Both ENDS

News / 5 November 2025

Another ISDS claim hits the Netherlands: Petrogas sues over solidarity contribution and royalty regulations

SOMO and Both ENDS strongly condemn the newly revealed investor-state dispute settlement (ISDS) case filed by Petrogas, an Omani oil and gas company operating two shallow-water gas fields in the Dutch North Sea, against the Netherlands under the Netherlands-Oman bilateral investment treaty (BIT).

The case reportedly challenges the Dutch government’s introduction of a temporary solidarity contribution on windfall profits in the oil and gas sector - a measure designed to ensure that energy companies contribute fairly during a period of exceptional profits and social hardship. The contribution was part of a European Union-wide regulation adopted in response to the 2022 energy crisis, when soaring energy prices led to record profits for fossil fuel producers while households and businesses faced rising energy bills.

The case also appears to challenge the new Dutch conditional withholding tax on interest, royalties, and dividends, a measure first introduced in 2021 and extended in 2024. This tax aims to curb tax avoidance and profit shifting by imposing a levy on payments made by Dutch entities to related companies in low-tax jurisdictions or in certain abuse situations. Although Oman itself is not on the Dutch list of low-tax jurisdictions, the inclusion of this measure in Petrogas’s claim suggests that money flows to or through tax havens may be involved.

This case marks yet another instance of a foreign investor bypassing domestic courts and challenging policy decisions through international arbitration.

Bart-Jaap Verbeek, senior researcher SOMO:

“It’s deeply troubling that yet another fossil fuel company is resorting to ISDS to fight fiscal measures meant to protect the public interest. These parallel tribunals allow corporations to sidestep national legal systems and challenge democratically adopted policies. The Dutch government should not have to defend essential measures before secretive arbitration panels designed to protect investors, not citizens.”

Growing trend of ISDS cases

The Petrogas case follows a growing trend of ISDS claims in Europe over similar measures. Oil refiner Klesch Group has launched multiple cases against Germany, Denmark, and the European Union for their implementation of the same EU solidarity contribution, exposing how ISDS mechanisms can be weaponised to contest coordinated public responses to crises such as the energy and cost-of-living crises.

The Netherlands itself is facing at least two other ISDS cases:

Earlier, the Netherlands also faced two high-profile claims by RWE and Uniper over the coal phase-out law, in order to comply with the climate objectives under the Paris Agreement, both of which were later discontinued.

Fernando Hernández:

“These repeated ISDS claims show that the Netherlands is increasingly being targeted for taking necessary climate, fiscal, and social measures. For years, Dutch investment treaties have enabled similar claims against other countries. Now they are coming home to roost. It’s time for the Netherlands to take responsibility and end its support for ISDS once and for all.”

SOMO and Both ENDS call on the Dutch government to stop signing new treaties containing ISDS, terminate outdated treaties, and promote reliance on domestic courts and transparent and accountable judicial processes instead of closed, investor-biased tribunals.

As Europe transitions away from fossil fuels and seeks fair taxation of excess profits, it is imperative that governments retain their ability to act decisively in the public interest without the constant threat of costly investor lawsuits.

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