Malaysia / Singapore [on SSRN]


4. Canada  [on SSRN]
Nobumichi Teramura (Universiti Brunei Darussalam, Institute of Asian Studies) & Salim Farrar (University of Sydney, Law School)

Adrien Habermacher (UMoncton)
5. Chypre/Cyprus Demetra Loizou and Lida Pitsillidou (University of Central Lancashire, Cyprus) 
6. Croatie/CroatiaMirela Župan (University  of JJ Strossmayer in Osijek Faculty  of Law)
7. Danemark/ Denmark Per Andersen (Aarhus University)
8. Estonie/Estonia Age Värv (University of Tartu,  Faculty of Law) 
9. Etats-Unis/USAMichael Hunter Schwartz  (University of the Pacific,  McGeorge School of Law)
10. Hongrie/HungaryIstván Hoffman and András Szabó (Eötvös Loránd Université)
11. Italie/Italy Rossella Esther Cerchia  (University of Milano Statale) 
12. Japon/Japan Kenichi YONEDA (Kagoshima  University)
13. Macao/MacauRostam J. NEUWIRTH, Alexandr SVETLICINII, Muruga Perumal RAMASWAMY (University of  Macau) 
14. Norvège/Norway Tobias Mahler (University of Oslo)
15. Pakistan Syed Imad-ud-Din Asad 
16. Pays-Bas/ Netherlands Ernst van Bemmelen van Gent (UDO, Utrecht University)
17. Roumanie/ RomaniaDaniela-Anca DETESEANU  (Universitatea din Bucuresti)
18. Royaume-Uni/UK 

19. Seychelles [on SSRN]

20. South Africa
Andra le Roux-Kemp  (University of Lincoln)

Nyasha Noreen Katsenga (University of Seychelles)

Edwin Coleman (University of Johannesburg, CICLASS)
21. Tchéquie/Czech  RepublicDavid Sehnálek (Masaryk University)
22. Turquie/Turkey Elif Küzeci  (Bahçeşehir University) 
23. VenezuelaEugenio HERNANDEZ-BRETON  (Universidad Central de  Venezuela, Universidad  Monteavila, Academia de  Ciencias Politicas y Sociales)
24. Hong Kong [on SSRN]Alice Lee and Wilson Lui (University of Hong Kong)