Private Rights and Public International Law: Why Competition Among International Economic Law Tribunals is Not Working

Abstract

It is a buyer's market for foreign investors seeking remedies for wrongs they have allegedly suffered at the hands of host governments. They can usually seek relief in the courts of the host state, but, increasingly, they also have more cosmopolitan options to consider, including investor-state arbitration based on violations of one or more investment treaties. This competition for business is not, contrary to expectation, advantageous to investors or the world community. First, competition is to some extent illusory: available remedies and jurisdictional authority are often so fragmented among tribunals that a claimant must seek relief in multiple fora in order to be made whole. Second, the possibility of bringing duplicative cases brings disrepute to international dispute settlement mechanisms without corresponding advantages in innovation, quality, or efficient allocation of resources. These problems are exacerbated by the fact that tribunals lack the means (such as the traditional conflict of laws analysis used by municipal courts) to coordinate proceedings when their jurisdictions overlap with those of other tribunals. This incapacity will persist until public international law principles adapt to reflect a pluralistic legal order. Achieving more coordination among tribunals requires revisiting the historic division between states and individuals in international law. Individuals will need to have recognized status and be treated as third-party beneficiaries of such treaties, rather than as owners of derivative rights, to effect this change. Such theoretical advances will permit a desirable coordination, and ultimately a harmonization of effort, among tribunals in the international economic law sphere and beyond.

Keywords: international economic law, international investment law, investment arbitration, international courts and tribunals, international litigation, international trade

JEL Classification: F00, F02, F10, F21, K33