Diamante Trading Investments Ltd. and others v. Bolivarian Republic of Venezuela
PCA · Investment (ICSID and treaty) · Venezuela · 27 May 2025
Why it matters
This award is significant for its treatment of dual nationals under the Spain-Venezuela BIT, holding that dual nationals of the host state and the other contracting state can be investors if they have effective nationality of the other state. It also provides a detailed analysis of indirect expropriation and valuation in the context of Venezuela's economic measures, including the use of parallel exchange rates.
Summary
The case concerns claims by seven claimants (six individuals and one company) against Venezuela under the Spain-Venezuela and Barbados-Venezuela BITs. The claimants owned Herrera, a Venezuelan food distribution company, and related real estate. In 2014-2015, Venezuela took measures including price controls, criminal investigations, and appointment of a temporary board, which the claimants argued amounted to an indirect expropriation. The tribunal, in a partial award on jurisdiction (2022), had already rejected Venezuela's objections. In the final award (2025), the tribunal found that Venezuela's actions constituted an illegal expropriation. It held that the individual claimants with dual Spanish-Venezuelan nationality were investors under the Spain-Venezuela BIT because their dominant nationality was Spanish. The tribunal valued the expropriated business using a DCF method and the real estate using market value, applying a parallel exchange rate (SICAD II) to convert bolivars to USD. It awarded USD 99.6 million in total, with compound interest at 11.54% from the valuation date (11 January 2015). The tribunal also ordered Venezuela to pay EUR 1.34 million and USD 6.29 million in costs.
The detail
Parties: Diamante Trading Investments Ltd. and others v. Bolivarian Republic of Venezuela
Case number: PCA Case No. 2019-49
Outcome: Tribunal found Venezuela expropriated the claimants' investments illegally and awarded damages totaling approximately USD 99.6 million plus interest and costs.
Quantum: USD 99,628,035.83 (total to all claimants) plus interest and costs
Applicable law: Spain-Venezuela BIT (1995), Barbados-Venezuela BIT (1994), UNCITRAL Arbitration Rules (1976)
Issues in play: The case involved the definition of 'investor' under the Spain-Venezuela BIT for dual nationals, and whether the claimants' interests constituted protected investments. The tribunal also addressed the standard for indirect expropriation and valuation of the expropriated assets.
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