Accession Treaty | Accession Treaty of 2003 between Poland and the Member States of the European Union signed on 16 April 2003 |
Achmea | Case C-284/16 Slowakische Republik v Achmea BV before the CJEU |
Achmea Declaration | Declaration of the Representatives of the Governments of the Member States of 15 January 2019 on the legal consequences of the Judgment of the Court of Justice in Achmea |
Achmea Judgment | CJEU's judgment in Achmea, issued on 6 March 2018 |
Achmea Opinion | Opinion of Advocate-General Wathelet on the questions before the CJEU in Achmea, dated 19 September 2017 |
Answer | Claimants' Answer to the Request for Arbitration, dated 10 November 2014 |
Annulment Decision | Decision of the Self-Government Appeal Council in Warsaw, dated 10 December 2003, annulling the Enfranchisement Decision |
Bank Guarantee | Bank guarantee of EUR [REDACTED] obtained by Strabag in favour of the City of Warsaw as beneficiary to secure the investment obligation under the SPA |
Board Declaration | Statement of Syrena Hotel's Management Board, dated 17 March 1997 |
C-[#] | Claimants' Exhibit [#] |
CETA | Comprehensive Economic and Trade Agreement between Canada and the EU |
CETA Opinion | Opinion of Advocate General Bot, dated 29 January 2019, in CJEU Case 1/17 |
CJEU | European Court of Justice |
CL-[#] | Claimants' Legal Authority [#] |
C-PHB | Claimants' Post-Hearing Brief |
C-RPHB | Claimants' Reply Post-Hearing Brief |
Claimants | (1) Strabag SE, (2) Raiffeisen Centrobank AG and (3) Syrena Immobilien Holding AG |
Commission | European Commission |
Christmas Decision | Decision No. 610/GK/DW/ 2012 issued by the City of Warsaw concerning Plot Nos 1582 J and 6688 on 24 December 2012, declaring [REDACTED] the legal owner of Hotel Polonia and granting her the right of perpetual usufruct for 99 years over the land |
Declarations | The Achmea Declaration and two other interpretative Declarations dated 16 January 2019, one signed by five other EU Member States, and the other by Hungary |
Division Proceedings | Proceeding initiated ex officio by the City of Warsaw concerning the division of land with Register No. WA4M/00143520/0 |
Enfranchisement Decision | Decision No. 489/93, dated 29 June 1993, by which the Board of the Union of Districts of Warsaw affirmed Syrena Hotels' acquisition of property rights |
EU | European Union |
EU Treaties | The TEU and the TFEU |
Hearing | Oral hearing on jurisdiction held at the World Bank in Paris, France on 7 and 8 June 2017 |
ICSID | International Centre for Settlement of Investment Disputes, the Administering Institution |
ICSID Additional Facility Rules | ICSID Arbitration (Additional Facility) Rules, in force as of April 2006 |
ICSID Convention | 1965 Convention on the Settlement of Investment Disputes Between States and Nationals of Other States |
Information Memorandum | Information Memorandum, dated 15 May 1996, concerning the tender for 80% of the shares in Syrena Hotels |
Jur. CM | Claimants' Jurisdictional Counter-Memorial, dated 7 December 2015 |
Jur. Memorial | Respondent's Jurisdictional Memorial, dated 27 July 2015 |
Jur. Rejoinder | Claimants' Jurisdictional Rejoinder Memorial, dated 7 June 2016 |
Jur. Reply | Respondent's Jurisdictional Reply Memorial, dated 7 March 2016 |
Municipalisation Decision | Decision No. 6817, dated 26 June 1991, by which the Province Governor of the City of Warsaw decided that the City of Warsaw had acquired Syrena Hotels and all its properties |
Notice | Letter from Baier Law Firm (on behalf of the Claimants) to Poland, dated 19 December 2012 |
PCAP | Polish Code of Administrative Procedure |
Poland (or the Respondent) | Republic of Poland |
Privatisation Act of 1990 | Polish Act of 13 July 1990 on the Privatisation of State-Owned Enterprises |
R-[#] | Respondent's Exhibit [#] |
R-PHB | Respondent's Post-Hearing Brief |
R-RPHB | Respondent's Reply Post-Hearing Brief |
Raiffeisen (or Second Claimant) | Raiffeisen Centrobank AG |
Respondent (or Poland) | Republic of Poland |
RL-[#] | Respondent's Legal Authority [#] |
SIHAG (or Third Claimant) | Syrena Immobilien Holding AG |
SIHOL | Syrena Immobilien Holding Limited |
SPA | Share Purchase Agreement between Strabag and the City of Warsaw for 80% of the shares of Syrena Hotels, signed on 18 March 1997 |
Strabag (or First Claimant) | Strabag SE |
Supplement | Supplement to the Information Memorandum, dated 9 October 1996 |
Syrena Hotels | Hotele Warszawakie "Syrena" Sp. z.o.o. |
TEU | Treaty of the European Union |
TFEU | Treaty on the Functioning of the European Union |
Treaty | Agreement between the Republic of Austria and the Polish People's Republic concerning the Encouragement and Protection of Investments of 24 November 1988 |
Tribunal | Arbitral tribunal composed of Mr V.V. Veeder, President, Professor Albert Jan van den Berg, Professor Karl-Heinz Böckstiegel, constituted on 23 December 2014 |
VCLT | Vienna Convention on the Law of Treaties |
Warsaw Decree | Decree of 26 October 1945, issued under the Polish Communist regime, which expropriated properties in Warsaw |
Advocate-General Wathelet | Advocate-General of the CJEU issuing the Achmea Opinion |
Bau Holdings AG | An Austrian joint stock corporation which purchased 80% of the shares in Syrena Hotels in 1997; legal predecessor to Strabag |
Board of the Union of Districts of Warsaw | One of the two executive bodies of the City of Warsaw from 1991 to 1994; issued the Enfranchisement Decision on 29 June 1993, affirming Syrena Hotels' acquisition of property rights |
City of Warsaw | Government body of Warsaw, which owns Plot No 39 and founded Syrena Hotels (called "the Municipality" by the Respondent) |
Deputy Mayor of the City of Warsaw | Heard [REDACTED] claims from 1992 to 1996 and then signed the SPA with Strabag |
[REDACTED] | Owner of Plot No 6203, located next to Hotel Polonia, before the Warsaw Decree |
[REDACTED] | Member of the [REDACTED] family who initiated proceedings to invalidate the Enfranchisement Decision |
Hotele Warszawakie "Syrena" Sp. z.o.o. ("Syrena Hotels") | Polish limited-liability company with the right of perpetual usufruct to Plot No 39, on which Hotel Polonia and Hotel Metropol are located |
Kubas, Andrzej | Claimants' expert witness on Polish Law |
[REDACTED] | Daughter and sole heir of [REDACTED] |
[REDACTED] | Cousin and sole heir of [REDACTED] disputes Syrena Hotels' legal title to Plot No 39 |
