Multilateral Investment Court: The Gap Between the EU and China

Abstract

The EU has now shifted from ad hoc investment arbitration to an envisaged Multilateral Investment Court. Its essential character is expected to be a two-instance standing court system, together with a random allocation of cases. This judicialized court system could address China’s preference of correctness as to ISDS system to some extent, subject to the competence of judges, while at the same time it raises new problems and new concerns. Firstly, would the envisaged standing court, in the context of enhancing the regulatory powers of states, still be qualified as a neutral forum to strike the appropriate balance between the protection of investors’ right and preservation of states’ regulatory powers? Secondly, would the judicialized court system be effective and flexible enough to suit the current nature of ISDS? Thirdly, would the envisaged two-tier court system be put into efficient operation so as not to become a de facto bar to access of justice? In fact, a judicialized system has its pros and cons, and thus its successful establishment and operation would be subject to more detailed rules.