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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.

South Korea to seek investor protection measures in FTA talks with China
12-Feb-2018 Yonhap News Agency
South Korea’s trade ministry said Monday it will seek ways to better protect investor rights from arbitrary regulations when holding talks with China to expand the scope of the two countries’ free trade agreement (FTA) to the service and investment sector.
Global mining firms sue Kenya for Sh334bn compensation
8-Feb-2018 Business Daily
Global mining firms want Kenya compelled to pay Sh334 billion as compensation for cancelling their licences.
Beijing plans new mechanism for Belt and Road arbitration
8-Feb-2018 Asia Times
In a proactive move, China has plans under way to provide its own arbitration in any future commercial issues or disputes between the Belt and Road countries. The 68 countries and regions included in the Belt and Road Initiative (BRI) not only vary in economic strength but also require a stable trade environment with adequate legal safeguards.
Congolese mines minister mum on whether controversial new code has been made law
7-Feb-2018 Business Day
International mining companies, which include Randgold, Glencore and China Molybdenum, have said they will challenge the new law through international arbitration, and are lobbying Kabila not to sign it.
United in mixity? The future of the EU common commercial policy in light of the CJEU’s recent case law
7-Feb-2018 EJIL: Talk!
The European Commission reportedly proposed a model for the fast track ratification of trade deals that should be applied for the first time to the new trade agreements with Australia and New Zealand.
Shifting trade winds: US bilateralism & Asia-Pacific economic integration
6-Feb-2018 Asia Society Policy Institute
Certain long-standing provisions of trade agreements, specifically ISDS, are worthy of reconsideration.
Belt and Road and the battle for global investment standards
6-Feb-2018 Asia Times
A new battle is taking shape on the world scene. It sees China and the West compete in affirming their respective investment standards around the globe.
Free trade fantasies: Canada must reject both NAFTA and TPP
5-Feb-2018 Global Research
Canadian Prime Minister Justin Trudeau has boasted of his commitment to progressive economic, environmental and social policies. At the same time, has been a passionate warrior in his pursuit and defence of so-called ‘free trade’ agreements.
Public-private partnerships and aid’s ’private turn’: addressing the investment law dimensions
1-Feb-2018 IIED
Where PPP projects turn sour, governments could be exposed to arbitration claims under applicable investment treaties.
Canadian NAFTA auto rules of origin idea ‘opposite’ of US goals: Lighthizer
30-Jan-2018 iPolitics
While “significant” challenges remain, all three ministers said some progress has been made this round.
Ecuador adopts a new approach towards foreign investment
30-Jan-2018 Lexology
Recent declarations made by members of the newly elected government of Ecuador reveal a reversal of its predecessor’s decision to denounce and withdrawal from the ICSID Convention, as well as all of Ecuador’s bilateral investment treaties
Towards a peoples charter on international trade agreements
30-Jan-2018 Parti Sosialis Malaysia
It is now time we open up the dialogue on the kind of trade agreements that we want to see in place.
Canada, Mexico tell US: Decide whether you want a NAFTA dispute settlement process
29-Jan-2018 CBC
Disputes over whether to opt out of investment section frustrating to Canada and Mexico.
Canada begins court fight to overturn NAFTA ruling on Digby quarry
29-Jan-2018 CBC
Ruling found that New Jersey company was wrongly prevented from opening quarry and terminal.
China to establish int’l courts to deal with Belt and Road Initiative cases
26-Jan-2018 The Tribune
China has decided to set up three international courts to deal with disputes related to its multi-billion dollar Belt and Road Initiative (BRI), under which it is making massive investments.
NAFTA talks focus on dispute settlement, autos
25-Jan-2018 Toronto Star
Canada has proposed that Canada and Mexico would agree to a dispute settlement process between their two countries alone — to be outlined in an annex to the NAFTA.
Pakistan’s arbitration woes: sifting myth from reality
22-Jan-2018 Express Tribune
The TCC tribunal failure did not reflect an internal failure on the part of Pakistan’s state apparatus as much as it did the hegemonic nature of the global BIT regime that developing countries have been subjected to by the West.
Sorainen and V&E successful for E-energija in ICSID arbitration against Latvia
19-Jan-2018 CEE Legal Matters
Latvia must compensate E-energija EUR 3.7 million for investment abuse in the district heating business.
Incoherence and uncertainty: Trump’s trade policy
16-Jan-2018 IATP
The actions of the Trump Administration and Congress have, in one year, established a pattern of cynical disregard for rural communities, hostility toward science, and an unbridled scorn for the principles and practice of democratic governance.
NAFTA’s Chapter 11 dispute mechanism too costly for Canada at $314M, says report
16-Jan-2018 660 News
Canada is currently facing eight active investor-state claims that combined seek more than $475 million in damages.