Despite the original objective of investor state dispute settlement (“ISDS”)—to create an unbiased arbitration mechanism to resolve conflicts between states and foreign investors—ISDS tribunals have gained the reputation of being one-sided, nontransparent, and inconsistent in decisions rendered. A major reform proposed to address the criticism of ISDS is the creation of one permanent tribunal, rather than numerous ad hoc tribunals constituted separately for each investment dispute. Discussion of ISDS reform in light of its historical context poses the question: is ISDS really a broken system, or have our global priorities and concerns changed over time? While improvements can be made, the current ISDS system is still faithfully serving its original purpose as a neutral tribunal where disputes can be arbitrated. In contrast, the creation of a permanent investment tribunal may thwart the principles envisioned for ISDS at its inception, most importantly, the balance between the protection of state sovereignty and the recognition of the investor as an autonomous private entity. This comment discusses a permanent court solution to international investment disputes in light of the European Council’s 2018 directive authorizing the European Commission to negotiate, on behalf of the European Union, a convention to establish a permanent body to settle investment disputes called the multilateral investment court (“MIC”). It compares the proposed MIC with the structure of the permanent investment tribunal, known as the Investment Court System, contemplated by the Comprehensive Economic and Trade Agreement. Ultimately, this comment concludes that ISDS tribunals can address many concerns through reform to the existing ad hoc system without requiring permanency, thus continuing to respect the original aims of the ISDS system and to foster international investment.
* J.D. Candidate, 2019, University of Richmond School of Law. B.A., 2014, Christopher Newport University. I am grateful to Professor Chiara Giorgetti for her thoughtful comments on my draft, and to Emma Greger and the rest of the University of Richmond Law Review staff for their time and effort spent ensuring this comment was ready for publication.