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About the author: Ahan Gadkari serves as a Research Assistant under Dr. Aniruddha Rajput, Member, UN International Law Commission. On March 12, 2021, the UN Open-Ended Working Group (OEWG) adopted a final report reaffirming the widely held belief that international law (IL) encompasses cyberspace. Several countries have expressed this belief in proposals requesting that the OEWG address cybersecurity issues. (See here, here, here and here). Therefore, the academic debate surrounding cyberspace can shift towards determining the scope of IL. The Oxford Process and Tallinn Manual 2.0 are two of the most noteworthy initiatives to make headway in this space. The OEWG report advocated for a set of "voluntary, non-binding norms" based on recommendations from member states. Critically, the report concluded that these norms would operate in conjunction with the states’ obligations under IL. This conclusion refutes the argument that these new norms would supplant a state's responsibilities under IL. However, the OEWG stated this conclusion more explicitly in the pre-draft report before tempering it in the final report. Nonetheless, the final report challenges two mutually reinforcing assumptions about the scope of IL's applicability in cyberspace. First, IL concepts can be applied to cyberspace only if opinio juris demonstrates their application, that is, states must believe they are obligated to apply IL concepts to cyberspace issues. Second, new cybersecurity norms render existing principles of IL inapplicable to cyberspace because cyberspace is a distinct area of IL. If we accept these two assumptions, then we effectively place cyberspace issues outside the reach of existing IL. However, an analysis of International Court of Justice (ICJ) opinions, International Law Commission (ILC) draft articles, and nations’ OEWG deliberations show that these assumptions are incorrect. Therefore, existing IL is the foundation for future developments in international cyberspace law, such as the new norms promulgated in the OEWG report. The assumption requiring Opinio Juris: The assumption that opinio juris is necessary rests on the premise that distinct spheres demand distinct state practices. Israel's Deputy Attorney General argued in support of this assumption that IL cannot be applied automatically from the physical to the cyber sphere. From a purely physical standpoint, he is correct; certain principles of IL are restricted to specific spheres. For example, the idea of freedom of navigation is restricted to ships operating on the high seas. However, he overlooked the fact that the cybersphere is not merely another physical sphere. This notion that IL will be applied differently in different areas originated in the law of armed conflict, where nations have varying commitments in various spheres. The primary argument for doubting IL's applicability in cyberspace is the assumption that cyberspace is a new frontier. This is incorrect, as cyberspace activities do not take place in a new sphere. Rather, what we commonly refer to as cyberspace is a collection of information and communication technologies that enable users to more efficiently exchange and process information, such as the internet. Moreover, while software, code, and data are significant components of these technologies, the components themselves require hardware and individuals who create and use software, hardware, and data. Thus, while cyberspace activities span borders, they are nonetheless rooted in physical infrastructure. In its Advisory Opinion on Nuclear Weapons, the ICJ rejected the contention that principles of IL and international humanitarian law do not apply to nuclear weapons because they are a new form of weaponry. Additionally, the ICJ noted that the principles of IL apply to all weapons, regardless of when they came into existence. Additionally, the ILC stated that every new technology is subject to existing principles of IL aimed at preventing transboundary harm. Further, the OEWG report underlined that the issue is technology misuse, not technology use, and that actions to avoid technology misuse should remain “technology-neutral.” The term technology-neutral means that existing principles must apply to new forms of technology, without simply refuting their application based on the “new form of technology” argument. This is not to say that no adjustments are necessary when extending IL principles to cyberspace; they may be required in some cases. What this does mean is that the starting point for IL in cyberspace is not limbo but rather established principles of IL. This becomes increasingly critical, as the Czech Republic recognized, because cyberspace use accelerates at a rate that treaty development cannot keep up with. The assumption that the new norms will replace the existing principles of IL: The 2015 Report of the Group of Governmental Experts on Developments in the Field of Information and Telecommunications in the Context of International Security (GGE), which the United Nations General Assembly subsequently adopted, urged the establishment of new norms of responsible state behavior in cyberspace. As indicated at the outset of this piece, the GGE intended for these new standards to be voluntary and non-binding. Thus, what is the relationship between these new standards and established IL principles? One of these new standards requires states to prevent their territory from being used for cyber operations that violate IL. However, this requirement already exists as a general principle of IL: due diligence. Is this to say that a fundamental principle of IL has been reduced to non-binding advice under the new norms? The proponents of this assumption may desire to suggest that states have opted to dilute some IL principles in cyberspace. However, during the OEWG deliberations, states made clear that the new norms do not replace or alter their existing obligations, but rather complement them (See here, here, here and here). Additionally, the OEWG report noted that the new standards do not supplant existing legal concepts, but rather complement them. In the case of established norms of IL, states have maintained that the long precedent of states enforcing these norms further validates their application to cyberspace. (See here, here and here). Conclusion: Existing principles of IL continue to govern the sphere of cyberspace. Accepted principles remain in force until states decide to change them. Thus, while new cyberspace-related norms and treaties are undoubtedly necessary, this need does not render existing obligations inapplicable. The OEWG's final report and states’ recommendations imply that the new norms complement current IL principles, whether they admit it or not.

About the authors: Priankita Das and Garima Khanna are fourth-year law students at Dr. Ram Manohar Lohiya National Law University, India. Image by K-putt available here: I. INTRODUCTION The unexplored bounds of outer space present many opportunities for ambitious and rapidly progressing space-faring nations and private entities to make their mark in outer space. However, the legal doctrine is still being developed and is not consistent with the transition from exploration to exploitation. This blog questions whether space-faring nations will ever successfully exploit resources in outer space and if they do, who gets to possess the legal ownership over them. The current Conventions are clouded by ambiguity on the issues of appropriation of resources extracted from the moon and other celestial bodies, but with ambitious non-governmental organizations laying down stepping stones for development in outer space, it is essential to clear the air pertaining to these complex matters. At a cursory glance, it may seem like these resources shall be acquired on a first-come-first-serve basis, but the consequence of that approach is deep-rooted in issues arising out of ignorance of basic customary international law. The most pressing concern is that the rights of developing nations might be overlooked, as their resources to reach outer space remain limited due to technological or economical incapability. An unequal allocation of resources may lead to territorial conflicts defeating the object and purpose of the Space Conventions for peaceful use of outer space. II. PRINCIPLE OF NON-APPROPRIATION IN SPACE LAW One of the most fundamental principles of the Treaty on Principles Governing the Activities of States in the Exploration and Use of Outer Space (hereinafter “Outer Space Treaty”) and the Agreement Governing the Activities of States on the Moon and Other Celestial Bodies (hereinafter “Moon Agreement”) is the principle of non-appropriation, which essentially means that no object can become the property of any state or citizen. This principle aims to guarantee peace among state parties and prevent any occurrences of private disputes arising out of proprietary rights over the lunar surface. Its purpose is not to prohibit the use of lunar resources, but rather to provide free access to all state parties on a non-discriminatory basis. This indicates that the drafters of the Outer Space Treaty acknowledge the perks of giving access to mankind for purposes of exploring the unexplored bounds of space and simultaneously were aware of the colossal harm that could be brought to extra-terrestrial matter present on celestial bodies. Both the Outer Space Treaty and the Moon Agreement have provisions enforcing this specific principle. The non-appropriation principle creates certain obstacles for private entities that seek to gain monetary profits out of moon mining; however, there do exist certain loopholes that can be used by private commercial entities in order to circumvent this principle without the violation of any provision of international or domestic law. III. RESTRICTION OF NATIONAL APPROPRIATION OF THE LUNAR RESOURCES The Outer Space Treaty [Article II] and Moon Agreement [Article 11(2)] state that the surface of the moon or any part thereof shall not be subject to ‘national appropriation’ by a claim of sovereignty, means of use and occupation, or by any other means. It is pertinent to note that the provisions only prohibit ‘national’ appropriation and are silent on the subject of appropriation by private entities. However, Article VI of the Outer Space Treaty categorically states that any activity conducted by a non-governmental entity in outer space shall come under the purview of the State’s jurisdiction and the State shall be responsible for the actions of the organization. Furthermore, Responsibility of States for Internationally Wrongful Acts also recognizes any person or entity as Organs of State under Article IV. Similarly, in 2004, the International Institute of Space Law (hereinafter “IISL”) stated that territorial claims, whether by a national or private entity, are prohibited by the Outer Space Treaty. The IISL drew this conclusion from Article VI of the Outer Space Treaty, which states that the responsibility of any and all activities, including activities by non-governmental entities, shall be of the State parties. Therefore, by an extension of this provision, the non-appropriation principle is binding upon private commercial players as well, and thus, they cannot appropriate the resources available on the lunar surface. IV. APPROPRIATION OF LUNAR RESOURCES ‘IN PLACE’ Despite the extended application of the non-appropriation principle on private entities, there exists another loophole in the Moon Agreement that may be utilized to circumvent the non-appropriation principle. Article 11(3) of the Moon Agreement states that no proprietary rights can be created over any natural resources ‘in place’ and that the placement of any structures, vehicles, or personnel over the surface of the moon shall not give rise to the right of ownership. Emphasis must be supplied to the term ‘in place’ or in situ, which implies that the prohibition on the creation of property resources is inapplicable to the resources which have been extracted from the surface of the moon. Any resources which are ‘out-of-place’, i.e., removed from the surface by the personnel or equipment, are not under the protection of the Moon Agreement or Outer Space Treaty. Therefore, if any mining company, whether private or governmental, intends to extract and take over the ownership of lunar resources, it would not be in violation of international space law. The United States of America has also based its domestic space mining legislation on this interpretation of the Conventions. Moreover, with the application of the nulla poena sine lege principle, i.e., one cannot be punished for doing something that is not prohibited by law, it implicitly allows private entities to appropriate resources available on the lunar surface. Thus, private commercial entities have a way out of compliance with the non-appropriation principle of the Outer Space Treaty and Moon Agreement. However, such allowance for private entities would defeat the very purpose of the Outer Space Treaty and the non-appropriation principle. V. CONCLUSION Despite the noble attempt of the Outer Space Treaty and Moon Agreement to proscribe the creation of proprietary rights in outer space, the drafters of the Conventions failed to take into account the loophole provided by the wording of Article 11(3) of the Moon Agreement that allows such creation over resources ‘in place’ or in situ. This loophole may allow private players and government entities to misuse the freedom allowed by international space law and go forward in placing private and sovereign claims over lunar resources to the detriment of other private and national entities. Such circumvention will result in the absolute defeat of the res communis principle, i.e., the common heritage of mankind, that is fundamental to international space law. Thus, it is recommended that State Members take note of this loophole at the earliest, and accordingly devise a solution that would eliminate the misuse of this provision.

