International Investment Law and Arbitration Commentary, Awards and other Materials

This concluding chapter discusses the current backlash against investment arbitration and investment treaties. Section 1 discusses the backlash to investment arbitration under Chapter 11 of the NAFTA in the early 2000s, and the consequent ‘rebalancing’ of the US Prototype BIT of 1994 in 2004. The chapter goes on to discuss how the backlash grew, beginning in 2007, from Bolivia’s, Ecuador’s and Venezuela’s terminations of their participation in the ICSID Convention and other similar terminations worldwide, to various countries’ efforts to ‘rebalance’ (i.e. rewrite) their own BITs and other investment agreements. Section 2 highlights some of the latest treaty clauses which have emerged from this worldwide rebalancing effort, focusing on some of the most important substantive clauses, namely FET and expropriation clauses, particularly in connection with the controversy over the continued ability of host States to enact environmental, health and other public welfare measures. The chapter then turns to current procedural innovations and proposals for reform, such as the proposal for an appellate mechanism. Section 3 concludes this chapter with the European Union’s current proposal to replace investment arbitration altogether with a ‘Multilateral Investment Court’. Today, the system for settling investment disputes through investment arbitration faces proposals for its improvement, as well as for its demise, or at least its diminution as the principal mode of investment dispute settlement. Yet here is a field which has always seen such shifts in sentiment, and little of what has been said in this book will likely be irrelevant in understanding what the future brings.