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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.

UNCTAD WIR 2012 launched
10-Jul-2012 UNCTAD
UNCTAD’s flagship publication, World Investment Report 2012: Towards a New Generation of Investment Policies, was launched on 5 July in Geneva by Dr. James Zhan, Director of the Investment and Enterprise Division, as well as by staff and collaborators worldwide.
US agrees to take disputes to Pakistani courts first
9-Jul-2012 Express Tribune
Amid calls to make public the draft of bilateral investment treaty, the government claims that it has gained much and lost nothing to the United States as Washington has agreed to first taking any business dispute to Pakistani courts for settlement.
TDM Call for papers "Aligning Human Rights and Investment Protection"
7-Jul-2012 Transnational Dispute Management
Transnational Dispute Management is currently preparing a special issue on "Aligning Human Rights and Investment Protection".
The dark side of investment agreements
6-Jul-2012 TNI
An animation which exposes how people are paying the costs of corporate lawsuits under international investment agreements.
SBY frets over int’l arbitration
2-Jul-2012
President Susilo Bambang Yu-dhoyono is telling his ministers to prepare for the worst after the government recently entered into arbitration with an international mining company.
French company, Veolia, launches claim against Egypt over terminated waste contract and labor wage stabilization promises
27-Jun-2012 IA Reporter
French multinational Veolia has had an ICSID arbitration claim registered against the Arab Republic of Egypt.
Kazakhstan wins the arbitration proceeding versus Caratube company
11-Jun-2012
On 5 June 2012 the arbitral tribunal of the International Centre for Settlement of Investment Disputes (ICSID) adopted the decision on the case initiated by Caratube International Oil Company LLP (CIOC) against the Republic of Kazakhstan.
Lone Star is back in town, armed with the investor-state dispute system

5-Jun-2012
In a May 31 press release, the US private equity fund Lone Star said it was planning to request investor state dispute (ISD) arbitration for losses suffered due to "unlawful" interference by the South Korean government.

Canadian miner’s complaint can proceed under El Salvador law
4-Jun-2012 Reuters
Canadian company Pacific Rim can move forward under El Salvador law with a case against that country’s government for blocking a gold mining project, but cannot file suit under a regional trade agreement, a World Bank arbitration panel ruled.
Churchill Mining files international arbitration against Indonesia
24-May-2012
Churchill Mining (LON:CHL) said it has now filed for international arbitration in its dispute regarding the East Kutai coal project (EKCP) in Indonesia, 75 per cent owned by Churchill.
Plain packaging risks lawsuits
21-May-2012
Smoking is bad for our health. Smoking is detrimental to our economic well-being - smoking-related conditions and diseases cost the health service in this country millions and millions of dollars each year. But moves to reduce or stop smoking in this country could cost us just as much if not more.
Leading US official rules out renegotiation of free trade pact
4-May-2012
Assistant U.S. Trade Representative Wendy Cutler ruled out renegotiation of the Korea-U.S. free trade agreement on Thursday, saying the deal had been in effect for just six weeks. Her comments foreshadowed a tough time for the Korean government’s efforts to revise the investor-state dispute settlement system under the accord.
Supreme Court recommends renegotiation of ISD clause
30-Apr-2012 The Hankyoreh
Controversial KORUS FTA clause could lead to ‘legal chaos’, says Korea’s top legal body
Treaties that gave away the store
27-Apr-2012
As India grapples with the Vodafone and 2G fallout, the Bilateral Investment Treaties it signed a few years ago are coming back to haunt it.
EU’s De Gucht: Argentina Risks Jeopardizing Trade Ties
24-Apr-2012
The European Union has warned Argentina that it risks jeopardizing trade ties over Buenos Aires’ plans to expropriate a unit of Spanish oil company Repsol YPF SA (REP.MC) and impose a series of import restrictions and that Brussels stands ready to take retaliatory action.
Study investment provisions before an FTA says advocacy group
20-Apr-2012
The country should carefully study investment provisions before entering into foreign trade agreements (FTAs) as these may infringe on government’s regulatory power on foreign firms, an advocacy group on Friday said.
Case note: How Chevron v. Ecuador is pushing the boundaries of arbitral authority
13-Apr-2012 IISD
The arbitral tribunal in Chevron v. Ecuador has taken a series of steps in recent months suggesting that it has a broad view of its authority.
India plans to abolish ISD clause in FTAs
6-Apr-2012
India plans to abolish the investor-state dispute system and renegotiate FTAs with South Korea, Singapore, and other countries, an Indian newspaper reported.
’We can’t even manage to send a lemon to the US,’ CFK
1-Apr-2012
President Cristina Fernández de Kirchner questioned US president Barack Obama’s recent decision to suspend trade benefits for Argentina, while complaining that “we can’t even manage to get one of our lemons to enter the US market.”
India to oppose Vodafone’s move to invoke BIPA pact
31-Mar-2012 Economic Times
The Indian government is likely to oppose any move by Vodafone Plc to invoke the India-Netherlands Bilateral Investment Promotion and Protection Agreement (BIPA) if it is forced to cough up Rs 12,000 crore in taxes on the grounds that the investment was routed through several step down firms based in different countries and that the treaty does not cover tax disputes.