<![CDATA[The proliferation of Third-Party Funding (TPF) within Investor-State Dispute Settlement (ISDS) has transformed international arbitration into a speculative asset class, jeopardizing host states' fiscal sovereignty. This article examines the structural vulnerabilities arising from the regulatory vacuum in domestic arbitration frameworks, specifically within the Indonesian legal system. While existing scholarship predominantly focuses on multilateral reforms, this study argues that the absence of domestic lex arbitri oversight facilitates predatory litigation and engenders "regulatory chill." Employing normative legal research with a comparative analysis of Singapore, Hong Kong, and the IA-CEPA standards, the research demonstrates that domestic legislative intervention is a prerequisite for sovereign resilience. The study proposes a comprehensive reconstruction of the National Arbitration Law through three pivotal pillars: precise statutory definitions, mandatory disclosure of funding identities, and the empowerment of tribunals to impose security for costs. These reforms are essential to rebalance investment protection with the preservation of host states' public space.]]>
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