Reforming Investor-state Dispute Settlement: The EU Multilateral Investment Court Perspective

Amina Akperlinova; Kasper Jastrzebski

doi:doi:10.11648/j.jim.20221101.11

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Reforming Investor-state Dispute Settlement: The EU Multilateral Investment Court Perspective

Amina Akperlinova, Kasper Jastrzebski

Published in Journal of Investment and Management (Volume 11, Issue 1)

Received: 5 December 2021 Accepted: 21 December 2021 Published: 28 January 2022

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Abstract

Rapid changes to the global socio-political dynamics have led the emergence of new challenges to the investor-state dispute settlement (ISDS) mechanism. The imperfections of the existing ISDS system have shown a clear need for reforming this institution. Moreover, this is evidenced by the desire of a number of countries to create a multilateral investment court as proposed by the European Union. Will the new EU Multilateral Investment Court System be better than the current ISDS mechanisms? The Multilateral Investment Court System is the latest proposed measure in the context of multilateralism and the institutionalization of a decentralized international investment law regime. The success of the proposal will declare a new era for international investment law around the world. Still, the proposed reform of ISDS has both benefits and disadvantages. The main goal of this paper is to examine investor-state dispute settlement (ISDS) reform in the context of the EU Multilateral Investment Court by pointing out the shortcomings and rooms for improvement. In addition, this paper indicates that the MIC project has the greatest chance of support by majority of countries, as compared to other possible options for the proposed ISDS reform but at the same time, it has difficulties in achieving the goals of ISDS and fully realizing potential. The results of this research should help to proceed with smooth transition of the MIC to ISDS system and review issues for further discussion.

Published in	Journal of Investment and Management (Volume 11, Issue 1)
DOI	10.11648/j.jim.20221101.11
Page(s)	1-9
Creative Commons	This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.
Copyright	Copyright © The Author(s), 2024. Published by Science Publishing Group

Keywords

Multilateral Investment Court (MIC), Investor-State Dispute Settlement (ISDS), Investment Law

