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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.

Singapore breaks new ground as arbitration hub
15-May-2015
The International Centre for Settlement of Investment Disputes hears its first case outside of US, France
First hearing opens over Lone Star asset sell-offs in Korea
15-May-2015
An international tribunal began hearing a multi-billion dollar case Friday that the US private equity firm Lone Star filed against South Korea’s government over tax and other disputes surrounding its asset sell-offs in Korea.
Against the Trans-Pacific Partnership
15-May-2015 Jacobin Magazine
Opponents of the trade deal being secretly negotiated between the United States, Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam have moved the discussion beyond its putative impact on jobs and growth and closer to the agreement’s broader ramifications, writes the IUF’s Peter Rossman.
UN blasts EU for backing global deal for ISDS, but not for country bailouts
14-May-2015 EurActiv
Richard Kozul-Wright, director at the United Nations Conference on Trade and Development (UNCTAD), said support for investor-state dispute settlement (ISDS) but not for state-investor was “incongruous”.
Hearing to begin this week in multi-billion-dollar battle between S. Korea, Lone Star
14-May-2015 Yonhap
An international tribunal will begin hearing a multi-billion dollar case this week that the US private equity firm Lone Star filed against South Korea’s government over tax and other disputes surrounding its asset sell-offs in Korea.
Leading scholars, former judges sign letter opposing Investor-State Dispute Settlement
13-May-2015 AFJ
A group of legal and economic luminaries have signed a letter to Congressional leaders urging them to oppose Investor-State Dispute Settlement (ISDS) provisions in proposed trade deals.
Investor-State Dispute Settlement: Review of Developments in 2014
13-May-2015 UNCTAD
According to UNCTAD, 40% of all new ISDS cases in 2014 were initiated against developed countries (the historical average is 28%). A quarter of them are intra-EU disputes.
Stop the suits tour: International investment agreements threaten people and the environment from El Salvador to Canada
12-May-2015 Mining Watch
In anticipation of an imminent ruling from a little-known arbitration tribunal at the World Bank that could force El Salvador to pay Canadian-Australian mining firm OceanaGold US$301 million, a Salvadoran delegation is visiting Canada to discuss how investor-state arbitration threatens democratic decision-making, public health and the environment here and beyond our borders.
US rejects EU calls for global investment court
11-May-2015 Press TV
The United States has rejected a European Union proposal to establish a global investment court aimed at resolving disputes arising from a massive free trade treaty with the US.
Egypt: Collateral costs of investment
11-May-2015 Zawya
Foreign investment is crucial for reviving Egypt’s economy, but a new report reveals it can come at a considerable cost, writes Stefan Weichert
No TTIP deal with ISDS, warns parliament
7-May-2015 The Parliament Magazine
MEPs have threatened to block TTIP if ISDS is included, despite revised plans presented to them by European trade commissioner Cecilia Malmström.
MEPs unimpressed with Commission’s ISDS proposal
7-May-2015 EurActiv
European Trade Commissioner Cecilia Malmström tried to convince MEPs that there are ways to keep the Investment-State Dispute Settlement in the Transatlantic Trade and Investment partnership deal. But unimpressed lawmakers failed to greet it as a full-fledged reform.
South Africa’s revocation of its bilateral investment treaties – analysis
6-May-2015 EurAsia Review
From an international policy point of view, South Africa’s denunciation of BITs is reasonable. It may even be seen as a refreshing retreat from a legal quagmire. But the domestic reality requires wider consideration.
Canada-EU trade deal faces more tinkering
6-May-2015 Macleans
Mission accomplished? Not quite. American negotiations with Europe may trigger more changes to CETA
$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.