^* This text was reproduced and reformatted from the text available at the ICSID website: (visited August 17, 2009) <http://icsid.worldbank.org/ICSID/FrontServlet?requestType=CasesRH&actionVal=viewCase&reqFrom=Home&caseId=C247=.

^* This text was reproduced and reformatted from the text available at the ICSID website: (visited August 17, 2009) <http://icsid.worldbank.org/ICSID/FrontServlet?requestType=CasesRH&actionVal=viewCase&reqFrom=Home&caseId=C74=.

¹ See Report of the Executives Directors on the Convention on the Settlement of Investment Disputes between States and National of other States, ¶ 27 (1965).

² Walid Ben Hamida, La notion d’investissement: la notion maudite du systeme CIRDI? in 349 Gazette du Palais 33 (Dec. 15, 2007).

³ Id. ¶ 40. The literal English translation for the French term ‘‘maudite.’’

⁴ The panel was composed of Brigitte Stern (president), Andreas Bucher, and Juan Fernandez-Armesto.

⁵ The ad hoc committee was composed of judges Stephen Schwebel (president), Mohamed Shahabuddeen, and Peter Tomka.

⁶ The grounds for annulment under the ICSID Convention are narrow. Article 51(1) reads:

⁷ See Christoph Schreuer, The ICSID Convention: A Commentary 901 (2009).

⁸ Id.

⁹ Id.

¹⁰ Pursuant to the agreement, the title of the recovered property was to pass to the Malaysian government; the applicant was entitled only to a service fee of seventy percent of the proceeds of an auction at Christie’s. The porcelain was auctioned for an amount of $2.98 million, but Malaysian Historical Salvors allegedly received only forty percent of the auction proceeds. Malaysian Historical Salvors also accused Malaysia of retaining $400,000 worth of items by withholding them from the auction.

¹¹ Malaysian Historical Salvors, Sdn., Bhd. v. Government of Malaysia, ICSID Case No.ARB/05/10, Award ¶ 147 (May 17, 2007), available at http://ita.law.uvic.ca/documents/MHSjurisdiction.pdf.

¹² Malaysian Historical Salvors, Sdn., Bhd. v. Government of Malaysia, ICSID Case No. ARB/05/10, Annulment Award ¶ 107 (Apr. 16, 2009), available at http://arbitration.fr/resources/ICSID-ARB-06-5.pdf [hereinafter Malaysian Salvors Annulment Award].

¹³ Salini Costruttori S.p.A. & Italstrade S.p.A. v. Kingdom of Morocco, ICSID Case No. ARB/00/4, Jurisdiction (July 23, 2001), 42 I.L.M. 609 (2003) [hereinafter Salini]. The five criteria are benchmarks originally suggested by the arbitral tribunal in Fedax N.V. v. Republic of Venezuela, ICSID Case No. ARB/96/3, Decision on Jurisdiction (July 11, 1997), 5 ICSID Rep. 183 (2002), 42 I.L.M. 609 (2003).

¹⁴ Id. ¶ 148.

¹⁵ Id. ¶ 146.

¹⁶ Yulia Andreeva, Malaysia: Malaysian Historical Salvors v. Malaysia –Interpretation of the Term ‘‘Investment’’, 11 Int’l Arb. L. R. 36, 37-39 (2008).

¹⁷ Compania de Aguas del Aconquija S.A and Vivendi Universal S.A v. Argentine Republic, ICSID Case No. ARB/97/3, Annulment Award (July 3, 2002), 41 I.L.M. 1153 (2002).

¹⁸ Andreeva, supra note 16, at 39. See also Emmanuel Gaiilard, Identify or Define? in International Investment Law for the 21^st Century 415 (2009).

¹⁹ Malaysian Salvors Annulment Award, ¶ 71.

²⁰ Id. (citing ¶ 23 of the Report of the Executive Directors).

²¹ Malaysian Salvors Annulment Award, ¶ 79 (citing the Biwater case, infra note 22).

²² Biwater Gauff (Tanzania) Ltd. v. United Republic of Tanzania, ICSID Case No. ARB/05/22, Award (July 24, 2008), available at http://icsid.worldbank.org/ICSID/FrontServlet?request-Type=CasesRH&actionVal=showDoc&docId=DC770_En&caseId=C67.

²³ Malaysian Salvors Annulment Award, ¶ 59.

²⁴ Agreement between the Government of the United Kingdom of Great Britain and Northern Ireland and the Government of Malaysia for the Promotion and Protection of Investments art. 1(a), May 21, 1981. The text is available at http://www.miti.gov.my/cms/storage/documents/569/com.tms.cms.document.Document_9eebbd0a-c0a81573-f8e0f8e0-7a847b1a/1/uk.pdf.

²⁵ Malaysian Salvors Annulment Award, ¶ 57.

²⁶ For a study of the intuitive and deductive approaches, see Gaiilard, supra note 18, at 407.

²⁷ See Devashish Krishan, A Notion of ICSID Investment, in Investment Treaty Arbitration and International Law 61-84 (Todd Weiler ed., 2008). See also Gaillard, supra note 18, at 409; Ibrahim Fadlallah, La notion d’investissement: vers une restriction a la competence du CIRDI?, in Liber Amicorum Robert Briner 267 (2005); and Schreuer, supra note 7.

²⁸ Malaysian Salvors Annulment Award, ¶ 62.

²⁹ Id. ¶ 39 (Shahabuddeen, J., dissenting).

³⁰ Id. ¶ 43.

³¹ Id.

³² Id. ¶ 44.

³³ Id. ¶ 42.

³⁴ The two disputes were Benet Praha against the Czech fiscal authorities and Benet Group against a private party.

³⁵ Phoenix Action, Ltd. v. Czech Republic, ICSID Case No. ARB/06/5, Award ¶ 34 (Apr. 15, 2009), available at http://www.arbitration.fr/resources/ICSID-ARB-06-5.pdf [hereinafter Phoenix].

³⁶ Id.

³⁷ Id.

³⁸ Id. ¶ 135.

³⁹ Id. ¶ 139.

⁴⁰ Id. ¶ 142.

⁴¹ Id. ¶ 143.

⁴² Id. ¶ 82.

⁴³ Id. at 45.

⁴⁴ Id. ¶ 114.

⁴⁵ Id. ¶ 85.

⁴⁶ Id. ¶ 114.

⁴⁷ Id. ¶ 85.

⁴⁸ Id. ¶ 93.

⁴⁹ The principle of good faith, the Tribunal emphasized, required that a legitimate investment be in accordance with the laws of the host state and bona fide.

⁵⁰ Id. ¶ 113.

⁵¹ Id. ¶ 97, n.67.

⁵² Id. ¶ 113.

⁵³ Id. ¶ 101.

⁵⁴ Id. ¶ 74.

