The American Lawyer - Focus Europe, Summer 2011

ARBITRATION SCORECARD

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companies—Cukurova Elektrik Anonim Sirketi and Kepez Elektrik Turk Anonim Sirketi—and canceled their concessions. While Turkey maintains that the utilities were owned by the Uzan family at the time of seizure, Cementownia was among several parties to say they had acquired the Uzans’ shares just prior to Turkey’s actions. In 2008 Mannheimer Swartling stepped down as claimant’s counsel, and Cementownia offered to withdraw its claim. However, Turkey refused and pointed to provisions of the ICSID Additional Facility rules, which stipulate that both parties to an arbitration must consent to the withdrawal of a claim. In September 2009 the arbitrators dismissed the claim with prejudice, finding that it was abusive and manifestly ill-founded. The panel awarded Turkey $5.3 million in fees and costs but declined to award damages.

AMOUNT IN CONTROVERSY: $4 billion

DISPUTE: World Wide Minerals Ltd. (Canada) v. Kazatomprom (Kazakhstan) and Republic of Kazakhstan CLAIMANT’S COUNSEL: Ogilvy Renault RESPONDENT’S COUNSEL: Shearman & Sterling; McGuire Woods ARBITRAL INSTITUTION AND SITE: Ad hoc (UNCITRAL)/ Stockholm NOTES: In the mid-1990s the Canadian mining company World Wide Minerals invested in a Kazakh uranium mine. WWM claims, however, that it did not receive promised export licenses and other rights under its agreements with the Kazakh state. WWM litigated against Kazakhstan and Kazatomprom for years in the U.S. courts, before finally opting for arbitration. WWM initially brought claims against both Kazakhstan and Kazatomprom, alleging breach of both contract and the Kazakh investment statute. After several months of discussions, WWM elected to go forward against Kazakhstan. Kazakhstan denied the claims, challenged them as untimely, and argued that the claimant lacked jurisdiction under the foreign investment law. The arbitrator dismissed WWM’s claims as untimely in December 2010.

AMOUNT IN CONTROVERSY: $3.8 billion

DISPUTE: Europe Cement Investment & Trade SA (Poland) v. Republic of Turkey CLAIMANT’S COUNSEL: Formerly Mannheimer Swartling RESPONDENT’S COUNSEL: Freshfields Bruckhaus Deringer; Cosar Avukatlik Burosu ARBITRAL INSTITUTION AND SITE: ICSID/Paris NOTES: This claim mirrors the Cementownia ICSID case, but was heard by a separate panel. The arbitrators consented to a Turkish demand that the Polish company produce evidence that it owns shares in a pair of Turkish hydroelectric companies. After counsel for the claimant withdrew in mid-2008, Europe Cement sought to withdraw its claim. However, Turkey insisted that the issues be given a thorough airing. In August 2009 the arbitrators dismissed the claim for lack of jurisdiction and awarded Turkey about $4 million in costs.

AMOUNT IN CONTROVERSY: $3 billion

DISPUTE: Maersk Olie, Algeriet A/S (Denmark) v. The People’s Democratic Republic of Algeria CLAIMANT’S COUNSEL: King & Spalding RESPONDENT’S COUNSEL: Curtis, Mallet-Prevost, Colt & Mosle ARBITRAL INSTITUTION AND SITE: ICSID/Paris NOTES: A dispute under the Algeria-Denmark BIT, concerning the

effect of Algeria’s new Tax on Exceptional Profits on a project in the Algerian petroleum industry. Maersk has filed a parallel commercial arbitration in conjunction with Anadarko Petroleum. A hearing on the merits is scheduled for November 2011.

AMOUNT IN CONTROVERSY: $2.8 billion DISPUTE: Telefonica S.A. (Spain) v. The Argentine Republic CLAIMANT’S COUNSEL: M. & M. Bomchil RESPONDENT’S COUNSEL: Attorney General of Argentina ARBITRAL INSTITUTION AND SITE: ICSID/Washington, D.C. NOTES: Telefonica complained that Argentina’s response to the peso crisis of 2001–02 led to an expropriation of its investment in Argentina’s telecommunications sector. Following a favorable jurisdictional ruling for Telefonica in 2006, the parties initiated talks regarding tariff rates and future investments. The arbitration was finally settled in August 2009.

AMOUNT IN CONTROVERSY: $2.4 billion

DISPUTE: OAO Tatneft (Russia) v. Ukraine

CLAIMANT’S COUNSEL: Cleary Gottlieb Steen & Hamilton RESPONDENT’S COUNSEL: King & Spalding; Dewey & LeBoeuf; Grischenko & Partners ARBITRAL INSTITUTION AND SITE: Ad hoc (UNCITRAL)/Paris NOTES: Tatneft complains that Ukraine failed to act to counter a former manager’s forcible takeover of the Kremenchug oil refinery, Ukraine’s largest, in October 2007. Tatneft, a Russian company, was a shareholder in the Ukrainian company that owns the refinery, Ukrtatnafta. Tatneft also complains that its direct and indirect shareholding in Ukrtatnafta have been taken by illegal Ukrainian court decisions. On that basis, Tatneft alleges breaches of the Ukraine-Russia BIT, which Ukraine denies. The arbitrators asserted jurisdiction in late 2010.

AMOUNT IN CONTROVERSY: Over $2.1 billion DISPUTE: World Motor Investments Holding S.A. (Luxembourg) and Auto-Kredyt Holding S.A. (Luxembourg) v. Republic of Poland CLAIMANT’S COUNSEL: Bogdan Fijalkowski RESPONDENT’S COUNSEL: K&L Gates ARBITRAL INSTITUTION AND SITE: Stockholm Chamber of Commerce/Stockholm NOTES: The claimants filed, and then promptly withdrew, this arbitration claim following preliminary objections from Poland. The dispute dates back to 2000, when Polish banking authorities declared a commercial bank to be insolvent.

AMOUNT IN CONTROVERSY: $2 billion

DISPUTE: Gold Reserve Inc. (U.S.) v. Bolivarian Republic of Venezuela CLAIMANT’S COUNSEL: White & Case RESPONDENT’S COUNSEL: Foley Hoag ARBITRAL INSTITUTION AND SITE: ICSID/Washington, D.C. NOTES: Canadian miner Gold Reserve complains that, following issuance of a construction permit for the Las Brisas project, one of the world’s largest undeveloped gold and copper mines, Venezuela improperly delayed the commencement of construction, revoked the construction permit, terminated the gold reserve’s concessions, and eventually took physical control of the mining property just days after Gold Reserve filed for arbitration in 2009. Venezuela denies the allegations.