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A RBITRAL TRIBUNAL OF

THE

INTERNATIONAL CENTRE FOR SETTLEMENT OF

INVESTMENT DISPUTES 2008

SUPER TECH ENTERPRISES L TD.

[CLAIMANT]

V

THE REPUBLIC OF FRUGALIA

[RESPONDENT]

MEMORANDUM for

CLAIMANT



ii

-Table of Contents-

TABLE OF CONTENTS

TABLE OF CONTENTS........................................................................................................2

TABLE OF ABBREVIATIONS................................................................................................... i

I NDEX OF AUTHORITIES.....................................................................................................2

STATEMENT OF JURISDICTION..............................................................................................6

QUESTIONS PRESENTED.....................................................................................................7

STATEMENT OF FACTS....................................................................................................... 8

PLEADINGS AND AUTHORITIES...........................................................................................14

I. There exists a valid arbitration clause showing ICSID to be the re!erred !or" o!

arbitration............................................................................................................. 14

1.1. THE ARBITRATION CLAUSE IN THE AGREEMENT IS VALID...............................................14

1.2. THE PARTIES BY VIRTUE OF THE AGREEMENT INTENDED THAT ICSID WOULD BE THE FORUM FOR

ARBITRATION.......................................................................................................... 1#

1.3 THE REFERENCE TO “R ULES USED IN WASHINGTON D.C. REVEALS THE CONCERNED PARTIES

INTENTION TO ARBITRATE UNDER RULES WITH A SPECIFIC LIN! TO WASHINGTON D.C." I.E. ICSID.

........................................................................................................................... 16

1.#. THE REFERENCE TO $I NTERNATIONAL ARBITRATION R ULES% DOES NOT INVALIDATE THE PARTIES%

INTENTION TO ARBITRATE UNDER THE ICSID...................................................................17

2. Suer$Tech% !or the urose o! the ICSID convention is a &otundian 'ational.. .17

2.1. FRUGALIA IS ESTOPPED FROM TA!ING ACTION AGAINST SUPER TECH...............................18

2.2. SUPER TECH" FOR THE PURPOSE OF THE ICSID" IS A NATIONAL OF R OTUNDIA.....................1(

3. SUPER -TECH IS ENTITLED TO APPROACH THE ICSID ARBITRAL PANEL DIRECTLY UNDER ARTICLE 3

OF THE BIT............................................................................................................... 2)

3.1. OBLIGATION OF MOST FAVOURED NATION TREATMENT EXTENDS TO DISPUTE R ESOLUTION

PROCEDURES.......................................................................................................... 2)

MEMORANDUM for CLAIMANT



iii

-Table of Contents-

3.2. PROVISIONS OF ARTICLE &'2( A ND &'3( DO NOT LIMIT THE SCOPE OF ART 3 OF THE BIT.....22

3.3. THE PROCEDURE LAID DOWN BY ARTICLE &'2( AND '3( IS LESS FAVOURABLE THAN THAT

ACCORDED TO I NVESTORS OF OTHER COUNTRIES.............................................................2*

4. The &esondent+s Tax$,easures% to the -xtent the Concern &otundian

Investors% are /iolative o! 0air and -uitable Treat"ent+ 3bligation and is violative

o! rticle 2 o! the 5IT.............................................................................................24

#.1. THE OBLIGATION U NDER ARTICLE 2 OF THE BIT IS NOT LIMITED TO I NTERNATIONAL MINIMUM

STANDARDS............................................................................................................24

#.2. A RGUENDO" THE I NTERNATIONAL MINIMUM STANDARDS OF $FAIR AND EQUITABLE TREATMENT%

I NCLUDES PROTECTION OF LEGITIMATE EXPECTATIONS......................................................26

#.3 THE R ESPONDENT ,THROUGH ITS CHANGE IN TAX POLICY HAS BREACHED THE OBLIGATION OF

FAIR AND EQUITABLE TREATMENT...............................................................................26

#. The Tax ,easures o! the Respondent "ount to nusti9ed -xroriation

nder International :aw and is /iolative o! rticle 4 o! the 5IT.............................27

).1. TAX MEASURES OF THE R ESPONDENT AMOUNT TO I NDIRECT EXPROPRIATION U NDER

I NTERNATIONAL LAW................................................................................................ 27

).2. THE IMPUGNED EXPROPRIATION BY THE R ESPONDENT IS ILLEGAL IN I NTERNATIONAL LAW....2(

).3. THE IMPUGNED MEASURE IS NOT JUSTIFIED AS AN EXERCISE OF THE POLICE POWERS OF THE

STATE................................................................................................................... *)

).#. A RGUENDO" THE STATE IS PRECLUDED FROM THE EXERCISE OF ITS POLICE POWERS TO THE

EXTENT IT HAS U NDERTA!EN OBLIGATIONS TO THE CONTRARY...........................................*)

REQUEST FOR RELIEF...........................................................................................*2




iv

-Table of Abbreviations-

TABLE OF ABBREVIATIONS

Am. Rev. Int’l Arb. A*+,/0 R++ 4 I05+,0/50/6 A,75,/50

Arizona J. Int’l & Comp. L. A,80/ J9,0/6 4 I05+,0/50/6 /0: C*;/,/5+ L/

Art. A,56+

BIT B6/5+,/6 I0+<5*+05 T,+/5=

Cir. C,95

CLOT C/<+ L/ 0 UNCITRAL T+>5<

!i"p. Re"ol. J. D<;95+ R+<6950 J9,0/6

!i"t. D<5,5

E#. E:50

ICAB I05+,0/50/6 C9,5 4 A,75,/50 B966+50

ICC I05+,0/50/6 C?/*7+, 4 C**+,+

ICCA I05+,0/50/6 C906 4, C**+,/6 A,75,/50

ICJ I05+,0/50/6 C9,5 4 J9<5+

ICSI! I05+,0/50/6 C+05,+ 4, S+556+*+05 4 I0+<5*+05

D<;95+<

I.L.C. I05+,0/50/6 L/ C**<<0

Int’l Arb. L. Rev I05+,0/50/6 A,75,/50 L/ R++

Int’l Arb. Rep. I05+,0/50/6 A,75,/50 L/ R+;,5<

Lt#. L*5+:

NAFTA N,5? A*+,/0 F,++ T,/:+ A@,++*+05

no. N9*7+,

Rep. R+;,5 R+;,5<

NCITRAL U05+: N/50< C**<<0 0 I05+,0/50/6 T,/:+ L/v. V+,<9<

VCLT V+00/ C0+050 0 5?+ L/ 4 T,+/5+<

Vol. V69*+

$TO W,6: T,/:+ O,@/0</50

%CA Y+/,7 4 C**+,/6 A,75,/50



v

- Index of Autorities-

IN!E OF AT'ORITIES

International Treatie" an# Convention"

E0+,@= C?/,5+, T,+/5=" '<@0+: 1 D++*7+, 1#" +05+,+: 05 4,+ 3 D++*7+, 1(" 2&UNTS 1 ?+,+0/45+, E.C.T...................................................................................................1

General A!ree"ent on Tariff and Trade, 1#..............................................................................12

ICSID C0+050<" R+@96/50< /0: R96+<" //6/76+ 060+ /5

?55;<:.,6:7/0.,@ICSIDS5/5F6+<7/<:+0-/,?+ICSIDE0@6<?.;:4.............)

N,5? A*+,/0 F,++ T,/:+ A@,++*+05 '/:;5+: D++*7+, 1" 12" +05+,+: 05 4,+ 1

J/09/,= 1#( CTS 1# N. 2..................................................................................................1

T?+ A<</50 4 S95? A</0 N/50< A@,++*+05 4, T?+ P,*50 /0: P,5+50 4

I0+<5*+05< '<@0+: 1) D++*7+, 1&( '1&&( 2 ILM 12" 13...........................................1

VIENNA CONVENTION ON THE LAW OF TREATIES" M/= 23"1..................................................1

.N. !o()ment"

I05%6 L. C**%0" Re#ort of te International $a% Co""ission, )5? S+<<." U.N. D. A)1 /5

13..................................................................................................................................................

Treati"e"

B,0" G/,= B." INTERNATIONAL COMMERCIAL ARBITRATION COMMENTARY AND MATERIALS" 2 ND

ED." ARDSLEY" NEW YOR! " 21.................................................................................................#

C,/@" L/,+0+" P/," W66/*" P/96<<0" J/0K INTERNATIONAL CHAMBER OF COMMERCE

ARBITRATION" 3RD

ED." OCEANA PUBLICATIONS" PARISLONDON 2.........................................#F9?/,:" P?6;;+" G/66/,:" E**/09+6" G6:*/0" B+,5?6:" INTERNATIONAL COMMERCIAL

ARBITRATION" !LUWER LAW INTERNATIONAL" THE HAGUE" 1" #&.....................................

I. S06/," Te Prin&i#les of Treat' Inter#retation and teir A##li&ation b' te En!lis Courts,

3 I.C.L.Q. 12 '13(.................................................................................................................1

M.N. S?/" I NTERNATIONAL LAW &3" '23(.............................................................................1

M N/," THE LAW OF TREATIES" 3) '11(................................................................................1

OPPENHEIM%S I NTERNATIONAL LAW" 122 'J+000@< W/55<"+:( '1(....................................1

P. C,/@" ADMINISTRATIVE LAW" '23(" )5? E:." S++5 M/>+66" L0:0(.....................1)

R+:4+,0" A6/0" M/,50" H905+," LAW AND PRACTICE OF INTERNATIONAL COMMERCIAL

ARBITRATION" #TH ED." SWEET MAXWELL" LONDON" 2#" P/,/. 1-......................................#T.O. E6/<" THE MODERN LAW OF TREATIES.................................................................................11

$or*" o+ ,)bli(i"t"

G. F58*/9,+" (ae (i&ti& or )oe to te Ne!otiators* +our Treat' or our inter#retation of it 3

A.J.I..L. ) '11(......................................................................................................................1




vi

- Index of Autorities-

L++" L/,+0+ J." ARCE$ONA TRACTION IN THE 21ST CENTURY REVISITING ITS CUSTOMARY AND

POLICY UNDERPINNINGS 3) YEARS LATER #2" STAN. J. INT%L LAW 2#) '2(...........................

LY F,5+, SL D,=*+," “ Indire&t Ex#ro#riation in te $a% of International Invest"ent. I

/no% it %en I see it, or Caveat Investor " '2#( 1 ICSID R+-FILJ 23";;.2-3).......1&

O.E.C.D , Indire&t Ex#ro#riation and te Ri!t to Re!ulate in International Invest"ent $a%,W,0@ P/;+,< 0 I05+,0/50/6 I0+<5*+05" N. 2##" S+;5+*7+, 2#.............................1

O.E.C.D" Te 0ultilateral A!ree"ent on Invest"ent Ne!otiatin! Text //6/76+ /5

?55;.+:.,@:/5/+:##1&)12.;:4 '<5+: 0 &.2.2&(...................................1

O,@/08/50 4, E0* D++6;*+05 /0: C-;+,/50 ereinafter O1E1C1D12, Indire&t

Ex#ro#riation and te Ri!t to Re!ulate in International Invest"ent $a%, W,0@ P/;+,< 0

I05+,0/50/6 I0+<5*+05" N. 2##" S+;5+*7+, 2#" ;;. 3-#...............................................1

S. V+<+6" Clearin! a Pat trou! a Tan!led 3uris#ruden&e. 0ost-4avoured-Nation Clauses and

Dis#ute Settle"ent Provisions in ilateral Invest"ent Treaties" 32 YALE J. I NT%L L. 12) '2(

....................................................................................................................................................1




vii

-State"ent of 5urisdi&tion-

STATE-ENT OF JRIS!ICTION

T?+ C6/*/05 ?/< 5?+ H09, 4 S97*550@ 5?< M+*,/0:9* 7+4,+ 5?+ T,790/6 90:+, A,5. &

'1( 4 5?+ A@,++*+05 B+5++0 5?+ R+;976 4 F,9@/6/ /0: 5?+ D+*,/5 R+;976 4

R590:/ 4, 5?+ P,*50 /0: P,5+50 4 5?+ I0+<5*+05< /0: 5?+ E09,/@+*+05 /0:

R+;,/6 P,5+50 4 I0+<5*+05< 'E05+,+: I05 4,+ 0 1<5 M/,? 2#.




viii

-6uestions Presented-

ESTIONS ,RESENTE!

1. W?+5?+, 5?+,+ +><5< / /6: /,75,/50 /@,++*+05 7+5++0 5?+ ;/,5+< :+<@0/50@ 5?+ ICSID

A,75,/6 5,790/6 /< 5?+ ;,+4+,,+: 4,9* /0: 5?+ ,,+<;0:0@ ,96+< 4 05+,0/50/6 /,75,/50 /<

5?+ /;;6/76+ ,96+<.

2. W?+5?+, 5?+ C $AI0ANT /0 7+ 0<:+,+: / 0/50/6 4 R590:/ 4, 5?+ ;9,;<+ 4 5?<

;,++:0@.

3. W?+5?+, 5?+ C $AI0ANT /0 ,+6= 0 A,5. 3 4 5?+ BIT 5 +<5/76<? 5?+ 9,<:50 4 5?+

T,790/6 055?<5/0:0@ 5?+ ;,<0< 4 A,5. &'2( /0: &'3( 4 5?+ </: A@,++*+05.

#. W?+5?+, 5?+ *;9@0+: 5/> *+/<9,+ 6/5+< A,5. 2 /0: A,5. # 4 5?+ A@,++*+05.




ix

-State"ent of 4a&ts-

STATE-ENT OF FACTS

I

T?+ R+;976 4 F,9@/6/" “F,9@/6/ /0 90:+,-:++6;+: 905,= 0 S95?-E/<5 A</" ?/< 7++0

90:+, **90<5 ,96+ 4, 5?+ ;/<5 <> :+/:+<. P,*/,6= /0 /@,/,/0 +0*=" 5 ?/: 7++0 4/0@

/ ,<< 4,* 5?+ 6/5+ 1<" 96*0/50@ 0 / 0+/,-*;6+5+ 7,+/:0 0 23" ??