Minister of Internal Affairs | Consented to the SPA between Strabag and the City of Warsaw |
Minister of Spatial Development and Construction | Administrative body that considered certain applications to declare Decree Decisions invalid; invalidated the Decree Decisions relating to the [REDACTED] family on 24 March 1993 |
President of the Office of Competition and Consumer Protection | Consented to the SPA between Strabag and the City of Warsaw |
Province Governor of the City of Warsaw | Issued the Municipalisation Decision on 26 June 1991, deciding that the City of Warsaw had acquired Syrena and all its properties |
[REDACTED] | Founder and first owner of Hotel Polonia; father of [REDACTED] |
Raiffeisen Centrobank AG ("Raiffeisen") | Second Claimant, an Austrian joint stock corporation that owns 50% of the shares in SIHAG |
Self-Government Appeal Council | Administrative body that hears appeals against decisions of self-government administrative bodies based in Warsaw |
Simma, Judge Bruno | Claimants' expert on international law (the Parties have agreed to treat his written submission as a submission of the Claimants) |
Strabag SE ("Strabag") | First Claimant, an Austrian company that owns 50% of the shares in SIHAG; legal successor of Bau Holdings AG |
Supreme Administrative Court | The highest administrative court in Poland, which hears appeals against rulings of the province administrative courts |
Syrena Immobilien Holding AG ("SIHAG") | Third Claimant, an Austrian joint stock corporation which, through SIHOL, which owns 85% of the shares in Syrena Hotels |
Syrena Immobilien Holding Limited ("SIHOL") | Cypriot subsidiary of SIHAG, which holds 85% of the shares in Syrena Hotels |
Mr Anton Baier
Mr Erhard Böhm
Mr Gregor Grubhofer
Mr Marko Szucsich
Baier Rechtsanwälte KG
Kärntner Ring 12
1010 Vienna
Austria
baier@baierpartners.com
boehm@baierpartners.com
grubhofer@baierpartners.com
szucsich@baierpartners.com
Tel.: +43 1 515 50 0
Fax: +43 1 515 50 50
Until 18 January 2020
Ms Amelie Huber-Starlinger
Ms Marie-Christine Motaabbed
Baier Rechtsanwälte KG
Kärntner Ring 12
1010 Vienna
Austria
huberstarlinger@baierpartners.com
motaabbed@baierpartners.com
Tel.: +43 1 515 50 0
Fax: +43 1 515 50 50
Mr Maciej Martynski
Ms Anna Mazgajska
Dr Marta Cichomska
Ms. Kamila Lipecka
Ms. Joanna Jackowska-Majeranowska
Ms. Agnieszka Kilanowska
Ms. Anna Kaczyńska
International and European Law Department
Office of the General Counsel
ul. Hoża 76/78
00-682 Warsaw Poland
maciej.martynski@prokuratoria.gov.pl
anna.mazgajska@prokuratoria.gov.pl
marta.cichomska@prokuratoria.gov.pl
kamila.lipecka@prokuratoria.gov.pl
joanna.jackowska-majeranowska@prokuratoria.gov.pl
agnieszka.kilanowska@prokuratoria.gov.pl
anna.kaczynska@prokuratoria.gov.pl
Tel: +48 22 392 32 85
Until 1 October 2017:
Mr Tomasz Wardyński
Mr Paweł Mazur
Mrs Monika Hartung
Mr Piotr Golędzinowski
Mr Stanisław Drozd
Wardyński i Wspólnicy sp.k. Al. Ujazdowskie
1000-478 Warsaw
Poland
tomasz.wardynski@wardynski.com.pl
pawel.mazur@wardynski.com.pl
monika.hartung@wardynski.com.pl
piotr.goledzinowski@wardynski.com.pl
stanislaw.drozd@wardynski.com.pl
Tel.: +48 22 437 82 00, 22 537 82 00
Fax: +48 22 437 82 01, 22 537 82 01
a. Professor Karl-Heinz Böckstiegel, appointed jointly by the Claimants; of Parkstraße 38, D 51427 Bergisch-Gladbach, Germany; Tel: +49 22 046 62 68; Email: kh@khboeckstiegel.com.
b. Professor Albert Jan van den Berg, appointed by the Respondent; of Hanotiau & van den Berg (HVDB), IT Tower, 9th Floor, 480, Avenue Louise, B.9, 1050 Brussels, Belgium Tel: +32 02 290 39 13; Email: ajvandenberg@hvdb.com.
c. Mr V.V. Veeder, appointed by the Party-appointed Arbitrators to act as the President of the Tribunal; of Essex Court Chambers 24 Lincoln's Inn Fields, London WC2A3EG, United Kingdom; Tel: +44 2078138000; Email: vvveeder@londonarbitrators.net.
(1) If disputes should arise between one Contracting State and an investor from the other Contracting Party with regard to an investment, such disputes shall be resolved amicably between the parties themselves if possible. If such amicable resolution is not possible, then the investor shall exhaust all relevant domestic administrative and judicial remedies.
(2) If such a dispute cannot be settled in a manner provided for in paragraph 1 within 12 months from written notification of adequately specified claims, it shall at the request of the Contracting Party or of the investor from the other Contracting Party, be submitted for composition or arbitration: …
(b) to an international arbitral tribunal, if either of the Contracting Parties is not a signatory to the Convention on the Settlement of Investment Disputes between States and nationals of other States. The international arbitral tribunal shall be constituted on an ad hoc basis in the following manner: each side shall appoint an arbitrator, and these arbitrators shall agree on a chairman, who shall be a national of a third State. The arbitrators shall be appointed within two months from the date on which the investors ha[ve] notified the other Contracting Party of his desire to submit the dispute to an arbitral tribunal and the chairman within a further two months....
The international arbitral tribunal shall be constituted on an ad hoc basis in the following manner: each side shall appoint an arbitrator, and these arbitrators shall agree on a chairman, who shall be a national of a third State. The arbitrators shall be appointed within two months from the date on which the investors ha[ve] notified the other Contracting Party of his desire to submit the dispute to an arbitral tribunal and the chairman within further two months.
Tribunal
Mr. V. V. Veeder, President
Professor Karl-Heinz Böckstiegel, Arbitrator
Professor Albert Jan van den Berg, Arbitrator
Secretary of the Tribunal
Ms. Lindsay Gastrell, ICSID Secretariat
Claimants
Counsel :
Mr. Anton Baier, BAIER Rechtsanwälte
Ms. Amelie Huber-Starlinger, BAIER Rechtsanwälte
Mr. Erhard Böhm, BAIER Rechtsanwälte
Mr. Gregor Grubhofer, BAIER Rechtsanwälte
Ms. Marie-Christine Motaabbed, BAIER Rechtsanwälte
Parties :
Mr. Michael Kalwil, Member of Executive Board of SIHAG; Member of Strabag
Ms. Gabriele Deffner, Member of Executive Board of SIHAG; Member of Strabag
Ms. Renate Koch-Habenbacher, Head Legal Department of Raiffeisen Centrobank
Ms. Monika Sitowicz, Dentons Europe Oleszczuk sp. k.
