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(03) The Respondent’s Response 6.29. In summary, 205 by way of response to the Claimant‟s case on costs, the Respondent requests that the Tribunal order the Claimant to bear all the costs incurred by the Respondent in this arbitration because the Claimant initiated this arbitration about a mining exploitation concession which it did not have a right to receive, abusing the international arbitration process, and because it also has made a series of false, misleading and inconsistent statements before this Tribunal to try to keep its claims alive. 6.30. The Respondent submits that the Hearing confirmed that this arbitration is the result of an abuse of process by the Claimant and others: the Canadian company, Pacific Rim, had a dispute with the Respondent about its application for a mining exploitation concession in El Dorado; it spent three years trying to resolve the dispute by lobbying the Respondent‟s Government to change its Mining Law; those years of unsuccessful lobbying efforts made resolving that dispute appear increasingly unlikely; the Canadian company engaged international arbitration lawyers and then changed the nationality of its subsidiary (the Claimant) in December 2007 in order to procure arbitral jurisdiction under CAFTA for its pre-existing dispute with the Respondent. 6.31. The Respondent submits that the Claimant, unable to contest the overwhelming evidence that the dispute existed before its change of nationality in December 2007, has instead repeatedly tried to change its definition of the “measure at issue” and its explanation of when the dispute arose between the Parties. This tactical shifting of positions, according to the Respondent, has been the Claimant‟s common practice throughout this arbitration. 6.32. The Respondent contends that, unlike the Claimant, the Respondent has pursued its objections honestly and in good faith, seeking the quickest and most efficient resolution possible: the Respondent brought Preliminary Objections in an attempt to end 205 This summary of the Respondent‟s response and the Respondent‟s claim below are based on the Respondent‟s written submissions on costs of 10 and 24 June 2011. Part 6 - Page 10
this arbitration with the least expenditure of time and expense; only after extensive written submissions and denials in the Preliminary Objections phase did the Claimant accept that: (i) it never had a “perfected right” to a concession; and (ii) it had known of problems with its application and chose to try to lobby the Respondent‟s Government to change its legal requirements instead of complying with them. 6.33. In this jurisdictional phase, the Respondent submits that the Claimant sought to disregard its own nationality and relevant treaty provisions, wrongly insisting on its right to arbitrate even though it does not qualify to initiate CAFTA claims or to invoke ICSID jurisdiction against the Respondent; and that the Claimant again wasted time and expense before accepting these straightforward facts. The Respondent cites, as one example, the Claimant‟s continuous invocation of the activities of the “Pacific Rim Companies” to suggest that the Claimant had activities in the USA, even though it was forced to admit that the Claimant is a passive holding company with no activities beyond holding shares on paper. 6.34. The Respondent contends that these essential facts were not complicated; that these jurisdictional objections could have been argued concisely; but that the Claimant submitted a 256-page Jurisdiction Counter-Memorial and a 186-page Jurisdiction Rejoinder, sticking to the tactic: “if the facts are against you, focus on the law; if the law is against you, focus on the facts; if the law and the facts are against you, create distractions and confusion.” 6.35. The Respondent submits that the Claimant cannot hide from the true facts of this case: this dispute relates to the application for an environmental permit that was presumptively denied by the Respondent. By early 2007 at the latest, the Claimant knew that the concession application could not be approved until it either revised and resubmitted the application or succeeded in its efforts to change the Mining Law; but Pacific Rim changed the Claimant‟s nationality to the USA in December 2007 and later began these arbitration proceedings. 6.36. The Respondent contends that in all these circumstances, having been unfairly subjected to the Claimant‟s abusive process and to its abusive tactics and misconduct in this arbitration, the Respondent should not be required to bear any of the Claimant‟s Part 6 - Page 11
Page 1 and 2:
IN THE MATTER OF AN ARBITRATION BEF
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One-Time Acts .....................
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Glossary of Defined Terms “CAFTA
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African Holding Company of America,
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Waste Management, Inc. v. United Me
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1.4. Prior to 2 March 2012, the Cla
Page 13 and 14:
C: The Tribunal’s Decision of 2 A
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1.23. The Respondent: The Responden
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under cover of a letter also dated
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G: The Parties’ Claims for Relief
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c. Piercing the corporate veil (Mem
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H: The Jurisdictional Issues 1.46.
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(02) CAFTA 1.4. CAFTA Article 10.1:
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2. At least 90 days before submitti
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measure alleged to constitute a bre
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(03) The ICSID Convention 1.13. ICS
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(5) ILC Articles on State Responsib
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proof or the Claimant‟s allegatio
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2.11. Burden of Proof: As far as th
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2.19. In presenting this main objec
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precedented regulatory obstacles de
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2.32. In its Post-Hearing Submissio
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SID Convention, nor relates to a
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But on the other side, an internati
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for such disputes would constitute,
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scribed in its early pleadings form
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2.65. The Tribunal considers that t
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vestment (which by themselves are n
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minated; nothing more could have be
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to arbitrarily change or add new re
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2.86. Accordingly, treating the rel
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2.93. The Tribunal notes that this
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ability and not merely as a possibl
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2.105. Having reached these several
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Tribunal‟s jurisdiction to determ
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3.5. The Respondent also submits th
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cause there was only one applicatio
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leged de facto ban on mining was no
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Claimant, it came to light only in
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that led to the revocation should b
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for the purpose of deciding the Rat
Page 83 and 84: distinction made in the Commerce Gr
Page 85 and 86: EMELEC v. Ecuador (under the USA-Ec
Page 87 and 88: would qualify for treaty protection
Page 89 and 90: 4.17. (iii) Timeliness: The Respond
Page 91 and 92: the Respondent submits, to require
Page 93 and 94: ditiously resolved” (paragraph l)
Page 95 and 96: provided the Respondent with its No
Page 97 and 98: 4.44. The Claimant contends further
Page 99 and 100: lomatic protection within the meani
Page 101 and 102: Party [i.e. as the host State] whic
Page 103 and 104: there were and are certain activiti
Page 105 and 106: 4.74. It will be recalled that the
Page 107 and 108: der different arbitration rules, th
Page 109 and 110: 4.91. It follows that this third co
Page 111 and 112: Convention. 145 In the Respondent
Page 113 and 114: further express requirement of havi
Page 115 and 116: Legislativa was fully aware that th
Page 117 and 118: made before and after the Claimant
Page 119 and 120: 5.33. As established by the Interna
Page 121 and 122: 5.40. As also summarized above, the
Page 123 and 124: Government had always treated the C
Page 125 and 126: PART 6: ISSUE E - LEGAL AND ARBITRA
Page 127 and 128: 6.10. The Claimant submits that, un
Page 129 and 130: tion ratione temporis (i.e. the con
Page 131 and 132: Party to also put in a witness stat
Page 133: ture arbitration proceedings. Indee
Page 137 and 138: abused the Tribunal's indulgence in
Page 139 and 140: avoided; but, instead, the Responde
Page 141 and 142: “a U.S. investor organized under
Page 143 and 144: The Respondent acknowledges, of cou
Page 145 and 146: Claimant submits that under the cir
Page 147 and 148: ment in the communications with the
Page 149 and 150: 6.76. The Claimant submits that the
Page 151 and 152: PART 7: THE OPERATIVE PART 7.1. For
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