Integrating Indigenous Peoples’ Rights into Investor-State Dispute Settlement: The Case of Multilateral Investment Court
(2025) JURM02 20251Department of Law
Faculty of Law
- Abstract
- Investor-State Dispute Settlement (ISDS) is a mechanism that allows foreign investors to sue host States in private international tribunals for alleged breaches of investment protection standards. This mechanism, and international investment law in general, frequently excludes Indigenous Peoples, even when foreign investment projects directly impact them and violate their rights to land and self-determination. Their rights are frequently sidelined in favour of investor interests, not only by States, which are often reluctant to promote Indigenous Peoples’ rights for fear of being sued by investors, but also by ISDS tribunals, which rarely consider Indigenous Peoples or their rights.
Against this background, the thesis investigates the... (More) - Investor-State Dispute Settlement (ISDS) is a mechanism that allows foreign investors to sue host States in private international tribunals for alleged breaches of investment protection standards. This mechanism, and international investment law in general, frequently excludes Indigenous Peoples, even when foreign investment projects directly impact them and violate their rights to land and self-determination. Their rights are frequently sidelined in favour of investor interests, not only by States, which are often reluctant to promote Indigenous Peoples’ rights for fear of being sued by investors, but also by ISDS tribunals, which rarely consider Indigenous Peoples or their rights.
Against this background, the thesis investigates the extent to which the Multilateral Investment Court (MIC), a current reform proposal for the ISDS system, could strengthen Indigenous Peoples’ rights. It focuses primarily on how the MIC could potentially impose duties on investors to meaningfully respect Indigenous Peoples’ rights. This is achieved by examining investors’ responsibilities in relation to core concepts such as the right of Indigenous Peoples to Free, Prior and Informed Consent (FPIC) and the Social Licence to Operate (SLO), which emphasises that companies should obtain social approval for their projects.
The thesis finds that foreign investors, as corporate actors, have a responsibility to respect Indigenous Peoples’ right to FPIC. Fulfilling this responsibility requires more than treating FPIC as a mere procedural process. Corporations must engage with Indigenous Peoples as early as possible, particularly at the same time they begin planning with the State for any proposed project that may affect them. Moreover, they must recognise Indigenous Peoples as right-holders whose self-determination, perspectives and worldviews should be respected and reflected in project outcomes.
Additionally, the thesis concludes that although Indigenous Peoples’ rights have gained greater recognition in international law, and corporations have become more responsible for respecting these rights, this progress has not been reflected in the ISDS system. As the MIC proposal currently stands within the negotiations of the UNCITRAL Working Group III, this imbalance will persist, as the system continues to prioritise the protection of foreign investments and investor interests. The thesis proposes that introducing arbitrators with expertise in Indigenous Peoples’ rights, conditioning access to ISDS on compliance with Indigenous Peoples’ rights and reducing compensation awards could incentivise investors to respect Indigenous Peoples’ rights more effectively. However, it also concludes that while these solutions indirectly impose accountability, their practical impact might be limited. (Less)
Please use this url to cite or link to this publication:
http://lup.lub.lu.se/student-papers/record/9189330
- author
- Fathi, Sara LU
- supervisor
- organization
- course
- JURM02 20251
- year
- 2025
- type
- H3 - Professional qualifications (4 Years - )
- subject
- keywords
- Public International Law, Indigenous Peoples' Rights, FPIC, ISDS, International Investment Law
- language
- English
- id
- 9189330
- date added to LUP
- 2025-06-19 11:49:31
- date last changed
- 2025-06-19 11:49:31
@misc{9189330,
abstract = {{Investor-State Dispute Settlement (ISDS) is a mechanism that allows foreign investors to sue host States in private international tribunals for alleged breaches of investment protection standards. This mechanism, and international investment law in general, frequently excludes Indigenous Peoples, even when foreign investment projects directly impact them and violate their rights to land and self-determination. Their rights are frequently sidelined in favour of investor interests, not only by States, which are often reluctant to promote Indigenous Peoples’ rights for fear of being sued by investors, but also by ISDS tribunals, which rarely consider Indigenous Peoples or their rights.
Against this background, the thesis investigates the extent to which the Multilateral Investment Court (MIC), a current reform proposal for the ISDS system, could strengthen Indigenous Peoples’ rights. It focuses primarily on how the MIC could potentially impose duties on investors to meaningfully respect Indigenous Peoples’ rights. This is achieved by examining investors’ responsibilities in relation to core concepts such as the right of Indigenous Peoples to Free, Prior and Informed Consent (FPIC) and the Social Licence to Operate (SLO), which emphasises that companies should obtain social approval for their projects.
The thesis finds that foreign investors, as corporate actors, have a responsibility to respect Indigenous Peoples’ right to FPIC. Fulfilling this responsibility requires more than treating FPIC as a mere procedural process. Corporations must engage with Indigenous Peoples as early as possible, particularly at the same time they begin planning with the State for any proposed project that may affect them. Moreover, they must recognise Indigenous Peoples as right-holders whose self-determination, perspectives and worldviews should be respected and reflected in project outcomes.
Additionally, the thesis concludes that although Indigenous Peoples’ rights have gained greater recognition in international law, and corporations have become more responsible for respecting these rights, this progress has not been reflected in the ISDS system. As the MIC proposal currently stands within the negotiations of the UNCITRAL Working Group III, this imbalance will persist, as the system continues to prioritise the protection of foreign investments and investor interests. The thesis proposes that introducing arbitrators with expertise in Indigenous Peoples’ rights, conditioning access to ISDS on compliance with Indigenous Peoples’ rights and reducing compensation awards could incentivise investors to respect Indigenous Peoples’ rights more effectively. However, it also concludes that while these solutions indirectly impose accountability, their practical impact might be limited.}},
author = {{Fathi, Sara}},
language = {{eng}},
note = {{Student Paper}},
title = {{Integrating Indigenous Peoples’ Rights into Investor-State Dispute Settlement: The Case of Multilateral Investment Court}},
year = {{2025}},
}