Do The Investor State Dispute Tribunals Erode National Sovereignty By Allowing Foreign Companies To Bypass Domestic Legal Systems?
Rishjvi Singh, CMR University School of Legal Studies, Bangalore
Swell in the role of ISDS tribunals to regulate international economic disputes
In recent years, international tribunals have become increasingly powerful tools for global economic regulation, often allowing foreign companies to bypass domestic legal systems to seek compensation for perceived harm caused by government actions. The mechanism related to ISDS is in place to ensure that if a foreign claimant has been wronged under any agreement, they shall have a forum to appear and to represent their case.
This development has raised concerns about the erosion of national sovereignty, as nations are increasingly unable to protect themselves from external interference in their domestic politics and laws. One primary example of this phenomenon is the steady increase in the number of investor-state disputes. Total ISDS cases had reached 1,023 by the end of 2019. Even though the majority of ISDS cases have been decided in favour of host States, some have been decided in favour of the investors and they are often offered an exorbitant amount of damages that reflect on the public budgets.
