Gulf trade deal could ‘lock in’ more rights for fossil fuel industry, campaigners warn
Global Justice Now | 27 October 2025
Gulf trade deal could ‘lock in’ more rights for fossil fuel industry, campaigners warn
UK government reported to be demanding corporate courts as a red line in deal with six Gulf countries
The British government has been criticised for demanding investor-state dispute settlement (ISDS) is included in its trade deal with the Gulf Cooperation Council, as ministers prepare to visit the Gulf next week for talks aimed at finalising the deal.
The ISDS mechanism allows foreign multinationals to sue governments in secretive ‘corporate courts’ when they perceive their interests have been damaged.
Increasingly, ISDS has been used to challenge climate action, often for millions if not billions of pounds. Fossil fuel firms have been awarded over $80 billion under ISDS since 1998.(1) Most recently, the British government was challenged this summer using ISDS, after courts halted a proposed coal mine in Cumbria.(2)
The British government has been trying to get India to agree to include ISDS in a recent investment deal, but the Indian government appears to have scuppered efforts. Now Politico reports that two out of six GCC countries are believed to be holding out over putting ISDS in the UK deal.(3)
ENDS
Nick Dearden, director of Global Justice Now said:
Only months after the UK has been challenged under ISDS because of the shelving of the Cumbria coal mine, it is trying to tie its own hands in new trade deals with these climate-wrecking, democracy-defying corporate courts. This will simply lock in more rights for the fossil fuel industry.
Even more incredible, this isn’t something which holds any interest for most businesses. More than anything the government seems to be virtue signalling to the most reckless financial and corporate interests – and risking public money in the process.”
Tom Wills, Director of the Trade Justice Movement, said:
The UK government says it wants to attract more investment, but studies show that ISDS doesn’t even help with that. Deepening the UK’s involvement in the ISDS system is exactly the opposite of what the government should be doing. Instead, the government should be seeking to terminate or renegotiate these treaties so they are fit for the modern age.”
Notes
1 Global ISDS tracker database, https://www.globalisdstracker.org/database/
2. Investors in quashed coal mine sue government, BBC News, 14 August 2025, https://www.bbc.co.uk/news/articles/c9391205znwo
3. Politico Morning Trade, 23 October 2025
