For the many references made in this Award to the file of the Case, for convenience and shortness the Tribunal will use the following abbreviations:
Art. = Article of 1993 Law
A I = Albania's Counter Memorial of 28.12.97
A II = Albania's Rejoinder of 2.3.98
A III = Albania's Post-Hearing Memorandum of 8.12.98
A I Exh. 1 seq. = Exhibits submitted by Albania with A I
A II Exh. 1 seq. = Exhibits submitted by Albania with A II
H I-III = Handouts by Parties at the Hearing
J = Decision on Jurisdiction 24.12.96
T I = Tradex' Request for Arbitration of 17.10.94
T II = Tradex' Memorandum of 8.7.98
T III = Tradex' 2nd Memorandum of 27.1.98
T IV = Tradex' 3rd Memorandum of 25.6.98
T V = Tradex' Post-Hearing Memorandum of 4.12.98
T 1 seq. = Exhibits submitted by Tradex
Tr = Transcript of Final Hearing
"I am instructed by the Minister to respond to your letter of 25 September 1996.
As indicated during the hearing held in London on 10 September 1996, the Ministry of Agriculture of the Republic of Albania considers that the dispute settlement rules applicable to the facts raised in Tradex' Request for ICSID arbitration, if any, are those set forth in Law No. 7594 of 4 August 1992.
Article 15 of the 1992 Law is therefore applicable. It provides for UNCITRAL arbitration and sets forth certain conditions and exclusions for such arbitration to be effective. Whether those conditions or exclusions have been satisfied or are applicable in respect of the matter brought by Tradex to ICSID raises questions of fact and law which would need to be considered further by the Ministry of Agriculture and eventually by any arbitral Tribunal that might be constituted pursuant to the 1992 Law. In the first place it will be a matter for Tradex whether to decide to make an application for arbitration under UNCITRAL rules in reliance of the 1992 Law."
"1. The Tribunal has jurisdiction subject to the following: The issue as to whether or not an "expropriation" has been shown as required by the 1993 Law is joined to the merits of this case.
2. After consultation with both Parties a procedural order will be issued regarding the further procedure."
1. Professor Karl-Heinz Bockstiegel, President
2. Fred F. Fielding, Esquire
3. Professor Andrea Giardina
Secretary of the Tribunal
4. Mrs. Margrete L. Stevens
Tradex Hellas S.A.
5. Professor L. Georgakopoulos
6. Mr. E. Spinelis
7. Mr. C. Azas
8. Mr. S. Hadjigeorgiou
9. Mr. D. Stergioulas
10. Mr. S. Lapardhaja
Republic of Albania
11. Ms Rezarta Gaba
12. Mr. Fatos Gjini
13. Mr. Ardian Takaci
14. Mr. Arden Pata
15. Mr. James Crawford
16. Mr. Philippe Sands
17. Ms Ruth Mackenzie
18. Mr. Edward Helgesen
19. Mr. Anthony Nannini
20. Mr. Stephen Hodgson
21. Mr. Elez Lohja
22. Mr. Mark Ndoci
23. Mr. Nikolin Ujka
24. Mr. Frank Alexander
25. Professor Saul Estrin
Dr. Z. Tofallis, Greek Interpreter
Mr. Gezim Guri, Albanian Interpreter
1. Introduction by the President of the Tribunal
2. First Round Presentation by Tradex
3. First Round Presentation by Albania
4. Questions by Arbitrators
5. Rebuttal Presentation by Tradex
6. Rebuttal Presentation by Albania
7. Further Questions by Arbitrators
Witnesses presented by Tradex:
Mr. C. Azas
Mr. S. Lapardhaja
Mr. D. Stergioulas
Mr. S. Hadjigeorgiou
Witnesses presented by Albania :
Mr. M. Ndoci
Mr. N. Ujka
Mr. E. Lohja
Mr. F. Alexander
Prof. S. Estrin
– the transcript, when available, would be transmitted by the ICSID Secretariat simultaneously to the Parties and the members of the Tribunal,
– the Parties had 4 weeks after receiving the transcript to file Post-Hearing Memoranda with their final comments on the results of the Hearing and any errata in the transcript, but that no new documents could be submitted at that stage.
Based on its Request of Arbitration of 17 October 1994 and as updated by its final submission, its Post-Hearing Memorandum of 4 December 1998, Tradex requests that Albania be obliged and condemned to pay:
"a. Fair Market value as of 01.01.1993 per our Request for Arbitration: 2,200,000
Machinery & equipment returned on Liquidation of the J.V. (attachment 20 of Request): (352,187)
Net Fair Market Value of TRADEX share to T.& T.J.V. 1,847,813
b. Interest as per para 23 hereabove: 824,013
c. Arbitration fees: 107,000
d. Legal, Valuation and other consulting fees and services: 246,255
e. Travel, typing, printing, translations and other expenses: 81,993
"– that Tradex has shown no prima facie act of expropriation attributable to the Albania, and that accordingly Albania has not under Article 25(1) of the ICSID Convention and Law No. 7764 of 2 November 1993 expressed its consent for the matters raised by Tradex in its Request for arbitration dated 17th October 1994 to be subject to ICSID jurisdiction, and that the Tribunal does not have jurisdiction to entertain the claim;
– further or alternatively, that no act of expropriation has occurred or is attributable to Albania within the meaning of Article 4 of Law No. 7764 of 2 November 1993;
– that the Request by Tradex be dismissed; and
– that Tradex and its shareholders be required to pay Albania's costs in this matter and the costs of the Arbitral Tribunal."
