Investment treaty arbitration as global administrative law: What this might mean in practice

Abstract

Introduction In 2008, Professor Jan Paulsson gave an address in Montreal in which he declared dramatically that ‘international arbitration is not arbitration’. It is not the aim of the present chapter to contend that investment treaty arbitration is not arbitration. That is a feat of debating for which only Professor Paulsson would be qualified. However, the premise advanced does have more than a whiff of paradox about it: that bilateral investment treaties (BITs) are not international investment agreements; they are instruments of global administrative law. The purpose of this chapter is to consider what this might mean in practice. My premise is nothing new. It was the central thesis of Gus van Harten's seminal 2007 book, Investment Treaty Arbitration and Public Law . In that book, he neatly summarised his case as follows: Investment treaty arbitration is often viewed as a form of reciprocally consensual adjudication between an investor and a state. The argument of this chapter is that it should be viewed as a mechanism of adjudicative review in public law. That is the case for two reasons: first, the system is established by a sovereign act of the state; second, it is predominantly used to resolve disputes arising from the exercise of sovereign authority . . . As a public law system, investment treaty arbitration engages the regulatory relationship between state and individual, rather than a reciprocal relationship between juridical equals. Indeed, unlike any other form of international arbitration, it gives private arbitrators a comprehensive jurisdiction over disputes in the regulatory sphere.