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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.

North Macedonia charged with expropriation by Amadeus Group
5-Sep-2023 WNDB
The request for arbitration charges that North Macedonia expropriated Amadeus’ investment in a hotel and commercial center in Skopje, all violations of the North Macedonia-Albania bilateral investment treaty, and seeks a damage award of at least $110 million.
Silent coup: How corporations overthrew democracy – book review
1-Sep-2023 Counterfire
The book initially spotlights a questionable international legal system exerting influence over the policies of developing states.
S. Korea files for cancellation of int’l tribunal’s compensation order in Lone Star case
1-Sep-2023 Yonhap
The South Korean government filed an appeal seeking to cancel an international tribunal’s order to pay compensation to American private equity firm Lone Star Funds with the firm’s sell-off of the now-defunct Korea Exchange Bank.
Egregious corporate attacks on public interest policies
31-Aug-2023 Public Citizen
Many free trade and investment agreements allow multinational corporations to undermine democracy via a secret pseudo-court system known as Investor-State Dispute Settlement (ISDS).
Energy transition calls for faster investment treaty reforms
31-Aug-2023 UNCTAD
UNCTAD presents a new toolbox to make international investment agreements actively support the shift from fossil fuels to renewable energy sources.
India UK bilateral investment treaty likely to be finalised soon, to differ from 2016 model
28-Aug-2023 The Indian Express
As India and the UK inch closer towards finalising a free trade agreement, the contours of the much-debated and contentious bilateral investment treaty are likely to be finalised around the same time as the FTA.
Mining is growing rapidly – so are investor-state disputes
23-Aug-2023 Mining.com
Disputes between governments and investors involving mineral assets are growing rapidly – with 60% of all arbitrations over the last fifty years filed in the last decade, a new study found.
Lawsuits by foreign investors against Mexico
21-Aug-2023 Mexico Daily Post
According to the Ministry of Economy, from 1997 to 2022, 23 lawsuits were concluded against Mexico, where more than 3.362 million dollars were claimed as compensation, within the framework of NAFTA and various investment agreements.
Russian firm escalates dispute with Canada over seized cargo plane
21-Aug-2023 CBC
Owner of aircraft parked at Toronto’s airport invoking 1989 bilateral investment treaty.
India’s experience with investment treaty disputes and related damages
17-Aug-2023 Madhyam
The experience with investor-state dispute settlement mechanisms has been mixed, with India facing several adverse awards and financial compensation in certain high-profile cases.
Intra-EU investor-State ICSID arbitration: the German Federal Court of Justice’s new inadmissibility ruling
8-Aug-2023 Lexology
On 27 July 2023, the German Federal Court of Justice (German FCJ) declared three intra-EU investor-State ICSID arbitrations inadmissible under German arbitration law given their incompatibility with EU law.
RWE’s arbitration case against Dutch state over coal ban inadmissible under EU law
28-Jul-2023 SOMO
Dutch taxpayers have already incurred € 5.4 million in arbitration costs in RWE and Uniper cases.
Mexico set to offer Vulcan $390 million to buy land to settle spat
28-Jul-2023 Reuters
Mexico plans to offer $390 million to US construction company Vulcan Materials for land it holds in the southeast of the country, President Andres Manuel Lopez Obrador said.
Mexico hit by trade arbitration proceedings from Canadian, US firms
24-Jul-2023 Reuters
Mexico has been hit with three sets of trade arbitration proceedings in the past few days, according to the International Centre for Settlement of Investment Disputes.
Portugal announces withdrawal from Energy Charter Treaty
21-Jul-2023 Euractiv
Portugal’s Environment Minister Duarte Cordeiro annouced that the country has started withdrawing from the Energy Charter Treaty, in line with a proposal tabled by the European Commission two weeks ago.
Biden should use the Americas Partnership for Economic Prosperity to free the hemisphere from ISDS
21-Jul-2023 Common Dreams
One of the most controversial aspects of the hyperglobalization era, investor-state dispute settlement elevates multinational corporations and foreign investors to equal status with national governments.
Honduras threatens ICSID withdrawal over $11 billion ‘neo-colonial’ special economic zone claim
20-Jul-2023 Bretton Woods Project
Honduras is threatening to withdraw from the World Bank’s International Centre for Settlement of Investment Disputes over an $11 billion claim by Honduras Prospera, a US company.
Australian firm wins $109m compensation against Tanzania
20-Jul-2023 The East African
The International Centre for Settlement of Investment Disputes has ordered Tanzania to pay more than $109 million to a group of companies fronted by Australian miner Indiana Resources Ltd in compensation for the controversial 2018 expropriation of a nickel mine project in Tanzania.
Colombia: corporate claims vs human rights
19-Jul-2023 LAB
International Delegation stands with mining-affected people to urge administration of President Gustavo Petro to withdraw from corporate courts.
Korea files appeal against ruling to compensate Elliott
18-Jul-2023 The Korea Times
Korea has filed a suit asking a court in Britain to cancel an order by an international tribunal to pay nearly $108 million (136 billion won) to U.S.-based hedge fund Elliott Investment Management.