Financial stability

Investor-state dispute settlement (ISDS) is one of the greatest threats to the re-regulation of finance. ISDS empowers the very firms that financial regulation seeks to govern. These firms can bypass host country domestic courts and directly challenge domestic policies in a parallel system of justice.

Financial and non-financial firms have increasingly used ISDS provisions in trade agreements to challenge financial regulations and emergency financial stability measures.

As of end of 2014, 7% of all ICSID cases concerned the financial sector.

Most well-known cases include:

• Investors vs. Argentina: When the country froze its utility rates and devaluated its currency in response to its 2001-2002 financial crisis, it was hit by over 40 lawsuits from investors, including Suez, Vivendi (France) and Anglian Water (UK). By January 2014, Argentina had been ordered to pay a total of US$980 million (various BITs invoked).

• Poštová Banka (Slovakia) & Istrokapital (Cyprus) vs. Greece: the Slovak bank and its Cypriot investor are currently suing Greece on account of the restructuring of the country’s sovereign debt, after having bought Greek government bonds at a knockdown value (Greece-Slovakia & Cyprus-Greece BITs invoked).

• Saluka (Netherlands) vs. Czech Republic: the Dutch investment corporation filed an ISDS dispute against the Czech government for not bailing out a private bank, in which the company had a stake, in the same way that the government bailed out banks in which the government had a major stake. The bailouts came in response to a widespread bank debt crisis. The investor was awarded US$236 million (Czech Republic-Netherlands BIT invoked).

(November 2015)

London South East | 22-Mar-2017
Ukranian authorities have now applied to the UK High Court asking to set aside the recent UNCITRAL arbitration award against Ukraine and in favour of JKX.
Interfax | 13-Mar-2017
Russia must bear responsibility for protecting Ukrainian investors in Crimea after its annexation under the Russian-Ukrainian bilateral investment treaty.
The Hindu | 10-Mar-2017
The tax dispute between the Indian government and Cairn Plc has been the subject of international arbitration from 2014.
The Hindu | 8-Mar-2017
The tax demand was challenged by Cairn Energy through an international arbitration where it also made a case against the dividend freeze
In Cyprus | 25-Feb-2017
Greek investors claim that they were discriminated against and lost millions in the bail-in of Cypriot bank deposits some four years and have launched legal action against Cyprus.
Akipress | 22-Feb-2017
The Paris Appeals Court annuled $16.5 million award for Latvian businessman Valeri Belokon and reinstated the evidence that Manas Bank employees were engaged in money laundering.
The Conversation | 20-Feb-2017
While consultancies, political donations, secondments and staff movements magnify corporate influence over government, an equally sinister trend is playing out in the world of multinational corporations.
London South East | 7-Feb-2017
JKX Oil said the tribunal found the government of Ukraine was in breach of elements of the bilateral investment treaty between the UK and Ukraine.
Defi Media | 3-Feb-2017
Le tribunal a décidé dans l’intérêt de l’équité et de l’efficacité d’admettre les sept demandes de mesures provisoires de Rawat.
Web Manager Center | 24-Jan-2017
Enterrée il y a quatre ans à l’initiative de la partie tunisienne, la recherche d’une solution amiable au litige va-t-elle être remise sur le tapis?

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