Chapter

Legal Protection for Small and Medium-Sized Enterprises through Investor-State Dispute Settlement

Alexander Gebert

in Small and Medium-Sized Enterprises in International Economic Law

Published in print May 2017 | ISBN: 9780198795650
Published online June 2017 | e-ISBN: 9780191836961 | DOI: http://dx.doi.org/10.1093/acprof:oso/9780198795650.003.0012

Series: International Economic Law Series

Legal Protection for Small and Medium-Sized Enterprises through Investor-State Dispute Settlement

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The chapter illustrates the participation of small and medium-sized enterprises (SMEs) in the investor-state dispute settlement (ISDS) system, as well as obstacles from pursuing claims under investment treaties with corresponding solutions. SMEs are increasingly investing in foreign countries, and may be subject to state measures violating international law standards afforded under investment treaties. Investment treaties regularly also provide for ISDS as a means to enforce these standards by allowing foreign investors to commence arbitration proceedings against a state in a neutral forum. The chapter reveals that despite the perception as a dispute settlement mechanism accessible exclusively for large multinational corporations, in fact a substantial part of claimants in ISDS proceedings are SMEs. While it is true that high costs and the long duration of ISDS proceedings may be obstacles for SMEs, the flexibility of arbitration proceedings and the availability of external funding provide for opportunities to control time and costs.

Keywords: SME; ISDS; investor-state arbitration; investment treaty; case management; cost allocation; multi-party arbitration; third-party funding; investment guarantee

Chapter.  7555 words.  Illustrated.

Subjects: Public International Law

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