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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.


Costa Rica wins case against investors’ beach front property
ICSID tribunal rules Costa Rica was in its right to stop a tourist construction project on the Pacific coast that violated environmental laws.
Rethinking international investment governance: Principles for the 21st century
The Columbia Center on Sustainable Investment is hosting a two-day conference on rethinking international investment governance, which seeks to elaborate principles for a progressive investment agenda.
Tanzania cites bias as it changes laws governing arbitration
Tanzania has moved to ensure that investor disputes are resolved locally after Attorney General Adelardus Kilangi pushed through parliament the Public Private Partnership (Amendment) Bill, 2018.
More than 300 Republican and Democratic state legislators from all 50 states urge end of investor-state dispute settlement system in NAFTA
In letter to US Trade Representative, lawmakers say ISDS undermines state sovereignty and lawmaking.
Ecuador: Chevron’s victims vow to fight Hague court ruling
Victims of Chevron-Texaco’s pollution of the Ecuadorean Amazon have vowed to fight to protect the ruling which has granted them compensation.
ISDS reforms shove human rights under corporate red carpet
“We call on our governments to either address the real reasons why ISDS is fundamentally flawed or to abandon its ‘reform’ agenda that is designed to reinforce and re-legitimise a self-serving investment dispute system.”
The Permanent Court of Arbitration in The Hague rules against Ecuador, favors Chevron
Ecuador will be forced to pay economic reparations to the oil giant. The over 30,000 affected people in the Amazon haven’t received any compensation.
RCEP countries open to easing investment rules, agree to ease ISDS clauses
In a bid to fast-track the deal, most nations have agreed to ease the investor-state-dispute settlement (ISDS) clauses.
Letter of solidarity with the victims of Chevron
The signatories of this letter wish to express their rejection of this decision and their support for the people of Ecuador and the organizations that have defended the communities affected by Chevron Texaco.
US arbitration court can rule on Vattenfall’s German nuclear claim
A US arbitration court has rejected a German government petition that said the panel had no right to rule on a damages claim by Sweden’s Vattenfall. Berlin cited a ruling by the Court of Justice of the European Union.
RCEP talks: India manages major breakthrough
New Delhi won’t not take additional commitment on intellectual property rights beyond the TRIPS agreement it has already accepted at the WTO; investor-state dispute settlement (ISDS) mechanism only for limited sectors.
S. Korea discloses revised clauses of FTA with US
South Korea will collect public opinions on the recently revised free trade agreement with the United States before sending it to the parliament for approval.
ICSID condemns Egypt to pay €1,735 million to Naturgy and ENI for a gas plant
The Spanish group will seek an agreement with the country to recover normality at the Damietta plant.
Investment protection in EU Vietnam FTA
Vietnam and the EU have concluded their discussions on an Investment Protection Agreement, which they decided to keep it separate from their free trade agreement.
Spain sued over Popular resolution
Mexican billionaire Antonio del Valle has launched actions against the Spanish government for its role in the process of putting Banco Popular into resolution and subsequent sale for €1 to Santander.
Tourist trap: Is tourism’s explosive growth hurting countries?
Foreign investors in tourism have a long and successful history of using investor–state dispute settlement (ISDS) under investment treaties.
The 2018 draft Dutch model BIT: A critical assessment
The revised Dutch model BIT seems a missed opportunity to achieve a better balance between the rights and obligations of foreign investors.
Making the right to regulate in investment law and policy work for development: Reflections from the South African and Brazilian experiences
Despite challenges, the experiences of South Africa and Brazil demonstrate that there is room for genuine reimagination of the investment regime, where the interests of investors are matched with the development concerns of host countries.
Oil firms use secretive court hearing in bid to stop Vietnam taxing their profits
ConocoPhillips and Perenco try to stop £140m levy from sale of oilfields in key case for tax avoidance by multinationals.