In arbitral proceedings, the Russian Federation was ordered to pay damages to HVY for breach of its obligations under the Energy Charter Treaty (hereinafter: ECT).² The Russian Federation brought a claim for setting aside the relevant arbitral awards (hereinafter also the 'Yukos Awards’) before the Dutch court. The District Court awarded the claim on the grounds of the absence of a valid arbitration agreement. On appeal, the Court of Appeal annulled the District Court's judgment and as yet rejected the Russian Federation's claims. The Russian Federation has lodged an appeal in cassation against the judgment of the Court of Appeal.

a) arbitration at the International Centre for Settlement of Investment Disputes (ICSID) in Washington, on the basis of the ICSID Convention¹¹, provided that both ECT states concerned are parties to the ICSID Convention (or, if one of the states concerned is party to the ICSID Convention, on the basis of the Additional Facility Rules to that Convention);

b) arbitration by a single arbitrator or an ad hoc tribunal established in accordance with the Arbitration Rules of the United Nations Commission on International Trade Law (UNCITRAL), as has been done in the present case;

c) arbitration at the arbitration institute of the Stockholm Chamber of Commerce (SCC).

The arbitral tribunal appointed pursuant to the UNCITRAL Arbitration Rules (hereinafter: the Tribunal) ruled in three separate Interim Awards on Jurisdiction and Admissibility of 30 November 2009 (hereinafter: the Interim Awards) on a number of preliminary defences raised by the Russian Federation, including in relation to the Tribunal's jurisdiction. In the Interim Awards, the Tribunal rejected certain defences on jurisdiction and admissibility and ruled with respect to other preliminary defences that the decision on them would be stayed until the merits phase of the proceedings.

In three separate Final Awards of 18 July 2014,²³ the Tribunal rejected the Russian Federation's remaining defences on jurisdiction and/or admissibility, found that the Russian Federation had breached its obligations under Article 13(1) ECT, and ordered the Russian Federation to pay HVY damages amounting to USD 8,203,032,751 (to VPL), USD 1,846,000,687 (to YUL) and USD 39,971,834,360 (to Hulley), respectively, plus interest and costs. The Tribunal ruled, briefly stated, that the Russian Federation, by taking a number of tax and recovery measures against Yukos, had aimed at the bankruptcy of Yukos, with no other purpose than to eliminate Mr Mikhail Khodorkovsky, the chairman of Yukos and one of its shareholders (hereinafter: Khodorkovsky), as a potential political opponent of President Putin and to acquire Yukos' assets.

By separate summons of 10 November 2014, the Russian Federation summoned Hulley, VPL and YUL before the District Court of The Hague and requested the District Court to set aside the Interim Awards and Final Awards rendered by the Tribunal in each of their cases. These three cases were consolidated by the District Court at the request of the Russian Federation.

On 20 April 2016, in one judgment rendered in the three consolidated cases, the District Court set aside the Interim Awards and the Final Awards because of the absence of a valid arbitration agreement.²⁴ HVY filed an appeal against this judgment with the Court of Appeal of The Hague.

According to the Court of Appeal, HVY's grounds of appeal were therefore well-founded, in part, and the District Court's reasoning could not justify its decision that no valid arbitration agreement had been concluded (para. 4.9.1). Given the devolutive effect of appeal, the Court of Appeal assessed whether the Russian Federation's other statements in support of its claim that the Tribunal had no jurisdiction are well-founded, i.e. the statements pertaining to (i) the interpretation of Article 1(6) and (7) ECT²⁸ (the terms "investment" and "investor"), (ii) the interpretation of Article 1(6) and (7) ECT (the legality of the investments), (iii) the taxation measures imposed by the Russian Federation, which are a legitimate exercise of the authority of the Russian Federation falling within the scope of Article 21(1) ECT.

The Court of Appeal concluded that none of the grounds argued by the Russian Federation for the absence of a valid arbitration agreement support such a conclusion, so that there is no reason to set aside the Yukos Awards pursuant to Article 1065(1)(a) DCCP (para. 5.3.1).

In paras. 6.6.1-6.6.15, the Court of Appeal addressed the Russian Federation's argument that the Yukos Awards should be set aside due to the disproportionate involvement of Martin Valasek, the assistant to the Tribunal, in their drafting (para. 6.6.1). According to the Russian Federation, this involvement violated the principle that arbitrators must personally perform the task assigned to them, meaning that the Tribunal had failed to comply with its mandate (Article 1065(1)(c) DCCP). In addition, Valasek's involvement is said to mean that there effectively had been a "fourth arbitrator", meaning that the Tribunal's composition was inconsistent with the applicable rules (Article 1065(1)(d) DCCP).

The Court of Appeal rejected this argument. Although the Court of Appeal presumed that Valasek had made significant contributions to the drafting of parts of the text (para. 6.6.5), this did not mean that he had independently taken decisions which are part of the essential task of the arbitrators (para. 6.6.10). The fact that the Final Awards were signed by the three arbitrators implies, that it was they who rendered them, which means there was not an even number of arbitrators (para. 6.6.13). If the Russian Federation's statement that Valasek was only introduced as an assistant and contact person is assumed, by way of presumption, to be correct, it can be concluded that the Tribunal failed to fully inform the parties on this point of the nature of Valasek's work. However, under the circumstances, this does not constitute such a serious violation of the mandate that it should lead to the setting aside of the arbitral awards (para. 6.6.14.2).

The Court of Appeal concluded that HVY's grounds of appeal succeeded at least in part and that the Tribunal had jurisdiction to hear and decide on HVY’s claims. The other grounds for setting aside put forward by the Russian Federation cannot lead to the setting aside of the Yukos Awards (para. 10.1). The Court of Appeal annulled the judgment of the District Court and, adjudicating the matter anew, rejected the Russian Federation's claims (para. 10.3 and operative part).

The Russian Federation filed an application in the context of its appeal in cassation for (inter alia) the suspension of enforcement of the Yukos Awards and for HVY to be ordered to provide security. By decision of 25 September 2020, the Supreme Court decided that it has jurisdiction to hear this application.²⁹ By decision of 4 December 2020, the Supreme Court rejected the Russian Federation's application.³⁰

Article 45 Provisional application

1. Each signatory agrees to apply this Treaty provisionally pending its entry into force for such signatory in accordance with Article 44, to the extent that such provisional application is not inconsistent with its constitution, laws or regulations.

2. a) Notwithstanding paragraph 1 any signatory may, when signing, deliver to the Depository a declaration that it is not able to accept provisional application. The obligation contained in paragraph 1 shall not apply to a signatory making such a declaration. Any such signatory may at any time withdraw that declaration by written notification to the Depository.

b) Neither a signatory which makes a declaration in accordance with subparagraph a nor Investors of that signatory may claim the benefits of provisional application under paragraph 1.

c) Notwithstanding subparagraph a), any signatory making a declaration referred to in subparagraph a shall apply Part VII provisionally pending the entry into force of the Treaty for such signatory in accordance with Article 44, to the extent that such provisional application is not inconsistent with its laws or regulations.

