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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.

China to establish int’l courts to deal with Belt and Road Initiative cases
26-Jan-2018 The Tribune
China has decided to set up three international courts to deal with disputes related to its multi-billion dollar Belt and Road Initiative (BRI), under which it is making massive investments.
NAFTA talks focus on dispute settlement, autos
25-Jan-2018 Toronto Star
Canada has proposed that Canada and Mexico would agree to a dispute settlement process between their two countries alone — to be outlined in an annex to the NAFTA.
Pakistan’s arbitration woes: sifting myth from reality
22-Jan-2018 Express Tribune
The TCC tribunal failure did not reflect an internal failure on the part of Pakistan’s state apparatus as much as it did the hegemonic nature of the global BIT regime that developing countries have been subjected to by the West.
Sorainen and V&E successful for E-energija in ICSID arbitration against Latvia
19-Jan-2018 CEE Legal Matters
Latvia must compensate E-energija EUR 3.7 million for investment abuse in the district heating business.
Incoherence and uncertainty: Trump’s trade policy
16-Jan-2018 IATP
The actions of the Trump Administration and Congress have, in one year, established a pattern of cynical disregard for rural communities, hostility toward science, and an unbridled scorn for the principles and practice of democratic governance.
NAFTA’s Chapter 11 dispute mechanism too costly for Canada at $314M, says report
16-Jan-2018 660 News
Canada is currently facing eight active investor-state claims that combined seek more than $475 million in damages.
Bumpy road ahead for S. Korea-US FTA renegotiation: senior official
15-Jan-2018 Yonhap
A bumpy road lies ahead for the renegotiation of the free trade deal between South Korea and the United States, a Korean senior trade official said.
Mexico signs the ICSID Convention
12-Jan-2018 Public Now
Mexico’s Secretary of the Economy signed theConvention on the Settlement of Investment Disputes between states and nationals of other states.
Suez accepts 25% haircut from Argentina to end dispute
12-Jan-2018 Bloomberg
French co. agreed to $275 million to settle 12-year dispute. Engie is the biggest shareholder in water, sewer company.
The crisis of legitimacy in international investment agreements and investor-state dispute settlement
9-Jan-2018 Judicial Power Project
As the turbulence in the global economy and backlash against neoliberalism continues, opposition to the international investment regime and ISDS from the left seems destined to grow.
Lawyers ask for prompt decision on Lone Star case
9-Jan-2018 Korea Times
Lawyers for a Democratic Society sent a letter to the International Center for Settlement of Investment Disputes, demanding a speedy settlement of the dispute between the Korean government and the U.S. buyout fund Lone Star Funds.
Free trade or women’s rights?
5-Jan-2018 Strategic Review
After 30 years of neoliberal globalization, it has been increasingly acknowledged that austerity, privatization, deregulation of finance, markets and corporations, and trade and investment liberalization have had a devastating and discriminatory impact on women.
Leaked documents reveal how Shell blackmailed Nigeria in Malabu deal
2-Jan-2018 Petro Barometer
Shell used an arbitration case it filed with the International Centre for the Settlement of International Disputes to railroad the government into brokering truce between it and Malabu Oil and Gas Ltd, its estranged erstwhile partner and the original licensee.
Pakistan spends over Rs2b on legal expenses in Progas case
2-Jan-2018 Express Tribune
The government has spent over Rs2 billion to win a case in the international court over the acquisition of assets of Progas Pakistan Limited company – worth Rs2.3 billion.
UNCTAD’s 2017 high-level IIA conference: moving forward on addressing older-generation international investment agreements
22-Dec-2017 IISD
More than 300 experts, including high-level negotiators of international investment agreements and representatives from intergovernmental organizations, civil society, academia and the private sector convened in Geneva.
Government regulatory space in the shadow of BITs: The case of Tanzania’s natural resource regulatory reform
22-Dec-2017 IISD
Tanzania passed three new laws that significantly change the regulatory landscape governing natural resources and the mining sector in particular.
Lee-Chin takes on Dom Rep - Businessman seeking US$300m from country’s government for expropriating his investment
22-Dec-2017 The Gleaner
Businessman Michael Lee-Chin has served notice that he intends to submit to arbitration a claim against the government of the Dominican Republic seeking to recover more than US$300 million in damages for expropriating his investment in that country.
Investment abitration: Peru faces new ICSID claims
21-Dec-2017 Lexology
In 2017, Peru has faced a number of new investment treaty claims, with several arising in the transportation sector.
British investor claims USD 500 million from Russian coal mine
21-Dec-2017 Steel Guru
A British investment group has demanded USD 500 million from Russia and accused the country of state-sponsored corporate theft in a battle for control of a Siberian coal mine.
ISDS in numbers
14-Dec-2017 TNI
Impacts of investment arbitration against Latin America and the Carribbean.