Investor-State Arbitration

Effectively resolving international disputes in the interest of our clients has been a hallmark of Steptoe’s practice for more than half a century.  Our worldwide Arbitration & Dispute Resolution Group brings together the firm’s established practices in public international law, cross-border litigation, international commercial arbitration, and investor-state disputes.  Steptoe lawyers act as counsel and advisors, serving our clients’ interests wherever in the world they are engaged, and wherever on the dispute spectrum they lie, be it negotiation, mediation, arbitration, or litigation.  In addition, Steptoe lawyers have also served as arbitrators and hold academic appointments in international commercial and investor-state arbitration at leading law schools across the globe.

Our arbitration practice includes:

Steptoe’s Investor-State Arbitration Advisory Series

For an introduction to investor-state arbitration and how the treaties that give rise to them can be a useful tool for minimising political risk, please see our advisory on this subject. That advisory is part of Steptoe’s Investor-State Arbitration Advisory Series, which outlines key aspects of the investor-state arbitral process and the rights and defences that are frequently raised in this context. If you would like to receive advisories in this series by email as soon as they are published, please click here.

Representative Matters

Investor-State Arbitrations

Steptoe lawyers have a broad range of experience in representing both corporations and the governments of states in investor-state arbitrations. By way of illustration of Steptoe’s recent experience in investor-state arbitration, we have or are:

  • Represented Motorola in an ICSID arbitration against Turkey that resulted in payments to Motorola of approximately US$1 billion: Motorola Credit Corporation Inc. v Turkey (ICSID Case No. ARB/04/21).
  • Represented the investor in an ICSID Additional Facility arbitration against Mexico arising from the application of a discriminatory tax: Corn Products International Inc. v Mexico (ICSID Case No. ARB (AF)/04/1).  When rendered, the US$58 million (after tax) award was the largest rendered in a NAFTA Chapter 11 investment dispute.
  • Represented investors in Funnekotter & Ors v Zimbabwe, (ICSID Case No. ARB/05/6), which was the first ICSID case involving multiple, unrelated parties.  The award was in favour of the investors.
  • Represented investors in respect of an investment dispute at ICSID arising from alleged breaches of a bilateral investment treaty: Trans-Global Petroleum Inc. v Jordan (ICSID Case No. ARB/07/25).  The parties settled the case by a consent award.
  • Representing investors in Border Timbers Ltd & Ors v Zimbabwe (ICSID Case No. ARB/10/25) and von Pezold & Ors v Zimbabwe (ICSID Case No. ARB/10/15).  The awards in both cases are pending.
  • Representing an Italian investor on a claim to be brought in respect of an investment in the agriculture sector in an African state.
  • Representing a UK investor on a claim to be brought in respect of an upstream oil and gas project against an East European state.
  • Represented a Canadian investor in relation to a multi-billion dollar investment dispute with the United States under the NAFTA.  Part of a broad litigation strategy encompassing other Steptoe teams.  Dispute resolved in our client’s favor.
  • Represented Exxon Mobil in connection with pre-award attachment actions in various jurisdictions relating to ICC and ICSID arbitration proceedings against the Republic of Venezuela and its state-owned oil company, PDVSA.
  • Advised the Government of Canada in relation to its defence of a claim brought under the NAFTA by the United Parcel Service of America: United Parcel Service of America v The Government of Canada (UNCITRAL).  The Canadian Government was successful in defending UPS’s claims, which were for damages of over US$160 million, in their entirety.
  • Advised the Government of Canada in relation to its defence of a claim brought under the NAFTA by Chemtura Corporation: Chemtura Corporation v The Government of Canada (UNCITRAL).  The tribunal dismissed all of Chemtura Corporation’s claims.
  • Appointed by the Government of the People’s Republic of China to the panel of law firms that will be instructed to defend it in investor-state disputes.

Moreover, Steptoe’s practice in this field dates back to the 1970s when the firm represented several major oil companies in the arbitration of expropriation claims against the Libyan Government.  Our experience continued to grow in the early 1980s when we represented a broad range of US companies in investment claims against the Iranian Government before the Iran-US Claims Tribunal in The Hague.  This includes having successfully represented a consortium of US oil companies in a series of international arbitrations involving the largest private claims presented to the Tribunal.  Additionally, Steptoe lawyers have represented the US Government in more than 130 arbitrations against the Government of Iran before the Tribunal, totaling more than US$30 billion in claims.  (For further information, see our capabilities in Public International Law.)

Our lawyers have conducted arbitrations, in whole or in part, in Spanish, Portuguese, French, Russian, and Mandarin Chinese, and are capable of handling arbitrations in a number of other languages.

Advisory Work (Pre-Dispute)

In addition to acting as counsel in investor-state arbitrations, Steptoe also advises clients on the structuring of their international investments so as to ensure that any disputes with the host country will be subject to international arbitration under a BIT or other applicable treaty.  

We have also advised clients on the scope of their treaty protection at the pre-dispute stage.  For example, we have:

  • Advised a leading US multinational on sovereignty over subsurface mineral deposits in a concession jointly administered by two sovereign states in the Middle East
  • Advised clients on the implications of the dissolution of the former Soviet Union for pre-existing commercial relationships and investments in light of the international law applicable to succession of states
  • Advised clients regarding the substantive and procedural guarantees provided by the Energy Charter Treaty, including the expropriation of concessions and energy transit rights

Steptoe’s work in this field also includes advising governments on their investment treaty programs and negotiations. In particular, we have been engaged by several states to advise on their investment treaty negotiations, including (most recently) negotiations with the European Union. In addition, Steptoe works closely with the Rule of Law Committee and the Private International Law Committee of the US State Department to formulate the terms of standard US BITs so as to best protect US investors in their investments in other countries.

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