Gold Pool Limited Partnership v. Republic of Kazakhstan
PCA · Investment (ICSID and treaty) · Kazakhstan · 20 Jul 2020
Why it matters
This case is significant for its analysis of state succession to bilateral investment treaties following the dissolution of the Soviet Union. The tribunal's finding that Kazakhstan did not succeed to the Canada-USSR BIT clarifies the application of customary international law on treaty succession and impacts investors relying on such treaties with former Soviet republics.
Summary
Gold Pool JV Limited, a Canadian investor, initiated arbitration against Kazakhstan under the Canada-USSR BIT, claiming that Kazakhstan had breached its obligations. The dispute arose from investments in Kazakhstan's oil and gas sector. Kazakhstan objected to jurisdiction, arguing that it was not a party to the Canada-USSR BIT and had not succeeded to it after the USSR's dissolution. The tribunal, constituted under the UNCITRAL Rules and administered by the PCA, examined whether Kazakhstan succeeded to the treaty under customary international law, particularly the Vienna Convention on Succession of States in respect of Treaties. The tribunal found that Kazakhstan did not succeed to the BIT because the treaty was not in force between Canada and Kazakhstan at the time of the USSR's dissolution, and there was no evidence of mutual consent to continue its application. Consequently, the tribunal upheld the objection and declined jurisdiction, ordering the claimant to pay the respondent's costs.
The detail
Parties: Gold Pool Limited Partnership v. Republic of Kazakhstan
Case number: PCA Case No. 2016-23
Outcome: The Tribunal upheld Kazakhstan's objection to jurisdiction, finding it had no jurisdiction, and ordered the Claimant to bear the costs of arbitration and legal representation.
Applicable law: Agreement between the Government of Canada and the Government of the Union of Soviet Socialist Republics for the Promotion and Reciprocal Protection of Investments (1989); UNCITRAL Arbitration Rules (1976)
Issues in play: The central issue was whether Kazakhstan succeeded to the Canada-USSR BIT after the dissolution of the USSR, and whether the treaty remained in force between Canada and Kazakhstan.
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