3. a) Any signatory may terminate its provisional application of this Treaty by written notification to the Depository of its intention not to become a Contracting Party to the Treaty. Termination of provisional application for any signatory shall take effect upon the expiration of 60 days from the date on which such signatory’s written notification is received by the Depositary.

b) In the event that a signatory terminates provisional application under subparagraph a, the obligation of the signatory under paragraph 1 to apply Parts III and V with respect to any Investments made in its Area during such provisional application by Investors of other signatories shall nevertheless remain in effect with respect to those Investments for twenty years following the effective date of termination, except as otherwise provided in subparagraph c).

c) Subparagraph b) shall not apply to any signatory listed in Annex PA. A signatory shall be removed from the list in Annex PA effective upon delivery to the Depositary of its request therefor.

4. Pending the entry into force of this Treaty the signatories shall meet periodically in the provisional Charter Conference, the first meeting of which shall be convened by the provisional Secretariat referred to in paragraph 5 not later than 180 days after the opening date for signature of the Treaty as specified in Article 38.

5. The functions of the Secretariat shall be carried out on an interim basis by a provisional Secretariat until the entry into force of this Treaty pursuant to Article 44 and the establishment of a Secretariat.

6. The signatories shall, in accordance with and subject to the provisions of paragraph 1 or subparagraph 2c as appropriate, contribute to the costs of the provisional Secretariat as if the signatories were Contracting Parties under Article 37(3). Any modifications made to Annex B by the signatories shall terminate upon the entry into force of this Treaty.

7. A state or Regional Economic Integration Organization which, prior to this Treaty's entry into force, accedes to the Treaty in accordance with Article 41 shall, pending the Treaty's entry into force, have the rights and assume the obligations of a signatory under this Article.

Artikel 45 Voorlopige toepassing

1. Elke Ondertekenende Partij stemt ermee in dit Verdrag voorlopig toe te passen in afwachting van de inwerkingtreding voor deze Ondertekenende Partij krachtens artikel 44, voor zover deze voorlopige toepassing niet strijdig is met haar constitutie, wetten of voorschriften.

2. a. Ongeacht het eerste lid kan een Ondertekenende Partij op het tijdstip van ondertekening bij de Depositaris een verklaring indienen dat zij niet kan instemmen met voorlopige toepassing. De in het eerste lid vermelde verplichting geldt niet voor een Ondertekenende Partij die een dergelijke verklaring aflegt. Die Ondertekenende Partij kan te allen tijde haar verklaring intrekken door middel van een schriftelijke kennisgeving aan de Depositaris.

b. Een Ondertekenende Partij die een verklaring aflegt als bedoeld in het tweede lid, letter a, en investeerders van die Ondertekenende Partij kunnen geen aanspraak maken op de voordelen van voorlopige toepassing krachtens het eerste lid.

c. Ongeacht het tweede lid, letter a, moet een Ondertekenende Partij die een verklaring aflegt als bedoeld in het tweede lid, letter a, Deel Vil voorlopig toepassen in afwachting van de inwerkingtreding van het Verdrag voor de Ondertekenende Partij overeenkomstig artikel 44, voor zover die voorlopige toepassing niet strijdig is met haar wetten of voorschriften.

3. a. Een Ondertekenende Partij kan de voorlopige toepassing van dit Verdrag beëindigen door middel van een schriftelijke kennisgeving aan de Depositaris van haar voornemen geen partij bij het Verdrag te worden. De beëindiging van de voorlopige toepassing wordt voor een Ondertekenende Partij van kracht na het verstrijken van zestig dagen na de datum waarop de schriftelijke kennisgeving van die Ondertekenende Partij door de Depositaris is ontvangen.

b. Ingeval een Ondertekenende Partij de voorlopige toepassing van dit Verdrag beëindigt overeenkomstig het derde lid, letter a, blijft de krachtens het eerste lid op die Ondertekenende Partij rustende verplichting om Deel lil en Deel V toe te passen ten aanzien van investeringen die tijdens die voorlopige toepassing op haar grondgebied zijn gedaan door investeerders van andere Ondertekenende Partijen, evenwel van toepassing voor die investeringen gedurende twintig jaar na de datum van beëindiging, tenzij anders bepaald in het derde lid, letter c.

c. Het bepaalde in het derde lid, letter b, geldt niet voor de in bijlage PA vermelde Ondertekenende Partijen. Een Ondertekenende Partij wordt van de lijst in bijlage PA geschrapt zodra zij bij de Depositaris een verzoek daartoe indient.

4. In afwachting van de inwerkingtreding van dit Verdrag komen de Ondertekenende Partijen op geregelde tijdstippen bijeen in het kader van de voorlopige Conferentie van het Handvest, waarvan de eerste vergadering uiterlijk 180 dagen na de in artikel 38 vermelde datum van openstelling voor ondertekening van dit Verdrag door het in het vijfde lid bedoelde voorlopige Secretariaat wordt bijeengeroepen.

5. Tot de inwerkingtreding van dit Verdrag overeenkomstig artikel 44 en de oprichting van een Secretariaat worden de taken van het Secretariaat op tijdelijke basis verricht door een voorlopig Secretariaat.

6. In overeenstemming met dan wel onder voorbehoud van de bepalingen van het eerste lid of het tweede lid, letter c, al naar gelang het geval, dragen de Ondertekenende Partijen bij in de kosten van het voorlopige Secretariaat alsof zij Verdragsluitende Partijen in de zin van artikel 37, derde lid, waren. Eventuele door de Ondertekenende Partijen in bijlage B aangebrachte wijzigingen vervallen bij de inwerkingtreding van dit Verdrag.

7. Een Staat of regionale organisatie voor economische integratie die, vóór de inwerkingtreding van dit Verdrag, overeenkomstig artikel 41 tot het Verdrag toetreedt, heeft in afwachting van de inwerkingtreding van het Verdrag de rechten en verplichtingen van een Ondertekenende Partij krachtens dit artikel.

"to ensure that, if a party wishes to contest the jurisdiction of the arbitral tribunal because of the absence of a valid arbitration agreement, the arbitral tribunal can make a decision on the matter at an early stage of the proceedings, thus avoiding as far as possible unnecessary procedural steps if a reliance made later (in the arbitral proceedings or before the ordinary courts) on the absence of a valid arbitration agreement would nevertheless lead to the decision that the arbitral tribunal has no jurisdiction."⁷⁰

Whether new factual or legal statements may be put forward in the setting-aside proceedings will have to be assessed in each specific case, also in view of the requirements of due process.⁷¹

"Recalling that all signatories to the Concluding Document of the Hague Conference undertook to pursue the objectives and principles of the European Energy Charter and implement and broaden their cooperation as soon as possible by negotiating in good faith an Energy Charter Treaty and Protocols, and desiring to place the commitments contained in that Charter on a secure and binding international legal basis".

