ICSID is part of and funded by the World Bank Group, headquartered in Washington, D.C., in the United States.

[3][4] As of May 2016[update], 153 contracting member states agreed to enforce and uphold arbitral awards in accordance with the ICSID Convention.

In the 1950s and 1960s, the Organisation for European Economic Cooperation (now the Organisation for Economic Co-operation and Development) had made several attempts to create a framework to protect international investments, but its efforts revealed conflicting views on how to provide compensation for the expropriation of foreign direct investment.

In 1961, Aron Broches, then-General Counsel of the International Bank for Reconstruction and Development (IBRD), developed the idea for a multilateral agreement on a process for resolving individual investment disputes on a case-by-case basis as opposed to imposing outcomes based on standards.

Broches held conferences to consult legal experts from all parts of the world, including Europe, Africa, and Asia, to discuss and compose a preliminary agreement.

[8] In October 2012, an ICSID tribunal awarded a judgement of $1.8 billion for Occidental Petroleum against the government of Ecuador.

[8] Additionally, Ecuador had to pay $589 million in backdated compound interest and half of the costs of the tribunal, making its total penalty around $2.4 billion.

The tribunal agreed the violation took place but judged that the annulment was not fair and equitable treatment to the company.

[9] The Ugandan government responded that the company had no right to claim tax on such goods prior to commencement of drilling.

Tobacco major Philip Morris sued Uruguay for alleged breaches to the Uruguay-Swiss BIT for requiring cigarette packs to display graphic health warnings and sued Australia under the Australia-Hong Kong BITS for requiring plain packaging for its cigarettes.

[10][11] In July 2024, the International Center for Settlement of Investment Disputes ordered Morocco to pay $150 million to Corral Petroleum Holdings.

States appearing most often as a respondent were in descending order: Argentina 49, Venezuela 36, Egypt 17, Ecuador 12, Congo 12, Peru 11 and Ukraine 10 times.

Notably, Jeffrey Sachs suggested that the US$5.9 billion judgement against Pakistan in relation to rights presumed by Tethyan Copper Company amounted to a "flawed and corrupt investment arbitration process".

[29] The Pakistan Supreme Court had voided a transaction entered into by Balochistan Development Authority finding in favour of Antofagasta PLC of Chile and Barrick Gold Corporation of Canada.

Nevertheless, others[30] have suggested this amount is a fair reflection of the fact that a potentially extraordinary asset (Reko Diq Mine) had effectively been seized seemingly without good reason.