THE RECOGNITION AND ENFORCEMENT REGIME FOR ICSID AWARDS IN THE UNITED STATES, CHINA AND NIGERIA: AN ANALYTIC COMPARISON
Global economic problems and developmental challenges require enormous capital resources to solve! The truth of this assertion is present with us irrespective of country, region or continent and there is a dire need for movement of capital across national boundaries. However, in the world of economic relations, disputes are bound to occur, either between states or between investors and states. This article examines how an arbitral award, particularly that of the International Centre of Settlement of Investment Dispute (ICSID) can be enforced and recognized in the three leading global and continental markets - United States, China and Nigeria. The article examines the economic potentials and FDI relationships between the trio states. It evaluates the treaty and domestic statutory framework of these countries. It looks at the ICSID Convention undertaking of these states and the domestic law regime for the recognition and enforcement of ICSID Awards. It concludes by stating that while the United States may presently be the best forum for the enforcement of an ICSID award given its robust and tested domestic legal framework, nothing prevents Nigeria from providing such an avenue for an investor or ISCID award creditor and that China can build on a tremendous success in its economic reform by matching it reforms with a clear domestic mechanism for the enforcement and execution of not just an ICSID award but also for other international obligations.
Since the inception of modern investment relationship between nations, the current investment environment is by far the most complex. Globalization has made it impossible for any nation, no matter how industrialized to be self-sufficient. With huge capital flowing in all directions - some developing economies (emerging markets) have increasingly become recipients and in some cases providers of Foreign Direct Investment (FDI), while the industrialized economies remain the dominant providers of FDI.
The impact of FDI on global economic activities has been on the increase. FDI inflows have expanded from US$40 billion at the beginning of the 1980s to US$ 200 billion in 1990 and to some US$1.8 trillion in 2008. The United States, China and Nigeria have immensely benefited from this global movement of capital, particularly as a result of the leading role they play in the global economy. With the United States and China respectively ranking as the largest and the second largest economy and Nigeria ranking as the largest economy in Africa, the economic influence of all three countries from a global and regional economic perspective cannot be overemphasized.
However, in this world of international economic relations, disputes are bound to arise, which requires settlement mechanism to ensure their effective resolution. Such dispute settlement mechanisms will ordinarily entail the assumption of obligations by both parties, or by one party to protect the interest of the other. This assumption of obligations should translate into positive actions of compliance with the measures inherent in the dispute resolution mechanism.
Over the decade, the world has witnessed an evolution and legalization in the various means and approaches adopted by states in relation to providing a forum for resolution of disputes arising from international economic relations. The importance that the international community attaches to this area of international economic relations has led to the promulgation of the International Convention for Settlement of Investment Disputes ("Washington Convention" or "the ICSID Convention") under the aegis of the World Bank Group, to cover the settlement of investment disputes between investors and host states. The ICSID Convention, in turn, established the International Centre for Settlement of Investment Dispute ("the Centre") which implements the provisions of the ICSID Convention.
The focus of this paper is however not on the ICSID arbitration process per se; it is on the recognition and enforcement of ICSID arbitral award not just within the contest of its constituent document the Washington Convention, but also from the perspective of the domestic law regime of the three states (United States, China and Nigeria). The unique nature of the ICSID makes an ICSID award not to be subject to any judicial challenge, rather one that is intended to have automatic recognition and enforcement by the national court of a contracting state.
The ICSID as an international institution sitting in Washington, DC is part of the World Bank Group and it was established in 1966. It is important to note that the main purpose of the ICSID is to provide the forum and facilities for conciliation and arbitration of investment disputes between contracting states and nationals of other contracting states, in accordance with the provision of the Convention. The idea of ICSID as conceptualized by the then General Counsel to the World Bank, Aron Broches, was focused on procedural norms for investment protection rather than substantive norms. His idea was establish a politically neutral multilateral forum where investment disputes could be resolved between investor and host state. The ICSID was structured to be independent of the courts of either parties and should offer internationally unified procedure for resolution to foster predictability.
As at December 31, 2013, ICSID has 158 signatory states, and 150 contracting states (including the United States, China and Nigeria) had ratified the Washington Convention. With the ever increasing bilateral economic relationship between the United States and Nigeria, between United States and China and between China and Nigeria; and even the strategic economic and investment role all three countries play for investors from other contracting states of the Washington Convention, it has become imperative that an analysis of the recognition and enforcement regime of an arbitral award rendered under the auspice of ICSID in these three countries be carried out. The need for this analysis is further heightened by the fact that despite its shortcomings and criticisms, ICSID has become the most well-known and commonly invoked institutional avenue for settlement of disputes arising from investment owned by the national of a contracting state in another contracting state. Given that the United States, China and Nigeria are all contracting states to the ICSID Convention, it will not be out of place for one to assume that most investment disputes involving a national of any of these countries will be resolved under the auspices of ICSID.
This paper examines by way of a comparative analysis the regime for the enforcement and recognition of an ICSID award in the United States, China and Nigeria. This it does by not just focusing on the strict legal regime, but by first discussing the economic potentials of the three states and what they portend for investors trying to invest in any of the countries. Part 1 introduces the hypotheses. Part 2 gives an overview of the economic potentials and the existing FDI relationship between the trio states. This is done primarily with the intention of laying out the economic and investment prospects at stake. Part 3 focuses on the main thrust of the paper. It examines the ICSID Convention and its provisions for the enforcement and recognition of arbitral awards. Further, the domestic law regime, through which the respective states fulfil their ICSID obligation as it relates to recognition and enforcement, is examined and attempts are made at identifying areas of convergences and divergence. Part 4 Concludes.
II. OVERVIEW OF ECONOMIC POTENTIALS AND FDI RELATIONSHIPS
United States of America
Presently, the United States has the largest and most technologically powerful economy in the world, with a per capita GDP of $49 8000. As at 2012, it had a population of 313.9 million with a GDP growth of 2.8% and an inflation rate of 1.5%. Further, the United States has a mixed economy and has maintained a stable overall GDP growth rate, a moderate unemployment rate and high level of capital investment. The United States has a well-developed infrastructure and high productivity. In addition, the United States is the second-largest trading nation in the world behind China.
As at 2010, the US remains the world's largest manufacturer representing a fifth of the global manufacturing output. Of the world's 500 largest corporations, 132 are headquartered in the US, twice that of any other country. In addition, the United States has one of the world's largest and most influential financial markets. The New York Stock Exchange is by far the world's largest stock exchange by market capitalization.
