Judicialization of international investment arbitrations

Abstract

After decades of implementation of the ISDS mechanism for the settlement of arbitration disputes from bilateral and multilateral agreements on the protection and promotion of foreign investment, which has been contracted in various types of international investment agreements, in the last two decades there is intensive work on their revision or replacement. Discussions are conducted within UNCITRAL, UNCTAD, OECD and EU. The paper analyzes the proposal made on behalf of the EU by the European Commission in way of judicialization of arbitration. The European Commission proposes to replace the existing system of arbitration settlement of disputes by a judicial mechanism, by establishing a permanent international court and the Court of Appeal. Initially, a permanent court mechanism would be contracted into bilateral agreements that the EU would conclude with third countries. Subsequently, a special international convention would be adopted which would change bilateral agreements. The paper provides an analysis of the solution proposed by the EU, but the dilemma remains that it is only a "repackaged" ISDS mechanism and whether the proposed judicial mechanism can meet the expectations that exist in terms of greater transparency of the procedure, impartiality of judges and preservation of the legislative autonomy of the host countries.