A/HRC/33/40 investors, arbitrators and new treaties bring investor-State dispute settlement into new domains. Such settlement leads to socializing losses and privatizing gains, 11 which is a recipe for social unrest. 9. The number of such cases is rising. From a total of 3 known cases in 1995, 70 new cases were registered during 2015. According to the United Nations Conference on Trade and Development (UNCTAD),12 investors triumphed in 60 per cent of admissible cases. In principle, States never “win”; all they can hope for is to be “acquitted”, and even then, they recover only a portion, if any, of their legal costs, which commonly reach millions of dollars. In Yukos Universal Limited (Isle of Man) v. the Russian Federation, the lawyers billed $74 million and the tribunal’s three arbitrators took home $7.4 million. The award amounted to $50 billion.13 10. The main financial beneficiaries of investor-State dispute settlement awards are not small investors or middle-sized enterprises, whose investment would be most needed for job creation and long-term development, but monopolies with at least $1 billion in annual revenue and individuals with a net worth of over $100 million. 14 11. The regulatory chill caused by the mere existence of investor-State dispute settlements has effectively dissuaded many States from adopting much-needed health and environmental protection measures. Peter Kirby of the law firm Fasken Martineau wryly described investor-State dispute settlement as “a lobbying tool in the sense that you can go in and say, ‘Okay, if you do this, we will be suing you for compensation’. It does change behaviour in certain cases.”15 The law firm Steptoe and Johnson has referred to investor protections as “a basis for preventing wrongful state conduct … As such, they may be a highly important tool for foreign investors and industry associations in advocating against legislative changes.”16 Although some treaties pro forma acknowledge State sovereignty, the reality is different. Professor David Boyd has noted that “while there is language in trade deals that purports to protect governments’ right to regulate, many arbitration panels have ignored or narrowly interpreted these provisions, making them practically useless.”17 Professor David Schneiderman frankly described the system as “an emerging form of supraconstitution … designed to insulate economic policy from majoritarian politics.”18 12. Several mega-regional treaties involving close to 90 States are currently under negotiation, mostly in secret. They include the Trans-Pacific Partnership Agreement,19 the Transatlantic Trade and Investment Partnership, the Comprehensive Economic and Trade Agreement, negotiated between the European Union and Canada, and the Trade in Services Agreement. If they enter into force with their investment chapters, the arbitration bonanza will massively expand. As Nobel laureate Joseph Stiglitz aptly put it, “corporations are attempting to achieve by stealth — through secretly negotiated trade agreements — what 11 12 13 14 15 16 17 18 19 4 Transnational Institute, “Socialising losses, privatizing gains” (Amsterdam, 2015). World Investment Report 2015, p. 116. www.iisd.org/itn/wp-content/uploads/2014/09/iisd_itn_yukos_sept_2014_1.pdf; http://globalarbitrationreview.com/news/article/35248/us50-billion-yukos-awards-set-aside-hague/. Pia Eberhardt, “The zombie ISDS: rebranded as ICS, rights for corporations to sue states refuse to die” (Brussels, Corporate Europe Observatory, 2016), p. 14. Pia Eberhardt, “The zombie ISDS”, p. 13. www.steptoe.com/publications-9867.html. www.thestar.com/opinion/commentary/2016/01/11/dont-let-trade-deals-hamper-climateprogress.html. David Schneiderman, Constitutionalizing Economic Globalization: Investment Rules and Democracy’s Promise, (New York, Cambridge University Press, 2008), p. 3. www.ohchr.org/EN/NewsEvents/Pages/DisplayNews.aspx?NewsID=17006. GE.16-11938