Investment arbitration is a specialized form of international dispute resolution that allows foreign investors to bring claims directly against sovereign States when their investments have been unfairly treated, expropriated, or otherwise harmed by governmental measures. Such disputes typically arise under bilateral investment treaties (“BITs”), free trade agreements (“FTAs”), or investment laws, which provide for arbitration before neutral international tribunals rather than domestic courts. Most investment arbitrations are conducted under the International Centre for Settlement of Investment Disputes Rules (the “ICSID Rules”) or the United Nations Commission on International Trade Law (“UNCITRAL”) Arbitration Rules.
Arbitrations under the ICSID Rules are known to be costly. Based on Aceris Law’s experience, a claimant in a typical three-year ICSID proceeding should expect a minimum total budget of around USD 1.3 million, although actual costs vary depending on the law firm and the complexity of the case.[1] While successful claimants may recover their costs from the losing party, investors must be prepared to fund the arbitration in advance.
This practical note provides an overview of the main heads of costs in ICSID arbitrations and briefly examines how ICSID tribunals allocate costs between the parties. An ICSID arbitration typically includes the following major cost components: (i) the ICSID administrative fees and the tribunal’s fees and expenses; (ii) legal fees; (iii) expert fees; (iv) hearing costs; and (v) other costs. A summary of the main cost categories and the timing of payments is provided in the accompanying table (ICSID Arbitration Costs), with further explanations below.
The rules regarding these costs are set out across various instruments:
- The ICSID Arbitration Rules, Chapter VII: Costs;[2]
- The ICSID Administrative and Financial Regulations (2022 Version) (the “ICSID Regulations”), Chapter III: Financial Provisions;[3] and
- Convention on the Settlement of Investment Disputes between States and Nationals of Other States (the “ICSID Convention”), Chapter VI: Cost of Proceedings.
I. Heads of Costs in ICSID Arbitration
A. Non-Refundable Lodging Fee
Before an arbitration can proceed, the claimant must pay a non-refundable lodging fee of USD 25,000 (Regulation 18). The ICSID Secretariat will not take any action on a request for arbitration until this fee has been received. Once payment is made, the Secretariat forwards the request to the respondent State and conducts an initial screening process to determine whether the case should be formally registered.[4]
B. Advance on Costs
Upon registration of a request for arbitration, the claimant must make an advance payment to cover the estimated costs through the tribunal’s first session (Regulation 15(1)(a)). This initial advance is typically between USD 100,000 and USD 200,000. As the case progresses, further advances on costs are requested. Once the tribunal is constituted, the ICSID Secretary-General estimates the expenses for the next stage of the proceedings and invites both parties to make the necessary payments.[5] The Secretary-General may also ask for supplementary payments at any time if additional funds are required to cover ongoing costs (Regulation 15).[6]
These advances on costs are held by ICSID in a dedicated account and are used to cover the arbitrators’ fees and expenses, ICSID’s administrative charges, hearing and transcription costs, and other case-related expenditures. ICSID provides the parties with periodic statements showing how the advances have been applied and refunds any unused amounts at the end of the proceedings.
If one party fails to pay its share of the advance (Regulation 16), the other party must cover the unpaid portion to prevent the proceedings from being suspended or discontinued. Any payments made on behalf of the non-paying party are without prejudice to the tribunal’s final decision on the allocation of costs.[7]
1. ICSID’s Administrative Charges and Expenses
The ICSID charges an annual administrative fee of USD 52,000 for its services in arbitration proceedings (Schedule of Fees). This fee, which is generally shared equally between the parties, applies to both ICSID and non-ICSID cases administered by the Centre. Additional costs may arise when ICSID staff are required to attend meetings. A USD 200 hourly fee applies when the secretary of the tribunal participates in meetings. The Centre also recovers travel and subsistence expenses for the secretary when meetings take place outside ICSID’s headquarters, as well as any host-related charges for such meetings.