References

[1]	Investment Dispute Settlement Navigator on UNCTAD official website statistics: https://investmentpolicy.unctad.org/investment-dispute-settlement
[2]	Wang Guiguo, Yuk-Lun Lee, Mei-Fun Leung “Dispute Resolution Mechanism for the Belt and Road Initiative” p 8.
[3]	Washington Convention https://icsid.worldbank.org/resources/rules-and-regulations/convention/overview
[4]	A. M. Mineur, H. Scholz, L. S. Caldentey (2019), Position paper for the UNCITRAL Working Group III (Investor-State Dispute Settlement Reform), New York.
[5]	Database of ICSID Member States https://icsid.worldbank.org/about/member-states/database-of-member-states
[6]	Yukos Universal Limited (Isle of Man) (Private entity) v. The Russian Federation, Permanent Court of Arbitration (PCA) Case No. 2005-04/AA227. This arbitral award was canceled by The Hague District Court decision No. C/09/477160 / HA ZA 15-1.
[7]	Bechtel v. India, ad hoc Case No. 12913/MS https://investmentpolicy.unctad.org/investment-dispute-settlement/cases/104/bechtel-v-india
[8]	Eureko vs. Poland case, ad hoc Case No. RG 2005/1542/A https://investmentpolicy.unctad.org/investment-dispute-settlement/cases/124/eureko-v-poland
[9]	Cargill v. Mexico, ICSID Case No. ARB (AF)/05/2 https://investmentpolicy.unctad.org/investment-dispute-settlement/cases/204/cargill-v-mexico
[10]	Renco v. Peru, ICSID Case No. UNCT/13/1 https://investmentpolicy.unctad.org/investment-dispute-settlement/cases/417/renco-v-peru-i-
[11]	UNCTAD, “Transparency: UNCTAD Series on Issues in International Investment Agreements II”, United Nations, 2012, pp 8-10.
[12]	Ronald S. Lauder v. Czech Republic (1999) and CME Czech Republic B. V. v. Czech Republic (2000), two parallel arbitration cases under UNCITRAL.
[13]	M. Hodgson and A. Campbell (2017): Damages and costs in investment treaty arbitration revisited, Global Arbitration Review, https://www.itd.or.th/wp-content/uploads/2019/09/Annex-2-Allen-and-Overy-Damages-and-costs-in-investment-treaty-arbitration-revisited-December-2017.pdf
[14]	IIA Issues Note: Reform of Investor-State Dispute Settlement: in Search of a Roadmap https://unctad.org/system/files/official-document/webdiaepcb2013d4_en.pdf
[15]	UNCITRAL Working Group on Investor-State dispute settlement (ISDS) reform fixes its project schedule and starts to develop solutions https://unis.unvienna.org/unis/en/pressrels/2019/unisl284.html
[16]	Yang, Hyoeun, The EU's Investment Court System and Prospects for a New Multilateral Investment Dispute Settlement System (October 12, 2017). KIEP Research Paper No. Policy References 17-06, Available at SSRN: https://ssrn.com/abstract=3063843 or http://dx.doi.org/10.2139/ssrn.3063843
[17]	The Multilateral Investment Court project http://trade.ec.europa.eu/doclib/press/index.cfm?id=1608
[18]	Andreea Nica, ‘UNCITRAL Working Group III: One Step Closer to a Multilateral Investment Court?’, Kluwer Arbitration Blog, March 24 2020, http://arbitrationblog.kluwerarbitration.com/2020/03/24/uncitral-working-group-iii-one-step-closer-to-a-multilateral-investment-court/
[19]	C. A. Mackenzie (2014), “Summarizing Risk Using Risk Measures and Risk Indices”, Risk Analysis Vol 34 (12) December 2014, pp 2143-2162.
[20]	M. Bungenberg, A. Reinisch (2020), From Bilateral Arbitral Tribunals and Investment Courts to a Multilateral Investment Court, Options Regarding the Institutionalization of Investor-State Dispute Settlement, pp 44-45.
[21]	ICJ Art 13 allows the re-election of the adjudicator, while ECHR’s Art 23 prohibits this practice.
[22]	H. L. Ning, T. Qi (2018), Multilateral Investment Court: The Gap Between the EU and China, The Chinese Journal of Global Governance, Sept 2018, pp 154-175.
[23]	J. P Charris-Benedetti (2019), The proposed Investment Court System: does it really solve the problems, Revista Derecho del Estado no 42 Bogotá. 2019.
[24]	CMS Gas Transmission Company v. The Argentine Republic (2001), ICSID Case No. ARB/01/8.
[25]	C. M. Brown (2017), A Multilateral Mechanism for the Settlement of Investment Disputes. Some Preliminary Sketches, ICSID Review, 2017, Vol 32 (3), pp. 673–690.
[26]	A. E. A. Garzón (2019), “Designing a Multilateral Investment Court: Blueprints for a New Route in Investor-State Dispute Settlement”, ZEuS Zeitschrift für Europarechtliche Studien 22 (3), pp 477-502.
[27]	TTIP Draft, Art 29 (1) provides that: “Either disputing party may appeal before the Appeal Tribunal a provisional award, within 90 days of its issuance […]”.
[28]	WTO Dispute Settlement Understanding, Art 17 (3) provides that: “As a general rule, the proceedings shall not exceed 60 days from the date a party to the dispute formally notifies its decision to appeal to the date the Appellate Body circulates its report. In fixing its timetable the Appellate Body shall take into account the provisions of paragraph 9 of Article 4, if relevant. When the Appellate Body considers that it cannot provide its report within 60 days, it shall inform the DSB in writing of the reasons for the delay together with an estimate of the period within which it will submit its report. In no case shall the proceedings exceed 90 days.”
[29]	TTIP Commission draft text, Art 29 (3) provides that: “As a general rule, the appeal proceedings shall not exceed 180 days from the date a party to the dispute formally notifies its decision to appeal to the date the Appeal Tribunal issues its decision. When the Appeal Tribunal considers that it cannot issue its decision within 180 days, it shall inform the disputing parties in writing of the reasons for the delay together with an estimate of the period within which it will issue its decision. In no case should the proceedings exceed 270 days.” See also EU-Singapore IPA, Article 3.19 (4).
[30]	CETA Art 8.28 (7)(b) provides that: “The CETA Joint Committee shall promptly adopt a decision setting out the following administrative and organisational matters regarding the functioning of the Appellate Tribunal: (b) procedures for the initiation and the conduct of appeals, and procedures for referring issues back to the Tribunal for adjustment of the award, as appropriate”; See also, Art 8.28 (9) (c).
[31]	S. Zleptnig (2002), The Standard of Review in WTO Law: An Analysis of Law, Legitimacy and the Distribution of Legal and Political Authority, pp 4-7, European Integration Online Papers, 2002, Vol 6 (17).
[32]	WTO Dispute Settlement Understanding, Article 11 https://www.wto.org/english/res_e/publications_e/ai17_e/dsu_art11_jur.pdf
[33]	Pimenova S. Reform of investment arbitration through the eyes of the European Union: problems and prospects // International Justice. 2018. No 4 (28). Pp. 113-125.
[34]	Remarks by Judge Stephen M. Schwebel “The proposals of the European Commission for investment protection and an Investment Court System”, May 17, 2016 http://isdsblog.com/wp-content/uploads/sites/2/2016/05/THEPROPOSALSOFTHEEUROPEANCOMMISSION.pdf
[35]	Working Group III: Investor-State Dispute Settlement Reform: Draft Working Papers for comments https://uncitral.un.org/en/working_groups/3/investor-state
[36]	Rachkov I. V., Magomedova O. S. Investment Court: review of the EU initiative. – Moscow Journal of International Law. 2019. No. 2. P. 54–69. DOI: 10.24833/0869-0049-2019-2-54-69.

