issue #24, week 37. 09 September 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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NEWS

New German Foreign Investment Law Faces Challenges

September 8, http://www.law.com/jsp/article.jsp?id=1202424321685

German business doesn't want it, the European Union is highly suspicious of it and the City of London hopes for a lucrative windfall. But Germany's government has pressed ahead with it anyway.

The object under question is a draft law, which German Chancellor Angela Merkel's Cabinet passed in late August, that would allow the Economy Ministry to veto foreign investments in German companies that threaten public order and security. The law, which needs parliamentary approval, would establish a committee, loosely modeled on Washington's Committee on Foreign Investment in the United States. Its task would be to scrutinize purchases of stakes of 25 percent or more in German firms by buyers from outside the EU and its four partners in the European Free Trade Association, Norway, Switzerland, Iceland and Liechtenstein.

...

Word Bank urges Yemen to amend investment law

September 5, http://www.sabanews.net/en/news163404.htm

The World Bank urged Yemen to apply institutional separation between bodies organizing foreign investments and those propagating for them and to apply stable and concentrated process reforms for improving investment climate.

A final report prepared by WB's Consultative Office for Foreign Investments Services has called for applying national strategy propagating for foreign investments sponsored by General Investment Authority (GIA), London based al-Hayah Newspaper reported.

...

US pushing Pakistan to accept draft of investment treaty

September 03, http://www.thenews.com.pk/daily_detail.asp?id=133529

The US administration is pushing Pakistan to accept newly placed draft of Bilateral Investment Treaty (BIT), which has been signed only by few backward African countries, The News has learnt.

If the conditions attached by the USA for inking BIT are the best in the world, why many developed and non-developed countries are reluctant to buy it, official sources questioned who are dealing with negotiation process in this regard.

...

West Tankers case (Case C-185/07)

http://tinyurl.com/5ky76q

OPINION OF ADVOCATE GENERAL KOKOTT - delivered on 4 September 2008 1(1) Case C-185/07

Allianz SpA (formerly Riunione Adriatica Di Sicurta SpA) and Others v West Tankers Inc.

(Reference for a preliminary ruling from the House of Lords (United Kingdom))

(Regulation (EC) No 44/2001- Scope - Arbitration - Order restraining a person from commencing or continuing proceedings before the national courts of another Member State instead of before an arbitral body (anti-suit injunction))

...

Anti-suit Injunctions in Support of Arbitration Agreements Are Contrary to EU law, According to the Opinion of Advocate General Kokott

The question whether anti-suit injunctions to protect an arbitration agreement are compatible with European Union law is currently pending before the European Court of Justice ("the ECJ") in Case C-185/07 Allianz (formerly Riunione Adriatica di Sicurta Spa) and Others v West Tankers Inc. In her Opinion delivered today Advocate General Kokott proposes that the Court should answer that question in the negative with potentially wide ranging implications for arbitration across Member States including, in particular, in London, Paris and Stockholm.

...

EU anti-suit ruling a blow to London arbitration (Subscription required)

September 5, http://www.lloydslist.com/ll/news/viewArticle.htm?articleId=20017568152

THE European Union Advocate-General's opinion against the use of anti-suit injunctions to halt legal proceedings in other member states has been hailed as bad news for London arbitration.

The Advocate-General's opinion is not binding on the European Court of Justice, but is generally followed in the majority of cases. It was made in ...

Subscription required

Pacific Millennium Investment Corporation and Richard Tan Found Liable of Corporate Improprieties

September 3, http://www.marketwatch.com/news/story/pacific-millennium-investment-corporation-richard/story.aspx?guid=%7B460D12B6-5AE8-4020-BC6E-FD354FC5EF72%7D&dist=hppr

Arbitrator Hon. Howard B. Weiner Rules in favor of Energy Systems International, LLC

The invalid issuance of stock purported to divest ESI of its equal rights and interests in ESIL and to deny ESI's voting rights and powers as co-equal shareholder and co-equal controlling director of the corporation. The arbitration will now enter phase two of the proceedings to determine the damages and remedies associated with PMIC and Tan's conduct.

In addition to the second phase of the arbitration, contempt proceedings are pending in the San Diego County Superior Court against PMIC and Tan, respecting those parties' alleged violations of a preliminary injunction entered on August 30, 2007. The next hearing in the contempt proceedings is scheduled for October 31, 2008.

...

