Investment Tribunals sitting in review of a State’s public policy decisions often do not give much deference to the State’s rationale. However, it would only be reasonable for a State to expect that its legitimate authority to determine policy decisions taken in the best interest of the people are given weight by the tribunal. Identifying and applying an appropriate standard of review thus becomes exceedingly important to address this dichotomy. With this premise, this article will examine the standard of review adopted by investment tribunals while reviewing states’ policy decisions and how investment tribunals failure to exercise self-restraint has given rise to a ‘legitimacy crisis’ for the entire investment law regime. Further, the article will go on to discuss how India has taken the first affirmative step towards establishing a coherent and uniform standard of review in its revised Model BIT of 2015.
Global Trade and Customs Journal