Asia

Asian countries have signed over 1100 international investments agreements, most of which include the investor-state dispute settlement (ISDS) mechanism.

The Association of South-East Asian Nations or ASEAN (formed of Brunei, Burma, Cambodia, Indonesia, Laos, Malaysia, Philippines, Singapore, Thailand, Vietnam) also provides investor protection under the ASEAN Comprehensive Investment Agreement (ACIA) which was adopted in 2009.

In addition, new trade deals with ISDS provisions currently concern the region: the Trans-Pacific Partnership (TPP) and the Regional Comprehensive Economic Partnership (RCEP).

The TPP was sealed in October 2015 between Australia, Canada, Chile, Mexico, New Zealand, Peru, the United States and five Asian countries: Brunei, Japan, Malaysia, Singapore and Vietnam. Indonesia and Taiwan have claimed their intention to join in. The treaty has yet to be ratified.

The investment chapter has revealed the deal includes the investor-state dispute settlement (ISDS) mechanism that would give foreign investors the right to bypass national courts and resort to a parallel system of justice specifically made for them.

RCEP is currently being negotiated between the Asian states of Brunei, Cambodia, China, India, Indonesia, Japan, Laos, Malaysia, Myanmar, the Philippines, Singapore, South Korea, Thailand and Vietnam with Australia and New Zealand.

Although still under negotiations, RCEP has been reported to include ISDS provisions. Korea and Japan have submitted proposals likely to be similar to those in their own bilateral agreements and in the TPP text. India should table a different offer.

The Indian government has been considering a revised comprehensive model of bilateral investment treaty (BIT) that would reduce investor rights, compared to other versions of ISDS. An investor would have to exhaust all local remedies before initiating international arbitration. The model BIT is expected to exclude matters relating to government procurement, taxation, subsidies, compulsory licenses and national security.

India has been the most targeted country in the region, with about 15 disputes - the vast majority of which were initiated by West European countries.

End of 2014, Sri Lanka also announced its intention to move away from traditional models of BIT. It quoted thin relationship between BITs and foreign direct investment, past ISDS disputes and the tendency for BITs to constrain domestic policy space as reasons. Sri Lanka favours the enactment of appropriate domestic legislation to protect foreign investment.

In early 2014, Indonesia announced plans to terminate 67 of its BITs, former president Yudhoyono arguing he did not want multinational companies to pressure developing countries. Indonesia is now in the final stage of finalizing a new model of BIT. The country is currently facing a billion-dollar dispute from UK-listed Churchill Mining and a new US$600 million claim from the Indian mining investor India Metals & Ferro Alloys.

(November 2015)

Herbert Smith Freehills | 19-Sep-2018
An UNCITRAL arbitral tribunal has reportedly dismissed a US$36 million claim by a French investor, Louis Dreyfus Armateurs SAS (“LDA“), against India under the 1997 France-India bilateral investment treaty.
APWLD | 11-Sep-2018
“We call on our governments to either address the real reasons why ISDS is fundamentally flawed or to abandon its ‘reform’ agenda that is designed to reinforce and re-legitimise a self-serving investment dispute system.”
Business Standard | 10-Sep-2018
In a bid to fast-track the deal, most nations have agreed to ease the investor-state-dispute settlement (ISDS) clauses.
Financial Express | 5-Sep-2018
New Delhi won’t not take additional commitment on intellectual property rights beyond the TRIPS agreement it has already accepted at the WTO; investor-state dispute settlement (ISDS) mechanism only for limited sectors.
Korea Herald | 4-Sep-2018
Lawyers claim investor-state dispute settlement should be abolished in FTA as in NAFTA.
Yonhap | 4-Sep-2018
La Corée du Sud a dévoilé les clauses révisées de son accord de libre-échange avec les Etats-Unis et recueillera des opinions publiques sur ce dernier avant de le soumettre à l’Assemblée nationale.
Yonhap | 4-Sep-2018
South Korea will collect public opinions on the recently revised free trade agreement with the United States before sending it to the parliament for approval.
Manila Bulletin | 3-Sep-2018
Following the arbitral proceedings at the ICC, the government still faces another dispute relative to the Malampaya case at the ICSID, pursuant to the Philippines-Netherlands Bilateral Investment Treaty. Hearings are scheduled October 23-24 this year.
Vietnam Briefing | 28-Aug-2018
Vietnam and the EU have concluded their discussions on an Investment Protection Agreement, which they decided to keep it separate from their free trade agreement.
CIAR Global | 26-Aug-2018
El Centro Internacional de Arreglo de Diferencias Relativas a Inversiones (Ciadi) ha publicado las estadísticas de 2018, que muestran el registro de 57 casos.

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