⁵⁵ Id.

¹ Malaysian Historical Salvors Sdn., Bhd. v. The Government of Malaysia, ICSID Case No. ARB/05/10, Award on Jurisdiction, May 17, 2007 (‘‘Award’’).

² 14 October 1966.

³ Contract No. IPL3/1991 dated 3 August 1991 between the Government of Malaysia and Malaysian Historical Salvors Sdn., Bhd. (with Variation Order No. 1/1993 dated 12 April 1993 and Extension of Contract dated 12 July 1994) (‘‘Contract’’).

⁴ Contract, Preamble.

⁵ Id.

⁶ Id., Clause 15.1.

⁷ Id., Clause 26.1.

⁸ Id., Clause 2.2.

⁹ See id., Clause 4.

¹⁰ Agreement No. PERB/PK/116/1994 dated 22 September 1994 between the Government of Malaysia, Malaysian Historical Salvors and Christie’s Amsterdam B.V. (‘‘Agreement 116/1994’’).

¹¹ Id., Clause 2.2.

¹² Contract, Clause 4.1.1.

¹³ See Award, paras. 18–25.

¹⁴ Article 1 of the BIT provides, in part: ‘‘[f]or the purposes of the Agreement, (1)(a) ‘investment’ means every kind of asset and in particular, though not exclusively, includes: . . . (iii) claims to money or to any performance under contract, having a financial value; . . . (v) business concessions conferred by law or under contract, including concessions to search for, cultivate, extract or exploit natural resources.’’

¹⁵ Award, para. 151

¹⁶ Article 25(1) of the ICSID Convention provides that ‘‘[t]he jurisdiction of the Centre shall extend to any legal dispute arising directly out of an investment, between a Contracting State (or any constituent subdivision or agency of a Contracting State . . . ) and a national of another Contracting State, which the parties to the dispute consent in writing to submit to the Centre.’’

¹⁷ The Applicant relied on Salini Costruttori S.p.A. and Italstrade S.p.A. v. Kingdom of Morocco, ICSID Case No. ARB/00/4, Decision on Jurisdiction, 23 July 2001, an English translation of which is found at 6 ICSID Reports 400 (2004), (‘‘Salini v. Morocco’’),; Joy Mining Machinery Limited v. Arab Republic of Egypt, ICSID Case No. ARB/03/11, Award on Jurisdiction, 6 August 2004 (‘‘Joy Mining v. Egypt’’); and Consorzio Groupement L.E.S.I. - DIPENTA v. People’s Democratic Republic of Algeria, ICSID Case No. ARB/03/8, Award, 10 January 2005 (‘‘L.E.S.I.- DIPENTA v. Algeria’’).

¹⁸ Alcoa Minerals of Jamaica, Inc. v. Jamaica, ICSID Case No. ARB/74/2, Alcoa Minerals of Jamaica, Inc. v. Jamaica, ICSID Case No. ARB/74/2, Decision on Jurisdiction and Competence, 6 July 1975 (‘‘Alcoa v. Jamaica’’).

¹⁹ Contract, Preamble.

²⁰ See Award, para. 47.

²¹ 23 May 1969, 1155 UNTS 331.

²² Award, para. 56.

²³ Id. The seven cases ‘‘of importance’’ were Salini v. Morocco; Joy Mining v. Egypt; L.E.S.I.- DIPENTA v. Algeria; Jan de Nul N.V. and Dredging International N.V. v. Arab Republic of Egypt, ICSID Case No. ARB/04/13, Decision on Jurisdiction, 16 June 2006 (‘‘Jan de Nul v. Egypt’’); Bayindir Insaat Turizm Ticaret Ve Sanayi A.S. v. Islamic Republic of Pakistan, ICSID Case No. ARB/03/29, Decision on Jurisdiction, 14 November 2005 (‘‘Bayindir v. Pakistan’’); Èeskoslovenská obchodní banka, a.s. v. Slovak Republic, ICSID Case No. ARB/97/4, Decision of the Tribunal on Objections to Jurisdiction, 24 May 1999 (‘‘CSOB v. Slovak Republic’’); and Patrick Mitchell v. The Democratic Republic of Congo, ICSID Case No. ARB/99/7, Decision on the Stay of Enforcement of the Award, 9 February 2004 (‘‘Patrick Mitchell v. DRC’’).

²⁴ Award, para. 70.

²⁵ Id., para. 104.

²⁶ See Salini v. Morocco, paras. 50–58.

²⁷ See Joy Mining v. Egypt, paras. 42–63.

²⁸ Award, para. 78.

²⁹ Id., para. 106.

³⁰ Award, para. 106.

³¹ Id., para. 107.

³² Id., para. 108.

³³ Id., para. 109.

³⁴ Id., para. 110.

³⁵ Award., para. 111.

³⁶ Id., para. 112.

³⁷ Id.

³⁸ Id., para. 123.

³⁹ Id., para. 130.

⁴⁰ Id., para. 144.

⁴¹ Award, para. 144.

⁴² Id., para. 146.

⁴³ Id., para. 148.

⁴⁴ Application for Annulment, para. 8.

⁴⁵ Compañía de Aguas del Aconquija S.A. and Vivendi Universal S.A. v. Argentine Republic, ICSID Case No. ARB/97/3, Decision on Annulment, 3 July 2002, para. 86: ‘‘[i]t is settled, and neither party disputes, that an ICSID tribunal commits an excess of powers not only if it exercises a jurisdiction which it does not have under the relevant agreement or treaty and the ICSID Convention, read together, but also if it fails to exercise a jurisdiction which it possesses under those instruments.’’

⁴⁶ See Applicant’s Memorial, paras. 42–48.

⁴⁷ See Applicant’s Memorial, paras. 50–55.

⁴⁸ See id., paras. 57–67, 74.

⁴⁹ Article 32 of the Vienna Convention provides: ‘‘[r]ecourse may be had to supplementary means of interpretation, including the preparatory work of the treaty and the circumstances of its conclusion, in order to confirm the meaning resulting from the application of article 31, or to determine the meaning when the interpretation according to article 31: (a) leaves the meaning ambiguous or obscure; or (b) leads to a result which is manifestly absurd or unreasonable.’’

⁵⁰ See Applicant’s Memorial, paras. 50–57.

⁵¹ Applicant’s Memorial, paras. 31–33, citing Award, headings at pp. 35–43.

⁵² Id., para. 79, citing Award, para. 106(d) and (e).

⁵³ Id., paras. 32, 77.

⁵⁴ Id., para. 82.

⁵⁵ Id., para. 69.

⁵⁶ Victor Pey Casado et Fondation ‘Presidente Allende’ c. République du Chili, ICSID Case No. ARB/98/2, Sentence arbitrale, 8 May 2008.

