One of the biggest barriers will be the legal infrastructure that oil and gas companies and some coal companies have constructed to defend their investments, through treaties like the energy charter treaty.
Russia’s top lender Sberbank initiated investment arbitration proceedings against Ukraine after its parliament approved a presidential decree allowing for the forced seizure of Sberbank-owned assets in the country.
Citing the free-trade agreement between Australia and Thailand, Kingsgate, announced in November 2017 that it had filed a suit against Thailand at an international arbitration tribunal.
We estimate that countries would face up to $340 billion in legal and financial risks for canceling fossil fuel projects that are subject to treaties with ISDS clauses.
Amendments to the mining law in Slovenia which prohibit the use of any hydraulic stimulation in mining exploitation constitute further breaches of the protections established by the BIT and the ECT.
In the context of investment treaties and arbitration, states should not put private arbitrators in the driver’s seat on issues of valuation of fossil fuel assets and compensation.
The ZEDEs are free from import and export taxes, but could set up their own internal forms of government, as well as courts, security forces, schools and even social security systems.
After years of dispute, the ICSID ruled last November that the province of Salta must pay an eight-figure sum as compensation. Argentina has only now decided to appeal the decision.