2. Arbitral Tribunal’s Fees and Expenses
The fees and expenses of the arbitral tribunal represent the second, and typically the largest item covered by the advances on costs paid by the parties to the Centre. Under Regulation 14 of the ICSID Regulations, arbitrators are entitled to receive (i) hourly fees, (ii) per diem allowances, as well as (iii) reimbursement of travel and other related expenses incurred in connection with the proceedings.[8]
(i) Hourly Fees
Arbitrators are entitled to an hourly rate of USD 500 for each hour of work performed on the case. This includes time spent on hearings, deliberations, procedural sessions, and meetings. For travel time, arbitrators receive USD 250 per hour when travelling by air or ground to and from the place of the hearing, session, or meeting. However, if an arbitrator performs case-related work while travelling, that time may be charged at the regular hourly rate of USD 500 (Memorandum on the Fees and Expenses 2022, Section I).
(ii) Per Diem Allowance
Arbitrators are entitled to receive flat-rate per diem allowances for each day they spend away from their city of residence while travelling in connection with a proceeding. When overnight lodging is required, the per diem allowance is USD 900 per full day, which covers all personal expenses, including lodging, lodging taxes, meals, and local transportation. For day trips that do not require overnight lodging, the allowance is USD 200 per day. Arbitrators are also entitled to the USD 200 per diem allowance for each day of travel to and from a hearing, session, or meeting when lodging is not required, as well as for the day of return to their city of residence (Memorandum on the Fees and Expenses 2022, Section II).
(iii) Travel Expenses
When arbitrators attend a hearing, session or meeting away from their city of residence, they may claim reimbursement for the costs of air and ground transportation to and from the city where the hearing, session or meeting is held. They are authorized to travel “at one class above economy class.” Arbitrators may also claim reimbursement for the costs of taxis to and from the points of departure and arrival, both at the city of residence and the city where the hearing, session or meeting is held. The actual costs are reimbursed based on the receipts provided (Memorandum on the Fees and Expenses 2022, Section III).
All such expenses are recorded in the financial statement of the case account, which is available to the parties at any time during the proceedings and upon their conclusion.
3. Tribunal Secretary’s Fees and Expenses
Tribunal secretaries are staff members of the ICSID Secretariat, not external assistants appointed by arbitrators.[9] Their role forms part of the Centre’s administrative functions and typically includes organizing hearings, handling correspondence, maintaining the case record, and providing procedural support to the tribunal. The compensation of tribunal secretaries is included in ICSID’s annual administrative fee charged to each case and is not billed separately to the parties.[10]
C. Legal Fees
In addition to the above institutional costs, parties must also budget for the legal fees incurred for the work of counsel and their teams, which typically represent the most significant portion of total costs, as a hard-fought ICSID arbitration case can take over 3,000 hours of work by a party’s legal team.
Although investment arbitration can be costly, overall party costs can be significantly reduced through careful case management, efficient use of counsel, and well-planned procedural strategies. Aceris Law regularly helps clients achieve substantial savings while maintaining the highest-quality advocacy. In the firm’s experience, the minimum realistic cost of pursuing or defending an investment arbitration is approximately USD 1.3 million, largely driven by expert and tribunal expenses.
Valuing transparency and predictability, Aceris Law offers reasonable, capped legal fees for representation in international arbitrations, both for investors bringing claims and for States defending against them, ensuring that all clients benefit from clear and upfront cost expectations. To help parties estimate potential expenses, Aceris Law has made available its online Arbitration Legal Fee Calculator, which allows parties to estimate likely costs based on the amount in dispute. Alternatively, clients can opt for legal fees on a competitive hourly basis.
In addition, Aceris Law regularly advises clients on third-party funding (TPF), assists in the preparation of funding memoranda, and supports clients throughout the funding process to help secure the necessary financial resources to pursue or defend investment arbitrations effectively.
D. Expert Fees
Expert evidence is frequently used in international arbitration. Experts are appointed by parties to give their independent opinion on issues beyond the arbitral tribunal’s expertise, such as quantum or foreign law, often in the form of expert reports and expert testimony at the hearing, thereby assisting the arbitral tribunal in its decision-making process.
Therefore, if such evidence is necessary, parties choose the expert they wish to appoint and pay for their fees and expenses.
Generally, parties should budget between USD 150,000 and USD 500,000 for a competent expert per case. These fees vary depending on the expert’s specialization, experience, and the scope of work, and should always be carefully negotiated in advance. The fees of a party-appointed expert cannot be linked to the outcome of the case in order to preserve the impartiality and independence of the expert.
