issue #13, week 17. 22 April 2008
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

Ecuador reaches agreement with Occidental Petroleum in tax dispute

April 16, http://www.oilweek.com/news.asp?ID=15422

Ecuador has settled a dispute with the U.S. oil company Occidental and will return US$100 million in taxes, the energy minister said Wednesday.

But another dispute with foreign investors appeared to be brewing, as members of the assembly writing a new constitution said it will probably cancel most of the country´s mining concessions.

In 2006, the government cancelled the contract of California-based Occidental Petroleum Corp., accusing the company of violating its terms. But industry observers believed a major reason for the cancellation was the company´s demand for a return of tax payments.

Occidental at the time said it was due a US$171 million refund.

...

Discussions on commercial arbitration attract wide participation at DIAC event

April 17, http://www.ameinfo.com/153690.html

H.E. Engineer Hamad Mubarak Buamim, Director General of Dubai Chamber of Commerce & Industry (DCCI), inaugurated the roundtable discussion on developing and implementing commercial arbitration in the United Arab Emirates.

...

Decision Reached in Magnetek Appeal of Patent Arbitration Award

April 17, http://www.forbes.com/businesswire/feeds/businesswire/2008/04/17/businesswire20080417005680r1.html

Magnetek, Inc. (NYSE:MAG) today announced that the arbitration award originally entered on April 29, 2005, in the amount of $23,352,440, on Ole K. Nilssen's patent infringement claim against Magnetek has been confirmed in a judgment entered as of April 16, 2008 in the United States District Court for the Northern District of Illinois. That same judgment denied Magnetek's petition to vacate the award. The net amount due and unpaid on the award is $21,977,440. Magnetek intends to appeal the judgment.

...

Oil Trader Mercuria To File Arbitration Suit vs Poland

April 17, http://news.morningstar.com/newsnet/ViewNews.aspx?article=/DJ/200804171208DOWJONESDJONLINE000978_univ.xml

Mercuria Energy Group, an international oil trader, said Thursday that it has initiated international arbitration procedure against Poland.

Mercuria said it will sue Poland for violating the Energy Charter Treaty, which protects investments and trade in the energy sector.

On April 3, 2008, a government agency responsible for managing the country's strategic reserves re-imposed a 462 million zloty ($214.5 million) fine on J&S Energy, a Polish unit of Mercuria, for failing to gather required amounts of mandatory fuel reserves.

...

Irkutsk Court of Arbitration postponed hearings on Baikal pulp-paper mill till May 20

April 17, http://itar-tass.com/eng/level2.html?NewsID=12593422&PageNum=0

The Irkutsk Court of Arbitration has postponed hearings on the damage the Baikal Pulp and Paper Mill has caused to the world's largest, unique body of fresh water till May 20, an official of the environmental watchdog Rosprirodnadzor told Itar-Tass.

The mill asked the court to have a chance to study the results of tests of Lake Baikal's water carried out by the weather watching service Rosgidromet.

...

International tribunal begins to arbitrate RDC's dispute with Guatemalan government

April 17, http://www.progressiverailroading.com/news/article.asp?id=16266

The International Centre for the Settlement of Investment Disputes (ICSID) recently began binding arbitration proceedings concerning Railroad Development Corp.'s (RDC) claims against the Guatemalan government. A three-member tribunal — the first ever under the Dominican Republic-Central America-United States Free Trade Agreement (CAFTA) — will rule on the claims.

RDC sought international arbitration in March 2007 in response to the government's August 2006 declaration of "lesivo" against its rail subsidiary Ferrovías Guatemala (FVG). The government declared the lease of the national railway rolling stock — a key component of a 1998 privatization agreement — was against the interests of the state.

...

Hyundai Heavy-IPIC Feud Deepens Over Oilbank

April 18, http://www.koreatimes.co.kr/www/news/nation/2008/04/123_22768.html

Conflicts are intensifying between South Korea's Hyundai Heavy Industries and International Petroleum Investment Co. (IPIC) of the United Arab Emirates, over the right to buy a local refiner.

