Can foreign
companies sue local governments?
According to a piece in the Guardian:
“There are now
thousands of international investment agreements and free-trade acts, signed by
states, which give foreign companies access to the investor-state dispute
system, if they decide to challenge government decisions. Disputes are typically
heard by panels of three arbitrators; one selected by each side, and the third
agreed upon by both parties. Rulings are made by majority vote, and decisions
are final and binding. There is no appeals process – only an annulment option
that can be used on very limited grounds. If states do not pay up after the
decision, their assets are subject to seizure in almost every country in the
world (the company can apply to local courts for an enforcement order). While a
tribunal cannot force a country to change its laws, or give a company a permit,
the risk of massive damages may in some cases be enough to persuade a
government to reconsider its actions. The possibility of arbitration
proceedings can be used to encourage states to enter into meaningful settlement
negotiations.”