Highbury International AVV and Ramstein Trading Inc. v. Bolivarian Republic of Venezuela (I)
ICSID · Investment (ICSID and treaty) · Venezuela · 26 Sep 2013
Why it matters
This case illustrates the strict requirement for claimants to prove ownership of investments at the critical date for ICSID jurisdiction. The Tribunal dismissed the claims for lack of jurisdiction ratione personae and ratione temporis, emphasizing that failure to provide sufficient evidence of corporate ownership and control can defeat jurisdiction. It also declined to rule on whether Venezuela's Investment Law contains a standing offer to arbitrate, as the claimants lacked standing.
Summary
Highbury International AVV (Netherlands) and Ramstein Trading Inc. (Panama) initiated ICSID arbitration against Venezuela under the Netherlands-Venezuela BIT, alleging expropriation of mining concessions (Alfa and Delta) related to the Tocoma hydroelectric project. Venezuela raised four jurisdictional objections. The Tribunal first addressed whether the claimants owned the investments at the relevant dates. For the Alfa concessions, the Tribunal found that Highbury failed to prove it owned shares in Caromin Venezuela (the concession holder) at the critical dates. For the Delta concessions, the Tribunal found that VMC (a Venezuelan company allegedly owned by Ramstein) did not validly acquire the concessions due to non-compliance with Venezuelan mining law requirements for transfer. Consequently, the Tribunal upheld Venezuela's first objection, finding it lacked jurisdiction ratione personae and ratione temporis. It did not rule on the other objections or the applicability of Venezuela's Investment Law. The Tribunal ordered each party to bear its own legal costs and share ICSID costs equally.
The detail
Parties: Highbury International AVV and Ramstein Trading Inc. v. Bolivarian Republic of Venezuela (I)
Case number: ICSID Case No. ARB/11/1
Outcome: The Tribunal upheld Venezuela's first jurisdictional objection, finding it lacked jurisdiction because the claimants failed to prove ownership of the alleged investments at the relevant dates.
Applicable law: ICSID Convention; BIT between Venezuela and the Netherlands (1991); Venezuelan Investment Law (Decree No. 356); Venezuelan Mining Laws (1945 and 1999); Law on Promotion of Private Investment under Concessions.
Issues in play: The dispute centered on whether the claimants held qualifying investments under the BIT and ICSID Convention. The Tribunal applied the BIT's definition of investment and the requirement that the investor own or control the investment at the time the dispute arose.
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