Issues of Timing and Pro-Claimant Bias in Arbitrator Selection

Organised by

• Department of Law

Abstract

Recent empirical studies have confirmed that arbitrator selection affects outcomes in investor-state arbitrations. This article builds on the existing literature, relying on insights gained from 48 semi-structured interviews with investor-state arbitration practitioners. It makes three novel claims: (A) Sophisticated counsel nowadays will take factors beyond a candidate's appointment record into account when selecting an arbitrator. In this, a candidate’s likely ability to convince their peers is particularly important. (B) States struggle to keep up with investors in the sophisticated process of arbitrator selection. They are frequently unable to engage counsel and select suitable arbitrators within the mandated timelines for arbitrator selection. And (C), as a consequence of the former two insights, states frequently fall into four different traps when selecting arbitrators, which hinders their ability to effectively further their case during arbitrator selection. Investors tend to avoid these traps. Thus, the systemic feature of arbitrator selection disadvantages states in investor-state arbitrations. The article proposes that this pro-claimant bias may be rectified by the establishment of a multilateral institution to support states in defending themselves against investor-state arbitral claims or by the amendment of existing investment treaties and arbitration rules.