Report on UNCITRAL Colloquium on the Law of International Trade for a Greener Future (23-24 October 2024)

On 23-24 October, the UNCITRAL Colloquium on the Law of International Trade for a Greener Future was held in Vienna.

At its 57th session, in 2024, UNCITRAL requested the secretariat to organize a colloquium on the relevance of UNCITRAL instruments to climate action, notably the United Nations Convention on Contracts for the International Sale of Goods (CISG), the Model Law on Public Procurement, the Model Legislative Provisions on Public-Private Partnerships and the instruments on dispute settlement.

The aim of the colloquium was to help UNCITRAL assess the desirability for the secretariat to prepare guidance documents on the practical application and interpretation of existing instruments and possible supplementary texts to address issues concerning climate action.

The main conclusions of the colloquium will be presented to the Commission for consideration at its fifty-eighth session in 2025.

The first panel focused on trends and initiatives, both internationally and domestically, to modernize public procurement through the incorporation of “green” considerations in the procurement procedures and will assess the scope and best methods of incorporating “green” procurement in the UNCITRAL Model Law on Public Procurement.

The second panel discussed the emerging need for greening commercial goods supply chains and climate-related regulations, voluntary commitments and contractual requirements applicable to supply chains from the perspective of the CISG, both in terms of applicable law and enforcement mechanisms and substantive rules on conformity of goods, breach of contract and damages.

The third panel aimed to look into how States could enhance their climate actions through public-private partnerships and whether the UNCITRAL Model Legislative Provisions on Public-Private Partnerships provides an adequate legal mechanism for States in this regard.

The last panel considered the role of UNCITRAL dispute resolution texts in contributing to efficient and fair settlement of climate change disputes, in particular, the UNCITRAL texts in the field of arbitration and mediation for both international commercial and investment disputes.

With the growing number of international and domestic regulations addressing climate change and aligning with the Paris Agreement, climate change disputes are also on the rise.

The panel began by examining the critical issue of the classification of the climate related disputes (taxonomy of disputes) or legal frameworks for an efficient use of the UNCITRAL Instruments. The normative landscape on these topics are highly fragmented (national, international, binding, non-binding, judgement influenced acts, various standards and policies, incentives, ...).This complex array of norms impacts all economic sectors and branches of law, with each standard and regulation influencing the others.

As a starting point, it was pointed out that no unique definition of a “climate change litigation” exists. Climate change could be the subject matter of the dispute or climate change considerations are raised indirectly/incidentally to the subject matter of disputes.

The following categories of disputes exist:

UNCITRAL can contribute to procedural harmonization through efficient dispute resolution mechanisms. The panel highlighted specific gaps in UNCITRAL’s mechanisms that need to be addressed in this context: transparency, public participation, and the involvement of technical experts. The panel discussed various proposals, such as incorporating a criterion of “climatic internationality” and introducing a specialized procedural regime.

The panel proposed to develop UNCITRAL non-binding Notes on ADR for climate changes proceedings These Notes would provide guidance to highlight the unique nature of climate-related disputes while allowing the necessary flexibility. The Notes are relevant for the globality and emergency of the topic and will transcend the fragmentation of the legal landscape. The Notes would influence  lawyers (climate conscious lawyers) and the parties.

The following topics could be addressed :

•         Broad definition of climate-change dispute

•         Identify the climate change elements

•         Acknowledge the public interests of this category of cases

•         Highlight issues to keep in mind to search for in the case

•         Principles of burden of proof

•         Calculation of damages

•         Encourage mediation process

•         Appointment of specialized arbitrators (?)

•         Dispute boards

•         Applicable law to the merits and to the procedure? Choice of law could be influenced by climate change element of the case

The panel also discussed the topics that should not be included, for example procedural guidance to reduce carbon footprints as it already exists with the Campaign for Greener Arbitration that has a very wide support.

The panel also highlighted the relevance and advantages of the mediation process in the context of climate change disputes, mentioning the constant growth of national laws on this topic and the Singapore Convention on Mediation.

This process offers the advantage of flexibility, allowing third-party stakeholders (such as NGOs, indigenous communities, and others) to participate by contributing expert insights, reports, and perspectives, fostering a holistic approach to the dispute. Non-legal issues can also be addressed, and the mediation process enables consideration of the diverse perspectives in climate-related disputes to find solutions focused on aligning interests rather than strictly on legal rights. Mediation can help de-escalate situations and provide customized solutions and strategies that keep projects viable.

Additionally, mediators can be chosen based on their skills, language abilities, and cultural competencies, ensuring an inclusive approach. Mediation fosters ongoing communication and long-term relationships among parties. This approach is particularly beneficial in cases where multiple legal frameworks apply. The success rate of mediation processes is particularly high.

Mediation can also be used as a prevention mechanism with the “project mediation” system.

The panel also pointed out that the mediation process is not always ideal, especially when transparency and public awareness are priorities. Its impact on broader climate responses may be limited, as mediation does not create legal precedents or set normative standards. The confidentiality level can, however, be adjusted on a case-by-case basis.

Additionally, mediation may offer less protection to less powerful parties (such as third-party stakeholders), potentially leading to power imbalances among participants. Challenges can also arise in enforcing mediated agreements, highlighting the importance of the Singapore Convention in this context. These issues should be addressed in the Notes.

The panel also discussed the value of promoting multi-tier dispute resolution clauses in climate change disputes and emphasized that the Notes should outline best practices for mediation in climate-related cases to raise awareness about the benefits and limitations of this process.