Hyundai Heavy, the second-largest shareholder, retorted to an IPIC statement on April 8 and was confident it will win a legal battle on the case, which is currently under review by the International Court of Arbitration in Singapore, an umbrella of the International Court of Commerce.

In the statement, the state-run IPIC claimed the Korean company was derelict in dealing with its offers for Hyundai Oilbank, and it will demand Hyundai Heavy and its associates sell all their 30 percent stake to the majority holder.

``We reviewed the statement but feel it is not appropriate in many parts,'' an official of Hyundai Heavy said on condition of anonymity. ``The case is in international court now and we are confident we will win the case and own Hyundai Oilbank in the end.''

...

Mittal takes on Nigerian President after $450m deal turns sour

April 20, http://www.independent.co.uk/news/business/news/mittal-takes-on-nigerian-president-after-450m-deal-turns-sour-812041.html

Global Steel Holdings, a Mittal family concern, has filed a lawsuit at the International Court of Arbitration over the Nigerian government's decision to renege on its sale of its largest iron and steel plant.

Global, which is run by Pramod Mittal, the younger brother of London-based steel billionaire Lakshmi, has invested $450m (£225m) in the Ajaokuta Steel Company and National Iron Ore Mining Company over the past four years, making a $192m down-payment on stakes in them.

But Global and Nigerian officials have come to blows over the government's decision at the beginning of the month to confiscate the concessions Global had been awarded and pull out of the sale of the stakes.

Global is fighting the decisions and has now lodged a lawsuit at the arbitration court of the International Chamber of Commerce, the world's leading international arbitration body, to have the concessions reinstated and the sale completed.

...

Dubai company $ 1bln lawsuit raises trade concerns

April 17, http://www.guardian.co.uk/feedarticle?id=7469844

A $1 billion lawsuit between a firm owned by the ruler of Dubai and a U.S. company could hinder free trade talks between the United States and the United Arab Emirates, according to a U.S. Congressional document. The dispute between Tecom Investments, which is owned by Sheikh Mohammed bin Rashid al-Maktoum, and U.S. property developer Capital Partners revolves around 38 acres of land Capital Partners attempted to buy from Tecom in July 2005.

Capital Partners had initially agreed to develop a $1 billion mixed-use project on land almost opposite one of Dubai's man-made palm islands, in a deal hailed as one of the first foreign investments in Dubai.

But in August, the U.S. private equity firm filed a $1 billion claim against Tecom for misrepresentation and breach of contract, Jonathan Wride, the company's managing director said in an email statement to Reuters at the time. Tecom confirmed that the lawsuit, which is being handled by the Dubai International Arbitration Centre, was ongoing, but gave no more details. "The lawsuit between Tecom Investments and Capital is still under litigation," Tecom said in a statement sent to Reuters.

...

Prime Minister Nguyen Tan Dung urges thoroughness for Can Tho refinery

April 21, http://vietnamnews.vnagency.com.vn/showarticle.php?num=05ECO210408

Prime Minister Nguyen Tan Dung has urged Can Tho City's People's Committee to weigh its licensing of the Can Tho Oil Refinery project, an investment of Vien Dong Corporation and China National Overseas Engineering Corporation.

The sufficiency of crude oil sources for refining upon the project's completion and the financial capacity of investors should be thoroughly studied, Dung said in his official dispatch published on the Government website on Saturday.

Granting investment licenses to a project should follow Enterprise Law and Investment Law procedures, he said.

...

Move Over, Shaghai, Dubai & Singapore, Lagos Arbitration Hub Cometh!

April 14, http://www.thisdayonline.com/nview.php?id=108653

A critical step in the development of Lagos State as a hub for commercial and legal activity in the African continent has been taken by the adoption by the State government of a far reaching plan to reform the regime for arbitration and alternative dispute resolution within the territory of state. YEMI CANDIDE-JOHNSON, SAN explains

...

