issue #08, week 20. 16 May 2007
Prepared by TDM and Aloysius Gng (CEPMLP/Dundee)

TDM News Digest

provides a condensed overview of recent events of interest to the international arbitration community.

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Recent issues:

NEWS

CIArb publishes Guideline on the Interviewing of Prospective Arbitrators

http://www.arbitrators.org/Institute/PR_CIA027.asp

The issue of the interviewing of prospective arbitrators has been a contentious one for many years and has remained very much a grey, even controversial, area. Consequently, the CIArb is pleased to announce the publication of its Guideline on the Interviewing of Prospective Arbitrators, which has been prepared following wide international consultation.

The Guideline is part of a set of such Guidelines covering arbitrators' dealing with multi-party cases, jurisdictional issues, challenges in court, interest, costs, security for costs, setting of fees etc. The Guidelines were originally prepared to assist practitioners in the application of the UK's Arbitration Act 1996 but have now been up-dated and internationalised to cover a representative selection of jurisdictions, both common and civil law and including Model Law jurisdictions. The emphasis is very practical (ie, "how to") and identifies key areas where the arbitrators' approach may differ from jurisdiction to jurisdiction, in particular highlighting 'warning flags'.

The CIArb Committee which has prepared the Guideline is internationally-constituted and widely experienced and is now being assisted by a Working Group comprising young lawyers resident in or qualified in Argentina, Dubai, France, Germany, India, Lebanon, the PRC, Russia and Switzerland.

…

Herbert Smith hands power back to the partners

May 14, http://www.thelawyer.com/cgi-bin/item.cgi?id=125776&d=11&h=24&f=23

Herbert Smith is attempting to reverse the trend of corporatisation of law firms, with its management being decentralised and handed back to the partners. Senior partner David Gold wants to shift the firm's managerial emphasis, with the onus for driving the firm forward moving away from him and onto every partner in the firm.

…

Gold said the reasoning behind the creation of a stand-alone arbitration group was to build a small, focused unit with more responsibility for its own business.

Guatemala: Attorney general disputes RDC charge of indirect expropriation

May 14, http://www.bnamericas.com/story.jsp?sector=6&noticia=392594&idioma=I

Pittsburgh-based Railroad Development Corporation's (RDC) suit against the Guatemalan government for the supposed indirect expropriation of the assets of its local rail subsidiary Ferrovías de Guatemala is baseless, Guatemalan attorney general Mario Gordillo told BNamericas.

RDC claims that the government's decision in August 2006 to deem the company's 50-year operation and maintenance usufruct agreement, awarded to the company in 1997, as "damaging" amounted to an indirect expropriation of the company's property, BNamericas reported previously.

As a result, RDC is seeking damages of US$65mn, of which US$15mn corresponds to investments already made, and US$50mn in projected returns from its operation, previous reports indicated.

Upon RDC's filing of a notice of intent in March, the company and Guatemala's government had three months to come to an agreement, after which time the case would go to the International Center for Settlement of Investment Disputes (ICSID), according to previous reports.

…

UAE must produce a better arbitration law: Al Tamimi

May 14, http://www.khaleejtimes.com/DisplayArticleNew.asp?xfile=data/business/2007/May/business_May429.xml&section=
business&col=

DUBAI — A legal office yesterday urged the UAE to draw up what it described as a "world-class arbitration law" saying that the draft of an existing one does not provide the business operations security that foreign investors are looking for.

"There was a strong consensus to the effect that the UAE ought to consult widely in an effort to produce a world-class arbitration law surpassing all others in the region and beyond," said Al Tamimi & Company Advocates and Legal Consultants.

In a statement, Al Tamimi said a draft of the arbitration law was taken up in the recent Middle East New York Convention Roundtable, a discussion it hosted and brought together regional and international legal experts to assess how the arbitration awards, made possible by the 1958 New York Convention, are being implemented in the Middle East.

Under the Convention, which the UAE agreed to apply in November 2006, commercial arbitration awards — decisions emanating from the amicable settlement of conflicts between two or more business firms in a member economy without the high cost of legal proceedings — made in the UAE can now be directly enforced in 142 member-countries. In return, foreign awards can also be enforced through the UAE courts.

…

Italian Bondholders' Arbitration Against Argentina Advances

May 10, www.tfargentina.it

Giovanna A. Beccara and others v. Argentine Republic (Case No. ARB/07/5)

"The appointment of the ICSID tribunal is another essential step in moving the arbitration forward as planned," says Stock.

