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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.

Court denies Occidental bid for assets - Ecuador
24-Aug-2006
An international arbitration court has rejected a request by Occidental Petroleum Corp. to stop Ecuador from seizing its assets in the Andean country, a government official said on Tuesday.
Azurix wins $165 million vs Argentina in latest ICSID ruling
15-Aug-2006
Former Enron Corp. (ENE) water unit Azurix Corp. has been awarded $165 million against Argentina in the latest ruling on dozens of international arbitration claims brought against the country by foreign companies. A person familiar with the situation confirmed Tuesday that both parties were informed Monday of the decision by a tribunal at the International Center for the Settlement of Investment Disputes, or the ICSID.
Seoul reveals a lack of experience in FTA negotiations
9-Aug-2006
"We are learning new things while we’re negotiating with the American representatives," said a Korean official who was part of the labor section negotiation team during the first round of the Korea-U.S. FTA talks, held in Washington last June. "The U.S. is demanding the introduction of a so-called ’public communication system,’ which was a term that we heard for the first time," the negotiator told Hankyoreh.
Canada: The Occidental Tourist - Expropriation Claim Tests BIT Efficacy
31-Jul-2006
The outcome of Occidental Petroleum’s latest dispute with Ecuador will be an important test of the effectiveness of BITs in protecting overseas investor rights in volatile political climates.
Vannessa Arbitration Update
31-Jul-2006
Vannessa Ventures Ltd. (the "Company") has an arbitral claim being heard in accordance with the rules of the International Centre for Settlement of Investment Disputes (ICSID) in Washington, D.C. where Vannessa is requesting remedies under the Bilateral Investment Treaty between Venezuela and Canada.
Zimbabwe farmers claim for land grab
25-Jul-2006 Business Day
A group of 11 dispossessed Zimbabwean farmers of Dutch origin are poised to take their case for compensation in respect of confiscated land to an international tribunal.
New legal threat over Yukos sale
12-Jul-2006 FT
The Kremlin will face yet another legal headache on Tuesday over its role in the break-up of Yukos after US attorneys began an arbitration proceeding in Spain on behalf of Spanish investors who were allegedly hurt by the Yukos affair.
Will recent nationalisations in Bolivia give rise to claims under political risk insurance policies?
15-Jun-2006 Mondaq
It may be advantageous for foreign investors to pursue a claim under a Political Risk insurance policy and allow the insurers to recover subsequently under any applicable investment treaty by way of subrogation.
Ecuador: Government gears up for Oxy fallout
26-May-2006 IPS
Showing the door to Occidental Petroleum (Oxy) and scuttling US free trade negotiations have long been agenda priorities for Ecuadorian social movements and political sectors. But following government steps that have all but made these goals a reality, the atmosphere seems more anxious than celebratory.
Ecuador to oppose arbitration claim filed by Occidental Petroleum
24-May-2006 MarketWatch
Ecuador will oppose an arbitration suit filed last week by Occidental Petroleum Corp (OXY) with the World Bank’s International Center for Investment Disputes in Washington, DC, said Ecuadorean Attorney General Jose Maria Borja.
US oil firm files arbitration claim against Ecuador for ’expropriation’
18-May-2006 ANTARA
The US-based Occidental Petroleum Company has filed an arbitration claim against Quito for canceling its exploration rights, a move that resulted in a suspension of free trade talks with Washington.
Occidental files BIT claim against Ecuador at ICSID
18-May-2006
US-based Occidental Petroleum has responded swiftly to a move by the Ecuadorian Government to kick the company out of Ecuador. The firm filed a request for arbitration with the Washington-based International Centre for Settlement of Investment Disputes (ICSID) yesterday. The company’s claim is expected to be for at least $1 Billion (US) in damages.
JPEPA: Arbitration framework readied
18-May-2006 Manila Bulletin
The Philippines and Japan are moving towards adopting arbitration procedures in settling disputes to avoid lengthy and expensive court battles in protecting investments from both sides as they finalize their proposed bilateral free trade pact.
Clashes lead to chaos in Ecuador
21-Jan-2006 BBC
Students and police have clashed again in Ecuador, as protests against a possible rise in bus fares entered a second week. The students also want the government to cancel its contract with the Occidental Petroleum Corporation and for it to refuse to join the proposed Free Trade Agreement of the Americas.
Bechtel, Bolivia resolve dispute
19-Jan-2006 San Francisco Chronicle
San Francisco-based Bechtel Corp. has dropped a $25 million dispute against the Bolivian government for canceling a water contract, after major street demonstrations forced a Bechtel-owned subsidiary to withdraw from Bolivia’s third-largest city.
OSG asks SC to reverse NAIA 3 ruling
5-Jan-2006
The Office of the Solicitor General (OSG) yesterday asked the Supreme Court to reconsider its decision allowing the government to take over Terminal 3 of the Ninoy Aquino International Airport (NAIA) only after payment of an initial P3.002 billion to the Philippine International Air Terminals Co. (PIATCO) representing the proffered value of the facilities.
Pakistan, US to hold final round of BIT talks
5-Jan-2006 Khaleej Times
A high powered US delegation is arriving here on 18 of this month to hold talks with the Pakistani authorities to finalise the BIT, in the absence of which, Washington was unprepared to sign Free Trade Agreement (FTA) with Pakistan.
Ecuador atty general expects Occidental dispute ruling in March
23-Dec-2005 Dow Jones
Ecuador’s attorney general Thursday said he expects a U.K court to rule in March on a dispute between the government and U.S. oil firm Occidental Petroleum Company (OXY).
CRS Report for Congress: Andean-US FTA negotiations
16-Dec-2005
Given that CAFTA-DR passed only by a small margin, it is unclear how much support the U.S.-Andean FTA will have.
Bilateral investment treaties dangerous traps: experts
9-Dec-2005 New Age
Experts have cautioned that bilateral investment treaties with the rich countries will ultimately lead the developing and least developed countries towards dangerous traps at the cost of their national interests.