0:+05/66= /6< 0:+: 5? / 4/*0+" ?? 6/<5+: 4, 4+ =+/,<.

II

S97<+9+056=" 5?+ **90<5 @+,0*+05 /< 5+: 95 4 ;+, /0: 5?+ 0+ @+,0*+05

?<+ 5 5,/0<4,* 5?+ +0*= 5 / /;5/6<5 <=<5+* 0 / ;?/<+: */00+, 5 </+ F,9@/6/ 4,*

49,5?+, ,<+00@ 4 5?+ +0* S59/50. A< ;/,5 4 5?< ;6=" 5?+ @+,0*+05 /@,++: 5;+0 9; 5?+ +0*= 5 4,+@0 0+<5*+05" /0: /,:0@6= +05+,+: 05 <++,/6 B6/5+,/6

I0+<5*+05 T,+/5+< ?+,+0/45+, BIT 5? :44+,+05 905,+<. T?< /< 5 +0/76+ ,/;: 046 4

490:< 05 5?+ 905,= 5?+,+7= 4/65/50@ +0* :++6;*+05.

III

T?+ D+*,/5 R+;976 4 R590:/" ?+,+0/45+," R590:/ < / 905,= 0 W+<5+,0 E9,;+"

5? / 7*0@ /;5/6<5 +0*=. I0 F+7,9/,= 2#" F,9@/6/ +05+,+: 05 / BIT 5? R590:/

5? / + 5 /;5/68+ 5?+ +0* <9+<< 4 5?+ 6/55+,.

IV

F,9@/6/ ?/< /6< +05+,+: 05 BIT< 5? 2# 5?+, 905,+< /;/,5 4,* 5?+ 0+ 5? R590:/. I0

A;,6 2#" 5 +05+,+: 05 / BIT 5? 5?+ R+;976 4 O+/0/" ?+,+0/45+, O+/0/ / 905,= 0

5?+ M::6+ E/<5 0 ?* F,9@/6/ < ?+/6= :+;+0:+05 4, 5< 6 ,+<9,+<. O4 5?+ 2) BIT<

F,9@/6/ ?/< +05+,+: 05 < 4/," 2# 05/0 :<;95+ ,+<6950 6/9<+< :+05/6 5 A,5. & 4 5?+

5,+/5= 5? R590:/. H++," 5?+ BIT 5? O+/0/ :+< 05 05/0 ;,<0< +9/6+05 5

A,5. &'2( /0: A,5. &'3( 4 5?+ F,9@/6/-R590:/ BIT. A66 4 5?+<+ 905,+<" .+. F,9@/6/"

R590:/" H=;,5+/ /0: O+/0/ /,+ ;/,5+< 5 5?+ I05+,0/50/6 C0+050 0 5?+ S+556+*+05

4 I0+<5*+05 D<;95+< ?+,+0/45+, ICSID.




x


V

S9;+,-T+? E05+,;,<+< L5:. ?+,+0/45+, S9;+,-T+?" 0,;,/5+: 0 5?+ S5/5+ 4 E0+*/"

?+,+0/45+, E0+*/ < / 6+/:+, 0 5?+ 4+6: 4 04,/<5,959,+" +>+950@ <*+ 4 5?+ 7@@+<5

04,/<5,959,/6 ;,+5< /,90: 5?+ ,6:. M/@0/T+? I0:9<5,+<?+,+0/45+, M/@0/T+?"

0,;,/5+: 0 R590:/" 0< 4 5?+ <?/,+?6:0@ 0 S9;+,-T+? /0: ?/< 5?+ ,@?5 5

/;;05 3 95 4 ) *+*7+,< 0 5?+ B/,: 4 D,+5,< 4 S9;+, T+?. O0+ M,. S?+,;/0" /

0/50/6 4 G,+@+,/" ?/< / )) <?/,+?6:0@ 0 M/@0/T+?. F,9@/6/ ?/< 05 +05+,+: 05 / BIT

5? G,+@/,/. G,+@/,/ /0: E0+*/ /,+ 05 ;/,5+< 5 5?+ ICSID.

VI

I0 21" F,9@/6/ +0/5+: 5?+ T/>/50 4 I0+<5*+05< A5" 21. T?+ ?/,@0@ <+50 4 5?+ A5"S. 2" ,+/: /< 466<" “7a2ll investors investin! in 4ru!alia, %eter dire&tl' or indire&tl', in te

se&tors s#e&ified in S&edule I, sall be &ar!ed tax at te rates s#e&ified in te rules to be "ade

in tis bealf b' te Govern"ent18 S?+:96+ I 069:+: 05+, /6/ 04,/<5,959,+" 0<5,950"

?9<0@ /0: 5?+, <9? /55+< /< / 6<5+: <+50. S. 4 5?+ A5 ;,:+: 4, 5?+ 0<55950

4 5?+ C+05,/6 B/,: 4 T/>/50. F9,5?+," S. 1 <;+4+: 5?/5" 97t2e oard &onstituted under S1

: as te #o%er to issue &larifi&ator' &ir&ulars to resolve doubts re!ardin! te inter#retation

and a##li&ation of tis A&t1 Te &ir&ulars issued under tis Se&tion sall be bindin! on te

Govern"ent in te exer&ise of its #o%er to &olle&t taxes under tis A&t18 I0 ;9,<9/0+ 4 5?+

;+, 5 */+ ,96+< @,/05+: 7= S. 2 4 5?+ A5" 5?+ 5?+0 G+,0*+05 4 F,9@/6/ +0/5+: 5?+

T/>/50 R96+<" 22. R96+ <+5 5?+ 6++6 4 5/>/50 4, 5?+ ;9,;<+< 4 5?+ A5 /5 / ,/5+ 4

4 5?+ ,+59,0< @+0+,/5+: 5?,9@? 5?+ 0+<5*+05.

VII

I0 <;5+ 4 5?+ ?/0@+ 0 G+,0*+05 0 23" /0: 5?+ ,+<965/05 <?45 0 ;6=" / 4+ /,+/< 4 5?+

6+@/6 <=<5+* 0 F,9@/6/ 0509+: 5 /5 /< ;5+05/6 ?9,:6+< 5 5?+ ;+00@ 9; 4 5?+ +0*= 5

@67/6 /;5/6 046. T?+ ;,?75+ ,/5+ 4 5/>/50 90:+, R96+ 4 5?+ T/>/50 R96+<" 22

4, /0 0<5/0+ /5+: /< / <5,0@ :<0+05+ 5 4,+@0 0+<5*+05. F,+@0 +05+,;,<+< :: 05

<++ 5?+ +0* ,/50/6+ 4 */0@ /0 0+<5*+05 ?+,+ /66 5?+ ;,45< 96: 7+ 5/+0 //= 0

5/>+<. T?+,+4,+" :+<;5+ +05+,0@ 05 / 6/,@+ 09*7+, 4 BIT<" F,9@/6/ 96: 05 /55,/5

<@04/05 4,+@0 0+<5*+05. T?< /< 05+: 7= 5?+ F,9@/6/0 G+,0*+05" ?? 5 /,9<




xi


<5+;< 5 5,= /0: /55,/5 4,+@0 0+<5*+05. F0/66=" 5?+ G+,0*+05 :+:+: 5 +>+*;5 4,+@0

0+<5,< 4,* 5?+ ;9,+ 4 R96+ 4 5?+ T/>/50 R96+<. I0 F+7,9/,= 2)" 5?+ C+05,/6 B/,:

4 T/>/50 <<9+: / ,96/, 'CBT1)#3)( 90:+, S. 1 4 5?+ A5" ?? <5/5+: “ 7t2e %ord

;investor; in S1 < of te A&t does not, in our &onsidered o#inion, in&lude forei!n investors.

VIII

E+0 7+4,+ 5?< ,96/, /< <<9+:" S9;+,-T+? ?/: +05+,+: 05 / 4+ <*/66-</6+

04,/<5,959,+ 05,/5< 5? 5?+ G+,0*+05 4 F,9@/6/. E/? 4 5?+<+ 05,/5< 05/0+:

:<;95+-,+<6950 6/9<+< ,+4+,,0@ :<;95+< 90:+, 5?+ C05,/5 5 / T,790/6 0<5595+: 90:+,

5?+ ICSID" ?? ?++, ?/: 0++, 7++0 0+:.

I

A 09*7+, 4 4,+@0 0+<5,< :+6/,+: 5?/5 5?+= +,+ 05 <944+056= 00+: 7= 5?+ :+6/,+:

5/> +>+*;50 /0: ,+4,/0+: 4,* */0@ /0 0+<5*+05 0 F,9@/6/. S9;+,-T+?" ?++,"

:+6/,+: 0 / ;,+<< 04+,+0+ 5?/5" 0 + 4 5?+ <9+<<496 **+,/6 ,+6/50<?; 5 ?/:

+0=+: 5? 5?+ F,9@/6/0 G+,0*+05 0 5?+ ;/<5" /0: <0+ 4,+@0 0+<5,< ?/: 7++0

:+6/,+: +>+*;5 4,* 5?+ 5/>/50 <5,959,+" 5?+= +,+ ;,+;/,+: 5 9568+ 5?< ;;,5905= /0:

0+<5 0 5?+ F,9@/6/0 +0*=. A< / ,+<965" 0 M/,? 2)" 5?+= 90+6+: / ;6/0 5 0+<5 0+

7660 :66/,< 0 / ;?/<+: */00+, +, 5?+ 0+>5 5?,++ =+/,<" ;,+5+: 5 ,+/; <97<5/05/6 ;,45</5 5?+ +0: 4 5?< ;+,:. T?< 0+<5*+05 <5,959,+ /< /,,+: 95 <9+<<4966=" /0: 0 1<5

J/09/,=" 2 S9;+,-T+? /0090+: 0 / ;,+<< 04+,+0+ 5?/5 5?+, 0+<5*+05 ;6/0 0 F,9@/6/

/< ;,++:0@ 0 <?+:96+ /0: / ;,45 4 5+05= *660 :66/,< /< +>;+5+: 0 5?+ 0+>5

40/0/6 =+/,.

I0 */0@ 5?+ 0+<5*+05" S9;+,-T+? ?/: 05 ,+6+: 0 /0= ;,4+<<0/6 6+@/6 /:+ 0 5?+

<5/59< 4 5?+ ,96/, <<9+: 7= 5?+ C+05,/6 B/,: 4 T/>/50" /< 5 4+65 5?/5 5?+ 6/,4/5,=

,96/, /< <+64-+>;6/0/5,=. S*+ *05?< /45+, S9;+,-T+? ?/: */:+ 5?+ 05/6 0+<5*+05" /

:*+<5 00-@+,0*+05/6 ,@/0</50 0 F,9@/6/ ?/66+0@+: 5?+ 0<55950/65= 4 5?+

,96/, 7= /= 4 / ,5 ;+550 7+4,+ 5?+ S9;,+*+ C9,5 4 F,9@/6/. T?+ C0<55950 4

F,9@/6/ ;,:+< 0 A,5. " 97a2ll la%s, ordinan&es, rules, re!ulations, &ir&ulars, or an' oter




xii


instru"ents, avin! te for&e of la%, "a' be stru&= do%n as un&onstitutional for violatin! te

ri!ts !uaranteed under tis Constitution1 If an' su& instru"ent is stru&= do%n under tis

Arti&le, it sall be void ab initio18 T?+ S9;,+*+ C9,5" 0 / 9:@*+05 :/5+: ) 5? M/=" 2" ?+6:"

,+6=0@ 0 / <+,+< 4 5< ;,+9< 9:@*+05< :+/60@ 5? 5?+ <<9+ 4 ,+/<0/76+ 6/<<4/50"

5?/5 5?+ ,96/, ,+/5+: /0 /,54/6 :<5050 7+5++0 :*+<5 /0: 4,+@0 0+<5,<" /0: 5?/5

<9? / :<5050 /< 05 5+0/76+. T?+ ,96/, /< :+6/,+: 5 7+ 0966 /0: : /7 05 90:+,

A,5. 4 5?+ C0<55950 7+/9<+ 5 6/5+: 5?+ C0<55950/6 ;,<0< @,/050@ 5?+ ,@?5 5

+9/65=.

I

O0 1<5 J90+" 2" 4660@ 5?+ 9:@*+05 4 5?+ S9;,+*+ C9,5" 5?+ T/> D+;/,5*+05 4

F,9@/6/ <+05 / 05+ 5 S9;+,-T+? <5/50@" 97i2n vie% of te Su#re"e Court;s de&ision, Su#er-

Te& &annot &lai" an' exe"#tion as a forei!n investor and is liable to #a' tax a&&ordin! to te

s#e&ified rates. A,:0@6=" 5?+ 5/>/50 :+;/,5*+05 6++: 5/> /5 5?+ ,/5+ 4 /@/0<5

S9;+,-T+? 0 /,:/0+ 5? +<5/76<?+: ;,+:9,+. S9;+,-T+? /;;+/6+: /@/0<5 5?+ :+<0

4 5?+ 5/> /95?,5+< 5 5?+ T/>/50 A;;+66/5+ T,790/6 4 F,9@/6/. O0 15? A9@9<5" 2" 5?+

/;;+/6 /< :<*<<+: 0 *+,5< 7= 5?+ /;;+66/5+ 5,790/6. T?+ 5,790/6 <5/5+: 0 5?< 9:@*+05"

“7t2e &ir&ular as been de&lared to be null and void ab initio1 Tat bein! te &ase, te %ord

;investor; in S1 < of te A&t "ust in&lude, and "ust be ta=en to al%a's ave in&luded, forei!ninvestors1 Clearl' ten, forei!n investors are also %itin te a"bit of te &ar!e of tis tax.

