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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.

AFTINET on ISDS
13-Aug-2014 AFTINET
Australia Fair Trade and Invesment Network’s Convener, Dr Patricia Ranald, gave evidence to the Senate Committee for Foreign Affairs Defense & Trade on the 6th August 2014 about the dangers of investor-state dispute settlement (ISDS) in trade agreements.
Bear Creek announces its intent to commence an arbitration against Peru - Santa Ana dispute
12-Aug-2014 PR Newswire
Canadian company Bear Creek Mining announces that it intends to commence an arbitration proceeding against the government of Peru under the Canada-Peru FTA.
Two-third of voters in Tory marginals want NHS exempt from US trade pact
8-Aug-2014 The Guardian
More than two-thirds of voters in 13 battleground constituencies want to see the NHS safeguarded from a new trade deal that critics say threatens to make the privatisation of UK health services permanent.
Why developing host countries sign increasingly strict investment agreements
5-Aug-2014 Vox.eu
Despite the failure of the OECD’s MAI negotiations and the lack of agreement to put investment on the WTO’s negotiating agenda, the major source countries of FDI will eventually get close to their objective of a comprehensive web of investment agreements with increasingly stricter investment provisions with those developing countries that compete with each other as hosts of their FDI.
US-Africa Summit - Are we up for a new deal?
4-Aug-2014 ECDPM
The US Trade Representative Michael Froman argues for comprehensive trade and investment strategy – read possibly in the future, negotiate reciprocal trade agreements, à la EU-Africa Economic Partnership Agreements (EPAs) but with more binding investment clauses to protect the interests of US businessmen.
Geist: How a 20-year-old patent application could upend Canada’s biggest trade deal
4-Aug-2014 The Star
From a Canadian perspective, the Eli Lilly case has provided a powerful reminder that the risks associated with ISDS may outweigh the benefits with legal cases that can take decades to resolve.
The UK-Colombia Bilateral Investment Treaty
1-Aug-2014 ABColombia
The UK-Colombia Bilateral Investment Treaty that was ratified by the House of Commons on 10 July 2014 poses grave risks to the achievement of human rights and the successful implementation of agreements currently being made in the peace dialogues between the FARC guerrilla and the Colombian Government in Havana.
The era of mega-arbitration: International court rules against Russia in $50 billion decision
30-Jul-2014 Madhyam
On 28 July 2014, an international arbitration tribunal announced that Russia must pay $50.02 billion in damages to former shareholders of the now defunct oil giant, Yukos Oil Company. Analysis by Kavaljit Singh.
Germany insists it hasn’t scuttled CETA: report
29-Jul-2014 iPolitics
The German ministry of the economy has clarified its position on the Canada-EU trade agreement (CETA), saying it will “meticulously” examine the agreement as soon as it’s on the table, Agence France Presse reported Monday.
Germany to reject EU-Canada trade deal - Sueddeutsche newspaper
26-Jul-2014 Reuters
Germany is to reject a multi-billion free trade deal between the European Union and Canada which is widely seen as a template for a bigger agreement with the United States, a leading German paper reported on Saturday.
Commission swamped by 150,000 replies to TTIP consultation
24-Jul-2014 EurActiv
About 150,000 people have responded to the European Commission’s online consultation on the controversial investor-state dispute settlement (ISDS) clause in the Transatlantic Trade and Investment Partnership (TTIP).
CETA ‘should be initialed by September 25′: EU Trade Commissioner
23-Jul-2014 iPolitics
The end of the Canada-EU trade agreement (CETA) technical negotiations are “in sight” and the deal should be initialed in time for a late September bilateral summit in Ottawa, EU Trade Commissioner Karel De Gucht said Tuesday.
TDM Special Issue on "Arbitration in the Middle East - Expectations and Challenges for the Future"
22-Jul-2014 TDM Special Issue on "Arbitration in the Middle East - Expectations and Challenges for the Future"
The volume of international business either in the Middle East or with a Middle Eastern element is increasing and many of the contracts being used provide for arbitration. While arbitration ("tahkim" in Arabic) has long-standing religious and cultural roots in the Middle East, there are a number of differences and tensions between the Western perception of arbitration and certain Islamic legal principles.
121 scholars speak out against planned investor-state arbitration provisions in the US-EU TTIP, modeled on the Canada-EU CETA
16-Jul-2014
A group of 121 academic experts has spoken out against planned provisions on investor-state arbitration in the Transatlantic Trade and Investment Partnership.
Supporters of investment arbitration launch EU think tank
11-Jul-2014 Global Arbitration Review
Corporate counsel and practitioners in Europe have formed a non-profit association to promote the benefits of investor-state arbitration and influence EU policy on investment protection.
Juncker states his opposition to fracking
10-Jul-2014 ENDS Europe
Asked about the trade deal the Commission is currently negotiating with the US, which campaigners fear will allow private companies to challenge the EU’s environmental rules, Mr Juncker stressed that the normal, publicly accountable, court system should be used instead of private courts or arbitration panels.
TTIP: debunking the business propaganda over investor rights
3-Jul-2014 CEO
The EU Commission’s plan to enshrine sweeping rights for foreign investors in the EU-US trade deal continues to draw heavy criticism. In response, industry lobby groups, law firms, and arbitrators have launched a tooth and nail defence of the business power grab. See through their propaganda with Corporate Europe Observatory’s guide to investment arbitration.
Australia wins first battle in plain packaging trade dispute
3-Jul-2014 Sydney Morning Herald
The Permanent Court of Arbitration has ordered that Australia will be allowed to challenge Philip Morris Asia’s right to contest Australia’s plain packaging laws, on the grounds that the company only bought shares in its Australian arm so that it could launch the case.
Newmont files for arbitration against Indonesia government on ore-export ban
3-Jul-2014 Dow Jones Newswires
Newmont Mining Corp. said Tuesday it is filing for international arbitration against the Indonesian government for a mineral-export ban.
Commission closes TTIP consultation — But is it listening?
1-Jul-2014 ETUC
Bernadette Ségol the General Secretary of the European Trade Union Confederation says trade unionists are “particularly concerned at statements from DG Trade implying that the consultation is about a reform of the ISDS system and is not open to a decisive rejection.”