Respondent
Counsel :
Mr. Tomasz Wardyński, Wardyński & Partners
Mr. Stanisław Drozd, Wardyński & Partners
Mr. Piotr Golędzinowski, Wardyński & Partners
Dr. Marta Cichomska, Office of the General Counsel to the Republic of Poland
Ms. Kamila Lipecka, Office of the General Counsel to the Republic of Poland
Prior to transfer to third parties, the Minister of State Treasury or the Privatization Agency decides to (1) make an analysis to determine a legal status of a corporation's enterprise property, in particular any third party claims against such property.6
- Chapter I:
Having examined the legal, economic and financial situation of the Company, the experts recommend the acquisition of a majority stake in the Company to potential investors. The investment should have a long-term perspective.
- Article 3.12.2:
Real Properties: The Company is the perpetual usufructuary of the following plots of land and owns the buildings on the land … Real property situated in Warsaw … Plot No. 39 … developed with two hotel buildings: Polonia Hotel and Metropol Hotel …
- Article 3.12:
The Company holds and uses without a legal title the real property situated in Warsaw … developed with a hotel building: MDM Hotel.
- Chapter IV:
All the buildings owned by the Company (except for the MDM Hotel…) have a regulated legal status. The owner of the plots of land indicated in point III 'Real properties' is the Capital City of Warsaw … The owner of buildings and perpetual usufructuary of the plots of land is Hotels Warszawskiw Syrena … In accordance with the notarial deed of 19 November 1991, as proven by Enfranchisement Decisions No. … 489/93…
- Additional Information:
The formal and legal status of the land title is regulated.
The legal status of hotel Metropol is regulated. The Company is perpetual usufructuary of the land plot and the owner of the hotel building erected on the plot. Land and Mortgage Register has been established for the property. A reservation is made in the Register regarding the claims of former successors to the former owners of the property, whose application for temporary ownership of the property was declined in 1996 by the Minister of Spatial Development and Construction. The applicants can demand that the case be decided by the Supreme Administrative Court, to which they have already filed a complaint. Simultaneously, the successors have applied to the Self-government Appeal Council in Warsaw for invalidation of the administrative decision granting the Company perpetual usufruct of the land on which Metropol Hotel has been built.15
The Company Hotele Warszawskie 'Syrena' is the perpetual usufructuary of the land and ownership of the buildings on the land … real property situated in Warsaw at Ul. Jerozolimskie 45 … Plot No. 39 …. Developed with two hotel buildings: Polonia Hotel and Metropol Hotel, land and mortgage register No. 143520 … the above real estates are free from mortgages and other encumbrances.20
(i) pay [REDACTED] million (approximately [REDACTED]) for the ownership of 80% of the shares in Syrena Hotels;
(ii) purchase further shares in Syrena Hotels held by the City of Warsaw and of employees;
(iii) invest ATS [REDACTED] ([REDACTED]) in Syrena Hotels' assets;
(iv) provide the City of Warsaw with an investment guarantee in case of non-fulfilment of the investments paragraph (iii) above;
(v) ensure for the future that the main object of the Buyer would be to provide services in the hotel business and not to change this main object without the prior consent of the City of Warsaw;
(vi) not liquidate without the prior consent of the City of Warsaw;
(vii) purchase for Syrena Hotels an unregulated part (31%) of the ownership of the MDM Hotel and the right of perpetual usufruct over of the land on which a part of the MDM Hotel is located; and
(viii) accept the employment and social guarantee package agreed upon by contract of 4 September 1996 between the employees of Syrena Hotels and the City of Warsaw.
Proportional value as of 18 March 1997 | Valuation as of 1 February 2014 | |
Hotel Polonia | [REDACTED] (then a 3-star hotel) | [REDACTED] (now a 4-star hotel) |
Hotel Metropol | [REDACTED] | [REDACTED] |
The Capital City of Warsaw expressly confirmed that the legal status of the right of perpetual usufruct and the ownership right are regulated. The Capital City of Warsaw only mentioned demands of former owners concerning a part of the land underneath Hotel Metropol as theoretical and insignificant as they had, inter alia, already been officially rejected.34
- Article 2: "Encouragement and Protection of Investments";
- Article 3: "Treatment of Investments";
- Article 4: "Compensation" for expropriation;
- Article 5: "Transfers";
- Article 7: "Other Obligations"; and
- Article 8: Settlement of Investment Disputes.47
(a) Declaring that Respondent has violated the Austria-Poland Bilateral Investment Treaty with respect to the Investors' investments;
(b) Declaring that the actions and omissions of Respondent and those of its organs, institutions and entities for which it is internationally responsible, inter alia and by way of example and without limitation, are unlawful, arbitrary, discriminatory, unfair and inequitable, constitute an expropriation or measures tantamount to expropriation without compensation and a denial of justice and that Respondent and those of its organs, institutions and entities for which it is internationally responsible, inter alia and by way of example and without limitation, failed to provide fair and equitable treatment, failed to provide full protection and security and failed to provide most favoured nation treatment and treatment in accordance with international law and the Share Purchase Agreement;
(c) Dismissing the Intra-EU Jurisdictional objection advanced by Respondent and decides that it has jurisdiction of the dispute;
(d) Directing Respondent to re-establish the situation which existed before the breaches occurred;
(e) Directing Respondent to pay, in any case, damages or monetary refund equivalent to all damages incurred or to be incurred in the future by the Investors and their investments, as set forth herein and as may be further developed and quantified in the course of this proceeding and in the future;
(f) Directing Respondent to pay Claimants the amount of [REDACTED] and to abandon or to prompt the Capital City of Warsaw to abandon the pending lawsuit for an additional amount of [REDACTED] before the Polish courts or to pay all damages or monetary refund equivalent to all damages incurred by the Investors due to Respondent's unlawful actions, as set forth herein and which may be further developed and quantified in the course of this proceeding;
(g) Directing Respondent to pay compound pre- and post-award interest until the date of full and effective payment of Respondent on all sums awarded;
(h) Directing Respondent to pay the Investors' costs associated with these proceedings, as far as Article 8 of the BIT provides therefore;
(i) Any other relief the Arbitral Tribunal may deem just, proper and appropriate.48
I. Decide that the Tribunal does not have jurisdiction over the Claimants' claims as set forth in the Request for Arbitration, Claimants' Jurisdictional Counter-Memorial Claimants' Jurisdictional Rejoinder Memorial and Claimants' First Post-Hearing Brief and/or the Claimants' claims are inadmissible.
II. Should the Tribunal find that it has jurisdiction over any of the Claimants' claims and that these claims are not inadmissible, the Respondent respectfully requests the Tribunal to dismiss the Claimants' claims in their entirety.
III. In any event, the Respondent respectfully requests the Tribunal to order the Claimants to pay the costs of this arbitration, as well as the fees and expenses relating to the Respondent's legal representation, in-house costs, fees and expenses of any expert appointed by the Respondent or the Tribunal, and all other reasonable costs, as far as Article 8 of the Treaty provides therefor.
IV. Order such other relief as the Tribunal, in its discretion, considers appropriate.61
(1) Are the rights upon which the Claimants rely for their claims covered by the Treaty?
