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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.

"Investment" narrowly construed under NAFTA in Apotex v. US
4-Sep-2013 Mondaq
In a recent NAFTA Investor-State claim brought against the United States by Apotex Inc., Canada’s largest producer of generic drugs, the Tribunal upheld the US’ preliminary objections to jurisdiction on the grounds that the company’s efforts to win approval for generic drugs in the US market did not make it an "investor" under NAFTA Chapter Eleven.
Growth in global disputes brings big paychecks for law firms
27-Aug-2013 NY Times
Debt woes, broken contracts and soured business deals may cost global investors billions in losses and create seemingly never-ending headaches for policy makers. But there is a set of specialists profiting from such geopolitical problems: arbitration lawyers.
Trans-Pacific Partnership talks hit roadblock over anti-smoking policies
25-Aug-2013
Fast-moving trade talks aimed at reaching an ambitious Trans-Pacific Partnership trade deal have hit a major snag over anti-smoking policies, as divisions emerged over a proposal critics say would expose governments to lawsuits from tobacco companies.
FTAs actually restrict free trade
3-Aug-2013
We are told that when trade is free, there will be more trade and nations will prosper. To achieve even freer trade the nations of the world must enter into free trade agreements.
Nurul Izzah: Don’t bow down to pressure on TPP
31-Jul-2013
Malaysia’s Parti Keadilan Rakyat VP Nurul Izzah Anwar has accused the Ministry of International Trade and Industry of bowing down to pressure when it agreed to clauses on investor-state dispute settlement in negotiations for the Trans Pacific Partnership (TPP) agreement.
Karkey serves Rs33b damage notice on Pakistan; Approaches ICSID against water and power ministry
20-Jul-2013
The Turkish power firm Karkey Karadeniz Elektrik Uretim (KKEU) has approached the Washington based International Centre for Settlement of Investment Disputes (ICSID) against Pakistan’s water and power ministry and also served a Rs33billion damage notice on the ministry, sources said on Wednesday.
Lilly ramps up NAFTA fight over loss of patents
17-Jul-2013 Globe and Mail
US pharmaceutical giant Eli Lilly and Co. has escalated a challenge it launched last year against Canada’s patent rules under the North American free-trade agreement, and is now demanding $500-million in compensation after the company lost its Canadian patents on two drugs.
Treaty disputes roiled by bias charges
10-Jul-2013
Concerns about objectivity and accountability of investment dispute arbitrators have prompted calls for tougher ethical guidelines as caseloads have exploded.
TDM call for papers: "Reform of investor-state dispute settlement: In search of a roadmap"
4-Jul-2013 TDM
Transnational Dispute Management are pleased to announce a forthcoming special issue: "Reform of Investor-State Dispute Settlement: In Search of A Roadmap."
Japan Tobacco said it sued Thailand over health warnings
3-Jul-2013 Bloomberg
Japan Tobacco Inc., Asia’s biggest listed cigarette maker, sued the government of Thailand over a plan to increase the size of health warnings on cigarette packages, claiming the move is unconstitutional.
ICSID and Latin America: Criticisms, withdrawals and regional alternatives
25-Jun-2013
Latin American states are the only ones in the world that have decided to withdraw from the ICSID Convention. It is also the only region in the world considering the necessity to find an alternative to ICSID mechanism.
PMI awaits jurisdiction ruling in Uruguay bilateral investment treaty litigation
19-Jun-2013 Tobacco Reporter
Philip Morris International expects a decision to be made this month or next on a challenge by Uruguay as to whether an international tribunal set to hear bilateral investment treaty complaints has jurisdiction over the matter.
Turkish firm Karkey files $700m claim on Pakistan
18-Jun-2013 The News
A Turkish power generation company has filed a case against the Pakistan government at ICSID for compensation of losses worth 700 million dollars
A transatlantic corporate bill of rights
12-Jun-2013 A transatlantic corporate bill of rights
Leaked draft versions of the EU negotiating mandate for a far-reaching free trade agreement with the US reveal the European Commission’s plans to enshrine more powers for corporations in the deal. The proposal follows a persistent campaign by industry lobby groups and law firms to empower large companies to challenge regulations both at home and abroad if they affect their profits.
Investor privileges in EU-US trade deal threaten public interest and democracy
11-Jun-2013 TNI
This new briefing from CEO and TNI analyses leaked proposals for investor-state dispute settlement under the proposed EU-US FTA
Argentine court revokes US$19 bln embargo on Chevron
6-Jun-2013 Bernama
Argentina’s Supreme Court revoked a US$19 billion embargo on the assets and future income of Chevron Corp.’s Argentina subsidiary, giving the US oil giant a victory in a decades-old battle with indigenous groups in Ecuador.
Experts warn Myanmar about risks with investment treaties
1-Jun-2013 Eleven Myanmar
International experts have warned that the use of investment treaty ‘Investor-State Dispute Settlement (ISDS)’ for attracting foreign investments into Myanmar is risky as it grants the investors the right to initiate dispute settlement proceedings against the government under international laws.
Venezuela claims ICSID arbitration victory over Panama’s OPIC Karimun Oil Company
30-May-2013 Latin American Herald Tribune
Venezuela reported a triumph at the World Bank’s International Center for the Settlement of Investment Disputes in a case brought by Panama’s OPIC Karimun Corporation on compensation for losses it sustained when Venezuela nationalized oil fields in 2007.
South American Silver lands international arbitration funding agreement
28-May-2013 Mining Weekly
Vancouver-based South American Silver (SAS), which early in May filed for arbitration against the Bolivian government over the cancellation of mineral tenements in 2012, has entered into a privileged arbitration funding agreement with an international investment fund specialising in such proceedings.
Coup d’etat to trade seen in billionaire toxic lead fight
28-May-2013 Bloomberg
Most of La Oroya’s children suffer elevated lead levels, according to the Peruvian government. Parents say some have symptoms — consistent with lead poisoning — that include anemia, convulsions, stunted growth, mental retardation.