Improving third-party participation in investment arbitration: IBA recommendations

The International Bar Association has released its Report and Recommendations on Third-Party Participation in Investment Arbitration (the “Report”), setting out recommendations aimed at improving transparency, consistency, and procedural fairness in the treatment of third-party participation (“TPP”) in investment arbitration.

The Report reflects that third-party participation is increasingly at issue in investor-State dispute settlement, particularly in cases that raise public interest issues extending beyond the immediate rights and obligations of the disputing parties. As a result, the key question is not whether non-parties may seek to participate, but how applications should be assessed and how best to structure participation to assist the tribunal without compromising fairness, efficiency, or party autonomy.

For parties, counsel, tribunals, and third-party participants, the Report provides a useful framework for understanding emerging best practices and offers practical guidance on how applications for third-party participation are likely to be assessed.

The Report’s recommendations

Third-party applicants are diverse, ranging from non-governmental organizations and civil society groups to sovereigns, Indigenous communities, industry associations, and private entities with specialized expertise.

Participation typically takes two principal forms:

• amicus curiae submissions, where a non-party with an interest in a particular aspect of the case seeks leave to provide observations; and
• submissions by non-disputing treaty parties (“NDTPs”), which generally concern the interpretation of treaty provisions.

Although early arbitration rules were largely silent on TPP, tribunals have tended to assert authority to admit third-party submissions where they assist in resolving the dispute. Yet approaches to the admission of TPP and its role in an arbitration are not uniform across treaties and institutional rules, let alone practice.

With a view to unifying practice, the IBA’s Report identifies seven areas in which greater clarity and harmonization are warranted. Although the Report focuses primarily on amicus curiae submissions, the recommendations also pertain to NDTPs, where applicable.

1. Increase transparency through disclosure

The Report emphasizes the importance of disclosure obligations imposed on prospective amicus curiae applicants. It recommends that applicants disclose their identity, ownership and control, sources of funding, and any direct or indirect connection to a disputing party.

At the same time, it is recognized that disclosure should not be unlimited. In particular, charitable organizations and non-profits should not generally be required to disclose donor information unless those donors are directly involved in supporting the submission.

2. Consider party comments on TPP applications

The IBA recommends that tribunals systematically seek and consider the views of the parties before admitting third-party submissions, whether by applicants or ex officio invitation.

This reflects an underlying concern with procedural fairness: even where tribunals retain discretion, party input remains an important safeguard against prejudice.

3. Seek party input prior to ex officio invitations

A related issue concerns the ability of tribunals to invite third-party participation on their own initiative absent explicit authorization in the governing framework.

The Report emphasizes that tribunals should seek party input when they are considering inviting TPP ex officio; moreover, tribunals are counseled to consider whether alternative mechanisms would more effectively assist in resolving the issues before them.

4. Require a “distinct perspective”

The Report recommends that tribunals assess whether a proposed participant’s expertise or unique perspective would add meaningful value rather than repeating party submissions.

5. Define what constitutes a “significant interest”

The Report recommends that tribunals take a structured approach in considering whether a third party has a significant interest in the case, by reference to:

• its direct stake in the dispute;
• its connection to the dispute through its mandate or activities; or
• its broader but compelling interest in the legal or policy issues at stake.

6. Set clear procedural timetables

To mitigate the risk of TPP introducing delays, costs, and procedural complexities, the Report recommends that tribunals establish clear timetables governing applications, decisions, and the submission of materials, in addition to proactively regulating the scope, format, and length of submissions.

7. Balance access to documents and confidentiality

Access to the arbitral record remains one of the most contested aspects of TPP. The Report proposes a two-step approach to addressing this problem: where possible, third parties should have access to pleadings, but access to additional materials should only be granted where necessary for the preparation of their submissions. Redactions and confidentiality undertakings should be used appropriately.

Broader implications

If the IBA’s recommendations appear familiar, it may be because of the similarity to the test for interveners in domestic Canadian proceedings. Both frameworks focus on whether the proposed intervener has a genuine interest in the proceedings, can offer a distinct and useful perspective that assists the decision-maker, and can participate without causing undue prejudice, delay, or inefficiency.

In both contexts, the overarching objective is to ensure that intervention contributes meaningfully to the resolution of the dispute while remaining consistent with procedural fairness and the interests of justice.

TPP is most common in disputes engaging issues of public importance that raise systemic, policy-oriented, or community-impact issues that extend beyond the immediate rights and obligations of the disputing parties, including:

• extractive industries (mining, oil and gas);
• environmental regulation;
• Indigenous rights; and
• broader ESG-related measures.

Recent interventions by Canada as a non-disputing treaty party illustrate how these principles operate in practice.

For example, in Silver Bull Resources, Inc. v. United Mexican States, claims were brought under NAFTA/CUSMA transitional provisions relating to a mining investment in Mexico. The investor alleged breaches including expropriation, minimum standard of treatment/fair and equitable treatment, full protection and security, national treatment, and most-favoured-nation treatment. Canada intervened to submit its observations on the interpretations of both the transitional provisions and the interpretation of substantive protections under the NAFTA.

In Eco Oro Minerals Corp. v. Republic of Colombia, a dispute concerning a Canadian mining investment and environmental restrictions imposed by Colombia, Canada intervened to give its interpretation of the Canada–Colombia Free Trade Agreement. Canada's submissions focused on the distinction between expropriation and legitimate environmental regulation, emphasizing that non-discriminatory measures adopted in good faith to protect public welfare objectives generally should not give rise to compensation, even where they adversely affect the value of an investment.

Interventions, whether as a TPP or non-disputing party, are not necessarily limited to questions concerning traditional investment protections. They may extend to disputes that engage broader public policy considerations, particularly the relationship between investment protection and a State's regulatory authority. However, the mere fact that a dispute engages issues of public importance does not, on its own, mean that TPP is warranted.

As investment disputes increasingly engage environmental, social, and governance considerations, tribunals are likely to face a growing number of requests for third-party participation. The Report provides a useful framework for assessing when TPP may be appropriate and how it should be managed.

The authors would like to thank Catherine Waked, summer law student, who helped in drafting this article.