E. Hearing Costs
Hearing costs in ICSID arbitrations can vary considerably depending on whether the proceedings are held in person or remotely, and whether they take place at ICSID’s own facilities or elsewhere. These expenses are typically paid from the parties’ advances on costs, except where the use of ICSID’s own premises is covered by the annual administrative fee:
- Hearings at ICSID’s facilities: When hearings are held at ICSID’s headquarters in Washington, D.C., the use of hearing and breakout rooms at the World Bank premises is included in ICSID’s annual administrative charge of USD 52,000. No additional room rental fees are billed to the parties.
- Remote hearings: For hearings conducted virtually using ICSID’s secure online platform, the cost is approximately USD 2,500 per day, which is paid from the advances on costs.
- External venues: When hearings are held at locations other than ICSID’s facilities, the venue rental fees and logistical expenses (such as audio-visual equipment and on-site support) are not included in the administrative charge and are instead paid from the parties’ advances on costs.
In addition to these institutional costs, parties must budget for their own hearing-related expenses, including the travel and accommodation of the legal teams, witnesses, and experts.
The secretary’s travel expenses and attendance fees, as well as court reporting and transcription services, interpretation or translation services, and logistical expenses such as meals, coffee breaks, and audio-visual support, are usually organized by ICSID and deducted from the parties’ advances on costs as direct case-related expenses.
ICSID arbitrations may also be bifurcated, meaning that the proceedings are divided into separate stages, such as a jurisdictional phase followed by a merits or liability phase. In some cases, proceedings can even be trifurcated into three distinct phases: jurisdiction, merits, and quantum (damages). This procedural structure often requires multiple hearings and can therefore result in additional costs for the parties.
Hearing costs may later be recovered or reallocated in the final award.
F. Other Costs
Parties must also consider that other minor, discrete costs may arise throughout the arbitration process.
For example, arbitration often involves a document production phase, in which a party may request that the opposing party produce documents relevant to the case. In some cases, this may require a party to review a great number of documents to produce the specific category requested, which can take time and lead to the generation of additional expenses.
As another example, in some instances, tribunals may request that submissions be made both electronically and in hard-copy format or via flash drive. In these cases, parties must also pay for printing and/or the necessary equipment, as well as courier services, in order to fulfill the tribunal’s request.
Additionally, if documentary evidence referred to in the arbitration is in a language other than that of the arbitration or if witnesses speak different languages, parties should plan to spend additional funds on translations.
G. Recent Statistics and Trends on the Costs of ICSID Arbitration
According to a 2021 study of over 400 investor-State cases, the average party costs in investment arbitrations remain substantial. Investors incur mean costs of around USD 6.4 million (median ≈ USD 3.8 million), while respondent States spend on average USD 4.7 million (median ≈ USD 2.6 million). This marks a slight overall decline since 2017, though investor costs continue to exceed those of States in most cases. Tribunal costs averaged roughly USD 958,000-1.05 million (median ≈ USD 745,000-775,000).[11]
Earlier studies from the mid-2010s show that average party costs in investment-treaty arbitrations already ran into the multi-million-dollar range. For example, an analysis of ICSID arbitration proceedings concluded between 2011-2015 found that claimants spent on average USD 5,619,261.74, and respondents an average of USD 4,954,461.27.[12] In 2015, the European Commission suggested in a paper entitled “ISDS: some facts and figures” that the average total cost for a claimant in investment arbitration was approximately USD 8 million.[13] Earlier still, the Organisation for Economic Co‑operation and Development (OECD) reported in 2012 that legal and arbitration costs for claimants and respondents in ISDS cases averaged in excess of USD 8 million per party.[14]
While an ICSID arbitration at the total cost of USD 1.3 million per party is entirely feasible, these figures confirm that investment arbitration remains an expensive process, with tribunal and administrative expenses forming only part of the overall financial burden, the majority stemming from party representation and expert fees.[15]
II. Allocation of the Arbitration Costs by the Arbitral Tribunal
According to Article 61(2) of the ICSID Convention, unless the parties have agreed otherwise, it is for the tribunal to determine how and by whom the costs of the arbitration are to be paid, and this decision forms part of the final award.[16] The provision itself does not set out any specific criteria for allocating costs;[17] instead, it grants the tribunal broad discretion to decide how costs should be apportioned in each case.[18]
Under Rule 52 of the ICSID Arbitration Rules, when making this decision, tribunals may take into account various factors such as:
- the outcome of the proceedings;
- the conduct of the parties during the proceedings, including the extent to which they acted in an expeditious and cost-effective manner;
- the complexity of the issues; and
- the reasonableness of the costs claimed.
