[Muthucumaraswamy Sornarajah is the CJ Koh Professor of Law, National University of Singapore and a Visiting Professor, Centre for the Study of Human Rights, London School of Economics.]
Michael Goldhaber’s well-argued
piece on the extent of the powers that investment arbitration tribunals are arrogating to themselves is evidence of a general malaise that afflicts investment arbitration. The arbitrators have assumed powers far in excess of what states intended them to have when they made investment treaties and created a unilateral power in the investor to arbitrate disputes. Consistent with prevailing ideas generated by the Washington Consensus and its desire to bring about standards of global governance, arbitrators promoting their own self-interest went on a rampage of expansionist interpretation of treaties. Goldhaber highlights one of the most glaring instances of this neoliberal expansionism, the making of interim orders restraining a respondent state from enforcing judgments of their domestic courts made in cases involving third parties.
This phenomenon is but an aspect of a project to build up a neoliberal regime of inflexible investment protection. In the aspect of this project that Goldhaber describes, there has been an assiduous effort made by leading members of the “college of international lawyers”, entrusted the task of being bulwarks against injustice, promoting sectional interests of investors to the detriment of other values such as the protection of human rights and the environment.
The downsizing of the notion of denial of justice so that it could accommodate lesser standards enabling easy review of domestic judicial orders is a definite project that arbitrators and “highly qualified publicists” embarked upon. Arbitrators, whose legal competence is not tested or uniform, embarked on a course of review of domestic decisions. Golhaber describes these processes with competence. As he points out, while purporting not to act as appellate courts, this is precisely what the tribunals were doing.