The arbitration brought by Italian bondholders against Argentina is moving forward under the auspices of the International Centre for Settlement of Investment Disputes (ICSID) in Washington, DC. A tribunal of three arbitrators will consider the Request for Arbitration filed by almost 195,000 Italian natural persons and juridical entities who invested almost US$ 4.4 billion in Argentine sovereign bonds.

Since ICSID registered the case on February 7, 2007, the Italian bondholders have designated Albert Jan van den Berg of the Netherlands as their party-appointed arbitrator. A partner in the Brussels firm of Hanotiau & van den Berg and Professor of Law - Arbitration - at Erasmus University of Rotterdam, Professor van den Berg received the inaugural award as the world's leading commercial arbitrator by The International Who's Who of Business Lawyers in 2006. Argentina has designated Georges Abi Saab of Egypt, honorary professor of the Graduate Institute of International Studies in Geneva and the Cairo University Faculty of Law, as its party-appointed arbitrator. The parties are now negotiating regarding the appointment of the third arbitrator, who will act as president of the Tribunal.

Nicola Stock, the President of Task Force Argentina (TFA), states, "The appointment of the ICSID tribunal is proceeding apace and the arbitration is moving forward as planned." ICSID has designated the arbitration as Giovanna a Beccara and others v. Argentina Republic, ICSID Case No. ARB/07/5. After the appointment of the arbitral tribunal, the procedural schedule will be established and the case will move forward to address issues of jurisdiction and the substance of the dispute culminating in an arbitration award.

In addition to the arbitration, TFA, the working group established to protect the interests of Italian bondholders, has also taken steps to preserve the contract rights of participating bondholders from possible expiry of prescription periods that may arise under the laws of relevant national jurisdictions. As one of those steps, all participating Italian bondholders holding bonds governed by New York or English law filed an action in federal court in New York raising contract claims under applicable domestic law. The court stayed that action pending the outcome of the ICSID arbitration. As TFA has emphasized in the past, any participating bondholders who revoke their participation mandates put the protection of their rights at risk.

The Italian bondholders are represented by White & Case LLP in Washington, D.C., Grimaldi e Associati in Rome and Perez Alati, Grondona, Benites, Arntsen & Martinez de Hoz, Jr. in Buenos Aires.

Participating Italian bondholders may obtain further informationby contacting their own bank or sending a request for information to info@tfargentina.it, or consulting the website www.tfargentina.it.

USA: Bush in accord with Democrats on trade deals

May 10, Steven R. Weisman, International Herald Tribune, http://www.iht.com/bin/print.php?id=5662941

The Bush administration reached agreement … to attach environmental and worker protections in several pending trade accords, clearing the way for early passage of some pacts and improving prospects for others. The unusual agreement, which came after weeks of negotiations, would guarantee workers the right to organize, ban child labor and prohibit forced labor in trading-partner countries. It would also require trading partners to enforce environmental laws already on their books and comply with several international environmental agreements.

…

In addition to the labor and environmental provisions, the accord would make it easier for generic drugs to be sold in foreign countries; preserve the right of the United States to bar foreign companies from running American ports; and ensure that foreign investors will not have more rights than American investors domestically. There are also promises to step up training of workers who lose their jobs because of imports.

The full text of the agreement can be found here:

http://waysandmeans.house.gov/Media/pdf/110/05%2014%2007/05%2014%2007.pdf [pdf]

Pakistan: Talks on Pak-Czech investment treaty under way

http://www.thenews.com.pk/daily_detail.asp?id=55090

Prime Minister of Czech Republic Mirek Topolanek has assured Pakistan that being the European Union member, Prague would play its role in strengthening Islamabad's relations and striking a Free Trade Agreement with the bloc.

The visiting premier said that negotiations on Bilateral Investment Treaty (BIT) and agreement for avoidance of double taxation between the two were also underway. The talks on this particular issue would soon end on a positive note.

…

Czech Republic: For 10 years, Slovakia has ignored an agreement with the Czech Republic to protect investments

The Prague Post, May 9, http://www.praguepost.com/articles/2007/05/09/torched-accord.php

A recently spawned legal battle between Slovakia and Madeta, the Czech Republic's largest dairy processor, has led to a discovery that, for the past 10 years, Slovakia has not honored a trade agreement signed between the countries during the Velvet Divorce.

