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With the rise of treaty-based investor-state dispute settlement (“ISDS”) which has taken place over the last two decades, a number of governments have adopted varying approaches to avoid those arbitration cases. Countries including Bosnia and Herzegovina, Colombia, Mexico, Mongolia, and Peru have pursued such initiatives, often with the support of intergovernmental organizations such as the United Nations Convention on Trade and Development (“UNCTAD”) and the World Bank.

In the context of discussions on ISDS reform taking place at the United Nations Commission on International Trade Law (“UNCITRAL”), some states have identified development and implementation of such ISDS-avoidance strategies and tools as initiatives they would like to pursue. There remains, however, relatively little dialogue and research exploring the comparative institutional design, functional workings, and costs and benefits of different approaches, and identifying, articulating, and disseminating lessons learned from experiences to date.

This article draws from a broader research project exploring the effectiveness of dispute prevention approaches (and perceptions thereof) at resolving underlying conflicts between investors and states, and at their implications for other stakeholders. Understanding how dispute prevention approaches can and do operate and whether and how they can provide meaningful and lasting solutions to the broader conflicts underlying investor-state disputes can critically inform the assessment of existing approaches and the design of new ones.


Dispute Resolution and Arbitration | International Trade Law | Law