About the author: Shantanu Singh is a third-year B.A. LL.B. (Hons.) student at Dharmashastra National Law University, Jabalpur. Photo available here. Recently, the International Criminal Court (ICC) decided to reopen a probe into potential war crimes committed in Afghanistan. The alleged perpetrators include not only terrorist groups - the Taliban and the Islamic State Khorasan (ISIS-K), but also the US Forces and its allies. However, the ICC’s ambit of investigation explicitly excludes the alleged crimes of the US and its allies, limiting the investigation to the actions of Taliban and ISIS-K. This decision has triggered criticism from human rights defenders who have questioned the moral standing of the court and described the exclusion of powerful states as extremely dangerous that feeds impunity for all. Against this backdrop, this article anatomizes the wider issue of persisting inequalities rooted in international criminal justice. It outlines the importance of the third world approaches to international law (TWAIL) in the context of international criminal law and exposes the Eurocentric and hegemonic foundations of international criminal justice. It attempts to accentuate how the institutions of international criminal law systematically perpetrate marginalization of the Global South to the benefit of the Global North. It offers a thorough inspection of the ideological and structural biases that exist in international criminal law from its inception and persist today. Eurocentrism and the Development of International Criminal Law One of the defining characteristics of the ICC is that it proclaims to exercise universal jurisdiction in its aim to prosecute, regardless of the place of commission and nationality of the suspect, “the most serious crimes of concern to the international community as a whole.” The concept of universality is based on observance of geopolitical egalitarianism and objectivity in the enforcement of international criminal law. However, from the TWAIL perspective, the pragmatic reality of this idealistic claim is highly contested. The exercise of universal jurisdiction is rather regarded as a reflection of power asymmetries in the international legal order. As history depicts, the European colonial powers used international law as an instrument to justify and legitimize the subjugation of the Third World in the hands of the European colonial powers. An essential feature of Europe’s colonial framework was incessant interference in the affairs of the Third World, rationalized based on the concept of “civilizing mission” i.e., by characterizing non-Europeans as “other” – primitive, barbarian and uncivilized – who must be civilized and developed. For instance, the British imperialist project to interfere in the native princely states of India was rationalized by calling them ‘semi-civilized’, “semi-sovereign” and “protected dependent states.” Consequently, the states that surrendered their sovereignty and became subsidiary to the British Raj were certified as “civilized states.” Similarly, during the Philippine-American War (1899-1913), Rudyard Kipling's “The White Man’s Burden” supported for the the US to join forces with British imperialism and share the “white man’s burden” of “extending civilization to peoples considered inca-pable of governing themselves.” From the TWAIL perspective, international criminal law has been a “distinctly Western venture” owing to a strong and unstated influence exercised by the colonial conceptions of the primitive and the barbarian. It is frequently the “other” who are perceived to be the source of all violence and who must consequently be subdued by even more intense violence. Nevertheless, violence administered by a colonial power is always legitimized by characterizing it as of humanitarian or self-defense nature. International criminal justice furthers the occidentalist narrative of them being the saviours of the “dark corners of the world” and of “teaching these darkies about the rule of law” by “imposing white man’s justice upon third world conflicts.” In the light of the Eurocentric foundations of international law, Anghie and Chimni argue that the purported universality in respect of international criminal law is demonstrated to result more so in selectivity than egalitarianism. The interpretive prism of TWAIL encompasses colonial and neo-colonial ordeals lived by the people of the Third World due to the colonial architecture of international law. The crystallization of international criminal law at Nuremberg was an exposition of global power politics, selectively covering the atrocities committed by Nazis while passing over Allies’ conduct as colonial powers. A similar and even more flagrant exposition transpired in the Tokyo Trial, where the Tribunal feared that allowing Japanese defendants to take a defense of tu quoque could enmesh Allies for their war crimes. In his 1,235-page dissent, Judge Radhabinod Pal held that all the defendants were innocent since the London Charter was an ex post facto law. Thus, both the Nuremberg and Tokyo trials are archetypes of victor’s justice wherein the tribunals were heavily dominated by the US influence. The establishment of country-specific ad hoc tribunals such as the International Criminal Tribunal for the former Yugoslavia (ICTY) and Rwanda (ICTR), and the Special Court of Sierra Leone (SCSL) exhibits a drive towards selective prosecution of weak regimes in the Third World. Despite concerted efforts to push for action on allegations against the British forces in Iraq, Canada’s treatment of Afghan detainees, or the alleged crimes of Western allies in Israel and Colombia, the ICC’s prosecutorial lens remains affixed on the Global South, particularly Africa. Problematizing (Post-) Colonial Continuities The ICC was established in 1998 with a promise to transform the international criminal justice project by addressing the downsides of ad hoc criminal tribunals. Numerous TWAIL Scholars, albeit critical of its certain aspects, expressed optimism for the ICC in light of its consensually negotiated statute, unlike its predecessors. Countries of the Global South ratified the Rome Statute for it promised an institution that appeared “genuinely egalitarian in structure and profoundly fair in conception.” Nevertheless, the structural and material design of modern international criminal law is still a replication of traditional exclusions. For instance, Article 17 of the Rome Statute is inherently imperialist as it reinforces the civilizing mission of the West and enables the ICC to conduct prosecution by deeming the legal systems of the Third World as ineffective and inappropriate. It is premised on the “existence and perpetuation of state failure and weakness” and is oblivious to the “culpability of Global North for the role of State failure.” This framework of fortifying legal hegemony of the Global North is strongly condemned by TWAIL scholarship for displaying (post-) colonial continuities that legitimize the creation of arbitrary grounds for unsolicited intervention in the Third World states. Furthermore, Article 98 grants de facto immunity to the Western powers from prosecution of the ICC as it allows two states to conclude a bilateral non-surrender agreement that impedes the ICC’s jurisdiction. These agreements have effectively created evasive routes for the Western powers to conclude several such agreements by issuing threats to withhold military or development aid. For instance, the US has concluded such agreements with over one hundred states, thereby preventing the appearance before the ICC of any US national. This lawlessness of the Western states effectively renders the ICC as an instrument in the hands of the Western powers to maintain their hegemonic status quo. The referral mechanism of the Security Council under Article 13(b) of the Rome Statute is another blatant portrayal of the ICC’s reluctance to dissociate itself from the imbalance of power of international criminal law in the favor of the West. The Security Council’s referral powers imperiously alter the principles of international law by allowing unsolicited intervention of the ICC over matters transpiring on the territory of a non-party state. For instance, the ICC exercised jurisdiction to indict Sudanese President Omar al-Bashir for alleged genocide in Darfur. The Security Council’s referral powers position even non-signatories of the Rome Statute (the US, China and Russia) to veto any referral of cases to the ICC, thus further entrenching the inferior treatment of the Third World by the international criminal law. The referral power of the Security Council is criticized for departing from the pacta tertiis rule embodied in Article 14 of the Vienna Convention on the Law of Treaties as per which a treaty does not create rights or obligations for a state without its consent. Apart from the ICC’s geographical selectivity, its “material selectivity” ensures that international criminal law is anything but universally applicable. The forms of violence criminalized at the design level are indicative of deeply rooted historical forms of inequality. International law’s approach to determining what constitutes the “most serious international crimes” has never been a neutral process. This is evident from historical patterns of opposition from Global North states to the inclusion of crimes such as apartheid, colonial domination, foreign intervention and severe environmental damage for fear that their nationals and corporations would be exposed to prosecution. TWAIL aims to re-conceptualize and redefine these boundaries of criminalization by creating an inclusive list that encompasses crimes of neocolonial character such as mercenarism, corruption, money-laundering, illicit exploitation of natural resources, etc. Conclusion From a TWAIL perspective, the ICC’s journey hitherto has been restricted by geographical and material selectivity to the detriment of the Third World for it continues the evil legacy of ad hoc tribunals by “imposing white man’s justice upon third world conflicts.” An expedition towards prosecution of all the perpetrators of war crimes in Afghanistan, and contemporary crimes of colonization in Palestine and Sri Lanka would provide the ICC with a meaningful opportunity to prove its emancipatory potential and legitimacy. The ICC ought to extricate modern international criminal law from the clutches of eurocentrism by navigating a more holistic approach to resolving conflicts, aimed at recognizing and understanding the very dynamics that originated the eruption of violence.

