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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.

Ecuador: Oxy’s demands for compensation unfounded
6-Feb-2010 EFE
The Ecuadorian government said Occidental Petroleum deserves no compensation for the cancellation of its massive oil concession in the Amazon region, arguing that the decision was taken after the U.S. company broke the law and its contractual obligations by handing over a stake in that project to a Canadian firm.
Chevron files motion to hold government of Ecuador accountable under international law
22-Jan-2010 SR Sentinel
Chevron has submitted a legal motion and supporting authorities to dismiss a lawsuit that was filed by the government of Ecuador in an attempt to block a Chevron arbitration claim made under international treaty la
Ecuadorians want Chevron held to account
19-Jan-2010 Courthouse News
Now, Texaco is asking a panel of United Nations Commission on International Trade Law, which works in cooperation with the World Trade Organization, to release it from environmental liability, the communities say.
Spanish firms launch ICSID dispute against Mexico over stalled toxic waste disposal project
13-Jan-2010 ITN
Spanish firms Abengoa, S.A. and COFIDES, S.A. have launched a claim with ICSID against Mexico over the stalled opening of a toxic waste disposal plant built by them in the municipality of Zimapán, approximately 200 kilometres north of Mexico City.
Ecuador seeks to block Chevron
7-Dec-2009 WSJ
The government of Ecuador asked a US court on Friday to intervene in its long-running environmental battle with oil giant Chevron Corp.
German investor launches ICSID case against Costa Rica over alleged expropriation of land near endangered turtle habitat
7-Dec-2009 ITN
German investor Reinhard Unglaube, a resident of Costa Rica, has commenced arbitration against his host country over the latter’s refusal to grant the appropriate permits to extend his eco-tourist hotel complex in Playa Grande, Costa Rica.
Quiborax claim against Bolivia continues; may provide first decision on effects of ICSID exit
5-Nov-2009 ITN
Chilean Química e Industrial del Bórax Ltd. (“Quiborax”) will continue with its claim against Bolivia at the International Centre for Settlement of Investment Dispute (“ICSID”), despite reports of a settlement agreement and Bolivia’s renunciation of the ICSID convention. The case will likely shed the first light as to the effects of renouncing the ICSID Convention, a controversial topic over which no tribunal has yet to rule.
Ecuador prepares for new hearings in Occidental case
31-Oct-2009 Dow Jones Newswires
Occidental is seeking $3.2 billion in damages for Ecuador’s May 2006 decision to cancel the company’s operating contract
Claim by Cargill leads to another loss for Mexico
9-Oct-2009 IISD
Mexico has suffered another loss in a series of investor-state arbitral disputes involving its sugar industry.
Ad Hoc Committee confirms Argentina is on the hook to Azurix for US$165 Million
6-Oct-2009 IISD
Marking a final setback for Argentina in its protracted dispute with US-based water services firm Azurix Corp, on 1 September 2009 an ad hoc committee denied Argentina’s application to annul an ICSID tribunal’s previous decision awarding Azurix approximately US$165 Million for breach of Argentina’s obligations under the US-Argentina Bilateral Investment Treaty.
Eureko secures exit from Polish PZU row
2-Oct-2009 IPE
An agreement has been signed between the Polish Ministry for State Treasury and Eureko to pay the insurer an interim dividend in November 2009 worth €1.85bn.
Ecuador criticizes Chevron arbitration claim
25-Sep-2009 Reuters
Ecuador accused Chevron Corp on Thursday of filing an international arbitration claim against the country in an attempt to shield itself against losing a $27 billion environmental damage lawsuit.
Chevron takes Ecuador fight to arbitrators
24-Sep-2009 Financial Times
Chevron, the world’s third biggest oil company, said it had filed an international arbitration claim against the government of Ecuador, citing violations of the country’s obligations under the US-Ecuador bilateral investment treaty, investment agreements and international law.
ICSID rejects Turkish Co $756m claim against Pak
7-Sep-2009
An arbitral tribunal appointed by the International Centre for Settlement of Investment Disputes (lCSID) of the World Bank hearing a claim brought by a Turkish investor against the Islamic Republic of Pakistan has rejected all claims for breach of a bilateral investment treaty between the two countries.
Corn Products awarded damages in NAFTA dispute
21-Aug-2009 World-Grain.com
US-based Corn Products International has been awarded damages of over $58m in a dispute with Mexico over violations of the North America Free Trade Agreement.
Ecuador shakes up international fora
6-Aug-2009 ICTSD
Exiting ICSID and joining ALBA and UNASUR,along with the customs restrictions it applied on its CAN neighbours, are the recent measures that have been taken by the government of Ecuador to demonstrate that there is an alternative trade policy.
When managed investment funds are not "investors" for the purpose of seeking protection under BITs
30-Jun-2009 Clayton Utz
Some managed investment funds may not be able to seek protection under bilateral investment treaties when investing abroad, according to a recent award rendered in an investment treaty arbitration between a various Spanish investment funds and the Russian Federation (Renta 4 S.V.S.A v Russian Federation).
Argentine crisis arbitration awards pile up, but investors still wait for a payout
25-Jun-2009 Law.com
It’s time for the US Department of State to pressure Argentina to comply with its treaty obligations, some lawyers suggest.
Human rights and BITs: Mapping the role of human rights law within investor-state arbitration
22-Jun-2009 Rights & Democracy
Investment treaties and free trade agreements offer few instructions as to how such agreements should be reconciled with human rights obligations of the state.
Goldcorp loses bid for $50 mln NAFTA compensation
11-Jun-2009 Reuters
A unit of Goldcorp has lost a bid to get $50 million in compensation after a US trade tribunal rejected claims the gold miner’s operations were hampered by environmental regulations