Thailand’s debut in investment treaty arbitration: the curious case of Walter Bau and its lessons for participants in international investment law

Thailand’s first experience with investment treaty arbitration has not been a pleasant one. Nevertheless, it offers important lessons to States, foreign investors, and arbitral tribunals regarding their respective participation in the process of decision-making. First, States must be meticulous in concluding investment treaties while bearing in mind that their subsequent practice affects the way those treaties are interpreted and applied. Second, foreign investors’ due diligence when making investments and their selection of a suitably qualified lawyer to represent them in arbitral proceedings will both affect the outcome of their case. Third, arbitral tribunals’ understanding of international law is critical for the credibility of investment treaty arbitration and will contribute to its legitimacy—or lack thereof. In fulfilling their role, arbitral tribunals should consider economic realities within the confines of an applicable investment treaty. Furthermore, to determine their jurisdiction ratione materiae and jurisdiction ratione personae for non-ICSID arbitration, they should adopt the single keyhole approach, following the definition of ‘investment’ and ‘investor’ given by the parties as lex specialis and acting in accordance with the principle of procedural economy.