Tekfen TML Joint Venture v Libya
ICC · Investment (ICSID and treaty) · Switzerland · 11 Feb 2020
Why it matters
This award is significant for its detailed analysis of the full protection and security standard in the context of a state's collapse during civil unrest. It clarifies that a state's duty to protect investments is not absolute but requires reasonable measures, and that force majeure and necessity defenses are narrowly construed. The case also addresses the temporal scope of BIT protections and the use of MFN clauses to import umbrella clauses.
Summary
The case arises from the Great Man-Made River Project (GMMRP) in Libya, one of the world's largest civil engineering projects. Claimants, Turkish construction companies, contracted with the Libyan state entity GMMRA to build a water conveyance system. During the 2011 Libyan uprising, Claimants evacuated their personnel, and their equipment and camps were looted. Claimants alleged Libya failed to provide full protection and security (FPS) under the Turkey-Libya BIT and customary international law. Libya argued that the BIT had not entered into force, that Claimants were not protected investors, that the dispute arose before the BIT's entry into force, and that its failure was excused by force majeure or necessity. The tribunal held that the BIT was in force, Claimants were protected investors, and the dispute arose after the BIT's entry into force. It found Libya liable for breaching the FPS standard, rejecting force majeure and necessity defenses because Libya had not taken reasonable measures to protect the investments. The tribunal emphasized that the FPS standard requires due diligence, not strict liability, and that Libya's security forces were present but failed to act. Quantum was reserved for a later phase.
The detail
Parties: Tekfen TML Joint Venture v Libya
Case number: ICC Case No. 21371/MCP/DDA
Outcome: The Tribunal found that Libya breached its obligation to provide full protection and security under customary international law and the Turkey-Libya BIT. Libya was held liable for failing to protect Claimants' investments during the 2011 uprising. Quantum was reserved for a later phase.
Applicable law: Turkey-Libya BIT (2009), OIC Treaty, Austria-Libya BIT (via MFN), customary international law, ICC Rules
Issues in play: The case involved the collision between a state's duty to provide full protection and security (FPS) to foreign investments and the state's inability to maintain security during a civil uprising. The tribunal had to determine whether the state's failure was excused by force majeure or necessity.
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