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APA Style

Amina Akperlinova, Kasper Jastrzebski. (2022). Reforming Investor-state Dispute Settlement: The EU Multilateral Investment Court Perspective. Journal of Investment and Management, 11(1), 1-9. https://doi.org/10.11648/j.jim.20221101.11

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ACS Style

Amina Akperlinova; Kasper Jastrzebski. Reforming Investor-state Dispute Settlement: The EU Multilateral Investment Court Perspective. J. Invest. Manag. 2022, 11(1), 1-9. doi: 10.11648/j.jim.20221101.11

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AMA Style

Amina Akperlinova, Kasper Jastrzebski. Reforming Investor-state Dispute Settlement: The EU Multilateral Investment Court Perspective. J Invest Manag. 2022;11(1):1-9. doi: 10.11648/j.jim.20221101.11

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@article{10.11648/j.jim.20221101.11,
  author = {Amina Akperlinova and Kasper Jastrzebski},
  title = {Reforming Investor-state Dispute Settlement: The EU Multilateral Investment Court Perspective},
  journal = {Journal of Investment and Management},
  volume = {11},
  number = {1},
  pages = {1-9},
  doi = {10.11648/j.jim.20221101.11},
  url = {https://doi.org/10.11648/j.jim.20221101.11},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.jim.20221101.11},
  abstract = {Rapid changes to the global socio-political dynamics have led the emergence of new challenges to the investor-state dispute settlement (ISDS) mechanism. The imperfections of the existing ISDS system have shown a clear need for reforming this institution. Moreover, this is evidenced by the desire of a number of countries to create a multilateral investment court as proposed by the European Union. Will the new EU Multilateral Investment Court System be better than the current ISDS mechanisms? The Multilateral Investment Court System is the latest proposed measure in the context of multilateralism and the institutionalization of a decentralized international investment law regime. The success of the proposal will declare a new era for international investment law around the world. Still, the proposed reform of ISDS has both benefits and disadvantages. The main goal of this paper is to examine investor-state dispute settlement (ISDS) reform in the context of the EU Multilateral Investment Court by pointing out the shortcomings and rooms for improvement. In addition, this paper indicates that the MIC project has the greatest chance of support by majority of countries, as compared to other possible options for the proposed ISDS reform but at the same time, it has difficulties in achieving the goals of ISDS and fully realizing potential. The results of this research should help to proceed with smooth transition of the MIC to ISDS system and review issues for further discussion.},
 year = {2022}
}

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TY  - JOUR
T1  - Reforming Investor-state Dispute Settlement: The EU Multilateral Investment Court Perspective
AU  - Amina Akperlinova
AU  - Kasper Jastrzebski
Y1  - 2022/01/28
PY  - 2022
N1  - https://doi.org/10.11648/j.jim.20221101.11
DO  - 10.11648/j.jim.20221101.11
T2  - Journal of Investment and Management
JF  - Journal of Investment and Management
JO  - Journal of Investment and Management
SP  - 1
EP  - 9
PB  - Science Publishing Group
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UR  - https://doi.org/10.11648/j.jim.20221101.11
AB  - Rapid changes to the global socio-political dynamics have led the emergence of new challenges to the investor-state dispute settlement (ISDS) mechanism. The imperfections of the existing ISDS system have shown a clear need for reforming this institution. Moreover, this is evidenced by the desire of a number of countries to create a multilateral investment court as proposed by the European Union. Will the new EU Multilateral Investment Court System be better than the current ISDS mechanisms? The Multilateral Investment Court System is the latest proposed measure in the context of multilateralism and the institutionalization of a decentralized international investment law regime. The success of the proposal will declare a new era for international investment law around the world. Still, the proposed reform of ISDS has both benefits and disadvantages. The main goal of this paper is to examine investor-state dispute settlement (ISDS) reform in the context of the EU Multilateral Investment Court by pointing out the shortcomings and rooms for improvement. In addition, this paper indicates that the MIC project has the greatest chance of support by majority of countries, as compared to other possible options for the proposed ISDS reform but at the same time, it has difficulties in achieving the goals of ISDS and fully realizing potential. The results of this research should help to proceed with smooth transition of the MIC to ISDS system and review issues for further discussion.
VL  - 11
IS  - 1
ER  -