(2) Are the facts alleged by the Claimants capable of coming within all or at least some of the Treaty's provisions invoked by the Claimants?
(3) Are the Claimants' allegations "incoherent and conclusory"?
(1) The term "investment" shall include all assets, in particular but not exclusively:
a) Ownership of movable and immovable property and other rights in rem, such as mortgages, rights of retention, pledges, rights of usufruct, and similar rights;
b) Participation rights and other types of participations in enterprises;
c) Claims to money provided in order to create an economic value or claims to performances having an economic value; and
d) Copyrights, industrial property rights such as inventor's patents, trademarks and industrial designs and models, registered designs, technical procedures, know-how, trade names and good will.
Any juridical person, organization or association, with or without legal personality, lawfully established in accordance with the legislation of one of the Contracting Parties, having its seat in the territory of that Contracting Party and undertaking an investment in the territory of the other Contracting Party.
Each Contracting Party shall as far as possible promote in its territory investments of investors from the other Contracting Party, shall authorize such investments in accordance with its own legislation and shall treat them at any rate in a just and equitable manner.
(1) Each Contracting Party shall treat investments of investors from the other Contracting Party undertaken on its territory in accordance with all legislation relevant to their establishment and utilization no less favourably than investments of its own investors or by investors from third countries.
(2) Within its own territory, each Contracting Party shall treat any activity by investors from the other Contracting Party, in relation to an investment, and in particular to its administration, application, use and enjoyment, no less favourably than the activity of its own investors or of investors from third countries.
(1) Investments of investors from one Contracting Party may be expropriated on the territory of the other Contracting Party only in the public interest, on the basis of a lawful procedure and against compensation. Such compensation must represent the value of the investment immediately before the time at which the actual or imminent expropriation becomes publicly known. The compensation must be provided without unreasonable delay and until paid out must carry the normal banking interest rate of the State in whose territory the investment had been made; it must be actually realizable and freely transferable. No later than the time of expropriation suitable provision shall exist for the determination and payment of compensation.
(2) If one of the Contracting Parties expropriates the assets of a company which under article 1, paragraph 2 of this Agreement should be regarded as belonging to that Contracting Party, and in which an investor from the other Contracting Party has a holding, than the Contracting Party shall apply the stipulations of paragraph 1 of this article in such a manner that appropriate compensation is guaranteed to that investors.
(3) The investor shall be entitled to have examined the legality of such expropriation by appropriate organs of the Contracting Party which has ordered the expropriation.
(4) The investor shall be entitled to have examined the amount of such compensation by either the appropriate organs of the Contracting Party which has ordered expropriation, or an international arbitral tribunal as provided for in article 8.
(5) With regard to the matters governed by paragraph 1, paragraph 2, paragraph 3 and paragraph 4 of this article, investors from one Contracting Party shall not be treated any less favourably than investors from the other Contracting Party or from third countries.
(1) Each Contracting Party shall guarantee to investors from the other Contracting Party that they may transfer freely, without unreasonable delay, in a freely convertible currency the payments which relate to an investment, in particular but not exclusively:
a) Capital and additional sums to maintain or expand the investment;
b) Sums intended to cover expenditures relating to the administration of the investment;
c) Returns;
d) Loan repayments;
e) The yield in the event of the complete or partial liquidation or sale of the investment;
f) Compensation pursuant to article 4, paragraph 1.
(1) If the legislation of either Contracting Party or international obligations of the two Contracting Parties, which presently apply in additional to this Agreement or which are established in the future, should give rise to a general or specific agreement which accords to the investments of investors from the other Contracting Party more favourable treatment than is provided for by this Agreement, such arrangement shall have precedence over this Agreement, in so far as it is more favourable.
(2) Each Contracting Party shall comply with any contractual obligation it may have entered into with respect to investors from the other Contracting Party concerning investments which it has authorized in its territory.
(1) If disputes should arise between one Contracting Party and an investor from the other Contracting Party with regard to an investment, such disputes shall be resolved amicably between the parties themselves if possible. If such amicable resolution is not possible, then the investor shall exhaust all relevant domestic administrative and judicial remedies.
(2) If such a dispute cannot be settled in a manner provided for in paragraph 1 within 12 months from written notification of adequately specified claims, it shall at the request of the Contracting Party or of the investor from the other Contracting Party, be submitted for conciliation or arbitration:
a) to the International Centre for Settlement of Investment Disputes, if both Contracting Parties are signatories to the Convention on the Settlement of Investment Disputes between States and nationals of other States, opened for signature at Washington on 18 March 1965. In the event of arbitration, each of the Contracting Parties, by becoming a signatory to this Agreement, undertakes irrevocably and in advance, even if there should be no individual arbitration agreement between a Contracting Party and an investor, to submit such disputes to the Centre and to recognize the arbitration award as binding.
b) to an international arbitral tribunal, if either of the Contracting Parties is not a signatory to the Convention on the Settlement of Investment Disputes between States and nationals of other States. The international arbitral tribunal shall be constituted on an ad hoc basis in the following manner: each side shall appoint an arbitrator, and these arbitrators shall agree on a chairman, who shall be a national of a third State. The arbitrators shall be appointed within two months from the date on which the investors has notified the other Contracting Party of his desire to submit the dispute to an arbitral tribunal and the chairman within further two months.
If the time-limits given in the paragraph above are not observed and if no other agreements reached, either side may request the President of the International Court of Justice to make the necessary appointments. If the President of the International Court of Justice is a national of either Contracting Party or if he is unable to act for any other reason, the Vice-President or, if he is unable to act, the longest-serving member of the International Court of Justice, may under the same conditions be asked to make the necessary appointments. The arbitral tribunal shall determine its rules of procedure by applying as appropriate the procedural rules of the Convention on the Settlement of Investment Disputes between States and nationals of other States of 18 March 1965; the decision shall include a statement of the basis on which it has been made, and supporting reasons shall be given if either side so requests.
(3) The decision of the tribunal shall be final and binding. It shall be enforced by domestic law, and each Contracting Party shall ensure the recognition and enforcement of arbitral awards in accordance with its relevant legislation.
(4) Each side shall bear the costs of its own arbitrator and the costs of its representation in the proceedings before the arbitral tribunal; the costs of the chairman and the other costs shall be borne in equal shares by both sides.
(5) A Contracting Party which is a party to a dispute shall not, at any stage of the conciliation or arbitration proceedings or enforcement of an arbitral award, raise an objection on the grounds that the investor who is the other party to the dispute has received compensation for all or some of its losses through an insurance policy.
(1) Differences of opinion between the Contracting Parties concerning the interpretation or application of this Agreement shall as far as possible be settled by amicable negotiations.
(2) If a difference of opinion cannot be resolved within six months, it shall be submitted to an arbitral tribunal at the request of either Contracting Party.
(3) The arbitral tribunal shall be formed on a case-by-case basis by each Contracting Party appointing one member and both of members [=co-arbitrators] agree on a national of a third State as chairman who is to be appointed by the Governments of the two Contracting Parties. The members [=co-arbitrators] are to be appointed within 2 months after one Contracting Party notified the other Contracting Party that it intends to submit the difference of opinion to an arbitral tribunal; the chairman is to be appointed within a further two months.
