International Arbitration Newsletter - December 2021 | Regional Overview: The Americas

COLOMBIA

Eco Oro succeeds in its dispute with Colombia

In the last 20 years Eco Oro has invested hundreds of millions of dollars in the development of the Project Angostura. However, in 2016, the government of Colombia undertook various measures to prohibit mining activities in the area.

Owing to this prohibition, Eco Oro filed a claim before ICSID requesting the compensation for the breach of the non-application of the fair and equitable standard in the bilateral investment treaty with Canada. The ICSID tribunal found in favour of Eco Oro, indicating that even though the measures taken by the Colombian government were legitimate, there had been a violation of minimum standard.

The decision was a matter of discussion within the Colombian government and the environment protection community, which maintains that the international investment arbitration system is fundamentally unfair and does not respect the complexity of the environmental and social facts of the case.

PERU

Third ICSID arbitration to start over Lima Metro System

Lima’s metro system’s concessionaire holder –a Spanish-Italian consortium which is in turn made up of Cosapi, Iridium, FCC, Salini Impregilo, Ansaldo STS and Ansaldo Breda– has commenced arbitration claims against Peru before ICSID. This is the third time that the consortium has initiated an ICSID arbitration against the Peruvian government for supposed delays to the opening of the metro project.

French companies commence arbitration against Peru

The French-registered companies Vinci Highways SAS and Vinci Concessions SAS have brought arbitration claims against Peru through their Peruvian subsidiary Lima Expresa (previosuly Lamsac) under the France-Peru BIT. Both companies through their subsidiary hold a concession for the Linea Amarilla highway.

This is the second time that Lima Express has been involved in an arbitral procedure against the Peruvian government over discrepancies in road concession management. In June 2020, after a similar dispute concerning Lima Express’ right to alter the local road toll quantity, an ICC tribunal issued award forcing Lima Express, the road concessionaire, to adjust the toll to fit local standards.

URUGUAY

Uruguay seeks enforcement against Italba in the US

On 6 December 2021 Uruguay requested a Florida court to enforce a favorable award against US company, Italba, over the damages that the American entity owes them as a result of a 2019 ICSID arbitration concerning the telecommunications sector.

Italba sought to bring an arbitration procedure against the Uruguayan government under the US-Uruguay BIT for allegedly interfering in the operations of the telecom company Trigosul, over which Italba claimed it had an active participation. The arbitral tribunal declined jurisdiction in the matter stating that Italba had failed to prove its investment in Trigosul and awarded Uruguay US$5.89 million in costs.

CHILE

Chinese company threatens Chile with an ICSID claim

In October 2021 Chile’s Civil Registry awarded the consortium formed by Chinese company Aisino and German company Mühlbauer with a concession for the handling of passports and ID cards.

Based on this, the U.S. Department of Homeland Security (DHS) and the U.S. Department of State made some statements related to the risks that the awarded concession might have on the integrity of Chilean national identification document data, which could also threaten the national and regional security of the United States of America.

It seems that these statements led the Chilean Civil Registry to annul the bidding process, claiming that there were inconsistences in the consortium’s bid which hadn’t been answered by Aisino, therefore breaching the rules of the bidding process. Some days after this, Chile’s Civil Registry awarded the concession instead to the French company Idemia.

Facing this scenario, Aisino has made public its intention to file an ICSID claim against Chile.

PANAMA

Florida court upholds ICC awards in favour of Panama Canal Authority

A Florida Court has confirmed an ICC arbitral award in favour of the Panama Canal Authority.  Jan De Nul, Sacyr and Webuild (together, GUPC SA) will have to pay US$270 million in damages to the Canal Authority over their interference in the Authority’s concrete aggregate production operations.

The investors claimed that there were serious questions over the tribunal’s impartiality, maintaining that the Canal Authority appointed arbitrator had had previous ties with the Panamanian government, and sought to have the award annulled. The Court held that there was no any evidence of bias on the arbitrators’ side and upheld the award.