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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-Canada (CETA) - Revised draft decisions on the appellate tribunal, the code of conduct and the rules for mediation for the implementation of the Investment Court System (EU proposal, July 2018)
10-Aug-2018
Secrecy shrouds cost to Australian taxpayer in controversial trade dispute
8-Aug-2018 The Guardian
US energy company is seeking $350m in compensation in so-called ISDS case over gas turbines in Pilbara.
Conflicts between Latin American countries and transnational corporations: The challenges of the region in the face of asymmetrical investment treaties
8-Aug-2018 IISD
Facing multimillion dollar claims, many Latin American states have become critical of investment arbitration. A group of researchers building a database of legal and policy tools aims to change this.
Expropriation without compensation? Ask the British.
4-Aug-2018 Africa is a country
Zimbabwe is still seeking to have annulled two Awards issued by a tribunal of the ICSID. The disputes concern the government’s expropriation of timber plantations which were first established by Rhodes’ BSAC.
One hundred years of expropriation without compensation
4-Aug-2018 Expropriate
On 29 July 1918, the British judiciary proffered the Empire’s most expressly and egregiously racist justification for the land dispossession of indigenous peoples. Today, an ICSID tribunal continues that mission. No matter which way Zimbabwean’s turn at the polls, they’re still paying for their invasion and occupation by Cecil Rhodes’ British South Africa company...
Asia’s evolving ‘free’ trade deal may not benefit workers
3-Aug-2018 Manila Times
Labor unions and workers’ rights advocates fear that the secretive RCEP agreement will further erode workers’ rights in the Asian region, while strengthening the hands of investors who may be able to sue governments for changing laws such as setting minimum wages, that would erode their profitability.
Swiss foreign investor claims it suffered US$264 million in damages caused by South Korean government
2-Aug-2018 Hankyoreh
This is the fourth ISDS dispute this year in which the South Korean government is embroiled.
India’s model bilateral investment treaty: Are we too risk averse?
1-Aug-2018 Brookings Institution
India’s Model BIT is "pro-state with limited rights to foreign investors" according to the US thinktank Brookings
Dar faces legal suit at international tribunals over tax, investment policies
30-Jul-2018 East African
Civil society organisations are pushing for a review of the BIT between Tanzania and The Netherlands which they say does not serve the best interests of Tanzania.
Community groups say no to the TPP-11 at Senate inquiry
30-Jul-2018 AFTINET
“AFTINET will present evidence today to a Senate inquiry that the TPP-11 increases corporate rights at the expense of people’s rights and the environment and should not be implemented,” AFTINET Convener Dr Patricia Ranald said today.
Oral Statement: Indonesia for Global Justice (IGJ) for the 23rd round RCEP negotiation, Bangkok, Thailand, July 23rd, 2018
25-Jul-2018 IGJ
Redlines for investment provision in RCEP negotiation
RCEP agreement puts future of Thai people at risk
24-Jul-2018 Bangkok Post
The Thai government is about to enter a trade deal that could seriously harm the reform agenda and deprive communities of the ability to make decisions for fear of violating investors’ rights.
Schindler seeks $264 mn ISD suit vs Korean gov over Hyundai Elevator
20-Jul-2018 Pulse
Schindler filed a notice of intent for arbitration on July 11. Under the ISD procedure, if the issue is not resolved through settlement in 90 days, the investor can take the case to the international tribunal.
US trade deals mean justice for some, not justice for all
18-Jul-2018 AFL-CIO
Those with the means to become international wheeler-dealers can access ISDS. The rest of us have to rely on public courts—the same ones that investors say are “inadequate” to handle their needs. That’s not fair, and that’s not right.
Rwanda faces suit over cancelled mining concession
16-Jul-2018 The East African
Rwanda faces an international arbitration suit filed by two American firms contesting the cancellation of their mining concession.
Investor vs state interests debate heats up
16-Jul-2018 Bangkok Post
Ahead of the 23rd round of negotiations for the Regional Comprehensive Economic Partnership there has been growing concern over its investment chapters that will let foreign investors’ benefits overrride public interests.
Elliott starts ISD suit against Korea, claiming $770m in damage
13-Jul-2018 Korea Herald
US-based hedge fund Elliott Associates has officially filed for an investor-state dispute settlement against the South Korean government seeking $770 million in compensation for the merger between two Samsung Group affiliates.
Turkish government taken to international tribunal
12-Jul-2018 The Guardian
Recep Tayyip Erdoğan’s regime accused of illegally seizing company assets and breaching investment treaties involving Britain and other EU states.
Signature of economic and strategic partnership agreements expected at 25th EU-Japan summit
6-Jul-2018 Agence Europe
At their 25th bilateral summit, in Brussels on 11 July 2018, the EU and Japan will sign their strategic partnership agreement.
US fund claims $175 million from South Korea over Samsung units’ 2015 merger
3-Jul-2018 Business Insider
New York-based hedge fund Mason Capital Management has filed a legal claim seeking at least $175 million from the South Korean government as compensation for damages it says it sustained from a 2015 merger of two Samsung Group affiliates.