"The meaning of the words 'not inconsistent' follows from the Court of Appeal’s interpretation of the Limitation Clause. This interpretation concerns whether national laws or regulations exist that exclude provisional application for certain treaty provisions or types or categories of such provisions. If the latter is the case, provisional application of those treaty provisions, or types or categories of such provisions, is 'inconsistent' with national law."

"30. The Aarhus Convention was signed by the Community and subsequently approved by Decision 2005/370. Therefore, according to settled case-law, the provisions of that convention now form an integral part of the legal order of the European Union (see, by analogy, Case C-344/04 IATA and ELFAA [2006] ECR I-403, paragraph 36, and Case C-459/03 Commission v Ireland [2006] ECR I-4635, paragraph 82). Within the framework of that legal order the Court therefore has jurisdiction to give preliminary rulings concerning the interpretation of such an agreement (see, inter alia, Case 181/73 Haegeman [1974] ECR 449, paragraphs 4 to 6, and Case 12/86 Demirel (1987] ECR 3719, paragraph 7).

31. Since the Aarhus Convention was concluded by the Community and all the Member States on the basis of joint competence, it follows that where a case is brought before the Court in accordance with the provisions of the EC Treaty, in particular Article 234 EC thereof, the Court has jurisdiction to define the obligations which the Community has assumed and those which remain the sole responsibility of the Member States in order to interpret the Aarhus Convention (see, by analogy, Joined Cases C-300/98 and C-392/98 Dior and Others [2000] ECR I-11307, paragraph 33, and Case C-431/05 Merck Genéricos -Produtos Farmacêuticos [2007] ECR I-7001, paragraph 33).

32. Next, it must be determined whether, in the field covered by Article 9(3) of the Aarhus Convention, the European Union has exercised its powers and adopted provisions to implement the obligations which derive from it. If that were not the case, the obligations deriving from Article 9(3) of the Aarhus Convention would continue to be covered by the national law of the Member States. In those circumstances, it would be for the courts of those Member States to determine, on the basis of national law, whether individuals could rely directly on the rules of that international agreement relevant to that field or whether the courts must apply those rules of their own motion. In that case, EU law does not require or forbid the legal order of a Member State to accord to individuals the right to rely directly on a rule laid down in the Aarhus Convention or to oblige the courts to apply that rule of their own motion (see, by analogy, Dior and Others, paragraph 48 and MerckGenéricos - Produtos Farmacêuticos, paragraph 34).

33. However, if it were to be held that the European Union has exercised its powers and adopted provisions in the field covered by Article 9(3) of the Aarhus Convention, EU law would apply and it would be for the Court of Justice to determine whether the provision of the international agreement in question has direct effect.

34. Therefore, it is appropriate to examine whether, in the particular field into which Article 9(3) of the Aarhus Convention falls, the European Union has exercised its powers and adopted provisions to implement obligations deriving from it (see, by analogy, MerckGenéhcos - Produtos Farmacéuticos. paragraph 39).

35. In that connection, it must be observed first of all, that, in the field of environmental protection, the European Union has explicit external competence pursuant to Article 175 EC, read in conjunction with Article 174(2) EC (see, Commission v Ireland, paragraphs 94 and 95).

36. Furthermore, the Court has held that a specific issue which has not yet been the subject of EU legislation is part of EU law. where that issue is regulated in agreements concluded by the European Union and the Member State and it concerns a field in large measure covered by it (see, by analogy, Case C-239/03 Commission v France [2004] ECR I-9325, paragraphs 29 to 31)."

(my italics, Advocate General)

"Must Article 1(6)of the Energy Charter Treaty be interpreted as meaning that a claim which arose from a contract for the sale of electricity and which did not involve any contribution on the part of the investor in the host State can constitute an 'investment' within the meaning of that article?

Must Article 26(1) of the Energy Charter Treaty be interpreted as meaning that the acquisition, by an investor of a Contracting Party, of a claim established by an economic operator which is not from one of the States that are Parties to that Treaty constitutes an investment?

Must Article 26(1) of the Energy Charter Treaty be interpreted as meaning that a claim held by an investor, which arose from a contract for the sale of electricity supplied at the border of the host State, can constitute an investment made in the area of another Contracting Party, in the case where the investor does not carry out any economic activity in the territory of that latter Contracting Party?"

Article 1 Definitions

As used in this Treaty:

(...)

6. "Investment" means every kind of asset, owned or controlled directly or indirectly by an Investor and includes:

a) tangible and intangible, and movable and immovable, property, and any property rights such as leases, mortgages, liens, and pledges;

b) a company or business enterprise, or shares, stock, or other forms of equity participation in a company or business enterprise, and bonds and other debt of a company or business enterprise:

c) claims to money and claims to performance pursuant to contract having an economic value and associated with an Investment;

d) Intellectual Property;

e) Returns;

f) any right conferred by law or contract or by virtue of any licences and permits granted pursuant to law to undertake any Economic Activity in the Energy Sector.

(...)

7. "Investor" means:

a) with respect to a Contracting Party:

(i) a natural person having the citizenship or nationality of or who is permanently residing in that Contracting Party in accordance with its applicable law;

(ii) company or other organization organized in accordance with the law applicable in that Contracting Party;

b) with respect to a "third state", a natural person, company or other organization which fulfils, mutatis mutandis, the conditions specified in subparagraph a) for a Contracting Party;

In the Dutch translation:

Artikel 1 Definities

In dit Verdrag wordt verstaan onder:

(...)

6. "investering": elke vorm van activa die een investeerder in eigendom heeft of waarover hij direct of indirect zeggenschap heeft, met inbegrip van:

a. lichamelijke en onlichamelijke en roerende en onroerende zaken alsook andere rechten, zoals huur-, hypotheek-, retentie- en pandrechten;

b. een vennootschap of onderneming, of aandelen of andere vormen van vermogensdeelneming in, en obligaties en andere schuldbewijzen van een vennootschap of onderneming;

c. aanspraken op geld en aanspraken op prestaties volgens een contract met een economische waarde en in verband met een investering;

d. intellectuele eigendom;

e. opbrengsten;

f. een bij wet of contract of uit hoofde van overeenkomstig de wet verleende licenties en vergunningen verleend recht een economische activiteit in de energiesector te ondernemen.

(...)

7. "investeerders":

a. van een Verdragsluitende Partij,

i. natuurlijke personen die het staatsburgerschap of de nationaliteit bezitten van of permanent verblijven op het grondgebied van die Verdragsluitende Partij conform haar toepasselijke wetgeving;

ii. vennootschappen of andere organisaties opgericht conform op het grondgebied van die Verdragsluitende Partij toepasselijke wetgeving;

b. uit een derde land, natuurlijke personen, vennootschappen of andere organisaties die mutatis mutandis voldoen aan de onder a. aan Verdragsluitende Partijen gestelde voorwaarden;

A special meaning shall be given to a term if it is established that the parties so intended.

