Third Party Funding in Investor-State Dispute Settlement

Modern forms of third party funding are no longer new to international arbitration. Recent years have seen significant increases in the number of funders, the number of funded cases, the number of law firms working with funders and the number of reported cases involving issues relating to funding. When third-party funding is used in investor-state arbitration (ISDS) it raises myriad policy questions, some of which are debated in the context of third-party funding generally, and some of which are unique to ISDS. CCSI is analyzing the use of third party funding in ISDS by not only looking at what is happening, but also by considering the policy impacts of third-party funding when applied in this context, and whether the impacts are desirable or undesirable, and what mechanisms are available, or should be available, to manage the impacts.

This powerpoint presentation, Third Party Funding: Advancing or Undermining the Purpose of Investment Treaties? outlines some of the questions surrounding third party funding in ISDS.

Relatedly, CCSI and the International Council for Commercial Arbitration (ICCA)-Queen Mary Task Force on Third-Party Funding co-hosted a roundtable discussion on October 17, 2017 that considered the public policy implications of third-party funding in investor-state dispute settlement. The roundtable provided the opportunity for various stakeholders who have diverse perspectives on the use of third-party funding in ISDS to constructively discuss the Public Comment Draft of the ICCA-Queen Mary Task Force Report on Third-Party Funding (Draft Report) and the public policy issues raised therein. The outcome document from the roundtable is available here.