Pro-claimant bias in arbitrator selection

Abstract

Recent empirical studies have confirmed that arbitrator selection affects outcomes in investor–state arbitrations. This article builds on the existing literature, relying on 48 semistructured interviews with investor-state arbitration practitioners. It makes three novel claims: (A) sophisticated counsel nowadays will take factors beyond a candidate’s appointment record into account when selecting an arbitrator. In this, a candidate’s likely ability to influence their peers’ thinking is particularly important. (B) States struggle to keep up with investors in the sophisticated process of arbitrator selection. They are frequently unable to engage counsel and select suitable arbitrators within the mandated timelines for arbitrator selection, and (C), as a consequence of the former two insights, states frequently fall into four different traps when selecting arbitrators. They appoint as their arbitrators famous jurists without significant investor-state arbitration experience, famous proinvestor arbitrators, and famous arbitrators that have publicly assumed entrenched positions and defer appointments to appointing authorities. This hinders states’ ability to effectively further their case during arbitrator selection, thus disadvantaging them in investor–state arbitrations.