The European Union's Proposal for an International Investment Court: Significance, Innovations and Challenges Ahead
Résumé
Rampant discontent with the current system that governs the protection of international investment and the functioning of investment tribunals has led to a widespread view that there is an urgent need for reform. This is particularly pronounced in the context of investor-state dispute settlement (ISDS). The European Union (EU) has responded to this need by proposing the creation of an international investment court. With its political weight, the EU confers unprecedented legitimacy on the critics of the current ISDS system and reveals investment dispute settlement in the light of public international law, breaking with its background in commercial litigation. The article explores the creation of an international investment court on the basis of the EU's proposal for the Transatlantic Trade and Investment Partnership (TTIP), but also in light of the EU-Canada Comprehensive Economic and Trade Agreement (CETA) and the EU-Vietnam FTA, focusing on its significance, innovative provisions, and projected impact on the existing system of investment dispute settlement. It argues that the international investment court constitutes a brave initiative and an innovative reform proposal for ISDS. But the proposal also leaves open questions and challenges remain. These need to be tackled in order to avoid affecting the court's 'legal feasibility' and prospective functioning, and the article proposes steps that can help address these issues. For several decades, investor-state dispute settlement has been synonymous with investment arbitration. The EU proposal adds a different layer to ISDS, revealing the flip-side of the same coin, what may turn out in the future to be investment trial.