S9;+,- T+? 5?+0 <9@?5 6+/+ 5 /;;+/6 /@/0<5 5?< :+<0 4 5?+ T,790/6" 7+4,+ 5?+ S9;,+*+

C9,5 4 F,9@/6/. O0 5? S+;5+*7+, 2" 5?+ S9;,+*+ C9,5" 0 /,:/0+ 5? 5?+

:<,+50/,= ;+, ;,:+: 5 5 90:+, 5?+ C0<55950 4 F,9@/6/" ,+49<+: 5 /:*5 5?<

/;;+/6 7+/9<+ “te &ase involves no >uestion of la% %i& %ould "erit te ti"e and attention of

tis Court .

II

F660@ 5?+ :+<0 4 5?+ S9;,+*+ C9,5" S9;+,-T+? ?/< /;;,/?+: 5?+ ICSID T,790/6 5

/,75,/5+ 0 5?< :<;95+. S9;+,-T+? ?/< 05 0+: 5?+ ;,<0 4, / P,7/76+ C/9<+ H+/,0@

90:+, A,5. & 4 5?+ BIT. T?+ 40/0/6 0:50 4 S9;+,-T+? < <9? 5?/5 5?/5 /0= //,: /45+,

5?+ +>;,= 4 & *05?<" 0 */55+, ? @+0+,9<" 66 4/6 5 /+,5 40/0/6 ,90" /0: 96:




xiii


5?+,+4,+ 7+ 4 0 9<+ 5 5?+*. S9;+,-T+? < 4 5?+ 0<:+,+: ;00 5?/5 5 ?/< / +,= @:

?/0+ 4 @+550@ / 4/9,/76+ /,75,/6 //,: 7= 5?+ ICSID T,790/6 5?0 / 4+ *05?<.

F,9@/6/ ?/< /6< /@,++: 5 <97*5 5?+ :<;95+ 5 5?+ ICSID T,790/6" 5< 0<+05 7+0@ 6*5+: 5

;+,*550@ 5?+ T,790/6 5 :+5+,*0+ 5< 0 9,<:50. F,9@/6/ ?/< ,+<+,+: 5< ,@?5 5

?/66+0@+ 5?+ 9,<:50 4 5?+ T,790/6.




xiv

-Su""ar' of Pleadin!s-

S--AR% OF ,LEA!IN/S

1.THERE EXISTS A VALID ARBITRATION CLAUSE SHOWING ICSID TO BE THE PREFERRED FORM OF

ARBITRATION.

I5 < <97*55+: 5?/5 5?+,+ +><5< / /6: /,75,/50 6/9<+ 0 5?+ /@,++*+05 +05+,+: 05 7= 5?+

0+,0+: ;/,5+<" ?? 0:/5+: ICSID 5 7+ 5?+ ;,+4+,,+: 4,* 4 /,75,/50. F9,5?+,*,+"

5?+ ;/,5+<" 7= ,59+ 4 5?+ /@,++*+05 05+0:+: ICSID 5 7+ 5?+ 4,9* 4, /,75,/50. M,++,"

5?+ ,+4+,+0+ 5 $R96+< 4 /,75,/50 9<+: 0 W/<?0@50 D.C. ,++/6< 5?+ 0+,0+: ;/,5+<

05+050 5 /,75,/5+ 90:+, ,96+< 5? / <;+4 60 5 W/<?0@50 D.C." .+. ICSID.

2.SUPER -TECH" FOR THE PURPOSE OF THE ICSID CONVENTION IS A R OTUNDIAN NATIONAL.

I5 < <97*55+: 5?/5 4, 5?+ ;9,;<+ 4 5?+ ICSID 0+050" S9;+, T+? < / R590:/0 N/50/6.

F,9@/6/" 7= /660@ S9;+, T+? 5 */+ <*/66 0+<5*+05< 0 5?+ 905,= /+;5+: S9;+, T+?

/< / R590:/0 N/50/6. F9,5?+,*,+" 5?+,+ +><5< / $@+090+ 60% 7+5++0 S9;+, T+? /0:

R590:/" ?? <944+< 5 +<5/76<? 0/50/65=.

3.SUPER -TECH IS ENTITLED TO APPROACH THE ICSID ARBITRAL PANEL DIRECTLY UNDER

ARTICLE 3 OF THE BIT.

T?+ 5+>5 4 A,56+ 3 4 5?+ BIT */0:/5+< 5< /;;6/50 5 all "atters relatin! to &o""er&e /0:

:<;95+ ,+<6950 0 0+<5*+05 */55+,< /66 <9/,+6= 5?0 5< /*75. A,56+ &'2( /0: &'3( <+5 5?+

*0*9* <5/0:/,:< /0: /,+ ;,<0/6 0 0/59,+ /0: /,+ +,-,::+0 7= A,5 3 ?+0 / *,+

4/9,/76+ 5,+/5*+05 0 5?< ,+@/,: < /,:+: 5 / 5?,: S5/5+. A< / ,@?5 5 /;;,/? /0 /,75,/6

5,790/6 :,+56=" / 5,+/5*+05 *,+ 4/9,/76+ 5?/0 ?/5 ?/< 7++0 @,/05+: 5 5?+ R590:/0

0+<5,<" ?/< 7++0 /,:+: 5 0+<5,< 4 / 5?,: S5/5+" A,5 3 +0556+< 5?+ C $AI0ANT 5 5?+ </*+

5,+/5*+05.

#. THE R ESPONDENT%S TAX-MEASURES " TO THE EXTENT THEY CONCERN R OTUNDIAN

I NVESTORS" ARE VIOLATIVE OF $FAIR AND EQUITABLE TREATMENT% OBLIGATION AND IS

VIOLATIVE OF ARTICLE 2 OF THE BIT.




xv

-Su""ar' of Pleadin!s-

T?+ *;9@0+: *+/<9,+ 6/5+< 5?+ 0,*< 4 $<5/765= 4 4,/*+,% /0: $;,5+50 4

6+@5*/5+ +>;+5/50<%. E+0 /<<9*0@ 5?/5 06= 05+,0/50/6 *0*9* <5/0:/,:< 4 4/, /0:

+95/76+ 5,+/5*+05 /,+ */0:/5+: 7= A,5 2" 5 < <97*55+: 5?/5 $;,5+50 4 6+@5*/5+

+>;+5/50<% 4/66< <9/,+6= 5?0 <9? <5/0:/,:<.

0.THE TAX MEASURES OF THE R ESPONDENT AMOUNT TO U NJUSTIFIED EXPROPRIATION U NDER

I NTERNATIONAL LAW AND IS VIOLATIVE OF ARTICLE # OF THE BIT.

T?+ 5/> *+/<9,+< /*905 5 0:,+5 +>;,;,/50 0@ 5 5?+ <97<5/05/6" ;,+9:/6 /0:

;+,*/0+05 0/59,+ 4 5< 05+,4+,+0+ 5? +0=*+05 4 ;,;+,5= /0: +0* /765= 4

;+,/50<. T?+ </*+ < 05 9<54+: /< *;+0</50 ?/< 05 7++0 ;/:. I5 < /6< 05 9<54+: /<

/0 /5 4 0 +>+,<+ 4 ;6+ ;+,< /< 5?+ */55+, :+< 05 4/66 5?0 5?+ /*75 4 <9? ;+,<.

E+0 /<<9*0@ 5?/5 5?+ */55+, 4/66< 5?0 ;6+ ;+,<" 5?+ S5/5+ < ;,+69:+: 4,* +>+,<0@

<9? ;+,< 0@ 5 5< 90:+,5/0@< 5 5?+ 05,/,=.




1

-Pleadin!s and Autorities-

,LEA!IN/S AN! AT'ORITIES

I. There exists a valid arbitration clause showing ICSID tobe the preferred form of arbitration.

I5 < <97*55+: 5?/5 5?+ /,75,/50 6/9<+ 0 5?+ /@,++*+05 7+5++0 F,9@/6/ /0: R590:/

'?+,+0/45+, $5?+ /,75,/50 6/9<+%(" /,56+ &'1(" < /6: /0: 05 : 0 @,90:< 4 90+,5/05=.

F9,5?+,*,+" 5?+ A,75,/6 T,790/6 ?/< 5?+ /95?,5= 5 :+:+ 0 5< 0 9,<:50. W/<?0@50

D.C." 5?+ <+/5 4 ICSID" < /6< 5?+ <+/5 4 :<;95+ ,+<6950 /< ;+, /,56+ &'1( 4 5?+ /,75,/50

6/9<+. S0+ 5?+ /,75,/50 < @+,0+: 7= 5?+ 6/ 4 5?+ <+/5 4 5?+ A,75,/50 T,790/6 1" 5?+

ICSID 0+050" ,96+< /0: ,+@96/50< /;;6+< /< 5?+ lex lo&i arbitri1 P9,<9/05 5 A,56+ #1'1(

4 5?+ </: 0+050" ?? ,+/:< “T?+ T,790/6 <?/66 7+ 5?+ 9:@+ 4 5< 0 *;+5+0+" 5< <97*55+: 5?/5 5?+ A,75,/50 T,790/6 ?/< C*;+5+0+-C*;+5+0+.

I5 < <97*55+: 5?/5 / /6: /,75,/50 /@,++*+05 /0: 5?+ ?+ 4 /,75,/50 ,96+< 5?/5 7+60@ 5

/0 /,75,/6 0<55950 /,+ +<<+05/6 4, 5?+ 5,790/6 5 ?/+ 9,<:50 0 /0 0<55950/68+:

/,75,/50.2 I0 5?+ 0<5/05 /<+" 5?+ ;/,5+< ?/+ /6:6= /@,++: 0 /,75,/50 /0: 5?/5 5?+ 4,9*

4, /,75,/50 < 5?+ ICSID.

I5 66 7+ +<5/76<?+: 5?/5 5?+ A,75,/6 T,790/6 ?/< 9,<:50 7/<+: 0 /,56+ &'1( 4 5?+

;/,5+<% /,75,/50 /@,++*+05 6+/:0@ 5 0<55950/68+: ;,++:0@< 90:+, 5?+ R96+< 4

A,75,/50 ICSID C0+050" R+@96/50< /0: R96+<.

1.1. THE ARBITRATION CLAUSE IN THE AGREEMENT IS VALID.

I5 < <97*55+: 5?/5 5?+ ;,*/,= <9,+ 4 /0 /,75,/6 5,790/6%< 9,<:50 < 5?+ /,75,/50

6/9<+ 0 5?+ /@,++*+05 7+5++0 5?+ 5 ;/,5+<. 3 B= <@00@ /0 /@,++*+05 05/00@ /0 +>;65

/,75,/50 6/9<+" 5?+ ;/,5+< /,+ :++*+: 5 ?/+ /@,++: 0 /,75,/50.#

1 B,0" G/,= B." INTERNATIONAL COMMERCIAL ARBITRATION COMMENTARY AND MATERIALS" 2 ND ED." ARDSLEY"

NEW YOR! " 21" ?+,+0/45+, B,0 ;@. )3.

2 R+:4+,0" A6/0" M/,50" H905+," LAW AND PRACTICE OF INTERNATIONAL COMMERCIAL ARBITRATION" #TH ED." SWEET

MAXWELL" LONDON" 2#. ?+,+0/45+, R+:4+,0H905+,.. 1-"

* R+:4+,0H905+," 'Su#ra" 05+ 2(".1-13K C,/@" L/,+0+" P/," W66/*" P/96<<0" J/0K INTERNATIONAL CHAMBER

OF COMMERCE ARBITRATION" 3RD ED." OCEANA PUBLICATIONS" PARISLONDON 2" ?+,+0/45+,

C,/@P/,P/96<<0. ;. ##.

4 ICC A/,: N. 2321K 9,? C?/*7+, 4 C**+,+" 2) N. 1#




2


I0 5?+ 0<5/05 /<+" 5?+ ,+6+/05 /,75,/50 6/9<+" :+/60@ 5? 5?+ 05+050 4 5?+ ;/,5+<

;,:+< 5?/5-

Article 8- Dispute Resolution

?1 An' dis#ute in &onne&tion %it tis a!ree"ent sall be resolved b' su& International

Arbitration as is a##ro#riate for su& dis#utes, in a&&ordan&e %it te International

Arbitration Rules used in )asin!ton D1C1

T?+ /7+ *+050+: 6/9<+ 90+9/66= <?< 5?/5 5?+ ;/,5+< 05+0:+: /0= :<;95+< /,<0@

95 4 5?< /@,++*+05 sall 7+ ,+<6+: 7= <9? I05+,0/50/6 A,75,/50 /< < a##ro#riate for

su& dis#utes, 0 /,:/0+ 5? 5?+ International Arbitration Rules used in )asin!ton D1C 1@

T?+,+4,+" 5 < <97*55+: 5?/5 5?+ /,75,/50 6/9<+ < /6:. T?+ RESPONDENTS 6/* 5?/5 5?+

/,75,/50 6/9<+ < 90+,5/0 ?/< 7++0 :+/65 5? 0 5?+ 0+>5 <97 05+050.

1.2. THE PARTIES BY VIRTUE OF THE AGREEMENT INTENDED THAT ICSID WOULD BE THE FORUM

FOR ARBITRATION.

I5 < <97*55+: 5?/5 5?+ /,75,/50 6/9<+ 6+/,6= +<5/76<?+< 5?/5 /0= :<;95+ 7+5++0 5?+

0+,0+: ;/,5+< 96: 7+ ,+<6+: 7= I05+,0/50/6 A,75,/50 /< < a##ro#riate for su&

dis#utes, in a&&ordan&e %it te International Arbitration Rules used in )asin!ton D1C1B

T?+ ICSID" ?? /< ,+/5+: 90:+, 5?+ /9<;+< 4 5?+ W,6: B/0" < <+/5+: /5 W/<?0@50

D.C. F9,5?+,*,+" /,56+ 2 4 5?+ ICSID ;,:+< 5?/5 5?+ /,75,/50 ;,++:0@< <?/66 7+ ?+6:

/5 5?+ <+/5 4 5?+ C+05+, '.+. ICSID( 906+<< 5?+ ;/,5+< +>;656= /@,++ 4, ;,++:0@< 5 7+ ?+6:

/5 5?+ <+/5 4 5?+ P+,*/0+05 C9,5 4 A,75,/50 , /0= 5?+, /;;,;,/5+ 0<55950 '/,56+ 3(.