The practice of ICSID tribunals in apportioning costs is not uniform.[19] Principles typically applied by tribunals are the “equal sharing” of costs (or the so-called American rule) and the “costs follow the event” (or the “loser pays”) principle.[20]
Traditionally, investment arbitration has followed the principle of equal cost sharing, meaning that each party pays half of the tribunal’s fees and administrative charges and covers its own legal and preparation expenses.[21] This rule is often justified on the grounds that it promotes predictability and avoids lengthy debates over costs, thereby enhancing efficiency and keeping overall expenses reasonable.
Under the “costs follow the event” or “loser pays” principle, the unsuccessful party is required to cover both the arbitration costs and the legal expenses of the successful party. This principle may also be applied proportionally, with each party bearing costs according to the extent of its success or failure in the case. This is also known as the “relative success” rule. In such situations, a partial cost-shifting occurs, meaning the losing party pays a larger portion of the arbitration expenses and partially compensates the prevailing party for its legal costs.[22] The reasoning behind this principle is that a party wronged by an unlawful act should be reimbursed for the costs of pursuing its claim, while a party that successfully defends against an unfounded claim should be compensated for the expenses incurred in doing so.[23]
Conclusion
ICSID arbitrations remain costly, with the largest portion of expenses arising from the parties’ own legal and expert fees, while tribunal and administrative costs add further to the overall financial burden. In addition to the costs described above, parties must keep in mind that even after obtaining an ICSID award, they might also have to budget for potential enforcement proceedings if the losing party fails to voluntarily comply with the award.[24]
If you are considering initiating an ICSID arbitration or are a State facing an ICSID claim and have questions about the potential costs, please feel free to contact Aceris Law for more information. Drawing on our extensive experience representing both investors and States in numerous investment arbitrations under the ICSID Rules and sitting as arbitrators in some of the largest investment cases to date, we can provide clear guidance, strategic advice, and transparent cost estimates tailored to your case.
[1] Aceris Law offers reasonable, capped legal fees for both investors and States, and provides an online Arbitration Legal Fee Calculator to help determine costs based on the amount in dispute.
[2] ICSID Arbitration Rules, Rule 50 Costs of the Proceeding (“The costs of the proceeding are all costs incurred by the parties in connection with the proceeding, including: (a) the legal fees and expenses of the parties; (b) the fees and expenses of the Tribunal, Tribunal assistants approved by the parties and Tribunal-appointed experts; and (c) the administrative charges and direct costs of the Centre.”)
[3] Chapter III of the ICSID Administrative and Financial Regulations outlines the financial provisions governing the Centre’s operations. Regulations 14 to 18 specifically address the financing of individual cases, including arbitrators’ fees and expenses, administrative fees payable to the Centre, and the filing fee required to initiate proceedings, see H-T. Shin and S. Seo, Part 1: ICSID Administrative and Financial Regulations, Chapter III: Financial Provisions [Regulations 14-22], in R. Happ and S. Wilske, ICSID Rules and Regulations 2022: Article-by-Article Commentary (2022), pp. 38-59.
[4] H-T. Shin and S. Seo, Part 1: ICSID Administrative and Financial Regulations, Chapter III: Financial Provisions [Regulations 14-22], in R. Happ and S. Wilske, ICSID Rules and Regulations 2022: Article-by-Article Commentary (2022), pp. 38-59.
[5] ICSID Administrative and Financial Regulations, Regulation 15(1)(b).
[6] ICSID Administrative and Financial Regulations, Regulation 15(1)(c).
[7] H-T. Shin and S. Seo, Part 1: ICSID Administrative and Financial Regulations, Chapter III: Financial Provisions [Regulations 14-22], in R. Happ and S. Wilske, ICSID Rules and Regulations 2022: Article-by-Article Commentary (2022), pp. 38-59.
