Australia and the Backlash Against Investment Arbitration

Abstract

One of the major developments in international law in the past century has been the rapid expansion of foreign investment law. Historically, investors had few effective legal mechanisms to protect their property in a foreign state. This changed in the 20th century with the proliferation of international investment treaties, guaranteeing foreign investors certain levels of protection. But something has changed in recent years. Increasingly, states are rejecting ISDS in what has come to be known as the ‘backlash’ against investment arbitration. Recently, Australia became the first developed country to announce that it would no longer include investor-state arbitration clauses in its future international investment treaties. This article briefly examines the debate surrounding the debate surrounding that policy decision.

Keywords: foreign investment law, investor-state dispute settlement, investor-state arbitration, investment treaty disputes, arbitration