This IIA Issues Note reviews 31 investor–State dispute settlement (ISDS) decisions rendered by arbitral tribunals in 2021. It covers high-profile decisions such as Eco Oro v. Colombia and several renewable energy-related cases under the Energy Charter Treaty such as Infracapital v. Spain.

About 95 per cent of the reviewed decisions concerned claims based on old-generation international investment agreements (IIAs) signed between 1980 and 2010. UNCTAD’s IIA Reform Accelerator, launched in November 2020, was developed to facilitate the interpretation, amendment and replacement of such IIAs.

ISDS decisions from 2021 touched upon important issues on the reform agenda for the investment treaty regime, including:

• Criteria for covered investments and investors
• Exclusions of taxation or other subject matters from the treaty scope
• Use of most-favoured-nation treatment to import provisions from respondent States’ IIAs with third countries
• Scope of fair and equitable treatment, legitimate expectations and regulatory stability
• Indirect expropriation
• Umbrella clauses, contract claims and other obligations
• Public policy exceptions
• Consent to investor–State arbitration, requirements and limitation periods for bringing ISDS claims

The review of recent ISDS decisions highlights the need to speed up the reform of the IIA regime. Reforms are essential to ensure that investment treaties and associated risks of investor–State disputes do not hinder countries’ efforts to address public policy concerns. While new-generation IIAs feature a larger number of reformed provisions aimed at safeguarding States’ right to regulate and reforming ISDS, questions remain whether the refinements are sufficiently robust to achieve the desired effects.

Building on its recent work on the reform of the IIA regime, UNCTAD’s World Investment Report 2023 presents a new toolbox to transform IIAs into instruments that actively support sustainable investment. This review of ISDS decisions, together with UNCTAD’s IIA reform tools, can help countries and regions make strategic choices concerning the future of the IIA regime.

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