The US remains one of the world's leading capital exporter and importer, foreign investments made in the US total almost $2.4 trillion, while America investments in foreign countries total $3.3 trillion. Consumer spending comprises 71% of the US economy in 2013. The United States has been rated as one of the top-performing economies in studies such as the Ease of Doing Business Index, the Global Competitiveness Report.
Specifically in relation to China and Nigeria, US investment in China as at January 2014, rose by 34.9 percent to $369 million, with China's service industry continuously serving as a strong magnet for overseas investors, absorbing 56 percent of FDI. It should however be noted that despite the huge and continuous increase in bilateral investment relationship between the United States and China there is no Bilateral Investment Treaty (BIT) presently concluded by both countries. Often times, the substantive and even procedural protection afforded to investors from both countries are contained either in the investment agreement or in national legislations.
In the case of Nigeria, it remains the U.S largest trading partner in sub-Saharan Africa and the U.S is the largest foreign investor in Nigeria, with U.S FDI concentrated largely in the petroleum/mining and wholesale trade sectors. The U.S is present in Nigeria's oil sector through Chevron, Texaco and Exxon Mobil, had investment stock of US$3.4 billion in Nigeria as at 2008. There is no specific BIT concluded between the U.S and Nigeria. The Trade and Investment Framework Agreements concluded by both countries in 2000 cover trade and Investment relationships.
A review of China's economic prospects show that with a population of 1.3 billion people, a GDP of $8.227 trillion, a GDP growth of 7.8% and an inflation rate of 2.6%, it has become the second largest economy and is increasingly playing an important and influential role in the global economy. In 1978, China initiated market reforms that has seen it shift from a centrally planned to a market based economy and experienced rapid economic and social development.
Despite its economic success, China remains a developing country (its per capita income is still a fraction of that in advanced countries) and its market reforms are incomplete. Rapid economic ascendance has brought on many challenges as well, including high inequality, rapid urbanization, challenges to environmental sustainability; and external imbalances. China also faces demographic pressures related to an aging population and the internal migration of labour.
FDI inflows into China in 2013 rose to a record of $117.6 billion. At the same time, Chinese companies are expanding abroad, with outbound FDI at $ 7.23 billion, up 47.2% from year earlier. From available data, Chinese investors have invested $14 billion in the US in 2013. This double increase in volume of investment have been driven by large-scale acquisition in food, energy and real estate. Recently, China has been increasingly involved in the African continent; no bilateral China-Africa relationship is evolving faster than the one between China and Nigeria. From less than $2 Billion in 2000, trade and investment between China and Nigeria reached nearly $18 Billion just ten years later. Between 2003 and 2009, Nigeria was a top destination for Chinese FDI on the continent, second only to South Africa. Sectorial distribution of Chinese FDI in Nigeria shows that it is mainly focused on oil exploration and mining, building and construction, agriculture and information and communication technology. With oil and gas receiving 75% of China's FDI in Nigeria. China and Nigeria first concluded a BIT in 1997, though the China-Nigeria BIT (2001) has replaced the 1997 BIT.
In the case of Nigeria, it presently stands as the most populous country and largest economy in Africa. It accounts for 47% of West Africa's population with a population of 170 million people. Further, it has a GDP of $459.6 billion, GDP growth of 6.7% and an inflation rate of 8.5%. It is also the biggest oil exporter in Africa, with the largest natural gas reserves in the continent.
It is important to point out that that despite the fact that Nigeria is Africa's largest economy; it is still largely a developing economy that depends on oil revenue, which constitute 90% of its export and 75% of its consolidated budgetary revenues. It is also faced with infrastructural and developmental challenges. These have triggered and led to the government carrying an ambitious reform agenda. With its large reserves of human and natural resources, Nigeria is poised to build a prosperous economy, significantly reduce poverty, and provide health, education and infrastructure services to meet its population needs.
The government has expressed determination to make job creation central to its economic strategy and has specifically targeted the ICT, entertainment, meat, leather, construction and tourism industries. Despite a strong economic track record, poverty is significant, and reducing it will require strong non-oil growth and a focus on infrastructural development.
With the return to democratic governance in 1999, FDI inflows increased from US$ 1 Billion in 1999 to US$ 2 Billion in 2003, making Nigeria the fourth largest recipient of FDI inflows amongst African countries. As at 2013, FDI in Africa and Nigeria was $43 Billion, with Nigeria getting $8 Billion of the funds. Significant source of FDI in Nigeria comes from the US, China, United Kingdom, Italy, Brazil, the Netherlands, France and South Africa. Specifically in relation to the United States, Nigeria's FDI (Stock) was $22 million in 2012 up by 15.8% from what it was in 2011. The increase in Nigeria's FDI in the U.S may be largely attributed to the investment activities of the Nigeria Sovereign Investment Authority (NSIA) a sovereign investment fund of the Nigerian Government with statutory authorization to invest in US stocks. In the case of China, recent developments have shown that Nigeria-China investment relationship is not a one-way traffic. Although on a small scale, Nigerian companies and investors are making forays into the Chinese market.
Direct investment by African countries totaled nearly US$10 billion by the end of 2009, and Beijing list Nigeria among the top five African countries investing in China. In 2010, First Bank of Nigeria Plc opened a representative office in Beijing, becoming the first Nigeria bank to penetrate the Chinese market. The bank offers an array of services to its customers in Asia, including Chinese companies seeking to enter the Nigerian market. Also among First Bank's other client, undoubtedly, are some of the Nigerian diaspora, many of whom are engaged in exporting chinese products to Nigeria.
II· THE TREATY AND STATUTORY FRAMEWORK
A. The ICSID Convention
The United States of America signed the ICSID Convention on August 27, 1965. Its deposit of ratification was on June 10, 1966 and on October 14, 1966, its Convention obligations entered into force. China signed the Convention on February 9, 1990; its deposit of ratification was on January 7, 1993 and on February 6, 1993, the Convention entered into force for it. In the case of Nigeria, it signed the Convention on July 13, 1965; its deposit of ratification was on August 23, 1965 and its Convention obligations entered into force on October 14, 1966.
The key provisions relating to the jurisdiction of the Centre are detailed in Article 25 - 27 of the Washington Convention. Under Article 25(1), the Centre shall have jurisdiction over:
- a legal dispute;
- arising directly out of an investment;
- between a contracting state and national of another contracting state; and
- the parties to the dispute have consented in writing to submit the dispute to the Centre.
