UNCTAD publishes its annual review of investor-State dispute settlement cases

Apr 27 2011

UNCTAD's annual review of investor-State dispute settlement (ISDS) cases, part of the IIA Issues Notes series, provides up-to-date and country-specific information about ISDS developments in 2010.

2010 saw the lowest number of new treaty-based ISDS cases filed under international investment agreements since 2001. The number of known new cases was 25, bringing the total of all known cases to 390 by the end of the year. However, as most arbitration forums do not maintain a public registry of claims, the actual number of cases could potentially be higher. In 2010, Grenada and Uruguay saw the first claims directed at them, with one case each. As a result, the cumulative total of countries that have responded to investment treaty arbitration rose to 83.

Twenty awards, five decisions on liability, and 11 decisions on jurisdiction were rendered in 2010, as well as 11 other decisions on interim measures, discontinuance of proceedings, and costs. Of the 20 awards, 14 were in favour of the State and five were in favour of the investor, and one award embodied the parties' settlement agreement. With this, the overall balance of awards is now further tilted in favour of the State, with 78 cases won and 59 cases lost.

UNCTAD's review also offers a brief overview of the most important substantive and procedural issues addressed in the 2010 decisions, including, for example, interpretation of the fair and equitable treatment standard, prohibition of unreasonable or discriminatory measures, and treaty-based emergency exceptions. The review also looks at a number of annulment decisions, and observes that domestic courts are reviewing arbitral awards too.

The review concludes that States appear to be increasingly proactive in the ISDS process. They now aim at managing and controlling cases from the beginning, and/or actively question the tribunal's reasoning once a case has been concluded.

Developments regarding specific jurisdictional, substantive and procedural questions arising in ISDS cases are embedded in (and often emphasize the significance of) broader systemic issues, such as how to build a coherent international investment regime that fosters responsible investment and ensures sustainable development.