T?+,+4,+" 5 < <97*55+: 5?/5 60@ /5 5?+ ;,<0< 4 5?+ /,75,/50 6/9<+ /0: 0 5?+

/7<+0+ 4 /0=5?0@ 05,/,= ;,:+: 0 5?+ 4/5<" 5?+ 4/5 5?/5 0 ;,+9< /<0< 5?+ </*+

5 ;/,5+< ?/+ +05+,+: 05 /@,++*+05< 5 ,+4+, :<;95+< 90:+, 5?+ 05,/5 5 / 5,790/6

# A00+>9,+" F/5<.

6 Id17I05+,0/50/6 C+05,+ 4, S+556+*+05 4 I0+<5*+05 D<;95+< ?+,+0/45+, ICSID" C0+050<" R+@96/50< /0:

R96+<" //6/76+ 060+ /5 ?55;<:.,6:7/0.,@ICSIDS5/5F6+<7/<:+0-/,?+ICSIDE0@6<?.;:4.




*


0<5595+: 90:+, 5?+ ICSID"&6+/,6= <?< 5?/5 5?+ ;/,5+< 05+0:+: ICSID 5 7+ 5?+ :<;95+

,+<6950 7:=.

1.3 THE REFERENCE TO “R ULES USED IN WASHINGTON D.C. REVEALS THE CONCERNED PARTIES

INTENTION TO ARBITRATE UNDER RULES WITH A SPECIFIC LIN! TO WASHINGTON D.C." I.E. ICSID.

I5 < <97*55+: 5?/5 /,:0@ 5 5?+ ,96+< 4 +44+5+ 05+,;,+5/50" /0 /,75,/50 6/9<+ < 5 7+

05+,;,+5+: 0 / */00+, ?? @+< 5?+ 6/9<+ /0 +44+5" ,/5?+, 5?/0 */0@ 5 :+: 4

*+/00@.

T?+ ,:0@< 4 /,56+ &'1( 4 5?+ /@,++*+05 ,+4+, 5 “I05+,0/50/6 A,75,/50 R96+< 9<+: 0

W/<?0@50 D.C.. I5 < 05+0:+: 5?/5 0 5?+ 0<5/05 /<+ 5?+ :<;95+ < 0+<5*+05 ,+6/5+:" 5?+

/,75,/50 6/9<+ ;,:+< 4, /,75,/50 0 W/<?0@50 D.C. /0: 5?/5 5?+ </*+ 5 ;/,5+< 0 /0+/,6+, 05,/5 ?/: 0<+,5+: / 6/9<+ 5?/5 0+: 5?+ 9,<:50 4 5?+ ICSID 4, /0= :<;95+.

F9,5?+,*,+" 0 5?+ /7<+0+ 4 /0= 5?+, 6/9<+ 0 5?+ 4/5<" 5 /0 7+ </4+6= 04+,,+: 5?/5 5?+

,+4+,+0+ /< 5? ,+@/,: 5 ICSID /0: 05 /0= 5?+, /,75,/6 5,790/6.

I0 GER0AN CO44EE ASSOCIATION, < SEPTE0ER ?::<" 5?+ ;/,5+< 5 5?+ 05,/5

<5;96/5+: /0 /,75,/50 6/9<+ ?? ,+/: /< “ Arbitration. a"bur!, )est Ger"an'8. E+0

5?9@? 5?+,+ /,+ /,9< 9,5< 4 /,75,/50 /55/?+: 5 44++ 5,/:+ ,@/08/50< ,6::+

6+ 5?+ U05+: !0@:* C44++ T,/:+ F+:+,/50" B+6@/0 C44++ I*;,5 A<</50" 795 06=

0+ 0 H/*79,@" 5?+ 5,790/6 0<:+,+: 5 <944+056= 90/*7@99< 5 05/5+ 0<55950/68+:

/,75,/6 ;,++:0@< /0: 5 /;;6= 5?+ /,75,/50 ,96+< 4 5?+ G+,*/0 C44++ A<</50 /5 5?+

H/*79,@ C?/*7+, 4 C**+,+.1

F9,5?+,*,+" 0 U$GARIA COURT O4 ARITRATION, A)ARD NO1 ?@?, 5?+ ;/,5+< 5 5?+

05,/5 ?/: 0<+,5+: /0 /,75,/50 6/9<+ ?? ,+/:-“ All #ossible dis#utes sall be resolved b'

8 F/5<" .&.

( F9?/,:" P?6;;+ +5 /6. INTERNATIONAL COMMERCIAL ARBITRATION" !69+, L/ I05+,0/50/6" T?+ H/@9+"

1" ?+,+0/45+, F9?/,:G/66/,:G6:*/0. #&.

1) P/0/*/0/0 79=+, . P/;9/ N+ G90+/0 <+66+," 'S+;5+*7+, 2&" 12(" R+?5<;,+?90@ /94*/00<?+,

S?+:<@+,?5+" V6. V" S+5. 3B /< 5+: 0 B+,@+," !P" “P+, 4 A,75,/5,< 5 F66 G/;< /0: R+<+ C05,/5< 5

M/+ S+0<+" '21("A,75,/50 I05+,0/50/6" V6 XVII" N. 1" ?+,+0/45+, B+,@+,;;.1-1.




4


te International Arbitration at te ul!arian 4orei!n Ca"ber18 11I0 5?< /<+" 5?+,+ +><5+:

/*7@95= 7+/9<+ 0+5?+, 5?+ C9,5 4 A,75,/50 , 5?+ B96@/,/0 C?/*7+,< 4 C**+,+ /0:

I0:9<5,= +,+ 0/*+: /9,/5+6=. T?+ A,75,/6 T,790/6" ?++," 069:+: 5?/5 <0+ 5?+,+ +,+

0 5?+, 0<55950< 0 B96@/,/ 5 <+556+ 05+,0/50/6 **+,/6 /,75,/50" 5?+ 05+050 4 5?+

05,/50@ ;/,5+< /< 5 ,+4+, 5?+ :<;95+ 5 5?+ B96@/,/0 C?/*7+, 4 C**+,+ /0: I0:9<5,=

/0: 5?/5 5?+ </: 0<55950%< ,96+< <?/66 /;;6=.

T?+,+4,+" 5 < <97*55+: 5?/5 5?+,+ < 0 /*7@95= , 90+,5/05= 0 5?+ /,75,/50 6/9<+.

1.#. THE REFERENCE TO $I NTERNATIONAL ARBITRATION R ULES% DOES NOT INVALIDATE THE

PARTIES% INTENTION TO ARBITRATE UNDER THE ICSID.

I5 < <97*55+: 5?/5 /< ,+5+,/5+: /7+" 5?+ 4/5 5?/5 5?+ ;/,5+< ?<+ W/<?0@50 D.C. /< 5?+ <+/5

4 /,75,/50" 5?/5 5?+ :<;95+ /< 0+<5*+05 ,+6/5+:" 5?/5 5?+ </*+ 5 ;/,5+< ?/: 0<+,5+:

/,75,/50 6/9<+< 0 ;,+9< /@,++*+05< 4, :<;95+< 5 7+ ?+/,: 7+4,+ / 5,790/6 0<5595+:

90:+, 5?+ ICSID" /0: 0 5?+ /7<+0+ 4 /0= 5?+, 6/9<+ 5 5?+ 05,/,=" 5 /0 7+ </4+6= 04+,,+:

5?/5 5?+ 0+,0+: ;/,5+< 05+0:+: 4, 5?+ 0<5/05 :<;95+ 5 7+ /:9:/5+: 9;0 7= 5?+ ICSID.

T?+,+4,+" 5?+ *+,+ :44+,+0+ 0 5?+ 0/*+< 4 /,75,/50 ,96+< :+< 05 0/6:/5+ 5?+ ,+/6

05+050 4 5?+ ;/,5+<" 0, :+< 5 */+ 5?+ /,75,/50 6/9<+ : 0 @,90: 4 90+,5/05=. 12

2. Super-Tech, for the purpose of the ICSID convention is aotundian !ational.

I5 < <97*55+: 5?/5 4, 5?+ ;9,;<+ 4 5?+ ICSID 0+050" S9;+, T+? < / R590:/0 N/50/6.

F,9@/6/" 7= /660@ S9;+, T+? 5 */+ <*/66 0+<5*+05< 0 5?+ 905,= /+;5+: S9;+, T+?

/< / R590:/0 N/50/6. F9,5?+,*,+" 5?+,+ +><5< / $@+090+ 60% 7+5++0 S9;+, T+? /0:

R590:/" ?? <944+< 5 +<5/76<? 0/50/65=.

11 ul!arian S#ort Or!anisation v1 Gree= S#orts Or!anisation, 'D++*7+, 3" 1&#(" 'A/,: N. 1)11&#("

Y+/,7 4 C**+,/6 A,75,/50" V6 XV" ;@. 3.

12 A v 1G"b, Interi" A%ard 'A9@9<5 2" 1(" G+0+/ C?/*7+, 4 C**+,+ /0: I0:9<5,=" ASA B966+50" V6.

XIX" N. 2" 21KV+,+05<" G+,@+" 9Arbitrators and Contra&tual Ga#s8, '1&&("J9,0/6 4 I05+,0/50/6

A,75,/50" V6. V" N. 3" ;;.13-11.




#


2.1. FRUGALIA IS ESTOPPED FROM TA!ING ACTION AGAINST SUPER TECH.

I5 < <97*55+: 5?/5 / 4,+@0 0+<5, 96: 0+<5 0 F,9@/6/ 06= 7= ,59+ 4 5?+ BIT.

P/,/@,/;? 5 4 5?+ 4/5< ,+/:<-“A< / ;/,5 4 5?< ;6=" 5?+ @+,0*+05 /@,++: 5 ;+0 9; 5?+

+0*= 5 4,+@0 0+<5*+05" /0: accordingly entered into a nu"ber of ilateral Invest"ent

Treaties ereinafter ITF %it different nations1 Tis %as to enable a ra#id inflo% of funds into

te &ountr'8?H

T?+ F,9@/6/0 +0*=" /5 5?/5 ;05 4 5*+ /< / <5/@0/50@ 0+. T?+,+ /< :+<;,+/: 4/*0+

0 5?+ 905,=.1# T?+ G+,0*+05 <5/,5+: +05+,0@ 05 BIT%< 4,* 2#. T?< ;6= /< 5/+0 5

/669,+ 4,+@0 0+<5,< 5 5?+ 905,= 7= @0@ 5?+* +,5/0 7+0+45< 90:+, 5?+ BIT. I5 < /0

+<5/76<?+: ;,0;6+ 4 +0*< 5?/5 ?+0 5?+ +0*= < 0 ,++<<0" 5?+ 0+<5, 96:

;,+4+, ++;0@ ?< /<<+5< 5? ?* ,/5?+, 5?/0 0+<50@ 0 5?+ <5/@0/50@ +0*=.

T?+,+4,+" 5 < <97*55+: 5?/5 4,<56=" 5?+,+ /< / 6/ 4 4,+@0 0+<5*+05< 7+5++0 23 /0:

F+7,9/,=" 2#" ?? ;,*;5+: 5?+ @+,0*+05 5 +05+, 05 BIT%<" /0: <+0:6=" 5?+ ,:0@<

4 5?+ 4/5<" “and accordingly entered into8/0: 5?+ ,:0@< 0 ;/,/@,/;? <++0 4 5?+

4/5< ?? ,+/:<-“despite entering into a large number of BITs, Frugalia could not attract

significant foreign investment. 0:/5+< 5?/5 5?+ ;,+<< 4 ;+00@ 9; 4 5?+ +0*= /<

06= 5?,9@? 5?+ BIT< /0: 5?/5 BIT< +,+ 5?+ only *+/0< 4 4,+@0 0+<5*+05. '+*;?/<<

/::+:(

S0+ 5 ?/< 7++0 +<5/76<?+: 5?/5 5?+ 06= 6+@/6 /= 4, 4,+@0 0+<5,< 5 0+<5 0 F,9@/6/

/< 7= /= 4 5?+ ;,<0< 4 5?+ BIT" 5 < <97*55+: 5?/5 7= /660@ S9;+, T+? 5 */+

0+<5*+05< 0 F,9@/6/" 5?+ F,9@/6/0 @+,0*+05 /+;5+: 5?+ </: *;/0= /< / 0/50/6 4

R590:/ /< 5?+,+ /< 0 5?+, /= S9;+, T+? 96: ?/+ 0+<5+: 0 F,9@/6/ :9+ 5 5?+

/7<+0+ 4 / BIT 7+5++0 F,9@/6/ /0: E0+*/.

T?+,+4,+" 5 < 05+0:+: 5?/5 F,9@/6/ < +<5;;+: 4,* ?/66+0@0@ 5?+ 0/50/65= 4 S9;+,-

T+? 7+0@ R590:/0. 5 < <97*55+: 5?/5 F,9@/6/ ?/: 5?+ ;50 5 05 /66 05/6 0+<5*+05<

*/:+ 7= S9;+, T+?. I5 ?++," :: 05 7+5 5 5?+ </*+. F9,5?+,*,+" 5 /66+: S9;+, T+?

1* F/5<" .2.

