The reform of the ISDS has continued to be a subject of debate at various fora. Whether it is UNCITRAL Working group, the rescinding of BITs, re-envisioning investment treaties, the EU Multilateral Appellate court proposal or just reforms in iSDS procedures to make it more palatable.
Nicholas Diamond and Kabir Duggal have written about ISDS reform and human rights considerations in this blog piece. Human rights considerations have been aligned to the SDGs, ensuring more transparency, avoiding regulatory chill and third party participation. The focus now on ISDS reforms are now on procedural fairness and transparency rather than socio-economic rights of third parties or the need for policy autonomy of States.
With the Appellate Body of the WTO is a precarious state, would the multilateral appellate mechanism for investment disputes offer any solace? Yes, they are different eco-systems - but to some the appellate process that has been a complete failure at the WTO may not offer solutions in the investment arena. Further, many States are arguing for doing away with ISDS and adopt a more State to State or co-operation oriented investment framework for international investments. How does that fit into the ISDS reform agenda?
The question is to what degree of reform in the current ISDS framework, both procedural and substantive, would satisfy the naysayers? Also, to what extent would States adopt non-traditional investment dispute models - State to State or otherwise? Today, developing countries are also becoming exporters of FDI. Would this influence the way they look at ISDS and its benefits?
Also, how is literature relating to the impact of investment treaties on FDI shape State's attitude towards negotiating positions. Some argue there is no sufficient co-relation or at best a weak one between strong ISDS provisions and foreign direct investment. Other factors like political stability, investment climate, existence of supply chains and the general domestic environment is far more important.
Nicholas Diamond and Kabir Duggal have written about ISDS reform and human rights considerations in this blog piece. Human rights considerations have been aligned to the SDGs, ensuring more transparency, avoiding regulatory chill and third party participation. The focus now on ISDS reforms are now on procedural fairness and transparency rather than socio-economic rights of third parties or the need for policy autonomy of States.
Looking ahead, the future for second- and third-generation rights in ISDS reform efforts remains uncertain. The procedurally-driven reforms provide a sound foundation for subsequent development of substantive rights beyond the civil and political rights that have historically predominated ISDS. Yet without attention afforded to second- and third-generation rights in reform efforts, resultant pressure is placed on other avenues for raising such considerations including, inter alia, modification of investment treaties. States play a critical role in this process and can support alignment between procedurally-driven reform efforts and substantive provisions in investment agreements and policies. If the ISDS system is to evolve to better recognize human rights considerations, then reform efforts must provide for a foundation that envisions all generation of rights.
With the Appellate Body of the WTO is a precarious state, would the multilateral appellate mechanism for investment disputes offer any solace? Yes, they are different eco-systems - but to some the appellate process that has been a complete failure at the WTO may not offer solutions in the investment arena. Further, many States are arguing for doing away with ISDS and adopt a more State to State or co-operation oriented investment framework for international investments. How does that fit into the ISDS reform agenda?
The question is to what degree of reform in the current ISDS framework, both procedural and substantive, would satisfy the naysayers? Also, to what extent would States adopt non-traditional investment dispute models - State to State or otherwise? Today, developing countries are also becoming exporters of FDI. Would this influence the way they look at ISDS and its benefits?
Also, how is literature relating to the impact of investment treaties on FDI shape State's attitude towards negotiating positions. Some argue there is no sufficient co-relation or at best a weak one between strong ISDS provisions and foreign direct investment. Other factors like political stability, investment climate, existence of supply chains and the general domestic environment is far more important.
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