Investor-State Dispute Settlement (ISDS) is a dispute resolution method included in hundreds of trade and investment agreements designed to give exclusive legal protection to foreign companies investing abroad, giving them the right to sue host governments in a private tribunal over any perceived breach of the rules around the treatment of investors. This secret corporate court system is system is a threat to Australia’s democracy and environment and we believe it should be banned.
Click here to read in full Friends of the Earth’s briefing on The case for banning Investor State Dispute Settlement in Australia
ISDS allows Foreign investors can bypass domestic courts and have their case heard by three arbitrators who decide whether the host state is liable to pay huge sums in compensation. The origins of the provisions came from the need to protect companies against the seizure of their assets by host states, for example a mine being nationalised without just compensation. Investment agreements have since evolved to include the values of non-discrimination, prohibition of performance requirements, fair and equitable treatment and free movement of capital, and most controversially, indirect expropriation, in which any government measure perceived to affect the actual or expected profits can be challenged.