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The Investor-State Dispute Settlement Mechanism: Where to Go in the 21st Century?

The Investor-State Dispute Settlement Mechanism: Where to Go in the 21st Century? I. INTRODUCTION Traditionally, investment disputes between foreign investors and host countries were resolved in the local courts of host countries since many developing countries insisted on the Calvo Doctrine. However, developed countries tried to protect their overseas investors by resolving investor-state investment disputes in the international arena through diplomatic protection or international arbitration. They insisted that investor-state dispute settlement provisions, such as international arbitration by the International Centre for Settlement of Investment Disputes (ICSID), be inserted into investment treaties, including bilateral investment treaties (BITS) and free trade agreements (F'r'ns) signed with developing countries. Since the 1980's, more and more developing countries have deviated from their traditional conservative position and have increasingly accepted highly protective investor-state dispute settlement mechanisms (ISDSMS) in BITS or F'rAS with both developed and developing countries. The highest protective ISDSM is that of the North America Free Trade Agreement (NAFTA). In the last decade, some developing countries - such as Argentina and Mexico - were confronted by a number of investment lawsuits filed by foreign investors and thus realized the serious problems arising from highly protective ISDSMS. Therefore, developing countries began restricting or withdrawing from the jurisdiction of ICSID. At the same time, the United http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of World Investment and Trade Brill

The Investor-State Dispute Settlement Mechanism: Where to Go in the 21st Century?

Journal of World Investment and Trade , Volume 9 (6): 30 – Jan 1, 2008
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References (3)

Publisher
Brill
Copyright
Copyright © Koninklijke Brill NV, Leiden, The Netherlands
ISSN
1660-7112
eISSN
2211-9000
DOI
10.1163/221190008X00241
Publisher site
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Abstract

I. INTRODUCTION Traditionally, investment disputes between foreign investors and host countries were resolved in the local courts of host countries since many developing countries insisted on the Calvo Doctrine. However, developed countries tried to protect their overseas investors by resolving investor-state investment disputes in the international arena through diplomatic protection or international arbitration. They insisted that investor-state dispute settlement provisions, such as international arbitration by the International Centre for Settlement of Investment Disputes (ICSID), be inserted into investment treaties, including bilateral investment treaties (BITS) and free trade agreements (F'r'ns) signed with developing countries. Since the 1980's, more and more developing countries have deviated from their traditional conservative position and have increasingly accepted highly protective investor-state dispute settlement mechanisms (ISDSMS) in BITS or F'rAS with both developed and developing countries. The highest protective ISDSM is that of the North America Free Trade Agreement (NAFTA). In the last decade, some developing countries - such as Argentina and Mexico - were confronted by a number of investment lawsuits filed by foreign investors and thus realized the serious problems arising from highly protective ISDSMS. Therefore, developing countries began restricting or withdrawing from the jurisdiction of ICSID. At the same time, the United

Journal

Journal of World Investment and Trade – Brill

Published: Jan 1, 2008

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