Highlights

This paper concerns the settlement of investment disputes arising between States signatories to international investment agreements (IIAs). It identifies the types of disputes that can trigger a State-to-State procedure (either through diplomatic protection of the investor or as a result of a dispute over the interpretation or application of an IIA).

It reviews the procedures governing dispute settlement mechanisms:

• negotiations and consultations;
• ad hoc inter-State arbitration;
• permanent arbitral or judicial arrangements; and
• political or administrative institutions.

The paper also examines the applicable standards for dispute settlement, as well as the question of law governing its resolution and the nature and scope of the outcomes and the compliance with dispute settlement awards.

Finally, it considers the various options open to negotiators drafting State-to-State dispute settlement clauses.