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Author Information

Amina Akperlinova

Guanghua Law School, Zhejiang University, Hangzhou, People’s Republic of China
Kasper Jastrzebski

Guanghua Law School, Zhejiang University, Hangzhou, People’s Republic of China

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APA Style

Amina Akperlinova, Kasper Jastrzebski. (2022). Reforming Investor-state Dispute Settlement: The EU Multilateral Investment Court Perspective. Journal of Investment and Management, 11(1), 1-9. https://doi.org/10.11648/j.jim.20221101.11

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ACS Style

Amina Akperlinova; Kasper Jastrzebski. Reforming Investor-state Dispute Settlement: The EU Multilateral Investment Court Perspective. J. Invest. Manag. 2022, 11(1), 1-9. doi: 10.11648/j.jim.20221101.11

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AMA Style

Amina Akperlinova, Kasper Jastrzebski. Reforming Investor-state Dispute Settlement: The EU Multilateral Investment Court Perspective. J Invest Manag. 2022;11(1):1-9. doi: 10.11648/j.jim.20221101.11

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@article{10.11648/j.jim.20221101.11,
  author = {Amina Akperlinova and Kasper Jastrzebski},
  title = {Reforming Investor-state Dispute Settlement: The EU Multilateral Investment Court Perspective},
  journal = {Journal of Investment and Management},
  volume = {11},
  number = {1},
  pages = {1-9},
  doi = {10.11648/j.jim.20221101.11},
  url = {https://doi.org/10.11648/j.jim.20221101.11},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.jim.20221101.11},
  abstract = {Rapid changes to the global socio-political dynamics have led the emergence of new challenges to the investor-state dispute settlement (ISDS) mechanism. The imperfections of the existing ISDS system have shown a clear need for reforming this institution. Moreover, this is evidenced by the desire of a number of countries to create a multilateral investment court as proposed by the European Union. Will the new EU Multilateral Investment Court System be better than the current ISDS mechanisms? The Multilateral Investment Court System is the latest proposed measure in the context of multilateralism and the institutionalization of a decentralized international investment law regime. The success of the proposal will declare a new era for international investment law around the world. Still, the proposed reform of ISDS has both benefits and disadvantages. The main goal of this paper is to examine investor-state dispute settlement (ISDS) reform in the context of the EU Multilateral Investment Court by pointing out the shortcomings and rooms for improvement. In addition, this paper indicates that the MIC project has the greatest chance of support by majority of countries, as compared to other possible options for the proposed ISDS reform but at the same time, it has difficulties in achieving the goals of ISDS and fully realizing potential. The results of this research should help to proceed with smooth transition of the MIC to ISDS system and review issues for further discussion.},
 year = {2022}
}

Copy | Download

TY  - JOUR
T1  - Reforming Investor-state Dispute Settlement: The EU Multilateral Investment Court Perspective
AU  - Amina Akperlinova
AU  - Kasper Jastrzebski
Y1  - 2022/01/28
PY  - 2022
N1  - https://doi.org/10.11648/j.jim.20221101.11
DO  - 10.11648/j.jim.20221101.11
T2  - Journal of Investment and Management
JF  - Journal of Investment and Management
JO  - Journal of Investment and Management
SP  - 1
EP  - 9
PB  - Science Publishing Group
SN  - 2328-7721
UR  - https://doi.org/10.11648/j.jim.20221101.11
AB  - Rapid changes to the global socio-political dynamics have led the emergence of new challenges to the investor-state dispute settlement (ISDS) mechanism. The imperfections of the existing ISDS system have shown a clear need for reforming this institution. Moreover, this is evidenced by the desire of a number of countries to create a multilateral investment court as proposed by the European Union. Will the new EU Multilateral Investment Court System be better than the current ISDS mechanisms? The Multilateral Investment Court System is the latest proposed measure in the context of multilateralism and the institutionalization of a decentralized international investment law regime. The success of the proposal will declare a new era for international investment law around the world. Still, the proposed reform of ISDS has both benefits and disadvantages. The main goal of this paper is to examine investor-state dispute settlement (ISDS) reform in the context of the EU Multilateral Investment Court by pointing out the shortcomings and rooms for improvement. In addition, this paper indicates that the MIC project has the greatest chance of support by majority of countries, as compared to other possible options for the proposed ISDS reform but at the same time, it has difficulties in achieving the goals of ISDS and fully realizing potential. The results of this research should help to proceed with smooth transition of the MIC to ISDS system and review issues for further discussion.
VL  - 11
IS  - 1
ER  -

Copy | Download