By empowering investors to sue states, the world’s web of 3,000-plus investment treaties has made arbitration the dominant form of dispute resolution involving states. Supporters make a strong case that it has promoted the rule of law and the flow of investment.
The greatest weakness of the treaty system is the appearance of bias. Alas, the critiques of arbitrator independence have gone unheeded, and they are only growing louder. A study by the system’s leading academic critic, Gus Van Harten of Toronto’s Osgoode Hall Law School, concluded that treaty arbitrators find in favor of investors on key jurisdictional issues about three-quarters of the time.