Sterlite may go for arbitration for BALCO residual stake sale

September 7, http://www.steelguru.com/news/index/2008/09/07/NjE5MDY%3D/Sterlite_may_go_for_arbitration_for_BALCO_residual_stake_sale.html

BS reported that India's largest copper producer Sterlite Industries may enter into arbitration for the purchase of the residual 49% government stake in Bharat Aluminum Company.

The report cited a Sterlite Industries official as per saying that this comes after both parties failed to arrive at an agreement on an appropriate valuation of the stake.

Czech Republic appeals arbitration result in Diag Human dispute

September 4, http://www.praguemonitor.com/en/415/czech_national_news/27604/

The Czech Republic has appealed the result of the arbitration with Diag Human, according to which the state is to pay some nine billion crowns to the company in compensation for harming its deals with blood plasma, the public Czech Television (CT) reported Wednesday.

The state demands that new arbitrators re-assess the decision.

"We want new arbitrators to assess the files and comment on the damage level," Health Ministry spokesman Tomas Cikrt told CT.

...

India set to emerge as hub for international arbitration

September 4, http://economictimes.indiatimes.com/News/Economy/Policy/India_set_to_emerge_as_hub_for_international_arbitration_/rssarticleshow/3445638.cms

The Union Cabinet on Thursday paved the way for the country's emergence as a prestigious hub for out-of-court settlement of international commercial disputes between various governments and non-government parties.

It decided to set up in New Delhi a regional bench of the Hague-based Permanent Court of Arbitration (PCA). A similar facility in the region is available only in Singapore.

In its meeting, chaired by Prime Minister Manmohan Singh, the Cabinet also decided to ratify India's agreement, known as "Host Country Agreement" with PCA. The agreement was signed earlier to establish a regional facility of PCA in New Delhi.

...

Tata Comm to pay over $19 m to Reliance Globalcom: ICC

September 02, http://www.financialexpress.com/news/Tata-Comm-to-pay-over--19-m-to-Reliance-Globalcom--ICC/356201/

The International Chamber of Commerce (ICC), the global arbitration tribunal on Monday asked Tata Communications to pay over $19 million to Reliance Globalcom, a subsidiary of Anil Ambani-led Reliance Communication Ltd (Rcomm), as the 'loss profit damages claim for sale of capacity'.

"The tribunal has directed Tata Communications to pay Reliance a sum of approximately $19 million plus interest from May 2006 as damages against the $385 million sum claimed by Reliance," Tata Communications said in a filing with the Bombay Stock Exchange (BSE).

...

New Arbitration Law of the Dubai International Financial Centre (DIFC)

September 1, http://www.difc.ae/press_centre/archive/2008/536.html

The new Law will enable the recently established DIFC-LCIA Arbitration Centre to provide neutral, efficient and reliable dispute resolution services to companies throughout the world. The enactment of the Law will help DIFC position itself as a world-class centre for arbitration.

The Arbitration Law covers all stages of the arbitral process, from the arbitration agreement to the recognition and enforcement of arbitral awards. Universally applicable and compatible with both civil and common law systems, the new Law offers the international business community, international lawyers and arbitrators a comprehensive and modern set of rules and procedures to enable effective settlement of arbitration cases.

His Excellency Dr. Omar Bin Sulaiman, Governor of DIFC said: "With the introduction of the Arbitration Law, DIFC now offers a legislative platform for comprehensive dispute resolution. After a positive period of consultation, we are confident that the new Arbitration Law, in conjunction with the newly formed DIFC-LCIA Arbitration Centre, will ensure that local, regional and global companies have an expeditious, cost effective alternative to expensive, laborious dispute settlements done traditionally through the courts."

"By offering arbitration to companies throughout the world, the DIFC is reaffirming its commitment to creating a legal and regulatory environment of the highest standard that surpasses the requirements of leading financial institutions," he added.

The enactment of the Law is the culmination of an extensive process in which it was drafted by an industry focus group, led by the DIFC Authority, consisting of companies operating in DIFC. This was followed by a period of consultation during which the public was invited to comment on the Law.

Venezuela: Mexico's Cemex not interested in minority stake after cement nationalization

September 01, http://www.canadianbusiness.com/markets/market_news/article.jsp?content=D92U7V4G0

Venezuela says Mexico's Cemex does not appear to be interested in maintaining a minority share in cement plants nationalized by President Hugo Chavez. Venezuela has offered Cemex SAB a minority share of its three Venezuelan cement plants, 30 smaller concrete plants and shipping terminals during negotiations on compensation for the Mexican company's assets.

