{"id":421,"date":"2010-01-12T14:25:00","date_gmt":"2010-01-12T19:25:00","guid":{"rendered":"http:\/\/itn.mattrock.ca\/2010\/01\/12\/uncitral-claimant-given-30-days-to-appoint-new-arbitrator-in-uk-argentina-bit-dispute\/"},"modified":"2013-01-24T02:49:46","modified_gmt":"2013-01-24T08:49:46","slug":"uncitral-claimant-given-30-days-to-appoint-new-arbitrator-in-uk-argentina-bit-dispute","status":"publish","type":"post","link":"https:\/\/www.iisd.org\/itn\/2010\/01\/12\/uncitral-claimant-given-30-days-to-appoint-new-arbitrator-in-uk-argentina-bit-dispute\/","title":{"rendered":"UNCITRAL Claimant Given 30 days to Appoint New Arbitrator in UK-Argentina BIT Dispute"},"content":{"rendered":"

By Elizabeth Whitsitt<\/strong><\/span><\/p>\n

January 13, 2010<\/strong><\/span><\/p>\n

Later this month UK-based firm, ICS<\/span> Inspection and Control Services Limited (ICS), is expected to appoint another arbitrator in its dispute against the Argentine Republic which began earlier this summer.<\/span><\/p>\n

On July 28, 2009 in accordance with the UNCITRAL<\/span> Arbitration Rules, ICS appointed Mr. Stanimir A. Alexandrov as its nominee to the three-member arbitral tribunal that would decide the outcome of its dispute with Argentina under the UK-Argentina BIT<\/span>.<\/span><\/p>\n

Subsequently, Mr. Alexandrov, a partner with Sidley Austin LLP, informed the parties that his law firm had previously represented PWC Logistics, a company with potential connections to ICS.\u00a0 In addition, Mr. Alexandrov notified the parties that he and his law firm were currently counsel to Compa\u00f1\u03afa de Aguas del Aconquija S.A. and Vivendi S.A., claimants in a long-standing dispute against the Argentine Republic over the provision of water and sewer services (the Vivendi case).*<\/span><\/p>\n

Less than a week later, Argentina challenged Mr. Alexandrov\u2019s appointment relying on Article 10(1) of the UNCITRAL Rules which provides that, \u201c[a]ny arbitrator may be challenged if circumstances exist that give rise to justifiable doubts as to the arbitrator\u2019s impartiality or independence.\u201d<\/span><\/p>\n

On December 17, 2009 Mr. Jernej Sekolec, the appointing authority designated by the Secretary-General of the Permanent Court of Arbitration to hear the challenge, sided with Argentina.<\/span><\/p>\n

In reaching this conclusion, Mr. Sekolec rejected arguments raised in opposition to the challenge that the Vivendi case was coming to a conclusion and unrelated to the dispute between ICS and Argentina.<\/span><\/p>\n

With respect to the former argument, Mr. Sekolec acknowledged that no more action may be required of Mr. Alexandrov given the status of annulment proceedings in the Vivendi case.\u00a0 However, he determined that this reality did not negate Mr. Alexandrov\u2019s conflict as there was still some possibility that the case may continue and \u201cengage Mr. Alexandrov\u2019s firm\u2019s continued representation.\u201d<\/span><\/p>\n

Regarding the latter argument, Mr. Sekolec noted that the Vivendi case and dispute between ICS and Argentina were \u201cnot entirely dissimilar\u201d as \u201c[b]oth matters are investment protection actions of considerable magnitude which raise broadly similar concerns against the same State party\u2026\u201d\u00a0 In addition, he noted that justifiable doubts as to an arbitrator\u2019s impartiality and independence may arise even in circumstances where an arbitrator has represented one of the parties \u201cin an unrelated matter.\u201d<\/span><\/p>\n

In sustaining Argentina\u2019s challenge, Mr. Sekolec acknowledged that there was \u201c\u2026no reason to doubt Mr. Alexandrov\u2019s personal intention to act impartially and independently\u2026\u201d\u00a0 However, he determined that Mr. Alexandrov and his law firm were \u201c\u2026in a situation of adversity toward Argentina\u2026\u201d and such situations should \u201cbe avoided, except where circumstances exist that eliminate any justifiable doubts as to the arbitrator\u2019s impartiality or independence.\u201d<\/span><\/p>\n

As support for his decision, Mr. Sekolec also referenced the IBA Guidelines on Conflicts of Interest in International Arbitration (IBA Guidelines) and noted that there were two examples of potential conflicts of interest on the \u201cOrange List\u201d of the IBA Guidelines that were relevant to this case.\u00a0 First, justifiable doubts as to an arbitrator\u2019s impartiality or independence may arise where \u201can arbitrator\u2019s law firm is currently acting adverse to one of the parties\u2026\u201d or second, where \u201c[an] arbitrator has within the past three years served as counsel against one of the parties\u2026\u201d<\/span><\/p>\n

Having found that the facts underlying Mr. Alexandrov\u2019s August 7th disclosure to the parties were reflected in those two scenarios, Mr. Sekolec held that the situation \u201c\u2026[gave] rise to objectively justifiable doubts as to Mr. Alexandrov\u2019s impartiality and independence.\u201d\u00a0 Accordingly, Mr. Sekolec gave ICS 30 days from December 17, 2009 to find a replacement arbitrator.<\/span><\/p>\n

* Previous ITN<\/span> reporting on the Vivendi case can be found here:<\/span><\/p>\n

\u201cVivendi Will Resubmit Argentine Water Claim, Following Recent ICSID<\/span> Decision,\u201d By Luke Peterson, Investment Law and Policy Weekly News Bulletin, 1 August 2003, available here:<\/span><\/p>\n

http:\/\/www.IISD<\/span>.org\/pdf\/2003\/investment_investsd_aug1_2003.pdf<\/span><\/a><\/p>\n

\u201cArgentina liable for $100+ Million after expropriating Vivendi water concession,\u201d By Luke Eric Peterson, Investment Treaty News, 30 August 2007, available here:<\/span><\/p>\n

http:\/\/www.IISD<\/span>.org\/pdf\/2007\/itn_aug30_2007.pdf<\/span><\/a><\/p>\n

Sources:<\/span><\/p>\n

Decision on the Challenge to Mr. Stanimir A. Alexandrov in ICS Inspection and Control Services Limited (United Kingdom) v. Republic of Argentina, UNCITRAL is available here:<\/span><\/p>\n

http:\/\/ita.law.uvic.ca\/documents\/ICSArbitratorChallenge.pdf<\/span><\/a><\/p>\n

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