Investor-State Dispute Settlement

Investor-state dispute settlement (ISDS) is an instrument of public international law, that grants an Investor the right to use dispute settlement proceedings against a foreign government. Provisions for ISDS are contained in a number of bilateral investment treaties, in certain international trade treaties, such as the North American Free Trade Agreement (Chapter 11) and in international investment agreements, such as the Energy Charter Treaty. If an investor from one country (the "Home State") invests in another country (the "Host State"), both of which have agreed to ISDS, and the Host State violates the rights granted to the investor under public international law, then that investor may bring the matter before an arbitral tribunal.

While ISDS is often associated with international arbitration under the rules of ICSID (the International Centre for Settlement of Investment Disputes of the World Bank), it in fact often takes place under the auspices of international arbitral tribunals governed by different rules and/or institutions, such as the London Court of International Arbitration, the International Chamber of Commerce, the Hong Kong International Arbitration Centre or the UNCITRAL Arbitration Rules.