Mr Pey Casado and the Foundation Presidente Allende submitted a Request for Arbitration to ICSID on 7 November 1997, in reliance on the Agreement between the Kingdom of Spain and the Republic of Chile on the Reciprocal Protection and Promotion of Investments ("BIT") which had entered into force on 29 March 1994, Article 10 of which provides:

1. Any dispute concerning investments, as defined in this Agreement, which arises between a Contracting Party and an investor of the other Contracting Party shall, to the extent possible, be settled by means of friendly consultations between the two parties to the dispute.

2. If the dispute cannot be settled within six months of the time it was initiated by one of the Parties, it shall be submitted, at the discretion of the investor, to:

- The national jurisdiction of the Contracting Party involved in the dispute; or

- International arbitration in the conditions described in paragraph 3.

Once the investor has submitted the dispute to the jurisdiction of the Contracting Party involved or to international arbitration, the choice of one or the other procedure shall be final.

3. If the dispute is submitted to international arbitration, it may be brought before one of the following arbitration bodies, at the discretion of the investor:

- The International Centre for Settlement of Investment Disputes (ICSID), established by the Convention on the Settlement of Investment Disputes between States and Nationals of Other States, which was opened for signature in Washington, D.C., on 18 March 1965, when each State Party to this Agreement has acceded to it. As long as this condition remains unmet, each Contracting Party gives its consent to submit the dispute to arbitration in accordance with the rules of the Additional Facility of ICSID;

- An ad hoc court of arbitration established under the arbitration rules of the United Nations Commission on International Trade Law (UNCITRAL).

4. The arbitration body shall take its decision on the basis of the provisions of this Agreement, of the law of the Contracting Party that is a party to the dispute, including the rules relative to conflicts of laws, and of the terms of any specific agreements concluded in relation to investment, as well as of the principles of international law on the subject.

5. The arbitral awards shall be final and binding for the parties to the dispute.

6. The Contracting Parties shall refrain from dealing, through diplomatic channels, with matters concerning arbitration or judicial proceedings already under way until the relevant procedures have been completed, unless the parties to the dispute have not complied with the award of the court of arbitration or the decision of the ordinary court pursuant to the terms of compliance established in the award or decision.¹⁶

The Request was registered on 20 April 1998,¹⁷ and a Tribunal was constituted on 14 September 1998, which will be referred to in this Award as "the First Tribunal".

For the reasons set forth above, the Committee renders the following decisions:

1. Pursuant to Article 52(1)(d) and (e), decides to annul paragraph 4 of the dispositif of the Award of 8 May 2008 and the corresponding paragraphs in the body of the Award related to damages (Section VIII);

2. Rejects the other grounds of the Republic's Application for annulment;

3. Rejects the Claimants' request for the partial annulment of paragraph 8 of the dispositif of the Award;

4. Finds that paragraphs 1 to 3 and 5 to 8 of the dispositif as well as the body of the Award but for Section VIII are res judicata ;

5. Decides that there is no need to order the temporary stay of enforcement of the un-annulled portion of the Award.

6. Decides that each party shall bear one half of the ICSID costs incurred in connection with this annulment proceeding; and

7. Decides that each party shall bear its own litigation costs and expenses incurred with respect to this annulment proceeding.

On 11 March 2014, the Tribunal held its first session with the Parties by telephone. In addition to the Tribunal and its Secretary, the following participated:

For the Claimants:

Dr Juan E. Garcés Garcés y Prada, Abogados
Ms Carole Malinvaud Gide, Loyrette, Nouel
Ms Alexandra Muñoz Gide, Loyrette, Nouel

For the Respondent:

Mr Paolo Di Rosa Arnold & Porter LLP
Ms Gaela Gehring Flores Arnold & Porter LLP
Ms Mallory Silberman Arnold & Porter LLP
Mr Juan Carlos Riesco Carey
Ms Victoria Fernández-Armesto Republic of Chile
Mr Juan Banderas Casanova Republic of Chile

From 13 to 16 April 2015, the Tribunal held an oral hearing in London. In addition to the Tribunal, its Secretary, and the President's Assistant, the following participated:

For the Claimants:

Dr Juan E. Garcés Garcés y Prada, Abogados
Mr Michel Stein Garcés y Prada, Abogados
Mr Hernán Garcés Garcés y Prada, Abogados
Ms Carole Malinvaud Gide, Loyrette, Nouel
Ms Alexandra Munoz Gide, Loyrette, Nouel
Ms Natasha Peter Gide, Loyrette, Nouel
Ms Astrid Westphalen Gide, Loyrette, Nouel
Ms Coral Pey Grebe Foundation Presidente Allende
Ms Francisca Durán Ferraz de Andrade Foundation Presidente Allende
Ms Marie Ducrocq Foundation Presidente Allende
Mr Christophe Schmit Accuracy
Mr Eduard Saura Accuracy

