Kimberly-Clark Dutch Holdings, B.V., Kimberly-Clark S.L.U., and Kimberly-Clark BVBA v. Bolivarian Republic of Venezuela
ICSID · Investment (ICSID and treaty) · Venezuela · 5 Nov 2021
Why it matters
This case is significant for its detailed analysis of consent to arbitration under the ICSID Additional Facility and the limits of MFN clauses in investment treaties. The tribunal rejected the use of MFN clauses to establish jurisdiction where the basic treaty did not offer the arbitration option sought, reinforcing the principle that consent must be clear and cannot be imported via MFN if the host state did not agree to that forum in the base treaty.
Summary
Three Kimberly-Clark entities (Dutch, Spanish, Belgian) brought an ICSID Additional Facility arbitration against Venezuela under three separate bilateral investment treaties (BITs). They alleged that Venezuela interfered with their production and distribution of Kimberly-Clark products. Venezuela objected to jurisdiction, arguing that the dispute resolution clauses in each BIT did not consent to arbitration under the Additional Facility Rules. The tribunal had to interpret each BIT's arbitration clause. For the Dutch BIT, Article 9(2) provided for ICSID Convention arbitration or UNCITRAL rules, but not Additional Facility. The tribunal found no consent to AF arbitration and rejected the claimants' attempt to use the MFN clause to import broader consent from other treaties. For the Spanish BIT, Article XI(2) similarly offered ICSID or UNCITRAL, not AF; the MFN clause could not create jurisdiction. For the Belgian BIT, Article 9(3) originally offered ICSID Convention arbitration, but Venezuela's denunciation of the ICSID Convention meant that option was unavailable; the clause did not provide for AF arbitration, and the MFN clause could not fill the gap. The tribunal concluded it lacked jurisdiction over all claims. It ordered each party to bear its own costs and the claimants to bear the arbitration costs.
The detail
Parties: Kimberly-Clark Dutch Holdings, B.V., Kimberly-Clark S.L.U., and Kimberly-Clark BVBA v. Bolivarian Republic of Venezuela
Case number: ICSID Case No. ARB(AF)/18/3
Outcome: The Tribunal lacked jurisdiction to hear the claims; each party bears its own costs.
Applicable law: Dutch BIT (1991), Spanish BIT (1995), Belgian BIT (1998); ICSID Additional Facility Rules
Issues in play: The dispute centered on whether the dispute resolution clauses in the three BITs provided consent to ICSID Additional Facility arbitration, and whether MFN clauses could import such consent from other treaties.
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