This essay examines the potential for arbitration to resolve disputes between private companies and developing countries over the propriety of compulsory licenses. At bottom, my thesis is that arbitration supplies the medium through which to mediate the tension between the profit-seeking goals of private multinational companies and the development goals of foreign nations, especially in the developing world. The compulsory license debate raises a clash of fundamental interests between the patent holder, the patent holder’s state, and the host state. Arbitration can play an important role in balancing those interests, albeit a highly unusual one. Arbitration provides an essential forum through which to test the legality of a state’s compulsory license. This is particularly important where the patent holder cannot rely upon its own nation-state adequately to vindicate its interests. Despite the potential importance of arbitration in this context, patent holders curiously have not actually pursued this form of dispute resolution. Nonetheless, this does not render arbitration unimportant. Rather, it becomes an important background vehicle against which nation-states and patent holders can strike the bargains necessary to balance their respective interests in the development and exploitation of inventions such as pharmaceuticals in the context of a public health crisis.
Rutledge, Peter B., "TRIPS and BITs: An Essay on Compulsory Licenses, Expropriation, and International Arbitration" (2012). Scholarly Works. Paper 827.