brought under the dominican republic - central america - ita

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The tribunal therefore concluded that there had been “no abuse of legal personality.” 36 2.50. In Aguas del Tunari v. Bolivia, 37 a Bolivian company had entered into a water concession contract with the Bolivian authorities. Bechtel, a US corporation, owned 55% of the shares in the Bolivian company, which were transferred to a Dutch company. The tribunal‟s jurisdiction was ostensibly derived from the Dutch-Bolivian BIT. Bolivia argued that the Dutch entity was a mere shell company created solely for the purpose of gaining access to ICSID and that, therefore, the tribunal had no jurisdiction under the BIT. The tribunal considered that the Dutch claimant was “not simply a corporation shell established to obtain ICSID jurisdiction over the case.” 38 The tribunal explained the dividing line between abuse of process and legitimate restructuring even after the making of an investment: ―… it is not uncommon in practice and – absent a particular limitation – not illegal to locate one‘s operation in a jurisdiction perceived to provide a beneficial regulatory and legal environment in terms, for example, of taxation or the substantive law of the jurisdiction, including the availability of a BIT.‖ 39 2.51. A statement to the same effect can be found in the Mobil decision, where the tribunal considered legitimate an “upstream” reorganization made in order to protect investments by gaining access to ICSID arbitration before any dispute, in contrast to an illegitimate “downstream” reorganization to the same effect with respect to a preexisting dispute: ―As stated by the Claimants, the aim of the restructuring of their investments in Venezuela through a Dutch holding was to protect those investments against breaches of their rights by the Venezuelan authorities by gaining access to ICSID arbitration through the BIT. The Tribunal considers that this was a perfectly legitimate goal as far as it concerned future disputes. With respect to pre-existing disputes, the situation is different and the Tribunal considers that to restructure investments only in order to gain jurisdiction under a BIT 36 37 38 39 Idem. The President, Prosper Weil, strongly dissented, stating: “The ICSID mechanism and remedy are not meant for investments made in a State by its own citizens with domestic capital through the channel of a foreign entity, whether pre-existent or created for that purpose. … Given the indisputable and undisputed Ukrainian character of the investment the Tribunal does not, in my view, give effect to the letter and spirit, as well as the object and purpose, of the ICSID institution.” Ibid., Dissenting Opinion, § 19 and § 20. Aguas del Tunari S.A. v. Republic of Bolivia, ICSID Case No. ARB/02/3, Decision on Jurisdiction, 21 October 2005. Ibid., § 321. Ibid., § 330 (d). Part 2 – Page 15
for such disputes would constitute, to take the words of the Phoenix Tribunal, ‗an abusive manipulation of the system of international investment protection under the ICSID Convention and the BITs‘. The Claimants seem indeed to be conscious of this, when they state that they ―invoke ICSID jurisdiction on the basis of the consent expressed in the Treaty only for disputes arising under the Treaty for action that the Respondent took or continued to take after the restructuring was completed.‖ 40 2.52. The Tribunal concludes from these and other legal materials submitted by the Parties that, in order to determine whether the Claimant‟s change of nationality was or was not an abuse of process, the Tribunal must first ascertain whether the relevant measure(s) or practice, which (as the Claimant allege) caused damage to its investments from March 2008 onwards, took place before or after the change in nationality on 13 December 2007. This approach in turn requires the Tribunal to ascertain the legal nature of the relevant measure(s) or practice alleged by the Claimant. 2.53. The Relevant Measure(s) or Practice: In order to identify these measures or practice, the Tribunal must necessarily analyse the Claimant‟s own pleadings. It will be recalled that the Tribunal decided, in its Decision of 2 August 2010, that the Notice of Intent was incorporated by reference into the Notice of Arbitration, and also to “treat the Notice of Arbitration as amended in the manner requested by the Claimant.” 41 Accordingly, the Claimant‟s early pleadings include both the Notice of Intent and the Notice of Arbitration. 2.54. The Notice of Intent pleads several alleged measures; and in the Notice of Arbitration, the same measures are pleaded. Starting with the Jurisdiction Counter- Memorial, the emphasis is increasingly placed by the Claimant on the alleged de facto ban publicly disclosed in President Saca‟s speech. 2.55. At this early stage, the Claimant based its pleaded case on the allegation that the Respondent had taken precise measures (in the plural) that improperly refused to grant to PRES an exploitation concession and to deliver to DOREX environmental permits. In its Jurisdiction Counter-Memorial, the Claimant alleged that the measure (in 40 41 Mobil v. Venezuela, supra note 27, §§ 204-205. Emphasis added. Decision on the Respondent‟s Preliminary Objections under CAFTA Articles 10.20.4 and 10.20.5, 2 August 2009, § 35. Part 2 – Page 16
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 and 38: 2.11. Burden of Proof: As far as th
Page 39 and 40: 2.19. In presenting this main objec
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: But on the other side, an internati
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
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lomatic protection within the meani
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Party [i.e. as the host State] whic
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there were and are certain activiti
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4.74. It will be recalled that the
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der different arbitration rules, th
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4.91. It follows that this third co
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Convention. 145 In the Respondent
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further express requirement of havi
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Legislativa was fully aware that th
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made before and after the Claimant
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5.33. As established by the Interna
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5.40. As also summarized above, the
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Government had always treated the C
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PART 6: ISSUE E - LEGAL AND ARBITRA
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6.10. The Claimant submits that, un
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tion ratione temporis (i.e. the con
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Party to also put in a witness stat
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ture arbitration proceedings. Indee
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this arbitration with the least exp
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abused the Tribunal's indulgence in
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avoided; but, instead, the Responde
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“a U.S. investor organized under
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The Respondent acknowledges, of cou
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Claimant submits that under the cir
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ment in the communications with the
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6.76. The Claimant submits that the
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PART 7: THE OPERATIVE PART 7.1. For
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