⁵⁷ Applicant’s Memorial, para. 71, citing Pey Casado v. Chili, para. 232.

⁵⁸ Id., para. 39.

⁵⁹ Applicant’s Memorial, para. 85.

⁶⁰ Id., para. 84.

⁶¹ Id., para. 87, citing Award, para. 108.

⁶² Id., para. 90, citing Award, para. 109.

⁶³ Id., para. 92.

⁶⁴ Id., para. 93.

⁶⁵ Id., para. 98, citing Award, para. 111.

⁶⁶ See Applicant’s Memorial, paras. 98–101.

⁶⁷ Id., para. 99.

⁶⁸ Id., para. 105, citing Award, para. 112.

⁶⁹ Id., paras. 106–107.

⁷⁰ Id., para. 121.

⁷¹ Id., para. 116, citing Award para. 132.

⁷² Id., paras. 110–113, 121.

⁷³ Applicant’s Memorial, para. 121.

⁷⁴ Id., p. 7, footnote 32.

⁷⁵ Applicant’s Reply, para. 19.

⁷⁶ Applicant’s Memorial, para. 129 and Applicant’s Reply, para. 77.

⁷⁷ Respondent’s Counter-Memorial, para. 122.

⁷⁸ Id., para. 39.

⁷⁹ Id., Title of Section III.

⁸⁰ Respondent’s Counter-Memorial, para. 36.

⁸¹ Respondent’s Counter-Memorial, para. 43.

⁸² See id., para. 46.

⁸³ Id., para. 51.

⁸⁴ Id., para. 55.

⁸⁵ Id., para. 56.

⁸⁶ See Respondent’s Counter-Memorial., paras. 62–68.

⁸⁷ Id., paras. 65, 68.

⁸⁸ Id., para. 70.

⁸⁹ Id., para. 85, citation omitted.

⁹⁰ Id., para. 85.

⁹¹ Id., para. 86, relying on L.E.S.I-DIPENTA v. Algeria, para. 13(iv) and Pey Casado v. Chili, paras. 231–232.

⁹² See Respondent’s Counter-Memorial, paras. 87–100.

⁹³ Id., para. 90.

⁹⁴ Id., para. 100.

⁹⁵ See id., paras. 101–123.

⁹⁶ Id., para. 106, citing Mark B. Feldman, The Annulment Proceedings and the Finality of ICSID Arbitral Awards, 2 ICSID Review – F.I.L.J. 101 (1987).

⁹⁷ Id., para. 112, citing CDC Group plc v. Republic of Seychelles, ICSID Case No. ARB/02/14, Decision of the ad hoc Committee on the Application for Annulment of the Republic of Seychelles, 29 June 2005 (‘‘CDC Group v. Seychelles’’), para. 42.

⁹⁸ See Respondent’s Counter-Memorial, paras. 120–123.

⁹⁹ Id., para. 123.

¹⁰⁰ Id., para. 125 and Respondent’s Rejoinder, para. 100.

¹⁰¹ Vienna Convention, Article 4.

¹⁰² Article 31 provides:1.A treaty shall be interpreted in good faith in accordance with the ordinary meaning to be given to the terms of the treaty in their context and in the light of its object and purpose.

2.The context for the purpose of the interpretation of a treaty shall comprise, in addition to the text, including its preamble and annexes:

(a)any agreement relating to the treaty which was made between all the parties in connection with the conclusion of the treaty;

(b)any instrument which was made by one or more parties in connection with the conclusion of the treaty and accepted by the other parties as an instrument related to the treaty.

There shall be taken into account, together with the context:

(a)any subsequent agreement between the parties regarding the interpretation of the treaty or the application of its provisions;

(b)any subsequent practice in the application of the treaty which establishes the agreement of the parties regarding its interpretation;

(c)any relevant rules of international law applicable in the relations between the parties.

A special meaning shall be given to a term if it is established that the parties so intended.

¹⁰³ See supra note 49 for the text of Article 32 of the Vienna Convention.

¹⁰⁴ See Territorial Dispute (Libyan Arab Jamahiriya/Chad), Judgment, I.C.J. Reports 1994, pp. 21-22, para. 41; Kasikili/Sedudu Island (Botswana/Namibia), Judgment, I.C.J. Reports 1999, p. 1059, para. 18.

¹⁰⁵ ICSID, History of the ICSID Convention: Documents Concerning the Origin and the Formulation of the Convention on the Settlement of Investment Disputes Between States and Nationals of Other States (‘‘History of the ICSID Convention’’), Volume I, p. 16 (1968).

¹⁰⁶ Award, para. 148.

¹⁰⁷ Id., para. 143.

¹⁰⁸ History of the ICSID Convention, Volume II-1, p. 33.

¹⁰⁹ Id., Volume II-1, p. 34.

¹¹⁰ Id.

¹¹¹ Id., Volume I, p. 116.

¹¹² Id.

¹¹³ Id., Volume II-2, p. 844.

¹¹⁴ ‘‘In a draft preceding the Working Paper, a lower limit ($100,000) had been fixed for the subject-matter of the dispute. That provision had not been retained . . . because disputes involving small amounts could be important as test cases, whereas there would be other cases in which it would be impossible to place a pecuniary value on the subject-matter of a dispute.’’ History of the ICSID Convention, Volume II-1, p. 567.

¹¹⁵ Christoph, Schreuer, The ICSID Convention: A Commentary, p. 123 (2001), citing to History of the ICSID Convention, Volume II-2, p. 826.Google Scholar

¹¹⁶ History of the ICSID Convention, Volume II-1, p. 54.

¹¹⁷ History of the ICSID Convention, Volume II-1, p. 566.

¹¹⁸ International Bank for Reconstruction and Development, Report of the Executive Directors on the Convention on the Settlement of Investment Disputes Between States and Nationals of Other States, March 18, 1965 (‘‘Report of the Executive Directors’’), paras. 23, 25, 27.

¹¹⁹ Salini v. Morocco, para. 44.

¹²⁰ Salini v. Morocco, para. 52.

¹²¹ Schreuer, supra note 115, p. 140.

¹²² See Yulia Andreeva, Salvaging or Sinking the Investment? MHS v. Malaysia Revisited, The Law and Practice of International Courts and Tribunals, Volume 7, No. 2, 2008, p. 161, and Devavish Krishan, A Notion of ICSID Investment, in T. Weiler (ed.), Investment Treaty Arbitration: A Debate and Discussion (2008).

¹²³ Biwater Gauff (Tanzania) Limited v. United Republic of Tanzania, ICSID Case No. ARB/05/22, Award, 24 July 2008 (‘‘Biwater v. Tanzania’’).

¹²⁴ Biwater v. Tanzania, paras. 310, 312–18.

¹ Convention on the Settlement of Investment Disputes Between States and Nationals of Other States, 14 October 1966.

