The proposed Investment Court System: does it really solve the problems?
| Autor | Juan Pablo Charris Benedetti |
| Páginas | 83-115 |
Revista Derecho del Estado n.º 42, enero-abril de 2019, pp. 83-115
JUAN PABLO CHARRIS BENEDETTI*
The proposed Investment Court System:
does it really solve the problems?**
La propuesta de un Sistema de Corte
de Inversiones: ¿realmente resuelve
los problemas?
ABSTRACT
In recent years, the foreign investment regime has been subject to an increas-
ing volume of criticism from the public. The significant sums of money at
stake and the potential impact of the awards on State’s regulatory powers
have placed the Investor-State Dispute Settlement (isDs) under the spotlight.
In response to this, the European Union has proposed a far-reaching reform
which introduces an Investment Court System (iCs). This model constitutes
an innovative dispute settlement mechanism intended to address most of the
core issues of the isDs by combining elements of the traditional isDs with
judicial features. Overall, this paper aims at analysing whether the EU’s
new approach constitutes an effective improvement to the traditional isDs
and the future of the international investment regime. To achieve this, the
study begins with an overview of the current isDs; followed by a synopsis of
the main criticisms to the traditional isDs; proceeded by a review of the core
features of the EU’s proposed iCs and its inclusion in the new generation of
iias in negotiation by the EU; and finally, provides a commentary of the main
criticisms and obstacles that the introduction of the iCs is likely to encounter.
KEYWORDS
Investment Court System (iCs), Investor-State Disputes Settlement (isDs),
Foreign Direct Investment (FDi), International Investment Agreement (iia),
* LL.M. (Master of Laws) en Resolución de Disputas Internacionales de King’s College
London. Magíster en Gobierno y Políticas Públicas de la Universidad Externado de Colombia.
Abogado de la Universidad Externado de Colombia. Investigador independiente. Londres, In-
glaterra. Contacto: juanpablo.charris@gmail.com
** Recibido el 11 de septiembre de 2017, aprobado el 4 de abril de 2018.
Para citar el artículo: Charris BeneDetti, J. P. The proposed Investment Court System: does it
really solve the problems? En Revista Derecho del Estado, Universidad Externado de Colombia.
N.º 42, enero-abril de 2019, pp. 83-115.
Doi: https://doi.org/10.18601/01229893.n42.04
84 Juan Pablo Charris Benedetti
Revista Derecho del Estado n.º 42, enero-abril de 2019, pp. 83-115
Comprehensive Economic and Trade Agreement (Ceta), Transatlantic Trade
and Investment Partnership (ttip).
RESUMEN
En los últimos años, el régimen de inversión extranjera ha sido objeto de un
creciente número de críticas del público. Las sumas significativas de dinero
en juego y el posible impacto de los laudos en los poderes regulatorios del
Estado han puesto al actual Sistema de Resolución de Controversias entre
Inversores y el Estado bajo la lupa. En respuesta a ello, la Unión Europea
ha propuesto una reforma de gran alcance mediante la introducción de un
Sistema de Corte de Inversiones (sCi). El nuevo sistema constituye un me-
canismo innovador de resolución de controversias internacionales destinado
a remediar los problemas centrales que acarrea el sistema actual, mediante la
combinación de elementos tradicionales del arbitraje con rasgos judiciales.
En este contexto, el presente escrito pretende analizar si el nuevo enfoque
de la Unión Europea constituye una mejora efectiva del actual mecanismo
de resolución de controversias de inversiones y del futuro del régimen de
inversión internacional. Para dicho propósito, el artículo comienza con una
descripción general del actual Sistema de Resolución de Controversias entre
Inversores y el Estado; seguido de una sinopsis de sus principales críticas;
continúa con un resumen de las principales características del Sistema de
Corte de Inversiones, así como de su inclusión en la nueva generación de
acuerdos internacionales de inversión en negociación por la Unión Europea; y,
finalmente, hace una referencia a las principales críticas y posibles obstáculos
que afrontará la introducción del nuevo Sistema de Corte de Inversiones.
PALABRAS CLAVE
Sistema de Corte de Inversiones, Sistema de Resolución de Controversias
entre Inversores y el Estado, Inversión Extranjera Directa, Acuerdos Inter-
nacionales de Inversión, Acuerdo Económico y Comercial Global (aeCG),
Asociación Transatlántica de Comercio e Inversión.
CONTENT
Introduction. 1. An overview of the isDs. 1.1. The early years. 1.2. The foreign
investment regime. 1.3. Rules and institutions. 1.4. Main features of the isDs.
2. Criticism to the isDs. 2.1. Lack of consistency. 2.2. Lack of impartiality.
2.3. Lack of transparency. 3. The introduction of the iCs. 3.1. The EU’s new
investment policy. 3.2. The core institutional features of the iCs. 3.3. The
venture towards a Multilateral Investment Court System. 4. Criticism to the
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The proposed Investment Court System: does it really solve the problems?
Revista Derecho del Estado n.º 42, enero-abril de 2019, pp. 83-115
iCs. 4.1. Re-politicisation. 4.2. Quality of the decision-making. 4.3. Finality,
efficiency and costs. 4.4. Enforceability. Conclusions. References.
INTRODUCTION
Contemporary international investment agreements tend to articulate substan-
tive standards of protection that confer foreign investors the right to bring
claims against sovereign States before international arbitral tribunals. This
mechanism of dispute resolution is known as investor-state-dispute settle-
ment (isDs).
Nevertheless, in recent years, the legitimacy of the isDs has been subject to
numerous criticisms. In this context, critics seek for structural reforms to the
system, while supporters of the status quo advocate for the need to maintain
the core elements of the system with some amendments.
Some of the critiques to the isDs stem from tribunals rendering contra-
dictory decisions, the potential conflict of interest of individuals acting as
counsellors and arbitrators in similar cases, and the apparent detriment of
democratic institutions in favour of private interests. However, although
previous attempts to reform have been dismissed as premature and politically
challenging, recent developments within the European Union (EU) have
gained momentum in favour of a major shift in the system, encouraged by
the adoption of a permanent court system for the resolution of investment-
related disputes.
Thus, the present study is based upon the EU’s proposal for the introduc-
tion of an Investment Court System (iCs), analysed both from an institutional
and a procedural perspective. In this sense, the goal is to determine whether
the implementation of the iCs – as proposed by the EU for the Transatlantic
Trade and Investment Partnership (ttip), already included in the EU-Vietnam
Free Trade Agreement and the EU-Canada Comprehensive Economic and
Trade Agreement (Ceta), and more recently in the EU-Singapore Investment
Protection Agreement and the EU-Mexico Trade Agreement, and currently
subject to bilateral negotiation in the EU-Japan Economic Partnership Agree-
ment – constitutes an improvement to the current isDs.
For this purpose, the paper is divided into four complementary sections:
first, (1) an overview of the current isDs; second, (2) a synopsis of the main
criticisms to the traditional isDs; third, (3) an outline of the core features of
the EU’s proposed Investment Court System; and, finally, (4) a reference
to the main criticisms and obstacles that the introduction of the iCs is likely
encounter.
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