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Europe

European Union (EU) member states have signed over 1300 investment treaties with third countries, in addition to some 200 between EU members. Non-EU European states are party to over 500 treaties. Most of these contain investor-state dispute settlement (ISDS) provisions, which enable foreign corporations to take ISDS claims against states if they deem their profits or potential investment to be affected by new laws or changes in policy.

The EU has ratified four agreements with an ISDS mechanism: the Energy Charter Treaty (ECT), to which 53 European and Central Asian countries are party, the Comprehensive Economic Trade Agreement (CETA) with Canada, and agreements with Vietnam and Singapore. Only the ECT has been fully in force. The ISDS provisions in the three others will be implemented after all member states have ratified them.

These three deals also include a revised ISDS mechanism created by the European Commission, known as the investment court system. Many critics say that this new system is largely window-dressing and does not address the core of the problem behind investor-state dispute measures.

In 2015, the European Commission asked the EU member states to terminate their intra-EU bilateral investment treaties (BITs), arguing they are incompatible with EU law, which was confirmed by the Court of Justice of the European Union in its “Achmea” decision.

As of April 2020, the number of intra-EU ISDS disputes amounted to 170, approximately 17% of all cases globally, 76 of which having been brought under the ECT.

Overall investors from European countries have initiated over 600 ISDS cases, half of which are against non-European states. European countries have been targeted in about 350 cases. Grouped together, investors from EU member states have launched the majority of total disputes (over 400).

Spain, the Czech Republic, Poland, Russia and Ukraine have been among the ten most frequent respondent states, while the Netherlands, the United Kingdom, Germany, Spain, France, Luxembourg, Italy and Switzerland have been among the ten most frequent home states of the investor.

The most well-known cases include:

• Yukos (Isle of Man) vs. Russia: US$50 billion awarded in 2014 to majority shareholders of the oil and gas company (ECT invoked).

• Eureko (Netherland) vs. Poland: case settled in 2005 for about €2 billion in favour of the investor, a large European insurance company (Netherland-Poland BIT invoked).

• Ceskoslovenska Obchodni Banka (Czech Republic) vs. Slovak Republic: €553 million awarded in 2004 to the investor, one of the largest commercial banks in the Czech Republic (Czech Republic-Slovak Republic BIT invoked).

Photo: War on Want

(April 2020)

World Bank unit starts Malampaya arbitration
Manila Standard | 27-Jun-2017
The ICSID designated the team that will hear Shell Philippines Exploration B.V.’s arbitration case against the Philippine government on Malampaya gas project’s corporate income tax issue.
energy , finance | banking | taxes , investor-state disputes | ISDS , Netherlands , Philippines
Leaked trade papers expose EU failure to uphold transparency and environment standards
Greenpeace | 26-Jun-2017
A leak of documents related to a looming trade deal with Japan (known as JEFTA) has revealed the EU’s failure to live up to improve transparency and uphold environmental standards in trade policy promises.
environment , EU , fisheries | fisherfolk , investor-state disputes | ISDS , Japan
Appeal allowed in EU state aid battle
Law Gazette | 26-Jun-2017
The High Court has granted two investors permission to appeal a decision that stayed enforcement of a dispute resolution award, in a case that centres on EU rules surrounding state aid.
agriculture | farmers | food , investor-state disputes | ISDS , Romania , Sweden
Expansion of the Energy Charter to Africa and Asia: Undoing reform in international investment law?
IISD | 23-Jun-2017
The Energy Charter Secretariat is in expansion mode, wanting to gain access to energy resources in Africa and Asia for its current—mostly developed country—members, and extending a far-reaching (and outdated) investment protection system to investments in resource-rich countries.
Africa , Asia , ECT , energy , investment | BITs , investor-state disputes | ISDS
Venezuela mines for a reversal in federal appeals court
National Law Review | 23-Jun-2017
Venezuela is taking its fight over a $1.4 billion arbitral award to the District of Columbia’s federal court of appeals.
Canada , ECT , investor-state disputes | ISDS , mining , Venezuela
Cairn tax dispute: I-T dept confiscates dividend, refund
PTI | 19-Jun-2017
The Income Tax Department has ordered coercive action against Cairn Energy of UK, including taking away over Rs 2,000 crore dividend and tax refund, to recover part of the Rs 10,247 crore retrospective tax.
energy , finance | banking | taxes , India , investor-state disputes | ISDS , UK
Belarus first time may face an ICSID claim
CIS Arbitration Forum | 14-Jun-2017
Taking into account the past Belarus practice of investor – state dispute settlement, the parties are more likely to settle Manolium Processing claim as a part of the pre-arbitration negotiations than by ICSID arbitration.
Belarus , investor-state disputes | ISDS , Russia
European free trade deal talks paused over Trudeau’s insistence on investor-state provision
Council of Canadians | 13-Jun-2017
The Norwegian government has put a pause on ’free trade’ talks given the Trudeau government’s demand for an investor-state dispute settlement (ISDS) provision in the Canada-European Free Trade Association (EFTA) agreement.
Canada , investor-state disputes | ISDS , Norway
CETA: lo llaman libre comercio y no lo es
No al TTIP | 13-Jun-2017
El Acuerdo Económico y Comercial Global de la Unión Europea con Canadá, más conocido como CETA, se nos ha presentado como un pacto entre países amigos para facilitar el libre comercio y las inversiones, pero esconde perversas intenciones entre sus mil seiscientas páginas de texto.
Canada , EU , investor-state disputes | ISDS
Foreign control and ICSID jurisdiction on Energy Charter Treaty claims of local companies: The Eskosol case
EJIL: Talk! | 13-Jun-2017
The ICSID tribunal in Eskosol in liquidazione v. Italy rejected Italy’s Rule 41.5 application to have the claim thrown out for being “manifestly without legal merit.” I offer a summary and some reflections on two interesting aspects on the tribunal’s jurisdiction.
ECT , energy , investor-state disputes | ISDS , Italy