[8] ICSID Administrative and Financial Regulations, Regulation 14 Fees, Allowances and Charges (“(1) Each member of a Commission, Tribunal or Committee shall receive: (a) a fee for each hour of work performed in connection with the proceeding; (b) reimbursement of expenses reasonably incurred for the sole purpose of the proceeding when not travelling to attend a hearing, meeting or session; and (c) when required to travel to attend a hearing, meeting or session held away from the member’s place of residence: (i) reimbursement of the cost of ground transportation between the points of departure and arrival; (ii) reimbursement of the cost of air and ground transportation to and from the city in which the hearing, meeting or session is held; and (iii) a per diem allowance for each day spent away from the member’s place of residence. (2) The Secretary-General, with the approval of the Chair, shall determine and publish the amount of the fee and the per diem allowance referred to in paragraph (1)(a) and (c). Any request by a member for a higher amount shall be made in writing through the Secretary-General, and not directly to the parties. Such a request must be made before the constitution of the Commission, Tribunal or Committee and shall justify the increase requested. (3) The Secretary-General shall determine and publish an annual administrative charge payable by the parties to the Centre. […]”)
[9] See, e.g., ICSID Convention, Article 3 (“The Centre shall have an Administrative Council and a Secretariat and shall maintain a Panel of Conciliators and a Panel of Arbitrators.”) and Article 9 (“The Secretariat shall consist of a Secretary-General, one or more Deputy Secretaries-General and staff.”).
[10] ICSID, Schedule of Fees (2023) (“An administrative charge of US$52,000 is levied by the Centre upon the registration of a request for arbitration, conciliation or post-award proceeding and annually thereafter. […] Additional charges include: US$200 hourly when the Secretary of the Commission, Tribunal or Committee attends meetings; reimbursement of the travel and subsistence expenses of the Secretary when the meetings are held away from the seat of the Centre; and any charges by the host of the meetings.”).
[11] M. Hodgson et al., 2021 Empirical Study: Costs, Damages and Duration in Investor-State Arbitration, June 2021.
[12] J. Commission, The Duration and Costs of ICSID and UNCITRAL Investment Treaty Arbitrations; see also Aceris Law, The Cost of Investment Arbitration: UNCITRAL, ICSID Proceedings and Third-Party Funding.
[13] J. Commission, How Much Does an ICSID Arbitration Cost? A Snapshot of the Last Five Years, February 2016, https://legalblogs.wolterskluwer.com/arbitration-blog/how-much-does-an-icsid-arbitration-cost-a-snapshot-of-the-last-five-years/ (last accessed 6 November 2025).
[14] J. Commission, How Much Does an ICSID Arbitration Cost? A Snapshot of the Last Five Years, February 2016, https://legalblogs.wolterskluwer.com/arbitration-blog/how-much-does-an-icsid-arbitration-cost-a-snapshot-of-the-last-five-years/ (last accessed 6 November 2025).
[15] For practical guidance on minimizing the overall cost of investment treaty arbitration, including strategies for efficient case management, selection of cost-effective experts, and capped legal fees, see Aceris Law, How to Reduce the Overall Cost of Investment Treaty Arbitration to Less than USD 1 Million.
[16] ICSID Convention, Article 61(2) (“In the case of arbitration proceedings the Tribunal shall, except as the parties otherwise agree, assess the expenses incurred by the parties in connection with the proceedings, and shall decide how and by whom those expenses, the fees and expenses of the members of the Tribunal and the charges for the use of the facilities of the Centre shall be paid. Such decision shall form part of the award.”)
[17] S. W. Schill et al., ICSID Convention, Article 61 [Apportionment of Expenses], in S. W. Schill et al., Schreuer’s Commentary on the ICSID Convention (3rd ed., 2022), pp. 1625-1662.
[18] See, e.g., Astrida Benita Carrizosa v. Republic of Colombia, ICSID Case No. ARB/18/5, Award, 19 April 2021, paras. 231-232.
[19] S. W. Schill et al., ICSID Convention, Article 61 [Apportionment of Expenses], in S. W. Schill et al., Schreuer’s Commentary on the ICSID Convention (3rd ed., 2022), pp. 1625-1662.