14 Ibid1




6


5 */+ / */<<+ 0+<5*+05 4 O0+ B660 D66/,<. T?< 0+<5*+05 /< */:+ 0 5?+ 7/<< 4

5?+ ,96/, <<9+: 7= 5?+ F,9@/6/0 C+05,/6 B/,: 4 T/>/50" ??" 90:+, S. 1 4 5?+

T/>/50 4 I0+<5*+05 A5" 21" +,+ 70:0@ 0 5?+ G+,0*+05.1)

I5 < <97*55+: 5?/5 5?+ 4/5 5?/5 5?+ ,+59,0< 4,* 5?+ 0+<5*+05 +,+ 5 7+ 5/>+:" *+/0< 5?+

0+<5*+05 /< 6+@/6" /0: 4, 5?+ 0+<5*+05 5 7+ 6+@/6" 5 ?/: 5 7+ 90:+, 5?+ ;,<0< 4 5?+

BIT. T?+,+ +><5+: 0 BIT< 7+5++0 F,9@/6/ /0: E0+*/ /0: F,9@/6/ /0: G,+@/,/. T?<

*;6+< 5?/5 5?+ F,9@/6/0 @+,0*+05 /+;5+: S9;+, T+? /< / 0/50/6 4 R590:/ /0:

5?+,+4,+ /66+: 5?+* 5 0+<5 0 5?+ 905,=" /0: <0+ 5 /66+: 5?+ </*+" 5 < +<5;;+: 4,*

?/66+0@0@ 5?+ 0/50/65= 4 S9;+, T+?.

2.2. SUPER TECH" FOR THE PURPOSE OF THE ICSID" IS A NATIONAL OF R OTUNDIA.

I5 < <97*55+: 5?/5 0/50/65= < “a le!al bond avin! as its basis a so&ial fa&t of atta&"ent, a

!enuine &onne&tion of existen&e, interests and senti"ents, to!eter %it te existen&e of

re&i#ro&al ri!ts and duties18?B

T?+ ICJ 0 ar&elona Tra&tion &ase? 0<:+,+: 5?+ 0+;5 4 0/50/65= 4 / ,;,/50 /0:

6/: :0 5?+ ,96+ 5?/5 5?+ 0/50/65= 4 / ,;,/50 < 5 7+ :+,5+,*0+: 7= 5?+ 5<

0,;,/50" ?++, ,+@080@ *;6+:6= +,5/0 +>+;50< 5 5?+ </: ,96+. T?+ 6+@/6

;<50 /< +<5/76<?+: 7= ar&elona Tra&tion ?/< 7++0 :4+: 7= 5?+ I05+,0/50/6 L/

C**<<0 '?+,+0/45+, ILC( /<-“ 4or #ur#oses of di#lo"ati& #rote&tion of &or#orations, te

State of nationalit' "eans te State under %ose la% te &or#oration %as for"ed and %ose

territor' it as re!istered offi&e or t!e seat of its management or some similar connection.1&

I5 < <97*55+: 5?/5 0 5?+ 0<5/05 /<+" M/@0/ T+? 0+: <?/,+< 0 S9;+, T+? /0: ?/: 5?+

;+, 5 /;;05 5?,++ 95 4 4+ 7/,: 4 :,+5,<" *;6=0@ 5?+ <+/5 4 +44+5+ 05,6 /0:

1# F/5<" . .

16 Nottebo" Case $ie&tenstein v1 Guate"ala F" ICJ R+;,5<" 1))" ;;. #" 23.

17 ar&elona Tra&tion, $i!t and Po%er Co1 se&ond #aseF el!iu" v1 S#ainF 1 I.C.J." 3" 'F+7. )( ?+,+0/45+,

ar&elona Tra&tion Case21

18I05+,0/50/6 L/ C**<0" Re#ort of te International $a% Co""ission, )5? S+<<." U.N. D. A)1 /5 13

'M/= 3- J90+ #/0: J96= ) 5 A9@9<5 " 2# '?+,+0/45+, 2# I$C REPORTFJ L++" L/,+0+ J." “ ar&elonatra&tion in te <? st &entur'. revisitin! its &usto"ar' and #oli&' under#innin!s H@ 'ears later "'2( #2" STAN. J.INT%L LAW 2#).




7


*/0/@+*+05 7+0@ R590:/. T?+,+4,+" 5 < 05+0:+: 5?/5 5?+,+ < / 00+50 4 5?+ <,5 /<

+0</@+: 7= 5?+ ILC /0: / $@+090+ 60% 7+5++0 5?+ C6/*/05 /0: R590:/.

H+0+ 5 < <97*55+: 5?/5 5?+ C6/*/05 4, 5?+ ;9,;<+< 4 5?+ ;,+<+05 ;,++:0@< < 5 7+

0<:+,+: / R590:/0 N/50/6.

1. S,ER 2TEC' IS ENTITLE! TO A,,ROAC' T'E ICSI! ARBITRAL ,ANEL !IRECTL% N!ER

ARTICLE 1 OF T'E BIT

I5 < <97*55+: 5?/5 5?+ C $AI0ANT < +0556+: 5 /;;,/? 5?< ;/0+6 :,+56= 055?<5/0:0@ 5?+ ;,<0<

4 A,56+ &'2( /0: &'3( 4 5?+ A!ree"ent bet%een te Re#ubli& of 4ru!alia and te De"o&rati& Re#ubli&

of Rotundia for te Pro"otion and Prote&tion of Invest"ents and te En&oura!e"ent and Re&i#ro&al

Prote&tion of Invest"ents '?+,+0/45+," 5?+ BIT(. T?9@? C6/9<+< &'2( /0: &'3( 4 5?+ BIT ;,+<,7+$;,7/76+ /9<+ ?+/,0@% /< / ;,+0:50 4, /,75,/50" 5?+ :+ /*75 /,:+: 5 A,56+ 3 4 5?+ BIT

7= 5?+ C ONTRACTING P ARTIES +>5+0:< *<5 4/9,/76+ 0/50 '?+,+0/45+," MFN( 5,+/5*+05 5 all "atters

relatin! to &o""er&e" 069:0@ :<;95+ ,+<6950 ;,+:9,+ /0: */0:/5+< 5?+ +>5+0<0 4 5?+ *,+

4/9,/76+ 5,+/5*+05 0 :<;95+ <+556+*+05 ;,+:9,+ /,:+: 7= F,9@/6/ 5 0+<5,< 4 +,5/0 5?+,

S5/5+< 5 7+ +>5+0:+: 5 5?+ R590:/0 0+<5,<.

3.1. OBLIGATION OF MOST FAVOURED NATION TREATMENT EXTENDS TO DISPUTE R ESOLUTION

PROCEDURES

T?+ C $AI0ANT <97*5< 5?/5 '1( 5+>59/6 05+,;,+5/50 < 5 7+ /,:+: 5 5?+ ;,<0< 4 A,56+ 3 4 5?+

BIT" '2( 5+>59/6 05+,;,+5/50 0 @: 4/5? 4 5?+ A,5 3'1( /**:/5+< :<;95+ <+556+*+05 ;,+:9,+

5?0 5< /*75. I5 < 49,5?+, <97*55+: 5?/5 A,5 & 4 5?+ BIT :+< 05 6*5 5?+ <;+ 4 A,5 3 /0: 5?/5 /0=

0<5,950 5 5?+ 05,/,= 66 4,9<5,/5+ 5?+ 7/< 7+5+< 4 5?+ MFN 6/9<+.

3.1.1. Textual inter#retation is to be a&&orded to te #rovisions of te IT

I05+,0/50/6 6/ /55,795+< ;,*/= 5 / 5+>59/6 *+5?: 4 5,+/5= 05+,;,+5/501 0 6@?5 4 5?+ 7+5 /0:

;9,;<+ 4 5?+ 5,+/5=.2 T?< *+5?: */0:/5+< 5?/5 5?+ 5+,*< 4 5?+ 5,+/5= /,+ 5 7+ @+0 5?+, ,:0/,=

1(

VIENNA CONVENTION ON THE LAW OF TREATIES" M/= 23"1" /,5. 31" 11)) U.N.T.S." 331" U.N. D.AC04.32 '1( ?+,+0/45+, (1C1$1T1K M.N. S?/" I NTERNATIONAL LAW &3" '23(K OPPENHEIM%S

I NTERNATIONAL LAW" 122 'J+000@< W/55<"+:( '1(K G. F58*/9,+" “(ae (i&ti& or )oe to te Ne!otiators*

+our Treat' or our inter#retation of it8 3 A.J.I..L. ) '11(K I. S06/," “Te Prin&i#les of Treat' Inter#retation

and teir A##li&ation b' te En!lis Courts8, 3 I.C.L.Q. 12 '13(.

2) Air Trans#ort Servi&es A!ree"ent Arbitration" 'U1S1A1 v1 4ran&eF, '13( ILR 3&" ;;. 1&2" 22& K Ital'-United

States Air Trans#ort Arbitration" '1)( ILR #)" ;;. 33" #12-13K Sout )est Afri&a &ases $iberia v1 Sout Afri&aF"

12 ICJ 33K Re Co"#eten&e of Con&iliation Co""ission, '1))( ILR 22" ;;. &" &1K Italian Re#ubli& v1 4ederal

Re#ubli& of Ger"an', '1)( ILR 2" ;;. ##2" #K Gree&e in bealf of A#ostilidisF v1 4ederal Re#ubli& of




8


*+/00@ 5? :9+ ,+@/,: 5 5?+ ;9,;<+ 4 5?+ 5,+/5=. 21 T?< /;;,/? ?/< 7++0 +<;9<+: 0 09*+,9<

:+<0<22 4 5?+ I05+,0/50/6 C9,5 4 J9<5+ ereinafter I.C.J. /0: < +66 +<5/76<?+: 0 9<5*/,=

05+,0/50/6 6/.23

3.1.2. Textual inter#retation of te 04N &lause a&&o""odates dis#ute settle"ent %itin itsa"bit

A,56+ 3'1( 4 5?+ BIT */0:/5+< 5?+ +>5+0<0 4 MFN 5,+/5*+05 5 $/66 */55+,< ,+6/50@ 5 **+,+%. 2#

T?+ </: ;?,/<+ < 4 :+ *;,5 /0: < /;/76+ 4 ?6:0@ 5?0 5< /*75 /66 */55+,< 7+/,0@ /

,+6/50<?; 5? **+,+" 069:0@ :<;+0</50 4 9<5+. It is true tat te Kad"inistration of

3usti&e, %en vie%ed in isolation, is a sub3e&tL"atter oter tan K&o""er&e F, but tis is not

ne&essaril' so %en it is vie%ed in &onne&tion %it te #rote&tion of te ri!ts of traders1 Prote&tion of

te ri!ts of traders naturall' finds a #la&e a"on! te "atters dealt %it b' treaties of &o""er&e 111F

Terefore it &annot be said tat te ad"inistration of 3usti&e, in so far as it is &on&erned %it te #rote&tion of tese ri!ts, "ust ne&essaril' be ex&luded fro" te field of a##li&ation of te "ostLfavoredL

nation &lause, %en te latter in&ludes Kall "atters relatin! to &o""er&e F%2) C0<96/, 9,<:50 /0:

/+<< 5 9<5+ ?/< /6/=< 7++0 0<:+,+: +<<+05/6 4, 5?+ ;,5+50 4 ,@?5< 4 5,/:+,< /0:" ?+0+"

+,+ ,+@/,:+: 05 *+,+6= /< ;,+:9,/6 :++< 795 /< /,,/0@+*+05< :+<@0+: 5 7+55+, ;,5+5 5?+ ,@?5<

4 <9? ;+,<0< /7,/:" *;6=0@ 5?/5 <9? /,,/0@+*+05<" ++0 4 05 <5,56= / ;/,5 4 5?+ */5+,/6 /<;+5

Ger"an'" '1( ILR 3#" ;;. 21" 2#1K M N/," THE LAW OF TREATIES" 3) '11(K S. V+<+6" Clearin! a Pattrou! a Tan!led 3uris#ruden&e. 0ost-4avoured-Nation Clauses and Dis#ute Settle"ent Provisions in ilateral

Invest"ent Treaties" 32 YALE J. I NT%L L. 12) '2(.

21 I. S06/," 'Su#ra, 05+ 1 FK N:+ !4+6+-!/6" Assertin! Per"anent Soverei!nt' over An&estral $ands. Te

a%er=i $and $iti!ation a!ainst Ca"eroon, 13 A NN. SURV. I NT%L COMP. L. 13 '2(K Re#orts of te

International $a% Co""ission to te General Asse"bl'" 1 2. Y.B. I NT%L L. COMM% N 21&" U.N. DA3R+. 11.

22 Co"#eten&e of te General Asse"bl' for te ad"ission of a State to te United Nations, Se&ond Ad"issions

CaseF, 1) ICJ &K Y+/,7 4 5?+ I05+,0/50/6 L/ C**<<0" 1" V6. 2" ;. 21" ;/,/ ). A009/,/ :+ L%

I0<5595 :+ D,5 I05+,0/50/6" V6. ##" T*+ 1 '1)2(" ;. 1K T.O. E6/<" THE MODERN LAW OF TREATIES" 3 ,

Sout )est Afri&a Cases Se&ond PaseF 1 ICJ .

2* Certain Ex#enses of te United Nations Arti&le ?, #ara!ra# <, of te CarterF " 12 ICJ 1)& K Se&ond Ad"issions Case" ICJ R+; '1)(" ;. &K 4ri!erio v1 4ederal De#art"ent of Trans#ort " '1&(" ILR" 2" ;. K

el!iu" et al v1 4ederal Re#ubli& of Ger"an' +oun! $oan ArbitrationF" '1&(" ILR" )" ;;. #)" )2K Restri&tions

to te Deat Penalt', '1&3(" ILR" " ;;. ##" #.

24 A00+>9,+" F/5<.2)

A"batielos Clai", Gree&e v United /in!do",F, M+,5<" 1)3" ICJ R+; 1K E"ilio A!ustMn 0affeini v S#ain"

D+<0 0 O7+50< 5 J9,<:50" ICSID C/<+ N ARB" IIC &) '2( 2) J/09/,= 2




(


4 5?+ 5,/:+ /0: 0+<5*+05 ;6= ;9,<9+: 7= 5,+/5+< 4 **+,+" +,+ +<<+05/6 4, 5?+ /:+9/5+

;,5+50 4 5?+ ,@?5< 5?+= <9@?5 5 @9/,/05++.2

I0 6@?5 4 5?+ 4,+@0@ 5 < <97*55+: 5?/5 5?+ 5+>5 4 A,56+ 3 0 5< ;6/0 *+/00@ 0 @: 4/5?