Singapore: Information on New Arbitration Initiatives

Ministry of Law, CAA 9th April 2008

Singapore is recognised as a leading centre for international arbitration work, with a reputation for reliability, efficiency and neutrality. Our laws are arbitration-friendly and the judiciary understands and is highly supportive of arbitration. Singapore is also well-connected by air and is extremely business friendly. All this has helped to establish Singapore as a key international arbitration location.

Building on these strengths, the Ministry of Law has embarked on various initiatives to grow the arbitration industry in Singapore, with support from other government agencies and industry partners. These initiatives include the ongoing development of an integrated dispute resolution complex, a tax incentive for law practices carrying out international arbitration work, easier immigration procedures for persons involved in arbitration and mediation, and the establishment of international arbitral institutions in Singapore, such as the American Arbitration Association and the Permanent Court of Arbitration.

There are now two new developments that will add to the attractiveness of Singapore as a venue for international arbitration:

  1. A tax incentive for law practices carrying out international arbitration work with hearings in Singapore, and;
  2. A work pass exemption for those entering Singapore for arbitration and mediation services.

Tax Incentive for International Arbitration Work in Singapore

Singapore is already a preferred choice as a venue of arbitration in the region. This is of no surprise ­ many law practices, arbitrators and even arbitration clients are well aware of our sterling reputation in international arbitration circles. However, there is still much room for Singapore to capture a larger regional share of this industry, as evidenced by the strongly increasing volume of international arbitration cases being heard here each year.

This tax incentive allows law practices to capitalize on this positive trend. They can now enjoy a tax exemption on a portion of their arbitration income from international arbitration cases with hearings in Singapore, for up to five years. Holding arbitrations in Singapore regularly would translate into significant tax savings for the law practice.

This tax incentive serves to encourage law practices to promote Singapore as an arbitration hearing venue. It will also be a prime consideration for those deciding where to locate their regional arbitration practices to cater for the burgeoning Asian market. If a law practice already carries out substantial arbitration work in Singapore, but is not based locally nor has partners who are tax-resident here, establishing an outfit in Singapore will instantly generate tax savings.

For more information on the incentive, please contact:

Ms Eunice Tan at , 6332 8859, or

Mr Seck Yee Kwang at , 6832 6546

Work Pass Exemption for Arbitration and Mediation Services

It is now more convenient for non-residents to enter Singapore to carry out arbitration and mediation work. As of 1st February 2008, non-residents no longer need to apply for a work pass to carry out arbitration and mediation services in Singapore.

Previously, it was a requirement for persons entering Singapore to carry out arbitration and mediation work to apply for a work pass. This would have applied to persons such as arbitrators and legal counsel. This was an administrative burden to those involved in alternative dispute resolution hearings in Singapore.

A work pass is now no longer necessary. Instead, arbitration and mediation work can be performed whilst holding a Social Visit Pass, subject to a maximum of 60 days, as long as the case is not religious, racial or political in nature. The Social Visit Pass does not require any application in advance, as it will be granted on entry at our immigration checkpoints. Once in Singapore, all that is required is for the person to make a simple e-notification using an online form available at www.enotifywpe.mom.gov.sg. This process only requires the filling in of personal particulars, and should take no more than 5 minutes.

This exemption is applicable to the following persons when they enter Singapore to perform services directly related to arbitration or mediation:

  1. a. Arbitrators / Mediators
  2. b. Legal Counsel
  3. c. Other professional service providers involved in the proceedings, for example, translators and transcribers

For more information, please visit www.mom.gov.sg.

Draft Model Norwegian Bilateral Investment Treaty (December 19, 2007)

http://www.asil.org/ilib/2008/04/ilib080421.htm#t1

Norway issued a draft model bilateral investment treaty (BIT) for public comment December 19, 2007. The draft model BIT is notable in a number of respects. Its preambular language underscores Norway's desire to promote transparency in economic cooperation between the parties as well as to protect health, safety, the environment, and international labor rights. It emphasizes the importance of corporate social responsibility and reaffirms the parties' commitment to democracy, the rule of law, human rights and fundamental freedoms in accordance with their duties under the United Nations Charter and the Universal Declaration of Human Rights. It notes the determination of the parties to prevent and fight corruption, including bribery in international trade and investment.