For the Respondent:

Mr Paolo Di Rosa Arnold & Porter LLP
Ms Gaela Gehring Flores Arnold & Porter LLP
Ms Mallory Silberman Arnold & Porter LLP
Ms Shepard Daniel Arnold & Porter LLP
Mr Kelby Ballena Arnold & Porter LLP
Mr Jorge Carey Carey
Mr Gonzalo Fernández Carey
Mr Juan Carlos Riesco Carey
Ms Liliana Machiavello Republic of Chile
Ms Victoria Fernández-Armesto Republic of Chile
Mr Brent C. Kaczmarek, CFA Navigant Consulting, Inc.
Mr Andrew Preston Navigant Consulting, Inc.
Dr Marcos Libedinsky Tschorne

The Respondent recalls that Procedural Order No. 1 identifies the scope of the Tribunal's authority as the matters identified in paragraph 359.1 of the Decision on Annulment, and submits that all the Claimants' requests for relief, in particular those relating to claimed postFirst Award violations of Article 4 of the BIT, exceed the Tribunal's authority, as they either represent a variety of new claims or revisit prior failed claims.²⁶² The Respondent rejects in particular the following: the freestanding expropriation claim; the claim that various post First Award events relating to the Goss press constitute a violation of Article 4 of the BIT; the claim that the behaviour of its representatives amounts to a new violation of Article 4 of the BIT; the claim that national treatment was denied to the Claimants when the owners of most other media companies were compensated for the expropriation of their assets; and the claim based on unjust enrichment.²⁶³

The Respondent submits in the alternative that even if the First Award had failed to address a claim for unjust enrichment, the appropriate proceeding would have been the filing of a request for supplementation pursuant to Article 49(2) of the ICSID Convention, but subject to a fixed time limit of 45 days after the date on which an award is rendered; having failed to observe that, the Claimants must now be deemed to have waived their rights to make such a claim.²⁷²

Par ces motifs, le Comité rend les décisions suivantes :

1. décide d'annuler le paragraphe 4 du dispositif de la Sentence du 8 mai 2008 et les paragraphes correspondants dans le corps de la Sentence relatifs aux dommages-intérêts (Section VIII) conformément à l'article 52(1)(d) et (e) ;

2. rejette les autres fondements de la Demande en annulation de la République ;

3. rejette la demande des Demanderesses tendant à l'annulation partielle du paragraphe 8 du dispositif de la Sentence ;

4. estime que les paragraphes 1 à 3 et 5 à 8 du dispositif ainsi que le corps de la Sentence, à l'exception de la Section VIII, ont autorité de chose jugée.³⁵⁵

1. décide qu'il est compétent pour connaître du litige entre les demanderesses et la République du Chili ;

2. constate que la défenderesse a violé son obligation de faire bénéficier les demanderesses d'un traitement juste et équitable, en ce compris celle de s'abstenir de tout déni de justice

3. constate que les demanderesses ont droit à compensation³⁵⁶ ;

4. ordonne à la République du Chili de payer aux demanderesses le montant de USD 10,132,690.18, portant intérêt au taux de 5%, composé annuellement, à compter du 11 avril 2002 jusqu'à la date d'envoi de la présente sentence ;

5. met à la charge de la défenderesse une contribution aux frais et dépens exposés par les demanderesses, d'un montant de USD 2,000,000,- (deux millions) ;

6. décide que les frais de procédure seront supportés par les parties dans la proportion de : 3/4 du montant total (soit USD 3,136,893.34) pour la défenderesse et 1/4 du montant total (soit 1,045,631.11) pour les demanderesses ; ordonne en conséquence à la défenderesse de payer aux demanderesses la somme de USD 1,045,579.35 ;

7. ordonne à la République du Chili de procéder au paiement dans un délai de 90 jours à compter de la date d'envoi de la présente sentence, des sommes figurant dans le présent dispositif (points 4, 5 et 6), faute de quoi le montant portera intérêts composés annuellement au taux de 5%, à compter de la date d'envoi de la présente sentence jusqu'à celle du parfait paiement ;

8. rejette toutes autres ou plus amples conclusions.