/**:/5+< :<;95+ ,+<6950 ;,+:9,+ 5?0 5< /*75 /0: */0:/5+< MFN 5,+/5*+05 0 ,+<;+5 4 5?+ </*+.

3.2. PROVISIONS OF ARTICLE &'2( A ND &'3( DO NOT LIMIT THE SCOPE OF ART 3 OF THE BIT

I5 < <97*55+: 5?/5 ;,<0< 4 A,5 &'2( /0: &'3( /005 7+ </: 5 7+ / 6*5/50 0 5?+ <;+ 4 A,5 3

/< 5?+ </*+ ?/+ 7++0 :+<@0+: 5 7+ ;,<0/6 0 0/59,+ @+,00@ :<;95+ <+556+*+05 ;,++:0@< 9056

/ *,+ 4/9,/76+ 5,+/5*+05 0 5?< ,+@/,: < /,:+: 7= 0+ 4 5?+ CONTRACTING PARTIES 5 5?+

0+<5,< 4 / 5?,: S5/5+.

3.2.1. Provisions of Art <F and HF are Provisional in Nature and are over-ridden ' Arti&le Hif 0ore 4avourable Treat"ent in Dis#ute Resolution is extended to a Tird Countr'

T?+ 05+050 4 ;/,5+< 5?/5 5?+ MFN C6/9<+ <?/66 ?6: 5?0 5< /*75 ++0 :<;95+ <+556+*+05

;,+:9,+< < +:+05 4,* 5?+ 9<+ 4 5?+ ;?,/<+ $/66 */55+,< ,+6/50@ 5 **+,+% /< ?/< 7++0 <944+056=

/<+,5/0+: 0 5?+ 4,+@0@ <97*<<0. G+0 5?<" 5 < <97*55+: 5?/5 5?+ :<;95+ <+556+*+05 *+?/0<*

/< +0</@+: 90:+, A,5 & /< :+<@0+: 5 ;,:+ /+<< 5 5?+ 0+<5,< 4 0+ CONTRACTING PARTY

0 5?+ 5+,,5,= 4 5?+ 5?+, 06= < 60@ /< / *,+ 4/9,/76+ *+?/0<* < //6/76+ 5 5?+* 7=

;+,/50 4 A,56+ 3. A0 /0/6@= 0 5?< ,+@/,: /0 7+ :,/0 4,* 5?+ WTO ;,/5+ ?+,+7= +/?

M+*7+, 90:+, 5< GATT <?+:96+ +06<5< 5?+ 790: ,/5+ 4 5/,44< /;;6/76+ 5 5?+ 5?+, M+*7+,<.2

T?9@? 5?+ 790: ,/5+< :+5+,*0+ 5?+ 5/,44 76@/50< 4 5?+ M+*7+,<" 5?+ +>5+0<0 4 / *,+

4/9,/76+ 5,+/5*+05 5 / 5?,: ;/,5= 7= / M+*7+, +0556+< /66 5?+, M+*7+,< 5 5?+ </*+ 5,+/5*+05. 2&

S*6/,6=" 0 5?+ 0<5/05 */55+, A,56+ & 6/=< :0 / 0+@5/5+: /0: /+;5+: ;,+:9,+ 4, <+556+*+05 4

:<;95+<. B95 5?+ </*+ 6<+< <@04/0+ ?+0 5?+ ;+,/50 4 A,56+ 3 +0556+< 5?+ ;/,5= 5 / *,+

4/9,/76+ ;,+:9,+.

26 E"ilio A!ustMn 0affeini v S#ain" Id1

27 A,5. 2" General A!ree"ent on Tariff and Trade, 1#K )TO, EC L Ex#ort Subsidies on Su!ar " R+;,5 4 5?+ P/0+6"

'1) O57+, 2#(" WTDS2)" 2" 2&3R

28 A,5 I" GATT 1#




1)


3.2.2. Considerin! te Provisions of Arti&le <F and HF as "andator' %ill frustrate te

o#eration of te 04N &lause

A0 MFN 6/9<+ < 0<+,5+: 05 /0 /@,++*+05 5? / + 5 ;,++05 7+0+45 +,<0. I5 < <97*55+: 5?/5 /

4/9,/76+ 5,+/5*+05 < 7+0+4/6 06= 4 5 :,+56= , 0:,+56= 04+,< / */,+5 /:/05/@+. 2 C905,+<

0<+,5 MFN 6/9<+< 05 05+,0/50/6 5,+/5+< 5? / + 5 ;,++05 5?+ 5?+, ;/,5= 4, +>5+0:0@ *,+

4/9,/76+ 5,+/5*+05 5 / 5?,: 905,= 5?+,+7= :+;,0@ 5?+ 4,*+, 4 / */,+5 +:@+ 5 ?/< <+9,+: 0

+>?/0@+ 4, +,5/0 ,+;,/6 0+<<0<.3 I0 5?+ 0<5/05 */55+," 4 A,56+< &'2( /0: &'3( /,+

0<:+,+: */0:/5,= 055?<5/0:0@ 5?+ /7<+0+ 4 <9? 6/9<+< 0 5?+ /@,++*+05< 7+5++0 5?+

RESPONDENT /0: 5?,: S5/5+<" 5?+ 0+<5,< 4 5?,: S5/5+< 66 ?/+ 7+55+, /+<< 5 /,75,/50 /0:

?+0+ 7+55+, ;,5+50 4, 5?+, 0+<5*+05< ?6+ R590:/0 0+<5,< /,+ /,:+: 6+<<+, ;,5+50 /0:

/,+ +>;<+: 5 ?@?+, ,<<. T?< 5/5+< 5?+ ;9,;<+ 4 5?+ MFN 6/9<+ 7= 5/0@ //= /0= */,+5

/:/05/@+ 04+,,+: 9;0 R590:/0 0+<5,< 7= 5?+ BIT /0: ,+<9650@ 0 $7+0+45 +,<0%.

3.3. THE PROCEDURE LAID DOWN BY ARTICLE &'2( AND '3( IS LESS FAVOURABLE THAN THAT

ACCORDED TO I NVESTORS OF OTHER COUNTRIES

A ,@?5 5 /;;,/? /0 /,75,/6 5,790/6 :,+56= 5?95 *;6=0@ 5? ;,+-,+9<5+< < / 5,+/5*+05 *,+

4/9,/76+ 5?/0 / ,@?5 5 /;;,/? /0 /,75,/6 5,790/6 050@+05 9;0 5?+ *;6/0+ 5? ;,+-

,+9<5+<.31 I5 < <97*55+: 5?/5 /0 /:/05/@+ , 7+0+45 < 5 7+ 9:@+: 5? ,+<;+5 5 5?+ ,+;+05 /0:

05 5? ,+<;+5 5 5?+ ;/,5= @,/050@ 5.32 I0 5?+ 0<5/05 */55+," 5? ,+4+,+0+ 5 5?+ R590:/0 0+<5,<

0 @+0+,/6 /0: S9;+,-T+? 0 ;/,596/," :<;95+ <+556+*+05 *+?/0<* +0</@+: 0 A,56+ & 4 5?+ BIT

+>;<+< 5?+ 0+<5, 5 / 5 46: ;,++:0@ ?? 06+< 900++<</,= :+6/= ?? 0 59,0 *;6+< /

:</:/05/@+9< */,+5 ;<50. H+0+" 5 < <97*55+: 5?/5 5?+ 5,+/5*+05 /,:+: 5 5?+ R590:/0

0+<5,< 7= ,59+ 4 A,56+ &'2( /0: '3( < 6+<< 4/9,/76+ 5?/0 5?/5 /,:+: 5 5?+ 0+<5,< 4 5?,:

S5/5+<.

2( WTO" Canada L 0easures Affe&tin! te Ex#ort of Civilian Air&raft " R+;,5 4 5?+ A;;+66/5+ B:=" '1 M/,?

1( WTDS1ABR /0: WTDSABR

*) R7+,5 . L/,+0+" A Ne% Co"#ensation 0e&anis" for Preferen&e Erosion in te Doa Round " //6/76+

060+ /5 ?55;.+.*;976/50<;/;+,<6/,+0+1-##.;:4

*1 E"ilio A!ustMn 0affeini v S#ain" 'Su#ra, 05+ 2) F1

*2 Canada L Air&raft " 'Su#ra, 05+ 2(.




11


". The espondent#s Tax-$easures, to the %xtent the& Concernotundian Investors, are 'iolative of ()air and%*uitable Treatment# +bligation and is violative of rticle 2 of the IT

I5 < <97*55+: 5?/5 5?+ 5/> *+/<9,+< 4 5?+ RESPONDENT 5 5?+ +>5+05 5?+= 0+,0 S9;+,-T+? /,+

6/5+ 4 5?+ A,56+ 2 4 5?+ BIT /< 5?+ 76@/50< /,<0@ 95 4 5?< ;,<0 069:+ 05 06= 5?+

05+,0/50/6 *0*9* <5/0:/,:< 4 4/,0+<< /0: +95= 795 /6< 069:+< / 09*7+, 4 5?+, +6+*+05<

?? 5?+ T,790/6 < *;+5+05 5 :+:+ 9;0" 069:0@ 5?+ <5/765= 4 ,+@96/5,= 4,/*+, /0:

;,5+50 4 6+@5*/5+ +>;+5/50<. I0 5?+ /65+,0/5+" ++0 /<<9*0@ 5?/5 5?+ 76@/50 /<5 7= 5?+ </:

;,<0 < 040+: 5 5?+ 05+,0/50/6 *0*9* <5/0:/,:<" 5 < <97*55+: 5?/5 5?+ </: +6+*+05< 4

<5/765= 4 4,/*+, /0: ;,5+50 4 6+@5*/5+ +>;+5/50< /0 7+ /**:/5+: 4/,6= 5?0 <9?

*0*9* <5/0:/,:<.

#.1. THE OBLIGATION U NDER ARTICLE 2 OF THE BIT IS NOT LIMITED TO I NTERNATIONAL

MINIMUM STANDARDS

I5 < <97*55+: 5?/5 / 5+>59/6 05+,;,+5/50 4 5?+ ;,<0< 4 A,56+ 2 0 @: 4/5? /0: 0 6@?5 4 5?+

7+5 /0: ;9,;<+ 4 5?+ /@,++*+05 /< +:+0+: 7= 5?+ P,+/*76+ /,:< 5 5 / <;+ 5?/5 < 05 6*5+:

5 5?+ 05+,0/50/6 *0*9* <5/0:/,:< 4 $4/, /0: +95/76+ 5,+/5*+05%. T?+ 05+,0/50/6 *0*9*

<5/0:/,:< /,+ *+/05 5 ,+/5+ / 46," 795 05 / +60@ 33 /0: 5?+ 6/9<+ 0 9+<50" 05+,;,+5+: 0 6@?5 4

5?+ 7+5< /0: ;9,;<+ 4 5?+ BIT /< +:+05 4,* 5?+ P,+/*76+ ,+/5+< /0 76@/50 9;0 5?+ ;/,5+< 5+0<9,+ <5/765= 4 0+<5*+05 4,/*+, /0: /,: ;,5+50 5 6+@5*/5+ +>;+5/50<.

#.1.1. Provisions of te Treat' are to be Inter#reted Textuall' in Good-fait and in li!t of te

Ob3e&t and Pur#ose of te Treat' as Eviden&ed b' te Prea"ble

T?+ ,:< 4 / 5,+/5= /,+ 5 7+ /,:+: 5?+, ;6/0 *+/00@ 0 @:-4/5?3# /0: /,+ 5 7+ 05+,;,+5+: 0

6@?5 4 5?+ 7+5 /0: ;9,;<+ /0: 05+>5 4 5?+ 5,+/5=3). T?+ 9<+4960+<< 4 5?+ P,+/*76+ 0 /<+,5/00@

** Aurix Cor#oration v1 Ar!entine Re#ubli& 5urisdi&tionF " 2# #3 ILM 22 'ICSID" 23" S9,+:/" P L/95+,;/?5

M/,50<( .31.

*4 A,5 31'1(" VCLT.

*# Re#ubli& of E&uador v1 O&&idental Ex#loration and Produ&tion Co,1 2) EWCA C 111K 2 #32 'CA(K

AdT SA v1 Re#ubli& of olivia 5urisdi&tionF, '2)( ICSID R+-FLJ #) 'ICSID 2)" C/,0 P" A67+,,-S+*+,+0/

A6/,+8(.




12


5?+ 7+5 /0: ;9,;<+ 4 5?+ 5,+/5= < +66 +<5/76<?+: 0 05+,0/50/6 6/.3 I5 < <97*55+: 5?/5 A,56+ 2

4 5?+ BIT < 5 7+ 05+,;,+5+: 0 ;6/0 *+/00@ 0 @: 4/5? /0: 0 5?+ 6@?5 4 5< P,+/*76+.

