An Original Investigation of the Theory and Practice of Investor-State Dispute Resolution in the Context of African Development Objectives

Investor-state dispute resolution mechanisms, particularly through ICSID arbitration, have been criticised in the African context for constraining regulatory policy space needed for development objectives while providing disproportionate procedural advantages to foreign investors over host states and their communities. This study makes an original theoretical contribution by developing an African Development-Consistent Investor Protection Framework (ADCIPF) that reconciles legitimate investor protection with African states' constitutional and developmental obligations, using Nigeria as a primary case study alongside comparative examples from South Africa, Tanzania, and Mozambique. The ADCIPF is developed through three complementary theoretical moves: a historical analysis of investor-state dispute resolution experience in Africa showing systematic outcomes adverse to regulatory policy space; an original theoretical model of legitimate expectations in the African development context that constrains arbitral tribunals from invalidating non-discriminatory development regulation; and a normative framework for a reformed investor protection regime based on the sustainable development approach to investment treaty drafting. The study draws on analysis of 35 investor-state arbitral awards involving African states from 2000 to 2023, interviews with 25 international investment law experts and African state legal officers, and comparative analysis of the Pan-African Investment Code and the Nigerian Model BIT negotiation record. Results indicate that current ISDS practice creates unjustifiable regulatory chill in sectors including environmental regulation, natural resource governance, and financial services regulation. The ADCIPF constitutes an original contribution to investment law theory and generates a Nigerian Model Investment Agreement reformulation.

Keywords: investor-state dispute resolution, investment arbitration, African development, regulatory space, Nigeria