A term from a treaty can therefore be understood as bearing a special (as opposed to an ordinary) meaning if it has been established that the contracting parties intended to give that term a special meaning. The most obvious evidence of such an intention is the inclusion of a definition.¹¹¹ It is therefore possible for a treaty to give a certain term a definition that differs from the term's ordinary meaning. In that case, interpretation must be based on that definition and not on the ordinary meaning, as evidenced by Article 31(4) VCLT. The Court of Appeal was therefore right in this case to use the definition of the term 'investment' in Article 1(6) ECT as a basis. The case law referred to in the ground is not relevant, as it does not relate to the ECT but to other investment treaties and to the ICSID Treaty.¹¹² In so far as it would even be possible to derive any ordinary meaning of the term 'investment' from the case law in question, that meaning would not apply to the ECT, as that treaty has its own definition of the term 'investment'. The complaints fail for this reason.

Article 10 Promotion, protection and treatment of investments

2. Each Contracting Party shall endeavour to accord to Investors of other Contracting Parties, as regards the Making of Investments in its Area, the Treatment described in paragraph 3.

3. For the purposes of this Article, "Treatment" means treatment accorded by a Contracting Party which is no less favourable than that which it accords to its own Investors or to Investors of any other Contracting Party or any third state, whichever is the most favourable.

Artikel 10 Bevordering, bescherming en behandeling van investeringen

2. Elke Verdragsluitende Partij streeft ernaar investeerders van andere Verdragsluitende Partijen wat betreft het doen van investeringen op haar grondgebied de in het derde lid omschreven behandeling toe te kennen.

3. In dit artikel wordt onder "behandeling" verstaan een behandeling toegekend door een Verdragsluitende Partij die niet minder gunstig is dan die welke zij toekent aan haar eigen investeerders of aan de investeerders van een andere Verdragsluitende Partij of een derde staat, al naar gelang welke behandeling het gunstigst is.

As argued in the ground, this Article does indeed distinguish between a Contracting Party's own investors and investors of any other Contracting Party or any third country. In that sense, this provision only protects cross-border investments. However, it is not evident from the provision that different requirements should therefore be imposed on the international character of an investment or the nationality of an investor than the requirements ensuing from Article 1(6) and (7) ECT. The ground does not explain this in greater detail either.

"For greater clarity as to whether an Investment made in the Area of one Contracting Party is controlled, directly or indirectly, by an Investor of any other Contracting Party, control of an Investment means control in fact, determined after an examination of the actual circumstances in each situation. In any such examination, all relevant factors should be considered, including the Investor's

(a) financial interest, including equity interest, in the Investment;

(b) ability to exercise substantial influence over the management and operation of the Investment; and

(c) ability to exercise substantial influence over the selection of members of the board of directors or any other managing body.

Where there is doubt as to whether an Investor Controls, directly or indirectly, an Investment, an Investor claiming such control has the burden of proof that such control exists".

This Understanding builds on Article 1(6) ECT, which defines an investment as "every kind of asset, owned or controlled directly or indirectly by an Investor". The Understanding therefore offers the party applying the ECT further guidelines to determine who controls a certain investment. The Understanding plays no role when it Is clear that an asset is owned by an investor. As the Court of Appeal held in para. 5.1.7.4, it is established in this case that the Yukos shares are owned by HVY. There was therefore no reason to further investigate, on the basis of the Understanding, who controls the shares.

Each Contracting Party reserves the right to deny the advantages of this Part to:

1.a legal entity if citizens or nationals of a third state own or control such entity and if that entity has no substantial business activities in the Area of the Contracting Party in which it is organized;

(...).

In the Dutch translation:

Elke Verdragsluitende Partij behoudt zich het recht voor de voordelen van dit Deel te ontzeggen aan:

1. een rechtspersoon, indien staatsburgers of onderdanen van een derde staat eigenaar zijn van of zeggenschap hebben over een dergelijke rechtspersoon en indien die rechtspersoon geen wezenlijke zakelijke activiteiten heeft op het grondgebied van de Verdragsluitende Partij waar hij is opgericht, (...).

As the Court of Appeal held in para. 5.1.8.4, Article 17 ECT gives contracting states the right to deny the protection of a large part of the treaty to a precisely defined category of investors, i.e. investors who are established in a contracting state only on formal grounds, but are to a large extent materially linked to a non-contracting state.¹¹⁶ Contrary to the argument put forward in the complaint, Article 17 ECT does not provide that the protection of the ECT must be denied to such investors, but rather entails that, in principle, those investors are protected by the ECT unless a contracting state decides otherwise.¹¹⁷ Thus, Article 17 ECT does not contain a rule entailing that investments that are not genuinely international, but only international in formal terms, are not entitled to ECT protection.

"Since the 1990s (most of) the ECT provisions have not been revised. This became particularly problematic in the context of the ECT provisions on the protection of investment, which do not correspond to modern standards as reflected in the EU's reformed approach on investment protection. Those outdated provisions are no longer sustainable or adequate for the current challenges; yet it is today the most litigated investment agreement in the world."¹²²

In the European Council's negotiating directives the following can be read:

"The negotiations should bring the ECT provisions on investment protection in line with the modern standards of recently concluded agreements by the EU and its Member States and adjust the ECT to new political and economic global changes (including in the energy sector).

The Investment Protection standards under the Modernised ECT should continue to aim at a high level of investment protection, with provisions affording legal certainty for investors and investments of Parties in each other's market.

The modernised ECT should provide clear definitions of covered investments and investors. The definition of investor should explicitly exclude investors and businesses that are lacking substantive business activities in their country of origin, in order to clarify that mailbox companies cannot bring disputes under the ECT."¹²³

A Working Document dated 20 April 2020 includes the following proposal to amend Article 1(7) ECT:

(7) "Investor" means:

(a) with respect to a Contracting Party:

(i) a natural person having the citizenship or nationality of or who is permanently residing in that Contracting Party in accordance with its applicable law [Footnote 1] ;

(ii) a company or other organisation organised in accordance with the law applicable in that Contracting Party and engaged in substantive business activities [Footnote 2] in the territory of that Contracting Party;

[Footnote 1: (...)]

[Footnote 2: In line with its notification of the Treaty establishing the European Community to the WTO (WT/REG39/1), the European Union understands that the concept of "effective and continuous link" with the economy of a Member State of the European Union enshrined in Article 54 of the TFEU is equivalent to the concept of "substantive business activities"]'.¹²⁴

As the Court of Appeal held, part of the arbitral case law was rendered on the basis of the ICSID Convention. As I wrote in my introduction (no. 1.10), the ICSID Convention has its own scope of application. The ICSID Convention explicitly pertains to international investments, leaving it to the ICSID tribunals to flesh out this term in more detail. In practice, ICSID tribunals sometimes impose stricter requirements than the underlying investment treaties themselves, in particular with regard to the term 'investment' (see the discussion of ground 3.3).¹³⁰ These requirements may also be stricter than those of other (commercial) arbitral tribunals, which do not base their jurisdiction on the ICSID Convention.¹³¹ All this means that to the extent that in certain cases ICSID tribunals have imposed stricter requirements on the international nature of an investment than the ECT, this does not mean that the ECT should therefore also be interpreted more strictly. After all, those stricter requirements ensue from the ICSID Convention and/or from the underlying bilateral investment treaty. It also follows from the fact that all these treaties impose different requirements on the international nature of an investment¹³² that it is not possible to speak of a rule of customary international law.¹³³ Nor is it clear therefore that the ECT should be interpreted in accordance with the rules from the ICSID Convention or from other investment treaties. On the contrary, the various treaties have their own definitions, which in practice may also give rise to different outcomes. Incidentally, in the award in Plama/Bulgaria rendered on the basis of the ECT, the ICSID tribunal decided in line with Article 1(7) ECT (see no. 3.110 below).

