9 - Fair and Equitable Treatment: Ordering Chaos through Precedent?

Summary

The growing judicialization of ISDS through the use of precedent may be contributing to improved consistency in the interpretation of the FET standard. The FET standard and its interpretation by arbitral tribunals has been blamed for giving foreign investors carte blanche to sanction governments over broad swathes of policy. It is said to be lacking any common definition and that it is a vague and ambiguous catch-all term. This chapter provides a rigorous qualitative and quantitative empirical assessment of the use of citations and their role in the development of the FET standard consistently by tribunals across time. Based on the in-depth exploration of FET case law the authors find that three landmark cases have a de facto stare decisis with the effect of reconciling competing interpretations and ultimately providing a relatively consistent standard.