Multilateral Reform of Investor–State Dispute Resolution Mechanism: A Balance between Public Legitimacy Management and Private Efficiency Refinement

Shan, Su & Zhang (eds.), China and International Dispute Resolution in the Context of the “Belt and Road Initiative” (Cambridge University Press, 2020) pp 149-184

36 Pages Posted: 16 Feb 2022

See all articles by Peng Wang

Peng Wang

Xi'an Jiaotong University School of Law

Date Written: December 13, 2020

Abstract

The Investor-State Dispute Settlement (ISDS) system comes at crossroad. In context of ISDS reform, the Public-Private Debate surrounding international investment agreements (IIAs) could be specified as a balance between public legitimacy and private efficiency, tempering tensions between fast and fair resolution of investment disputes. From the perspective of fast resolution, party autonomy and cost management of the ISDS system should be retained and refined. From the perspective of fair resolution, ex ante (in-put) legitimacy and ex post (out-put) legitimacy should be enhanced to manage the procedural and substantive deficits, by establishment of state’s appointed arbitrator-roster and restricted review of awards by a permanent annulment committee. Therefore, this article proposes a Chinese perspective on Multilateral Investment Dispute Resolution (MIDR) system of balance between public legitimacy management and private efficiency refinement. The institutional structure of MIDR should be of internal balance, moderating three tensions between state and arbitrator, between investor and host state, and between state and arbitral tribunal during ex ante and ex post process of dispute resolution. The process of establishment of MIDR should be of external balance, moderating tensions between procedure and substance of MIDR, between MIDR and existing institutions, and between legal rights of MIDR stakeholders and political will of leading states.

Keywords: Multilateral Investment Dispute Resolution, Investor-State Dispute Settlement, Public Legitimacy, Private Efficiency, Public-Private Debate

Suggested Citation

Wang, Peng, Multilateral Reform of Investor–State Dispute Resolution Mechanism: A Balance between Public Legitimacy Management and Private Efficiency Refinement (December 13, 2020). Shan, Su & Zhang (eds.), China and International Dispute Resolution in the Context of the “Belt and Road Initiative” (Cambridge University Press, 2020) pp 149-184, Available at SSRN: https://ssrn.com/abstract=4033635 or http://dx.doi.org/10.2139/ssrn.4033635

Peng Wang (Contact Author)

Xi'an Jiaotong University School of Law ( email )

28 Xianning West Rd.
咸宁西路28号西安交通大学法学院
Xi'an, Shaanxi 710049
China

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