The complaint fails for a lack of interest. This is because the challenged legal finding does not exclusively pertain to the question of whether Khodorkovsky et al. are the 'beneficial owners' of the Yukos shares and of HVY, but primarily relates to the question of whether this is relevant for the application of the ECT. In this finding, the Court of Appeal rejected the Russian Federation's statement that the ECT makes a distinction between the formal and material owner, in the sense that only the latter has legal standing (see para. 5.1.8.7). The Court of Appeal concluded that such a rule does not exist, and substantiated that conclusion by referring to Charanne/Spain. Incidentally, the ground does not challenge that conclusion.

As I have already noted, the ECT does not offer a real definition of the term, 'investment', but instead offers a non-exhaustive list of assets designated as such. This raises the question of how to assess whether assets that are not included in the list of Article 1(6) ECT should be considered an investment. In this respect, it has been noted in the literature that interpretations of the term 'investment' that developed outside the ECT, as in the context of the ICSID Treaty, could be of use.¹⁵⁰ There are also a number of decisions in ECT cases in which the definition of 'investor' was had been aligned with the Salini case law under the ICSID Treaty.¹⁵¹ For example, the majority of the arbitrators in Alapli/Turkey decided that the ECT requires "a meaningful contribution" by the investor in the host state. This was not the case in their opinion, because the claimant had not invested its own money, but had only acted as a "conduit".¹⁵² One of the other arbitrators challenged this view in a dissenting opinion on the ground that no such a criterion can be found in the ECT.¹⁵³ In other case law, it was explicitly decided that the Salini criteria cannot play a role in the context of the ECT. In Anatolie Stati and Others/Kazakhstan, the tribunal held that the ECT has an "extremely broad definition" of the term 'investment' and that if an asset is covered by Article 1(6) ECT, criteria developed in the context of another treaty no longer have any significance:

"806. (...) Guidelines and tests of criteria developed in this jurisprudence on the ICSID Convention and similar treaties, therefore, cannot be used as long as any right or activity is clearly covered by the wording of the above definition in ECT cases. Therefore, the so-called Salini test, controversial and much discussed both by the Parties in this case and otherwise in ICSID and similar arbitrations, even if applied as a flexible guideline rather than as a strict jurisdictional requirement, cannot be used for the definition of investment under the ECT or, likewise, in the present case. The Tribunal, thus, sees no need to examine the various criteria discussed for the Salini test."¹⁵⁴

"56. (...) Here, then, as elsewhere, the law, confronted with economic realities, has had to provide protective measures and remedies in the interests of those within the corporate entity as well as of those outside who have dealings with it: the law has recognized that the independent existence of the legal entity cannot be treated as an absolute. It is in this context that the process of "lifting the corporate veil" or "disregarding the legal entity" has been found justified and equitable in certain circumstances or for certain purposes. The wealth of practice already accumulated on the subject in municipal law indicates that the veil is lifted, for instance, to prevent the misuse of the privileges of legal personality, as in certain cases of fraud or malfeasance, to protect third persons such as a creditor or purchaser, or to prevent the evasion of legal requirements or of obligations."

The ICJ held that such an exception could also play a role under international law. The ICJ did however emphasise the exceptional nature of the process involved in lifting the veil.

"58. In accordance with the principle expounded above, the process of lifting the veil, being an exceptional one admitted by municipal law in respect of an institution of its own making, is equally admissible to play a similar role in international law. It follows that on the international plane also there may in principle be special circumstances which justify the lifting of the veil in the interest of shareholders."

In addition, although the ICSID tribunal held in these cases that acquiring shares in a foreign company in order to gain access to investment arbitration can be unacceptable, it also held that a distinction should be made between bona fide transactions, and that this is highly dependent on the circumstances of the case.¹⁶³ This ICSID case law therefore acknowledges, to a certain extent, the doctrine of piercing the corporate veil, although it has only applied it to date in a specific situation that does not appear in the case at issue in cassation.¹⁶⁴

Ground 3.5 argues that the Court of Appeal's interpretation is incompatible with EU law. According to the ground, the Court of Appeal should have submitted questions to the ECJ for a preliminary ruling on the interpretation of Article 1(6) and (7) and Article 26 ECT, addressing, in this respect, all the issues that have been raised in this case.

1) HVY acquired the shares in Yukos illegally, namely by manipulating auctions and paying bribes (ground 4.1.2);

2) Hulley and VPL were incorporated for the evasion of dividend tax, in which YUL also participated (ground 4.1.3);

3) Yukos evaded tax in the Russian Federation by using sham companies in free tax regions (ground 4.1.4);

4) HVY impeded the course of justice in response to this illegal conduct by destroying evidence and channelling funds abroad (ground 4.1.5).

Nor does arbitration case law give any indication that the Court of Appeal's decision is incorrect. It can be inferred from arbitral case law that the ECT contains an implicit legality requirement, but not that this should lead to a lack of jurisdiction on the part of the arbitral tribunal.¹⁶⁹ Relevant in this context are, inter alia, the decisions of the ICSID tribunal in the aforementioned case Plama v. Bulgaria, which the Court of Appeal discussed in para. 5.1.11.4. In those proceedings, Bulgaria argued that there was no investment within the meaning of the ECT because the investor had concealed who was controlling it. The tribunal rejected this argument in the context of the assessment of its jurisdiction, and decided that the definition in Article 1(6) ECT has been met if there is a right of ownership or a contractual claim, even if this right or entitlement is "defeasible".¹⁷⁰ The tribunal then went on to address this argument anyway in the assessment of the claim on the merits. There, the tribunal held, inter alia, that the ECT does not protect investments made in breach of the law. The claim was thereupon denied.¹⁷¹ This approach was also taken in the decision of the arbitral tribunal in the case Blusun v. Italy, which also involved the ECT (see para. 5.1.11.4), as well as in the decision of the arbitral tribunal in the case Anatolie Stati and others v. Kazakhstan.¹⁷²

Ground 4.4 is directed against paras. 9.8.5-9.8.10, in which the Court of Appeal rejected the Russian Federation's argument that the Final Awards were contrary to public policy because in consequence thereof, the aforementioned illegal acts are protected. After an introduction (in 4.4.1), the ground complains (in 4.4.2) that the Court of Appeal failed to recognise that it is contrary to national and international public policy to offer protection to treaty claims which concern investments that have been illegally acquired or exploited, or that the Court of Appeal's decision is at any rate insufficiently substantiated.