About the author: Rhia Mehta (LL.M Candidate, Class of 2022) is a contributor to Travaux. Introduction Global news outlets are rife with evidence of Russia committing atrocities in Bucha, Ukraine. Photo-journalism has reported the shooting of a man walking alongside his father, who in bearing witness to the murder of his son wished for the bullet to have aimed for him instead; the decaying body of a gunned grandmother, continuing to be protected by her dog; the body of an unidentified woman raped and lying naked in a potato cellar; and the body of a son lying on the sidewalk, shot while he sneaked out to get a loaf of bread from some neighbours. Ukrainian President Volodymyr Zelensky narrated these allegations in detail during the United Nations General Assembly’s (UNGA) emergency session on April 7, 2022, which led to the UN body voting in favor of Russia’s suspension from the United Nations Human Rights Council (UNHRC). The UNHRC was created in 2006 with the adoption of Resolution 60/251. The UNHRC has 47 members, serving for a period of 3 years, elected by the majority of the UNGA through direct and secret ballot. The UNHRC demands that “..with membership on the Council comes a responsibility to uphold high human rights standards.” Therefore, the UNGA is obligated, in the exercise of its electoral powers, to consider the candidate States’ involvement in the protection and upliftment of human rights. The Russian Federation was elected to the UNHRC on January 1, 2021, with the expiry of its term in 2023. However, on April 7, 2022 its term was cut short by a 93 members majority voting in favor of its ouster. Russia’s suspension was sought in compliance with Article 8 of Resolution 60/251, which allows for the suspension of a State’s right to membership of the UNHRC, by a two-thirds majority of the members present and voting when the concerned State “commits gross and systematic violations of human rights.” The United States’ envoy to the UN, Linda Thomas Greenfeild, made the case for its dismissal In anticipation of the vote, Ukrainian Ambassador Sergiy Kyslytsya implored the UNGA caucus to support the resolution, especially in the recent light of the massacre of hundreds of civilians in the Ukrainian town of Bucha. Emphasis was laid on the murder, torture, rape, kidnapping and robbery of “peaceful residents” by the “Russian Army”. Kyslytsya petitioned that a vote against the resolution would mean “pulling a trigger, and it means a red dot on the screen, red as the blood of the innocent lives lost.” Similarly, the US urged Russia’s suspension calling its participation in a body protecting human rights a “farce” in light of its recent brutalities. Russia’s Violation of International Law The allegations of Russia’s violation of international law are two-pronged. First, the crime of aggression, perpetuated by Russia’s wilful infringement of Ukraine’s territorial integrity. Second, Russia’s violation of the laws of armed conflict. Article 2.4 of the UN Charter requires that all Member States “refrain . . . from the threat or use of force against the territorial integrity or political independence of any state . . . ” The requirement to adhere to this rule by Member States is absolute, with only two exceptions specifically carved out. The first is when the Member State is acting in self-defense. Russia may purport to justify its invasion under Article 51 of the UN Charter, which provides that a Member State’s inherent right of individual self-defense shall not be impaired if it is under an armed attack by another State. However, this is not a claim Russia can sustain. Russia was not under an armed attack from Ukraine to have acted in self-defense. The second exception is when, under Chapter VII of the UN Charter, the United Nations Security Council (UNSC) authorizes the use of force. This was also not the case in the present scenario. Russia’s military intervention is further alleged to have violated the laws of armed conflict. These laws were confirmed through the adoption of the Geneva Conventions, requiring signatories to abide by established rules of conflict, essentially encompassing principles enshrined under international humanitarian law. Specifically, the law unyieldingly restricts Member States from targeting civilians during armed conflict. Not only is there an absolute prohibition on attacking a territory distinctly populated with civilians, but also on attacks aimed at territories where a clear distinction between the occupation of combatants and civilians cannot be easily identified. Attacks in violation of such prohibitions are recognized as war crimes. Legal Recourse Available to Ukraine Notably, Russia’s acts of aggression come in the face of the International Court of Justice’s (ICJ) order on provisional measures, dated March 16, 2022, in the matter of Ukraine v. Russian Federation (Allegations of Genocide under the Convention on the Prevention and Punishment of the Crime of Genocide). Russia did not participate in the oral proceedings. The proceedings were filed by Ukraine seeking the rightful interpretation of the Genocide Convention. Particularly, Ukraine sought to negate Russia’s allegations that Ukraine had authorized the genocide of Russians in the Ukrainian territories of Luhansk and Donetsk. And further that such alleged genocide by Ukraine triggered Russia’s right to take unilateral military action in Ukraine. In its order, the ICJ ruled in favor of Ukraine, inter alia directing that Russia immediately suspend all military operations that it commenced on February 24, 2022 on Ukrainian soil. Ukraine may also consider holding Russia accountable for its actions before the International Criminal Court (ICC). The ICC only has direct jurisdiction over States that have acceded to the Rome Statute, which is the statute of the Court. The ICC therefore cannot exercise direct jurisdiction over Russia, but it can exercise its jurisdiction over the crimes Russia has committed within Ukrainian territory. Since Ukraine has accepted the ICC’s jurisdiction, the Court can direct investigation into the crimes committed on its land. Further, it is notable that the ICC holds jurisdiction over individuals and does not specifically focus on the States. As such, Ukraine may consider arraying the Russian President Vladimir Putin as a party-Defendant. Effectively, to hold Putin directly responsible, the ICC will have to test his role in the Russian invasion against the concept of ‘command responsibility’, which requires assessing whether or not the alleged individual, whether in his military or civilian capacity, exercised effective control over the acts alleged in conflict, even though he may not have been the one directly committing the acts. Conclusion Despite such prosecutions, the fact remains that the UN bodies, both the ICJ and ICC do not have much power to enforce the execution of their orders. As such, the enforcement of any verdict against Russia and/or Putin will have to be achieved through the powerful harmonious culmination of global political powers, all collectively fighting the war against human brutalities, just as they did in suspending Russia from the UNHRC. It will take the sacrifice of personal political agendas and of favorable diplomatic relations for a unanimous global political will to ensure culpability and the prevalence of justice.

About the author: Lin Wei (LL.M Candidate, Class of 2022) is a contributor to Travaux. Her interests focus on international trade and international commercial arbitration. Lin holds an LL.B. degree from the Southwest University of Political Science and Law and is pursuing a master’s degree in international law from the East China University of Political Science and Law. She is a native speaker of Mandarin. "Who really pays for all this CO2? Understanding the incidence of carbon taxation in the EU" available here. Introduction On July 14, 2021, the European Commission adopted and published a proposal for a Carbon Border Adjustment Mechanism (CBAM), which some media reports refer to as a “carbon border tax.” The EU Commission claims CBAM will be a “global solution” that solves climate change as a “global problem.” It will impose a carbon price on selective imports. CBAM aims to minimize “carbon leakage” from the EU to countries with less emissions constraints by aligning the carbon price to be paid on imports into the EU with the price paid under the EU’s Emission Trading System (ETS) for carbon emissions produced within the EU. The EU has committed to become the first climate-neutral continent by 2050. The CBAM proposal forms part of its target of reducing carbon emissions 55% by 2030. The EU shows courage in introducing this climate policy employing trade measures that has not yet been tried elsewhere. However, there are concerns about the potentially trade-restrictive effects of this legislation and its compliance with WTO rules. Context: the 2015 Paris Agreement and “Carbon Leakage” The 2015 Paris Agreement leaves contracting parties to choose their own level of climate goals as nationally-determined contributions (NDCs) that reflect their “highest possible ambition,” and “common but differentiated responsibilities and respective capabilities, in the light of different national circumstances.” This has resulted in asymmetric climate mitigation policies among different countries. Moreover, the Paris Agreement does not provide any enforcement mechanism that would ensure states keep their commitments. As a result, industries might relocate their power plants, factories, or other heavily polluting facilities to countries with less stringent emission constraints when the EU ETS or other similar carbon pricing rules raise their costs, which could increase their total emissions. To ensure that this trend of “carbon leakage” does not undermine the EU's climate objectives and drive away foreign investments (not explicitly claimed by the EU), the EU introduced CBAM. As discussed previously, CBAM is a unilateral measure that charges certain products imported from non-EU countries on the basis of their carbon emissions in the production process. It requires importers to buy carbon certificates corresponding to the carbon price that would have been paid had the goods been produced under the EU's carbon pricing rules. The price of the certificates will be calculated depending on the weekly average auction price of EU ETS allowances expressed in € / ton of CO2 emitted. However, certain third countries who participate in the ETS or have an emission trading system linked to the EU's will be excluded from the mechanism. These include members of the European Economic Area and Switzerland. The EU will revisit the exemptions in 2030 when the “trading partners should have put in place the decarboni[z]ation measures they have committed to, and an emissions trading system equivalent to the EU's.” Debates under WTO Rules: Discriminatory Trade Restriction? The EU stated that it has considered and ensured CBAM's WTO compatibility during the drafting stage but without any detailed legal analysis. As a response, some countries like Canada and the US are considering similar proposals. However, BASIC countries (Brazil, South Africa, India, and China) have expressed “grave concerns” regarding the usage of unilateral carbon border adjustment. It argues that these trade barriers are discriminatory and violate the principles of Equity and the UN principle of common but differentiated responsibilities and respective capabilities (CBDR-RC). To analyze the legal compliance of CBAM, the first step is categorizing it under the General Agreement on Tariffs and Trade (GATT). There are debates on whether the charge imposed via CBAM falls within the concept of “ordinary customs duties” and “other duties or charges” under GATT Article II:1. It provides that a member is bound to impose a certain maximum of tariffs and is barred from charging a value in excess of ordinary custom duties or any other fees mentioned in its schedule of concessions. CBAM charges on imported goods, but on the basis of these items’ Processes or Production Methods (PPMs) instead of value or volume. These fees may not constitute ordinary duties, but can still be designated as “other duties or charges.” With regards to the non-discriminatory principle under the GATT, the Most Favored Nation (MFN) clause requires the contracting parties to grant the same advantages, favors, privileges, and immunities to all like products originating in or destined for the territories of all other contracting parties (non-discrimination amongst foreign products), and the National Treatment (NT) clause requires contracting parties provide national treatment on internal taxation and regulation to imports from other contracting parties (non-discrimination against foreign products). It is possible that CBAM could violate the MFN principle if it exempts imports from certain countries with equivalent carbon pricing systems. It could also violate the NT rule because imported goods do not benefit from the same free allowance that is granted to local producers. The last core question is whether discrimination either against MFN or NT obligations can be justified under GATT Article XX as a general exception. Articles XX(b) and (g) are the exceptions relevant to the climate issue. Article XX(b) deals with such measures as may be “necessary for the protection of life or health of humans, animals or plants”; Article XX(g) provides measures “relating to the conservation of exhaustible natural resources if such measures are made effective in conjunction with restrictions on domestic production or consumption”. Even if CBAM qualifies Article XX(b) or (g), it still needs to pass the chapeau test and prove that it is not an arbitrary or unjustifiable measure or a disguised restriction on international trade. There has been only one instance in which a country’s measure has met all of the tests necessary to qualify for an Article XX general exception defense. Conclusion When international cooperation on climate protection lacks efficiency and effectiveness, unilateral measures such as CBAM can inspire other states to adopt carbon emission restriction regulations. Meanwhile, according to the report published by the United Nations Conference on Trade and Development (UNCTAD) on CBAM’s potential effects, the EU might need to consider the trade impacts of its new climate change mechanism, especially in developing countries. Furthermore, the compliance issue of CBAM also indicates the need for a reevaluation of the WTO rules before it’s too late to deal with climate change.

