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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.


Pakistan-US differences over BIT persists
Pakistan has asked the United States to sign the proposed Bilateral Investment Treaty (BIT) by dropping its demand that in case of an arbitration only the Washington based International Centre for Settlement of Disputes (ICSID) should be approached for a decision.
United States tears up free-trade rule book
The United States, such a paragon and champion of free trade when it comes to exporting its own products and services, evidently considers itself free unilaterally to ignore the rules when the umpire comes down against it.
Tribunal OKs treaty-shopping for better arbitration options in Gas Natural case
Another international arbitral tribunal has weighed in on the question as to whether “Most-Favored Nation” treatment offers foreign investors access to more favorable dispute resolution options found in other treaties.
CAFTA’s debt trap
Criticism of the Central American Free Trade Agreement (CAFTA) currently being considered by the U.S. Congress has focused heavily on concerns that the treaty would devastate Central American farmers who would be forced to compete with heavily subsidized U.S. agribusiness.
Suez strikes back in Bolivia
Bolivia faces an impending lawsuit for cancelling the water contract with Aguas del Illimani, the private consortium controlled by majority shareholder Suez. Thanks to a bilateral investment treaty signed between France and Bolivia, Suez has the right to sue the Bolivian government for breach of contract.
Govt, Bechtel ink Dabhol deal
The Indian government and Bechtel have reached an agreement on ‘‘all issues’’ related to the Dabhol project. The settlement agreement between the two was signed on Tuesday thereby completing the entire settlement process with both stakeholders - GE and Bechtel - in the Dabhol power venture.
Dabhol deal on track, Bechtel says it’s willing to settle
The Dabhol settlement process is almost complete with US-based Bechtel Corp finally informing the Indian side that it’s willing to settle and not proceed with international arbitration.
Land grab to go to arbitration
About 1 500 commercial farmers who have had their land forcibly and sometimes violently seized by Robert Mugabe’s government have taken their case to international arbitration.
Argentina to seek annulment of ICSID ruling in favour of CMS Energy
The Argentine government said it will try to annul a ruling by the World Bank’s International Centre for Settlement of Investment Disputes (ICSID) in favour of US company CMS Energy Corp.
Steps needed to avoid legal disputes with US
The Thai government must become more efficient and enact more ironclad laws in order to avoid unnecessary legal disputes with US investors once the Thailand-US free trade area (FTA) agreement takes effect, says a local researcher.
Spectre of lawsuit losses hangs over Bucharest
Romania’s past treatment of foreign investors may soon come back to haunt its new government and an economic plan agreed with Brussels ahead of membership of the European Union. A World Bank arbitration panel, the Icsid, is expected to rule in coming weeks on a lawsuit seeking $350m (€270m, £180m) from the state brought by Noble Ventures, an American investment group.
Scotiabank files $600M US claim against Argentina
Scotiabank has filed a $600 million US compensation claim against Argentina, claiming that "discriminatory" actions taken by Argentine authorities led to the total loss of its investment in its Scotiabank Quilmes subsidiary in 2002.
Italy claims SA in breach of treaty
The minerals and energy department is engaged in talks with Italian companies operating in SA over possible breaches of the SA-Italy bilateral investment treaty in the implementation of the Mineral and Petroleum Resources Development Act.
Corporate conquest, global geopolitics: Intellectual property rights and bilateral investment treaties
Examines how bilateral investment treaties and free trade agreements which contain specific investment provisions reflect geopolitical concerns and redefine rights and privileges for transnational corporations, including with respect to commercial control over biodiversity through intellectual property rights.
NAFTA Chapter 11 investor-state cases: Lessons for the CAFTA
A new study by Public Citizen’s Global Trade Watch analyzes 42 NAFTA investor-state challenges and illustrates how the proposed CAFTA would extend the threat.
Germany’s Fraport flexes muscle
Fraport AG of Germany has decided to flex its diplomatic muscle in pressing for immediate compensation from the Philippine government for their investment in the Ninoy Aquino International Airport Passenger Terminal 3 (NAIA-3) project, under the 1997 Philippine-German bilateral investment treaty.
Investment: NAFTA illegal?
On January 24, the Council of Canadians and the Canadian Union of Postal Workers (CUPW) launched a constitutional challenge against NAFTA’s Chapter 11 rules before the Ontario Superior Court of Justice. This is the first time that a court will consider the constitutionality of international trade rules.
FTA: Facing The Apocalypse?
The graffiti on the walls in Quito ask if the Free Trade Agreement (FTA) that the US is pushing on Colombia, Peru and Ecuador means that our days are numbered.
The secret trade courts - NYT editorial
In Ecuador, residents of the country’s eastern rainforest are suing Chevron Texaco. They say that the methods Texaco used to drill for oil in the 1970’s and 1980’s caused billions of dollars in environmental damage and health problems that continue today.
CMS vs Argentina
Decision of ICSID Tribunal (July 17, 2003) in regard to objections to jurisdiction in CMS Gas Transmission Company vs The Republic of Argentina. CMS bases its claim against Argentina on a 1991 Argentina-US Bilateral Investment Treaty (BIT).