Professor Bermann left investor-state dispute settlement (ISDS) out of his interesting discussion in “What Does it Mean to Be ‘Pro-Arbitration’?,” calling it too politicized. Perhaps lacking the prudence of my professor, I’ll try to grab the hot potato and take his argument to ISDS. In fact, his conclusion that “acknowledging legitimacy—measured in terms of extrinsic values—as in itself a pro-arbitration attribute may be among the most arbitration-friendly moves one can make” applies with special force to ISDS. And, “[t]he present time … is an especially apt moment” to make this ISDS-friendly move.
I. WHAT “PRO-ISDS” DOES NOT MEAN
Let us start by clearing out what it does not mean to be pro-ISDS. First, it does not mean being pro-dispute. To be sure, the marked growth in caseload this century has made ISDS the industry it is today. But one need not wish to see disputes to support ISDS—any more than building a commercial, constitutional, or criminal court reveals support for those kinds of cases. Disputes are a fact of life and it makes sense to build sound dispute resolution systems.
Second, being pro-ISDS does not mean being for any particular rules. Investment treaties have changed remarkably since 1959, adding both investor rights and state defenses among numerous other provisions. They continue to change. One can support ISDS while opposing, for example, indirect expropriation or damages based on expected earnings. Similarly, one may prefer the transparency of the International Centre for Settlement of Investment Disputes (ICSID) or the rule on arbitrator immunity of the London Court of International Arbitration (LCIA). Let each debate proceed on its own merits.