Open AccessProposed Regulation of Third-Party Funding in Investor-State Dispute Settlement
Author(s) -
Matias Tamlander
Publication year - 2021
Publication title -
helsinki law review/helsinki law review
Language(s) - English
Resource type - Journals
eISSN - 2489-687X
pISSN - 1797-6251
DOI - 10.33344/vol14iss1pp74-87
Subject(s) - arbitration , settlement (finance) , commission , investor state dispute settlement , context (archaeology) , state (computer science) , business , sovereignty , dispute resolution , international arbitration , law , finance , law and economics , political science , international investment , economics , foreign direct investment , politics , paleontology , algorithm , computer science , payment , biology
Third-party litigation funding is increasingly used to finance legal claims in investor-state dispute settlement, with financiers funding investor claims against sovereign states in exchange for a share of potentially substantial compensation rendered in eventual arbitral awards. A chiefly unregulated phenomenon, third-party funding has been perceived especially controversial in the context of the investment arbitration regime, a system some allege is already ingrained with inequities. Third-party funding raises numerous policy questions, such as conflicts of interests, disclosure, costs of the proceedings, and even the entire permissibility of the practice in investor-state dispute settlement. This review raises various issues and concerns related to third-party funding in investor-state dispute settlement and presents the regulatory efforts and criticism thereof with regards to the reform of rules of both the International Centre for Settlement of Investment Disputes and the United Nations Commission on International Trade Law.