Slovakia's failure to recognize this bilateral investment-protection agreement eliminates one common route for Czech businesses seeking to resolve major grievances with the Slovak state, forcing them to enter drawn-out court processes within or outside the European Union.

The Czech and Slovak republics originally signed the agreement in 1992 as part of a series of preparations for the federation's split the following January. But, when Madeta's lawyers began researching the agreement as a possible means of resolving their client's grievances, they found that Slovakia has not recognized the agreement since 1997. "We found that the legal status of this agreement isn't completely straightforward," said Richard Wagner, one of the lawyers representing Madeta.

…

Indonesia: Foreign investment options shrink

http://www.thejakartapost.com/detailheadlines.asp?fileid=20070510.B09&irec=8

The government reaffirmed its commitment Wednesday to protecting local business by expanding the list of business fields closed to foreign investment….

Bolivia plans to renegotiate investment protection pacts with 24 countries

May 9, http://www.forbes.com/business/feeds/afx/2007/05/09/afx3701096.html

The Bolivian government plans to renegotiate investment protection treaties it has signed with 24 countries including the United States, Brazil and France, charge d'affaires for trade Pablo Solon told foreign journalists last night. Solon said changes would be made step by step and that it will explain its plans to each individual government concerned. At the same time, the Bolivian government wants to pull out of the World Bank's ICSID system (International Centre for Settlement of Investment Disputes).

…

ICSID - pending case: Bureau Veritas, Inspection, Valuation, Assestment and Control, BIVAC B.V. v. Republic of Paraguay (Case No. ARB/07/9)

Subject Matter: Service agreement
Date Registered: April 11, 2007
Status of Proceeding: Pending (Tribunal not yet constituted)

ICSID - pending case: Meerapfel Söhne AG v. Central African Republic (Case No. ARB/07/10)

Subject Matter: Tobacco industry
Date Registered: April 25, 2007
Status of Proceeding: Pending (Tribunal not yet constituted)

AAA Announces International Mediation Institute

May 14, http://www.adr.org/sp.asp?id=32377

At the 2007 annual meeting, held recently in New York, William K. Slate II, American Arbitration Association president and CEO, announced the formation of a new public service, nonprofit foundation that could very well have a major impact on the practice of mediation around the world. The new organization is called the International Mediation Institute (IMI).

Established through the combined efforts of three dispute resolution institutions--the AAA/ICDR, the Netherlands Mediation Institute (NMI), and the Singapore International Arbitration Centre (SIAC)/Singapore Mediation Centre (SMC)--the IMI's goal is to develop international competency standards for mediators, certify mediators under those standards, and serve as a resource for information about the IMI-certified mediators and the mediation process in general. Ultimately understanding and acceptance of the process worldwide should be increased.

…

EVENTS

Central/DIS Summer Academy on International Commercial Arbitration and Business Negotiation and Mediation (two separate programmes) - September 2 - 6

Interactive training programme focussing on the promotion of know-how and practical skills in arbitration and other forms of alternative dispute resolution

From September 2 to September 6, 2007 the Center for Transnational Law (CENTRAL) in cooperation with the German Institution of Arbitration (DIS) organizes the fifth Cologne Summer Academy on International Commercial Arbitration at the University of Cologne.

The Academy is addressed to advanced students and young practitioners. The working language is English.

Unlike other events, the Academy is based on a unique, highly practical and highly interactive teaching concept. You get the rare opportunity to improve your skills and knowledge in both the law and practice of international commercial arbitration under the guidance of highly experienced professionals. You will get actively involved in all stages of a real inter-national arbitration. You will have the chance to plead or examine witnesses with instant feedback from the workshop leaders. You can watch your workshop leaders perform as arbitrators or counsel in the same case on video.

More information at http://www.central.uni-koeln.de/content/e68/e4714/e4715/e7993/index_ger.html

ICC: International arbitration conference on the Arab world

15 May 2007, http://www.iccwbo.org/iccbddga/index.html

The conference will take place in Tunis from 17-18 May 2007.

Growth in the economies of the Arab world has been accompanied by the need for a greater understanding of arbitration. Traditionally, arbitration has been seen as a last resort once all communication between parties has broken down.

