brought under the dominican republic - central america - ita

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2.15. In summary, it is the Tribunal‟s opinion that it is not bound to accept the facts necessary to support or deny jurisdiction as alleged by the Claimant and the Respondent respectively; that the Claimant has the burden to prove facts necessary to establish jurisdiction (as it positively asserts); and that the Respondent has the burden to prove that its positive objections to jurisdiction are well-founded. Accordingly, for the purpose of this Decision, the Tribunal adopts a general approach to the Parties‟ disputed factual allegations whereby all the elements of proof adduced by the Parties are considered by the Tribunal for the purpose of assessing whether the Claimant and the Respondent have discharged their respective burdens to prove their respective cases. (03) The Respondent’s Case 2.16. In summary, the Respondent‟s presentation of its jurisdictional objection based on Abuse of Process begins with a statement of facts, which are not contested by the Claimant: ―Pacific Rim Mining Corp. is a Canadian company that applied for an environmental permit and a mining exploitation concession in El Salvador through one of its subsidiaries in 2004. The environmental permit and the concession were not granted. Three years later, in December of 2007, Pacific Rim Mining Corp. changed the nationality of another subsidiary, Pac Rim Cayman, from the Cayman Islands to the United States…‖ 8 2.17. The Respondent then makes its legal analysis on these facts, which (as will be seen later in this Decision) is strongly contested by the Claimant. In the Respondent‟s submission, the Claimant has “abused the provisions of CAFTA and the international arbitration process by changing Pac Rim Cayman's nationality to a CAFTA Party to bring a pre-existing dispute before this Tribunal under CAFTA.” 2.18. This objection is the major part of the Respondent‟s jurisdictional objections. As confirmed in its Jurisdiction Reply, “El Salvador's main jurisdictional objection is Claimant's Abuse of Process.” This was re-confirmed in the Respondent‟s letter dated 26 September 2011 sent to the Tribunal (cited in Part 1 above). 8 Jurisdiction Memorial, § 1. Part 2 – Page 5
2.19. In presenting this main objection, the Respondent does not object to prospective nationality planning made in good faith before any investment. The Respondent objects to the Claimant‟s change of nationality because of its timing at a much later date, made in deliberate bad faith: “What Claimant and its parent company did in the present case, however, is not prospective nationality planning but a retrospective gaming of the system to gain jurisdiction for an existing dispute based on existing facts over which there would not otherwise be jurisdiction. This is an abuse of the international arbitration system and process.” 9 2.20. The Respondent‟s position was summarised at the outset of its Post-Hearing Submissions: “Pacific Rim Mining Corp., a Canadian corporation, through its wholly-owned shell subsidiary, Pac Rim Cayman, has abused the international arbitration process by changing Pac Rim Cayman's nationality from the Cayman Islands to the United States, and then using this nationality to initiate ICSID arbitration proceedings for a pre-existing dispute and assert claims under CAFTA and the Investment Law of El Salvador as a national of the United States. The consequence of this abuse can only be the dismissal of this entire arbitration.” 10 (04) The Claimant’s Case 2.21. In summary, the Claimant submits that its change of nationality was not an abuse of process because it was part of an overall plan to restructure the Pac Rim group of companies. According to the Claimant, “(i)n 2007, the Companies were looking for ways to save money;” 11 and as a result, changes are alleged to have been envisioned, as follows: “This led to an examination of the overall corporate structure of the Companies. There were administrative costs involved in maintaining Pac Rim Cayman as a Cayman Islands entity. At the same time, the Companies were advised that there would be no adverse tax consequences to domesticating Pac Rim Cayman to Nevada – the jurisdiction from which it had been effectively managed by Mr. Shrake since 1997. In other words, the Companies believed that by domesticating Pac Rim Cayman to Nevada, they could eliminate the costs of maintaining Pac Rim Cayman in 9 10 11 Jurisdiction Memorial, § 18. Emphasis by the Respondent. The Respondent‟s Post-Hearing Submissions, § 2. Jurisdiction Counter-Memorial, § 136. Part 2 – Page 6
Page 1 and 2: IN THE MATTER OF AN ARBITRATION BEF
Page 3 and 4: One-Time Acts .....................
Page 5 and 6: Glossary of Defined Terms “CAFTA
Page 7 and 8: African Holding Company of America,
Page 9 and 10: Waste Management, Inc. v. United Me
Page 11 and 12: 1.4. Prior to 2 March 2012, the Cla
Page 13 and 14: C: The Tribunal’s Decision of 2 A
Page 15 and 16: 1.23. The Respondent: The Responden
Page 17 and 18: under cover of a letter also dated
Page 19 and 20: G: The Parties’ Claims for Relief
Page 21 and 22: c. Piercing the corporate veil (Mem
Page 23 and 24: H: The Jurisdictional Issues 1.46.
Page 25 and 26: (02) CAFTA 1.4. CAFTA Article 10.1:
Page 27 and 28: 2. At least 90 days before submitti
Page 29 and 30: measure alleged to constitute a bre
Page 31 and 32: (03) The ICSID Convention 1.13. ICS
Page 33 and 34: (5) ILC Articles on State Responsib
Page 35 and 36: proof or the Claimant‟s allegatio
Page 37: 2.11. Burden of Proof: As far as th
Page 41 and 42: precedented regulatory obstacles de
Page 43 and 44: 2.32. In its Post-Hearing Submissio
Page 45 and 46: SID Convention, nor relates to a
Page 47 and 48: But on the other side, an internati
Page 49 and 50: for such disputes would constitute,
Page 51 and 52: scribed in its early pleadings form
Page 53 and 54: 2.65. The Tribunal considers that t
Page 55 and 56: vestment (which by themselves are n
Page 57 and 58: minated; nothing more could have be
Page 59 and 60: to arbitrarily change or add new re
Page 61 and 62: 2.86. Accordingly, treating the rel
Page 63 and 64: 2.93. The Tribunal notes that this
Page 65 and 66: ability and not merely as a possibl
Page 67 and 68: 2.105. Having reached these several
Page 69 and 70: Tribunal‟s jurisdiction to determ
Page 71 and 72: 3.5. The Respondent also submits th
Page 73 and 74: cause there was only one applicatio
Page 75 and 76: leged de facto ban on mining was no
Page 77 and 78: Claimant, it came to light only in
Page 79 and 80: that led to the revocation should b
Page 81 and 82: 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
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Party [i.e. as the host State] whic
Page 103 and 104:
there were and are certain activiti
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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
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Party to also put in a witness stat
Page 133 and 134:
ture arbitration proceedings. Indee
Page 135 and 136:
this arbitration with the least exp
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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