Articles 19, 21, and 31 address transparency. Article 19 requires the tribunal to make publicly available all documents either submitted to it or that it issues. Parties to the dispute may designate certain information as confidential if it is not generally known or accessible to the public; or, if it were it to be released it would cause prejudice to an "essential interest" of the parties or an individual or entity. Article 19 also requires the tribunal to hold hearings open to the public; but Article 21 permits it to close hearings wholly or in part. Article 21 gives the tribunal the authority to allow and consider submissions by amici if it determines that such submissions are both factually and legally directly relevant. Article 31 requires the parties to publish or otherwise make available their laws, regulations, and international agreements that may affect the agreement. Article 32 requires the parties to encourage investors to manage their investments in compliance with OECD guidelines for corporate social responsibility for multinational enterprises and take part in the United Nations Global Compact.

PODCASTS

Negotiating a Binding Dispute Clause with a Greek Company

This week, Mike discusses litigation, mediation, and arbitration in Greece with attorney Pericles Stroubos.

This episode is available for download here www.cpradr.org/audio1.asp

WEBLOGS

US: Licensor's successor is not bound by arbitration clause in license agreement

April 21, http://ipspotlight.com/2008/04/21/licensors-successor-is-not-bound-by-arbitration-clause-in-license-agreement/

Last week's Federal Circuit decision in DataTreasury Corp. v Wells Fargo & Company highlights the interplay between federal and state laws in IP license agreements. In the case, a patent license agreement contained an arbitration clause in which the parties agreed that all disputes would be subject to arbitration. The patent holder/licensor then assigned the patent to DataTreasury. When DataTreasury brought suit against Wells Fargo (parent of the licensee) Wells Fargo argued that DataTreasury was subject to the license agreement's arbitration clause.

The court disagreed. Noting that the agreement was governed by Minnesota law, and that Minnesota law does not (in most situations) impose an arbitration clause on a party who has not expressly agreed to it, the court held that DataTreasury was not subject to the agreement's arbitration clause.

...

EVENTS

Lauterpacht Centre for International Law 25th Anniversary Celebrations - 11 & 12 July 2008

http://www.lcil.cam.ac.uk/news/article.php?section=25&article=673

The Function of Law in the International Community

The Lauterpacht Centre celebrates its 25th anniversary on Friday 11th and Saturday 12th of July 2008. The celebrations, entitled the Function of Law in the International Community in recognition of the 75th anniversary of Sir Hersch Lauterpacht's seminal work, will also mark the 80th birthday of the Centre's founder, Sir Elihu Lauterpacht. Events will feature speakers and participants of great renown within the field of international law and include conference sessions at the Faculty of Law, an anniversary dinner at Trinity College and a barbeque and drinks reception at the Lauterpacht Centre.

Attendance is by invitation only and there are a limited number of places available.

Second Annual Investment Treaty Arbitration Conference: A Debate and Discussion - 25 April

http://www.jurisconferences.com/arbitration.php?id=13

With the number of international investment arbitration cases filed each year showing no sign of decreasing, it is time for a dialogue between some of the brightest new stars in the field and some of its most seasoned practitioners. Ten up-and-comers have prepared papers on five of the most controversial and important issues in international investment law today. On April 25th our young authors will pair up to face a panel of arbitrators and arbitration specialists to discuss their findings. The discussion and debate that will follow is sure to be of tremendous value to the international business lawyer and litigation specialist alike.

