Document Type

Discussion Paper

Publication Date



Inconsistency in legal interpretation is among the most salient problems in investor-state dispute settlement (ISDS). Some such instances have been particularly glaring, and introducing consistency into ISDS rates high on the agenda of reformers - particularly for several government delegations leading multilateral reform efforts in the United Nations Commission on International Trade Law (UNCITRAL) Working Group III. This Article starts from the position that some degree of interpretive inconsistency is endemic to any legal order. Yet systemic inconsistency tends to undermine the basic purposes of the investment treaty regime – namely protecting and promoting foreign direct investment through predictable international legal rules and institutions. With an eye to reform, seek to parse the problem of inconsistency at a more granular level, in order to distinguish between types of norms where a degree of inconsistency is (relatively) manageable and (potentially) tolerable, and those where inconsistency is unacceptable. In this regard, we focus on two key distinctions: between (1) rules and standards, and (2) norms of conduct and structural “rules of the game.” Although inconsistency is always problematic, we suggest that it is in this later category (rules of the game) where inconsistency is most destructive.


Work published when author not on Michigan Law faculty. This is the revised draft of an earlier concept paper, included here as a supplemental work.

Arato et al - Lack of Consistency and Coherence.pdf (682 kB)
Lack of Consistency and Coherence in the Interpretation of Legal Issues