The hypothesis of the present article is that third-party funding in investor-state dispute settlement is necessary to ensure access to justice in ISDS.
Authors
Wasiq Dar, Associate Professor, Jindal Global Law School (JGLS), O.P. Jindal Global University, Sonipat, Haryana, India.
Gautam Mohanty, Assistant Professor, Jindal Global Law School, O.P. Jindal Global University, Sonipat, Haryana, India; Kozminski University, Warsaw, Poland.
Summary
The burgeoning costs of international arbitration are its worst kept secret. Given the high costs involved, it is inevitable that parties to the arbitration proceedings may be either willing to pay the costs but are unable to or maybe are able to pay the costs but unwilling to.
The significant drain on the financial resources of the parties coupled with the need to maintain financial stability has resulted in parties opting for a wide array of litigation financing options. Such being the case, the need for market-based solutions has also prompted the advent of third-party funding (TPF). Consequently, it is not surprising to witness the recent usage of TPF in investor-state arbitrations.
The hypothesis of the present article is that TPF in investor-state dispute settlement (ISDS) is necessary to ensure access to justice in ISDS. Accordingly, the first part of the article establishes the connect between the concept of access to justice and ISDS. The second part of the article examines the relationship between access to justice and TPF and assesses how ISDS tribunals react and critique the presence of a funder in ISDS proceedings.
In essence, the second part will evaluate TPF vis-à-vis Security for Costs applications in the ISDS framework, thereby confirming or dismissing the general hypothesis that TPF is necessary for access to justice in ISDS. The last part of the article concludes with the pertinent underpinnings and takeaways of the above two parts of the article.
Published in: Manchester Journal of International Economic Law
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