Alternatives to Investor-State Dispute Settlement: An African Perspective

The investor–state dispute settlement system (ISDS) has served as an alternative to domestic legal processes in the post-colonial era, particularly in less developed countries. Although the countries whose legal processes ISDS has supplanted have over the decades begrudgingly acquiesced, they have never appreciated the increasing interference in their policy spaces by arbitral tribunals constituted largely of a limited pool of specialised jurists from the Global North. As the excesses of these tribunals have begun to encroach on the policy spaces of the more advanced economies of the Global North, the foundations of their mandate and the nature of the legal constraints of their processes have increasingly come under closer and public scrutiny. That, in turn, has resulted in sovereign actions of renunciation and new proposals to modify or even replace the existing system. Many developing countries – ranging from India to South Africa – have taken dramatic measures in this regard. This paper evaluates current trends regarding the ISDS system and provides a summary of proposals that developing countries, particularly African countries, may consider in their reform efforts.