About the authors: Ahan Gadkari serves as a Research Assistant to Dr. Aniruddha Rajput, Member, UN International Law Commission. He has previously served as an intern at the Centre for Trade and Investment Law, Government of India. Tushar Rajput serves as an intern at the Centre for Trade and Investment Law, Government of India. "Russian Bear 'H' Aircraft" by Defence Images, available here. On February 24, the Russian Federation initiated a “special military operation” in Ukraine. This was a transparent violation of the prohibition on the use of force codified by Article 2(4) of the United Nations (UN) Charter. Further, it was also inconsistent with Clause 1 and 2 of the Budapest Memorandum on Security Assurances. Vladimir Putin ordered the operation shortly after delivering a fiery speech outlining his intentions to invade Ukraine, and offering a justification for the use of force. (English Translation: here). First, Putin argued, his use of force is an intervention via invitation (IVI) for collective self-defense under Article 51 of the UN Charter within the so-called “Donetsk People’s Republic” and the “Luhansk People’s Republic.” Second, it is to end a genocide he claimed Ukraine has been perpetrating against ethnic Russians. This second justification seems to be invoking the responsibility to protect (R2P), a principle that Russia has historically denied. The purpose of this piece is to provide legal analysis of the assertions made by the Russian President and to explain why they are inconsistent with international law. Every rule in international law is subject to exceptions. The exceptions to Article 2(4) of the UN Charter and the controversial R2P doctrine have specific criteria that must be fulfilled before they can be invoked. Intervention Via Invitation: IVI and collective self-defense are sometimes seen as two independent exceptions to the prohibition of the use of force, and hence as two distinct reasons for governments to legitimately employ force. However, the two doctrines are substantially similar, since both deal with situations in which a state invites/requests the aid of another state’s military. The rationale of the concept is that the prohibition on the use of force only covers the use of force without consent. The International Court of Justice (ICJ) codified IVI as a concept within international law in the Nicaragua case. However, the ICJ also stated that the concept of non-intervention would lose its legal efficacy if the intervention were justified only based on a request for help made by an opposition organization in another State. Indeed, it is difficult to see how the principle of non-intervention would survive in international law if intervention were permitted at the opposition’s request. This would allow any state to interfere at any time in another State’s internal affairs, whether at the request of the administration or the opposition. The ICJ further stated that such an interpretation is not consistent with the present position of international law (para. 246). Applying this principle here, the legalizing effect of consent by “Donetsk People’s Republic” and the “Luhansk People’s Republic” must be questioned. Especially since the situation is such that the consenting government is not legitimate and not recognised by any State other than Russia. Therefore, the Russian defense of IVI is baseless. Defense of Responsibility to Protect: It is essential to reiterate that Russia has historically denied the use of R2P as a valid exception to the prohibition on the use of force. Further, in his speech, the Russian President criticized the use of force by the North Atlantic Treaty Organization (NATO) in various instances. The Russian President stated: “Then came the turn of Iraq, Libya, Syria. The illegitimate use of military force against Libya, the perversion of all decisions of the UN Security Council on the Libyan issue led to the complete destruction of the state, to the emergence of a huge hotbed of international terrorism, to the fact that the country plunged into a humanitarian catastrophe that has not stopped for many years. civil war. The tragedy, which doomed hundreds of thousands, millions of people not only in Libya, but throughout this region, gave rise to a massive migration exodus from North Africa and the Middle East to Europe. A similar fate was prepared for Syria. The fighting of the Western coalition on the territory of this country without the consent of the Syrian government and the sanction of the UN Security Council is nothing but aggression, intervention. However, a special place in this series is occupied, of course, by the invasion of Iraq, also without any legal grounds. As a pretext, they chose reliable information allegedly available to the United States about the presence of weapons of mass destruction in Iraq. As proof of this, publicly, in front of the eyes of the whole world, the US Secretary of State shook some kind of test tube with white powder, assuring everyone that this is the chemical weapon being developed in Iraq. And then it turned out that all this was a hoax, a bluff: there are no chemical weapons in Iraq. Unbelievable, surprising, but the fact remains. There were lies at the highest state level and from the high rostrum of the UN. And as a result: huge casualties, destruction, an incredible surge of terrorism.” The Russian President is criticizing the NATO countries for using R2P as a part of his justification for its use by Russia in this instance. This argument seems extremely hypocritical and lacks consistency. Turning to the so-called “genocide” against the people of Donetsk and Luhansk by Ukraine and granting statehood. In declaring a genocide, Russia has lowered the standard of agreession required for remedial secession. This contrasts with Russia’s assertion that Kosovo did not meet the threshold for ceding from Serbia even after the International Criminal Tribunal for the former Yugoslavia (ICTY) documented the mass atrocities faced by the Kosovar Albanians. The crime of genocide has an important nexus requirement. The abilities of domestic courts and the responsibility of states are subject to legal action taken; however, even before dwelling into these concrete steps, implications in international relations are to be addressed. President Putin has asserted that there is a ‘genocide’ being conducted by Ukraine, and circulated a document to the UN Security Council accusing Ukraine of exterminating the civilian population. Russia’s actions raise questions as to whether a moral right of humanitarian intervention is converted into a right under international law in the event of attempted genocide. Further, it is important to consider the objective standards that determine the threshold of damage before intervention is acceptable. The invocation of genocide represents more than just a shallow casus belli. Genocide entails an aggravated regime of state responsibility. It is a composite crime and consists of acts which are themselves punishable by most existing legislations. The Convention on Preventing and Punishment of the Crime of Genocide (convention) defines acts amounting to genocide and enumerates material offences with necessary mental elements. Extermination, as described in Prosecutor v. Radislav Krstic in the ICTY (para. 492-505), is understood as actions that are subordinated with an intent to destroy or cripple a human group permanently (also see statements made by Sir Hartley Shawcross and Sir David Maxwell Fyfe here.) The convention differentiates between ‘attempt’ and ‘partial act,’ as has previously been upheld by the International Criminal Tribunal for Rwanda in Prosecutor v. Laurent Semanza (para. 316). In the crime of attempted genocide, an entity does not realise its intent, whereas, in a crime of genocide, the acts are attributed to a state to establish the intent. Russia furthers its intervention on the lines of the attempt of genocide, thus shall never meet the standards of intent required to act against Ukraine. Further, the International Law Commission has also held that such an irrational understanding of international standards is inconsistent with international law (page 44). Genocide requires neither many victims nor their deaths, rather a systemic deprivation of identity and acts of inhumanity. Since the Russian annexation of Crimea and subsequent conflicts, this burden of proof against Ukraine has not been met. Such proliferation of the convention and existing principles of international law indicates genocide’s politicisation. The claimed atrocities against the people of Donetsk and Luhansk by Ukraine, even if we assume the Russian President’s assertions to be accurate, the acts would qualify as crimes against humanity, the separate codifications – one in international treaty and other in international custom, does not call for the same response from a State and it will still not be construed to be a genocide. Concluding Remarks Thus, the justifications provided by the Russian President regarding IVI and R2P do not meet the criteria necessary to be valid exceptions to the prohibition on the use of force. The actions by Russia appear to be founded in the warped Russian assertion of the world being dominated by a hostile west, leaving them to be the sole protectors of the people of Russia and Ukraine. Russia never accepted the right of Kosovo for self-determination or remedial cessation on the basis of genocide. However, Russia wants to use the same argument when it favors its policy. Russia’s invasion of Ukraine is neither justified under IVI or R2P nor does it meet their own interpretation of international law in the past.

Xiangyu Ma (LL.M. ’22) is a Contributor to Travaux. Prior to joining Berkeley Law, he obtained his LL.B. degree from Wuhan University in China. Previously, he had interned with public and private stakeholders across different legal sectors such as PE, bankruptcy, dispute resolution, and infrastructure construction. He is particularly interested in the topics of public law, international law, and comparative law. The Hong Kong Court of Final Appeal, available here. On March 30, 2022, Lord Reed, President of the United Kingdom Supreme Court, said that two British non-permanent judges of the Hong Kong Court of Final Appeal (CFA), the highest court in Hong Kong, would resign from their posts on the grounds that the Hong Kong administration had "departed from the values of political freedom, and freedom of expression.” Since the promulgation of the Hong Kong National Security Law, four foreign judges have left Hong Kong’s highest court. Chief Justice Andrew Cheung Kui-Nung regretted the resignations of two non-permanent foreign judges and stated that the judiciary’s commitment to upholding the rule of law and judicial independence is wholly unaffected. In the meantime, nine out of 10 remaining non-permanent foreign judges of the CFA confirmed they would stay. Beverley McLachlin, former Chief Justice of the Supreme Court of Canada, explained her reason for staying on: “the court is…perhaps the last surviving, strong institution of democracy.” Hong Kong has a long tradition of recruiting foreign judges since its 1997 handover. Article 92 of the Hong Kong Basic Law stipulates that “[j]udges…may be recruited from other jurisdictions.” Article 82 also reads that inviting judges from “other common law jurisdictions to sit on the Court of Final Appeal” is permissible. However, the employment of foreign judges in domestic courts, or even the mere citation of foreign law or international treaties in judgments, appears controversial – in the United States, Supreme Court Justice Antonin Scalia, in Roper v. Simmons, held in his dissenting opinion that he “do[es] not believe that approval by ‘other nations and peoples’ should buttress our commitment to American principles” and “the only legitimate function of this Court is to identify a moral consensus of the American people.” Despite the skepticism, having foreign faces sitting on the bench is a global phenomenon that we can see in Fiji, Kiribati, Nauru, Papua New Guinea, Samoa, Solomon Islands, Tonga, Tuvalu, Vanuatu, and many other jurisdictions. This article will examine the pros and cons of this phenomenon and explain why foreign judges are leaving Hong Kong. Legitimizing and De-Legitimizing Foreign Judges in Domestic Courts Most countries in the world expressly require judges to be citizens. However, more than 30 countries have foreign judges serving on their highest or constitutional courts. The reason for rejecting foreign judges is simple—different countries have their own laws, and foreign judges often lack the local legal knowledge to serve in a different state. Further, the court, as a branch of the government, needs to maintain a certain level of political sensitivity to avoid undermining its own legitimacy, especially in adjudicating interbranch disputes – for example, the US Supreme Court developed the Political Question Doctrine in Baker v. Carr to set the boundaries of its own adjudication. However, the role of the judiciary in the political sphere varies from country to country. In Germany, because of a history of Nazis gaining power through democratic procedures, the German Federal Constitutional Court is vested with broader power of judicial review than the US Supreme Court to draw constitutional boundaries on the operation of public powers. For example, it can declare a statute unconstitutional even without a case before the court. That said, foreign judges may not fully understand the local political context when delivering judgments on those highly political or interbranch cases. Additionally, foreign judges’ appearance in domestic courts may stir up strong nationalist sentiments. For instance, Republika Srpska, the Serb-majority substate of Bosnia and Herzegovina (BiH), claimed in 2020 that it would suspend its participation in BiH state institutions until foreign judges are expelled from BiH’s Constitutional Court. This followed a decision by the Court determining that Republika Srpska’s public land law was unconstitutional. Nonetheless, there are also many justifications for having foreign judges in domestic courts. First, judges from jurisdictions with a high degree of the rule of law can boost the international prestige of newly established courts, thereby attracting much-needed foreign investment into the country. Hong Kong fits such a scenario: in 1983, Hong Kong experienced a stock disaster when China and the UK reached a deadlock in negotiating the transfer of sovereignty over the island. One of the reasons for the market panic was that the Judicial Committee of the Privy Council’s status as the highest appellate court in Hong Kong would be replaced by the Chinese judiciary or legislature after the Handover. Therefore, the Chinese government made concessions and agreed to vest the power of final judgment in Hong Kong’s courts and invite judges from other common law jurisdictions to participate in the court hearings. These legal commitments by the Chinese government then became parts of the Sino-British Joint Declaration and were finally written into the Hong Kong Basic Law. Second, in some post-conflict countries, foreign judges are often seen as impartial outsiders who maintain distance from local political groups. As a result, they can empower courts in post-conflict nation-building processes by adjudicating cases as a neutral, apolitical third party. In BiH, a country with serious ethnonational divisions in the past, domestic judges are often suspected of being significantly influenced by their ethnonational affiliations in judicial decision-making. Foreign judges face less appearance of bias. Third, some post-colonial and post-authoritarian countries lack qualified local professionals in the judiciary either because of their colonizers’ negligence of judicial localization or authoritarian regimes’ natural tendency to undermine the importance of the legal profession. For example, Hong Kong did not start its own legal education until the establishment of the Faculty of Law of the University of Hong Kong in 1969. Most