The outlook for the continued vitality, or lack thereof, of investor–State arbitration

Abstract

Criticism of investor–State arbitration has reached its apogee with the proposal of the European Commission for replacing it with a standing tribunal and appeals recourse whose members would be appointed exclusively by States Parties to the Transatlantic Trade and Investment Partnership. The proposal is cast in terms designed to appease the unsound elements of that criticism. The arguments for so replacing investor–State arbitration are unpersuasive. Negotiating and realizing the EU’s proposal would be problematic. While the substantive principles of international investment law envisaged by the EU proposal rightly maintain the principles embodied in bilateral investment treaties, the EU’s approach risks producing international negotiations over those principles that could lead to sterile international confrontation.