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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.

EU plans to reform Energy Charter Treaty falling short, activists say
30-Apr-2020 Euractiv
An updated European Commission proposal to reform the Energy Charter Treaty is falling short of what’s needed to reinstate governments’ “right to regulate” in areas like climate change, activists say.
UN tribunal rules against Canada’s Edgewater in legal battle with Spain
27-Apr-2020 Mining.com
An arbitration tribunal ruled against Canadian company Edgewater Exploration in its long-standing legal battle with Spain related to the Corcoesto gold project in the northwestern region of Galicia.
Eni and Naturgy’s Damietta gas plant deal with Egypt falls through
24-Apr-2020 Nasdaq
In the meantime, Naturgy said it would go back to pursuing a legal claim to $2 billion in compensation its joint venture with ENI was awarded in the case by the World Bank’s ICSID in 2018.
Corporations prepare to sue over action to save lives as pandemic reveals trade flaws
23-Apr-2020 The Conversation
Global companies are positioning themselves to use little-known rules in trade agreements to claim millions of dollars in compensation for restrictions imposed during the pandemic.
Despite controversy, the Energy Charter Treaty is silently being pushed into Africa
21-Apr-2020 Euractiv
Joining the Energy Charter Treaty could cost developing countries money that is urgently needed to fight the COVID-19 pandemic and economic crisis.
Pandemic profiteers: how foreign investors could make billions from crisis measures
20-Apr-2020 TNI
Governments’ emergency actions in the wake of COVID-19 could prompt a wave of arbitration lawsuits for billions of dollars by multinational corporations and investment lawyers.
Peru warned of potential ICSID claims over covid-19 measures
17-Apr-2020 Latin Lawyer
Peruvian officials have warned that a proposed emergency measure suspending the collection of toll fees on the country’s road network in response to the outbreak of covid-19 could result in multiple ICSID claims.
Protecting against investor–state claims amidst COVID-19: A call to action for governments
16-Apr-2020 IISD
Governments are facing an imminent threat of investor–state arbitration as they take difficult decisions to support public health systems in a time of severe economic stress.
Silent expansion
15-Apr-2020 CEO
Many countries, particularly in the global south, are in the process of joining the Energy Charter Treaty despite the sweeping powers it grants to foreign investors.
Brazil India investment cooperation and facilitation treaty (2020)
10-Apr-2020 Modern Diplomacy
This is Brazil’s 10th and India’s 4th bilateral investment agreement since both nations had adopted their Model Bilateral Investment Treaty.
Investment treaty claims in pandemic times: Potential claims and defenses
9-Apr-2020 Kluwer Arbitration Blog
States around the world have taken a variety of measures seeking to stem the spread of COVID-19. It is likely that some foreign investors may seek relief and/or compensation for any losses resulting from State measures.
We need to talk about valuation in ISDS
2-Apr-2020 Verfassungsblog
Investors are receiving monetary damages that they would not be entitled to outside of ISDS, on the basis of an unjustified and highly reductive understanding of value.
Epidemic sovereignty? Contesting investment treaty claims arising from coronavirus measures
2-Apr-2020 EJIL:Talk!
Allegedly arbitrary or disproportionate measures, albeit in the public interest, provide regular grist for the mill of investment treaty arbitration.
Covid-19: Why India doesn’t need to worry about investor-State dispute settlement claims
2-Apr-2020 Hindustan Times
In order to halt the spread of the coronavirus pandemic (Covid-19) and to boost the public health care system and preparedness, India has taken several regulatory steps.
Miner South32 files request for arbitration in Colombia royalty dispute
1-Apr-2020 Reuters
Mining company South32 has filed a request for arbitration at the World Bank over a dispute with Colombia concerning royalty payments from its majority-owned Cerro Matoso ferronickel mine:
Could COVID-19 emergency measures give rise to investment claims? First reflections from Italy
31-Mar-2020 GAR
Emergency measures to prevent the spread of the coronavirus and protect the economy could lead to claims under bilateral investment treaties.
Guatemalan water protectors persist, despite mining company threats
27-Mar-2020 Inequality.org
The hard work of protecting water and land from the long-term harms associated with gold and silver mining takes place daily on the frontlines of tenacious struggles throughout Latin America and around the world.
Hungary held liable for expropriating the investment of a British investor and ordered to pay EUR 7 million in compensation for damages
27-Mar-2020 IISD
Magyar and Inicia filed for arbitration against Hungary claiming expropriation of their leasehold rights to the land, following an agricultural sector reform to promote family farms over farming companies.
Risky business: Uniper’s potential investor-state dispute against the Dutch coal ban
18-Mar-2020 EJIL: Talk!
While policies aiming to phase out coal are necessary to tackle climate change, they may give rise to legal claims from companies whose investments are adversely affected by the low-carbon energy transition.
2019 annual results
16-Mar-2020 Gabriel Resources
Gabriel has provided notice to Romania of a dispute with regard to Romania’s application to UNESCO in relation to Roşia Montană and has reserved its right to commence a further arbitration.