(4) If the deadlines referred to in paragraph 3 are not complied with, any Contracting Party may, in the absence of any other agreement, request the President of the International Court of Justice to make the necessary appointments. If the President of the International Court of Justice is a national of either Contracting Party or is otherwise unable [to make the appointment], the Vice-President or, in the event of his hindrance, the senior member of the International Court of Justice may be invited to make the appointments under the same conditions.
(5) The Arbitral Tribunal determines the arbitration procedure.
(6) The arbitral tribunal shall decide on the basis of this Agreement as well as on the generally recognized rules of international law. It decides by majority of votes; the decision is final and binding.
(7) Each Contracting Party shall bear the costs of its member and its representative in the arbitral proceedings; the costs of the chairman and other costs shall be borne equally by the two contracting parties. The arbitral tribunal may, however, decide on a different cost allocation in its ruling.
Once entered into force, this Agreement shall apply to all existing and future investments undertaken by investors of one Contracting Party in accordance with the legislation of the other Contracting Party on the territory of the Contracting Party.
(1) This Agreement requires ratification and will enter into force on the first day of the third month following the month in which the instruments of ratification have been exchanged.
(2) The Agreement will remain in force for ten years; after the expiration [of the 10-year period], it will be extended indefinitely, unless one of the two contracting parties terminates the agreement in writing with a notice period of twelve months. After ten years, the agreement can be terminated at any time, but remains in effect for a further year after the termination notice.
(3) For investments made up to the date of termination of this Agreement, Articles 1 to 10 shall continue to apply for a further 10 years from the date of the termination of the Agreement.
Article 156
§ 1. A public administration body shall invalidate any decision which:
1) was issued in breach of the regulations on jurisdiction,
2) was issued without legal basis or in blatant breach of the law,
3) concerns a case that has already been dealt with by a separate final decision,
4) has been addressed to a person who is not a party to the proceedings,
5) was unenforceable at the date of issue and such unenforceability is of a permanent nature,
6) its enforcement would result in commitment of a criminal act,
7) contains a defect which renders it invalid by law.
§ 2. A decision may not be invalidated for the reasons given in § 1, (1), (3), (4) and (7), if 10 years have lapsed from the date of its service or publication, and also if the decision would have irreversible legal consequences.
Article 157
§ 1. In the cases referred to in Article 156 the jurisdiction to invalidate a decision belongs to a higher body, and if the decision was issued by a minister or a self-government appeal council – those bodies shall have jurisdiction.
§ 2. Proceedings for the invalidation of a decision can be commenced at the instigation of the party or ex officio. […]
Article 158
§ 1. The invalidation of a decision shall be made by way of a decision.
§ 2. If a decision cannot be invalidated because of the circumstances referred to in Article 156 § 2, the public administration body shall confine itself to declaring that the challenged decision breaches the law and indicating the circumstances for which it has been unable to declare the decision invalid.
Article 159
§ 1. The public administration body having jurisdiction to invalidate a decision shall suspend the enforcement of the decision ex officio or at the instigation of the party, if there is a likelihood that it contains one of the defects referred to in Article 156 § 1.
§ 2. A party has a right to make an interlocutory objection against a ruling suspending the enforcement of a decision.
The Seller represents and warrants to the Buyer that the additional information on legal and financial standing of the Company, as at the day of signing this Agreement, is provided in a statement of the Management Board of the Company and in the balance sheet for 1996, which are enclosed with this Agreement as Attachment No 5 and Attachment No 6.
the Buyer is familiar with all the documents and written information obtained from the Seller during the tendering procedure, in particular with the information included in the Information Memorandum of May 1996 and in the Supplement to the Information Memorandum of October 1996, concerning the legal and financial standing of the Company; the Buyer does not raise any objections or doubts towards the Seller in this respect.
The Buyer and the Board of the Capital City of Warsaw express their following intention: if the Capital City of Warsaw and/or Municipality of Centrum sell the rights to the plots of land where the buildings owned by the Company are located, the Company shall acquire this right, on terms and conditions separately agreed upon by the parties of the relevant real estate sales agreement.
4.2.1 The Buyer undertakes to make by 31 December 2003 investment outlays for buildings owned by the Company at the time of the acquisition of Shares; […]
4.2.4 The total value of investments … to be made by 31 December 2003, shall be at least an equivalent of [REDACTED], calculated at the ATS buying rate published by the National Bank of Poland and applicable on the day when a given expenditure is incurred by the Buyer.
4.2.5 The Buyer is deemed to have fulfilled the obligations specified in points 4.2.1 and 4.2.4 when the investment is financed by a combination of: own funds of the Company, funds contributed to the share capital of the Company as a result of share capital increase, loans, bank credits, or loans provided by shareholders – on terms and conditions which the Buyer considers most economically viable.
4.2.6 In order to facilitate the control by the Seller of the Buyer's fulfilment of the obligations under points 4.2.1 to 4.2.5, the Buyer shall cause that the Management Board of the Company will instruct the auditors preparing the report from the audit of financial statements of the Company for the years when any of the said obligations are in force for the Buyer, to prepare a separate report on the Buyer's fulfilment of the said obligations; the fulfilment of the said obligations should be presented cumulatively, starting from the first year when they were in force, and copies of such reports will be delivered to the Seller not later than within one month after the balance sheet of the Company has been approved by the shareholders' meeting.
4.2.7 If the Buyer fails to make the investments in the Company within the deadline as provided for in points 4.2.1 to 4.2.5, the Buyer shall pay to the Seller a contractual penalty, calculated in accordance with the following principles. If the amount of investments which were not made is lower or equal to the equivalent of [REDACTED], the contractual penalty shall not be charged. If the amount of investments which were not made is higher than the equivalent of [REDACTED], the contractual penalty due to the Seller shall be calculated as the difference between the amount of [REDACTED] of [REDACTED] and the amount that has been invested.
Having examined the legal, economic and financial situation of the Company, the experts recommend acquisition of a majority stake in the Company to potential investors. The investment should have a long-term perspective.
The Memorandum provides objective information on the Company, basic components of its assets and financial results for the previous year. The Memorandum aims to attract interest of investors in the Company. It is to serve as an impulse for making bids.
Sale of shares is the final stage of ownership transformation of the Company. It will be effected pursuant to the Act of 13 July 1990 on the privatisation of state-owned enterprises (under the procedure established by Article 23(3) in conjunction with Article 45 and Article 24 – Journal of Laws No. 51, item 298) and pursuant to § 2 of resolution No. 12/84/91 of the Council of the Capital City of Warsaw of 24 June 1991 on the organisational and legal form of the Warsaw Tourism Enterprise SYRENA in Warsaw.