[20] S. W. Schill et al., ICSID Convention, Article 61 [Apportionment of Expenses], in S. W. Schill et al., Schreuer’s Commentary on the ICSID Convention (3rd ed., 2022), pp. 1625-1662.
[21] S. W. Schill et al., ICSID Convention, Article 61 [Apportionment of Expenses], in S. W. Schill et al., Schreuer’s Commentary on the ICSID Convention (3rd ed., 2022), pp. 1625-1662; see, e.g., EDF International S.A., SAUR International S.A. and León Participaciones Argentinas S.A. v. Argentine Republic, ICSID Case No. ARB/03/23, Award, 11 June 2012, para. 1345 (“Having considered the Parties’ arguments, the Tribunal finds that both sides have presented some meritorious arguments, each side winning on some issues while losing on others. The Tribunal thus finds appropriate to direct each side to bear its own legal expenses, including fees for attorneys and experts. The costs of arbitration, including the fees of the arbitrators and the administrative expenses of the Centre, shall be divided on an equal (50/50) basis.”); see also Mr. Franck Charles Arif v. Republic of Moldova, ICSID Case No. ARB/11/23, Award, 8 April 2013, paras. 631-632 (“In the current case, Claimant has been successful on the issue of jurisdiction, has established a breach by Respondent of the fair and equitable treatment standard of the France-Moldova BIT, and has established his right to restitution and damages. On the other hand, his claims for expropriation, denial of justice and moral damages have failed, as well as his claims of specific undertakings, unreasonable or arbitrary measures, full protection and security, discrimination and compensation. The questions of liability and the quantification of damages in relation to the border stores occupied a significant part of the proceedings. The Tribunal is not satisfied that Respondent’s jurisdictional objections justify an award of costs in favour of Claimant. For these reasons, the Tribunal decides that each party should bear equally the costs and expenses of the arbitration, and each party should bear its own legal fees and costs.”); Ioan Micula, Viorel Micula, S.C. European Food S.A, S.C. Starmill S.R.L. and S.C. Multipack S.R.L. v. Romania [I], ICSID Case No. ARB/05/20, Award, 11 December 2013, paras. 1327-1328.
[22] See, e.g., Joseph Charles Lemire v. Ukraine, ICSID Case No. ARB/06/18, Award, 28 March 2011, para. 380 (“The traditional position in investment arbitration is to split the arbitration costs equally among the parties. The Arbitral Tribunal, however, welcomes the newly established and growing trend, that there should be an allocation of costs that reflects in some measure the principle that the losing party should contribute in a significant, if not necessarily exhaustive, fashion to the fees, costs and expenses of the arbitration of the prevailing party.”); see also BSG Resources Limited, BSG Resources (Guinea) Limited and BSG Resources (Guinea) SÀRL v. Republic of Guinea, ICSID Case No. ARB/14/22, Award, 18 May 2022, paras. 1118-1120 (“It is uncontroversial that Article 61(2) of the ICSID Convention grants the Tribunal discretion in allocating the ICSID arbitration costs and the Parties’ costs, including legal fees. Overall, ICSID tribunals have followed two approaches to costs. In the first approach, ICSID costs are apportioned in equal shares and each party bears its own costs, whereas in the second approach, the principle ‘costs follow the event’ implies that the losing party bears the costs of the proceedings, including those of the other party, or that the parties bear the costs proportionately to their success or failure. In between these two approaches, solutions vary depending on the weight the Tribunal may place on various circumstances, including the conduct of the Parties in the arbitration and other parameters. In the circumstances of this case, the Tribunal considers it appropriate to apply the ‘costs follow the event’ principle.”); TECO Guatemala Holdings, LLC v. Republic of Guatemala, ICSID Case No. ARB/10/23, Award (Resubmission Proceedings), 13 May 2020, pp. 150-154.
[23] S. W. Schill et al., ICSID Convention, Article 61 [Apportionment of Expenses], in S. W. Schill et al., Schreuer’s Commentary on the ICSID Convention (3rd ed., 2022), pp. 1625-1662.
[24] Aceris Law, Enforcement of Investment Arbitration Awards.
