What Are International Investment Agreements (IIAs)?
IIAs are bilateral or multilateral treaties that commit state-parties to afford specific standards of conduct to foreign investors from the other state-parties. These treaties grant foreign investors certain benefits, including recourse to Investor-State Dispute Settlement (ISDS) to resolve disputes with host states. Over 3,300 agreements have been concluded worldwide, including NAFTA and the Comprehensive and Progressive TransPacific Partnership.
What is Investor-State Dispute Settlement (ISDS)?
IIAs allow foreign investors (individuals and companies) to allege treaty violations by suing states through ad hoc arbitration. Arbitration tribunals are composed of party-appointed (and party-paid) private lawyers. Tribunals are not bound by precedent, and can order remedies (usually in the form of monetary awards) to investors if they find that states have breached treaty obligations. Notably, in most cases investors are not required to attempt to resolve disputes through available domestic remedies before filing ISDS claims. This is extraordinary and unusual: by contrast, the WTO only permits states to raise claims against other states, and international human rights courts require claimants to attempt to exhaust domestic remedies before raising disputes at the supranational level.
Dispute Resolution and Arbitration | International Law | Law | Securities Law | Transnational Law
Columbia Center on Sustainable Investment,
Primer: International Investment Treaties and Investor-State Dispute Settlement,
Available at: https://scholarship.law.columbia.edu/sustainable_investment_staffpubs/181