Rebalancing Investment Treaties: Implications of the New Mechanisms Proposed by the ISDS Reform

by International and Comparative Law Research Center (ICLRC)

In recent years, states have redefined their approach to investment treaties, seeking to strike a better balance between investor protection and their right to regulate in the public interest by including stronger provisions on the right to regulate. States are also asserting greater control over treaty interpretation, using joint interpretative declarations to guide arbitral tribunals and prevent the interpretation contrary to the parties’ intentions.

UNCITRAL Working Group III plays an important role in these efforts. The Working Group is leading an ISDS reform to enhance the consistency, correctness, predictability, and coherence of arbitral awards and to strengthen the legitimacy of the ISDS system. Among the elements of the reform, the Working Group is considering provisions on the right to regulate, counterclaims, and interpretation mechanisms as key tools to rebalance investment treaties and give states sufficient freedom to regulate in the public interest and hold investors accountable for possible violations.

During the event, renowned expert practitioners will explore these mechanisms and the creation of a more balanced dispute resolution framework for both states and investors.