The Hybrid Foundations of Investment Treaty Arbitration

The analytical challenge presented by the investment treaty regime for the arbitration of investment disputes is that it cannot be adequately rationalised either as a form of public international or private trans-national dispute resolution. Investment treaties are international instruments between states governed by the public international law of treaties. The principal beneficiary of the investment treaty regime is most often a corporate entity established under a municipal law, while the legal interests protected by the regime are a bundle of rights in an investment arising under a different municipal law. The standards of protection are fixed by an international treaty, but liability for their breach is said to give rise to a civil or commercial award for enforcement purposes. Even this superficial appraisal of the different legal relationships and categories arising out of the investment treaty regime is sufficient to disclose its hybrid or sui generis character.