of the legal professionals before the Handover were trained overseas, which could not be afforded by many local people. This is also the case in many small Caribbean and Pacific states. As a result, foreign judges are needed in these countries during their transitional periods. Hong Kong’s Foreign Judges in Changing Times Foreign judges have played an important role in the continued prosperity of Hong Kong after 1997. Since the Handover, Hong Kong has maintained a high-level rule of law jurisdiction worldwide, and Hong Kong judgments are cited from time to time overseas. However, the role of foreign judges in Hong Kong has become increasingly controversial as several factors have changed over the years. First, Hong Kong is not as economically important to mainland China as it was at the time of the Handover. In 1997, China was experiencing rapid economic growth after the implementation of its “Reform and Opening-up” policies and sought membership in the World Trade Organization. Hong Kong, an international financial center, was crucial to China’s market reforms. This is the key reason for China’s “one country, two systems” policy, of which expatriate judges are a part. As China became the world’s second-largest economy, its support for this economically rational arrangement waned. Additionally, the economic integration of mainland China and Hong Kong incentivizes Beijing to gradually assimilate the legal system of Hong Kong, especially with other regions of the Great Bay Area, a mega-region that comprises the cities of Guangdong province, Hong Kong, and Macau. Second, and more importantly, the legitimacy of the Hong Kong judiciary has declined in Beijing’s eyes in recent years. In democracies, the judiciary has always faced a democratic legitimacy dilemma because of counter-majoritarian difficulty. However, in Hong Kong, public trust towards the impartiality of the judiciary is often higher than public support of the Chief Executive and the Legislative Councillors. The real legitimacy problem the Hong Kong judiciary has to deal with is its legitimacy in the perception of the Chinese government, given the latter has “predominant political power” over Hong Kong. Some high-profile Chinese scholars have increasingly described the phenomenon of foreign judges in Hong Kong as the “loss of Chinese judicial sovereignty” and argue that the Hong Kong judiciary must be decolonized. Additionally, during the 2014 Umbrella Movement and the 2019 Anti-Extradition Bill Protests, some foreign judges sitting in Hong Kong’s lower courts were tagged by Chinese state media as people “who released the protestors caught by the police.” Therefore, in 2021, Beijing started to reiterate that the principle of “Patriots Governing Hong Kong” is fundamental to “One Country, Two Systems” and applies to judges at all levels. This will make the situation of foreign judges in Hong Kong even more delicate as their home countries are not China. Third, the enactment of the Hong Kong National Security Law also places foreign judges in an ethical dilemma. Macau, the other “Special Administrative Region” of China, amended its Law of Judicial Organization in February 2019. Pursuant to Article 19-A of this law, judges hearing cases involving national security crimes must be selected from a pool of candidates who are Chinese citizens. On the contrary, the Hong Kong National Security Law does not impose nationality restrictions on judges who hear such cases. As a result, foreign judges in Hong Kong may be selected to sit on national security cases and subsequently face ethical dilemmas because adjudicating these cases may be perceived as legitimizing the diminishing of freedoms in this city. Conclusion The imposition of the Hong Kong National Security Law has already caused a brain drain in Hong Kong, and the newest COVID outbreak has exacerbated the situation—as of March 18, more than one million people out of the city’s seven million citizens have tested positive. Strict quarantine measures have led nearly 50% of European companies planning to relocate staff. Hong Kong’s status as Asia’s financial center may be experiencing its most precarious moment since the Handover. Hong Kong’s past success was built on the rule of law, in which foreign judges played an irreplaceable role. If Hong Kong wants to continue to prosper as a vibrant city, more efforts should be made to ensure foreign judges stay on their posts during these challenging times, rather than letting nationalists cheer their departure.

About the author: Angela Chen (J.D. Candidate, Class of 2024) is a Contributor to Travaux. Her interests center on critical, deconstructive, and decolonial approaches to international law and international relations theories. Angela holds B.A. degrees in Political Science and Philosophy from the University of Chicago, and an M.Sc. degree in International Relations from the London School of Economics and Political Science (LSE). She is a native speaker of Mandarin and proficient in French. Photo available here. Introduction One of the most notable initiatives of Chinese President Xi Jinping’s tenure is the “Belt and Road” Initiative (BRI), comprised of the “Silk Road Economic Belt” as well as the “21st Century Maritime Silk Road,” connecting China to countries in Southeast Asia, South Asia, Central Asia, the Middle East and North Africa, and, ultimately, Eastern and Western Europe. Although it has yet to take the shape of a comprehensive blueprint, BRI has instigated suspicion and anxiety in the West regarding the intention of the Chinese leadership in proposing such an ambitious infrastructural framework: is China seeking to overturn the existing liberal international order by constructing a viable alternative? Or does China merely wish to expand its strategic space and sphere of influence while adhering to the existing international realities? While it is difficult to gauge the actual intentions of great powers, this article attempts to take a small step at elucidating these problems by examining the key objectives of BRI. Particularly, this article focuses on the discursive and ideational dimensions of BRI, which would throw light on the opportunities and challenges posed by BRI to international law and institutions. The world’s first encounter with BRI took place months after Xi came into office, articulated in his speech during a visit to Kazakhstan in September 2013. Proclaiming that countries with different cultures and histories could all partake in one common scheme of “peace and development,” Xi asserted that the ancient Silk Road had taken on “new vitality” with the development of China’s relations with Asian and European countries, as China sought to work with Eurasian states to advance the “happiness and well-being” of all people in their shared region. The concept of BRI, or its previous moniker of “One Belt, One Road” (OBOR), recurred during Xi’s visit to Indonesia in October 2013 and Premier Li Keqiang’s state visits in Asia and Europe in 2014. Nostalgic connections were drawn between the ancient Silk Road and BRI, harkening back to the Tang Dynasty, when China was the Middle Kingdom: the center of the ancient East Asian tributary system and the world at large. If ultimately successful, BRI will connect over 60 countries along the ancient Silk Road from the Asia-Pacific to Europe through infrastructure projects, economic linkages, and people-to-people interactions. In “Vision and Actions on Jointly Building Silk Road Economic Belt and 21st Century Maritime Silk Road” (“Vision and Actions”), Chinese leadership laid out the basic priorities of BRI: policy coordination, facilities connectivity, unimpeded trade, financial integration, and a people-to-people bond. Taken together, these five priorities aim to foster connectivity between China and the rest of Eurasia through constructing a large, unified market. The Geoeconomics and Geopolitics of BRI In recent years, China has encountered economic bottlenecks that have given rise to the “new normal,” an era of slower economic growth. Structural transformations in China’s economic model became necessary: from an export-led economy to one more driven by domestic consumption. The exigency of a new economic model translates into the need to access resources and markets. In addition to securing access to vital supplies, BRI attracts trade and business opportunities for Chinese state-owned enterprises (SOEs), thereby solving the overcapacity problem of the Chinese economy. As such, BRI seeks to tap market potential, promote investment and consumption, and stimulate job creation. Countries involved in BRI could absorb China’s excess industrial capacity, materials, and labor. They would also diversify China’s financial surplus, help increase capitalization, and control domestic investment. China would also be able to revitalize exports as a growth engine for its economy, which would ease the process of structural economic change. BRI projects enable Chinese firms to seek investment projects abroad, which would allow Chinese firms to become more competitive internationally. BRI projects would also permit Chinese leadership to test the ability of SOEs to meet its call for developing themselves to become internationally competitive, and could give large SOEs access to capital from state banks. The use of the Chinese currency, the Renminbi, would also be developed in international markets, which could lay the ground for its potential future elevation to a reserve currency. Geopolitically, BRI is seen as a pushback against the United States’s presence in the Asia-Pacific. BRI is to some extent a reaction against then-President Barack Obama’s 2012 “Pivot to Asia” strategy, which called for the deepening of American presence in East Asia. BRI also builds upon and has expanded existing inter-state cooperation in both economic and security realms under the Shanghai Cooperation Organization (SCO) and among BRICS (a coalition of five rapidly emerging economic powerhouses: Brazil, Russia, India, China, and South Africa) members, which would have countered the US-led Trans-Pacific Partnership (TPP) before it was scuttled by then-President Donald Trump in 2017. The Asian Infrastructure Investment Bank (AIIB), as well as BRICS’s New Development Bank (NBD) fund BRI projects and mark a turn away from Western-dominated financial institutions such as the International Monetary Fund (IMF). As such, BRI signals a milestone in China’s multilateralization strategy, and might to some extent foreshadow the construction of parallel institutions vis-à-vis the US-led liberal international order. Telling the China Story: BRI as Narrative As Xi asserts, BRI strengthens the “people-to-people” bond among partner countries, culminating in a “community of common destiny” and a “shared future of mankind.” Despite their lofty-sounding tone, such phrasings indicate that BRI attempts to reshape international political discourse, enabling China to frame itself in a positive light to a global audience. Indeed, BRI seeks to mitigate the anxiety of China’s neighbors regarding China’s rise through presenting a desirable image of a “win-win” for all countries that cultivate extensive business ties with Beijing The largely transactional nature of BRI’s economic focus is then layered with an almost teleological connotation, illustrated by wordings such as “common destiny.” The framework of relationalism would inform the ways in which BRI attempts to transform the power configurations of international relations. Relationalism posits transactional interactions between states as the foundation of their interactions. As such, the shape that interstate relations take is the result of processes. Dominant states gain influence through the establishment and maintenance of dense ties, which could induce interest alignment in smaller secondary states, enabling the dominant state to exert influence over secondary states’ domestic and foreign policies. Through this lens, BRI serves as an “influence multiplier” for China, which could reconstitute regional states’ development priorities, interests, and relations in ways that benefit China’s strategic interests. In a similar vein, BRI’s policy emphasis on integration and coordination aims to facilitate policy alignment, boosting China’s influence over partner countries. The push for integration is especially salient with respect to threat perception, security cooperation, and joint training at bilateral and multilateral levels. The influence-multiplying effect of BRI might paint a picture in which partner countries are lacking in agency, and their actions are thus molded and shaped by Chinese initiatives. On the contrary, the two-way nature of agency means that China is also actively seeking to offer a coherent narrative to persuade and lure its partner countries. Indeed, as China’s assertive foreign policy posture has raised suspicion among its neighbors, China seeks to ameliorate its neighbors’ anxiety and prevent any acts of balancing on the part of its neighbors. Propounding that BRI is “China’s greatest gift to mankind,” Xi posits that the “Asian-style” integration that BRI attempts to facilitate is different from the “European-style” integration as exemplified by the European Union (EU). The former shows a greater extent of sensitivity to national sovereignty, which would be appealing to countries involved in BRI, many of which guard their hard-won sovereignty. The stress on commonality and a shared regional vision represents the “hunt for a common Chinese language.” Indeed, working with countries whose political systems and international visions are disparate from China’s own requires a convincing and inclusive story. Phrases like “win-win” constitute the elements of this story, while the telling of this story is also facilitated by “people-to-people bond,” as well as inter-cultural exchanges, which seek to promote mutual political trust and understanding. By espousing the construction of a “community of common destiny,” China implies that it has a unique role to play in the development of “political civilization” writ large. The way BRI is sold to participating countries attempts to give China a discursive advantage over other major powers, such as the US, by emphasizing common development over power politics. For instance, the “Silk Road Spirit” underpinning BRI is sold as symbolizing “peace and cooperation, openness and inclusiveness, mutual learning and mutual benefit,” which China hopes will draw a stark contrast with what it believes is an exclusive alliance system of the US and its allies. Although there has yet to be any evidence that BRI has indeed altered the geopolitical realities in Asia, its espousal of alternative political norms—such as “a new type of network diplomacy”—might signal its potential to shift the discourse of international relations. As such, delving into the ideational dimension of BRI might allow us to gauge the kind of normative great power China seeks to become, which would have significant implications on the state of international law and institutions. Conclusion Now one might ask, how has BRI been received in China’s partner countries? Its reception has been mixed, with anti-BRI sentiment on the rise in some countries. The lack of transparency of BRI projects, the unsustainability of partner countries’ debt loads, the influx of Chinese labor which has overcrowded local job markets in target countries, as well as the resultant corruption and environmental damage in target countries, have raised domestic and international concerns. Although the non-conditionality approach of BRI was its earliest selling point, the absence of democratic oversight and accountability has instigated doubt regarding its long-term sustainability and feasibility. Therefore, while examining the key priorities of BRI from the vantage point of the Chinese leadership could shed some light on China’s intentions and the implications for the international order, devoting more attention to the limitations and setbacks BRI has encountered in its partner countries may open up further insight into this matter.

