POTENTIAL REFORMS OF INTERNATIONAL INVESTMENT ARBITRATION FRAMEWORK: IS INCORPORATING A COLLECTIVE APPEAL PROCEDURE FUNDAMENTAL?

Abstract

Abstract Majority of the investment disputes between host countries and foreign investors are currently resolved using investment arbitration platforms. These arbitration procedures are not undertaken by one independent body but rather conducted by several different bodies such as ad hoc tribunals and permanent arbitral institutes. Despite using similar treaty provisions and law principles to make rulings, these diverse arbitral institutions often make conflicting decisions that are usually conclusive and binding. This happens because both stare decisis and binding precedent are not applied in international investment arbitral sphere. Conflicting decisions and awards issued by the tribunals causes the issue of consistency and erroneous decisions in IIAs. As a way of addressing this issue, scholars and experts have put across a number of restructurings to the current IIAs. One major reform is the incorporation of an appeal procedure into the system. The major objective of this study is to examine in detail the establishment of an appeal procedure. This study majors in the discussion about the possible incorporation of the appeal procedure, examines the nature of the current IIAs, explores the strengths and weaknesses of an appeal mechanism, and major ways of implementing the appeal mechanism, and answer the question whether it is necessary to have an appeal procedure in the current system. The study submits that the reasons made for the establishment of an appeal procedure are valid, although the there are other better alternatives to appeal procedure as a way to avoid inconsistent rulings and therefore incorporating an appeal procedure in not a fundamental strategy