Invesment arbitration in the Mining sector: trends, tensions and landmark cases

Abstract

This article analyzes the evolution of investment arbitration in the mining sector in Latin America, with a special emphasis on the tensions between regulatory sovereignty, environmental protection, and investor expectations. The aim of the research is to identify the interpretative criteria adopted by arbitral tribunals and examine their evolution, in order to determine whether there is a trend toward greater acceptance of changes in arbitral reasoning. The central issue is to determine whether the contemporary arbitral system provides a coherent framework for resolving disputes arising from mining investments, in scenarios where political, regulatory, social, and environmental risks are present. To do this, the analysis is placed within the theoretical framework of investment law, examining substantive protection standards such as fair and equitable treatment (FET), full protection and security (FPS), and indirect expropriation. Just like the exceptions provided in the IIAs and the no longer so progressive incorporation of the right to regulate.
The main hypothesis holds that investment arbitration has not eliminated the structural tensions of the system, but it has evolved toward a model that recognizes the legitimacy of state regulation, particularly in environmental matters, conditioning international liability on the way such regulation is implemented. Using a qualitative methodology based on doctrinal and case law analysis of emblematic cases in the mining sector, the study concludes that arbitral tribunals have adopted a more contextual approach, incorporating factors such as social conflict, investor conduct, and the reasonableness of regulatory measures. However, it has also been determined that significant levels of uncertainty persist due to the lack of clarity or predictability of the mining regime in some States and variety of aplicable treaties.