The above shows that Article 25 contains the requirement relating to the nature of the dispute (ratione materiae) and to the parties (ratione personae). In addition, the parties must have given their consent. The requirements relating to the nature of the dispute are that, it must arise directly from an investments and that it must be a legal nature. Those relating to the parties specify that one side must be a contracting state and the other a national of another contracting state. This provision clearly denotes that in relation to any investment in the US, China and Nigeria, a foreign investor from one of these states or any other contracting states of the Convention can commence an ICSID arbitration once it satisfies the jurisdictional threshold.
According to Lucy Reed, Jan Paulsson and Nigel Blackaby, these jurisdictional requirements are mandatory. Parties to an investment contract before concluding their ICSD arbitration clause must ensure that the above criteria are met or will have been met if, and when a dispute arises between them. The parties may not waive these jurisdictional criteria by contractual stipulation. If the jurisdictional requirements are not met, the Centre must and will refuse to administer a dispute, even if the parties have contractually designated ICSID.
The ICSID Convention does not offer a specific definition of the term 'investment'. Lucy Reed et al consider this a deliberate decision by the drafter who recognized that given the pivotal role of consent, a definition of the term could prove unhelpfully restrictive. Instead, the drafter preferred to leave it to parties to agree upon what constitutes an investment under particular circumstances. Specific examples of projects and transactions that have been held by ICSID tribunal to qualify as investment under Article 25 ranges from infrastructure projects, disputes over capital contributions and other equity investments in companies and joint ventures as well as non-equity direct investments via service contracts, transfer of technology, natural resource concession agreements, and projects for the construction and operation of production and service facilities in the host State.
Based on the prior discussion in part 2 of this paper, this clearly shows that the various FDI into the US, China and Nigeria may all qualify for investment upon which the Centre can exercise jurisdiction unless the investor and the particular state have in the Investment contract excluded such an investment or recourse to ICSID.
On the consent requirements under Article 25, while consent must be in writing, there are no other requirements as to form the consent should take. Stephen Jagusch and Jeffrey Sullivan have opined that, while consent must be in writing, there are no other requirement as to form the consent should take. Typically, a state's consent will be given by way of a bilateral or multilateral investment treaty (this unilateral consent becoming bilateral and binding when a foreign investor files a request for arbitration with the Centre); a local investment law (where equally consent is deemed to be a unilateral offer by the state, which is accepted when the foreign investor files or submit it dispute to the Centre); or by way of an investment contract.
Upon the completion of the arbitral process and the issuance of an award, the ICSID Convention provides for rigorous finality and seeks to establish optimal preconditions for the recognition and enforcement of award in the award in a manner that distinguishes ICSID from other international arbitral regimes. There is a need in the cases that do proceed to award, that participant must understand what will happen if the losing party fails to comply with the award voluntarily and the prevailing party takes the award through phases known as "recognition", "enforcement" and "execution". According to Lucy Reed et al, recognition is the formal certification that an ICSID award is a final and binding disposition of contested claims. While enforcement loosely refers to an award creditor's legal right to execute its award - i.e., to collect monetary damages or benefit from other remedies granted - and is thus another way of referring to execution.
Section 6 of the ICSID Convention, which is comprised of Article 53, 54 and 55, is entitled "Recognition and Enforcement of the Award." Article 53 (1) of the Convention provides that awards rendered by ICSID tribunals are "binding upon the parties and shall not be subject to any appeal or to any other remedy except those provided for in the Convention." The Article further requires the parties to the arbitration to abide by and comply with, the term of award, thus making enforcement proceedings theoretically unnecessary. It has been suggested that Article 53 reflects the intent and desire of those States subscribing to the ICSID Convention that parties would abide by and comply with the terms of an arbitral award. An Obligation to satisfy an award at the time the award is issued, and is not dependent upon the recognition or enforcement of the award by a national court.
Article 54 deals more specifically with recognition and enforcement. It has been argued that Article 54 appears to contemplate three (sic) types of awards, as follows (a) pecuniary awards; and (b) non-pecuniary awards, including (i) declarations of right and obligations and (ii) orders of specific performance. Article 54 requires all member States to recognize and enforce an ICSID award. It provides thus:
(1) Each contracting State shall recognize an award rendered pursuant to this Convention as binding and enforce the pecuniary obligation imposed by that award within its territories as if it were a final judgment of a court in that State. A Contracting State with a federal constitution may enforce such an award in or through its federal courts and may provide that such courts shall treat the award as if it were a final judgment of the courts of a constituent state.
(2) A party seeking recognition or enforcement in the territories of a Contracting State shall furnish to a competent court or other authority, which such State shall have designated for this purpose a copy of the award certified by the Secretary-General. Each Contracting State shall notify the Secretary-General of the designation of the competent court or other authority for this purpose and of any subsequent change in such designation.
(3) Execution of the award shall be governed by the Laws concerning the execution of judgment in force in the State in whose territories such execution is sought.
Several commentators have attempted to explain the meaning of "recognition", "enforcement" and "execution" as used in Article 54. For instance a leading commentator, Christoph Schreuer, notes that courts and authors have used the term 'enforcement' variously to denote 'execution', 'recognition' or a broad concept embracing all steps covered by Article 54. Schreuer warns that great caution should be exercised when using the word 'enforcement' in the context of Article 54. The leading commentator on his part considers the term 'enforcement' as meaning the same as 'execution'. We respectfully disagree with this view, on the basis that a reading of Article 54 in the manner suggested by the learned commentator would render redundant the execution mechanism provided under the domestic law of a Contracting States.
On the other hand, Lucy Reed et. al, conclude that "[i]n the context of ICSID arbitration, enforcement is generally indistinguishable from recognition. The two terms - recognition and enforcement - tend to be used in a single phrase that broadly refers to all steps leading up to, but stopping short of, actual execution of an award. Further, Antonio R. Parra opined that the regime of the Convention does not, however, extend to the execution of the award. Such execution he suggests is in accordance with Article 54(3) of the Convention governed by the law on the execution of judgments in force in the country where execution is sought.
