Uruguay seeks to enforce an arbitration award issued in its favor and against Respondent, Italba Corporation ("Respondent" or "Italba"), by a panel convened under the authority of the International Convention on the Settlement of Investment Disputes between States and Nationals of Other States. Mar. 18, 1965, 17 U.S.T. 1270 (the "ICSID Convention"). In the Motion now before the Court, Uruguay asserts that, given the Court's limited role in such matters (discussed below) and the absence of material factual disputes, judgment on the pleadings is appropriate. [ECF No. 15]. Italba opposes the Motion and argues that there are factual disputes that preclude judgment on the pleadings. [ECF No. 18]. Specifically, Italba challenges the authenticity of the award submitted with the Petition and whether Uruguay is entitled to prejudgment interest (and at what rate) and costs.
The ICSID Convention is a multilateral treaty aimed at encouraging and facilitating private foreign investment in developing countries. See Mobil Cerro Negro, Ltd. V. Bolivarian Republic of Venezuela, 863 F.3d 96, 100 (2d Cir. 2017) (citations omitted). To help allay concerns from private investors wary of investing in these countries due to risks of expropriation and other "government measures that might tend to impair the rights or assets of foreign investors[,]" the World Bank created the ICSID Convention which, in turn, established the International Center for Settlement of Investment Disputes ("ICSID") as a neutral dispute settlement forum to adjudicate disputes between international investors and host governments in "Contracting States" – those countries whose governments adopted the Convention. See id. at 101.
The ICSID, which is based in Washington, DC, convenes arbitral tribunals in response to requests made by either a member state or a national of a member state. ICSID Convention arts. 36-37. At the conclusion of their proceedings, the tribunals issue written awards that address "every question submitted to the Tribunal," and "state the reasons upon which [the award] is based." Id. art. 48. The Convention further provides that a party dissatisfied with an award may challenge it on various grounds but may do so only through proceedings at the ICSID and not collaterally in the courts of member states: "The award shall be binding on the parties and shall not be subject to any appeal or to any other remedy except those provided for in this Convention." ICSID Convention art. 53(1) (emphasis added).
The limited role played by the courts of member states is set out in Article 54 of the Convention, which provides:
(1) Each Contracting State shall recognize an award rendered pursuant to this Convention as binding and enforce the pecuniary obligations imposed by the award within its territories as if it were a final judgment of a court in that State. A Contracting State with a federal constitution may enforce such an award in or through its federal courts and may provide that such courts shall treat the award as if it were a final judgment of the courts of a constituent state.
(2) A party seeking recognition or enforcement in the territories of a Contracting State shall furnish to a competent court or other authority which such State shall have designated for this purpose a copy of the award certified by the Secretary-General. Each Contracting State shall notify the Secretary-General of the designation of the competent court or other authority for this purpose and of any subsequent change in such designation.
(3) Execution of the award shall be governed by the laws concerning the execution of judgments in force in the State in whose territories such execution is sought.
Id. art. 54. Thus, member states' courts agree to "recognize" ICSID awards "as binding" and to "enforce the pecuniary obligations imposed by the award...." Id.; see also Mobil, 863 F.3d at 101-102.
Member states' courts are thus not permitted to examine an ICSID award's merits, its compliance with international law, or the ICSID tribunal's jurisdiction to render the award; under the Convention's terms, they may do no more than examine the judgment's authenticity and enforce the obligations imposed by the award. Thus, the Convention reflects an expectation that the courts of a member nation will treat the award as final.
Mobil, 863 F.3d at 102 (citing Christopher H. Schreuer, et al., The ICSID Convention: A Commentary 1270 (2d ed. 2009) at 1139-41 (describing principle of finality of awards and reporting that principle was the subject of "extensive discussion").
The ICSID is not self-executing. Therefore, when the United States ratified the ICSID Convention in 1966, it adopted legislation to implement its provisions. 22 U.S.C. § 1650a. Section 1650a provides:
An award of an arbitral tribunal rendered pursuant to chapter IV of the convention shall create a right arising under a treaty of the United States. The pecuniary obligations imposed by such an award shall be enforced and shall be given the same full faith and credit as if the award were a final judgment of a court of general jurisdiction of one of the several States. The Federal Arbitration Act (9 U.S.C. 1 et seq.) shall not apply to enforcement of awards rendered pursuant to the convention.
