Colombia Moves to Withdraw from ISDS Treaty After 200 Economists Demand
Key Takeaways
- Petro announces plan to withdraw Colombia from the ISDS system.
- Open letter from over two hundred economists and jurists urges withdrawal.
- Withdrawal framed as reducing litigation risk and legal uncertainty.
Petro Declares Withdrawal
Colombia President Gustavo Petro announced his government will withdraw from the international investment arbitration system.
“The recent announcement by President Gustavo Petro regarding Colombia's intention to withdraw from the international investment arbitration system has sparked an intense legal, economic, and political debate”
The move follows an open letter signed by 200 economists including Stiglitz and Piketty.
ISDS allows investors to sue governments in international arbitration courts over disputes.
Petro asked why contracts allow a private centre in the contractor’s country to decide.
Several other countries including the US have left or are in the process of leaving the system.
Costs and Claims at Stake
The government argued Colombia faces approximately USD 14 billion at risk in arbitration disputes.
Colombia currently has 19 active investment agreements.
Experts warned the decision could generate new claims and affect legal certainty.
The Council on Foreign Relations noted peeling away from ISDS will not be straightforward.
Global Implications and Coordination
Petro framed Colombia's withdrawal as part of a rising global debate.
“Editing:Joe Lo Colombia’s President Gustavo Petroannouncedlast week that his government will “withdraw from the international investment arbitration system because the courts end up resolving disputes in favour of private entities””
In Europe many governments have started leaving the Energy Charter Treaty.
The First International Conference for the Transition Beyond Fossil Fuels provides a political opportunity.
Signatories warned withdrawal would be easier if coordinated with other countries.
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