What is the International Convention on the Settlement of Investment Disputes (ICSID)?

The International Convention on the Settlement of Investment Disputes (ICSID) is a multilateral agreement that was created to provide an impartial system for resolving international disputes involving investments by individuals and companies. The Convention was signed in Washington, D.C. in 1965 and entered into force in 1966. The Convention is administrated by the World Bank and applies to investments made in any of the signatory countries. Under the Convention, signatory countries recognize the jurisdiction of ICSID in international investment disputes and agree to submit such disputes to ICSID for resolution. The Convention is intended to provide an international system for resolving such disputes between investors and states, rather than resorting to domestic courts which may have a bias towards one party over the other. In New Jersey, the Convention applies to investments made in any of the 162 signatory countries, and investors may invoke the Convention if their investments are negatively impacted by actions of the host state. For example, if the host state has nationalized the investors’ assets, the investor may seek to have their dispute resolved under the Convention. By having access to an impartial mechanism for international investment disputes, investors and states are given an important and reliable avenue for resolving such issues. ICSID has the legal authority to decide the case and enforce its decisions and settlements, making it a crucial part of international investment law.

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What is the International Convention on the Settlement of Investment Disputes (ICSID)?

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