A third view suggest that recognition, enforcement and execution in the ICSID award context as points progressing along a single continuum as follows: (1) "recognition" refers to confirmation or certification of an ICSID award as a final and binding disposition of claims, with res judicata effect; (2) "enforcement" refers to converting the ICSID award into a judicial judgment that orders an award debtor to comply with the award, including paying any monetary sum due; and (3) "execution" refers to coercive measures that an award creditor may take when an award debtor refuses to pay the converted award voluntarily.
The author totally agree with the above views expressed by Lucy Reed et. al, Antonio R. Parra and those of the New York City Bar Committee, in fact the interpretation of Article 54 by the New York City Bar Committee most succinctly explains the distinction between the "recognition" , "enforcement" and "execution" of an ICSID award. The only step necessary to receive recognition and enforcement of an award within the territory of a Contracting State to the Convention is to deposit, with the designated competent court or authority of that State, a copy of the award certified by the Secretary-General of the Centre. Thus, according to Stephen Jagusch & Jeffrey Sullivan, review by the national courts where enforcement is sought, whether for compliance with a municipal arbitration law or under the ground for refusal of enforcement provided by Article V of the New York Convention, is not permissible.
Article 55 of the Convention provides that "[n]othing in Article 54 shall be construed as derogating from the law in force in any Contracting State relating to immunity of that State or any foreign State from execution." This provision is aimed at scenarios or circumstances where the judgment debtor is a sovereign State, and its application is strictly limited to the execution stage. It has no bearing on the recognition phase of the process. Submission to arbitration may be seen as a waiver of immunity in proceedings to have the award recognized. Therefore, the effect of the award as res judicata will apply irrespective of any immunity from execution.
In addition to the specific provisions (Articles 53-55) of Section 6 dealing with the recognition, enforcement and execution of an ICSID award, Article 69 of ICSID Convention instruct contracting states to "take such legislative or other measures as may be necessary for making the provisions of the Convention effective..." Such legislative measure include an obligation to ensure that an ICSID award shall be binding on the parties and shall not be subject to any appeal or to any other remedy.
Although, the ICSID Convention specifically insulates awards from review under national laws at recognition and enforcement stage, it offers no such insulation when award are to be executed against specific assets. The pecuniary obligation arising from ICSID award must be recognized and enforced in all contracting states, as if they were final judgments of the courts of those states. From a review of the travaux preparatoires of the Convention, it seems that the modus vivendi agreed was that the binding character of obligations in the award would be recognized inter partes, but that states are not under an obligation to enforce non-pecuniary obligations - hence the clear focus on monetary damages in almost all cases, while recognizing that non-pecuniary remedies may be ordered by a tribunal. Article 54 (3) of the Convention stipulates that the execution of ICSID awards "shall be governed by the law concerning the execution of judgments in force in the State in whose territories such execution is sought." The implication of this is that national courts in Contracting States must recognize and enforce awards according to the Convention, i.e., immediately and without review, but they may execute them according to their own national law.
B. Domestic Law Regime
In the United States, the ICSID Convention implementing Statute is the Foreign Relations and Intercourse (2000) 22 U.S.C § 1650a and it provides in relevant part as follows:
(a)An award of an arbitral tribunal rendered pursuant to chapter IV of the Convention shall create a right arising under a treaty of the United States. The pecuniary obligations imposed by such an award shall be enforced and shall be given the same full faith and credit as if the award were a final judgment of a court of general jurisdiction of one of the several States. The Federal Arbitration Act shall not apply to enforcement of award rendered pursuant to the convention.
(b)The district courts of the United States shall have exclusive jurisdiction over actions and proceedings under subsection (a) of this section, regardless of the amount in controversy.
The plain language of the Statute provides that an ICSID award creates a right arising under a treaty of the United States, and that the pecuniary obligations imposed by such an award shall be enforced and given the same "full faith and credit" as if the award were a final judgment of a court in the United States. A reading of Article IV of the U.S. Constitution, the "Full Faith and Credit Clause," shows that it requires States in the U.S to recognize judgment rendered by the courts of other states. The Full Faith and Credit Clause also applies in the context of federal courts recognizing state court judgments pursuant to 28 U.S.C § 1738 under which a judge of federal court must honor judgments of the courts of the Fifty States. Accordingly, 22 U.S.C § 1650a, (a) makes clear that ICSID award shall provide the same full faith and credit as a state court judgment for purposes of enforcing the ICSID award's pecuniary obligations.
The latter caveat that the Federal Arbitration Act (FAA) does not apply to ICSID awards serves to further strengthen the enforceability of ICSID awards as it means that defenses available under the FAA are not available to parties seeking to challenge enforcement of an ICSID award. Together with the Convention's binding force and enforcement provisions, the implementing statute should render an ICSID award nearly impervious to challenge in US courts. This, after all, was the idea behind the Convention in the first place: to create a comprehensive, self-sufficient system of international arbitration in the area of investment disputes with minimal national interference and in which the 'tribunal's award would be directly enforceable within the territories of the States parties.
It is a trite point that an ICSID arbitration necessarily involves a foreign sovereign or related entity. Accordingly, proceedings in the United States to execute ICSID awards implicate the Foreign Sovereign Immunities Act (FSIA), which affords significant protections to foreign sovereigns concerning the execution of judgments. Under the FSIA, only a property that is used for commercial purposes is subject to execution to satisfy a judgment. In relevant part, it seek to ensure that the property of a foreign state that is used for a commercial activity in the United States shall not be immune for execution or attachment where a judgment is based on an order confirming an arbitral award. For example, no execution activity against a foreign sovereign may be undertaken until the federal court has expressly ordered attachment and execution. Specifically, 28 U.S.C § 1610 (c) requires district courts to determine that "a reasonable period of time has elapsed following the entry of judgment" prior to granting leave to commence execution activities. This requirement is designed to afford a foreign sovereign sufficient time to pay the judgment if it chooses to do so voluntarily. A party seeking to execute a judgment against a foreign sovereign must first make a motion to the district court pursuant to 28 U.S.C §1610 (c) explaining why it believes that a reasonable period of time has elapsed and why execution should be permitted.
Unlike China and Nigeria, the U.S has experienced a handful of cases involving the enforcement, recognition and execution of an ICSID award. For instance, in one of the earlier cases, a case which clearly illustrates the distinction between the concepts of recognition, enforcement and execution. The ICSID award was issued in the case was issued against Liberia and in favor of the Liberian Eastern Timber Corporation, a company controlled by French nationals. The award was on the company's application granted recognition and enforcement by an order of the US. District Court for the Southern District of New York. On the strength of that order, execution was issued on registry fees and taxes due to Liberia from ship-owners and agents of Liberia in the United States. On Liberia's motion, the same District Court having found assets to be immune from execution under the 1976 United States Foreign Sovereign Immunities Act (FSIA), because there were sovereign rather than commercial assets, vacated the execution on those assets.