² See International Bank for Reconstruction and Development, Report of the Executive Directors on the Convention on the Settlement of Investment Disputes Between States and Nationals of Other States (‘‘Report of the Executive Directors’’), para. 27: ‘‘No attempt was made to define the term ‘investment’ given the essential requirement of consent by the parties, and the mechanism through which Contracting States can make known in advance, if they so desire, the classes of disputes which they would or would not consider submitting to the Centre (Article 25(4)).’’

³ 23 May 1969, 1155 UNTS 331 (‘‘Vienna Convention’’).

⁴ However it may be construed, the ‘‘context,’’ as stated in the Vienna Convention, cannot be entirely neutralised.

⁵ Vienna Convention, Article 31(1), footnote not in original.

⁶ Víctor Pey Casado and President Allende Foundation v. Republic of Chile, ICSID Case No. ARB/98/2, Decision, 25 September 2001 (‘‘Pey Casado v. Chile’’), para. 232, translation of the original text by the Committee Member.

⁷ Applicant’s Memorial, para. 62, footnote 70. The Applicant goes on to argue about the ‘‘subjective approach,’’ but this does not remove the effect of his earlier admission.

⁸ Christoph Schreuer, The ICSID Convention: A Commentary, p. 91 (2001).

⁹ The Rompetrol Group N.V. v. Romania, ICSID Case No. ARB/06/3, Decision on Jurisdiction and Admissibility, 18 April 2008 (‘‘Rompetrol v. Romania’’), para. 80.

¹⁰ Schreuer, supra note 8, p. 90.

¹¹ ICSID, History of the ICSID Convention: Documents Concerning the Origin and the Formulation of the Convention on the Settlement of Investment Disputes between States and Nationals of Other States (‘‘History of the ICSID Convention’’), Volume II-1, p. 566 (1968).

¹² Patrick Mitchell v. Democratic Republic of the Congo, ICSID Case No. ARB/99/7, Decision on the Application for Annulment of the Award, 1 November 2006 (‘‘Patrick Mitchell v. DRC’’), para. 31.

¹³ Report of the Executive Directors, para. 9.

¹⁴ Amco Asia Corporation and others v. Republic of Indonesia, ICSID Case No. ARB/81/1, Decision on Jurisdiction, 25 September 1983 (‘‘Amco v. Indonesia’’). See also id., Award, 20 November 1984.

¹⁵ ICSID Convention, Article 17. The full text of Article 17 provides: ‘‘[i]f the expenditure of the Centre cannot be met out of charges for the use of its facilities, or out of other receipts, the excess shall be borne by Contracting States which are members of the Bank in proportion to their respective subscriptions to the capital stock of the Bank, and by Contracting States which are not members of the Bank in accordance with rules adopted by the Administrative Council.’’ See also ICSID Administrative and Financial Regulations, Regulation 18(1).

¹⁶ Id, Article 24(1).

¹⁷ Schreuer, supra note 8, p. 125.

¹⁸ Ignacio D’Alessio, A Comment on ICSID’s Jurisdictional Issues, University of Amsterdam, June 2008, p. 39, LL.M. paper. The consequences (as between traditional capital exporting countries and capital importing countries) are noticed in a short paper by Florian Grisel, International Development and Investment Arbitration: Allies or Enemies? LASIL, Perspectives - 04/08.

¹⁹ Ćeskoslovenska obchodní banka, a.s. v.Slovak Republic, ICSID Case No.ARB/97/4, Decision of the Tribunal on Objections to Jurisdiction, 24 May 1999 (‘‘CSOB v. Slovak Republic’’), para. 64.

²⁰ See Malaysian Historical Salvors Sdn., Bhd. v. The Government of Malaysia, ICSID Case No. ARB/05/10, Award on Jurisdiction, 17 May 2007 (‘‘Award’’), para. 66.

²¹ Patrick Mitchell v. DRC, para. 30. The case was criticised in Emmanuel Gaillard, A Black Year: ICSID at Crossroads After Troubling Trend, International Arbitration Law News, NYLJ, 1 March 2007, p. 3. As recognised in the article, Mr. Gaillard represented Mr. Mitchell.

²² Biwater Gauff (Tanzania) Limited v. United Republic of Tanzania, ICSID Case No. ARB/05/22, Award, 24 July 2008 (‘‘Biwater v. Tanzania’’), paras. 233(e)–240.

²³ See id.

²⁴ Pey Casado v. Chile, para. 232, translation of the original text by the Committee Member.

²⁵ Id., translation of the original text by the Committee Member.

²⁶ Applicant’s Reply, para. 20.

²⁷ Schreuer, supra note 8; see also discussion at para. 15 above.

²⁸ Patrick Mitchell v. DRC, para.30.

²⁹ Id.

³⁰ See generally Bin Cheng, General Principles of Law as Applied by International Courts and Tribunals, pp. 122, 133 (1987).

³¹ Joy Mining Machinery Limited v. Arab Republic of Egypt, ICSID Case No. ARB/03/11, Award on Jurisdiction, 6 August 2004 (‘‘Joy Mining v. Egypt’’), paras. 49, 53.

³² Consortium Groupement L.E.S.I. - DIPENTA v. People’s Democratic Republic of Algeria, ICSID Case No. ARB/03/8, Award, 10 January 2005, (‘‘L.E.S.I. – DIPENTA v. Algeria’’), Section II, para. 14(i)–(ii).

³³ Bayindir Insaat Turizm Ticaret Ve Sanayi A.S. v. Islamic Republic of Pakistan, ICSID Case No. ARB/03/29, Decision on Jurisdiction, 14 November 2005 (‘‘Bayindir v. Pakistan’’), para. 137. See also Franz Volk v. S.P.R.L. Ets J. Vervaecke, 9 July 1969, 1969 European Court 00295, holding, on a question whether a trade agreement is capable of affecting trade contrary to a certain prohibition, that ‘‘regard must be had to the proportion of the market which the grantor controls or endeavours to obtain’’ and that ‘‘an agreement falls outside the prohibition . . . when it has only an insignificant effect on the markets.’’ And see the review in Maija Laurila, The de minimis Doctrine in EEC Competition Law: Agreements of Minor Importance, E.C.L.R. 1993, 14(3), 97–104.

³⁴ Joy Mining v. Egypt, para. 49.

³⁵ Schreuer, supra note 8, pp. 90–91.

³⁶ Patrick Mitchell v. DRC, para. 31.

³⁷ Joy Mining v. Egypt, para. 50.

