Transparency in Treaty-based Investor-State Arbitrations – Australia signs the Mauritius Convention

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​This article was written by Alex Baykitch AM, Daisy Mallett and Brecht Valcke. 

On 18 July 2017, Australia signed the United Nations Convention on Transparency in Treaty-based Investor-State Arbitration (New York, 2014), commonly known as the Mauritius Convention on Transparency (the Convention), which will enter into force on 18 October 2017. In doing so, Australia became the 21st State to sign the Convention. The Joint Standing Committee on Treaties will now consider Australia's ratification. 3 States (Canada, Mauritius and Switzerland) have already ratified the Convention.

Why is the Convention of importance to international arbitration?

In 2014, the United Nations Commission on International Trade Law (UNCITRAL) Transparency Rules (Transparency Rules) entered into force. The Transparency Rules increase transparency in investor-state arbitration proceedings that are conducted under the UNCITRAL Arbitration Rules. The Transparency Rules include provisions for:

  • publication of documents;
  • open hearings; and
  • the opportunity for interested third parties to file and make submissions

The Transparency Rules represent a departure from the traditional approach to the conduct of investor-state arbitration under the UNCITRAL Arbitration Rules which retain concepts of privacy and confidentiality.

A significant limitation with the Transparency Rules is that they only apply automatically to disputes arising out of treaties concluded after 1 April 2014. For arbitrations commenced before 1 April 2014 the Transparency Rules will only apply if:

  • the parties to the relevant treaty that is the basis of the dispute; or
  • the parties to the arbitration,

agree to their application.

Given the prospect of in excess of 3000 bi-lateral investment treaties only being caught by the Transparency Rules on the basis of mutual agreement, UNCITRAL was aware of the need to harmonise the scope of application of the Transparency Rules to all investment treaties regardless of the date they were concluded. The Convention aims to extend the scope of application of the Transparency Rules to all treaty based investor-state arbitrations regardless of when the relevant treaty the subject of the dispute was concluded or the applicable arbitration rules chosen. In essence, the Convention establishes transparency as the default position in international investment law.


Investor-state arbitration has and continues to be the subject of scrutiny by governments and civil society around the world. The involvement of a State as a party to an arbitration under an investment treaty is a matter of public importance. Typically, investor-state arbitration poses significant potential liability to a State's finances and its citizens have an interest in understanding the nature of the dispute, which often involves allegations by the foreign investor of misconduct on the part of the State or one of its officials. Further an increasing number of investor-state disputes involve complaints by foreign investors about regulatory decisions by governments, which raise matters of important public policy and the State's rights to regulate to protect matters such as health and the environment (for example, numerous cases have been initiated in relation to tobacco controls and environmental controls over mining and resources developments).

The widespread adoption of the Convention should ensure that States and their citizens will have greater insights into and understanding of the investor-state arbitral process and the reasons why their government may be involved in one of these disputes. More importantly the Convention, by extending the application of the Transparency Rules to investor-state arbitrations, will provide citizens of States involved in such a dispute with an opportunity of being directly involved in the arbitration by making submissions as an affected or interested third party.

King & Wood Mallesons' involvement in negotiating the Convention

International arbitration partners Alex Baykitch AM and Daisy Mallett participated in the negotiations of the Convention and the Transparency Rules as part of the Australian government delegation.

If you would like to discuss whether these developments will have an impact on your foreign investment, please contact us.

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