A little-known international arbitration system is gaining global power and allowing multinational corporations to sue entire countries.
Buzzfeed News spent months reporting on the scope and power of the investor-state dispute settlement, or ISDS, and just published a nearly 10,000-word investigative report on the system. If you don't have two hours to go through the whole tome, here are some highlights.
ISDS was originally intended to help international businesses protect their investments in other countries and in turn encourage development and more foreign investment. It part of the fabric of major international trade agreements like NAFTA and the proposed Trans-Pacific Partnership.
Buzzfeed's report features cases involving Egypt, El Salvador and Indonesia that suggest this "private, global super court" inordinately benefits corporations to the detriment of developing nations. It even touches on one of Donald Trump's former business partners who used the system to duck a prison sentence.
One major issue is that this system only works one way: corporations can sue countries, but governments can't sue the businesses, according to Buzzfeed. ISDS rulings are as legally binding as if they were made by a country's own supreme court, but the proceedings aren't beholden to precedent or public oversight, Buzzfeed reported.
Even the threat of filing an ISDS claim can be enough to push a nation to settle a dispute because the existence of ISDS cases damages a country's business reputation, Buzzfeed reported. For developing nations that can't afford to lose out on foreign investments, it often isn't worth the risk.