Ground 4.4.3 is directed against para. 9.8.8, in which the Court of Appeal discussed sub-chapter 1370 Final Awards. The Court of Appeal held that the Tribunal had decided that a number of the alleged illegal actions took place before HVY became a shareholder and that, as a result, they had been carried out by other parties, such as Bank Menatep and Khodorkovsky et al. According to the Court of Appeal, the Tribunal had thus decided nothing more than that Bank Menatep and Khodorkovsky et al. were other legal entities or persons than HVY, and that HVY could not be held liable for actions carried out by others before HVY became a shareholder. According to the Court of Appeal, this decision is correct and it has not been challenged by the Russian Federation, or at least not with sufficient substantiation. The ground complains that this decision is incomprehensible because the Russian Federation did indeed dispute the Tribunal’s decision with substantiation. The ground argues, furthermore, that the Court of Appeal should have investigated this issue ex officio because it concerns a possible violation of international public policy.

In discussing this complaint, I note that the Court of Appeal did not render its own decision in para. 9.8.8, but established what the Tribunal had held. The Court of Appeal was thus responding to a complaint by the Russian Federation about the Tribunal's decision. According to the Court of Appeal, that complaint lacks a factual basis because the Tribunal's decision needs to be interpreted differently. The Court of Appeal's finding that the Tribunal's decision is correct and has not been challenged was therefore rendered superfluously, which is what the Court of Appeal also held ("in so far as it could even be tested in the present setting-aside proceedings"). The ground already fails entirely for this reason. I note that the substance of the complaints also fails in all other respects. The Tribunal's decision, with which the Court of Appeal concurs (in the uncontested view of the Court of Appeal), merely implies that a number of the alleged illegal actions took place before HVY became a shareholder and that, as a result, these actions had been carried out by other parties, such as Bank Menatep and Khodorkovsky et al. The statements that the ground enumerates basically imply that HVY were controlled by Khodorkovsky et al. These statements do not themselves do anything to detract from the Tribunal's factual determination. The Court of Appeal was therefore able to decide that the Russian Federation had not challenged the decision, or at least not with sufficient substantiation. The ground (nos. 177 and 178) also points out certain alleged inconsistencies in the Final Awards. The Tribunal had allegedly taken into consideration at various places that Khodorkovsky et al. owned the shares in Yukos indirectly. In para. 9.8.9, the Court of Appeal has given an explanation for this, which entails that this was not incompatible with the determination that HVY and Khodorkovsky et al. are separate legal entities. That decision is not incomprehensible because the Court of Appeal was thus expressing that HVY need to be distinguished, as companies, from those who control them.

Article 21 Taxation

1. Except as otherwise provided in this Article, nothing in this Treaty shall create rights or impose obligations with respect to Taxation Measures of the Contracting Parties. In the event of any inconsistency between this Article and any other provision of the Treaty, this Article shall prevail to the extent of the inconsistency.

2. Article 7(3) shall apply to Taxation Measures other than those on income or on capital, except that such provision shall not apply to:

a) an advantage accorded by a Contracting Party pursuant to the tax provisions of any convention, agreement or arrangement described in subparagraph (7)(a)(ii); or

b) any Taxation Measure aimed at ensuring the effective collection of taxes, except where the measure of a Contracting Party arbitrarily discriminates against Energy Materials and Products originating in, or destined for the Area of another Contracting Party or arbitrarily restricts benefits accorded under Article 7(3).

3. Article 10(2) and (7) shall apply to Taxation Measures of the Contracting Parties other than those on income or on capital, except that such provisions shall not apply to:

a) impose most favoured nation obligations with respect to advantages accorded by a Contracting Party pursuant to the tax provisions of any convention, agreement or arrangement described in subparagraph (7)(a)(ii) or resulting from membership of any Regional Economic Integration Organization; or

b) any Taxation Measure aimed at ensuring the effective collection of taxes, except where the measure arbitrarily discriminates against an Investor of another Contracting Party or arbitrarily restricts benefits accorded under the Investment provisions of this Treaty.

4. Article 29(2) to (6) shall apply to Taxation Measures other than those on income or on capital.

5. a) Article 13 shall apply to taxes.

b) Whenever an issue arises under Article 13, to the extent it pertains to whether a tax constitutes an expropriation or whether a tax alleged to constitute an expropriation is discriminatory, the following provisions shall apply:

(i) The Investor or the Contracting Party alleging expropriation shall refer the issue of whether the tax is an expropriation or whether the tax is discriminatory to the relevant Competent Tax Authority. Failing such referral by the Investor or the Contracting Party, bodies called upon to settle disputes pursuant to Article 26(2)(c) or 27(2) shall make a referral to the relevant Competent Tax Authorities;

(ii) The Competent Tax Authorities shall, within a period of six months of such referral, strive to resolve the issues so referred. Where non-discrimination issues are concerned, the Competent Tax Authorities shall apply the non-discrimination provisions of the relevant tax convention or, if there is no non-discrimination provision in the relevant tax convention applicable to the tax or no such tax convention is in force between the Contracting Parties concerned, they shall apply the non-discrimination principles under the Model Tax Convention on Income and Capital of the Organisation for Economic Cooperation and Development;

(iii) Bodies called upon to settle disputes pursuant to Article 26(2)(c) or 27(2) may take into account any conclusions arrived at by the Competent Tax Authorities regarding whether the tax is an expropriation. Such bodies shall take into account any conclusions arrived at within the six-month period prescribed in subparagraph (b)(ii) by the Competent Tax Authorities regarding whether the tax is discriminatory. Such bodies may also take into account any conclusions arrived at by the Competent Tax Authorities after the expiry of the six-month period;

(iv) Under no circumstances shall involvement of the Competent Tax Authorities, beyond the end of the six-month period referred to in subparagraph (b)(ii), lead to a delay of proceedings under Articles 26 and 27.

6. For the avoidance of doubt, Article 14 shall not limit the right of a Contracting Party to impose or collect a tax by withholding or other means.

7. For the purposes of this Article:

a) The term "Taxation Measure" includes:

(i) any provision relating to taxes of the domestic law of the Contracting Party or of a political subdivision thereof or a local authority therein; and

(ii) any provision relating to taxes of any convention for the avoidance of double taxation or of any other international agreement or arrangement by which the Contracting Party is bound.

b) There shall be regarded as taxes on income or on capital all taxes imposed on total income, on total capital or on elements of income or of capital, including taxes on gains from the alienation of property, taxes on estates, inheritances and gifts, or substantially similar taxes, taxes on the total amounts of wages or salaries paid by enterprises, as well as taxes on capital appreciation.

c) A "Competent Tax Authority" means the competent authority pursuant to a double taxation agreement in force between the Contracting Parties or, when no such agreement is in force, the minister or ministry responsible for taxes or their authorized representatives.

d) For the avoidance of doubt, the terms "tax provisions" and "taxes" do not include customs duties.

