Most Bilateral Investment Treaties (BITs) are not just used by investors to inform their investment decisions, but are increasingly becoming tools used to sue States in a foreign or international court.
The heavily criticized legal mechanism, known as ISDS, is an important tool for European companies to pressurize developing countries. This year Uganda joins the rank of developing nations asking themselves: “Why have we ever signed this?”
Despite debates about crisis in investment treaty arbitration, most emerging market economies are concluding BITs that provide for ISDS and emerging market multinational companies appear to welcome ISDS.
India has a faced a number of claims from foreign investors over the years under the BIT regime. It is presently engaged in over 20 investor-State disputes, with a number of them revolving around retrospective tax claims.