Third-Party Funding in Investment Treaty Arbitration: Revisiting the Findings of the ICCA-Queen Mary Task Force

Abstract

The emergence of third-party funding in investor-state dispute settlement adds to the problems and challenges already facing a dispute resolution regime whose compatibility with sustainable economic and social development goals, if not its entire legitimacy, has been called into question. A task force jointly constituted by ICCA and Queen Mary University of London recently produced a report in which it articulated principles relating to disclosure and conflicts of interest, privilege and professional secrecy, the allocation of costs, and security for costs, which were intended to introduce clarity and consistency into third-party-funding practices in international arbitration. Although promising in some respects, the principles were conservative in others. This article identifies some shortcomings in the principles put forward by the task force and proposes adjustments to some of their conservative aspects. In so doing, it touches on the broader question of the suitability of third-party funding to investor-state dispute settlement, given the system’s particularities.