Investment protection agreements
Switzerland's investment protection agreements are unbalanced in favour of its multinationals when they invest abroad. Alliance Sud is calling for them to be rebalanced to enable host countries to enact legislation in the public interest and for the arbitration-based dispute settlement mechanism to be scrapped.
What it is about
With a foreign direct investment portfolio worth more than CHF 1460 billion, Swiss companies are among the world's 10 leading exporters of capital. To protect them, the Federal Council has concluded 111 Investment Protection Agreements (IPAs) with developing countries, with the notable exception of the Energy Charter Treaty, which also encompasses EU Member States and the EU itself.
Yet, these agreements almost exclusively assign rights to foreign investors and duties to host countries. Furthermore, they contain a dispute settlement mechanism, the Investor-State Dispute Settlement (ISDS) mechanism. It is unique in international law, as it allows a foreign company to sue a host country if it considers itself harmed under the treaty in force between the country of origin and the host country. Alliance Sud is calling for the rebalancing of these agreements and the scrapping of the ISDS.