9 Legitimacy and Governance Challenges

Subject(s):

Definition of investment — Investor — Transparency — Treaties, interpretation — Treaty provisions

The rapid growth of investment treaty arbitrations in often sensitive policy areas has focused public attention on the investment treaty regime. This chapter draws together several strands of the book to focus on two central debates about legitimacy and governance challenges facing the investment treaty regime. The first section considers the impact of investment treaties on national governance. It assesses criticisms that investment treaties unduly fetter democratic decision-making and discourage states from regulating in the public interest. The second section examines the legitimacy of investment treaty arbitration—the regime feature that has come under the closest scrutiny over the last decade. It assesses debates about transparency and consistency in investment treaty arbitration, its impact on the broader investment regime complex, the selection, identity, and alleged biases of arbitrators, as well as the lack of investor obligations.