In the Dutch translation:

Artikel 21 Belastingen

1. Behalve als bepaald in dit artikel worden door geen enkele bepaling van dit Verdrag rechten verleend of verplichtingen opgelegd met betrekking tot belastingmaatregelen van de Verdragsluitende Partijen. In geval van onverenigbaarheid van dit artikel met andere bepalingen van dit Verdrag heeft dit artikel, wat de onverenigbaarheid betreft, de voorrang.

2. Artikel 7, derde lid, is van toepassing op andere belastingmaatregelen dan belastingen op inkomen of kapitaal, met dien verstande dat de bepalingen van die artikelen niet van toepassing zijn op:

a. een voordeel dat een Verdragsluitende Partij heeft toegekend overeenkomstig de belastingbepalingen van een verdrag, overeenkomst of regeling als bedoeld in het zesde lid, letter a), onder ii), van dit artikel; of

b. een belastingmaatregel die ten doel heeft de doeltreffende inning van belastingen te waarborgen, behalve indien die maatregel van een Verdragsluitende Partij een willekeurige discriminatie tussen energiegrondstoffen en energieprodukten van een andere Verdragsluitende Partij of een willekeurige beperking van de krachtens de betreffende bepalingen van artikel 7, derde lid, toegekende voordelen inhoudt.

3. Artikel 10, tweede en zevende lid, zijn van toepassing op andere belastingmaatregelen van de Verdragsluitende Partijen dan belastingen op inkomen of kapitaal, met dien verstande dat geen van deze bepalingen:

a. ertoe strekt dat verplichtingen tot toepassing van het meestbegunstigingsbeginsel worden opgelegd met betrekking tot voordelen die een Verdragsluitende Partij heeft toegekend overeenkomstig de belastingbepalingen van een verdrag, overeenkomst of regeling als bedoeld in het zevende lid, letter a), onder ii), van dit artikel of als uitvloeisel van het lidmaatschap van een regionale organisatie voor economische integratie; of

b. van toepassing is op een belastingmaatregel die ten doel heeft de doeltreffende inning van belastingen te waarborgen, behalve indien de maatregel een willekeurige discriminatie tussen investeerders van de Verdragsluitende Partijen of een willekeurige beperking van de krachtens de investeringsbepalingen van dit Verdrag toegekende voordelen inhoudt.

4. Artikel 29, tweede tot en met zesde lid, is van toepassing op andere belastingmaatregelen dan belastingen op inkomen of kapitaal.

5. a. Artikel 13 is van toepassing op belastingen.

b. Wanneer in het kader van artikel 13 een geschil rijst, voor zover het betrekking heeft op de vraag of een belasting een onteigening vormt, dan wel of een belasting waarvan wordt beweerd dat deze een onteigening vormt, discriminerend is, geldt het volgende:

i. De investeerder of de Verdragsluitende Partij die aanvoert dat er sprake is van onteigening legt het geschil over de vraag of de maatregel een onteigening dan wel discriminerend is, voor aan de bevoegde belastingautoriteiten. Laat de investeerder of de Verdragsluitende Partij dit na, dan leggen de instanties die worden verzocht geschillen te beslechten overeenkomstig artikel 26, tweede lid, letter c), of artikel 27, tweede lid, het geschil voor aan de bevoegde belastingautoriteiten.

ii. De bevoegde belastingautoriteiten streven ernaar om het aldus voorgelegde geschil binnen een periode van zes maanden te regelen. Indien het gaat om een geschil inzake non-discriminatie, passen de bevoegde belastingautoriteiten de bepalingen inzake non- discriminatie van het relevante belastingverdrag toe, of passen zij, indien er geen non- discriminatiebepaling voorkomt in het op de belasting van toepassing zijnde relevante belastingverdrag of indien er geen belastingverdrag tussen de betrokken Verdragsluitende Partijen van kracht is, de non-discriminatiebeginselen overeenkomstig het modelverdrag van de OESO betreffende belastingen op inkomen en kapitaal toe.

iii. De instanties die worden verzocht geschillen te regelen overeenkomstig artikel 26, tweede lid, letter c), of artikel 27, tweede lid, kunnen rekening houden met eventuele conclusies van de bevoegde belastingautoriteiten over de vraag of de belasting een onteigening is. Die instanties houden rekening met eventuele binnen de bij letter b), onder ii), voorgeschreven termijn van zes maanden door de bevoegde belastingautoriteiten getrokken conclusies over de vraag of de belasting discriminerend is. Deze instanties kunnen ook rekening houden met eventuele na het verstrijken van de voorgeschreven periode van zes maanden door de bevoegde belastingautoriteiten getrokken conclusies.

iv. In geen geval mag de betrokkenheid van de bevoegde belastingautoriteiten na het einde van de bij letter b), onder ii), bedoelde periode van zes maanden leiden tot een vertraging van de procedures ingevolge de artikelen 26 en 27.

6. Voor alle duidelijkheid wordt bepaald dat artikel 14 het recht van een Verdragsluitende Partij om een belasting op te leggen of te innen via bronheffing of andere middelen niet beperkt.

7. Voor de toepassing van dit artikel:

a. omvat de term "belastingmaatregel":

i. de bepalingen betreffende belastingen van de interne wetgeving van de Verdragsluitende Partij of van een staatsrechtelijke onderverdeling of een plaatselijke autoriteit ervan; en

ii. de bepalingen betreffende belastingen van verdragen ter voorkoming van dubbele belasting en van internationale overeenkomsten of regelingen waaraan de Verdragsluitende Partij gebonden is.

b. worden als belastingen op het inkomen en het vermogen beschouwd alle belastingen die worden geheven op het gehele inkomen, op het gehele vermogen of op bestanddelen van het inkomen of vermogen, met inbegrip van belastingen op winsten uit de vervreemding van eigendom, onroerend-zaakbelasting, successierechten, belastingen op schenkingen of in wezen soortgelijke belastingen, belastingen op het totaalbedrag van de door ondernemingen betaalde lonen of salarissen, alsmede belastingen op de waardevermeerdering van vermogen.

c. wordt onder "bevoegde belastingautoriteit" verstaan de bevoegde autoriteit overeenkomstig een overeenkomst inzake dubbele belasting tussen de Verdragsluitende Partijen, of, bij ontstentenis van een van kracht zijnde overeenkomst de/het voor belastingen bevoegde minister of ministerie of hun gemachtigde vertegenwoordigers.

d. voor alle duidelijkheid wordt bepaald dat de termen "belastingbepalingen" en "belastingen" geen betrekking hebben op douanerechten.

Article 13 Expropriation

1. Investments of Investors of a Contracting Party in the Area of any other Contracting Party shall not be nationalized, expropriated or subjected to a measure or measures having effect equivalent to nationalization or expropriation (hereinafter referred to as "Expropriation") except where such Expropriation is:

a) for a purpose which is in the public interest;

b) not discriminatory;

c) carried out under due process of law; and

d) accompanied by the payment of prompt, adequate and effective compensation.

