Say What You Mean: Improved Drafting Resources as a Means for Increasing the Consistency of Interpretation of Bilateral Investment Treaties
Following the demise of international recognition of the Hull Rule as the standard governing foreign direct investment, countries throughout the world have turned to bilateral investment treaties (BITs) to govern direct investment relationships. BITs allow countries to bind themselves credibly to commitments by granting substantive rights to investors and offering remedies for violations of those rights, thereby incentivizing new investments and facilitating economic ventures. The recent dramatic increase in disputes arising under BITs has shaken the legitimacy of these agreements. Arbitration panels interpret these documents inconsistently, which disparately impacts developing nations negatively. The inconsistent interpretations rob BITs of clarity and transparency as to the nature and extent of the commitments. Consistency in interpretation can be achieved through reform of the arbitration process or reform of the drafting process. Reform of the arbitration process would fly in the face of the nature and character of the arbitration process, and it cannot alleviate the interpretive difficulties the panel faces. Reform of the drafting process can improve the documents themselves, as well as the interpretive process. BIT drafters must conquer the inherent difficulties of communicating intentions through language, as well as the additional problems created by the existence of multiple authoritative texts in different languages. This Note concludes that improved drafting is the key to providing consistency in interpretation, thereby increasing the credibility of BITs. To that end, this Note proposes a multilingual compilation of key BIT terminology, as provided by each individual country, to serve as a resource to drafters and interpreters.