The Company then obtained writs of attachment seizing bank accounts of the Embassy of Liberia in Washington D.C. The United States District Court for the District of Columbia, however, quashed the writs on the ground that the Embassy's bank account were immune from attachment because they enjoyed diplomatic immunity under the Vienna Convention on Diplomatic Relations, which the United States ratified in 1972, and also because the accounts were entitled to sovereign immunity under the FSIA, the funds in the accounts were essentially public in nature.
In China, there is no domestic PRC legislation that specifically implements the obligations under the ICSID Convention. However, if a party brought an ICSID award to China, it would likely invoke Article 269 of the Civil Procedural Law, which provides thus, "If an award made by a foreign arbitration agency requires the recognition and enforcement by a people's court of the People's Republic of China, the party concerned shall directly apply to the intermediate people's court in the place where the party subject to execution as its domicile or where its property is located. The people's court shall deal with the mater in accordance with the relevant provision of the international treaties concluded or acceded to the People's Republic of China or on the principle of reciprocity."
Another important provision that can be invoked is Article 238 of the CPL, which provides that "if an international treaty concluded or acceded to by the People's Republic of China contains provisions differing from those found in this law, the provisions of the international treaty shall apply, unless the provisions are the ones on which China has announced reservations."
According to Julian Ku, a leading Chinese law scholar, on its face, Articles 269 and 238 of the CPL allow parties seeking to enforce an ICSID award to invoke the ICSID Convention itself. Read in this light, Article 269 of the CPL makes clear that intermediate people's court should treat ICSID award consistent with the Article 54 of the ICSID Convention e.g. as final judgments of domestic courts. Article 238 would then make clear that no other domestic law could override Article 54 of the ICSID Convention's requirements. Julian Ku, however concedes that her interpretation of the CPL, requires the assumption that PRC law can incorporate treaties directly and even to override inconsistent domestic law. Another notable Chinese scholar, Tieya Wang, who argues that China has adopted a system of "adoption" for international treaties into its domestic law without any separate act of "transformation" by the governmental authorities, also supports this view.
It is however important to note that though the "adoption" doctrine has been the pre- dominant view, China's accession to the WTO created a shift or questioning of the theory. This was largely because the WTO Agreement and its annexes were not directly incorporated by most WTO states and this prompted Chinese courts and Chinese scholars to eventually conclude that the WTO Agreements should not be "adopted" in China.
The current situation in China depicts a constitutional lacuna; one which possess the potentials of resulting in a violation of China's international obligation under the ICSID Convention should the Chinese courts adopt the same approach used in the interpretation of its WTO obligations. The unsettled state of the doctrine on treaty implementation means that even provisions such as Articles 269 and 238 of the CPL do not guarantee that PRC courts will enforce ICSID awards. As pointed out by Julian Ku, we agree with recent scholarship that has repeatedly called for either constitutional amendments or a legislation to clarify the status of treaties and confirm that adoption permits direct application of many international treaties. This will effectively stabilize or concretize the fluid status of Chinese legal doctrine on the incorporation of treaties.
In comparison to the United States, China's domestic law regime for the execution of ICSID awards is a far cry. Unlike the U.S, which has a well-defined and robust constitutional and statutory regime for the implementation of its treaty (ICSID) obligations, China's constitutional framework for the implementation of treaties is in a fluid state. In addition, unlike the U.S, there are no specialized legislations like the FRI and FSIA, which facilitates the effective execution of an ICSID award. China relies on its Civil Procedure Law for the execution of an ICSID and even a New York Convention award. Such a reliance on the same statutory instrument for the enforcement or execution of an ICSID and NY Convention award raises serious concerns, given that nothing in the law prevents a losing or defending sovereign from relying on Article 217 of the CPL to challenge the execution of an ICSID award. This will not only be a violation of the intent and express provision of the ICSID Convention; it is also capable of throwing up the constitutional dilemma of whether a treaty has a direct effect in China without any form of adoption or transformation.
Upon on a comparison of China's domestic law regime vis-à-vis the United States, the present state of China's domestic law regime for the execution of ICSID award, could be excused on the grounds that China is a relative newcomer to the arena of international arbitration and particularly the ICSID. More so, there have been no attempted execution of an ICSID award against China or to the best of the author's knowledge and research, against the assets of any sovereign in China. Such an enforcement and execution proceeding could have thrown up the practical loopholes or deficiency of the present Chinese regime. The author is the opinion that there is a dire need for China to amend its constitution or take steps to enact legislations that will not only provide clarity on its treaty incorporation doctrine and the effect, but that will also specifically provide or deal with the execution of an ISCID award as anticipated by the ISCID Convention.
With its signing of the ICSID Convention, Nigeria took steps to give effect to its ICSID obligations by enacting the International Centre for Settlement of Investment Disputes (Enforcement of Awards) Act on November 29, 1967. The ICSID Act is primarily and specifically aimed at providing for the enforcement in Nigeria of an award rendered under the auspices of the ICSID.
Section 1 of the ICSID (Enforcement of Award) Act provides as follows:
"(1) [w]here for any reason it is necessary or expedient to enforce in Nigeria an award made by the International Centre for Settlement of Investment Disputes, a copy of the award duly certified by the Secretary-General of the Centre aforesaid, if filed in the Supreme Court by the party seeking its recognition for enforcement in Nigeria, shall for all purposes have effect as if it were an award contained in a final judgment of the Supreme Court, and the award shall be enforceable accordingly.
(2) The Chief Justice of Nigeria may make rules of court or may adapt rule of court necessary to give effect to this section."
The spirit or intent of the above provision is that an ICSID award has effect as if it were a final judgment of the Supreme Court of Nigeria, which is the highest court in Nigeria. The apparent effect is that by providing for enforcement in the Supreme Court of Nigeria, it obviously eliminates challenges and appeals associated with enforcement in court of first instance and the Court of Appeal. It is important to note that as at today, the Chief Justice of Nigeria is yet to make any rules or adopt an existing rule of court to give effect to the ICSID (Enforcement of Award) Act. However one can borrow a cue from the Supreme Court Rules 1999 (as amended) which provides under its Order 17 and 18 that, "any decision, including judgment, decree or order, given by the Court may be enforced by the court... (18) When any decision of the Court including judgment, decree or order is to be enforced by any other court with subordinate jurisdiction, a certificate under the seal of the Court and the hand of the Chief Justice of Nigeria or the presiding Justice setting forth the decision shall be filed in such other court, and the later court shall enforce such decision in terms of the certificate."
