Key cases

Energy

• Vattenfall (Sweden) vs. Germany

In 2007 the Swedish energy corporation was granted a provisional permit to build a coal-fired power plant near the city of Hamburg. In an effort to protect the Elbe river from the waste waters dumped from the plant, environmental restrictions were added before the final approval of its construction. The investor initiated a dispute, arguing it would make the project unviable. The case was ultimately settled in 2011, with the city of Hamburg agreeing to the lowering of environmental standards (ECT invoked).
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• Yukos (Isle of Man) vs. Russia

Yukos was a Russian oil and gas company. It was acquired from the Russian government during the controversial “loans for shares” auctions of the mid 1990s, whereby some of the largest state industrial assets were leased (in effect privatized) through auctions for money lent by commercial banks to the government. The auctions were rigged and lacked competition, and effectively became a form of selling for a very low price. In 2003, Yukos CEO was arrested on charges of fraud and tax evasion and the following year Yukos’ assets were frozen or confiscated. In 2007 the Yukos’ former shareholders filed a claim for over $100 billion, seeking compensation for their expropriation. The dispute resulted in 2014 in the arbitrators awarding the majority shareholders over US$50 billion in damages. In 2016, a Dutch court overturned the ruling, since Russia had never ratified the Energy Charter Treaty that had been invoked.
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Environment

• Bilcon (US) vs. Canada

The US industry challenged in 2008 Canadian environmental requirements affecting their plans to open a basalt quarry and a marine terminal in Nova Scotia. The investors planned to blast, extract and ship out large quantities of basalt from the proposed 152-hectare project, located in a key habitat for several endangered species, including one of the world’s most endangered large whale species. A government-convened expert review panel concluded that the project would threaten the local communities. On these recommendations, the government of Canada rejected the project. In 2015 the ISDS tribunal decided that the government’s decision hindered the investors’ expectations. Bilcon won – damages still pending (NAFTA invoked).
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• Pac Rim Cayman LLC (Canada, U.S.-based subsidiary) vs. El Salvador

In 2008, El Salvador denied a mining permit to Pac Rim due to environmental concerns. Local communities were also opposed to the mining project. As the smallest and most densely populated country in Latin America, with already stressed water supplies, Salvadorans were unwilling to face the risks that industrial metal mining represented. In 2012, an ISDS tribunal allowed the mining corporation to pursue its multi-million dollar claim at the International Centre for Settlement of Investment Disputes (ICSID). Case is still pending (CAFTA invoked).
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Financial stability

• Investors vs. Argentina

When the country froze its utility rates in response to its 2001-2002 financial crisis, it was hit by over 40 lawsuits from investors, including Suez & Vivendi (France), Sociedad General de Aguas de Barcelona S.A (Spain) and Anglian Water (UK). The ISDS tribunal concluded that Argentina had breached the investors’ right to fair and equitable treatment. By 2014, the country had been ordered to pay a total of US$980 million (various BITs invoked).
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Food

• Cargill (US) vs. Mexico

In 2009 US$90.7 million was awarded to the agribusiness producer of high fructose corn syrup (HFCS) – a derived sweetener linked to obesity. The investor successfully challenged a government tax levied on beverages sweetened with HFCS. The tax helped safeguard the Mexican cane sugar industry, consisting of hundreds of thousands of jobs, from the post-NAFTA influx of US-subsidized HFCS that threatened those jobs. Mexico also argued that the tax was legitimate as a counter to the US refusal to open its market to Mexican cane sugar as stipulated by NAFTA. The ISDS tribunal ruled that the tax was a violation of Cargill’s right to fair and equitable treatment (NAFTA invoked).
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Health

• Eli Lilly (US) vs. Canada

In 2013 the pharmaceutical corporation challenged Canada’s patent standards after Canadian courts invalidated the company’s supplementary patents for Strattera and Zyprexa, claiming the drugs were not sufficiently innovative. The courts ruled that Eli Lilly had failed to demonstrate or soundly predict that the drugs would provide the benefits that the company promised when applying for the patents’ monopoly protection rights. The resulting invalidations of the patents paved the way for Canadian drug producers to produce less expensive, generic versions of the drugs. Eli Lilly’s notice argued that Canada’s entire legal basis for determining a patent’s validity – that a pharmaceutical corporation should be required to verify its promises of a drug’s utility in order to obtain a patent – is “arbitrary, unfair, unjust, and discriminatory.” The investor is claiming C$500 million. Case pending (NAFTA invoked).
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• Ethyl (US) vs. Canada

Ethyl, a US chemical company, launched an ISDS dispute over the Canadian ban of MMT, a toxic gasoline additive containing a known human neurotoxin. Canadian legislators banned MMT over public health and environmental concerns. The additive was already banned by the US Environmental Protection Agency. The case was settled in 1998 for US$13 million paid to Ethyl. The settlement also required Canada to lift the ban and post advertising saying MMT was safe (NAFTA invoked).
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Labour

• Véolia (France) vs. Egypt

In 2012, the multinational utility corporation launched a dispute against Egypt, demanding US$110 million following changes to Egypt’s labour laws leading to an increase in minimum wage. Case pending (Egypt-France BIT invoked).
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Public services

• Eureko (Netherland) vs. Poland

In 1999 the Polish Government published an invitation to sell 30% of the shares capital of the state-owned insurance company PZU. Eureko and Big Bank Gdanski S.A. were selected as the buyers. Eureko then planned to increase its share holdings using the initial public offering from 30% to 51%. The dispute emerged following Poland’s refusal to complete PZU’s privatization – which would have allowed Eureko to obtain a majority shareholder in the company. The claimant contended that Poland backtracked on their earlier commitments. Poland argued that Eureko’s claims were predicated on contractual claims under a share purchase agreement making them inadmissible. The tribunal concluded that the Government breached Poland’s obligations under the Netherlands-Poland BIT. The case was settled in 2005 for about €2 billion in favour of the investor (Netherland-Poland BIT invoked).
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Main sources: CEO, Friends of the Earth, Public Citizen