About the Author: Nirmalya Chaudhuri is a law student at the West Bengal National University of Juridical Sciences, India. "Beans preapared" by Nestlé available here. On June 17, 2021, the United States (US) Supreme Court dismissed a suit against Nestle USA Inc. (Nestle) and Cargill Inc. (Cargill) alleging that these companies had aided and abetted child slavery in cocoa farms in Ivory Coast. Although the farms were operated by third parties, Nestle and Cargill pumped substantial technical and financial resources into the farms’ operations. The entire case revolved around the extraterritorial application of the much debated Alien Tort Statute (ATS), which gives US district courts jurisdiction over claims brought by foreigners for torts committed in violation of international law. The Court based its decision on the premise that invoking ATS in this case would amount to extraterritorial application of the law. This is because the companies concerned carried out only “general corporate activity” in the US, a standard that is insufficient to draw a link with the alleged activities in Ivory Coast. By focusing on whether applying the ATS was an extraterritorial application of the law, the Court avoided analyzing whether corporations can be held liable for their actions under international law. For decades, US Courts have consistently argued that corporations are immune to international law, supporting their argument by reference to the Nuremberg Trials. However, this argument flows from a myopic misreading and misinterpretation of history. At the end of the Second World War, the International Military Tribunal at Nuremberg faced the issue of whether to charge certain German corporations, like IG Farben, for supporting the Nazi war effort. Although the Tribunal declined to hear claims against IG Farben, it did not do so because it found that IG Farben had not violated international law. While US Courts have continued to invoke the Nuremberg Trials as support for corporate immunity, various jurisdictions in Europe have adopted legal regimes that impose extraterritorial liability on corporations. Efforts like France’s “veil piercing” legislation are a welcome change. THE GHOST OF FARBEN: DEBUNKING THE MYTH OF CORPORATE IMMUNITY IN INTERNATIONAL LAW In 2002, the Ninth Circuit Court of Appeals broke the mold, holding that natural gas company Unocal could be liable under the ATS for assisting the Myanmar military in subjecting villagers to forced labor. This progressive legal proposition could have served as a signal that corporate impunity was not allowed under international law. However, in the 2010 Kiobel v. Royal Dutch Petroleum Co. opinion, the Second Circuit held that corporate liability was not customary international law (CIL) because corporations have never been tried for violating international law in the history of international criminal tribunals. Eight years later, the US Supreme Court applied this same rationale in Jesner v. Arab Bank. While corporations themselves have never been prosecuted for criminal conduct, analyzing historical context shows that mere precedent should not absolve them from liability. The Nuremberg Tribunal prosecuted executives of IG Farben individually for supplying the deadly Zyklon B Gas to the Nazis and engaging in slave labor. But the tribunal declined to charge the corporation itself because the Allied Powers had seized the assets of IG Farben before the Nuremberg Trials had even begun. Therefore, the tribunal’s decision to prosecute the executives rather than the corporation resulted from the fruitlessness of prosecuting a defunct company rather than IG Farben’s immunity from wrongdoing. Several dissenting voices have raised this counterargument. In the 2014 case In re South African Apartheid Litigation, a District Court in New York opined that the mere fact that no international tribunal had ever proceeded against a corporation was insufficient proof that corporate liability was unknown in international law. The D.C. Circuit put forth perhaps the most compelling argument against corporate immunity in Doe v. Exxon Mobil Corporation. There, the Court highlighted the nuance in the historical context surrounding the Nuremberg tribunal’s decision not to put IG Farben on trial. EXTENDING THE LONG ARM OF THE LAW: THE ISSUE OF EXTRATERRITORIALITY US Courts have often cited the problem of extraterritoriality to justify a conservative approach in cases filed under the ATS. For instance, the primary ground for dismissing the Nestle case was the fact that all the alleged instances of slavery took place outside the borders of the US, and “general corporate activity” by US companies could not be the sole reason for holding them liable for misdeeds committed abroad. Although complex corporate structures, in which the parent corporation and its foreign subsidiaries are legally distinct entities, often create roadblocks in holding multinational corporations accountable, Courts can “pierce the corporate veil” to curb transnational crimes committed by corporations without compromising doctrinal clarity. In the United Kingdom (UK), for instance, Section 54 of the Modern Slavery Act, 2015, requires certain corporations to ensure that slavery and human trafficking are not taking place throughout their supply chains, which often involve overseas actors and suppliers. Such a standard could have been used as a potent accountability tool in Nestle because the alleged slavery was committed in the farms of Ivory Coast, which were part of the supply chains of Nestle and Cargill. In 2017, France enacted a landmark “law on due diligence” that imposes liability on parent corporations that fail to conduct due diligence in ensuring that their foreign subsidiaries and suppliers do not violate human rights. While this law has limited extraterritorial application, parent corporations often exert overwhelming influence upon their foreign subsidiaries’ business activities. In 2020, Syrian workers and two NGOs filed a criminal complaint under the law on due diligence to charge Lafarge, a French multinational corporation, for the financial assistance its Syrian subsidiary gave to the Islamic State. A more widespread application of veil piercing would go a long way in ensuring that a parent corporation cannot feign ignorance while its subsidiaries commit grave violations of law abroad. CONCLUSION The recent tendency of US courts to restrictively interpret the ATS and hinder its extraterritorial scope is gravely inimical to protecting human rights abroad. US courts’ reliance on the non-prosecution of IG Farben at Nuremberg, to justify corporate immunity flows from a misguided reading of historical facts. In this connection, any effort aimed at extending the scope of application of domestic laws to cover the acts of foreign subsidiaries is a welcome step. As the French experience and the recent Lafarge case shows, disregarding doctrinal concerns of extraterritoriality is a small price to pay for protecting human rights abroad. The theoretical uncertainty surrounding corporate liability under international law continues to persist, creating a dangerous incentive for corporations to sacrifice human rights at the altar of business expansion.

