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Reform of the IIA regime

Today the great majority of countries are parties to one or more International Investment Agreements (IIAs). At the same time, many governments are not fully satisfied with the existing IIA regime. Concerns relate mostly to the development dimension of IIAs, the balance between the rights and obligations of investors and States, and the systemic complexity of the IIA regime. To these add growing uneasiness about the actual effects of IIAs in terms of promoting FDI or reducing policy and regulatory space, increasing exposure to investors’ claims and the lack of specific pursuit of sustainable development objectives. However, views on IIAs are strongly diverse, even within countries.

The IIA-based system of investor-State dispute settlement (ISDS) by ad hoc international arbitral tribunals, increasingly used by investors, has given rise to a distinct set of challenges. Originally designed to depoliticize investment disputes and create forum that would offer investors a fair hearing before an independent, neutral and qualified tribunal, the actual functioning of the ISDS mechanism under existing treaties has led to concerns about systemic deficiencies in the regime. Relevant questions include:

  • What are the key areas and pressing issues in IIAs and ISDS?
  • What are the key ways and means to address these issues?
  • What types of mechanisms and platforms are needed to facilitate the reform?

UNCTAD is spearheading research and publications on these issues. See also: