Adjudicator Compensation Systems and Investor-State Dispute Settlement

David Gaukrodger
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David Gaukrodger: OECD

No 2017/5, OECD Working Papers on International Investment from OECD Publishing

Abstract: Compensation for adjudicators is generally considered as a core issue for judicial independence and for attracting good judges in the institutional design for courts. This paper examines compensation systems for adjudicators and dispute settlement administrators in investor-state dispute settlement (ISDS). The paper uses in part a comparative perspective based on approaches in domestic courts in advanced economies, an approach rarely taken in analysing investor-state arbitration.The first section of the paper provides historical context and examines the reform of remuneration of judges to replace private litigant fees with salaries in colonial America and the United States, France and England in the 18th and early 19th centuries. Subsequent sections address debates over the impact of compensation systems on adjudicators; contemporary approaches to the compensation of judges in advanced economies; the co-existence in advanced economies of national courts with salaried judges since the early 19th century with generally strong support for commercial arbitration based on ad hoc fee-based remuneration; and similarities and differences between commercial arbitration and investment arbitration, focusing how the largely similar compensation systems may have different effects and be differently perceived by the public.Annexes to the paper report on discussions about adjudicator compensation at the 2016 OECD Investment Treaty Conference and gather some preliminary facts about adjudicator and dispute administrator compensation in investor-state arbitration as well as the investment court system included in the recent EU-Canada CETA trade and investment agreement.

Keywords: Alexander Hamilton; arbitrator compensation; bilateral investment treaties; comparative law; conflicts of interest; court fees; dispute settlement; domestic courts; economic incentives; foreign investment; international commercial arbitration; international economic law; international investment; international investment agreements; international investment law; investment arbitration; investment treaties; investment treaty policy; investor protection; investor-state dispute settlement; ISDS; Jeremy Bentham; judicial compensation; legal history; litigant fees; Voltaire (search for similar items in EconPapers)
JEL-codes: H4 J3 J33 J44 K23 K33 K41 L33 N20 N4 (search for similar items in EconPapers)
Date: 2017-11-24
New Economics Papers: this item is included in nep-his, nep-int, nep-law and nep-lma
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