Climate Change And Investor-State Dispute Settlement

Climate change litigation is often viewed by companies as a risk. However, it is also an opportunity—if brought in the right forum—for companies exposed to certain climate-related government measures to vindicate their rights. The past decade has seen increasing use of such a forum: Investor-State Dispute Settlement ("ISDS"). In ISDS cases, individuals and entities of one State can bring claims directly against another State for unlawful government interference with their foreign investment, so long as the two States have entered into a bilateral or multilateral treaty—and there are more than 3,000 such treaties—allowing these claims. A majority of ISDS cases are governed by the Convention on Settlement of International Investment Disputes, or the ICSID Convention.