Investor Presentaiton

28 INVESTOR-STATE DISPUTE SETTLEMENT: A SEQUEL are subject to ethical rules requiring independence and impartiality. Particular concerns have arisen from a perceived tendency of each disputing party to appoint individuals sympathetic to their case. Arbitrators' interest in being re-appointed in future cases and their frequent "changing of hats" (serving as arbitrators in some cases and counsel in others) amplify these concerns. 18 19 Cost- and time-intensity of arbitrations. Actual ISDS practice has put into doubt the oft-quoted notion that arbitration represents a speedy and low-cost method of dispute resolution. On average, costs, including legal fees (which on average amount to approximately 82% of total costs) and tribunal expenses, have exceeded $8 million per party per case. For any country, but especially for poorer ones, this is a significant burden on public finances. Even if the government ends up winning the case, tribunals have mostly refrained from ordering the claimant investor to pay the respondent's costs. At the same time, high costs are also a concern for investors, especially small- and medium-sized enterprises. Large law firms, who dominate the field, tend to mobilise a team of attorneys for each case who charge high rates and employ expensive litigation techniques, which include intensive research on each arbitrator candidate, far-reaching and burdensome document discovery and lengthy arguments about the minutest case details.20 The fact that many legal issues remain unsettled contributes to the need to invest extensive resources to develop a legal position by closely studying numerous previous arbitral awards. Some of the same reasons are also responsible for the long duration of arbitrations, most of which take several years to conclude. It is not 18 19 20 For further details, see Gaukrodger and Gordon, 2012, pp. 43–51. Ibid., p. 19. Lawyers' fees may in some instances reach as high a figure as $1,000 per hour for senior partners in top-tier law firms. Ibid., pp. 19–21. UNCTAD Series on International Investment Agreements II

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