About the authors: Juan Perla is a partner in the New York office of Curtis, Mallet-Prevost, Colt & Mosle LLP, focusing on appeals and international disputes. Lise Johnson is international arbitration counsel in the firm’s London office. The authors thank associates Grace Condro and Jean Lambert for their contributions to this article. Photo by Juan Perla. On March 23, 2022, the US Supreme Court heard arguments in two cases that raise the question of whether US-based discovery is available for use in international arbitral proceedings. The first case, ZF Automotive US v. Luxshare, involves a commercial arbitration between private parties. The second, AlixPartners v. The Fund for Protection of Investors’ Rights in Foreign States, deals with a dispute between Russian investors and the Government of Lithuania under a bilateral investment treaty, which provides for investor-state arbitration (also known as investor-state dispute settlement or “ISDS”). These cases ask whether foreign or international arbitral tribunals fall within the meaning of 28 U.S.C. § 1782, the statute authorizing a district court to order discovery “for use in a proceeding in a foreign or international tribunal.” If so, any “interested person” may seek discovery from persons in the US for use in those arbitrations pursuant to the Federal Rules of Civil Procedure, which provide broader discovery than is otherwise available in arbitral proceedings and may result in sanctions for noncompliance. In answering this question, the Supreme Court will consider whether and how to take account of the differences between commercial arbitrations and ISDS for purposes of section 1782. Differences between commercial arbitrations and investor-state arbitrations Lower courts are split on whether section 1782 is available for use in commercial arbitrations (compare here and here with here and here), with some courts emphasizing the bargained-for benefits of arbitration—speed and efficiency—as reasons for not extending this provision to private arbitral tribunals. By contrast, there is a general consensus among lower courts that section 1782 applies to ISDS (see, e.g., here, here and here). In AlixPartners, for instance, the Second Circuit held that ISDS tribunals are covered by section 1782 because of their distinctive “functional attributes”—most critically that ISDS tribunals derive their jurisdiction from investment treaties between states, rather than from contracts between private parties. The US Government offered a different view. As outlined in an amicus brief in these two cases, and in a prior case raising the same issue, the US disfavors section 1782 for use in both types of arbitral proceedings, notably departing from lower courts on its understanding of ISDS. The US argued that ISDS “resembles private commercial arbitration in the most salient respects,” highlighting both the nongovernmental status of the arbitrators and the importance of efficiency in both types of proceedings. The US’ emphasis on the similarities between commercial arbitration and ISDS is notable for two reasons. First, it assumes that ISDS tribunals are all composed of privately appointed arbitrators. However, some investment treaties between the European Union and other states (at present, Canada, Vietnam, Singapore, and Mexico), refer ISDS disputes to adjudicators who are appointed in advance by joint committees of the relevant state parties and compensated by those states. Additionally, ongoing negotiations at the United Nations Commission on International Trade Law envision the creation of a standing multilateral investment court within roughly four years, which would also rely upon adjudicators appointed and paid by states. If the Supreme Court were to rule that section 1782 is not available for ISDS proceedings with private, party-appointed arbitrators, the result could be different for ISDS cases brought before a standing investment “court,” creating a dual track for investment claims against states—one in which US discovery is available and another in which it is not. Second, in other contexts, the US has taken the position that ISDS may warrant different, less efficient rules than commercial arbitrations due to the public interests inherent in ISDS. While confidentiality may be the default rule in commercial arbitration, the US has called for ISDS to be transparent and to allow for input from nonparties even though such openness may hamper the efficiency of proceedings. Regardless of what the Supreme Court decides with respect to commercial arbitration, it may be receptive to arguments about the distinctive characteristics of ISDS. During oral argument, several Justices seemed interested in understanding whether ISDS was more like dispute settlement before the World Trade Organization and state-to-state arbitrations than commercial arbitrations. Chief Justice Roberts observed that ISDS is “not a purely private undertaking,” noting its “sovereign character.” As the Chief Justice previously explained, the “uniqueness” of ISDS “should not be overlooked,” especially because those tribunals are endowed with the “power [a state] typically reserves to its own courts, if it grants it at all: the power to sit in judgment on its sovereign acts.” Indeed, ISDS tribunals hear disputes implicating important questions of governmental power such as national security measures, sovereignty over natural resources or the power to regulate public health and the environment. The decision to include or exclude ISDS tribunals under section 1782 could thus have profound consequences on how those cases are decided. Potential implications of permitting section 1782 discovery in investor-state arbitrations To date, use of section 1782 for ISDS has been relatively limited. But if the Supreme Court clarifies that this procedural device is available, there may be greater recourse to it. Since many investors bringing ISDS claims reside in the US or are connected to persons residing in the US, section 1782 could become an important tool for parties to obtain otherwise inaccessible evidence. Already, ISDS tribunals have demonstrated a willingness to receive evidence obtained through section 1782 discovery (see, e.g., here and here). As noted above, US courts have granted section 1782 discovery for use in ISDS proceedings, not only at the request of private investors, but also at the request of foreign states. For instance, in Republic of Kazakhstan v. Lawler, Kazakhstan attempted in the arbitration to obtain evidence from the investor to establish a jurisdictional defense. Unsuccessful in its evidence-gathering efforts before the tribunal, Kazakhstan then invoked section 1782 and sought the evidence directly from the investor’s sole officer and director in the US. The court granted the application. Shortly thereafter, the investor produced the requested evidence in the arbitration. There may be a variety of reasons why states may seek discovery to defend against investment treaty claims (e.g., gathering evidence on capital flows, due diligence, business plans and expectations, and possible corruption or other illicit activities), or to pursue counterclaims. In addition, investment treaties and arbitral decisions have been evolving so as to make a broader range of information relevant to ISDS claims, defenses, and counterclaims. For example, an ISDS tribunal has recognized that investors’ knowing misconduct can be more prejudicial to their claims than negligence. This, in turn, could support requests for discovery about investors’ knowledge and state of mind. Relatedly, new treaties and models are breaking ground by imposing obligations directly on investors and on their investments, and by providing that investors may face financial sanctions for violating standards found in soft law instruments such as the OECD Guidelines on Multinational Enterprises. Discovery may be useful in proving that companies, their investors, or their shareholders have breached relevant standards. Another potential user of section 1782 discovery may be any nonlitigant who can demonstrate that they are an “interested person” under the statute. This could include public interest groups whose participation as amici is expressly permitted under a growing number of investment treaties and arbitral rules governing ISDS cases. Potential amici may want to provide input to advance or protect their own discrete rights or interests (as might be the case if the investor is claiming property rights subject to competing claims), or to protect and promote general public interests (e.g., by elaborating upon and applying norms of corporate responsibility under international law). These groups may want to use section 1782 to strengthen their input. In sum, it is not a foregone conclusion that the Supreme Court will agree with lower courts that ISDS tribunals are covered by section 1782, especially in light of the US’ opposition. But if the Court does agree, then US-based discovery could become a more important tool in litigating ISDS claims in the future.

About the author: Ankit Kapoor is a fourth-year BA-LLB (Hons.) student at National Law School of India University, Bangalore. He is acutely interested in the intersection between technology and the law. Presently, he has worked with renowned litigators, law-firms, and policy-makers in India on data protection/governance as well as legal and policy challenges from the internet, blockchain, and artificial intelligence. Photo by Marco Verch available here. Introduction There are at least 2,247 different cryptocurrencies worldwide, with a total market capitalization of $171 billion and valuation around $2 trillion. While this constitutes a fraction of the aggregate financial market, trends indicate that crypto-transactions will rise exponentially in the next decade. However, it is well-recognized that the unique characteristics of cryptocurrencies facilitate tax evasion, with over $1.4 billion illicitly funneled. The increasing global crackdown on offshore tax havens also renders crypto-transactions more lucrative. Blockchain is an open and distributed ledger that records transactions amongst parties permanently, verifiably, and efficiently. The architecture of blockchain imbues it with key characteristics: decentralization, pseudonymity, immutability, and transparency. Cryptocurrencies are a type of virtual currency that operates on blockchains. Therefore, they use blockchain protocols and demonstrate its characteristics. The European Commission has defined cryptocurrency as a digital representation of value that is neither issued by a public authority nor attached to a fiat currency, but is accepted by persons as an electronic medium of exchange, store of value, and/or unit of account. Outlining Tax Evasion Concerns from Crypto-Transactions There are two kinds of tax evasion: evasion of assessment and evasion of payment. The most common is evasion of assessment, where the evader wilfully attempts to omit the levy of taxes on income either by underreporting their income or overstating their deductions. The other is evasion of payment, where the evader escapes tax liability by concealing funds or assets. Both forms of tax evasion create economic distortions because the resources invested in evading liability create no social benefit. I. Features enabling evasion Crypto-transactions facilitate tax evasion because they are anonymous and decentralized.Additionally, structural problems like global non-uniformity and inadequate disclosure and reporting make regulation and enforcement difficult. Anonymity prevents government authorities from tracing the identity of the evader. This restricts transactions from being monitored and sanctioned by tax authorities, enabling evaders to operate outside of the regulatory perimeter. As explained earlier, the anonymity of crypto-transactions can range from pseudonymity to complete anonymity. While the former allows for some traceability, it is far too expensive, complex, and inaccurate to yield consistent results. Decentralization means the absence of a centralized authority. This hinders regulatory efforts because there are no issuers or payment processors to use as focal points of regulatory action. Moreover, there are little to no intermediaries, which reduces vulnerabilities for the evader. Cross-border transactions further enhance decentralization because countries lack a uniform approach to recognizing and classifying crypto-transactions for tax purposes. Therefore, cross-border transactions facilitate evasion. Moreover, some countries have lax rules and enforcement, which frustrates domestic information gathering and enforcement. There is also inadequate disclosure and reporting because anonymity reduces the type of information crypto-intermediaries may themselves have. Further, there are no mandatory disclosure and reporting requirements for reporting income from crypto-transactions. Since tax evasion investigations depend on “following the paper trail,” this lack of information handicaps tax authorities. II. Mechanisms Enabling Evasion Peer-to-Peer Transfers Peer-to-peer transfers are crypto-transactions undertaken between two users through their wallets, outside exchanges, and platforms. Strategically, this is the best option for evaders because it does not involve any intermediaries, creating almost no traceability. Conversion into Fiat Currency All convertible non-centralized virtual currencies are tradeable or purchasable with fiat currency, represented by traditional options like cash. This is facilitated through confidential transactions with online vendors, or through cryptocurrency ATMs. Using Third-Party Agents Under these confidential schemes, an investor subscribes to the stock of a company by paying the buying agent through cryptocurrency. Thereafter, the agent remits any dividends on stock of the company to the investor. Fork and Merge Crypto investors use the “fork and merge” pattern to hide the source and destination of funds. This involves either splitting large volumes of the cryptocurrency into multiple small accounts owned by the same investor or purchasing the cryptocurrency in smaller lots using multiple wallets. Anonymizers Anonymizers involve the use of third-party tools like “mixers” or “tumblers.” Mixers obfuscate the source of certain units of cryptocurrency by mixing the cryptocurrency of multiple investors before the concerned units are delivered to their desired destination. Tumblers sever the link between the buyer and seller entirely. Privacy Coins While typical cryptocurrencies only provide pseudonymity, “privacy coins” like Monero and Verge are effectively invisible because they leave no trace. Proposing a Multi-Stage and Multi-Levered Toolkit The anonymity, decentralization, non-uniformity, and inadequate information concerns must be addressed at all three stages of the tax regulation process: information gathering, investigation, and enforcement. Given the complexity of the discussed evasion