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TNI | 24 August 2020
by Cecilia Olivet and Bettina Müller
Peru, Mexico, Argentina, Bolivia and Guatemala are just some of the Latin American countries being hit by the investment protection regime in the midst of the COVID-19 pandemic. Foreign investors are threatening to bring claims before international arbitration tribunals due to the measures states are taking to mitigate the effects of the pandemic. Arbitrators are refusing to accept states’ requests to postpone ongoing arbitration cases and are obliging governments to disburse millions to investors at a time when public funds are required for more urgent priorities. Once again, the current crisis reveals the perverse consequences of the investor-state dispute settlement system and the urgent need to break free from it.
For decades, countries in Latin America and the Caribbean have been suffering the consequences of having signed more than 470 trade and investment protection agreements. Foreign investors have brought nearly 300 known claims before international arbitration tribunals against the region’s states. However, the COVID-19 pandemic and the crises it has unleashed could further exacerbate the risks of the investment protection regime by triggering a new wave of claims.
“Investment treaty protections are no longer viewed as remedies of last resort, but important tools in an investors’ armoury.” Simmons and Simmons law firm