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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.

$4.7 bln Lone Star case will begin next week
6-May-2015 Korea Times
V.V. Veeder, a British national, has been appointed as the presiding arbitrator for a $4.7 billion international litigation between the Korean government and Dallas-based Lone Star Funds, sources said Tuesday.
A parade of reforms: The European Commission’s latest proposal for ISDS
6-May-2015 Social Sciences Research Network
The European Commission’s most recent proposal for ISDS reflects a move away from fake reforms to something potentially more meaningful, but it is insufficient and unreliable, says legal expert Gus Van Harten.
UN calls for suspension of TTIP talks over fears of human rights abuses
6-May-2015 The Guardian
Alfred de Zayas said the UN will publish a report in August to illustrate the flaws in current plans for the TTIP.
EU’s trade chief wants special court for investor disputes
5-May-2015 Reuters
The EU’s trade chief proposed on Tuesday creating a new European court to settle disputes in international trade agreements, a step aimed at overcoming growing public resistance to a free-trade accord with the United States.
Controversy flares over ex-KEB chief’s new role with Lone Star’s law firm
4-May-2015 Korea Herald
A former top financial official who advocated for Korea Exchange Bank’s breakaway from Lone Star has taken up a position in a law firm that represents the US buyout firm at a time when the firm is suing the Korean government for $4.6 billion in an investor-state dispute.
‘Hanocal may sue Korean government over sale of Hyundai Oilbank’
4-May-2015 Korea Herald
The Dutch company will file an ISDS application against the Korean government, should the authorities refuse to pay 183.5 billion won ($169.9 million) in tax refund.
Corporate power ‘exorcism’ held outside London law firm billed for TTIP lawsuits
4-May-2015 RT
A group of radical performance activists who hail from New York staged an “exorcism” of corporate power outside an international law firm in London to raise awareness about the dangers of an EU-US trade deal being brokered behind closed doors.
Pol says TPP trade deal could jeopardize NYC laws
29-Apr-2015 City Limits
"We cannot tell President Obama what to do. [But] our hard fought victories for protecting the lives of all New Yorkers will be at risk if he signs the TPP."
Is TPP trade deal a massive giveaway to major corporations? An exchange between Obama and Sherrod Brown
28-Apr-2015 Washington Post
Obama leans hard into the idea that TPP’s ISDS will be drawn explicitly to prevent corporate gaming of the litigation process
TUC’s Owen Tudor: ’We are totally opposed to TTIP’
24-Apr-2015 EurActiv
Shrouded with secrecy and posing a threat to public services, Owen Tudor tells EurActiv why the UK Trade Union Congress doesn’t believe the hype over TTIP, and why exploitation, rather than immigration, should be the cause of people’s concerns.
UN expert says secret trade deals threaten human rights
24-Apr-2015 Reuters
Secret negotiations on international trade deals threaten human rights, an independent United Nations expert said on Thursday in comments that appeared aimed at agreements the United States is seeking with the European Union and Pacific nations.
PACER-plus chapter on Investment draft text (November 2013)
23-Apr-2015 PINA
This is the leaked draft chapter on Investment text from the PACER Plus Intersessional meeting in Auckland, 26-28 November 2013.
Brazil has signed Investment Cooperation and Facilitation agreements with Mozambique and Angola
23-Apr-2015 Lexology
The ICFAs open a door to arbitration, providing an alternative to the local courts, but State-to-State, not investor-State.
Parliament’s opposition to TTIP arbitration on the rise
21-Apr-2015 EurActiv
Half of the European Parliament’s committees have rejected the Transatlantic Trade and Investment Partnership’s investor-state dispute settlement mechanism, casting doubt over the trade deal’s prospects of to passing through Parliament.
El Salvador, Water is more precious than gold
15-Apr-2015 ITUC
The International Trade Union Confederation calls on the government of El Salvador to denounce all treaties establishing ISDS proceedings.
Will El Salvador be forced to pay $301 million for valuing clean water over gold?
15-Apr-2015 Equal Times
The Central American state of El Salvador could be forced to pay US$301 million in damages to an Australian-Canadian mining company, OceanaGold, after the company’s application for a mining license was rejected on the basis of the projected environmental damage it would cause.
High time for a global investment agreement
15-Apr-2015 South China Morning Post
In terms of international transactions, FDI is more important than trade but it is subject to global policy disarray.
Lobby group EFILA’s stake in investment arbitration
14-Apr-2015 TNI
In response to growing public criticism of international investment law, a new lobby group has emerged, EFILA, seeking to influence European officials.
Disputes between States and multinationals - The paradigm: The dispute between Suez and Argentina
14-Apr-2015 Observatoire des Multinationales
An international arbitral tribunal has just ordered Argentina to pay nearly 400 million Euro to Suez because in 2006, after years of conflict, Argentina renationalized the water services in Buenos Aires.
Don’t sign agreements that erode workers’ rights
10-Apr-2015 Malaysia Kini
The Malaysian Trades Union Congress (MTUC) is most concerned about the serious implications of Investor-State Dispute Settlement (ISDS) clauses and provisions in the Trans-Pacific Partnership Agreement (TPPA) and other such agreements and treaties that Malaysia signs.