But Venezuelan Vice President Ramon Carrizalez said Monday that he does not believe Cemex is interested in holding on to a majority stake.

...

Ternium asks Venezuela government to resume talks on Sidor

August 30, http://www.canadianbusiness.com/markets/headline_news/article.jsp?content=b083002A

Ternium SA said Friday it has asked the Venezuelan government to restart stalled talks on a compensation deal for the nationalization of the country's largest steelmaker, Sidor. Ternium, a subsidiary of Argentine-Italian conglomerate Techint, said it asked Venezuelan officials to resume negotiations after Venezuelan President Hugo Chavez ended talks earlier this week, saying he saw no possibility for an agreement.

Ternium had owned 60 per cent of Sidor until it was nationalized in May, and the company said in a statement that it has a right to "adequate compensation."

...

Techint likely to sue Venezuela over Sidor takeover

August 29, http://steelguru.com/news/index/2008/08/29/NjA2NzY%3D/Techint_likely_to_sue_Venezuela_over_Sidor_takeover.html

EFE reported that Argentinean Italian conglomerate Techint is pondering the possibility of filing an action against Venezuela, after President Mr Hugo Chávez Wednesday suspended the talks on the terms under which the holding is to sell to the Venezuelan state a majority stake in the country's largest steelmaker Sidor.

The report said that "Techint officials said they were likely to bring an action before the International Centre for Settlement of Investment Disputes, the arbitration tribunal of the World Bank, after Techint was surprised" by the arbitrary and unilateral decision taken by Mr Chávez."

...

US: High Court Rejects Arbitration Agreements That Expand Judicial Review

http://www.abanet.org/litigation/litigationnews/2008/august/article_arbitration.html

The U.S. Supreme Court has added greater finality to arbitration awards, which should prompt attorneys to revise the standard arbitration provisions they include in their clients' contracts.

...

WEBLOGS

Has California Answered Hall Street's Invitation Already?

September 7, http://www.indisputably.org/?p=167

The U.S. Supreme Court's Hall Street opinion in March 2008 made clear that the Court believes that the FAA does not provide a basis for parties to expand contractually the scope of judicial reviews of arbitral awards. But the Court specifically left open the possibility that state statutory or common law might provide a basis for such expanded review.

Now, less than six months later, it appears that the California Supreme Court has taken up that invitation (if that's what the Supreme Court was offering), in a case called Cable Connection, Inc. v. DIRECTTV, Inc., ___ Cal. Rptr. 3d ___ (August 25, 2008).

...

China Arbitration. When, Why, Why Not, And Where.

August 31, http://www.chinalawblog.com/2008/08/china_arbitration_to_be_or_not.html

Co-blogger Steve Dickinson recently wrote a column for the China Economic Review on the plusses and minuses of arbitration provisions in contracts with Chinese companies. The article is entitled, "Overseas arbitration and enforcing contracts in China," and, not surprisingly, it says that decisions on whether to arbitrate should be made on a case by case basis.

...

The AG Opinion in West Tankers

http://www.conflictoflaws.net/2008/cases/the-ag-opinion-in-west-tankers/

PODCASTS

IDN: Jenny Beer, author of the seminal, cross-discipline guide, The Mediator's Handbook, which she coauthored in 1982

http://www.cpradr.org/tabid/45/articleType/ArticleView/articleId/388/Default.aspx

She tells IDN host Mike McIlwrath: We learned that disputes are important political property. Knowing the secrets of the institution, knowing where the dead bodies lie in your community, and having the authority to intervene in those and to say that you were the one that fixed them, is very important politically both within organizations and in a community. And therefore you don't want to hand it off.

EVENTS

Cross-cultural issues in International Arbitration, 15 September 2008

http://www.iccwbo.org/icccdhje/index.html

The third annual ICC New York Conference, which will take place on 15 September 2008, will focus on how bridging the cultural gab in international arbitration.

MOVES / JOBS

Debevoise & Plimpton hires Sophie Lamb

September 1, http://www.debevoise.com/newseventspubs/news/detail.aspx?id=f1363223-4ac7-4902-8244-5e078f8a026b

New York-based Debevoise & Plimpton has snared Bird & Bird partner Sophie Lamb to boost its European litigation practice. Lamb, who specialises in international commercial arbitration, joins as international counsel. Debevoise is also transferring international counsel Gaëtan Verhoosel from its Paris office to London.

