The investor-state dispute system, whereby foreign investors can sue the host-country government in an international tribunal, is one of the issues being negotiated in the Trans-Pacific Partnership Agreement.An American company Renco sued Peru for $800 million because its contract was not extended after the company’s operations caused massive environmental and health damage. This 200 photo shows children playing near the toxic site in play masks.
There is a pro-investor bias in many cases, with decisions or arguments that are quite clearly unfair to the governments being sued. However, there is no appeal possible.
The claims have tended to be very high in recent years, running to billions of US dollars. Awards are usually lower, but recent ones can also be very high, such as the $2.3 billion award granted by ICSID to an American oil company against Ecuador.
Other recent investor-state dispute cases include one taken against South Africa by a European mining company claiming losses from the government’s black empowerment programme, and a $2 billion claim against Indonesia by a UK-based oil company after its contract was cancelled because it was not in line with the law.