It is not in dispute between the Parties that the two passages in which the First Tribunal determines conduct by the Respondent falling short of the requirements of Article 4 of the BIT are to be found at paragraphs 653 - 674 of its First Award. As the ad hoc Committee puts the matter in its Decision on Annulment, citing the First Award:

57. Le raisonnement et la conclusion du Tribunal en ce qui concerne la violation par le Chili de l'article 4 de l'API sont bien illustrés par les paragraphes suivants de la Sentence. Le Comité les reprend in extenso :

653. La question se pose en particulier de savoir si le comportement des autorités chiliennes, législatives, administratives et judiciaires, peut ou non être considéré comme constituant un « déni de justice » et une violation du devoir d'accorder à l'investissement étranger une protection suffisante, soit plus précisément, un « traitement juste et équitable » au sens de l'article 4 (1) de l'API ainsi conçu : « Chaque Partie garantira dans son territoire, en accord avec sa législation nationale, un traitement juste et équitable aux investissements réalisés par des investisseurs de l'autre Partie, sous des conditions non moins favorables que pour ses investisseurs nationaux ».

[…]

658. Dans le contexte spécifique du présent litige, tel qu'il a été résumé dans la présente sentence dans sa partie Faits et dans les considérations juridiques qui précédent, l'application de la notion de « déni de justice » et celle de l'obligation de « traitement juste et équitable » n'appellent pas de longue analyse. Elles se laissent résumer à deux questions relativement simples :

• La première est celle de savoir si l'absence de toute décision par les juridictions chiliennes pendant une période de sept années (1995-2002), d'une part, et l'absence de réponse de la Présidence aux requêtes de M. Pey Casado, d'autre part, sont constitutives d'un déni de justice.

• La seconde est celle de savoir si les investissements reconnus par le Tribunal arbitral comme ayant été faits par M. Pey Casado ont bénéficiés du « traitement juste et équitable » prescrit par l'API.

659. Sur la première question, la réponse ne peut être que positive, au regard des faits établis et déjà retenus par le Tribunal arbitral, l'absence de toute décision par les tribunaux civils chiliens sur les prétentions de M. Pey Casado s'analysant en un déni de justice.

[...]

665. Sur la seconde question, celle de savoir si les investissements des demanderesses ont bénéficié d'un traitement juste et équitable, une réponse négative s'impose de l'avis du Tribunal arbitral, compte tenu des conclusions auxquelles il est parvenu précédemment aux termes de son appréciation des preuves et de son analyse juridique. En bref, il s'agit de la conclusion selon laquelle M. Pey Casado a bien démontré avoir procédé à des investissements et être propriétaire de biens meubles ou immeubles qui ont été confisqués par l'autorité militaire chilienne.

[…]

674. Dans le cas d'espèce, en résumé, en accordant des compensations - pour des raisons qui lui sont propres et sont restées inexpliquées - à des personnages qui, de l'avis du Tribunal arbitral, n'étaient pas propriétaires des biens confisqués, en même temps qu'elle paralysait ou rejetait les revendications de M. Pey Casado concernant les biens confisqués, la République du Chili a manifestement commis un déni de justice et refusé de traiter les demanderesses de façon juste et équitable.

• the existence of injury resulting from the original expropriation of the investment required no demonstration, since the Respondent had fixed its quantum in order to award it to persons other than the Claimants;

• the Claimants had not produced any proof, or at least any convincing proof, of any kind for the existence of damage caused by the facts falling within the competence of the First Tribunal ratione temporis ;

• in the absence of proof, and the unavailability in the circumstances of alternative expert evidence, the First Tribunal was empowered to make its own evaluation by reference to "objective elements" given that a quantum had been fixed by the Respondent (see above);

• this evaluation could not be of the damage suffered by reason of the original expropriation, but had instead to be of the damage resulting from the breach of the guarantee of fair and equitable treatment under the BIT;

• the object was to put the Claimants into the position they would have been in if the authorities of the Respondent had compensated the Claimants instead of third persons who (in the judgement of the First Tribunal) were not the owners of the assets in question; and

• it followed therefore that the amount awarded to these third persons was the correct measure of the damages.

• that the length of the Goss press case in the Santiago court could not have been the cause of any relevant injury to the Claimants, both because the value of the press became part of the Claimants' expropriation case in the original arbitration, and because the only bearing which the proceedings in that case was asserted to have on the Arbitration was via the Claimants' theory as to the nullity ex tunc of Decree No. 165, which leads back in turn to the rejected expropriation claim;

• that the Claimants likewise suffered no direct, or financially assessable, injury as a result of Decision No. 43, and that such disadvantage as the Claimants suffered was the direct consequence of their own voluntary decision not to participate in the domestic compensation scheme.³⁷⁷

Dans le cas d'espèce, en résumé, en accordant des compensations - pour des raisons qui lui sont propres et sont restées inexpliquées - à des personnages qui, de l'avis du Tribunal arbitral, n'étaient pas propriétaires des biens confisqués, en même temps qu'elle paralysait ou rejetait les revendications de M. Pey Casado concernant les biens confisqués, la République du Chili a manifestement commis un déni de justice et refusé de traiter les demanderesses de façon juste et équitable.