2. Real property situated in Warsaw at Al. Jerozolimskie 45, marked in the land register in cadastral unit Warsaw-Sródmiescie, cadastral district 5-05-01, plot No. 39 with surface area of 4,163 sq.m. developed with two hotel buildings: POLONIA hotel and METROPOL hotel;
[…]
In addition, the Company holds and uses without a legal title the real property situated in Warsaw at pl. Konstytucji 1, marked in the land register in cadastral unit Warsaw-Sródmiescie, cadastral district 05-05-06, plots No. 54/1, 54/2, 56/1, 56/2, 56/3, 58/1, 59/1, 59/2, 59/3, 60/2, 60/3, 60/4 with total surface area of 2,489 m 2 developed with a hotel building: MDM hotel.
All the buildings owned by the Company (except for MDM hotel situated at pl. Konstytucji) have a regulated legal status. The owner of the plots of land indicated in point III "Real properties" is the Capital City of Warsaw as the legal successor of the Union of Districts-Municipalities of Warsaw, pursuant to the Act of 25 March 1994 on the regime of the Capital City of Warsaw (Journal of laws No. 48, item 195). The owner of buildings and perpetual usufructuary of the plots of land is Hotele Warszawskie SYRENA sp. z o.o. as the legal successor of Warsaw Tourism Enterprise SYRENA, in accordance with the notarial deed of 19 November 1991, as proven by enfranchisement decisions No. 487/93, 488/93, 489/93, 490/93 and 491/93 of 29 June 1993. The municipalisation and enfranchisement proceedings concerning the plot of land and building of MDM hotel are pending.
The legal status of hotel Metropol is regulated. The Company is perpetual usufructuary of the land plot and the owner of the hotel building erected on the plot. Land and Mortgage Register has been established for the property. A reservation is made in the Register regarding the claims of former successors to the former owners of the property, whose application for temporary ownership of the property was declined in 1996 by the Minister of Spatial Development and Construction. The applicants can demand that the case be decided by the Supreme Administrative Court, to which they have already filed a complaint. Simultaneously, the successors have applied to the Self-government Appeal Council in Warsaw for invalidation of the administrative decision granting the Company perpetual usufruct of the land on which Metropol Hotel has been built.
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 connexion with the conclusion of the treaty;
(b) any instrument which was made by one or more parties in connexion with the conclusion of the treaty and accepted by the other parties as an instrument related to the treaty.
3. 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.
4. A special meaning shall be given to a term if it is established that the parties so intended.
When all the parties to the earlier treaty are parties also to the later treaty but the earlier treaty is not terminated or suspended in operation under article 59, the earlier treaty applies only to the extent that its provisions are compatible with those of the latter treaty.
1. A treaty shall be considered as terminated if all the parties to it conclude a later treaty relating to the same subject-matter and:
(a) it appears from the later treaty or is otherwise established that the parties intended that the matter should be governed by that treaty; or
(b) the provisions of the later treaty are so far incompatible with those of the earlier one that the two treaties are not capable of being applied at the same time.
2. The earlier treaty shall be considered as only suspended in operation if it appears from the later treaty or is otherwise established that such was the intention of the parties
any and all controversies relating to the SPA should be dealt with between the parties to this agreement, i.e. between the Municipality (as the seller) and Strabag (as the legal successor of the buyer). The respective forum for deciding any and all disputes relating to the alleged breaches of the SPA are the Polish common courts. Such disputes should be decided under Polish law, which governs the SPA. The Respondent notes that such a dispute was initiated by Strabag in September 2015 and is currently pending before the Regional Court in Warsaw.15
- The Claimants' expectation that no further restitution claims would be pursued in relation to Hotel Polonia was neither reasonable nor legitimate.19
- The Claimants failed to establish that they suffered any discriminatory treatment.20
- Neither the Claimants' investment nor the Bank Guarantee has been expropriated.21
The prima facie test requires a tribunal to accept the facts as pleaded by a claimant pro tem and then to determine whether those facts, on condition they can be proven in the subsequent stage, are sufficiently plausibly based on the Treaty or might, at least in theory, establish a Treaty breach. Issues as to whether a claim may be successful as a matter of law or whether a claimant only pretends to exercise a right (i.e. is abusing a "right") properly belong to the merits phase.25
31. Where the Court has to decide, on the basis of a treaty whose application and interpretation is contested, whether it has jurisdiction, that decision must be definitive … It does not suffice, in the making of this definitive decision, for the Court to decide that it has heard claims relating to the various articles that are "arguable questions" or that are "bona fide questions of interpretation" (each being suggestions advanced in this case). This is so notwithstanding that the Interhandel case (with its passing reference to a 'provisional conclusion') and the Military and Paramilitary Activities in and against Nicaragua case do not fit easily into this approach. The treatment of the issue in the latter case contained so many remarkable elements and so many diverse views that it cannot be seen as a clear decision by the Court to move away from the approach so powerfully established in the Mavrommatis case. Nor, in my view, is the answer to be found in the establishment of a "reasonable connection" between the claims and the Treaty – that is a necessary but not sufficient condition.
32. There has been some suggestion that "plausibility" provides another test for determination of whether the Court has jurisdiction. It was said in the Ambatielos case that the Court must determine whether the arguments of the applicant State "in respect of the treaty provisions on which the Ambatielos claim is said to be based, are of a sufficiently plausible character to warrant a conclusion that the claim is based on a Treaty" (I.C.J. Reports 1953, p. 18. "Plausibility" was not the test to warrant a conclusion that the claim might be based on the Treaty. The only way in which, in the present case, it can be determined whether the claims of Iran are sufficiently plausibly based upon the 1955 Treaty is to accept pro tem the facts as alleged by Iran to be true and in that light to interpret Articles 1, IV and X for jurisdictional purposes - that is to say, to see if on the basis of Iran's claims of fact there could occur a violation of one or more of them.37
the fact that a breach may give rise to a contract claim does not mean that it cannot also – and separately – give rise to a treaty claim. Even if the two perfectly coincide, they remain analytically distinct, and necessarily require different enquiries.43
Each Contracting Party shall as far as possible promote investments made in its territory by investors from the other Contracting Party, shall authorize such investments in accordance with its own legislation and shall treat them at any rate in a just and equitable manner.
- By issuing the Enfranchisement Decision and the Municipalisation Decision and by conducting the privatisation of Syrena Hotels, the Respondent's authorities assured Strabag of the undisputable existence of the right of perpetual usufruct and the ownership of the hotels.49
- The Capital City of Warsaw specifically assured and warranted to Strabag that Syrena Hotels had the right of perpetual usufruct and the ownership of the buildings in Article 3.6. of the SPA and related documents, including the Declaration of the Management Board of Syrena, Article 3.12 and Chapter IV of the Information Memorandum and the Supplement.50
- The Board Declaration expressly stated that the real estate held by Syrena Hotels at the time of the SPA was "free from mortgages and other encumbrances".51
- The Information Memorandum represented that "[n]o circumstances exist that could materially affect the legal, proprietorial or financial situation of [Syrena Hotels]".52
- The City of Warsaw specifically assured and warranted to Strabag in the Information Memorandum that the "legal status of the hotels and land is regulated".53
- The Board Declaration assured Strabag that there were no pending proceedings with regard to Plot 39 and the buildings on it.54
Given the fact that the Investors would have to commit massive amounts of capital in the beginning and in the subsequent years of the hotel business and would only be repaid with an adequate return over a period of many years or even decades from the business revenues, the undisputed right of perpetual usufruct of the land and the ownership of the hotel buildings were key factors for the Investors. The assets of the Company, i.e. the right of perpetual usufruct with regard to the respective plots of land as well as the ownership in the hotels built thereupon, were and are of crucial importance for the Claimants' decision to enter into the investment and to continuously contribute the economy of Poland.55
- The invalidation of the Enfranchisement Decision.
