Originally from The American Review of International Arbitration (ARIA)

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In this article, I explore the policy choices the EU is facing and has taken in the discussion on the reform of investor-state dispute settlement (ISDS), and substantive investment law.  My main argument, is that, from an observer’s perspective, the EU is taking a moderate position in its reform initiatives, which on occasion stands in contrast to certain official statements and some of the results of the “public consultation” discussed above. The position of the EU can be explained by various rationales, the most important one being that the EU is representing Member States that have a mixed profile, and a continued belief in the usefulness of IIAs to provide both for investment protection and access to an international dispute settlement method. To be clear, I am not taking any position in this article on whether the reform proposals are necessary or not, nor do I pass any judgement on the reform proposals (whether from the EU or not).

I will first discuss the origins of the EU’s quest for procedural reform including the creation of a multilateral investment court (MIC), and the ongoing debates before UNCITRAL WG III (2). I will next analyze the reform of substantive investment law in the EU’s treaty practice (3). Finally, I will attempt to rationalize the position adopted by the EU, based on the position papers and policy documents which are guiding the EU, and the diverging influences guiding its reform agenda, arguing, as said, that the EU is more prudently engaging in reforms than might appear from certain statements made.