22 U.S.C. § 1650a(a). Under Section 1650a(b), (t)he district courts of the United States ... shall have exclusive jurisdiction over actions and proceedings under subsection (a) of this section, regardless of the amount in controversy. 22 U.S.C. 1650a(b). In Mobil, supra, the Second Circuit engaged in a thorough analysis of the ICSID and its enabling statute in the context of determining the type of proceeding that must be brought to enforce awards in United States Courts.1 The Second Circuit described the ICSID enforcement action as "plenary" or "summary" and not a proceeding "in which the court must entertain all manner of substantive defenses, or even defenses cognizable under the Federal Arbitration Act. Id. at 117. The Second Circuit further explained the nature of the litigation on actions to enforce ICSID awards as follows:
Used in this context, the word "plenary" signals merely the need for commencing an action under Federal Rule of Civil Procedure 3, service of the complaint in compliance with Rule 4 , and the opportunity for the defendant  to appear and file responsive pleadings. To initiate such an action, an ICSID award-creditor may file a complaint in district court, detailing the terms of the award, establishing proper venue, and furnishing a certified copy of the award. After the complaint is filed and service effected, the award-creditor may file a motion for judgment on the pleadings, for instance, or a motion for summary judgment. The ICSID award-debtor would be a party to the action and would be able to challenge the United States court's jurisdiction to enforce the award – for instance, on venue grounds – but would not be permitted to make substantive challenges to the award.
Id. at 117-118.
At bottom, the Court's role in actions brought pursuant to Section 1650a to enforce ICSID awards is very limited. This Court will not examine the award's merits, its compliance with international law, or the ICSID tribunal's jurisdiction to render the award. However, although the Court's role in enforcing an ICSID arbitral award is exceptionally limited, the Court is more than a "rubber stamp." Id. at 112; see also Teco Guat. Holdings, LLC v. Republic of Guatemala, 414 F. Supp. 3d 94, 101 (D.D.C. 2019) (citing Micula v. Gov't of Rom., 104 F. Supp. 3d 42, 50-51 (D.D.C. 2015)). The Court must ensure that it has subject-matter and personal jurisdiction, must ensure that the award is authentic, and must ensure that its enforcement order is consistent with the award. Id. (internal citations omitted).
Petitioner, the Oriental Republic of Uruguay, brought this action on December 6, 2021, to confirm and enforce a final arbitration award issued on March 22, 2019 (the "Award") in its favor and against Respondent, Italba. [ECF No. 1 at ¶ 1]. The Award was rendered in Italba Corporation v. Oriental Republic of Uruguay, ICSID Case No. ARB/16/9 (the "Arbitration"), following an arbitration submitted by Italba to the ICSID under the Treaty Between the United States of America and the Oriental Republic of Uruguay Concerning the Encouragement and Reciprocal Protection of Investment (the "Treaty"). Id. at ¶ 2. In a lengthy, detailed written Award and decision, the Tribunal determined that it lacked jurisdiction to settle the dispute. Id. The Tribunal also addressed both parties' claims of entitlement to an award of the costs of the proceedings and to interest on any costs awarded. Id. at 81-83.
Accordingly, it is hereby
ORDERED and ADJUDGED that
1. Petitioner's Motion for Judgment on the Pleadings [ECF No. 15] is GRANTED IN PART and DENIED IN PART;
2. The pecuniary obligations in the Award in Italba Corporation v. Oriental Republic of Uruguay, ICSID Case No. ARB/16/9 in favor of Petitioner, Oriental Republic of Uruguay, and against Respondent, Italba Corporation, shall be RECOGNIZED and ENTERED as a JUDGMENT by the Clerk of this Court in the same manner and with the same force and effect as if the Award were a final judgment of this Court, as authorized by 22 U.S.C. § 1650a and Article 54 of the ICSID Convention;
3. In accordance with the pecuniary obligations contained in the Award, Italba Corporation shall pay the Oriental Republic of Uruguay the amount of $5,885,344.17 plus post-judgment interest, as provided in Title 28, United States Code, Section 1961, and costs as provided in Federal Rule of Civil Procedure 54(d)(1);
4. Petitioner's claim for prejudgment interest is DENIED; and
5. The Clerk of the Court is hereby directed to enter judgment in accordance with this Order, deny all pending motions as moot, and close this case.
DONE AND ORDERED in Chambers at Miami, Florida this 7th day of June, 2022.
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