론스타의 ISD 제소사건에 대한 쟁점과 향후 개선방안

Abstract

On November 21, 2012 Lone Star accused Republic of Korea Government for a breach of ‘Agreement Between The Government Of The Republic of Korea And The Belgium-Luxembourg Economic Union For The Reciprocal Promotion And Protection Of Investments’. It has received great attention because of the first ISD lawsuit in Korea. We will try to understand the reaction of Korea Government and also reviewed the improvement future plans. First, There has been no the investment provisions of the legality over Korea-Belgium BIT. So We reviewed in a roundabout way to deduct investment legality and to demonstrate that industrial capital cannot have the bank in municipal law, after whether to get the decision that it is no jurisdiction through drawing it. Second, There has been no prohibition regulation of a paper company in Korea-Belgium BIT. We examined that principle of substantial taxation could be invoked through the case of domestic courts. Consequently, a paper company will exclude in tax treaty through principle of substantial taxation and principle of faithful interpretation. Third, we reviewed that Lone Star could be taxed because they have a permanent establishment of foreign corporation or deemed permanent establishment to have it. There is a point how prove that a former CEO of Lone Star Korea is whether a substitute of Lone Star or a face guy of Lone Star. Fourth, we reviewed the ICSID/NAFTA arbitration cases so that we know whether the reaction of Korea would be indirect expropriation. And It could be in an unfavorable situation to us because of the possibility of closed doors administration and its arbitrary decision. Fifth, we reviewed that It could be possible for Korea-Belgium BIT to deny reimbursement procedures because Congress had not ratified and to consider it different from a court of arbitration, we also predicted the results. Sixth, we studied that it is available to exclude ISD as the contract between nation and investor. Consequently, if the contract is available, many problems in ISD can get to solve it. Lastly, we discussed the pros and cons of ISD and the revised rule to improve it. There are solutions that sharing information of the opposing company, repealing ISD prior consent article, introducing reexamination system, excluding that protect a paper company article, introducing criminal discovery system, plaintiff pays arbitration costs of defendant as dismissing the arbitration of plaintiff.