Investment Treaty Arbitration as Justice Bubbles (original) (raw)

Investment treaty arbitration: A justice bubble for the privileged* Anil Yilmaz Vastardis** 'There is the old idea, which has withstood the passage of time, that dominant social forces in society maintain their domination not through the use of force but through having their worldview accepted as natural by those over whom domination is exercised.' 1 Historically, the use of international arbitration to resolve foreign investment disputes was advocated to prevent discrimination against foreign investors on the basis of their nationality and avoid violation of their due process rights by so-called abusive governments with weak judiciaries. For this reason, the use of international investment arbitration, particularly investment treaty arbitration (ITA), which arguably has the strongest rights enforcement mechanism existing in international law, 2 has been perceived as facilitating access to justice for foreign investors at the international level. Despite ITA's popularity with investors, this system of dispute settlement has been criticised by state actors, legal scholars, and civil society activists alike for flaws such as lack of consistency, transparency, excessive costs, impartiality and independence of arbitrators. Ironically, ITA has been promoted to uphold rule of law in host state relationships with foreign investors, but it has been diagnosed with a rule of law deficit itself. In response, several formal initiatives have been launched to reform the existing model of investment arbitration to inject rule of law into ITA. 3 The most * This is a revised version of an essay which was originally published as A Yilmaz Vastardis 'Justice Bubbles for the Privileged: A Critique of the Investor-State Dispute Settlement Proposals for the EU's Investment Agreements' (2018) 6(2) London Review of International Law 279.