Third Party Funding In International Investment Arbitration

Third-party funding has become one of the "hot topics" in investor-state arbitration. Parties, whether or not they are in financial distress, choose using funders to provide the financing to pay for their international arbitration proceedings. Financing includes the payment of some or all costs of the arbitral proceedings for one of the parties to the dispute. In return for this financial liability the funders receive a certain percentage of the finally awarded compensation or a certain multiple of their overall investment in the case.

Growing number of professional funders actively advertise and market their services for funding international arbitration proceedings. So how come the funders start to play an active role on this game? What are the primary reasons behind the recent advent of funding?