Chevron v Ecuador – Award Rejected By Ecuador

April 1, 2010

The Associated Press is reporting that Ecuador has unsurprisingly taken the position that they will not accept the partial award on the merits made earlier this week.

Understandably so, given that the award implies that the judicial system in Ecuador is ineffective at best and jaundiced against (at least some) foreign claimants at worst.

QUITO, Ecuador — Ecuadorean officials are rejecting an international arbitration tribunal’s ruling that it violated international law and must pay $700 million to the Chevron Corp.

President Rafael Correa’s administration is analyzing options for appeal under national and international law, Attorney General Diego Garcia said in a statement Wednesday.

“This new effort to compromise the Ecuadorean state in its firm commitment to respect the independence of its judicial system … will not succeed,” Garcia said.

Read the full article here

Two major avenues that immediately suggest themselves for Ecuador. The first is that Ecuador can appeal the award to a competent court. The second is to resist enforcement under the New York Convention and on the grounds of sovereign immunity. Both look like viable options.

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Chevron & Texaco v Ecuador – Denial of Justice Reaffirmed

April 1, 2010

The UNCITRAL tribunal in Chevron v Ecuador has released its first partial award on the merits, holding in favour of the oil company. This is the first part of a multi-stage arbitration that disposes of claims for US$ 700 million, with claims in total amounting to US$ 27 billion to be eventually decided by the tribunal.

Chevron claimed that they had been manifestly denied justice by the Ecuadorian courts, in violation of the ‘access to justice’ provision of Art II(7) of the USA – Ecuador BIT.

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Jessup 2011

March 30, 2010

ILSA has announced that the 2011 Jessup Compromis will address the legality of the use of unmanned drones and international anti-corruption law.

First things first – I think there has to be a special prize to one fellow judge who remarked that after a year of peaceful coexistence, Jessup would return to its root in war and chaos. I think unmanned drones and bribery fit right into that.

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Yukos v Russia – Banality After the Hype

February 8, 2010

Early last week, the interim awards on Jurisdiction and Admissibility in Hulley Enterprises Limited (Cyprus) v. The Russian Federation ,Yukos Universal Limited (Isle of Man) v. The Russian Federation,  and Veteran Petroleum Limited (Cyprus) v. The Russian Federation were published unilaterally by Sherman & Sterling.

Collectively, these three decisions might be thought of as Yukos v Russia –  all three claimants were shells designed to hold parts of the shareholding of Yukos for the managment and staff of Yukos and all claimed for losses suffered as a result of the bankruptcy of Yukos in 2008 that was said to be  caused for reasons ultimately attributable to the Russian Federation.

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Perenco v. Ecuador: Consensual Arbitrator Challenges

January 29, 2010

The Kluwer Arbitration Blog summarises why consensually circumventing the ICSID Convention procedure in Article 57 & Article 58 to disqualify an arbitrator by an external mechanism (through the Permanent Court of Arbitration in this case) is incorrect.

It is clear that the challenge to Judge Brower was not a proper one under the ICSID Convention. From an ICSID perspective, the decision of the PCA is a nullity. Indeed, the fact that Judge Brower had to resign voluntarily from his appointment as arbitrator after the PCA’s decision was rendered speaks volumes as to the validity of such proceedings. In fact, to the extent that Judge Brower had refused to resign, it is difficult to see how Ecuador would have had any remedy other than to start again and to propose his disqualification in accordance with Articles 57 and 58 of the Convention, which in turn would have provided a higher hurdle to overcome.

via Kluwer Arbitration Blog » Blog Archive » Perenco v. Ecuador: Was there a valid arbitrator challenge.

I do think there should be some reservation in the analysis adopted, especially the presumption of mandatory application of all provisions of the ICSID Convention ousting any scope for the consent of the parties in the conduct of the reference, which does seem to underlie parts of the analysis.

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The Inherent Jurisdiction of ICSID Tribunals: Rompetrol v Romania

January 21, 2010

The Rompetrol Group N.V. v. Romania, ICSID Case No. ARB/06/3 (Netherlands/Romania BIT) – Decision on the Participation of Counsel

The tribunal in Rompetrol v Romania was faced with a rather unique application. The Respondent  sought an order  requiring  the Claimant to remove their from the case and to forbid him from participating  any further in any way.

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The Inherent Jurisdiction of ICSID Annulment Committees: RSM v Grenada

January 19, 2010

RSM Production Corporation v. Grenada, ICSID Case No. ARB/05/14

In RSM v Grenada the claimant  applied to the Annulment Committee for it to make a finding of fact after the original arbitral tribunal was functus officio. RSM relied on the inherent jurisdiction of the Annulment Committee to support the application.

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