While it is possible that an ICSID award creditor would naturally expect the now transformed award to be promptly obeyed or complied with, since it is has acquired the status of a judgment of the Supreme Court of Nigeria. Unfortunately, practice is sometimes far from ideal and the problem persist that the award debtor would fail to voluntary comply. It follows that upon the "transformation" of the ICSID award into a judgment of the Supreme of the Court of Nigeria for the purposes of enforcement, the next step for the judgement creditor may be to proceed with the execution of the now transformed ICSID award (Supreme Court Judgment) under the Sheriffs and Civil Process Act (SCPA) of the Federation and the Judgment (Enforcement) Rules identically worded enactments that serve as the primary legislation for the execution of a court judgment, decision, order etc.
When a sum of money is ordered to be paid, the decision may be enforced by seizure and sale of goods and securities under a writ of fieri facias (fi.fa) subject to interpleader proceedings by the Sheriff, in respect of the claim of third parties. Where sufficient movable property cannot be found, execution may be issued against immovable property, subject to the prior consent of the State Governor or Minister of the Federal Capital Territory (FCT) to its sale. In the event, the judgment debt is unsatisfied; the judgment creditor may obtain a judgment debtor summons in order that the judgment debtor may be examined on oath about his financial means. The normal outcome is an order for instalmental payment. In addition to the above means of execution, there are other analogous means of execution, such as garnishee proceedings and the appointment of a receiver. An order to do or abstain from doing a particular act may be enforced by an order of committal, or in extreme cases by a writ of sequestration.
Evaluating the foregoing Nigerian domestic law regime, one would observe that in Nigeria, just like its America counterpart, there is full and total compliance with the obligations created by the Washington Convention, particularly in relation to taking such legislative or other measures necessary for making or giving effect to the Convention in Nigeria. For instance, the ICSID (Enforcement of Award) Act complies with the obligation imposed by Article 54(2), which requires Contracting States to designate the competent court for recognition and enforcement with its territories. Further, the Sheriffs and Civil Process Act as the legislation, which facilitates the execution of an ICSID award transformed into a judgment of the Supreme Court of Nigeria, is in accordance with the provision of Article 54 (3) of the ICSID Convention.
It must however be admitted that despite the long ratification and domestication of the ICSID Convention by Nigeria, just like China, it domestic law regime for enforcement and recognition of an ICSID award remains untested.
It must however be admitted that despite the long ratification and domestication of the ICSID Convention by Nigeria, just like China, it domestic law regime for the enforcement and recognition of an ICSID award remains untested. The above discussion at best present a theoretical presentation. It is however hoped that in the not too distance future, the opportunity would arise for an ICSID award creditor to seek enforcement and execution under the Nigeria domestic law regime. Such an attempt would provide a practical reference point for workability of the regime.
At the moment, there is great enthusiasm and excitement about investment and even the prospect of investing in the United States, China and Nigeria. The volume of FDI moving to and from these three countries has hit an unprecedented record. Much is attributed to economic reforms and demographic advantage they enjoy, particular in the case of China and Nigeria who despite being developing countries rank as the second largest economy in the world and the largest economy in Africa.
A discerning investor with investment in any of these countries or even one involved in transnational investment generally should have a firm understanding of how the ultimate product (ICSID arbitral award) of ICSID arbitral proceeding or any international dispute resolution process will be treated in any of these three leading economy. In fact, it is clear from our analysis that, while the U.S may presently the best forum for the enforcement of an ICSID award given its robust and tested domestic legal framework, nothing prevents Nigeria from providing such an avenue for an investor or ISCID award creditor. On the part of China, it has achieved a tremendous success in its economic reform; however, it needs to match this reform with a clear domestic mechanism for the enforcement and execution of not just an ICSID award but also for other international obligations. This will not only deepen its commitment to the ICSID Convention, it has the potential of further strengthening investor's confidence as far as investing in China is concern.
*Author - Mr. Ikemefuna Stephen Nwoye
Principal Chief Counsel - NWOYE (Barrister and Solicitor)
*The first version of this article was presented as a paper in the International Investment Law and Arbitration class at NYU Law in 2014. All data and statistics relied on in this paper are pre-2014 or 2014.
Disclaimer: This article should not in any way serve as a substitute for legal advice or opinion. The views expressed are personal to the author and do not necessarily reflect the views of any organization or person that the author is or might have been affiliated to.
 Krista Nadakavukaren Schefer, International Investment Law Text, Cases and Materials (EE 2013) 370.
 Jose E. Alvarez, The Public International Regime Governing International Investment (AILP 2011) 17.
 Vincent O. Nmehielle, 'Enforcing Arbitration Awards under the International Convention for the Settlement of Investment Disputes' Annual Survey of International & Comparative Law: Vol. 7: Iss. 1, Article 4< https://digitalcommons.law.ggu.edu/annlsurvey/vol7/iss1/4> accessed 25 May 2014.
 Ibrahim F.I Shihata defined the ICSID as "a forum for conflict resolution in a framework which carefully balances the interest and requirements of all parties involved, and attempts in particular to 'depoliticize' the settlement of investment disputes". See Ibrahim F.I Shitata, Towards a Greater Depoliticization of Investment Dispute: The Roles of ICSID and MIGA, 1(I) ICSID Rev.- FILJ 1 (1986).
Overview of ICSID <https://icsid.worldbank.org/ICSID/FrontServlet?requestType=ICSIDDocRH&actionVal=ShowDocument&icsidOverview=true&language=English> accessed on 27 May 2014.
 It is important to point out that the author is making this assertion is not unmindful of the fact that a number of other arbitral options (UNCITRAL, ICC and PCA) and even other legal options (litigation in state courts) are available to investor who may intend to seek redress against offending Contracting state.
 CIA - The World Fact Book https://www.cia.gov/library/publications/the-world- factbook/geos/us.html accessed on 24 May 2014.
 See United States of America https://www.worldbank.org/en/country/unitedstates accessed on 24 May 2014.