³⁸ See Hussein Nuaman Soufraki v. United Arab Emirates, ICSID Case No. ARB/02/7, Decision on the Application for the Annulment of the Award, 5 June 2007 (‘‘Soufraki v. UAE’’), para. 118: ‘‘[t]he ad hoc Committee sees no reason why the rule that an excess of power must be manifest in order to be annullable should be disregarded when the question under discussion is a jurisdictional one.’’ See also the ad hoc Committee’s ruling in Industria Nacional de Alimentos, S.A. and Indalsa Perú, S.A. (formerly Empresas Lucchetti, S.A. and Lucchetti Perú, S.A.) v. Republic of Peru, ICSID Case No. ARB/03/4, Decision on Annulment, 5 September 2007 (‘‘Lucchetti v. Perú’’), para. 101.

³⁹ See Schreuer, supra note 8, p. 934.

⁴⁰ Wena Hotels Limited v. Arab Republic of Egypt, ICSID Case No. ARB/98/4, Decision on Application for Annulment, 5 February 2002 (‘‘Wena Hotels v. Egypt’’), para. 25; see also Repsol v. Ecuador, infra note 44.

⁴¹ See the position as it later came to be set out in Arbitral Award of 31 July 1989, ICJ Reports 1991, 53, at paras. 47, 56, 60.

⁴² MTD Equity Sdn. Bhd.&MTD Chile S.A. v. Chile, ICSID Case No ARB/01/7, Decision on the Application for Annulment, 21 March 2007 (‘‘MTD v. Chile’’), para. 47.

⁴³ Repsol YPF Ecuador S.A. v. Empresa Estatal Petróleos del Ecuador (Petroecuador), ICSID Case No. ARB/01/10, Decision on the Application for Annulment, 8 January 2007 (‘‘Repsol v. Ecuador’’), para. 36, citing Schreuer, p. 933. See also Carlos Ignacio Suarez Anzorena, Vivendi v. Argentina: on the Admissibility of Requests for Partial Annulment and the Ground of a Manifest Excess of Powers, in Annulment of ICSID Awards, Gen. Ed. Emmanuel Gaillard (New York, 2004), 123 at 172.

⁴⁴ CMS Gas Transmission Company v. Argentine Republic, ICSID Case No. ARB/01/8, Decision of the ad hoc Committee on the Application for Annulment of the Argentine Republic, 25 September 2007 (‘‘CMS v. Argentine Republic’’), paras. 128–136.

⁴⁵ CMS v. Argentine Republic, para. 136.

⁴⁶ Id. In paragraph 130, the annulment Committee found that ‘‘the Tribunal made a manifest error of law,’’ but it obviously did not consider that this was the same thing as saying that the Tribunal ‘‘manifestly exceeded its powers’’ within the meaning of Article 52(1)(b) of the ICSID Convention.

⁴⁷ Amco v. Indonesia, para. 22.

⁴⁸ Claimant’s Memorial, p. 7, footnote 32.

⁴⁹ The fact that some traditional capital importing countries are now, to an extent, capital exporting ones is scarcely relevant. On this phenomenon, see Florian Grisel, International Development and Investment Arbitration: Allies or Enemies? LASIL, Perspectives, April 2008.

⁵⁰ Farouk Yala, The Notion of ‘Investment’ in ICSID Case Law: A Drifting Jurisdictional Requirement? Journal of International Arbitration 22(2) (2005), 105–126, at 125.

⁵¹ See, e.g., the interesting article by Yulia Andreeva, Salvaging or Sinking the Investment? MHS v. Malaysia Revisited, The Law and Practice of International Courts and Tribunals, 7 (2008) 161–175.

¹ Emphasis added by the Tribunal.

² Claimant’s Counter-Memorial on Jurisdiction, § 48.

³ Emphasis in the letter.

⁴ Transcript of the Hearing p. 35, lines 1–25 and p. 36, lines 1–14.

⁵ Claimant’s Memorial, p. 4.

⁶ This was a complex operation described as such in the Claimant’s Memorial: ‘‘As part of the overall purchase of C&C and DSB, Mr. Vladimir Beňo, chairman of BG at the time, executed five contracts on BG’s behalf. The agreements were a contract for the sale of the shares of C&C by Mr. Raška to BG, a contract for the sale of the shares of DSB by Mr. Raška to BG, an agreement for the loan of CZK 80 million by BG to C&C, a security contract between BG and DSB securing the loan with DSB’s real estate, and an oral contract between BG and Mr. Raška by which Mr. Raška personally agreed to provide CZK 14 million security for the CZK 80 million loan. The share-sale contracts provided Mr. Raška with the option to repurchase the C&C and DSB shares if the CZK 80 million loan was repaid by January 30, 2001 ... The loan was not repaid, and so BG retained ownership of the companies . . . ’’, pp. 4–5.

⁷ Whose bankruptcy had been declared by a Czech court on August 13, 1997.

⁸ According to the Claimant’s Memorial, ‘‘(i)t was understood by the parties to the various agreements that the CZK 80 million loan was to be the down payment paid at the time of C&C’s final and binding bid for CKD Blansko. C&C submitted its final bid for CZK 191 million on November 27, 2000, and the CZK 80 million down payment was paid. This bid was selected by the CKD Blansko bankruptcy trustee as the winning bid. Following negotiations between representatives of C&C and the bankruptcy trustee, a contract for the purchase of CKD Blansko by C&C was concluded on December 29, 2000. The contract, which was signed by Mr. Beňo and Mr. Raška on behalf of C&C, called for full payment of the additional CZK 111 million by C&C by April 30, 2001, at the latest. If C&C failed to make full payment by that date, the contract would be considered null and void and C&C would lose the CZK 80 million down payment.’’ p. 5.

⁹ Request for Arbitration, § 35.

¹⁰ Claimant’s Memorial, p. 13.

¹¹ Respondent’s Memorial on Jurisdiction, § 3.

¹² Respondent’s Memorial on Jurisdiction. Emphasis in the original.

¹³ Respondent’s Memorial on Jurisdiction, § 13. See also, § 112 : ‘‘The sole reason for Phoenix’s purported investment – indeed, perhaps its incorporation – was to subject the domestic litigation in which the Czech companies were involved to review by an international judicial body by manufacturing artificial involvement of an Israeli investor that would raise claims under the BIT. Such conduct is widely condemned in the international law community.’’

¹⁴ Respondent’s Memorial on Jurisdiction, § 118.

¹⁵ Respondent’s Memorial on Jurisdiction, § 60.

¹⁶ Respondent’s Memorial on Jurisdiction, § 72.

¹⁷ Respondent’s Memorial on Jurisdiction, § 89. The citation is from Dr. Walid Ben Hamida, Observations by Dr. Walid Ben Hamida, Stockholm Int’l Arb. Rev, vol. 2005:2, p. 84.

¹⁸ This routinely designates in ICSID case law certain criteria set forth in the now seminal case Salini Costruttori S.p.A. and Italstrade S.p.A. v. Morocco, ICSID Case No. ARB/00/4, (Italy/Morocco BIT), Decision on Jurisdiction, July 23, 2001.

