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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.

Vodafone arbitration award: Centre to challenge telco’s Rs 22,100 crore tax case win
27-Oct-2020 Business Today
Solicitor General Tushar Mehta has advised the government that the decision of an arbitration tribunal cannot contradict the law passed by a sovereign parliament.
Another Australian miner sues another poor country, this time Barrick’s Porgera in PNG
27-Oct-2020 Michael West
Australian mining companies are increasingly using ISDS processes and are being awarded billions based on dubious calculations of potential lost profits by unaccountable international tribunals.
Jersey’s BIT with the UAE and reflections on investment treaty practice in non-sovereign autonomous regions
26-Oct-2020 Mondaq
Most recently, Jersey has joined Hong Kong as another non-sovereign entity that negotiates its own BITs. Jersey is set to sign its first BIT with the UAE later this year.
Why India should challenge the Vodafone-India BIT award
26-Oct-2020 Bar and Bench
The scope of consent to arbitration is an important issue that needs to be finally settled - not least because it could have multi-billion dollar implications for India in respect of other cases involving challenges to India’s taxation measures by foreign investors.
What next for ISDS Reform at UNCITRAL Working Group III?
23-Oct-2020 TWN
Meaningful reform aligned with sustainable development seems less likely
MEPs urge EU to be ready to dump disputed energy treaty
23-Oct-2020 EU Observer
Cross-party MEPs called on the European Commission to be prepared to withdraw from the controversial Energy Charter Treaty, if negotiations for its modernisation fail.
Expropriating democracy: on the right and legitimacy of not ratifying CETA
21-Oct-2020 EJIL: Talk!
Why retain ISDS, this neo-colonial vestige that is not supported by consistent evidence that it contributes to advancing development or the rule of law?
Stop corporations profiting from the pandemic. Stop ISDS.
20-Oct-2020 Friends of the Earth International
Our call to suspend all ISDS cases during and beyond the COVID-19 crisis.
Hungary’s OTP sues Croatia for loan conversion damages
20-Oct-2020 Reuters
OTP Bank has sued the Croatian government to recover about $34.60 million it lost during a mandatory conversion of Swiss franc-denominated loans to euro-based loans in 2015.
French-Colombian investment treaty comes into force to boost virus-battered economies
19-Oct-2020 UrduPoint
The agreement for the reciprocal promotion and protection of investments between France and Colombia has entered into force, at the time of the pandemic-related economic crisis.
The secret tribunal
19-Oct-2020 Drilled
Expert Marcos Orellana walks us through the shadowy arbitration system, the Chevron case in particular, and what it all means for global climate action.
OPL 245: Nigeria must resist Eni’s legal bullying, says group
19-Oct-2020 The Cable
The Human and Environmental Development Agenda, Re:Common, Global Witness, and Corner House, have called on the Nigerian government to stand against Eni’s legal move over the oil processing license (OPL) 245.
Orange begins legal proceedings against Iraq government
15-Oct-2020 Telecompaper
Orange Group has instituted legal proceedings against Iraq in an attempt to claw back more than USD 400 million in investments it alleges were expropriated by the country’s regulator.
Eni seeks World Bank arbitration in Nigeria oilfield dispute
14-Oct-2020 Reuters
Eni plans to argue that the country’s failure to allow it to exploit an oilfield it acquired with Royal Dutch Shell nearly a decade ago breaches their investment agreement.
Does investor protection increase foreign direct investment? A meta‐analysis
9-Oct-2020 Journal of Economic Surveys
74 studies find robust evidence that effect of international investment agreements on foreign direct investment is so small as to be considered zero.
Key international legal measures risk making the cost of green energy shift skyrocket
5-Oct-2020 IIED
A complex set of international legal measures protecting the fossil fuel industry risks significantly increasing the cost of moving to green energy and tackling climate change, a new report reveals.
Costs rise in Vattenfall lawsuit over German government’s nuclear phase-out
5-Oct-2020 Clean Energy Wire
The German government writes that around 21.7 million euros have been spent on lawyers, expert witnesses and court fees.
India to contest Vodafone arbitration judgement: Report
1-Oct-2020 Deccan Herald
The Indian government plans to contest the judgement on the Vodafone arbitration award in Hague.
Cairn seeks $1.4 bn damages from govt
30-Sep-2020 Live Mint
Cairn is seeking full restitution for losses resulting from the expropriation of its investments in India in 2014.
New bilateral treaties to keep tax disputes out of arbitration
30-Sep-2020 New Indian Express
India will try and keep its taxation laws out of the ambit of all Bilateral Investment Treaties (BITs) and comprehensive economic pacts that it negotiates.