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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.


Table of foreign investor-state cases and claims under NAFTA and other US “trade deals”
ISDS tribunals have ordered governments to pay corporations more than $989 million in compensation after ISDS attacks launched just under U.S. agreements.
The status of investor-state arbitration in Latin America in 2021
Last year saw a wave of cases against Latin American states, driven in particular, but not exclusively, by a large number of claims filed against Peru, Colombia and Mexico. This wave is likely to continue in 2021.
VI court freezes assets in $6b case
A Virgin Islands court has frozen shares in two hotels belonging to Pakistan’s national airline to enforce a $6 billion award levied through the World Bank’s ICSID.
Cairn threatens Indian asset seizures abroad in tax case
UK-based Cairn Energy Plc has threatened that it may be forced to begin attaching Indian assets including bank accounts in different world capitals, unless the government resolves the issue.
Keystone XL legal risks highlight dangers of putting investors before climate change
The owner of Keystone XL — TC Energy (previously TransCanada) — used NAFTA to launch a US$15 billion lawsuit in 2016 after President Barack Obama cancelled the project.
Against DCF valuation in ISDS: on the inflation of awards and the need to rethink the calculation of compensation for the loss of future profits
One of the most noticeable facts in recent ISDS is the spectacular inflation of compensation awarded to investors. The most important factor is probably the widespread use by tribunals of the DCF (discounted cash flows) valuation method.
Cairn Energy’s major investors ask India to honour arbitration
Investors have written to the Indian government as well as the governments of the US and UK seeking adherence to the award of a tribunal at the Permanent Court of Arbitration in The Hague
French controllers of Nuevo Pudahuel, operator of the Santiago airport, initiate ICSID proceedings against Chile
Nuevo Pudahuel had asked the Ministry of Public Works to extend the term of the concession contract as a result of the pandemic, but the MOP was closed to changes in the contract.
Analysis: How rich oil firms are using secretive court to fight capital gains tax in developing world
The battle between ConocoPhillips and Vietnam result could mark a significant shift in the way huge multinationals fight off the threat of taxes from desperate revenue authorities in developing countries.
Canada scrambles to salvage Keystone XL as Biden prepares to kill troubled pipeline project
Alberta believes there was a “very solid” legal basis to seek damages under international free trade agreements if the pipeline is effectively killed, said Alberta Premier
Mining operations – Submission of request for international arbitration to Chinese government
AsiaPhos has been in discussion with the Chinese Government (since November 2017) for a settlement in relation to the cessation of the mining activities because of the Panda Park.
TNCs reviving TPP Frankenstein
Corporate globalisation and Covid-19 should also have taught developing countries that they must reject FTAs strengthening IPRs, ISDS and TNCs in order to secure policy space to ’build back better’.
Investment protection in the EU-UK trade and cooperation agreement
The EU-UK agreement contains limited protections for investors and no investor-state enforcement mechanism. Its dispute resolution mechanism is limited to a “WTO-like” state-to-state arbitration.
Will Pakistan lose New York’s Roosevelt Hotel?
The Investor-State Dispute Settlement process has gone against developing countries for far too long.
China tried to punish European states for Huawei bans by adding eleventh-hour rule to EU investment deal
Draft text shows Beijing looked to withhold telecoms sector benefits to firms from countries with restrictions on Chinese telecoms companies.
The multinationals suing governments over their pandemic response
Law firms have been drawing investors’ attention to how they could pass their Covid-19-related losses onto states.
Chinese investors file arbitration case against Ukraine over Motor Sich investment
Chinese investors have brought a $3.5 billion arbitration case against Ukraine for blocking the sale of a strategic aircraft engine maker whose fate Washington is closely following.
Clive Palmer could seek ’unquantifiable’ commonwealth compensation under Singapore free trade deal
Australian taxpayers could be on the hook for compensation following a dispute between the Western Australian government and Clive Palmer’s Mineralogy, federal budget papers reveal.
Canada trade deal shows Government’s breathtaking arrogance
Important issues raised by CETA deserve more than a ludicrous 55-minute parliament debate.
EU-China comprehensive agreement on investment: A scoping study
Given China’s unique position, the study concludes that the EU must ensure that particularly strong protections for EU regulatory policy space are included in any future investment deal.