¹⁹ Respondent’s Reply on Jurisdiction, § 6. Emphasis by the Respondent.

²⁰ Respondent’s Reply on Jurisdiction, § 144.

²¹ Transcript of the Hearing, p. 11, lines 17–20.

²² Transcript of the Hearing, p. 19, lines 6–13.

²³ Claimant’s Rejoinder on Jurisdiction, § 29.

²⁴ Claimant’s Rejoinder on Jurisdiction, § 29.

²⁵ Claimant’s Counter-Memorial on Jurisdiction, § 74. Footnote omitted, emphasis in the original.

²⁶ Claimant’s Counter-Memorial on Jurisdiction, § 5. Emphasis added by the Tribunal.

²⁷ Claimant’s Rejoinder on Jurisdiction, § 72.

²⁸ In Claimant’s Memorial, it is stated that Respondent’s handling, through its courts, of the ownership disputes demonstrates at least two of three types of judicial denial of justice: ‘‘unreasonable delay’’ and either ‘‘pretense of form’’ or ‘‘gross incompetence’’, p. 24.

²⁹ Claimant’s Counter-Memorial on Jurisdiction, § 9.

³⁰ Claimant’s Counter-Memorial on Jurisdiction, § 22.

³¹ Claimant’s Rejoinder on Jurisdiction, § 33. See also, § 41: ‘‘Even if the Salini factors should be used in evaluating the full ownership of two host-state companies, application of those factors establishes that Phoenix Action’s ownership of BP and BG constituted an investment for purposes of the ICSID Convention.’’

³² Claimant’s Counter-Memorial on Jurisdiction, § 64.

³³ MTD Equity Sdn. Bhd. and MTD Chile S.A. v. Republic of Chile, ICSID Case No. ARB/01/7, Award, May 25, 2004; Compañia del Desarrollo de Santa Elena S.A. v. Republic of Costa Rica, ICSID Case No. ARB/96/1, Award, February 17, 2000.

³⁴ Question of Professor Juan Fernández-Armesto, Transcript of the Hearing, p. 171, lines 20–22.

³⁵ Transcript of the Hearing, p. 176, lines 16–20.

³⁶ Claimant’s Counter-Memorial on Jurisdiction, § 28.

³⁷ Claimant’s Rejoinder on Jurisdiction, § 8.

³⁸ Claimant’s Rejoinder on Jurisdiction, § 16.

³⁹ Respondent’s Reply on Jurisdiction, § 23.

⁴⁰ Saipem v. Bangladesh, ICSID Case No. ARB/05/07, Decision on Jurisdiction and Recommendation on Provisional Measures, March 21, 2007, § 91. See also for the same approach, Industria Nacional de Alimentos, S.A. and Indalsa Perú, S.A. v. The Republic of Peru, ICSID Case No. ARB/03/4, Decision on Annulment, September 5, 2007, §§ 118–119.

⁴¹ See also, Bayindir Insaat Turizm Ticaret Ve Sanayi A.S. v. Islamic Republic of Pakistan, ICSID Case No. ARB/03/29, where the tribunal articulated the relevant prima facie standard at the jurisdictional stage of the proceeding: ‘‘The Tribunal should be satisfied that, if the facts or the contentions alleged by [the claimant] are ultimately proven true, they would be capable of constituting a violation of the BIT.’’, Decision on Jurisdiction, November 14, 2005, § 194.

⁴² Inceysa Vallisoletana, S.L. v. Republic of El Salvador, ICSID Case No. ARB/03/26, Award, August 2, 2006, § 155. See also what Sir Franklin Berman QC stated in his dissenting opinion in the case Industria Nacional de Alimentos, called the ‘‘Lucchetti’’ case: ‘‘Factual matters can or should be provisionally accepted at the preliminary phase, because there will be a full opportunity to put them to the test definitively later on. But if particular facts are a critical element in the establishment of jurisdiction itself, so that the decision to accept or to deny jurisdiction disposes of them once and for all for this purpose, how can it be seriously claimed that those facts should be assumed rather than proved?’’, Industria Nacional de Alimentos, S.A. and Indalsa Perú, S.A. v. The Republic of Peru, ICSID Case No. ARB/03/4, Decision on Annulment, Dissenting Opinion of Franklin Berman QC, September 5, 2007, § 17.

⁴³ Gami Inv., Inc. v. The Government of the United Mexican States, UNCITRAL-NAFTA, Final Award, November 15, 2004, § 93, available at www.investmentclaims.com.

⁴⁴ Interestingly, a similar question was raised in a recent UNCITRAL case, Société Générale v. Dominican Republic, (hereafter Société Générale), UNCITRAL, LCIA Case No. UN7927 (France-Dominican Republic BIT), Preliminary Objections to Jurisdiction, September 19, 2008. This case arose after the parties had made their submissions, and for this reason, the Tribunal does not rely on it for its decision, but it considers interesting to point to the convergence of the reasoning in that case with the one adopted in this Award by the Tribunal. In this case, the French bank Société Générale bought some shares, later claimed as being a protected investment under the Agreement between the Government of the French Republic and the Government of the Dominican Republic on the Reciprocal Promotion and Protection of Investments (hereafter ‘‘the treaty’’), which entered into force on January 23, 2003. Société Générale acquired its investment on November 12, 2004. The French bank’s argument was that its rights were protected as from when the acts and events took place, even if it was before the treaty entered into force or it had acquired the investment as a French national. The Respondent, the Dominican Republic, on the contrary, contended that the treaty applied only in respect of French investors and that the Claimant could not claim for acts which took place before the date it became an investor, as there was then no bond of nationality. The decision of the tribunal was unambiguous:

⁴⁵ Malaysian Historical Salvors Sdn, Bhd v. Malaysia, ICSID Case No. ARB/05/10, Award, May 28, 2007, § 55.

⁴⁶ Emphasis added.

⁴⁷ Jost Pauwelyn, ‘‘Role of Public International Law in the WTO Law’’, 95, AJIL, 2001, 539.

⁴⁸ Appellate Body Report: United States – Standards for Reformulated and Conventional Gasoline, WT/DS2/AB/R,29 April 1996, p. 18. See also, Jost Pauwelyn, ‘‘Role of Public International Law in the WTO Law’’, 95, AJIL, 2001, 539: ‘‘States in their treaty relations, can contract out of one, more or in theory, all rules of general international law (other than those of jus cogens), but they cannot contract out of the system of international law. As soon as States contract with one another, they do so automatically and necessarily within the system of international law.’’

⁴⁹ Claimant’s Counter-Memorial on Jurisdiction, § 23.

⁵⁰ See this Award, § 50.

⁵¹ Respondent’s Reply on Jurisdiction, § 52.

⁵² See this Award, § 39.