All these paragraphs come from the un-annulled part of the First Award. The present Tribunal completes this summary of the key passages in the First Award by noting in addition (though on the basis indicated in paragraph 223 above) the First Tribunal's indication (paragraph 675) of its finding that Mr Pey Casado was the owner of the confiscated property, and its indication (paragraph 677) of the recognition by the Chilean State of the illegality of the original confiscation and the accompanying duty to provide compensation, disputing only to whom it should be paid. The Tribunal notes also, though on a somewhat different, and non-factual level, the First Tribunal's holding, in paragraph 680, that the existence of damage "résultant de la confiscation" [emphasis added] follows automatically by itself, as well as from the decision (sc. Decision No. 43) to award compensation in favour of other persons.

a) that the original expropriation of El Clarín and the related assets belonging to Mr Pey Casado was consummated in 1975 and consequently lies outside the scope of the BIT; that all arguments based on or arising out of the expropriation may not be taken into consideration, except in so far as they constitute factual background to matters that are properly within the scope of the dispute under the BIT; and that the Claimants' theory of a ‘continuing act' linking post-BIT conduct to pre-BIT conduct must be rejected;

b) that the issues properly within the scope of the dispute under the BIT, namely the Claimants' allegations of breach of Article 4 of the BIT (fair and equitable treatment) resulting from the delays in the Goss press litigation and from Decision No. 43, are distinct, both factually and legally, from the original expropriation; and

c) that there was a breach of the guarantee of fair and equitable treatment under Article 4, which consisted of the totality of the conduct of the Chilean authorities resulting in the seven-year delay in the Goss press litigation and Decision No. 43, and manifested itself in the award of compensation to persons who were not the owners of the assets confiscated while Mr Pey Casado's claims were rejected.

a) that, beyond its description, in somewhat Delphic terms, of what constituted the breach of the guarantee of fair and equitable treatment, the First Tribunal made no finding as to what injury was caused to the Claimants by that breach or its constitutive elements;

b) that it remains therefore outstanding to determine the nature and extent of that injury;

c) that, having failed to meet the corresponding burden of proof in the original arbitration, the burden rested with the Claimants to do so now in these resubmission proceedings;

d) that any assessment of injury and damage based on the original expropriation is inconsistent with the First Award and must therefore be rejected.

In the view of the Tribunal, two facts stand out from this summary account. The first is that no attempt was made to advance, or to justify, a specific claim that moral damage had been suffered by the Foundation; this claim can therefore immediately be set aside, without any further investigation as to whether moral damages are in fact available to corporate or like entities, as opposed to natural persons. The second is that the claim to damage caused by the Respondent's conduct in the arbitral proceedings must also fall in limine, for the reasons given in paragraph 216 above. But the most decisive factor of all is that a claim to damages of a moral character does not escape the burden of proof resting on a claimant, as described in paragraphs 205-206 above. The Tribunal notes, in this context, the clear expression of view by the First Tribunal on two occasions, at paragraphs 689 and 704 of the First Award, that the Claimants had simply failed to meet this burden, and that a mere likelihood that damage might have been suffered does not suffice. Admittedly, both paragraphs fall within Section VIII of the First Award, but, as they relate to matters of factual evidence and proof, they are not tainted by the criticisms of the ad hoc Committee relating to the assessment of material damages; and they accord, moreover, entirely with the opinion of the present Tribunal on the basis of the written and oral submissions made to it by the Claimants. The claim to moral damages must therefore be rejected. Had the Tribunal found the claim to material damage to have been established, it would have been prepared to consider the Claimants' subsidiary and alternative submission that moral injury (assuming it to be made out) was a factor to be taken into account in assessing the appropriate reparation for the breach of fair and equitable treatment; but, as the claim to material damages has itself been rejected, this submission, too, must fail.

