Alapli Elektrik B.V. v. Republic of Turkey
ICSID · Investment (ICSID and treaty) · Turkey · 16 Jul 2012
Why it matters
This case is significant for its detailed analysis of the ratione temporis jurisdictional objection in investment treaty arbitration. The majority held that a dispute existing before the investment was made cannot be brought under the treaty, reinforcing the principle that treaty protection is for future disputes. The dissenting opinion provides a contrasting view on when a dispute crystallizes.
Summary
Alapli Elektrik B.V., a Dutch company, invested in a Turkish power project by acquiring shares in a Turkish project company on March 30, 2000. The project involved a concession contract for a power plant. Turkey enacted laws in 2000 (Law No. 4501 and Law No. 4628) that changed the regulatory framework, allegedly harming the investment. Alapli claimed these changes violated the Energy Charter Treaty and the Netherlands-Turkey BIT. Turkey objected to jurisdiction, arguing that the dispute existed before the investment was made, so the tribunal lacked jurisdiction ratione temporis. The majority of the tribunal (President Park and Arbitrator Stern) agreed, finding that the dispute had already arisen by March 30, 2000, based on pre-investment negotiations and demands by Turkey. Therefore, the claims were dismissed. Arbitrator Lalonde dissented, arguing that the dispute crystallized only after the investment, and that the tribunal should have jurisdiction. The case illustrates the importance of timing in investment treaty claims and the application of the 'dispute existing before investment' doctrine.
The detail
Parties: Alapli Elektrik B.V. v. Republic of Turkey
Case number: ICSID Case No. ARB/08/13
Outcome: The Tribunal dismissed the claims on jurisdictional grounds, finding that the dispute arose before the claimant made its investment, thus the tribunal lacked jurisdiction ratione temporis.
Applicable law: Energy Charter Treaty (ECT); Netherlands-Turkey BIT; ICSID Convention
Issues in play: The case involved the temporal scope of investment treaty protection, specifically whether the dispute existed before the investment was made, and the application of the 'Salini criteria' for defining an investment under the ICSID Convention.
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