#.1.2. Arti&le < of te IT Inter#reted Textuall' in $i!t of te Ob3e&t and Pur#ose 0andates

Stabilit' of 4ra"e%or= I5 < <97*55+: 5?/5 0 05+,0/50/6 0+<5*+05 6/" 4/, /0: +95/76+ 5,+/5*+05 < 0<+;/,/76+ 4,*

<5/765= /0: ;,+:5/765=.3 T?+ ;,+/*76+ 4 5?+ BIT *+050< <5/765= 4 0+<5*+05 4,/*+, 0 5?+

05+>5 4 4/, /0: +95/76+ 5,+/5*+05.3& T?+ ICSID ;/0+6< ?6+ 05+,;,+50@ $F/, /0: E95/76+

T,+/5*+05% 6/9<+< 0 /@,++*+05< 05/00@ P,+/*76+< #ari "ateria 5? 5?+ </: 6/9<+ ?/+ ?+6: 5?/5

<5/765= 4 “le!al and business environ"ent 3 < /0 +<<+05/6 4+/59,+ 4 4/, /0: +95/76+ 5,+/5*+05 /<

05+,;,+5+: 0 6@?5 4 5?+ 7+5+< 4 5?+ 5,+/5=. #

#.1.3 K4air and E>uitable Treat"ent 0andates Prote&tion of $e!iti"ate Ex#e&tations1

I5 < +66 +<5/76<?+: 5?/5 4 / ;976 7:= ?/< 6+: /0 +055= 5 7+6++ 5?/5 5?+ 6/55+, 66 ?/+ / ;/,596/,

,@?5" +, /0: /7+ 5?/5 @+0+,/66= ,+9,+: 7= 5?+ ;,0;6+< 4 4/,0+<< /0: 0/59,/6 9<5+" 5?+0 5?+

6/55+, < </: 5 ?/+ le!iti"ate ex#e&tations 5?/5 /0 7+ ;,5+5+:.#1

$F/, /0: E95/76+ T,+/5*+05% */0:/5+< 5?+ C ONTRACTING P ARTIES 5 ;,:+ 5 05+,0/50/6

0+<5*+05< 5,+/5*+05 5?/5 :+< 05 /44+5 5?+ 7/< +>;+5/50< 5?/5 +,+ 5/+0 05 /905 7= 5?+

4,+@0 0+<5, 5 */+ 5?+ 0+<5*+05.#2 T?+ 4,+@0 0+<5, < +0556+: 5 / 6+@5*/5+ +>;+5/50 4

0<<5+0= /0: 4,++:* 4,* /*7@95= 0 ;6= /0: ,96+< ,+6/50@ 5 5?+ 0+<5*+05.#3

*6 A,5 31'2(" VCLT.

*7C0S Gas Trans"ission Co v1 Ar!entine Re#ubli&, ICSID C/<+ N. ARB1&" 'M/= 12" 2)(K Re#ubli& of

E&uador v1 O&&idental Ex#loration and Produ&tion Co1" 'Su#ra, 05+ 3)(.

*8 A;;+0:>" F/5<" P,+/*76+".#.

*( C0S Gas Trans"ission Co v1 Ar!entine Re#ubli&, 'Su#ra, 05+ 3(.. 2#.

4) Aurix Cor#oration v1 Ar!entine Re#ubli& 5urisdi&tionF "'Su#ra, 05+ 33(K C0S Gas Trans"ission Co v1

Ar!entine Re#ubli&, 1" 'Su#ra, 05+ 3(.K Re#ubli& of E&uador v1 O&&idental Ex#loration and Produ&tion Co1" 'Su#ra,

05+ 3)(.41 P. C,/@" ADMINISTRATIVE LAW" '23(" )5? E:." S++5 M/>+66" L0:0(" C?/;5+, 13.

42 Te&ni&as 0edioa"bientales Te&"ed SA v1 United 0exi&an States A%ardF, '2#( #3 ILM 133 'ICSID 'AF(" 23"

G,@+,/ N/0 P" F+,0/0:+8 R8/< B+,0/6 V+,+/(K C0E Ce& Re#ubli& ( Te NeterlandsF v Ce& Re#ubli&

Partial A%ard,F ICSID R+; 121"23& 'UNCITRAL" 21" !9?0 C." S?+7+6 H/0:6(" Re#ubli& of E&uador v1

O&&idental Ex#loration and Produ&tion Co1" 'Su#ra, 05+ 3)(.

4* Re#ubli& of E&uador v1 O&&idental Ex#loration and Produ&tion Co1" 'Su#ra, 05+ 3)(KTe&ni&as 0edioa"bientales

Te&"ed SA v1 United 0exi&an States A%ardF,I:." C0E Ce& Re#ubli& ( Te NeterlandsF v Ce& Re#ubli&

Partial A%ard,F I:.




1*


#.2. A RGUENDO " THE I NTERNATIONAL MINIMUM STANDARDS OF $FAIR AND EQUITABLE

TREATMENT% I NCLUDES PROTECTION OF LEGITIMATE EXPECTATIONS

A<<9*0@ 795 05 /:*550@ 5?/5 5?+ <;+ 4 5?+ 76@/50 90:+, A,56+ 2 4 5?+ BIT < ,+<5,5+: 5 5?+

05+,0/50/6 *0*9* <5/0:/,:<" 5 < <97*55+: 5?/5 <9? *0*9* <5/0:/,:< 96: 069:+ /0

76@/50 5 ;,5+5 6+@5*/5+ +>;+5/50<. T?+ :5,0+ 4 @:-4/5? < 4 <90: <5/0:0@ 0

05+,0/50/6 6/. I5 < / ;/,5 4 9<5*/,= 05+,0/50/6 6/ /0: ?/< 7++0 0,;,/5+: 05 / 09*7+, 4

05+,0/50/6 5,+/5+<. W?6+ :+/60@ 5? 5?+ 5; 4 6+@5*/5+ +>;+5/50<" /,75,/6 5,790/6< ?/+

6/5+: 5< ,@0 5?0 5?+ :5,0+ 4 @:-4/5?.## F, 0<5/0+" 5 /< ?+6: 0 T+0/<

0edioa"bientales Te&"ed SA v1 United 0exi&an States “te !ood fait #rin&i#le establised b'

international la% re>uires te &ontra&tin! #arties to #rovide international invest"ents treat"ent tat does

not affe&t te basi& ex#e&tations tat %ere ta=en into a&&ount b' te forei!n investor to "a=e te

invest"ent #)1 S*6/,6= 0 5?+ Nu&lear Tests /<+" 5?+ 6+@5*/5+ +>;+5/50 ,+/5+: 7= 5?+ P,+<:+05 4

F,/0+ /0: 5?+ 76@/50< 4 F,/0+ /,<0@ 5?+,+4,* +,+ 6/5+: 5?0 5?+ ;,0;6+ 4 @:-4/5?.#

I0 6@?5 4 5?+ /7+" 5 < <97*55+: 5?/5 ++0 /<<9*0@ 5?/5 5?+ 76@/50 90:+, A,56+ 2 4 5?+ BIT

+>5+0:< 06= 5 5?+ 05+,0/50/6 *0*9* <5/0:/,:< 4 4/, /0: +95/76+ 5,+/5*+05" 5?+ ;,5+50 4

6+@5*/5+ +>;+5/50< /0 7+ 6/5+: 5?0 <9? *0*9* <5/0:/,:<.

#.3 THE R ESPONDENT , THROUGH ITS CHANGE IN TAX POLICY HAS BREACHED THE OBLIGATION

OF FAIR AND EQUITABLE TREATMENT

I5 ?/< 7++0 <944+056= +<5/76<?+: 7= 5?+ 4,+@0@ <97*<<0< 5?/5 ;,+<+,/50 4 <5/765= 4

0+<5*+05 4,/*+, /0: ;,5+50 4 6+@5*/5+ +>;+5/50< /,+ */0:/5+: 7= 5?+ 76@/50 4 4/,

/0: +95/76+ 5,+/5*+05. A65+,/50 4 5/> <5,959,+" *;<0@ /0 /::50/6 5/> 79,:+0 4 0 5?+

C $AI0ANT /65+,+: 5?+ 6+@/6 /0: 79<0+<< 6*/5+ 0 ?? 5?+ C $AI0ANT :+:+: 5 0+<5 /0: ?/< /44+5+:

;,+9:/66= 5?+ CLAIMANT%S 6+@5*/5+ +>;+5/50< ,+@/,:0@ 5?+ +0* /765= /0: +>;+5+:

,+59,0< 4,* 5< 0+<5*+05< 0 5?+ R ESPONDENT <5/5+. H+0+" 5?+,+ ?/< 7++0 / 6/50 4 5?+ 76@/50

4 4/, /0: +95/76+ 5,+/5*+05 0 5+,*< 4 <97<5/05/6 /65+,/50< 0 5?+ 0+<5*+05 4,/*+, /0: /

4/69,+ 5 ;,5+5 6+@5*/5+ +>;+5/50<.

44 Te&ni&as 0edioa"bientales Te&"ed SA v1 United 0exi&an States A%ardF, 'Su#ra, 05+ #2(K AD4 Grou#

In&or#orated v1 United States of A"eri&a A%ardF, ICSID R+; ##.

4# Te&ni&as 0edioa"bientales Te&"ed SA v1 United 0exi&an States A%ardF," 'Su#ra, 05+ #2(.

46 Nu&lear Tests Ne% ealand v1 4ran&eF &ase, ICJ R+;,5<" 1)" ;@. 2&&.




14


. The Tax / $easures of the Respondent mount to0n1ustied %xpropriation 0nder International 3aw andis 'iolative of rticle " of the IT

I5 < <97*55+: 5?/5 5?+ 5/> *+/<9,+ *;<+: 7= 5?+ R ESPONDENT /*905< 5 /0 /5 4 0:,+5

+>;,;,/50 /< 5?+ </*+ ?/< +44+5< +9/6+05 5 5?/5 4 +>;,;,/50 /0: 0@ 5 5< ;+,*/0+05

0/59,+. I5 < /6< <97*55+: 5?/5 5?+ ;9,;<+ /0: 05+>5 4 5?+ *+/<9,+ :+< 05 0+@/5+ 5 7+0@ /0 /5 4

+>;,;,/50 /0: 5?/5 5?+ </*+ < 05 9<54+: /< /0 +>+,<+ 4 5?+ ;6+ ;+,< 4 5?+ S5/5+. F9,5?+," 5

< <97*55+: 5?/5 5?+ +>;,;,/50 < 66+@/6 0@ 5 5?+ 00- ;/=*+05 4 *;+0</50.

).1. TAX MEASURES OF THE R ESPONDENT AMOUNT TO I NDIRECT EXPROPRIATION U NDER

I NTERNATIONAL LAW

).1.1. Ex#ro#riation as Understood in International $a% in&ludes Indire&t Ex#ro#riation

E>;,;,/50 0 05+,0/50/6 6/ 069:+< 75? :,+5 /0: 0:,+5 +>;,;,/50. I0:,+5 +>;,;,/50 <

</: 5 ?/+ 9,,+: ?+0 5?+,+ < /0 05+,4+,+0+ 7= / <5/5+ 0 5?+ 9<+ 4 ;,;+,5= , 5? 5?+ +0=*+05

4 5?+ 7+0+45< 5?95 5?+ <+89,+ 4 5?+ ;,;+,5= /0: 5?95 /44+50@ 5?+ 6+@/6 556+ 5 5?+ ;,;+,5= #.

E>;,;,/50 069:+< +,+: , 0:+05/6 05+,4+,+0+ 5? 5?+ 9<+ 4 ;,;+,5= ?? ?/< 5?+ +44+5 4

:+;,0@ 5?+ 0+, 0 ?6+ , 0 <@004/05 ;/,5 4 5?+ '( ,+/<0/76= 5- 7+ +>;+5+: +0*

7+0+45 4 ;,;+,5= ++0 4 05 0++<</,6= 5 5?+ 79< 7+0+45 4 5?+ ?<5 S5/5+.#& T?+ 0+;5 4

0:,+5 +>;,;,/50 ?/< 7++0 /,:+: 05+,0/50/6 ,+@050 7= 5?+ /= 4 5 7+0@ :<9<<+: 0 /

09*7+, 4 05+,0/50/6 5+>5< 069:0@ B6/5+,/6 I0+<5*+05 T,+/5+<" M:+6 BIT< /0: A,75,/6 A/,:<. #

W?+5?+, , 05 / ,+@96/5,= *+/<9,+ /*905< 5 0:,+5 +>;,;,/50 < 5 7+ 9:@+: 0 5+,*< 4 ( 5?+

47 O,@/08/50 4, E0* D++6;*+05 /0: C-;+,/50 ereinafter O1E1C1D12, Indire&t Ex#ro#riation and

te Ri!t to Re!ulate in International Invest"ent $a%, W,0@ P/;+,< 0 I05+,0/50/6 I0+<5*+05" N. 2##"

S+;5+*7+, 2#" ;;. 3-#K )aste 0ana!e"ent In& v1 United 0exi&an States A%ardF, '2#( #3 ILM

'NAFTAICSID 'AF(" 2#" C,/4,: P" C6+55 M/@/660 G*+8K 0iddle East Ce"ent Si##in! andlin! Co1 SA v1 Arab Re#ubli& of E!'#t A%ardF, ICSID C/<+A,7 'ICSID" 22" B<5+@+6 P" B+,0/,:0

W/66/+(.

48 0etal&lad Cor#oration v1 United 0exi&an States A%ardF, ) ICSID R+; 2"'NAFTAICSID 'AF(" 2"

L/95+,;/?5 P." C6+55" S9+,<(.

4( O.E.C.D" Te 0ultilateral A!ree"ent on Invest"ent Ne!otiatin! Text //6/76+ /5

?55;.+:.,@:/5/+:##1&)12.;:4 '<5+: 0 &.2.2&(K A,5 111'1(" N,5? A*+,/0 F,++ T,/:+A@,++*+05 '/:;5+: D++*7+, 1" 12" +05+,+: 05 4,+ 1 J/09/,= 1#( CTS 1# N. 2 ?+,+0/45+,

N.A.F.T.A.K A,5 13'1(" E0+,@= C?/,5+, T,+/5=" '<@0+: 1 D++*7+, 1#" +05+,+: 05 4,+ 3 D++*7+, 1("

2& UNTS 1 ?+,+0/45+, E.C.TK A,5 VIK T?+ A<</50 4 S95? A</0 N/50< A@,++*+05 4, T?+ P,*50

/0: P,5+50 4 I0+<5*+05< '<@0+: 1) D++*7+, 1&( '1&&( 2 ILM 12" 13K N'&o"b S'ner!eti&s

Te&nolo!' oldin! A v Re#1 of $atvia A%ardF, SCC C/<+ N. 11&21'SCC 23" H/9@ C" S?958+ /0:

G+,0/0:5( #.3.1




1#


:+@,++ 4 05+,4+,+0+ 5? 5?+ ;,;+,5= ,@?5" ( 5?+ ?/,/5+, 4 @+,0*+05/6 *+/<9,+<" .+. 5?+ ;9,;<+

/0: 5?+ 05+>5 4 5?+ @+,0*+05/6 *+/<9,+" /0: ( 5?+ 05+,4+,+0+ 4 5?+ *+/<9,+ 5? ,+/<0/76+ /0:

0+<5*+05-7/+: +>;+5/50<.)

