Anyone with a serious interest in investment arbitration cannot have avoided the long-running discussion regarding its legitimacy. Depending on how the starting date is selected, this debate has now gone on for at least 25 years, with no end in sight. The discussion has, without doubt, produced a number of serious proposals for reform, some of which have already been implemented.
But in speaking with a number of colleagues who have served as arbitrators in investment cases, I find their reactions to the legitimacy discussion (notwithstanding critiques from outstanding scholars in the field) to be basically, that much of the criticism reflects either ideological bias or ignorance of how the process works in practice. For better or for worse, it seems that the discussion, at this point, focuses principally on ways to expand the number and diversity of those serving as arbitrators and various proposals for unifying international investment law through a new appellate body or the creation of one or more permanent investment arbitration courts. Though these proposals are certainly worth serious thought, my impression is that they do not sufficiently credit the achievements of the existing international investment regime or its sophistication in resolving international investment disputes.
With new ICSID and other investment cases being filed in record numbers, one may justifiably wonder why the legitimacy discussion continues with such considerable intensity. Might there be deeper issues, which, if brought to the surface, would ameliorate the negative reactions of some parties, especially certain governments, to the investment arbitration process?