Against Consistency in Investment Arbitration
The Foundations of International Investment Law: Bringing Theory into Practice, Z. Douglas, J. Pauwelyn, and J.E. Viñuales (eds.) (OUP 2014).
20 Pages Posted: 30 Aug 2013 Last revised: 18 Jun 2015
Date Written: August 30, 2013
Consistency in decision-making is generally considered to be a good thing. It is largely considered to be a paradigm of good decision-making. Investment arbitrators often rely on this idea to cite prior cases (precedents, in a non-technical meaning), and follow some of them. But is consistency really such a good thing? Is it actually unconditionally a good thing - always and in any context a good thing? Could it not be that, in fact, the pursuit of consistency does more harm than good - not in a single case, where the question is fairly obvious, but at the level of an entire dispute resolution system? The author argues that, indeed, consistency is not an unconditional positive, just as the rule of law and law itself are not an unconditional positive. And in the context of investment arbitration, there are reasons why we may believe that the conditions for consistency to be a good thing are actually not met: in investment arbitration the pursuit of consistency may well do more harm than good.
It follows that investment arbitrators should not see themselves as law-makers, should not attempt to advance the rule of law, to consolidate rules. There is a high risk that as law-makers they do more harm than good, given that creating law, filing gaps, furthering the rule of law, pursuing predictability is not always a good thing to do. Precise, consistent rules, forming a regime that meets the requirements of the rule of law, are not inherently preferable to vague, inconsistent rules forming a regime that does not meet the standards of regulative quality which partake of the rule of law. There is nothing inherently good in furthering the rule of law.
Keywords: investment arbitration, international investment law, rule of law, jurisprudence
JEL Classification: K33
Suggested Citation: Suggested Citation