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investor-state disputes | ISDS

Investor-state dispute settlement (ISDS) refers to a way of handling conflicts under international investment agreements whereby companies from one party are allowed to sue the government of another party. This means they can file a complaint and seek compensation for damages. Many BITs and investment chapters of FTAs allow for this if the investor’s expectation of a profit has been negatively affected by some action that the host government took, such as changing a policy. The dispute is normally handled not in a public court but through a private abritration panel. The usual venues where these proceedings take place are the International Centre for Settlement of Investment Disputes (World Bank), the International Chamber of Commerce, the United Nations Commission on International Trade Law or the International Court of Justice.

ISDS is a hot topic right now because it is being challenged very strongly by concerned citizens in the context of the EU-US TTIP negotiations, the TransPacific Partnership talks and the CETA deal between Canada and the EU.

Ortiz Construcciones y Proyectos S.A. v. Algeria’s arbitration
14-May-2020 Global Legal Chronicle
Spanish contractor Ortiz Construcciones y Proyectos S.A. lost an investment treaty arbitration against Algeria brought before ICSID.
The termination of bilateral investment treaties in the EU – one agreement to end them all?
11-May-2020 TaylorWessing
On 5 May 2020, 23 Member States of the EU entered into an Agreement for the Termination of Bilateral Investment Treaties between the Member States of the European Union.
Modernisation of the Energy Charter Treaty
10-May-2020 OpenExp
A global tragedy at a high cost for taxpayers.
Call for ISDS moratorium during COVID-19 crisis and response
7-May-2020 CCSI
We call on the world community for an immediate moratorium on all arbitration claims by private corporations against governments using international investment treaties.
Africa must not let disputes with foreign investors undermine its Covid-19 response
7-May-2020 Business Day
There is an imminent threat of claims arising from emergency measures, so countries should review how investor-state disputes are handled.
EU Member States sign an agreement for the termination of intra-EU bilateral investment treaties
6-May-2020 European Commission
23 EU Member States signed an agreement for the termination of intra-EU bilateral investment treaties.
Armenia ‘under pressure’ from UK and US over mining dispute, says EU report
6-May-2020 Open Democracy
An internal EU report claims that the UK government has pressured the Armenian government in a two-year standoff between protesters, an international mining company and the authorities.
EU plans to reform Energy Charter Treaty falling short, activists say
30-Apr-2020 Euractiv
An updated European Commission proposal to reform the Energy Charter Treaty is falling short of what’s needed to reinstate governments’ “right to regulate” in areas like climate change, activists say.
UN tribunal rules against Canada’s Edgewater in legal battle with Spain
27-Apr-2020 Mining.com
An arbitration tribunal ruled against Canadian company Edgewater Exploration in its long-standing legal battle with Spain related to the Corcoesto gold project in the northwestern region of Galicia.
Eni and Naturgy’s Damietta gas plant deal with Egypt falls through
24-Apr-2020 Nasdaq
In the meantime, Naturgy said it would go back to pursuing a legal claim to $2 billion in compensation its joint venture with ENI was awarded in the case by the World Bank’s ICSID in 2018.
Corporations prepare to sue over action to save lives as pandemic reveals trade flaws
23-Apr-2020 The Conversation
Global companies are positioning themselves to use little-known rules in trade agreements to claim millions of dollars in compensation for restrictions imposed during the pandemic.
Despite controversy, the Energy Charter Treaty is silently being pushed into Africa
21-Apr-2020 Euractiv
Joining the Energy Charter Treaty could cost developing countries money that is urgently needed to fight the COVID-19 pandemic and economic crisis.
Pandemic profiteers: how foreign investors could make billions from crisis measures
20-Apr-2020 TNI
Governments’ emergency actions in the wake of COVID-19 could prompt a wave of arbitration lawsuits for billions of dollars by multinational corporations and investment lawyers.
Peru warned of potential ICSID claims over covid-19 measures
17-Apr-2020 Latin Lawyer
Peruvian officials have warned that a proposed emergency measure suspending the collection of toll fees on the country’s road network in response to the outbreak of covid-19 could result in multiple ICSID claims.
Protecting against investor–state claims amidst COVID-19: A call to action for governments
16-Apr-2020 IISD
Governments are facing an imminent threat of investor–state arbitration as they take difficult decisions to support public health systems in a time of severe economic stress.
Silent expansion
15-Apr-2020 CEO
Many countries, particularly in the global south, are in the process of joining the Energy Charter Treaty despite the sweeping powers it grants to foreign investors.
Brazil India investment cooperation and facilitation treaty (2020)
10-Apr-2020 Modern Diplomacy
This is Brazil’s 10th and India’s 4th bilateral investment agreement since both nations had adopted their Model Bilateral Investment Treaty.
Investment treaty claims in pandemic times: Potential claims and defenses
9-Apr-2020 Kluwer Arbitration Blog
States around the world have taken a variety of measures seeking to stem the spread of COVID-19. It is likely that some foreign investors may seek relief and/or compensation for any losses resulting from State measures.
We need to talk about valuation in ISDS
2-Apr-2020 Verfassungsblog
Investors are receiving monetary damages that they would not be entitled to outside of ISDS, on the basis of an unjustified and highly reductive understanding of value.
Epidemic sovereignty? Contesting investment treaty claims arising from coronavirus measures
2-Apr-2020 EJIL:Talk!
Allegedly arbitrary or disproportionate measures, albeit in the public interest, provide regular grist for the mill of investment treaty arbitration.