Investor-State Dispute Settlement under the Trans-Pacific Partnership

By Ko-Yung Tung*

I. INTRODUCTION

The United States is currently in the last stages of its negotiations with eleven other countries in the Pacific Rim region (namely Japan, Australia, Mexico, Canada, Malaysia, Chile, Singapore, Peru, Vietnam, New Zealand and Brunei Darussalam) to conclude a regional trade and investment regime, popularly known as the Trans-Pacific Partnership ("TPP").¹ With the United States and Japan having the largest and the third largest economies of the world, the TPP would encompass approximately forty percent of global gross domestic product.² The European Union, by contrast, accounts for only about eighteen of global GDP.³

While the negotiations for the Trans-Pacific Partnership Agreement ("TPP Agreement") have been conducted in secrecy, a draft of its investment chapter recently was leaked by WikiLeaks.⁴ This article will briefly highlight some salient points of the investor-state dispute settlement ("ISDS") provisions in the leaked draft of the investment chapter of the TPP Agreement. Two important caveats are necessary at the outset— first, there is some dispute whether the WikiLeaks leaked version is authentic and whether it is a current draft as of the date on the version (purported to be to be "January 20, 2015 draft"); and second, what form the final ISDS of the TPP Agreement will take is still unknown, and even whether the TPP will come to fruition at all, given the politics of the United States, let alone those of the other eleven countries.⁵ For purposes of this article, the so-called January 20, 2015 draft will be referenced.