Investor-State Dispute Settlement Reform at UNCITRAL: A Looming Constitutional Moment?

Some constitutional moments, like the transformation of France’s Third Estate into a National Assembly on 17 June 1789, come with a big blast and are recognizable as such almost immediately by its contemporaries. Others are quieter, more subtle; they creep in rather than explode, but are no less fundamental in transforming socio-institutional arrangements. The work of the United Nations Commission on International Trade Law (UNCITRAL) on ‘InvestorState Dispute Settlement (ISDS) Reform’, which started for good in late 2017,1 may well be the beginning of such a constitutional moment in international economic governance. While Working Group III, tasked to address ISDS reform, is for now still focused on the first two of its three-step mandate – problem-analysis and assessing the desirability of reform – it will most certainly reach the final stage of its mandate and ‘develop any relevant solutions’.2 This is when a constitutional moment looms, in the argumentative showdown and decision on how to achieve systemic ISDS reform: whether through further institutionalization, for example by creating a permanent multilateral investment court, as supported by the European Union, or through more limited procedural reforms of investor-State arbitration, as championed by the United States.3 If consensus can be reached to create a permanent multilateral institution – in the form of