"[An] order [to] the Czech Republic to take such actions as are necessary to restore the contractual and legal rights associated with the claimant’s investments. Among other things, the Czech Republic should:
a) be ordered to impose conditions on the License that adequately reflect and secure CNTS's exclusive right to provide broadcast services and its right to obtain all corresponding income in connection with the operation of TV Nova;
b) be required to enforce such conditions, including by revoking the License and reissuing it to CNTS or to such other entity and under such other circumstances as would restore the initial economic underpinnings of Mr. Lauder’s investment; and
c) be held liable for the damages Mr. Lauder has incurred to date, in an amount to be determined by the Tribunal, taking into account, among other factors, the fair market value of Mr. Lauder’s investment prior to the breaches of the Treaty".
• 29 June 2000 Declaration of Michel Delloye
• 29 June 2000 Declaration of Fred T. Klinkhammer
• 30 June 2000 Supplemental Declaration of Richard Bacek
• 30 June 2000 Declaration of Laura DeBruce
• 30 June 2000 Declaration of Martin Radvan
• 30 June 2000 Declaration of Jan Vávra
• 13 October 2000 Statement of Doe. Ing. Pavel Mertlik CSc
• 16 October 2000 Statement of Josef Josefik
• 16 October 2000 Statement of RNDR. Josef Musil
• 16 October 2000 Statement of PhDr. Helena Havíková
• 14 November 2000 Declaration of Jacob Z. Schuster
• 5 December 2000 Supplemental Declaration of Jan Vávra
• 5 December 2000 Statement of Ing. Jiri Broz
• 5 December 2000 Declaration of OhDr Marina Landová
• 7 December 2000 Declaration of Leonard M. Fertig
• 7 December 2000 Declaration of Nicholas G. Trollope
• 8 December 2000 Supplemental Declaration of Laura DeBruce
• 8 December 2000 Supplemental Declaration of Fred T. Klinkhammer
• 8 December Supplemental Declaration of Martin Radvan
• 21 December 2000 Declaration of Ing. Miroslav Pycha
• Mrs. Marina Landová
• Mr. Jan Vávra
• Mr. Martin Radvan
• Mrs. Laura DeBruce
• Mr. Leonard M. Fertig
• Mr. Fred T. Klinkhammer
• Mr. Michael Delloye
The Respondent presented the following witnesses:
• Mr. Josef Josefik
• Mr. Milan Jakobec
• Mrs. Helena Havlíková
• Mr. Josef Musil
Two witnesses, Mr. Jiri Broz and Mr. Josef Musil, did not attend the hearings. It was agreed by the Parties on 13 March 2001 that the Arbitral Tribunal would give these witnesses’ recorded statements the weight the Tribunal believes to be appropriate (Transcript of 13 March 2001, p. 225-226).
On 13 March 2001, the Chairman declared that the proceedings were closed subject to the Parties’ filing of their Written Closing Submissions by 30 March 2001 and their Replies by 6 April 2001, as well as the Parties’ filing of their Statement of Costs and Expenses as agreed between the Parties (Transcript of 13 March 2001, p, 230-232).
(1) Declaring that Respondent has violated the following provisions of the Treaty:
a. The obligation of fair and equitable treatment of investments (Article II(2)(a));
b. The obligation to provide full protection and security to investments (Article n(2)(a);
c. The obligation to treat investments at least in conformity with principles of international law (Article II(2)(a));
d. The obligation not to impair investments by arbitrary and discriminatory measures (Article II(2) (b)); and
e. The obligation not to expropriate investments directly or indirectly through measures tantamount to expropriation (Article III);
(2) Declaring that Claimant is entitled to damages for the injury that he has suffered as a result of Respondent’s violations of the Treaty, in an amount to be determined at a second phase of this arbitration; and
(3) Directing Respondent to pay the costs Claimant has incurred in these proceedings to date, including the costs for legal representation and assistance (Relief Sought By Claimant of 10 March 2001).
(1) Mr. Lauder’s claim be dismissed on grounds of lack of jurisdiction, namely (i) no "investment dispute" as contemplated by the Treaty exists; and/or (ii) Mr. Lauder’s Notice was premature or otherwise formally defective.
(2) And/or Mr. Lauder’s claim be dismissed on grounds of lack of admissibility, namely it is an abuse of process
(3) And/or Mr. Lauder’s claim be dismissed on grounds that the Czech Republic did not violate the following provisions of the Treaty as alleged (or at all):-
(a) The obligation of fair and equitable treatment of investments (Article 11(2) (a)).
(b) The obligation to provide full protection and security to investments (Article II(2)(a)).
(c) The obligation to treat investments at least in conformity with principles of international law (Article 11(2) (a)).
(d) The obligation not to impair investments by arbitrary and discriminatory measures (Article 11(2) (b)).
(e) The obligation not to impair investments directly or indirectly through measures tantamount to expropriation (Article III).
(4) And/or Mr. Lauder’s claim be dismissed and/or Mr. Lauder is not entitled to damages, on ground that the alleged injury to Mr. Lauder’s investment was not the direct and foreseeable result of any violation of the Treaty.
