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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.


Organization in charge of Jeju Yerae Residential Resort Complex to pay over US$100 million to Malaysia’s Berjaya Group
Berjaya is to receive US$104.3 million and to withdraw the notice of intent that it submitted to seek investor-state dispute settlement arbitration for a sum of US$3.42 billion.
EU must end investment protection in the fossil sector
The Energy Charter Treaty, which dates back to the 1990s, severely restricts Europe’s ability to change regulations in the energy sector, with many EU member states facing court actions worth billions of euros, write a group of MEPs.
Chinese investments enjoy treaty protection. Beijing can drag New Delhi to tribunals
India has a Bilateral Investment Treaty with China since 2007. The treaty provides foreign investors the right to fair and equitable treatment.
Civil society groups sound alarm over COVID-19 claims in ’corporate courts’
Countries could be facing a wave of cases from transnational corporations suing governments over actions taken to respond to the Covid pandemic using a system known as investor-state dispute settlement, or ISDS. Some 630 organisations from across the world, representing hundreds of millions of people, are calling on governments in an open letter to urgently take action to shut down this threat.
Countries serious about climate change should leave the Energy Charter Treaty, says former ECT official
Interview with Yamina Saheb, former head of unit in the Energy Charter Treaty Secretariat .
Prairie Mining secures litigation funding to sue Poland
The claims had arisen out of certain measures taken by Poland, allegedly in breach of the Energy Charter Treaty and the Australia-Poland Bilateral Investment Treaty.
First annulment of investment arbitration award by Supreme Court
In a recently published decision, the Supreme Court – for the first time – partially annulled an arbitral award issued in an investment arbitration brought by Clorox España SL against Venezuela.
Why do states consent to arbitration in national investment laws?
Of the 65 states that have received investment law advice from World Bank’s FIAS, 30 subsequently included arbitration in their law.
Morocco’s new model BIT: Innovative features and policy considerations
In the face of the increasing number of claims brought by investors against host states on the basis of BITs and the exorbitant amounts awarded to investors, Morocco has undertaken a review of its model BIT using a flexible and rational approach.
Eiser Infrastructure Limited and Energia Solar Luxembourg S.à.r.l. v. Kingdom of Spain
On June 11, 2020, an ICSID ad hoc committee issued a unanimous decision to annul a €128 million award against Spain in its entirety.
Potential ISDS problems post Covid-19
The Transpacific Partnership Agreement involves investor - state dispute settlement clauses, which large companies may use ISDS to sue governments for actions they took to stop the spread of the virus.
What is Dubrovnik today?
A golf course, free-trade agreements, and the fight for the soul of a city
Open letter to governments on ISDS and COVID-19
We urge you to take immediate action to ensure that the duty of governments to regulate in the public interest is safeguarded and put beyond the scope of ISDS claims.
Is Korea caught in Lone Star’s trap?
The government is apparently baffled by Lone Star Fund’s attempts to use Korean news outlets as a means of putting itself in a dominant position in its $4.68 billion legal battle against Seoul.
Netherlands Supreme Court accepts Russia’s appeal of $57 billion verdict in favor of ex-Yukos shareholders
The Supreme Court of the Netherlands has agreed to consider Russia’s appeal against a lower court ruling, which awarded multi-billion-dollar compensation to former shareholders of the defunct Russian oil giant, Yukos.
Foreign investment, knowledge and international arbitration: inside a research trip
International investment law and investor dispute arbitration too often fail to notice the concerns of local actors. Governance of these international mechanisms needs to take a more holistic, development-based view of the issues.
NextEra wins millionaire renewables lawsuit against Spain
The ICSID has lifted the suspension on the execution of the €290 million award NextEra obtained a year ago.
Ray of hope for Reko Diq penalty being nixed
Pakistan’s chances of having its $6 billion penalty in the Reko Diq case annulled have received a boost with a committee of the International Centre for Settlement of Investment Disputes (ICSID).
Preparing for the COVID aftermath
Arbitration cases due to COVID emergency measures would exacerbate the challenges that public budgets are already facing due to the need for stimulus measures and the difficulty in collecting government revenue.
Africa should resist acceding to the Energy Charter Treaty
Joining the Energy Charter Treaty could cost developing countries money that is urgently needed to fight Covid-19 and a loaming economic crisis. The Energy Charter Treaty has become increasingly controversial.