⁵³ Transcript of the Hearing, p. 129, lines 1–4.

⁵⁴ See Salini Costruttori S.p.A. and Italstrade S.p.A. v. Kingdom of Morocco, ICSID Case No. ARB/00/4, Decision on Jurisdiction, July 23, 2001 § 52. Notes omitted. See also Joy Mining Machinery Limited v. The Arab Republic of Egypt, ICSID Case No. ARB/03/11, Decision on Jurisdiction, July 23, 2001, § 53; Jan de Nul N.V. v. Arab Republic of Egypt, ICSID Case No. ARB/04/13, Decision on Jurisdiction, June 16, 2006, § 91; Helnan International Hotels A/S v. The Arab Republic of Egypt, ICSID Case No. ARB/05/19, Decision on Objection to Jurisdiction, October 17, 2006, § 77; Malaysian Historical Salvors SDN, BHD v. The Government of Malaysia, ICSID Case No. ARB/05/10, Award on Jurisdiction, May 17, 2007, §§ 73-74.

⁵⁵ Jan de Nul N.V. v. Arab Republic of Egypt, ICSID Case No. ARB/04/13, Decision on Jurisdiction, June 16, 2006, § 91. See also, as advocating an even more flexible approach, Biwater Gauff (Tanzania) Ltd. v. United Republic of Tanzania, ICSID Case No. ARB/05/22 (UK/Tanzania BIT), § 316: ‘‘The Arbitral Tribunal therefore considers that a more flexible and pragmatic approach to the meaning of ‘‘investment’’ is appropriate, which takes into account the features identified in Salini , but along with all the circumstances of the case, including the nature of the instrument containing the relevant consent to ICSID.’’ Emphasis in the original.

⁵⁶ The ad hoc Annulment Committee in Mitchell, for example, stated: ‘‘The ad hoc Committee wishes . . . to specify that, in its view, the existence of a contribution to the economic development of the host State as an essential – although not sufficient – characteristic or unquestionable criterion of the investment, does not mean that this contribution must always be sizable or successful; and, of course, ICSID tribunals do not have to evaluate the real contribution of the operation in question. It suffices for the operation to contribute in one way or another to the economic development of the host State, and this concept of economic development is, in any event, extremely broad and also variable depending on the case.’’, Patrick Mitchell v. The Democratic Republic of Congo, ICSID Case No. ARB/99/7, Decision on the Application for the Annulment of the Award, November 1, 2006, § 33.

⁵⁷ L.E.S.I. S.p.A. et ASTALDI S.p.A. v. Algeria, ICSID Case No. ARB/05/3 (Italy/Algeria BIT), Decision, July 12, 2006 (French), § 73(iv).

⁵⁸ Sedelmayer v. Russian Federation, (Germany/Union of the Soviet Socialist Republics BIT), ad hoc arbitration under the Stockholm Chamber of Commerce arbitration rules, Award, July 7, 1998, § 224.

⁵⁹ International Bank for Reconstruction and Development, Report of the Executive Directors on the ICSID Convention, March 18, 1965 (Report of the Executive Directors), § 12. Emphasis added by the Tribunal.

⁶⁰ Emphasis added by the Tribunal.

⁶¹ Report of the Executive Directors, § 9.

⁶² Banro American Resources, Inc. and Société Aurifére du Kivu et du Maniema, SARL v. Democratic Republic of the Congo, ICSID Case No. ARB/98/7, Award, September 1, 2000.

⁶³ Mihaly International Corporation v. Sri Lanka, ICSID Case No. ARB/00/2 (United States/Sri Lanka BIT), Award, March 15, 2002. 64 Banro, § 5 of Section II.

⁶⁵ Mihaly International Corporation v. Sri Lanka, ICSID Case No. ARB/00/2, Award, March 15, 2002, § 24. Emphasis added.

⁶⁶ Tokios Tokelés v. Ukraine, ICSID Case No. ARB/02/18, Decision on Jurisdiction, April 29, 2004, § 56.

⁶⁷ Of the same opinion, see the tribunal in Biwater Gauff (Tanzania) Ltd. v. United Republic of Tanzania, ICSID Case No. ARB/05/22 (UK/Tanzania BIT), Award, 24 July 2008, § 308: ‘‘ . . . Article 25 has an autonomous meaning which cannot be expanded.’’

⁶⁸ According to Salini, ‘‘this provision refers to the validity of the investment and not to its definition’’. This conclusion is not contradictory with the one reached in this Award, which distinguishes the existence of an investment and the existence of a protected investment. Salini, Decision on Jurisdiction, July 23, 2001 § 46. This is indeed what Salini says in the next sentence: ‘‘More specifically, it seeks to prevent the BIT from protecting investments that should not be protected, particularly because they would be illegal.’’ And then the tribunal did indeed verify that the investment was made ‘‘in conformity with the laws in force at that time.’’

⁶⁹ Plama Consortium Limited v. Bulgaria, ICSID Case No. ARB/03/24 (Energy Charter Treaty), Award, August 27, 2008, §§ 138–139.

⁷⁰ As in the case World Duty Free Company Limited v. The Republic of Kenya, ICSID Case No. ARB/00/7, in which the tribunal stated, at the merits stage (no jurisdictional objection was raised) in § 188 that ‘‘(t)he Claimant is not legally entitled to maintain any of its pleaded claims in these proceedings’’.

⁷¹ In fact the tribunal in Plama implicitly makes the same difference as this Tribunal between an investor and a protected investor, which cannot benefit from the substantive protection of the international treaty, PlamaConsortium Limited v. Bulgaria, ICSID Case No. ARB/03/24, Award, August 27, 2008, §§ 126–130.

⁷² Fraport AG Frankfurt Airport Services Worldwide v. Republic of the Philippines, ICSID Case No. ARB/03/25 (Germany/Philippines BIT), Award, August 16, 2007, § 306. Footnotes omitted, emphasis in the original. The reference to the manner in which domestic law was violated is also clearly an implicit reference to bad faith.

⁷³ Id., § 323.

⁷⁴ A. D’Amato, Good Faith, Encyclopedia of Public International Law, vol. 7, p. 107 (R. Bernhardt, ed. 1984).

⁷⁵ Hersch Lauterpacht, Development of International Law by the International Court, London, 1958, p. 164.

⁷⁶ Amco Asia Corporation et al v. Indonesia, ICSID Case No. ARB/81/1, Decision on Jurisdiction, September 25, 1983, § 14. Italicised in the original, underlined by the Tribunal.

⁷⁷ See § 77 of this Award.

⁷⁸ Inceysa Vallisoletana, S.L. v. Republic of El Salvador, ICSID Case No. ARB/03/26, (hereafter Inceysa), Award, August 2, 2006, § 230.

