Investor-State Dispute Settlement (ISDS) Clauses: Weapons of the Global North?
What are ISDS Clauses?
Investor State Dispute Settlement (ISDS) are mechanisms in FTAs or investment treaties that provide foreign investors with the right to access an international tribunal to resolve international disputes (DFAT, 2018). ISDS are included to provide protection through protection against sovereign or political risk for investors to promote foreign direct investment (FDI). However, the controversy that arises out of ISDS is its difficulty in balancing the interests of neo-liberal corporate FDI over the economic and territorial sovereignty of states to protect the interests of its citizens (Allee et Elsig, 2015). Australians investing overseas can utilise ISDS to seek compensation if their investments have been unfairly expropriated by the government of the investee country, haven’t received the minimum standards of treatment and have been the victim of unfair discrimination. An ISDS tribunal is limited to determining the breaches of certain investment obligations on a case by case basis as mechanisms of engaging ISDS will vary accordingly with different FTAs. Before investors can claim arbitration under either The International Centre for Settlement of Investment Disputes (ICSID), the ICISD Additional Facility Rules or The United Nations Commission on International Trade Law (UNCITRAL) rules…