LAWFIRMS

King & Spalding's Houston Office: Building Bench Strength

http://www.metrocorpcounsel.com/current.php?artType=view&artMonth=September&artYear=2008&EntryNo=8739

The Editor interviews Robert E. Meadows , Managing Partner of the Houston office of King & Spalding LLP.

...

We have also brought in John Bowman and Jennifer Price, who have outstanding, internationally recognized reputations in international arbitration. Their presence will only serve to enhance what is already known as a very significant international arbitration practice under the leadership of Doak Bishop.

...

Hunton & Williams LLP Signs Memorandum of Understanding With Mkono & Co. Advocates, East Africa's Largest Law Firm

September 1, http://biz.yahoo.com/prnews/080901/3730221en_public.html?.v=1

Hunton & Williams LLP announces it has signed a Memorandum of Understanding with the largest law firm in East Africa, the Dar es Salaam-based Mkono & Co. Advocates. The two firms, which have for more than a decade collaborated as co-counsel on energy-related matters in Tanzania, will now work together to further develop their law practices involving energy matters and other infrastructure projects in East Africa; investments in Africa by investors, sovereign states, and multilateral finance institutions; investment-related disputes; and the flow of commerce between Africa and Asia and between Africa and the United States.

...

BOOKS

International Arbitration Checklists 2nd ed

http://www.jurispub.com/355/toc/international-arbitration-checklists

Edited by: Lawrence W. Newman, Grant Hanessian
Publisher: Juris Publishing
Binding: Hardback
ISBN13: 9781933833217
Not yet published, due August 2008
Price: £80.00 Pre-Order / View

Contribution authors: Alexis Martinez, Andrew J.L. Aglionby, Arthur W. Rovine, Bruce H. Jackson, Chuan Thye Tan, David A. Fraser, David Zaslowsky, Eugenio Hernandez, George A. Bermann, Grant Hanessian, Haig Oghigian, J. Brian Casey, Jean-Piere Harb, Jeremy B. Winter, Jeremy Winter, Joaquim P. Muniz, Jonas Benedictsson, Juergen Mark, Lawrence W. Newman, Leigh W. Duthie, Michael L. Morkin, Richard M. Franklin, Robert B. Davidson, Stefan Bessman, Vladimir Khvalei, Werner Mueller, Ygnacio Reyes-Retana.

Common Law of International Adjudication

Publisher: Oxford University Press
Author: Chester Brown
Binding: Paperback
ISBN13: 9780199563906
Not yet published, due February 2009
Price: £29.99

Recent years have seen a proliferation of international courts and tribunals, which has given rise to several new issues affecting the administration of international justice. This book makes a signification contribution to understanding the impact of this proliferation by addressing one important question: namely, whether international courts and tribunals are increasingly adopting common approaches to issues of procedure and remedies. This book's central argument is that there is an increasing commonality in the practice of international courts to the application of rules concerning these issues, and that this represents the emergence of a common law of international adjudication ...

Constructive Interventions: Paradigms, Process and Practice of International Mediation

http://www.kluwerlaw.com/Catalogue/titleinfo.htm?ProdID=9041126856&name=Constructive-Interventions%3AParadigms%2C-Process-and-Practice-of-International-Mediation

L Kirchhoff
ISBN13: 9789041126856
Publisher: Kluwer Law International
Binding: Hardback
Price: USD price: $172.00

In the contemporary discipline of conflict resolution, adjudication and alternative dispute resolution (ADR) are often seen as antagonistic trends. This important book contends that, on the contrary, it is the bringing together of these trends that holds the most promise for an effective system of international justice. With great insight and passion, built firmly on a vast knowledge of the field, Lars Kirchhoff exposes the contemporary structural barriers to effective conflict resolution, defining where adjudication ends and ADR-and particularly the recent development of mediated third party intervention from an 'art' to a veritable 'science'-must come into play.

The work starts by defining the challenges, potentials and shortcomings of different approaches to conflict resolution in an interdependent world-where the multiplicity of actors, topics and interests involved even in seemingly bilateral conflict situations is clearly manifest-and goes on to define useful models and connect the various elements relevant for the resolution of conflicts in a transparent way.