Dispute Settlement Provisions in International Investment Agreements: A Large Sample Survey
International investment agreements (IIAs) serve as a crucial pillar of the global economy, providing a framework for cross-border investment and protecting the rights of investors. However, disputes arising from these agreements can have significant economic and social consequences. Thus, it is essential to understand the dispute settlement provisions in IIAs. This article discusses the findings of a large sample survey on dispute settlement provisions in IIAs.
The survey included 1,119 IIAs signed between 1959 and 2017 that contained dispute settlement provisions. The provisions were categorized into two broad categories: state-to-state dispute settlement (SSDS) and investor-state dispute settlement (ISDS). SSDS involves disputes between states, while ISDS allows investors to bring claims against states. The survey found that 76% of the agreements had ISDS provisions, while only 16% had SSDS provisions. The remaining 8% had both ISDS and SSDS provisions.
The survey also revealed that most IIAs with ISDS provisions included both arbitration and mediation as dispute settlement mechanisms. In contrast, IIAs with SSDS provisions primarily relied on the International Court of Justice (ICJ) as the dispute settlement mechanism. Furthermore, IIAs signed between 2000 and 2017 were more likely to include ISDS provisions than those signed before 2000.
Moreover, the survey analyzed the features of ISDS provisions, including the type of arbitration used, the qualifications of arbitrators, and the rules governing the proceedings. The findings show that the majority of IIAs used ad hoc arbitration instead of institutional arbitration. Additionally, the qualifications of arbitrators varied widely, with some agreements requiring only basic qualifications, such as being a lawyer or having experience in international law. However, others required more stringent qualifications, such as having experience in investment law and economics.
The survey also revealed that the rules governing ISDS proceedings varied significantly across IIAs. While some agreements adopted well-established arbitration rules, such as the International Centre for Settlement of Investment Disputes (ICSID) rules, others adopted their unique rules. The lack of consistency in the rules governing ISDS proceedings could lead to disparities in the outcomes of disputes and make it challenging to predict the potential outcome of a dispute.
In conclusion, this survey provides a comprehensive overview of the dispute settlement provisions in IIAs. The findings show that ISDS provisions are prevalent in IIAs, while SSDS provisions are less common. Additionally, it highlights the need for greater consistency in the rules governing ISDS proceedings. These insights could be useful for policymakers and investors seeking to understand the dispute settlement mechanisms available to them and the potential risks associated with cross-border investments.