(5) And Mr. Lauder pay the costs of the proceedings and reimburse the reasonable legal and other cost of the Czech Republic (Relief Sought by the Czech Republic of 13 March 2001).
• Mr. Zelezny: 60%
• The four remaining Founders: 37.5%
• CME: 1.25%
• CSB: 1.25%.
• CME: 93.2%
• Nova Consulting: 5.8%
• The Founders: 1%.
• CME initiated parallel UNCITRAL arbitration proceedings against the Czech Republic on the basis of the bilateral investment treaty between the Netherlands and the Czech Republic;
• CME brought ICC arbitration proceedings against Mr. Zelezny (Exhibit R46);
• Numerous civil actions were commenced before the Czech courts, most of them opposing CNTS and CET 21 (Exhibit R49).
a) The Claimant has failed to prove that he owns or controls an investment within the Czech Republic;
b) The Claimants claim is not an investment dispute under the Treaty;
c) The Claimant already submitted the same dispute to the courts of the Czech Republic and to other arbitral tribunals (Article VI(3)(a) of the Treaty);
d) The Claimant may not concurrently pursue the same remedies in different fora;
e) The Claimant’s claim constitutes an abuse of process;
f) The Claimant did not comply with the six-month waiting period (Article VI(2)(a) of the Treaty) (see Statement of Defence, p. 12-13; Response, p. 40-49; Sur-Reply, p. 14-17).
• The Treaty is prima facie applicable to events occurring after 19 December 1992;
• Mr. Lauder is a national of the United States;
• CEDC’s (and later CME’s) shareholding in CNTS is an investment;
• The Claimant’s allegations constitute an investment dispute for the purpose of the Treaty;
• For jurisdictional purpose only, the Claimant controlled the investment (see Written Closing Submissions, p. 4-5).
"(...) Once the national or company concerned has so consented, either party to the dispute may institute such proceeding provided:
(i) the dispute has not been submitted by the national or the company for resolution in accordance with any applicable previously agreed dispute-settlement procedures; and
(ii) the national of company concerned has not brought the dispute before the courts of justice or administrative tribunals or agencies of competent jurisdiction of the Party that is a party to the dispute. (...)"
a) the prohibition against arbitrary and discriminatory measures;
b) the obligation to provide fair and equitable treatment;
c) the obligation to provide full protection and security;
d) the obligation of treatment in accordance with general principles of international law;
e) the obligation not to expropriate unlawfully (Reply Memorial, p. 62; Summary of Summation, p. 13-14).
a) the obligation not to expropriate unlawfully with respect to all time periods;
b) the obligation of treatment in accordance with the general principles of international law with respect to all time periods;
c) all remaining alleged violations of the Treaty within the 1992-1993 time period;
d) all remaining alleged violations of the Treaty within the 1994-1997 and 1998-1999 time periods.
"Investments shall not be expropriated or nationalized either directly or indirectly through measures tantamount to expropriation or nationalization ("expropriation") except for a public purpose; in accordance with due process of law; in a nondiscriminatory manner; upon payment of prompt, adequate and effective compensation; and in accordance with the general principles or treatment provided for in Article 11(2)
"Neither Party shall in any way impair by arbitrary and discriminatory measures the management, operation, maintenance, use, enjoyment, acquisition, expansion, or disposal of investment. For the purpose of dispute resolution under Articles VI and VII, a measure may be arbitrary and discriminatory notwithstanding the fact that a party has had or has exercised the opportunity to review such measure in the courts or administrative tribunals of a Party".
"Each Party shall permit and treat investment, and activities associated therewith, on a nondiscriminatory basis, subject to the right of each Party to make or maintain exceptions falling within one of the sectors or matters listed in the Annex to this Treaty. (...)".
"Consistent with Article II, paragraph 1, the Czech and Slovak Federal Republic reserves the right to make or maintain limited exceptions to national treatment in the sectors or matters it has indicated below:
ownership of real property; and insurance".
a) the prohibition against arbitrary and discriminatory measures;
b) the obligation to provide fair and equitable treatment:
c) the obligation to provide full protection and security (Reply Memorial, p. 62-89; Summary of Summation, p. 13-14).
1. It has jurisdiction to hear and decide this case.
2. The Respondent committed a breach of its obligation to refrain from arbitrary and discriminatory measures when in the Winter of 1993 it changed its original position, which had been made known to the Claimant and to the public at large, allowing an equity investment of the Claimant in CET 21, the holder of the licence to broadcast, and insisted that the participation of the Claimant could not be made in the form of an equity participation but only through a joint venture company.
3. The claim for a declaration that the Respondent committed further breaches of the Treaty are denied and all claims for damages are denied.
4. Each Party shall pay one half of the fees and expenses of the Arbitral Tribunal which are fixed at US$ 50L370.20
5. Each Party shall pay one half of the direct costs involved in the London Hearings, including room hire, cost of court reporters, etc.
6. Each Party shall carry its own costs for legal representation and assistance, including the travel and other expenses of witnesses presented by the respective Party.
7. All other claims are herewith dismissed.