- The City of Warsaw's issuance of certificates in favour of [REDACTED] allegedly confirming her ownership of Hotel Polonia.57
- The City of Warsaw's 24 December 2012 Christmas Decision, which held that [REDACTED] is the legal owner of Hotel Polonia and that she is granted the right of perpetual usufruct for the land underneath Hotel Polonia.58
- The deletion of Syrena Hotels from the Land and Buildings Register.
- Actions of the Respondent's authorities during the proceedings initiated by [REDACTED]59
- The improper drawing on the Bank Guarantee.
A well-established aspect of this standard is that host States must use "due diligence" to prevent wrongful injuries to the person or property of aliens caused by third parties or at least to remedy those that could not have been prevented. Claimants do not advocate that the standard may prevent the Investors from each and every injury. However, it does require States, and in the present case Respondent, to take reasonable actions within its power to avoid or remedy such injuries.64
(1) Each Contracting Party shall treat investment of investors from the other Contracting Party undertaken on its territory in accordance with all legislation relevant to their establishment and utilization no less favourably than investments of its own investors or by investors from third countries.
(2) Within its own territory, each Contracting Party shall treat any activity by investors from the other Contracting Party, in relation to an investment, and in particular to its administration, application, use and enjoyment, no less favourably than the activity of its own investors or of investors from third countries.
(1) Investments by investors from one Contracting Party may be expropriated on the territory of the other Contracting Party only in the public interest, on the basis of a lawful procedure and against compensation. Such compensation must represent the value of the investment immediately before the time at which the actual or imminent expropriation becomes publicly known. Such compensation must be provided without unreasonable delay and until paid out must carry the normal banking interest rate of the State in whose territory the investment had been made; it must be actually realizable and freely transferable. No later than the time of expropriation suitable provision shall exist for the determination and payment of compensation.
(2) If one of the Contracting Parties expropriates the assets of a company which under article 1, paragraph 2 of this Agreement should be regarded as belonging to that Contracting Party, and in which an investor from the other Contracting Party has a holding, [then] the first Contracting Party shall apply the stipulations of paragraph 1 of this article in such a manner that appropriate compensation is guaranteed to that investor [].
(3) The investor shall be entitled to have examined the legality of such expropriation by appropriate organs of the Contracting Party which has ordered the expropriation.
(4) The investor shall be entitled to have examined the amount of such compensation by either the appropriate organs of the Contracting Party which has ordered expropriation, or an international arbitral tribunal as provided for in article 8.
(5) With regard to the matters governed by paragraph 1, paragraph 2, paragraph 3 and paragraph 4 of this article, investors from one Contracting Party shall not be treated any less favourably than investors from the other Contracting Party or from third countries.
- Invalidating the Enfranchisement Decision.
- Issuing certificates in favour of [REDACTED] allegedly confirming her ownership of Hotel Polonia.78
- Supporting [REDACTED] in the Polish Court proceedings.79
- Issuing the 24 December 2012 Christmas Decision.80
- Deleting Syrena Hotels from the Land and Buildings Register.
- Accepting investments of approximately EUR [REDACTED] million and collecting approximately [REDACTED] million under the Bank Guarantee for hotel buildings allegedly not owned by Syrena Hotels.
- Improperly drawing on the Bank Guarantee.
(1) Each Contracting Party shall guarantee to investors from the other Contracting Party that they may transfer freely, without unreasonable delay, in a freely convertible currency the payments which relate to an investment, in particular but not exclusively:
(a) Capital and additional sums to support or expand the investment;
(b) Sums intended to cover expenditures related to the management of the investment;
(c) Returns;
(d) Loan repayments;
(e) The yield in the event of the complete or partial liquidation or sale of the investment;
(f) Compensation pursuant to article 4, paragraph 1.
[...]
(4) The treatment accorded under paragraph 1 and paragraph 2 of this article shall not be any less favourable than that accorded to investors from third countries.
If the legislation of either Contracting Party or present or future mutual international obligations of the two Contracting Parties additional to this Agreement should give rise to a general or specific agreement which accords to the investments of investors from the other Contracting Party more favourable treatment than is provided for by this Agreement, such arrangement shall have precedence over this Agreement, in so far as it is more favourable.
it is unviable to say that the [EHCR] envisages a higher standard of protection than the BIT, which is specifically meant to protect the investments. So the Claimants would also have to explain what specifically is the standard that they alleged was breached, why is it different from the BIT standard.
In any case, we submit that the Tribunal should not be exercising jurisdiction over alleged violations of the [ECHR] on this rather invented interpretation of Article 7(1) of the BIT. This would lead to an unreasonable extension of the Tribunal's jurisdiction. The Tribunal should of course take the European Convention into account in interpreting the BIT standards, because investment law at the end of the day is also protection of human rights, right to property. But the Tribunal does not have jurisdiction to hold Poland responsible for alleged breaches of the European Convention on Human Rights even under the widest possible interpretation of Article 7(1) of the BIT.91
Each Contracting Party shall comply with any contractual obligation it may have entered into with respect to investors from the other Contracting Party concerning investments which it has authorized in its territory.93
Respondent breached contractual obligations within the meaning of Article 7 (2) of the BIT at least by:
• Transferring the hotel businesses including the hotels Polonia, Metropol and the related land plots encumbered with third-party claims (Art. 2.3.1 of the SPA);
• Forcing the investors to invest into hotel buildings in a long-term perspective, despite the existence of encumbrances (Art 4.2 of the SPA);
• Granting pre-emptive ownership rights in relation to land plots that are encumbered with third-party claims (Art. 3.6 of the SPA).94
(i) the obligations of the Buyer under the SPA have been fulfilled on equal parts by all three [Claimants] ; (ii) this was known to Respondent and Respondent even approved it and most importantly (iii) Respondent was at all times aware that any violation of its obligations under the SPA would not only cause damage to STRABAG but to SIHAG and [Raiffeisen] as well.109
If disputes should arise between one Contracting Party and an investor from the other Contracting Party with regard to an investment, such dispute shall be resolved amicably between the parties themselves if possible…
the claimant uses it to achieve an undue "collateral advantage", e.g. by pursuing claims of a purely contractual nature under a BIT disguise, to avoid engaging in a good-faith contractual controversy with the respondent and to harass the respondent with demands which are clearly not available under the contract. The BIT process is also abused if it is treated as a "fourth instance", merely to unreasonably multiply proceedings and to retry the very matter which has already been resolved or is pending before the domestic court, while there are no specific allegations of any BIT provisions having been breached in the domestic proceedings.4
- pursuing their essentially contractual claims in international arbitration to gain undue collateral advantage, by seeking to pressure the Respondent to deprive third parties of their rights arising from laws and policies that were in place at the time that the Claimants made their investment;7
- pursuing the claims relating to the Bank Guarantee before Polish and Austrian courts and then bringing the same claims in this arbitration.8
THE PRESIDENT: Maybe I can put it another way. You know from cases like Vivendi, going up to a case like Bayindir v Pakistan, where Professor Böckstiegel was one of the arbitrators, the claim could be made in contract or in treaty, and yet both tribunals allowed the claim to go forward as a treaty breach, even though to -- and I will say "to a layman", because I was counsel in one of those cases -- it might seem to be an obvious contract claim, with an arbitration clause, a contract with applicable law, and so on and so forth. These tribunals draw a very clear distinction between a treaty breach and a contract breach. You can have a treaty breach without a contract breach, you can have a treaty breach with a contract breach, but of itself that doesn't make it an abuse of process to bring a treaty claim before an investment treaty tribunal. So the cases seem to be more against you than with you. But if you can think of a case in addition to the case you cited, Azinian, we'd like to hear it.
