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Investor-State Dispute Settlement: A Scoping Paper for the Investment Policy Community


  • David Gaukrodger


  • Kathryn Gordon



Governments are facing an increasing number of arbitration claims by foreign investors relating to important public policies or seeking substantial damages, and many governments are taking a greater joint interest in how such cases are resolved in investor-state dispute settlement (ISDS). This scoping paper has supported inter-governmental dialogue about ISDS at several OECD-hosted investment Roundtable meetings. Part I compares ISDS with other international and domestic processes for resolving disputes including the WTO and European Court of Human Rights, and considers how ISDS may affect domestic policy making processes. Part II examines eight current and emerging issues in ISDS: (i) investors’ access to justice; (ii) the costs of ISDS cases; (iii) remedies for foreign investors under investment treaties and their possible impact on a level playing field for domestic and foreign investors; (iv) the enforcement and execution of ISDS awards; (v) third party financing of ISDS; (vi) the characteristics, selection and regulation of arbitrators in ISDS; (vii) forum shopping and treaty shopping by investors; and (viii) the question of the consistency of decision-making in ISDS. Part III outlines key findings from a statistical survey of ISDS provisions in 1,660 bilateral investment treaties. Public comment on this paper, including 46 investment policy questions (as outlined in the paper), was obtained in May-July 2012 and is available on the OECD website.

Suggested Citation

  • David Gaukrodger & Kathryn Gordon, 2012. "Investor-State Dispute Settlement: A Scoping Paper for the Investment Policy Community," OECD Working Papers on International Investment 2012/3, OECD Publishing.
  • Handle: RePEc:oec:dafaaa:2012/3-en
    DOI: 10.1787/5k46b1r85j6f-en

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    Cited by:

    1. Fritz Breuss, 2014. "TTIP und ihre Auswirkungen auf Österreich. Ein kritischer Literaturüberblick," WIFO Working Papers 468, WIFO.

    More about this item


    access to justice; arbitration costs; arbitrators; bilateral investment treaties; comparative law; comparative remedies; competitive neutrality; consistency of arbitral decisions; dispute resolution; dispute settlement; domestic impact of investment law; ECHR dispute settlement; enforcement of arbitration awards; foreign investment; forum shopping; treaty shopping; international arbitration; international economic law; international investment; international investment agreements; international investment law; investment arbitrators; investment law and development; investment treaties; investor-state dispute settlement; judicial review; level playing field; litigation finance; non-pecuniary remedies; remedies; selection and regulation of arbitrators; third party financing; third party funding; WTO dispute settlement;

    JEL classification:

    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • F02 - International Economics - - General - - - International Economic Order and Integration
    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • F53 - International Economics - - International Relations, National Security, and International Political Economy - - - International Agreements and Observance; International Organizations
    • F55 - International Economics - - International Relations, National Security, and International Political Economy - - - International Institutional Arrangements
    • F63 - International Economics - - Economic Impacts of Globalization - - - Economic Development
    • G23 - Financial Economics - - Financial Institutions and Services - - - Non-bank Financial Institutions; Financial Instruments; Institutional Investors
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
    • K23 - Law and Economics - - Regulation and Business Law - - - Regulated Industries and Administrative Law
    • K33 - Law and Economics - - Other Substantive Areas of Law - - - International Law
    • K41 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Litigation Process
    • L84 - Industrial Organization - - Industry Studies: Services - - - Personal, Professional, and Business Services
    • P45 - Economic Systems - - Other Economic Systems - - - International Linkages


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