Overview
(August 29, 2017, London) — Steptoe has secured another success at the International Centre for Settlement of Investment Disputes (ICSID) for the von Pezold family in its long-running dispute against the government of Zimbabwe over its racially discriminatory land reform program.
In July 2015, Steptoe successfully concluded two investment treaty arbitrations against Zimbabwe that had been running at the ICSID since 2010. The cases were commenced pursuant to the bilateral investment treaties that Zimbabwe had concluded with Germany and Switzerland.
In what were described by The Times of London as “landmark” awards, the ICSID tribunals concluded that Zimbabwe’s land reform program was discriminatory and held that it, together with the foreign exchange policy, breached public international law. The tribunals awarded the return of property (a first for an ICSID tribunal), and, in the alternative, damages of $195 million and $125 million respectively for the two cases. The damages awarded were among the highest ever awarded by an ICSID tribunal and represent about 80 percent of the damages claimed, which is a very high ratio for ICSID arbitrations.
In October 2015, the government of Zimbabwe moved to annul the awards, which automatically granted a provisional stay of enforcement. However, in identical decisions of April 24, 2017, the ICSID committees in the von Pezold and Border cases lifted the provisional stay finding that Zimbabwe had failed to establish that the circumstances of the case require a stay of enforcement. The committees also ordered that Zimbabwe had until July 23, which was 90 days from the dispatch of the April 24 decisions, to restitute the properties as per the awards of July 2015, or pay full compensation by August 22. Zimbabwe applied to extend the restitution window beyond July 23, but on August 22, the committees rejected the request.
Zimbabwe is now in breach of the awards. As of August 23, the following sums are due under the awards: US $230,299,743.25; GBP 8,278,430.96 plus ZAR 705,640.02 (inclusive of pre- and post-award interest as of August 23; post-award interest continues to accrue).
The cases arose out of Zimbabwe’s widely reported land reform program and foreign exchange policy which resulted in the expropriation of the farms of 4,500 people (including those of Steptoe’s Swiss and German clients) because of the color of their skin and the taking of foreign exchange.
The London-based Steptoe team representing the von Pezold family in this arbitration is led by partner Matthew Coleman with associates Helen Aldridge and Tom Innes.
Read the full April 2017 decisions here and here and the August 2017 decision here.
About Steptoe
Steptoe & Johnson LLP is an international law firm widely recognized for vigorous advocacy in complex litigation and arbitration, successful representation of clients before governmental agencies, and creative and practical advice in guiding business transactions. The firm has more than 500 lawyers and other professionals in offices in Beijing, Brussels, Chicago, London, Los Angeles, New York, Phoenix, San Francisco, and Washington. For more information, visit www.steptoe.com.