Qu'il condamne l'Etat du Chili à supporter l'intégralité des frais de la présente procédure, y compris les frais et honoraires des Membres du Tribunal, les frais de procédure (utilisation des installations, frais de traduction, etc.) et, en conséquence, qu'il condamne l'Etat du Chili à rembourser, dans les 90 jours qui suivent l'envoi de la Sentence à intervenir, les parties Demanderesses les frais et coûts de procédure avancés par elles et qu'il rembourse aux parties Demanderesses l'ensemble des frais et honoraires des avocats, experts et autres personnes ayant été appelées à intervenir pour la défense de leurs intérêts, portant, en cas de non remboursement dans ce délai, intérêts capitalisés mensuellement à un taux de 10% à compter de la date de la Sentence à intervenir jusqu'à complet paiement, ou à toutes autres sommes que le Tribunal arbitral estimera justes et équitables.³⁸³

In their Statement of Costs dated 18 May 2015 and Supplemental Statement of Costs dated 29 May 2015, the Claimants have submitted the following claims:

En conséquence, et conformément au paragraphe 501 (9) du Mémoire en Réplique des Demanderesses du 9 janvier 2015, les parties Demanderesses sollicitent du Tribunal arbitral qu'il condamne la République du Chili à leur verser sur le compte bancaire de la Fondation demanderesse indiquée par celle-ci, dans un délai de 90 jours à compter de la reddition de la Sentence à intervenir, le montant de :

(1) 3,159,743.24 euros (T.V.A. 21 % comprise) correspondant aux frais et honoraires du Cabinet Garcés y Prada, Abogados;

(2) 1,132,231.59 euros correspondants aux frais et honoraires du Cabinet Gide Loyrette Nouel ;

(3) 241,159.77 euros correspondant aux frais et honoraires du Cabinet Accuracy;

(4) 1,692 dollars US correspondant aux frais et honoraires du Cabinet d'experts Aninat, de Santiago du Chili

(5) 33,332.19 euros de frais de traduction

(6) l'ensemble des sommes payées au Centre par les parties Demanderesses dans le cadre de la nouvelle soumission concernant l'affaire No. ARB-98-2 telle qu'elles seront établies par le Centre ;

(7) ou à toute autre somme que le Tribunal arbitral jugera équitable ;

(8) rejette les demandes de la République du Chili au titre du remboursement de ses dépenses et frais.

Les Parties Demanderesses sollicitent du Tribunal qu'il ordonne qu'à défaut de paiement de ces sommes par la République du Chili dans le délai de 90 jours ci-dessus indiqué, ces sommes porteront intérêts à un taux de 10%, capitalisés mensuellement, à compter de la date de la Sentence à intervenir, jusqu'à complet paiement.

Claimants' consistent pattern of accusing Chile's counsel of bad faith at every turn; making such accusations public by uploading all of their pleadings and most of their correspondence on their website; belaboring every procedural point; appealing every issue (see, e.g., Claimants' 10 submissions on Chile's arbitrator appointment) have all acutely exacerbated the dispute and have implied a massive waste of time and resources. As a result of Claimants' vexatious litigation tactics, and the fact that the entirety of Claimants' Resubmission claims are impermissible in the first place, the Tribunal should impose on Claimants the obligation to cover all of Chile's costs and expenses, including legal and expert fees. It would certainly seem inappropriate— in light of the foregoing discussion — to award costs to Claimants, as they have requested.³⁸⁴

[...]

For the reasons set forth in this Rejoinder, as well as those articulated in the Counter-Memorial, Chile respectfully requests that the Tribunal:

[…]

b. Particularly in light of Claimants' vexatious tactics, misleading and repetitive argumentation, and defamatory accusations, grant Chile a full award of any and all expenses and costs incurred during this Resubmission Proceeding (including legal fees and expert fees);³⁸⁵

In its Costs Quantification dated 29 May 2015, the Respondent has submitted the following claims:

These costs amount to (in US$):

1) That Ms Coral Pey Grebe cannot be regarded as a claimant in her own right in these resubmission proceedings;

2) That, as has already been indicated by the First Tribunal, its formal recognition of the Claimants' rights and its finding that they were the victims of a denial of justice constitutes in itself a form of satisfaction under international law for the Respondent's breach of Article 4 of the BIT;³⁸⁷

3) That the Claimants, bearing the relevant burden of proof, have failed to prove any further quantifiable injury to themselves caused by the breach of Article 4 as found by the First Tribunal in its Award;

4) That the Tribunal cannot therefore make any award to the Claimants of financial compensation on this account;

5) That the Claimants' subsidiary claim on the basis of unjust enrichment is without legal foundation;

6) That there are no grounds in the circumstances of the case for the award of moral damages either to Mr Pey Casado or to the Foundation;

7) That the arbitration costs of these resubmission proceedings are to be shared in the proportion of three quarters to be borne by the Claimants and one quarter by the Respondent, with the result that the Claimants shall reimburse to the Respondent the sum of US$159,509.43;

8) That all other claims are dismissed.