 See U.S. Economy - Basic Conditions & Resources https://usa.usembassy.de/economy-conditions.htm accessed on 25 May 2014.
 Wright Gavin and Jesse Czelusta, 'Resource-based Growth Past and Present' in Daniel Lederman and William Maloney (eds), Natural Resources: Neither Curse Nor Destiny ( World Bank, 2007) 185
 Philip Inman, 'China overtakes US in world trade' The Guardian (London 11 February 2013)https://www.theguardian.com/business/2013/feb/11/china-worlds-largest-trading-nation accessed12 February 2013
 Market Capitalization of the World's Top Stock Exchanges https://www.sfc.hk/web/doc/EN/research/stat/a01.pdf
 supra note 7
"Personal consumption expenditures (PCE)/gross domestic product (GDP)" FRED Graph, Federal Reserve Bank of St. Louis
 Rankings: Global Competitiveness Report 2013-2014, World Economic Forum https://www3.weforum.org/docs/GCR2013-14/GCR_Rankings_2013-14.pdf
 China Overview <https://www.worldbank.org/en/country/china/overview> accessed on 24 May 2014.
 Petar Kujunzic, 'China January Foreign Direct Investment rises in sign of confidence' Reuters (New York, 18 February 2014) <https://www.reuters.com/article/2014/02/18/us-china-economy-fdi- idUSBREA1H02W20140218> accessed 25 May 2014.
 Dexter Roberts, 'Chinese Investment in US Doubles to $14 Billion in 2013' Bloomberg Business (New York, 08 January 2014)
https://www.businessweek.com/articles/2014-01-08/chinese-investment-into-u-dot-s-dot- doubles-to-14-billion-in-2013 accessed 26 May 2014.
Margaret Egbula and Qi Zheng, China and Nigeria: A Powerful South-South Alliance (EOA 2011) 11
 Corporate Nigeria <https://www.corporate- nigeria.com/index/fdi/foreign_direct_investment_overview.html> accessed 04 May 2014.
 World Bank, 'Overview of Nigeria' < https://www.worldbank.org/en/country/nigeria.> accessed 05 May 2014.
E.Olawale Ogunkola, Abiodun S. Bankole and Adeolu Adewuyi, 'China-Africa Investment Relations: A Case Study of Nigeria' (Trade Policy Research and Training Programme, Department of Economics University of Ibadan, Nigeria. 2008) < https://dspace.africaportal.org/jspui/bitstream/123456789/32058/1/Nigeria.pdf? > accessed 29 April 2014.
World Bank 'Nigeria, others get $43billion FDI inflow rise in 2013' Daily Independent (Lagos, 21 January 2014) <https://dailyindependentnig.com/2014/01/nigeria-others-get-43b-fdi-inflow-rise-in-2013-world- bank/ > accessed 12 May 2014
 Kamarudeen Ogundele, 'Nigeria attracts $8bn in Foreign Direct Investment' Punch (Lagos, 16 January 2014) <https://www.punchng.com/business/business-economy/nigeria-attracts-8bn-in-foreign-direct- investment-fg/ > accessed 04 April 2014.
 Egbula & Zheng(n 23)
Part of the acceptable investment for the Nigerian Fund are US Treasury Bills, US Treasury bond with a maturity of less than three years, Investment grade debt from corporate issuers with a maturity of less than three years. See NSIA Stabilization Fund - Investment Policy Statement < https://nsia.com.ng/wp-content/uploads/2013/08/Investment- Policy-Statement-for-Stabilisation-Fund.pdf > accessed 08 May 2014.
 Egbula & Zheng(n 23) 10.
 List of Contracting States and Other Signatories of the Convention (as at April 2014) <https://icsid.worldbank.org/ICSID/FrontServlet?requestType=ICSIDDocRH&actionVal= ShowDocument&language=English. > Accessed 10 May 2014
 Christoph H. Schreuer, The ICSID Convention: A Commentary (CUP 2009) 82.
 Lucy Reed, Jan Paulsson and Nigel Blackaby, Guide to ICSID Arbitration (Kluwer Law Int'l 2011) 18
 Ibid. at 26.
Stephen Jagush & Jeffrey Sullivan, A Comparison of ICSID and UNCITRAL Arbitration,in Michael Waibel. Asha Kaushal, Kyo-Hwa Liz Chung & Claire Balchin (eds) The Blacklash against Investment Arbitration Perception and Reality (Kluwer Law Int'l 2010) 86
 Ceskoslovenka obchodni banka, a.s v. Slovak Republic, ICSID Case No. ARB/97/74, Decision on jurisdiction (May 24, 1999) 14 ICSID Rev.- FILJ 251 (1999).
Reed et.al (n 40) 179.
 Ibidat 181.
 The Report on Recommended Procedures for Recognition and Enforcement of International Arbitration Awards Rendered under the ICSID Convention - the Committee on International Commercial Disputes New York City Bar P.211
 Reed et.al (n 40)185.
 Schreuer (n 39) 1136.
 Antonio R. Parra, 'The Enforcement of ICSID Arbitral Awards" Session on Specific Aspects of State-Party Arbitration' 24th Joint Colloquium on International Arbitration Paris, November 16, 2007.
 Reed et.al (n 41).
Stephen Jagusch & Jeffrey Sullivan (n 44) 100.
 Schreuer (n 38) 1153.
 James W Barrat, Margarita N Michael, "The 'Automatic' Enforcement of ICSID Awards: The Elephant in the Room?" < https://globalarbitrationreview.com/reviews/58/sections/202/chapters/2274/the-automatic-enforcement-icsid-awards-elephant-room/ > accessed 10 May 2014.
 NYC Bar Report (n 48) at 214.
 The Section provides thus, "[t]he Act of the legislature of any State, Territory, or Possession of the United States, or copies thereof, shall be authenticated by affixing the seal of such State, Territory or Possession thereto.
The records and judicial proceedings of any court of such State, Territory or Possession, or copies thereof, shall be proved or admitted in other courts within the United States and its Territories and Possessions by the attestation of the clerk and seal of the court annexed, if a seal exists, together with a certificate of a judge of the court that the said attention is in proper form.
Such Acts, records and judicial proceedings or copies thereof, so authenticated, such have the same full faith and credit in every court within the United States and its Territories and Possession as they have by law or usage in the Court of such State, Territory or Possession from which they are taken."