⁷⁹ In the decision in Inceysa, the tribunal concluded that because the claimant did not act in good faith, it could not be considered as having made its investment in accordance with the laws of El Salvador, as required by the BIT, because the principle of good faith is embedded in all national legal systems. In the decision in Fraport, the tribunal emphasized the fact that the violation of the national law was perpetrated through secret agreements concerning the structuring of the foreign investment, i.e. the tribunal focused primarily on the violation of the national law, but added that the structuring was perpetrated through bad faith behaviour. In other words, in these two instances, the economic activity was not considered as a protected investment, as it violated the principle of good faith as embodied in the domestic legal order.

⁸⁰ Emphasis added. See also a reference to the ‘‘general principles of law which, as indicated, are part of Salvadorian law’’, id., § 243.

⁸¹ Inceysa, § 249.

⁸² Plama Consortium Limited v. Bulgaria, ICSID Case No. ARB/03/24, Award, August 27, 2008, §§ 143–144. Emphasis added In the case World Duty Free, also, it is noticeable that the tribunal has considered the bribe given to the President of the host State in order to obtain a contract to be a violation of both the national and international legal principle. In this case, the tribunal has insisted on the international aspect of the principle, dealt with in priority before examining English and Kenyan law. The tribunal concluded that corruption is contrary to ‘‘an international public policy common to the community of nations.’’, World Duty Free Company Limited v. The Republic of Kenya, ICSID Case No. ARB/00/7, § 148. See also § 157.

⁸³ Claimant’s Counter-Memorial on Jurisdiction, § 11.

⁸⁴ Claimant’s Counter-Memorial on Jurisdiction, note 11.

⁸⁵ As stated by the LCIA tribunal in Société Générale, ‘‘(t)he purchase of property for a nominal price is a normal kind of transaction the world over when there are other interests and risks entailed in the business.’’Société Générale v. Dominican Republic, UNCITRAL, LCIA Case No. UN7927, Preliminary Objections to Jurisdiction, September 19, 2008, § 36.

⁸⁶ Respondent’s Reply on Jurisdiction, § 18.

⁸⁷ Compania de Aguas del Aconquija S.A. and Vivendi Universal v. Argentine Republic, ICSID Case No. ARB/97/3, Decision on Annulment, July 3, 2002, § 50. See also, Asian Agricultural Products, Ltd. v. Republic of Sri Lanka, ICSID Case No. ARB/87/3, Final Award, June 27, 1990, § 3, as to the finding of an investment when claimant was merely ‘‘participating in the equity capital’’ of a host state enterprise; Antoine Goetz v. République du Burundi, ICSID Case No. ARB/95/3, Award, February 10, 1999, § 89, as to the upholding of the right to sue under a BIT not just by a wronged company but by its shareholders, the ‘‘true investors’’; Lanco International v. Argentine Republic, ICSID Case No. ARB/97/6, Decision on Jurisdiction, December 8, 1998, § 10, as to the finding of an investment even though claimant owned just 18.3% of the capital stock of the host state company; CMS Gas Transmission Company v. The Argentine Republic, ICSID Case No. ARB/01/8, Decision on Jurisdiction, July 17, 2003, § 55, noting that tribunals have not ‘‘been concerned . . . with the question of majority or control’’ of a host country enterprise.

⁸⁸ Enron Corporation and Ponderosa Assets, L.P. v. Argentine Republic, ICSID Case No. ARB/01/3 (United States/Argentina BIT), Decision on Jurisdiction, January 14, 2004, § 54.

⁸⁹ Claimant’s Counter-Memorial on Jurisdiction, § 27.

⁹⁰ Respondent’s Memorial on Jurisdiction, § 91.

⁹¹ Respondent’s Memorial on Jurisdiction, § 92.

⁹² See Transcript of the Hearing, p. 121, lines 5–6.

⁹³ Transcript of the Hearing, p. 122, lines 20–24.

⁹⁴ Claimant’s Rejoinder on Jurisdiction, § 51.

⁹⁵ Claimant’s Counter-Memorial on Jurisdiction, § 32. See also, § 33: ‘‘Phoenix Action paid substantial sums for two companies that were in a distressed condition in the hopes that those companies would regain their past profitability.’’

⁹⁶ Claimant’s Rejoinder on Jurisdiction, § 60.

⁹⁷ See for example, Transcript of the Hearing, p. 125, lines 8–11: ‘‘Finally, with respect to the phrase ‘in connection with economic activities‘, the respondent’s breach of the BIT is the cause of BP’s and BG’s continued inability to resume their prior functioning.’’

⁹⁸ Transcript of the Hearing, p. 34, lines 6–11. Emphasis added.

⁹⁹ Transcript of the Hearing, p. 42, line 25 and p. 43, lines 1–8.

¹⁰⁰ Respondent’s Memorial on Jurisdiction, § 34: ‘‘The sole owner of Yugo Alloys is Zuzana Beňová, a Czech citizen; who is believed to have been no more than eighteen-yearsold at the time. Upon information and belief, Miss Beňová is the daughter of Mr. Beňo.’’

¹⁰¹ Claimant’s Rejoinder on Jurisdiction, § 58.

¹⁰² Transcript of the Hearing, p. 178, lines 1–5 and 8–9.

¹⁰³ Transcript of the Hearing, p. 179, lines 7–10 and 15–18.

¹⁰⁴ Request for Arbitration, § 23.

¹⁰⁵ Claimant’s Memorial, p. 3.

¹⁰⁶ Transcript of the Hearing, p. 145, lines 16N19.

¹⁰⁷ Respondent’s Memorial on Jurisdiction, § 87. Emphasis by the Respondent.

¹⁰⁸ Interestingly, this was also forcefully stated by the LCIA Tribunal in the case Société Générale, where it stated that a transaction to acquire an investment always has to be closely analyzed and that there are limits to the application of investment protection treaties: ‘‘One such limit is that the transaction in question must be a bona fide transaction and not devised to allow a national of a State not qualifying for protection to obtain an inappropriate jurisdictional advantage otherwise unavailable by transferring its rights after-the-fact to a qualifying national.’’ Société Générale v. Dominican Republic, UNCITRAL, LCIA Case No. UN7927, Preliminary Objections to Jurisdiction, September 19, 2008, § 110.

¹⁰⁹ Inceysa Vallisoletana, S.L. v. Republic of El Salvador, ICSID Case No. ARB/03/26, Award, August 2, 2006, § 231.

¹¹⁰ Claimant’s Memorial, p. 40.

¹¹¹ Respondent’s Memorial on Jurisdiction, § 147.

¹¹² See in particular Plama Consortium Limited v. Republic of Bulgaria, ICSID Case No. ARB/03/24, Award, August 27, 2008, §§ 307 ff.

¹¹³ The ICSID Secretariat will in due course provide the parties with a financial statement of the case account.