a) On 22 August 1992, a most significant part of the farm was formally expropriated and transferred to villagers by Albania, namely 140 ha amounting to 15 % of the total farm and its most fertile area.
b) Crop production, cattle, and seed supplies were stolen by the villagers at an almost steady rate of 15 % between March and October 1992 and work of the management of the joint venture was often impossible because of threats and acts of violence.
c) Beginning December 1992, the entry of Tradex' personnel to the farm was made completely impossible because of the seizure and occupation of the farm by villagers.
d) By letters in late 1992 and early 1993, Tradex requested in vain the intervention by Albania as a last effort to save the investment, but Tradex was obliged to hand over the 140 ha mentioned together with cultivations, cattle, and supplies.
a) the market value of Tradex's expropriated investment amounting to US $ 2,023,907;
b) interest on that amount mentioned at current banking interest rate, from December 1, 1992, until payment, and
c) fees and legal expenses of Tradex, to be calculated later.
"if the dispute arises out of or relates to expropriation, compensation for expropriation, or discrimination and also for the transfers in accordance of Article 7,...".
As no discrimination and no breach of the obligations under Art. 7 regarding transfers are claimed by Tradex (see latest Memorandum of 4 December 1998), in view of the above mentioned limitation, for the Tribunal's examination on the merits only the following Articles of the 1993 Law must be considered as possible sources of the claim insofar as they may become relevant for an expropriation and a compensation for expropriation:
Entry and Treatment
1. Foreign investment in the Republic of Albania are nto (sic) conditioned from a preliminary authorization. They are permitted and treated on a basis no less favourable than that accorded in like situations to Albanian investments, except that ownership of land which will be treated by a special law.
2. In all cases and at all times, foreign investment shall receive fair and equitable treatment, shall enjoy full protection and security.
3. In any case foreign investments shall be treated on a basis no less favorable than that accorded by rules generally accepted by international law.
Expropriation and Nationalization
Foreign investments shall not be expropriated or nationalized either directly or indirectly or subject to any measure of tantamount effect, except for a public purpose determined on law, in a non-discriminatory manner, upon payment of prompt, adequate and effective compensation and in accordance with due process of law.
Compensation for Expropriation and Nationalization
1. Compensation shall be equivalent to the fair market value of the expropriated investment immediately before the expropriatory action was taken or become known, whichever is earlier.
2. Compensation shall be paid without delay and include interest at a commercially reasonable rate from the date of the expropriation, be fully transferable and convertible at the market rate of exchange on the date of the expropriation.
3. In cases in which a foreign investor asserts that all or part of its foreign investment has been expropriated or considers the compensation therefor to be unsatisfactory, the foreign investor shall have a right to prompt review by the appropriate judicial or administrative bodies in accordance with the provisions of Article 8 of this Act.
"admit evidence given by a witness or expert in a written deposition."
"The joint venture will be also conformed to the necessary addendum will taken place to the albanian legislation concerning the land." (sic the official translation provided to the Tribunal.)
"2. The rural area of 140 ha of Mali Kolaj village remains to the prefecture of Shkoder." (sic in the English translation provided to the Tribunal.)
Torovitsa lost its ownership in any land or the Joint Venture lost the right and the factual possibility to use its land. In fact, the witness statement by Mr. Tusha (A II Exh. 12), to which Tradex particularly referred in this context (Tr 203), on one hand calls this decision "the basis" for "subsequent decisions" to "begin" the distribution of land, but on the other hand expressly mentions that this decision "does not affect the title on property" (emphasis added by Tribunal).
The only alleged occupation confirmed by a contemporaneous document is the one of 4 December 1992. The Minutes of Meeting of that day (T 75) have the following wording:
"We report that today the 4th December 1992 we caught the animals of the village Mali-Kolaj in the sown field with clover, cotton and maize. The parcels No. 1, 2, 3 shown with clover and parcel 13 with cotton and maize.
1. The parcel No. 3 distroyed completely.
2. The parcel No. 13, 4 ha cotton and 9 ha maize destroyed completely.
with the explanation that "today the land is ours because it was given to us by the Prefecture and the Commune of Ball-dren".
We prepared these minutes to demand idemnity.
(1) The complete inexistence of security of the production of the J.V. and of the life of the managerial personnel of the J.V.
(2) The destruction of the irrigation system of the farm by the inhabitants of the region.
(3) The take-over of lands of the farm by inhabitants of the region with permission of the State."
"I think no. We did not say we have the problem because, as I told you, we did not believe serious problems at this time."
(Tr 45, 46)
a) The claim by Tradex is denied.
b) Each Party shall bear its own expenses and the costs of its own legal representation in this Case.
c) The costs of the arbitration, covered by equal advance deposits by both Parties, shall be born by the Parties equally in shares of 50 %.
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