An international conference on arbitration in the Arab world, jointly organized by the International Chamber of Commerce and two local organizations, Tunis Center for Conciliation and Arbitration and Tunisian Confederation of Industry, Trade and Handicrafts, aims to increase the understanding of the arbitration process and how it can assist business in the Arab world.

MOVES / JOBS

AAA Board of Directors Elects New Leaders

May 11, http://www.adr.org/sp.asp?id=32367

Two new officers of the American Arbitration Association's board of directors, and new members of its Executive Committee, were elected on April 30 at the AAA's 2007 annual meeting in New York. Leading the board of directors as chairperson for the coming term is John M. Townsend, partner at Hughes Hubbard and Reed and chair of its Arbitration and ADR Group. First elected to the AAA board in 1995, he has been chair of the Executive Committee since 2004.

ICC: Ms Cheng-Yee Khong new regional representative for Asia

http://www.iccwbo.org/court/arbitration/id13146/index.html

The ICC International Court of Arbitration has appointed Ms Cheng-Yee Khong as its new regional representative for Asia. Ms Khong, who took up her position on 1 May 2007, is based in Kuala Lumpur. She will bring the expertise and experience of the Court and ICC's other dispute resolution services within easier reach of lawyers and businesses in the Asia and Pacific region.

Ms Khong is a qualified lawyer and a former member of the Secretariat of the Court. She trained in England, where she graduated in law and then obtained a master's degree in international business and management. She has been admitted as a solicitor of the Supreme Court of England and Wales and as an advocate and solicitor in Malaysia, and has worked with international law firms in Paris and Kuala Lumpur. Ms Khong is fluent in English, French, Cantonese and Bahasa Malaysia.

…

Salans hires George Burn for arbitration launch

http://www.thelawyer.com/cgi-bin/item.cgi?id=125751&d=11&h=24&f=23

Salans has hired George Burn to spearhead its London international arbitration practice. He will be based in London but will work closely with Salans' Paris international arbitration team.

Addleshaw Goddard appoints Simon Kamstra as Head of International Arbitration

http://www.addleshawgoddard.com/view.asp?content_id=2455&parent_id=968

Addleshaw Goddard Contentious Partner, Simon Kamstra, has been appointed as the firm's Head of International Arbitration. The firm has also strengthened its international arbitration team by recruiting a senior associate, Jon Tweedale, from Allen & Overy. The firm's arbitration group consists of more than 40 lawyers based in London, Leeds and Manchester which in each of the last three years has been instructed on claims exceeding $1.2billion and regularly advises on arbitration disputes involving claims of $50m or more.

Jan Schäfer joins Allen & Overy

http://www.thelawyer.com/cgi-bin/item.cgi?id=125732&d=11&h=24&f=23

Allen & Overy has hired Jan Schäfer as an international arbitration senior associate in Germany. He joins from Shearman & Sterling, where he was also a senior associate. He has specialized in international arbitration from 1997 and has been acting as counsel and arbitrator in international and German arbitration proceeding since 2001, notably under the Rules of the ICC and DIS. He has published widely in the field and is a regular speaker at arbitration conferences. He is coordinator of DIS 40 and co-chairs the German Discussion Forum on Investment Law and Arbitration. He was educated in Germany, England, Holland and Singapore.

Jean de Hauteclocque joins Howrey in Paris

http://www.howrey.com/news/index.cfm?fuseaction=news&newsid=3451

Howrey LLP has announced that Jean de Hauteclocque, one of France's leading arbitration and dispute resolution specialists, has joined the firm's Paris office as of today. He joins from his own firm, Hauteclocque-Larroumet-Tessler and was previously at 0Lovells and at Freshfields (1984-2000) where he headed the Litigation Department . In making the announcement, Robert F. Ruyak, Chairman and CEO of Howrey, said, "Jean de Hauteclocque will expand our arbitration practice to Paris, one of the most important venues for arbitration in the world. He is well known and respected there and we look forward to continuing to develop our arbitration team in France. Working with Melanie Willems and her team in our London office, and our US arbitration practice, Howrey will continue to provide skilled international arbitration representation for our clients worldwide. We welcome Jean to Howrey."

Dr. Andrés Rigo Sureda designated to ICSID Arbitrators and Conciliators panel until 2013

Spain has renewed the designation of Dr. Andrés RIGO SUREDA (Past Acting Vice President and General Counsel World Bank) to the panels of Arbitrators and Conciliators of ICSID for another 6 years.