INVESTMENT ARBITRATION AS A CONTRIBUTION TO THE NATIONAL RULE OF LAW

Abstract

Investment arbitration has an enormous potential to enhance the rule of law at the national level, provided that the atomized investment tribunals network foregoes the perilous task of attempting to singlehandedly build ‘new administrative law’ on the international plane or to consider exercise of broad discretion as a normatively satisfactory type of reasoning in awards. Arbitral decision-making should thus turn its normative focus. A national legal system and the rule of law is generally a more immediate concern for a foreign investor and arguably far more relevant for the attraction of foreign direct investment in the long term. The contribution to its enhancement in addition to providing piecemeal protection is thus a more complete and legitimate pursuit of international investment agreements’ aims, in addition to other incidental benefits.