A Latin American Approach to Investor-State Dispute Settlement (ISDS) reform

It is now a commonplace to argue that ISDS is currently going through a legitimacy crisis. Whilst the critique against ISDS has extended throughout the globe the origins of such critique can be traced to Latin America. This paper shows how Latin American States are finding novel ways to reform ISDS. It goes beyond false dichotomies and reflects upon the realities of ISDS reform. Three factors play into such an argument. First, Latin America is the biggest client of ISDS. A majority of ISDS claims have targeted Latin American States. Second, the biggest backlash against the current state of affairs in ISDS has come from Latin American States. Third, the new generation of investment agreements concluded by Latin American Sates are already taking into account the systemic deficiencies that led to the crisis and providing innovative solutions that, not surprisingly, are being downplayed at the multilateral level.