mechanisms, regulators must use architectural and market tools in addition to legal tools. So far, most regulators have restricted their action to merely legal tools. Architectural tools are the instructions embedded in software and hardware, as well as the institutional design of the blockchain. Market tools are the forces of demand, supply, and quality, as well as the acceptable market practices and institutions. I. Information Gathering Disclosure and Reporting Requirements As a legal solution, regulators must mandate disclosure and reporting of crypto-transactions when they exceed a predetermined de minimis threshold. The threshold should be determined based on each jurisdiction’s unique circumstances, but the US’ $10,000 threshold is a good starting point. The requirement must extend to all crypto-exchanges, payment settlement entities, and custodian wallet providers. As per reports, such third-party disclosures can improve taxpayer compliance rates by 95%. The Financial Action Task Force proposed the travel rule, which requires all crypto firms to securely transmit originator and beneficiary information between themselves while transacting. Regulators must mandate this domestically. Importantly, there is a need for architectural intervention because, unlike SWIFT, there is no communication network to reliably transfer identification data along with crypto-transactions. There are emerging market solutions to this, such as the OpenVASP Association or the Sygna Bridge. However, it is imperative that countries reach global consensus on one of these networks to avoid fragmentation and ensure interoperability. At the investor level, regulators can design voluntary self-disclosure forms for person-to-person transactions. However, the complexity of the present system has enabled the emergence of market players, like Koinly or CoinTracker, that charge exorbitantly. Regulators can decrease the leverage of these players by simplifying the compliance process or by imposing ceilings on their fees. By providing appropriate incentives and adequate safeguards, regulators can establish effective whistleblower programs. This will provide exposure to reports from those inside the business, who are best placed to expose any wrongdoing. Through these interventions, regulators can establish an effective feedback loop within each market participant. John Doe Summons While disclosure and reporting requirements are useful, they are limited when the entities are recalcitrant or when their adoption is delayed due to structural issues. Here, regulators can enact provisions allowing “John Doe summons.” In the US, tax authorities use them as legal tools to obtain information (names and documents) about unnamed taxpayers from a third-party. This information can then be combined with data from publicly available databases to examine compliance. International Cooperation Global consensus on crypto-asset taxation is vital. While jurisdictions may adopt different classifications, they can at least functionally and reciprocally enforce each other’s regulations. More importantly, there is a need for timely and comprehensive exchange of information across borders, which would enable regulators to perform risk analysis. The ineffectiveness of bilateral taxation treaties, due to complexity, time, and opportunity cost, necessitates the adoption of multilateral treaties to ensure an extensive network of tax information. Given concerns of ceding sovereignty, this solution can be administered through an international body like OECD. Traceability Requirements Traceability of taxpayer information is required for both individuals and entities. To collect information about individual investors, regulators must legally mandate that all crypto-exchanges adopt Know Your Customer (KYC) procedures. KYC is the initial stage in customer due diligence by the service-provider to verify that customers are who they claim to be. This requires the collection of personal data like full name, date of birth, and address. This information is then verified against official government databases. KYC enables the service provider to also assign a risk value to the customer based on their propensity and background. Presently, KYC implementation is abysmal with 69% crypto-exchanges lacking adoption. There is also a need to recognize that the architecture of certain technologies precludes or obfuscates any traceability. Regulators must consider banning privacy coins since they provide an excessive degree of anonymity. Otherwise, mandatory registration past a materiality threshold must be imposed. Additionally, regulators must forbid crypto-platforms from allowing the usage of anonymizers and even proactively block access to such software on the internet. II. Investigation Analysis Data Analytics Regulators should engage in architectural solutions like tracking crypto-transactions, scraping data, and using analytics to derive insights. The insights gathered from each of these tools when combined will provide regulators with a 360-degree view of the taxpayer. Inducting Experts The data collected and insight deduced are only as good as the people interpreting them. Therefore, tax authorities must consciously expand their membership to subject matter experts in data science, cryptocurrency, and behavioral science. Red Flags Regulators can use indicators of suspicious market activity to focus their efforts for further monitoring and examination. These red flags extend to inter alia the size and frequency of transaction, suspicious transaction patterns, excessive usage of anonymity, and the source of wealth. III. Enforcement Borrowing from South Korea, countries can implement laws to empower regulators to seize cryptocurrencies from the digital wallets of offenders. To enforce this, crypto-exchanges and wallet providers will have to implement necessary architectural changes. Conclusion Cryptocurrencies have emerged as the new tax havens due to their anonymity and decentralization, alongside structural problems of non-uniformity and inadequate information. Tax evasion through crypto-transactions is mechanized through various disparate means. The complexity of this problem requires an intervention at each stage of tax policy: information gathering, investigation analysis, and enforcement. At each stage, there must be a multi-level response using architectural and market tools alongside the law.

Article by: Sahaj Mathur Photo available here. Introduction India’s interaction with the international investment regime experienced a paradigm shift after the 2011 arbitral tribunal decision in White Industries v. The Republic of India. In the White Industries arbitration, Australian corporation White Industries alleged that the Republic of India (India) breached its obligations under a bilateral investment treaty (BIT) between India and Australia. The tribunal granted White Industries a $4 billion award, leading to India’s heightened caution and suspicion against the international investment regime. As a knee jerk reaction to the White Industries arbitration, India terminated a majority of its BITs, and in 2016, introduced a new Model BIT. India intended to use this model as a template as it renegotiated its BITs. India designed its Model BIT to address the inherent asymmetry in the earlier BITs, which upheld the rights of investors without imposing any corresponding duties. In this light, India introduced a Corporate Social Responsibility (CSR) clause in Article 12 of the Model BIT. The CSR provisions reflect a growing global concern with the inability of the investor-state arbitration system to address the impact of foreign investment on human rights, the environment, corruption, and labor rights of the host state. The inclusion of the CSR clause in the Model BIT, as well as in other new-age BITs, can be seen as a response to the lack of accountability of investors under the International Investment Regime for their conduct in foreign states. The CSR clause raises crucial questions regarding its scope and functionality. In particular, it is unclear how an investor-state arbitral tribunal will interpret and apply the CSR provision when it interacts with other provisions of the Model BIT. Deconstructing Article 12 of the Indian Model BIT: CSR and India’s Investment Regime A significant innovation in India’s Model BIT is the imposition of duties on investors. India’s approach presents a shift from the traditional regime, which imposed liabilities solely on the host state. The CSR Clause contains four key features. First, the CSR Clause applies directly to investors, rather than to host states. In contrast, previous “indirect” CSR clauses imposed duties on States to promote responsible corporate conduct for corporations operating within their jurisdiction. The indirect CSR clauses required the state to take any action necessary through its domestic law and policy to ensure compliance with CSR standards. If the state failed to facilitate compliance, then the legal effect of the indirect CSR Clause would be extremely limited, since investors held no CSR responsibilities. In contrast, the direct CSR clause under Article 12 applies directly to investors, making them responsible for complying with internationally recognized CSR standards. As Section III explores, the direct CSR clause can have a significant role in Investor-State disputes. Second, the CSR Clause focuses on “non-investment concerns” by emphasizing labor, human rights, environmental, corruption, and community relations concerns. The inclusion of these issues also represents an effort at rebalancing India’s interaction with the international investment regime to safeguard its right to pursue its policy objectives. Given the growing global concern against the international investment regime, the inclusion of such non-investment concerns within the existing regime can provide a significant roadmap to address some of the drawbacks of the current system. Third, Article 12 expressly states that investors shall incorporate “internationally recognized standards” of CSR into their business practices. However, Article 12 does not state which particular international CSR standards apply, making interpretation challenging. To overcome this uncertainty, a tribunal could look to several international instruments, including the OECD Guidelines for Multinational Enterprises, the Ten Principles of the UN Global Compact, and the UN Guiding Principles on Business and Human Rights. Fourth, Article 12 characterizes the CSR clause as voluntary. The voluntary nature of the provision implies the absence of any binding obligation on Corporations to comply with the aforementioned CSR standards. Thus, within the context of Investor-State Dispute Resolution, a state cannot claim the breach of a CSR principle as a “claim” or “counterclaim” against an investor. Existing literature analyzing the Model BIT has criticized the voluntary nature of the CSR provision. In principle, a binding and mandatory CSR provision may appear to be an appealing suggestion. However, under the existing framework of public international law, corporations cannot be definitively treated as subjects of international law on which obligations can be imposed. Therefore, imposing human rights and environmental obligations on corporations lacks doctrinal support. Negotiations on a proposed Business and Human Rights Treaty, which would impose such obligations on corporations under public international law are ongoing. However, unless these negotiations materialize into a legally binding treaty framework, there is minimal theoretical justification for placing CSR obligations on investors. However, despite a lack of doctrinal support for imposing a mandatory obligation, a soft law document may still carry significance and legal effect for investors. Corporate Social Responsibility and Investor-State Dispute Settlement: Towards a New Approach? Article 12 may introduce social and environmental concerns to the inquiry undertaken by an investor-state tribunal, particularly at the damages stage. While an investor’s breach of internationally recognized CSR standards may not give rise to a claim, they may factor into a tribunal’s assessment of damages. The dissenting opinion in Bear Creek v. Peru supported such an approach. In the dissenting opinion, the tribunal asserted that when determining the compensation owed to an investor, certain activities of the investor must be taken into account. Such activities include the investor’s due diligence, environmental impact assessment, and social impact assessment. Thus, the amount owed to an investor can be significantly lowered if the tribunal observes that the investor failed to comply with principles of CSR. Other tribunals have employed this methodology, as in Biwater Gauff v. Tanzania. Article 26.3 of the Indian Model BIT and the footnote to the Article provide a preexisting basis for adopting this approach. Article 26.3 provides that a tribunal shall reduce damages owed to an investor after taking into account mitigating factors that would reduce the harm. The footnote suggests that such harm can include “unremedied harm or damage” to the local community or environment. Article 26.3 has been criticized for providing arbitral tribunals with wide discretion to determine what would constitute a mitigating factor, given the vagueness of the provision. It is proposed that Article 26.3 can be interpreted in light of Article 12 of the BIT. Thus, the mitigating factors mentioned in Article 26.3 can be derived from the internationally recognized CSR principles in Article 12. Therefore, investor conduct that breaches these provisions would constitute a mitigating factor which would reduce their compensation. As Markus Krajewski argues in the dissenting opinion in Bear Creek, such a methodological approach would have a direct effect on investors’ behavior. Given the quantifiable impact on damages owed to an investor if a breach is found, the proposed approach can provide an effective mechanism to ensure investors’ compliance with their CSR obligations. Thus, the proposed approach can be significant in introducing non-investment concerns within investor-state arbitration. CSR clauses in BITs have arisen as a response to the inherently lopsided nature of international investment law characterized by the lack of investor accountability. Article 12 of India’s Model BIT seeks to reinforce its right to regulate to achieve its policy objectives. These CSR clauses are considerably broad in scope, allowing them to serve as the bridge between public policy concerns and investor-state arbitration, which have long been seen as incompatible. Although Article 12 is not directly enforceable, the development of public international law on legally binding corporate obligations would further support these CSR provisions. This could lead to a situation where India could even file a claim against an investor for not acting in accordance with its CSR obligations.