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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.

An energy investment treaty has been holding Nord Stream 2 hostage
28-Feb-2022 Climate Home News
The German government has been worried about being sued by the fossil fuel companies behind the Russian gas pipeline under the Energy Charter Treaty.
India pays back Cairn Rs 7,900 crore to settle over 7-year-old retro tax dispute
25-Feb-2022 The Times of India
The company, which is now known as Capricorn Energy PLC, in a statement said it has received "net proceeds of $1.06 billion", of which nearly 70 per cent will be returned to the shareholders.
Monterra Energy to seek $667 mln in damages from Mexico for port closure
23-Feb-2022 Reuters
Monterra Energy plans to pursue legal action against Mexico and seek damages of about $667 million for the "unlawful" closure of its Tuxpan fuel imports terminal in the Mexican state of Veracruz for five months.
A Koched-up NAFTA lawsuit
22-Feb-2022 CCPA
Koch claims that Ontario’s abrupt cancellation of its cap-and-trade system in 2018 violated the NAFTA Chapter 11 minimum standard of treatment and expropriation clauses.
Toxic mine to re-open after Australian gold miner sues Thai Government
15-Feb-2022 AFTINET
Environmental defenders in Thailand have slammed a decision by the Thai Government to reinstate formerly revoked mining licenses following a lengthy legal battle in an international arbitration tribunal.
Qatar faces $6 billion arbitration claim linked to ruling family member
15-Feb-2022 Forbes
The Qatari government is facing a $6 billion international arbitration claim stemming from a case against a member of the country’s ruling family.
Canada’s Alberta province files trade challenge over scrapped Keystone XL pipeline
10-Feb-2022 Reuters
The Canadian province of Alberta formally initiated a trade challenge to recover its investment in the Keystone XL oil pipeline, which was scrapped in 2021 after the United States cancelled a key permit.
UAE signs agreement on mutual promotion and protection of investments with Mozambique
9-Feb-2022 Emirates News Agency
The agreement protects both nations’ investments from all non-commercial risks, covers transfer of profits and revenues, and facilitates resolving disputes.
Thai Prime Minister under fire over reopening of Australian gold mine
8-Feb-2022 The Sydney Morning Herald
The mine was shut amid accusations of villagers being poisoned by leaking toxic waste. Kingsgate, whose Thai subsidiary Akara Resources had operated the mine since 2001, filed an international arbitration lawsuit.
Primer on international investment treaties and investor-state dispute settlement
4-Feb-2022 CCSI
While reforms are being discussed, investors will continue to bring, and states will continue to defend, claims in an ISDS system now widely recognized as suffering from perceived and actual concerns going to its very legitimacy.
Mexico seeks to settle $1.1 bln Vulcan suit over limestone mine closure
4-Feb-2022 Reuters
The Mexican government said on Thursday that it is negotiating the settlement of a $1.1 billion lawsuit by Vulcan Materials Co over a government effort to shutter its limestone mine.
Devas shareholders move another arbitration
4-Feb-2022 The Hindu
The shareholders are seeking compensation commensurate with an arbitration award of $1.3 billion and have demanded that since Devas has been wound up, India must pay the award directly to the claimants.
Huawei takes Sweden to court following 5G ban
31-Jan-2022 Dunya News
Huawei said that it has initiated arbitration proceedings against Sweden under the World Bank Group after the Nordic country banned the Chinese tech giant from rolling out its 5G products.
UK, Switzerland accused of undermining EU green treaty reforms
26-Jan-2022 Climate Home News
Campaigners say the UK and Switzerland are defending fossil fuel interests in Energy Charter Treaty modernisation talks to tempt firms to relocate their HQs.
Investor–state disputes in the fossil fuel industry
24-Jan-2022 IISD
The fossil fuel industry is the most litigious industry in the ISDS system by number of cases, accounting for almost 20% of the total known ISDS cases across all sectors.
‘Breakthrough’ as Pakistan, TCC agree over share in Reko Diq case
21-Jan-2022 Ary News
Pakistan and Tethyan Copper Company (TCC) have agreed over 50 percent shares, likely paving way for averting a multi-billion-dollar fine imposed on Pakistan.
Energy Charter Treaty claim pushes Slovenia to weaken fracking rules
17-Jan-2022 Friends of the Earth Europe
A new example of how this secretive corporate court system is undermining climate and environmental policies of EU member states has been brought to light.
Cop26 targets pushed back under threat of being sued
17-Jan-2022 Capital Monitor
Countries party to the Energy Charter Treaty are under yet more pressure to reform the agreement following the Cop26 climate summit, as they weigh the benefits of climate action against the likelihood of getting sued.
Romania wins EUR 2 bln dispute at ICSID against Romanian-Swedish investors Micula
6-Jan-2022 Romania-Insider
A committee attached to the Washington International Court (ICSID) definitively rejected the €1.8 bln claims of Romanian-Swedish investors Ioan and Viorel Micula.
Devas seizes $6.8 million worth of AAI property in Canada
3-Jan-2022 The Hindu
The shareholders had sought the right to seize all sum or moveable property of India and/or AAI being held by the International Air Transport Association.