Such compensation shall amount to the fair market value of the Investment expropriated at the time immediately before the Expropriation or impending Expropriation became known in such a way as to affect the value of the Investment (hereinafter referred to as the "Valuation Date").

Such fair market value shall at the request of the Investor be expressed in a Freely Convertible Currency on the basis of the market rate of exchange existing for that currency on the Valuation Date. Compensation shall also include interest at a commercial rate established on a market basis from the date of Expropriation until the date of payment.

2. The Investor affected shall have a right to prompt review, under the law of the Contracting Party making the Expropriation, by a judicial or other competent and independent authority of that Contracting Party, of its case, of the valuation of its Investment, and of the payment of compensation, in accordance with the principles set out in paragraph (1).

3. For the avoidance of doubt, Expropriation shall include situations where a Contracting Party expropriates the assets of a company or enterprise in its Area in which an Investor of any other Contracting Party has an Investment, including through the ownership of shares.

In the Dutch translation:

Artikel 13 Onteigening

1. Investeringen van investeerders van een Verdragsluitende Partij op het grondgebied van een andere Verdragsluitende Partij mogen niet worden genationaliseerd, onteigend of onderworpen aan maatregelen met een soortgelijk effect als nationalisatie of onteigening (hierna te noemen "onteigening"), behalve wanneer de onteigening:

a. geschiedt in het algemeen belang;

b. niet discriminerend is;

c. geschiedt met inachtneming van een behoorlijke rechtsgang; en

d. gepaard gaat met de betaling van prompte, adequate en doeltreffende compensatie.

Die compensatie is gelijk aan de billijke marktwaarde van de onteigende investering op het tijdstip vlak voordat de onteigening of op handen zijnde onteigening zodanig bekend werd dat de investeringswaarde werd beïnvloed (hierna te noemen: de "datum van de waardebepaling").

Deze billijke marktwaarde wordt op verzoek van de investeerder berekend in een vrij inwisselbare valuta volgens de voor die valuta op de datum van de waardebepaling geldende marktwisselkoers. De compensatie omvat tevens rente over de periode tussen de onteigenings- en de betalingsdatum, welke berekend wordt tegen een commercieel, op marktbasis vastgesteld tarief.

2. De betrokken investeerder heeft recht op onverwijlde toetsing, krachtens het recht van de Verdragsluitende Partij die de onteigening verricht, van zijn zaak, de waardebepaling van zijn investeringen en de betaling van compensatie overeenkomstig de beginselen neergelegd in het eerste lid, door een gerechtelijke of andere onafhankelijke bevoegde instantie van die Partij.

3. Voor alle duidelijkheid wordt bepaald dat onteigening ook de gevallen omvat waarin een Verdragsluitende Partij de activa onteigent van een vennootschap of onderneming op haar grondgebied waarin een investeerder van een andere Verdragsluitende Partij een investering, ook indien via aandelenbezit, heeft.

With reference to what I noted with regard to ground 2.7, I do not consider referring a question to the ECJ for a preliminary ruling on the interpretation of Article 21 ECT necessary for the outcome of the proceedings in cassation with regard to ground 5 either. After all, in the challenged judgment, the Court of Appeal decided in line with the Russian Federation's argument that the Tribunal acted contrary to Article 21(5) ECT. However, the Court of Appeal did not find this violation of the mandate sufficiently serious that the Yukos Awards should be set aside. Whether or not the complaints in cassation regarding that decision are successful is not therefore dependent on the interpretation of Article 21(5) ECT but on the question of whether the Court of Appeal's findings in the context of Article 1065(1)(c) DCCP are comprehensible. There is therefore no need to refer questions for a preliminary ruling.

"the better view is that there is no per se prohibition on secretaries or junior lawyers performing such tasks, provided that the members of the tribunal carefully review and make appropriate use of any preparatory work."²⁰⁸

Peters concurs with this, and is of the opinion that it is not a problem if secretaries write (parts of) an arbitral award, provided this is done in accordance with the instructions of and under the responsibility of the arbitral tribunal, and that the latter does not adopt the texts indiscriminately.²⁰⁹ Smakman took a similar position.²¹⁰ Sanders is of the opinion that "the reasoning of the award or parts thereof (...) is solely the task of the arbitral tribunal, and it does so in its own words."²¹¹ Von Hombracht-Brinkman distinguishes between cases in which the arbitral tribunal consists (partly) of lawyers and cases in which that is not the case, and considers the drafting of an award by a secretary to be acceptable only in the latter case.²¹² Partasides thinks it undesirable (but not unacceptable, per se) that the draft decision be left to a secretary, but also writes that this is strongly dependent on the circumstances. Moreover, decisions in this regard are up to the arbitrator.²¹³ Polkinghorne and Rosenberg are outspoken: in their opinion, it is impermissible for the secretary to write substantive sections of the judgment.²¹⁴

Ground 6.2.2 complains that in para. 6.6.13, the Court of Appeal rejected the reliance on Article 1065(1)(b) DCCP in conjunction with Article 1026(1) DCCP. That reliance entails that, as a result of Valasek’s involvement, the Yukos Awards were, in fact, rendered not by three but by four arbitrators, which is a violation of the aforementioned provisions. The Court of Appeal held that the Yukos Awards were signed by the three appointed arbitrators, thus fulfilling the requirements under those provisions. The Court of Appeal therefore interpreted those provisions too narrowly, given that they are also meant to prevent a fourth person from, in fact, serving as arbitrator, according to the ground.

Briefly put, the context of the complaints in ground 7 is as follows (for a more detailed representation, see para. 8.4.2 et seq. of the final judgment). In the arbitration proceedings, HVY argued that the additional tax assessment imposed on Yukos had been fabricated and was basically an expropriation. The Russian Federation argued that HVY could have known that the way Yukos used tax exemption in low-tax regions (including Mordovia) was inconsistent with the applicable bad faith taxpayer doctrine. The Tribunal assessed whether evidence had been provided that there was bad faith. The Tribunal subsequently decided that "the massive record" contains no evidence of the statement that Yukos' Mordovian companies were shams (sub-chapter 639 Final Awards). In the setting-aside proceedings, the Russian Federation argued that this decision was insufficiently substantiated because such evidence had actually been submitted in the arbitration proceedings. The Court of Appeal rejected this argument because, according to the Court of Appeal, it is clear that with "the massive record", the Tribunal referred to the record at issue in the tax proceedings conducted by Yukos in Russia (para. 8.4.13). The Court of Appeal further substantiated this in paras. 8.4.1.4-8.4.16 by pointing out that the Tribunal's decision focusses on the question of whether there was due process in the Russian tax proceedings.

The ground fails to recognise that the Court of Appeal does not provide "alternative" reasoning in the challenged finding, but superfluously finds that even if the Russian Federation's interpretation of sub-chapter 639 of the Final Awards is correct, this does not affect the Tribunal's ultimate conclusion. That this is a superfluous finding is shown by the fact that in para. 8.4.13, the Court of Appeal explicitly based itself on a different interpretation of the Tribunal's decision. The complaints fail for this reason.