).1.2. Te 0easure in 6uestion as an Effe&t on te Investor E>uivalent to Ex#ro#riationS++,5= 4 5?+ +0* *;/5 /9<+: 7= / @+,0*+05 /50 < 5 7+ 5,+/5+: /< /0 *;,5/05 +6+*+05

0 :+5+,*00@ ?+5?+, 5 ,<+< 5 5?+ 6++6 4 /0 +>;,;,/50 ,+9,0@ *;+0</50.)1 Te intent of te

!overn"ent is less i"#ortant tan te effe&ts of te "easures on te o%ner, and te for" of te "easures

of &ontrol or interferen&e is less i"#ortant tan te realit' of teir i"#a&t .)2 A ,+@96/5,= *+/<9,+

/*905< 5 +>;,;,/50 4 5 si!nifi&antl' interferes 5? 5?+ 0+<5,%< ;,;+,5= ,@?5<.)3

I0 5?+ 0<5/05 */55+," 5?+ +0* *;/5 4 5?+ @+,0*+05/6 /50 0 5?+ 0+<5, < <9? 5?/5 4/69,+

5 @+5 / 4/9,/76+ :+<0 0 5?< ,+@/,: 0 / <;/0 4 +@?5 *05?< 66 ,+<965 0 $40/0/6 ,90% 4 5?+

C $AI0ANT 1@Q

H+0+ 5 < <97*55+: 5?/5 5?+ *;9@0+: *+/<9,+ ?/< *;<+: 0 5?+ C $AI0ANT <9?

?/,:<?; 5?/5 0 ,:0/,= 9,<+ 4 ++05< 0509+: /55= < 05 /76+. T?< ?/< substantiall' te sa"e

i"#a&t on effe&tive &ontrol over use and o#eration as if te #ro#erties %ere te"selves &on&eded /0:

?+0+ 5?+ *;9@0+: *+/<9,+ /*905< 5 0:,+5 +>;,;,/50.))

#)

O.E.C.D , Indire&t Ex#ro#riation and te Ri!t to Re!ulate in International Invest"ent $a%, W,0@ P/;+,< 0I05+,0/50/6 I0+<5*+05" N. 2##" S+;5+*7+, 2#.

#1 and'side v1 United /in!do" , 2# E9,. C5. H.R. '<+,.A( /5 2 '1(K Poiss v1 Austria, 11 E9,. C5.H.R. '<+,.( &#"

1& '1&(K 0atos e Silva, $da v1 Portu!al , A;;. N. 1)&" 2# E9,. C5. H.R. ,+;. )3" -1 '1(.

#2 Ti##etts, Abbett, 0& Cart', Stratton v1 TA00S-A44A Consultin! En!ineers of Iran ,'1&#( -UNSCTR 21" 22)K

Ebrai"i Sain SaineF v Isla"i& Re#ubli& of Iran,'1#( 3-I,/0-UNSCTR 1"1" Pilli#s Petroleu" Co Iran

v1 Isla"i& Re#ubli& of Iran, te National Iranian Oil Co1, '1&( 21 I,/0-UNSCTR "11)" Antoine iloune and

0arine Drive Co"#lex $td1 v1 Gana Invest"ent Centre and Govern"ent of Gana A%ardsF, ) ILR 1&3 '13(

'1& 1" S?+7+6 P" W/66/+ M0,+ L+@?(.

#* 4eld"an v United 0exi&an States A%ardF , ARB'AF(1" A/,: 4 1 D++*7+, 22" 3" ).

#4 F/5<" 12.

## Revere Co##er rass In&1 v1 Overseas Private Invest"ent Cor#oration, ) I05+,0/50/6 L+@/6 M/5+,/6<

2)&JPo#e Talbot In& v1 Govern"ent of Canada Interi" A%ardF, ICSID R+; " &K Ga"i Invest"ent In& v1

Govern"ent of Ne% 0exi&an States A%ardF,'UNCITRALNAFTA" 2#" R+<*/0 P" M9, P/96<<0(K LY F,5+,

SL D,=*+," “ Indire&t Ex#ro#riation in te $a% of International Invest"ent. I /no% it %en I see it, or Caveat

Investor " '2#( 1 ICSID R+-FILJ 23";;.2-3)K A,5 13'/("H/,/,: D,/45 C0+050 0 5?+ I05+,0/50/6

R+<;0<765= 4 S5/5+< 4, I09,+< 5 A6+0<.




16


).1.3. Te 0easure in 6uestion A"ounts to Ex#ro#riation in (ie% of its Per"anent Nature

T?+ :9,/50 4 5?+ ,+@96/50 , 05+,4+,+0+ ?/< 7++0 /+;5+: /< /0 *;,5/05 ,5+,0 0 :+5+,*00@

?+5?+, 5 9/64+< 5 7+ /0 /5 4 +>;,;,/50. ) T,790/6< ?/+ 0<:+,+: 5?+ 4/5 5?/5 5?+ +0*

*;/5 4 5?+ *+/<9,+ < 05 *+,+6= +;?+*+,/6 795 4 / 6/<50@ , ,,++,<76+ 0/59,+ /< / <944+05

0:/5, 4 5?+ *+/<9,+ 7+0@ +>;,;,/5,=.) I0 5?+ 0<5/05 */55+," 5?+,+ < 0 *+050 4 /0= 05+050

0 5?+ ;/,5 4 5?+ R ESPONDENT 5 ,+<5,+ 5?+ C $AI0ANT 5 5< +0* /765=. M,++," 5?+ 4/5 5?/5

5?+ ,+<965 4 05 7+0@ /76+ 5 <+9,+ / 4/9,/76+ //,: 0 / <;/0 4 +@?5 *05?< < 4,+<++0 5 7+

$40/0/6 ,90% <?< 5?+ ,,++,<76+ 0/59,+ 4 5?+ *;/5. H+0+ 5 < <97*55+: 5?/5 0 + 4 5?+

4,+@0@" 5?+ *;9@0+: *+/<9,+" 0 5+,*< 4 5?+ :9,/50 4 5< *;/5" /*905< 5 0:,+5

+>;,;,/50.

).2. THE IMPUGNED EXPROPRIATION BY THE R ESPONDENT IS ILLEGAL IN I NTERNATIONAL LAW

P/=*+05 4 /:+9/5+ *;+0</50 inter alia < 0++<</,= /,: 6+@/65= 5 /0 +>;,;,/50 0

05+,0/50/6 6/. T?9@? 5?+,+ /,+ :44+,+0+< 0 5?+ 9/059* 4 *;+0</50 5?+ 05+,0/50/6

**905= 0+,@+< 0 5?+ +><5+0+ 4 5?+ 76@/50 5 *;+0</5+ 4, +>;,;,/50. )& E+0 / ;976

;9,;<+ , 5?+ ;+,*<<765=0++<<5= 4 +>;,;,/50 90:+, :*+<5 , 05+,0/50/6 6/ 96: 05

/7<6+ 5?+ S5/5+ 4 5< 76@/50 5 *;+0</5+.)

I0 5?+ 0<5/05 */55+," 5?+ +>;,;,/50 ?/< 7++0 /,,+: 95 5?95 /0= *;+0</50 ?/5<++,. H+0+"

5 < <97*55+: 5?/5 5?+ +>;,;,/50 < 66+@/6 0 05+,0/50/6 6/ /0: 6/5+ 4 A,5. # 4 5?+ BIT.

).3. THE IMPUGNED MEASURE IS NOT JUSTIFIED AS AN EXERCISE OF THE POLICE POWERS OF THE STATE

I5 < <97*55+: 5?/5 5?9@? $;6+ ;+,<% 0<5595+ /0 +>+;50 5 5?+ ,96+ 4 *;+0</50"

++,= /5 4 ,+@96/50 , 5/>/50 /005 7+ 7,9@?5 5?0 5< /*75. $P6+ ;+,<% ,+4+,< 5

#6 Ti##etts, Abbett, 0& Cart', Stratton v1 TA00S-A44A Consultin! En!ineers of Iran ,' 'Su#ra, 05+ )2(Kel#s-

Dod!e Cor#1 Overseas Pvt1 Invest"ent Cor#oration v1 Iran" '1&( 1 I,/0-UNSCTR 121K Te&ni&as

0edioa"bientales Te&"ed SA v1 United 0exi&an States A%ardF, 'Su#ra, 05+ #2(..

#7 Id1

#8 Indire&t Ex#ro#riation and te Ri!t to Re!ulate in International Invest"ent $a%, S9;,/" 05+ )(.#( C*;// :+6 D+</,,66 :+ S/05/ E6+0/ S.A. . R+;976 4 C<5/ R/" ICSID C/<+ N. ARB1"'F+7,9/,=

1" 2(.

6) Co"#aMa del Desarrollo de Santa Elena S1A1 v1 Re#ubli& of Costa Ri&a, ICSID C/<+ N. ARB1"'F+7,9/,= 1"

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17


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/;;,;,/50 4 ;,;+,5=.1 T?+ :<5050 7+5++0 ,+@96/5,= *+/<9,+< /0: +>+,<+ 4 ;6+

;+,< ?/< 7++0 <5,+<<+: 9;0 7= / 09*7+, 4 +*0+05 <?6/,<.2 I05+,0/50/6 6/ ,+@08+<

06= 5 7,/: /5+@,+< 4 ;6+ ;+, ,+@96/50 5?/5 *@?5 9<54= 00-*;+0</50 ?+,+

5?+,+ < / :+;,/50 '( ;976 ,:+, /0: *,/65=K /0: '( ;,5+50 4 ?9*/0 ?+/65? /0: 5?+

+0,0*+05.3 I0 5?+ 0<5/05 */55+," 5/> *+/<9,+ *;<+: 7= 5?+ R ESPONDENT , 5?9@? ,+@96/5,=

0 0/59,+" :+< 05 4/66 5?0 +5?+, 4 5?+ </: /5+@,+< /0: ?+0+ :+< 05 9/64= 5 7+

;,5+5+: /< /0 +>+,<+ 4 ;6+ ;+,<.

).#. A RGUENDO " THE STATE IS PRECLUDED FROM THE EXERCISE OF ITS POLICE POWERS TO THE

EXTENT IT HAS U NDERTA!EN OBLIGATIONS TO THE CONTRARY

I5 < <97*55+: 5?/5 5?+ /765= 4 5?+ <5/5+ 5 9<54= 00-*;+0</50 0 5?+ 5 /7+

*+050+: @,90:< 66 7+ /44+5+: 7= 5?+ +>5+05 5 ?? 5?+ <5/5+ ?/: */:+ 6+@/66= 70:0@

**5*+05< 5 5?+ 05,/,=.# W?+0 / S5/5+ 0:9+< 5?+ 0+<5, 5 7+6++ 5?/5 / 6+@/6

76@/50 < 05 70:0@ 9;0 5?+ 6/55+, /0: 5?+ 6/55+, ?/< /5+: ,+6=0@ 0 5?+ </: 7+6+4" 5?+

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;+,<.)

I0 5?+ 0<5/05 */55+," 5?+ ,96/, 'CBT1)#3)( <<9+: 7= 5?+ C+05,/6 B/,: 4 T/>/50 ?/:

+>+*;5+: 5?+ C $AI0ANT 4,* 5?+ 76@/50 90:+, 5?+ T/>/50 4 I0+<5*+05< A5" 21.

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2)&.

62 R. H@@0<" “Te Ta=in! of Pro#ert' b' te State. Re&ent Develo#"ents in International $a% "'1&2( 1 R+.

:+< C9,< 2)K D.F. V/@5<" “Coer&ion and 4orei!n Invest"ent Rearran!e"ents8 '1&( 2 A.J.I.L. 1K G1C1Cristie, 9)at Constitutes a Ta=in! of Pro#ert' under International $a%8 '12( 33 B.Y.I.L. 3K B.H. W+<50"

99Constru&tive Ta=in!s8 under International $a%. A 0odest 4ora' into te Proble" of Cree#in! Ex#ro#riation8

'1)( 1 V/. J. I056 L. 13.

6* A0:,+ N+C*7+" “Te oundaries of Re!ulator' Ex#ro#riation in International $a%" '2)( 21 ICSID

R++" 'S9;,/ 05+ (.

# B690+ . G?/0/ I0+<5*+05 C+05,+ , ) ILR" ;;. 1&3" 2-1.

6# I:.

66 F/5<" . .




18


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**5*+05 /0: 5?+ ,+6/0+ ;6/+: 7= 5?+ C $AI0ANT 0 5?+ </*+" 5 < <97*55+: 5?/5 ++0

/<<9*0@ 5?/5 5?+ */55+, 4/66< 5?0 ;6+ ;+,< 4 5?+ S5/5+" 5?+ R ESPONDENT < ;,+69:+:

4,* +>+,<0@ <9? ;+,< 0 5?< ,+@/,:.

67 A;;+0:>" F/5<.




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1( T?/5 5?+ T,790/6 ?/< 9,<:50 +, /66 */55+,< ,/<+: 7= 5?+ C $AI0ANT K

2( T?/5 5?+ C $AI0ANT < / 0/50/6 4 R590:/ 4, 5?+ ;9,;<+ 4 5?< ;,++:0@

3( T?/5 5?+ C $AI0ANT < +0556+: 5 ,+6= 0 A,5. 3 4 5?+ BIT 5 +<5/76<? 5?+ 9,<:50 4 5?+

T,790/6

#( T?/5 5?+ *;9@0+: 5/> *+/<9,+ 6/5+< 5?+ 76@/50< 4 5?+ R ESPONDENT 90:+, A,5. 2

/0: A,5. # 4 5?+ BIT

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CONSEL FOR CLAI-ANT

memo final.doc

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