 Roger P. Alford, Federal Courts, International Tribunals and the Continuum of Deference (2003) 43 Va.J. Int'l. 675, 686 - 87.
 Jack Thomas and Amal Bouhabib, 'Confirming ICSID Awards in US Courts over Sovereign Objections: Duke and Blue Ridge' International Litigation News, Newsletter of the International Bar Association Legal Practice Division April 2013. p.87
 28 USC §1610 (a) (6).
 Ibid. at 215.
 Liberian Eastern Timber Corporation v. Liberia, Decision of Dec.12. 1986 of the U.S District, Southern District of New York, 650 F.Supp. 73 (1986); 2 ICSID Rev. - FILJ 188 (1987). See a summary of the relevant portion of the case in Parra, (n 53) 4.
 See Decision of April 16, 1987 of the U.S District Court, District of Columbia, 659 F. Supp. 606 (1987); (1988) 3 ICSID Rev.- FILJ 16. See also Creditor fails to attach DRC oil payments in US. <https://globalarbitrationreview.com/news/article/32509/creditor-fail-attach-drc-oil-payment > accessed 11 May 2014.
 Julian Ku, 'The Enforcement of ICSID Awards in the People's Republic of China' (2013) 38 6 (1) Contemp. Asia Arb.J. 31 p.39.
 Tieya Wang, 'The Status of Treaties in the Chinese Legal System' (1995) 1 J Chinese & Comp L. 1, 4.
 For instance, Yong-Wei Liu, 'Some New Thoughts on Application of International Treaties in China' (2007) 2 Jurist Rev. 143, 144 has argued in favor of rejecting direct incorporation completely.
 Article 69 of ICSID Convention.
 Ku (n 64) 39-40.
 Article V, section 1, clause 2 of the US Constitution and pages 18-21 above, which discuss the domestic law regime in the US.
 Ku (n 64) 40 - 44.
 Based on the information available from the ICSID website, there have only being two cases against China while one of the cases was discontinued, the other is still pending. The cases are (1) Ekran Berhad v. People's Republic of China (ICSID Case No. ARB/11/15). The case was registered with the Centre on May 24, 2011 and it was in respect of a dispute that arose from Arts and Culture facilities. On May 16, 2013, the case was discontinued and the Secretary-General issued a procedural order-taking note of the discontinuance of the proceeding pursuant to ICSID Arbitration Rule 43 . (2) Ping An Life Insurance Company of China, Limited and Ping An Insurance (Group) Company of China, Limited v. Kingdom of Belgium (ICSID Case No. ARB/12/29). The case was registered on September 19, 2012 and it is still pending. See 'China' <https://icsid.worldbank.org/ICSID/FrontServlet?requestType=SearchRH&actionVal=SearchSite&Searchltem=China.>
 Emmanuel Dike, 'Facts and myths on the enforcement of foreign arbitral awards in Nigeria' < https://www.cdr-news.com/categories/nigeria/facts-and-myths-on-the-enforcement-of- foreign-arbitral-awards-in-nigeria > accessed 03 March 2014.
 Cap 407 Laws of the Federation of Nigeria 1990.
 Made pursuant to Section 94 of the Sheriffs and Civil Process Act.
 S. 20 & 25 of the Sheriffs and Civil Process Act.
 This is a writ of execution after judgment obtained in a legal action for debt or damages. It is used under the English common law to command the sheriff to make good the amount out of the goods of the person against whom judgment has been obtained.
 Section 34 of the SCPA provides for Interpleader proceedings i.e. If a claim is made to or in respect of any property attached in execution under process of a court, or in respect of the proceeds or value thereof, the registrar may, upon the application of the Sheriff, as well before as after any action brought against him, issue a summons calling before the court the party at whose instance the process issued and the party making the claim. (2) Upon the issue of the summons, any action brought in any court in respect of the claim or of any damage, arising out of the execution of the writ shall be stayed.
 Sheriffs and Civil Process Act, s.44.
 Section 1 of the Land Use Act No.6 of 197 vest ownership of Lands (immovable) in the State Governor.
 J.O Fabunmi and O.O Akai, 'Execution of Judgments and the Means of Enforcement Available to a Court in Nigeria' (2009) Journal of African Law, 32, pp 164 - 181.
 Sheriffs and Civil Process Act s.83. It is important to point that in relation to garnishee proceedings Section 84 of the SCPA provides that, "where money liable to be attached by garnishee proceedings is in the custody or under the control of a public officer in his official capacity or in custodial egis, the order nisi shall not be made under the provisions of the last preceding section unless consent to such attachment is first obtained from the appropriate officer in the case of money in the custody or control of a public officer or of the court in the case of money in custodial legis as the case may be... (3) In this section, "appropriate officer" means - (a) in relation to money which is in the custody of a public officer who holds a public office thereof to the garnishee, in such manner as the court may direct such debt in his hands
 Sheriffs and Civil Processes Act s 72.
 Sheriffs and Civil Processes Act s 82.
The author is not aware of any attempt(s) to enforce or execute an ICSID award against foreign sovereign in Nigeria. In fact, as at May 2014 only three cases involving Nigeria as a defendant have been instituted in ICSID. They are: (1) Guadalupe Gas Product Corporation v. Nigeria (ICSID Case No. ARB/78/1) was registered on March 20, 1978. It involved a dispute arising from a production and marketing of liquefied natural gas investment. Settlement agreed by the parties and settlement recorded at their request in the form of an award (Award embodying the parties' settlement agreement was rendered on July 22, 1980, pursuant to Arbitration Rule 43 (2)); (2) Shell Nigeria Ultra Deep Limited v. Federal Republic of Nigeria (ICSID Case No. ARB/07/18) was registered on July 26, 2007. It involved a dispute, which arose from Hydrocarbon concession. The proceeding was discontinued and the Tribunal issued an order-taking note of the discontinuance of the proceeding pursuant to ICSID Arbitration Rule 43 (1) on August 1, 2011 (3) Interocean Oil Development Company and Interocean Oil Exploration Company v. Federal Republic of Nigeria (ICSID Case No. Arb/13/20) was registered on September 09, 2013. It is in relation to a dispute arising from an oil exploration and production joint venture. The case is currently pending. See ICSID Overview, 'Nigeria' websitehttps:icsid.worldbank.org/ICSID/FrontServlet?requestType=SearchRH&actionVal=SearchSite&SearchItem=Nigeria.