Specialised Arbitration & Advocacy Skills in International Oil & Gas Disputes

Seminar Presenters: Professor T.W. Walde; Tim Martin, Esq; Arif Hyder Ali, Esq; William H. Knull III, Esq and others.
September 08 - 12. Hilton Hotel, Dundee
More information is available at the CEPMLP website

Foreign Direct Investment International Moot Competition - Investor-State Arbitration: Perspectives on Legitimacy and Practice

Foreign Direct Investment International Moot Competition - Investor-State Arbitration: Perspectives on Legitimacy and Practice
The FDI Moot promotes an understanding of international investment laws and of arbitration as an effective mechanism for the adjudicating international investment disputes. The event attracts not only the student participants but also lawyers from the around the world, who act as judges as part of a program that allows them also to discuss in a collegial environment developments affecting the field. The FDI Moot involves a hypothetical case in connection with an investment by a private foreign investor. Each year’s hypothetical is prepared by the competition’s Advisory Board, composed of distinguished academics and practitioners in the fields of international arbitration, investor-State arbitration and international investment regulation.
October 31 - November 2. Boston, Massachusetts.
More information is available at www.fdimoot.org.

Short overview of upcoming events

The above information is reproduced from the International Arbitration Planner by kind permission of Lovells (www.lovells.com and www.lovells.com/arbitration). More details on these and many other events can be found at www.arbitrationevents.com

BOOKS

New book on arbitration in Latin America

March 2008, http://www.iccwbo.org/iccbjhai/index.html

Alternative methods of resolving disputes in Latin America are the subject of a newly published book resulting from a study day organized by the Société de législation comparée and the ICC International Court of Arbitration.

Independence of Arbitrators - ICC International Court of Arbitration Bulletin

http://www.iccbooks.com/Product/ProductInfo.aspx?id=499&cid=84

2007 Special Supplement, ICC Publication No. 690, 2008 Edition

Also available as part of the ICC International Court of Arbitration Bulletin subscription. Click here for details.

Independence is an essential requirement of anyone called upon to judge the opposing claims of parties in dispute. In arbitration, this requirement has particular significance and raises special issues, due to the very nature of a procedure in which party autonomy has pride of place.

This collection of articles illustrates and elucidates many of the practical issues flowing from this requirement, while at the same time offering philosophical and comparative perspectives on the subject.

Published as part of the ICC International Court of Arbitration Bulletin, Independence of Arbitrators covers:

This book is a rich resource combining practical and well-documented case commentaries with informed and stimulating reflection by distinguished practitioners and specialists in the field.

Table of Contents

Early English Arbitration Law: Managing Disputes Before The Common Law

http://www.earlyenglisharbitration.co.uk/

ISBN13: 9780954405618
ISBN: 0954405617
Derek Roebuck
Published: April 2008
Publisher: Holo Books
Country of Publication: UK
Binding: Hardback
£40.00 GBP

The first history of how disputes of all kinds were managed in England before the Common Law.

It starts in prehistoric times, with archaeology, anthropology and genetics providing evidence of regular assemblies dealing with disputes. From Roman times onwards, documents allow a detailed, though partial, picture to be drawn. Not only does the literature describe how mediation and arbitration worked in practice, but a fragment survives of an award dated 14 November 114AD.

The sources grow more plentiful in Anglo-Saxon times. We can read a Wiltshire arbitrator's full report in his own words of an arbitration in Alfred's time and learn new tricks from an award made in Worcestershire a thousand years ago. Long after the Norman Conquest, the normal method of resolving disputes was still by public arbitration in traditional assemblies according to customary law. And a compromise could be mediated in the middle of a trial by battle, with one side's champion concealing that he had lost his sight.

This interdisciplinary study uses all the surviving original sources with new translations, drawing on the work not only of historians but archaeologists, anthropologists, linguists, geneticists and other natural scientists. It shows how natural and widespread mediation and arbitration have been in England since before history began. There is plenty of evidence of routine mediations and arbitrations in all manner of disputes: landownership, succession, ecclesiastical squabbles. A successful mediation after a prince had been killed led to peace between Northumbria and Mercia. There was no lack of techniques fashioned to fit, including expert determination and a sophisticated form of dispute management successfully avoiding a difference becoming a dispute.

To understand how disputes are managed, it is necessary to know what languages were used and how. An appendix deals with the many unsettled questions of the languages of the period, British (including Welsh), Latin, Anglo-Saxon and Anglo-Norman (French).