Settlement of foreign investment contract disputes through arbitration

Abstract

International commercial arbitration is one of the most important alternative means of resolving investment contract disputes. It is widely used by both investors and host states seeking peaceful solutions to avoid lengthy and complex judicial procedures. This is due to the speed and simplicity of arbitration proceedings, as well as the confidentiality of the details of the cases of the parties involved, which preserves their commercial reputation. In addition, arbitration is less costly than judicial proceedings.
Investors also choose arbitration to avoid the application of host state laws that may be unfair or not in their interest. Some states also use arbitration as an incentive to attract investment. Despite the reservations expressed regarding it, particularly that some of its rulings are considered to undermine state sovereignty, international arbitration courts have witnessed considerable activity due to the large number of cases brought before them.