CIJ Bertha Fellow: Lawyers Make Billions From State-Investor Arbitration

    Last year CIJ Bertha Fellows Claire Provost and Matt Kennard reported in the Guardian on the multinational companies suing developing states: The obscure legal system that lets corporations sue countries.

    This week, Provost and the Bureau of Investigative Journalism's Nick Mathiason follow up on that story to reveal how the burgeoning industry behind this court system has brought profits of over $2bn in legal fees for the lawyers involved. Much of this money comes directly from public funds; taking huge sums from the populations of the states being sued to cover the projected profits of the investor companies.

    These huge sums awarded to global multinationals are set to increase significantly. Cases filed at the World Bank division International Centre for Settlement of Investment Disputes (ICSID), which oversees the system, reached an all time high in 2015, while provisions in the Transatlantic Trade and Investment Partnership (TTIP) trade agreement - currently being negotiated behind closed doors in Brussels - are likely to prompt many more such cases.

    The effect of the system on democratic governance is, perhaps, the most worrying aspect.

    With the risk of being sued in an ICSID case becoming an increasingly standard consideration in the drafting and introduction of new legislation, regulations which might harm the interests of a multinational investor - such as environmental protections or the enshrinement of workers' rights - become less viable options.

    In this way sovereignty over national legislation is shifted from the democratic parliaments, supposedly working in the public interest, to private corporations driven by the interests of shareholders.

    Read the full piece at the Bureau of Investigative Journalism: The billions made by lawyers when multinationals put countries in the dock

    and watch the Bureau's video explainer below -