Political Dimensions of Investment Arbitration: ISDS and the TTIP Negotiations
29 Pages Posted: 11 Feb 2015
Date Written: February 10, 2015
The aim of this paper is to explore the political dimensions of investment arbitration. What drives the structures and rules of this institution of private-transnational dispute settlement? To define political dimensions and develop the basis of a political explanation of investment arbitration, we reconstruct the conflict about investor-state dispute settlement (ISDS) in the negotiations on the Transatlantic Trade and Investment Partnership (TTIP). We argue that the competing interests of different actors shape the design of the institution. Investment arbitration has become politicized. On a horizontal dimension, interest groups argue about the risks and benefits of arbitration. On a vertical dimension, government authorities struggle to balance national sovereignty and global interests. We indicate a political process, defined by the configuration of the horizontal and the vertical dimension, which drives the emergence and development of investment arbitration.
Keywords: Arbitration, investor-state dispute settlement, TTIP, politicization, distributional conflicts
JEL Classification: F13, F15, F21, K33, P16
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