CMC Muratori Cementisti CMC Di Ravenna SOC. Coop., CMC MuratoriCementisti CMC Di Ravenna SOC. Coop. A.R.L. Maputo Branch and CMC Africa, and CMC Africa Austral, LDA v. Republic of Mozambique
ICSID · Investment (ICSID and treaty) · Mozambique · 24 Oct 2019
Why it matters
This award is notable for its detailed analysis of the relationship between the Cotonou Convention and a bilateral investment treaty, an issue of first impression in ICSID arbitration. It also addresses the applicability of the ECJ's Achmea judgment to a non-EU state (Mozambique), confirming that Achmea does not deprive an ICSID tribunal of jurisdiction over a BIT claim against a non-EU respondent. The case illustrates the complexity of jurisdictional objections in investment arbitration involving overlapping treaty regimes.
Summary
Italian construction company CMC and its Mozambican subsidiaries entered into a contract with Mozambique's national roads administration (ANE) to rehabilitate a highway (Lot 3 Project), financed by the European Development Fund. After completing the work in 2007, CMC sought additional compensation for extra works. The Engineer determined amounts due in 2009, but CMC was dissatisfied. ANE made a settlement offer of EUR 8,220,888 on 30 October 2009. CMC responded on 2 November 2009, which CMC claims was an acceptance but Mozambique argues was a counteroffer that was never accepted. The amount was never paid. After years of discussions, CMC initiated ICSID arbitration in 2017 under the Italy-Mozambique BIT, alleging breaches of fair and equitable treatment, impairment of investments, and failure to maintain a legal framework. Mozambique raised multiple jurisdictional objections: that claimants were not investors, had no investment, claims were contractual not treaty-based, the Cotonou Convention superseded the BIT, and the ECJ's Achmea judgment deprived the tribunal of jurisdiction. The Tribunal rejected all objections, finding it had jurisdiction. On the merits, the Tribunal held that no settlement agreement was formed (CMC's letter was a counteroffer), and Mozambique's conduct did not breach the BIT. All claims were dismissed. The Tribunal split costs equally, each party bearing its own.
The detail
Parties: CMC Muratori Cementisti CMC Di Ravenna SOC. Coop., CMC MuratoriCementisti CMC Di Ravenna SOC. Coop. A.R.L. Maputo Branch and CMC Africa, and CMC Africa Austral, LDA v. Republic of Mozambique
Case number: ICSID Case No. ARB/17/23
Outcome: The Tribunal upheld its jurisdiction but dismissed all claims on the merits. Each party bears its own costs; arbitration costs split equally.
Applicable law: Italy-Mozambique BIT (1998); ICSID Convention; Cotonou Convention; Mozambique law; EU law (Achmea issue)
Issues in play: The case involved the interplay between the BIT and the Cotonou Convention's arbitration provisions, and the impact of the ECJ's Achmea judgment on intra-EU BITs. The Tribunal found the BIT not superseded by the Cotonou Convention and that Achmea does not apply to non-EU respondent.
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