Host states’ right to sue: A remedy begging for invocation

Although the United Nations Commission on International Trade Law reform agenda concerning investor-State dispute settlement is comprehensive, there are still gaps that need to be filled. Two noticeable gaps are consideration of the recognition of the normativity of equity in arbitration (which could have been accommodated within the current agenda) and the actions that states must take to save them from falling prey to the international investment arbitration pitfalls (an aspect of state actions that falls outside the purview of any reform agenda). This work focused on the second noticeable gap. The scope of the work was further narrowed to the issue of host states right to sue in investment arbitration. No matter how laudable the international investment regime becomes, it will make little or no difference in a state unless the state has an appropriate investment policy framework that it deliberately executed in its national interest. A well-thought-out arbitration policy will contemplate possible backlash and avoid or mitigate against it. This work employed doctrinal research methodology, reviewed previous literature regarding host states right to sue, and analyzed international instruments to validate that there is no international law inhibition on such a right.