The paper discusses competing positions and arguments of main European actors in the debate on the Investment Court System (ICS). The European Commission pushes for the ICS to replace investor-state arbitration, in bilateral agreements (such as EVFTA and CETA), as well as a future multilateral solution. The ICS mechanism is meant to remedy legitimacy deficits of arbitration and to secure leading role of the EU in designing investment protection standards. Meanwhile, some of the civic society organizations see the EU law as a useful tool to oppose investment protection systems. A judicial review of CETA in Opinion 1/17 creates a possibility for arguing that ICS infringes the principles of equal access to justice and the autonomy of EU law. The Court of Justice has its own agenda in this matter as, in upholding the adjudicatory autonomy, it acts both for the preservation of its role as the ultimate umpire in the EU and, arguably, for the strengthening of the EU itself.
In the EU-Vietnam FTA (EVFTA) the typical investor-State dispute settlement mechanism has been replaced with a different, new model. The paper will sketch out the main differences between the two mechanisms and suggest where the Vietnam government may expect certain difficulties with implementation of the new system. Moreover, the EVFTA mechanism is intended to be a mere first step toward a multilateral investment tribunal system (cf. EVFTA Article 8.31). In addition, EVFTA continues to permit the investor to challenge the Host state directly, and on the other hand restricts the Home state’s involvement in the process. Actually, the participation of Home State in ISDS in EVFTA is much wider than any bilateral treaties. They can receive documents from the proceedings and participate in the oral hearing. Whereas the basic investor-State dispute framework is continued, the institutional structure differs from the arbitration model.
This paper focuses on the new rules on qualifications of, and ethics applicable to, the members of investment tribunals to be established under the investment chapters of various free trade agreements (FTAs), such as the CETA the TTIP proposal, and EU – Vietnam FTA. This paper first seeks to identify whether the rules live up to their promise of fostering “trust” among stakeholders. To this end, the paper focuses on ‘legitimacy’ as an operative concept. Second, it seeks to understand how the EU seeks to replace the soft law framework currently in place. It will specifically scrutinize the binding nature of the new rules, as well as their compatibility within the context of permanent, appointed judges. It will examine whether they offer clarity in light of appointment and practice of arbitrators. To that end, the research will additionally benefit from previous scholarly and empirical work on actors in international investment law such as legal counsel, arbitrators and expert witnesses.