Investor-state dispute settlement
Corporate investments in a foreign country are regulated by a global web of international investment agreements. These agreements – which are made between states – offer legal protection to investments in one state by individuals or companies of a foreign state, particularly against measures that negatively impact property such as expropriation without compensation.
The agreements furthermore allow for arbitration tribunals to be convened in case of disputes concerning foreign investments. The International Centre for Settlement of Investment Disputes at the World Bank facilitates dispute resolution between states and companies. The decisions made by these arbitration tribunals are legally binding and can for example oblige a state to pay compensation to a company. In bilateral agreements, the adherence to human rights and environmental standards often only plays a minor role.