Foreign Investors and Greater Transparency in Investor-State Dispute Settlement: Reevaluating Confidentiality Expectations in International Investment Arbitration

Abstract

Enhancing transparency is touted as one of the responses to the ongoing criticism regarding the legitimacy of the investor-State dispute settlement system. Since investment disputes involve matters of public interest, granting public access to certain aspects of the arbitral proceedings ensures that members of the citizenry have the opportunity to be informed of the matters in dispute, as well as to be heard on these issues if the outcome potentially affects them. A palpable move towards increased transparency in investment arbitration has resulted in the revision of institutional arbitral rules, a set of rules devoted entirely to transparency, and even a convention. The increased transparency regime in investment treaty arbitration has practical implications on foreign investors bringing a claim against the State that hosts their investment. As private entities, the concerns of foreign investors with respect to transparency are different from that of State parties. This paper will look at the practical burdens imposed upon claimants as a result of non-disputing party participation, the protection of confidential business information, the interplay of transparency and criminal proceedings launched against foreign investors, and the issue of corporate nationality planning. The arc of the transparency movement can be traced in parallel to the paradigm shift in international investment law. The immediately following section will expound on this idea, to provide a basis for understanding the new expectations placed upon the investor-State dispute settlement system from the vantage point of investor-claimants.