Following an examination of primary sources on the origination of investment arbitration in the 1950s and 1960s, the thesis demonstrates that the historical narrative in legal textbooks ignores a crucial period at the time of its formation concerning the organic development of international law as the overreaching corrective in investment disputes, including international arbitration practice as the applicable dispute resolution mechanism. By scrutinizing decisions of national and international courts, legal literature, and state practice before and during this period, the author demonstrates that the arbitral awards relied on by the legal textbooks, which are based on the internationalization doctrine, are in clear contrast to the prevailing national and international doctrines at the time, and thus cannot be used as a valid basis for an organic development of the law.