MR DROZD: Well, I have to clarify something, not to mislead the Tribunal. I did not quote the Azinian case as an authority supporting my submission, because it doesn't. It's not an authority to support this principle. It speaks of something completely different: it speaks of what I described as a collateral attack on a decision of a municipal court. To be frank, I think I might not be able to indicate the authorities which you enquire about, Mr President. But I would like to explain one thing. I do appreciate, and I completely agree, that conceptually there is a distinction between a contract claim and a treaty claim, and the same facts can lead to a contract claim or a BIT claim completely legitimately. It is just like the same facts could lead to a contract claim or a tort claim; the same facts could give the Claimants grounds for those two separate claims.15
For the purpose of this Agreement:
(1) The term "investment" shall include all assets, in particular but not exclusively:
a) Ownership of movable and immovable property and other rights in rem, such as mortgages, rights of retention, pledges, rights of usufruct, and similar rights;
b) Participation rights and other types of participations in enterprises;
c) Claims to money provided in order to create an economic value or claims to performances having an economic value; and
d) Copyrights, industrial property rights such as inventor's patents, trademarks and industrial designs and models, registered designs, technical procedures, know-how, trade names and good will.
(2) The term "investor" shall mean:
a) Any individual possessing the nationality of one of the Contracting Parties and undertaking an investment in the territory of the other Contracting Party;
b) Any juridical person, organization or association, with or without legal personality, lawfully established in accordance with the legislation of one of the Contracting Parties, having its seat in the territory of that Contracting Party and undertaking an investment in the territory of the other Contracting Party.
favourable conditions for enhanced economic cooperation between the Contracting Parties, Recognizing that the encouragement and protection of reciprocal investments may lead to greater willingness to undertake such investments and thus make an important contribution to the development of economic relationships.
Article 8
SETTLEMENT OF INVESTMENT DISPUTES
(1) If disputes should arise between one Contracting Party and an investor from the other Contracting Party with regard to an investment, such disputes shall be resolved amicably between the parties themselves if possible. If such amicable resolution is not possible, then the investor shall exhaust all relevant domestic administrative and judicial remedies.
(2) If such a dispute cannot be settled in a manner provided for in paragraph 1 within 12 months from written notification of adequately specified claims, it shall at the request of the Contracting Party or of the investor from the other Contracting Party, be submitted for conciliation or arbitration:
a) to the International Centre for Settlement of Investment Disputes, if both Contracting Parties are signatories to the Convention on the Settlement of Investment Disputes between States and nationals of other States, opened for signature at Washington on 18 March 1965. In the event of arbitration, each of the Contracting Parties, by becoming a signatory to this Agreement, undertakes irrevocably and in advance, even if there should be no individual arbitration agreement between a Contracting Party and an investor, to submit such disputes to the Centre and to recognize the arbitration award as binding.
b) to an international arbitral tribunal, if either of the Contracting Parties is not a signatory to the Convention on the Settlement of Investment Disputes between States and nationals of other States. The international arbitral tribunal shall be constituted on an ad hoc basis in the following manner: each side shall appoint an arbitrator, and these arbitrators shall agree on a chairman, who shall be a national of a third State. The arbitrators shall be appointed within two months from the date on which the investors has notified the other Contracting Party of his desire to submit the dispute to an arbitral tribunal and the chairman within further two months.
If the time-limits given in the paragraph above are not observed and if no other agreement is reached, either side may request the President of the International Court of Justice to make the necessary appointments. If the President of the International Court of Justice is a national of either Contracting Party or if he is unable to act for any other reason, the Vice-President or, if he is unable to act, the longest-serving member of the International Court of Justice, may under the same conditions be asked to make the necessary appointments.
The arbitral tribunal shall determine its rules of procedure by applying as appropriate the procedural rules of the Convention on the Settlement of Investment Disputes between States and nationals of other States of 18 March 1965; the decision shall include a statement of the basis on which it has been made, and supporting reasons shall be given if either side so requests.
(3) The decision of the tribunal shall be final and binding. It shall be enforced by domestic law, and each Contracting Party shall ensure the recognition and enforcement of arbitral awards in accordance with its relevant legislation.
(4) Each side shall bear the costs of its own arbitrator and the costs of its representation in the proceedings before the arbitral tribunal; the costs of the chairman and the other costs shall be borne in equal shares by both sides.
(5) A Contracting Party which is a party to a dispute shall not, at any stage of the conciliation or arbitration proceedings or enforcement of an arbitral award, raise an objection on the grounds that the investor who is the other party to the dispute has received compensation for all or some of its losses through an insurance policy.
A treaty shall be considered as terminated if all the parties to it conclude a later treaty relating to the same subject-matter and:
a) It appears from the later treaty or is otherwise established that the parties intended that the matter should be governed by that treaty; or
b) The provisions of the later treaty are so far incompatible with those of the earlier one that the two treaties are not capable of being applied at the same time.
When all the parties to the earlier treaty are parties also to the later treaty but the earlier treaty is not terminated or suspended in operation under Article 59, the earlier treaty applies only to the extent that its provisions are compatible with those of the later treaty.
… according to the [Achmea] Judgement, an award can be set aside pursuant to Art 1059(2) German Civil Procedure Code. The grounds for setting aside an award under that provision include the arbitration agreement being invalid under the law to which the parties have subjected it, and the recognition or enforcement of the award would be contrary to public policy. By contrast, in the present case, an application for setting aside will have to be brought before a French court which will have to apply Art 1520 of the French Civil Procedure Code. Under that provision, an award can be set aside if, amongst others, the arbitral tribunal wrongly upheld or declined jurisdiction. These are two entirely different sets of rules (already from a linguistic point of view).49
Respondent's EU law defence has not been submitted in due time and in a timely manner. Respondent has raised its defence only after the closing of the written phase of the present arbitration and (irrespective of this) shall be deemed to have waived its right to avail itself of such alleged irregularity pursuant to Section 1466 of the French Code of Civil Procedure. Respondent's EU law defence is, therefore, precluded.79