Claimant ordered to pay reasonable share of Venezuela’s legal expenditures, plus interest, as well as full costs of arbitration; failure to comply with security for costs order taken into account in decision on costs

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Tribunal sees no evidence of a genuine investment

BIT’s definition of ‘investment’ needs to be interpreted in light of general requirements inherent in investment system rationale

Venoklim failed to prove that claimant’s establishment in the Netherlands had any other purpose than to ‘internationalise’ a domestic investment

ISDS system requires more than formal compliance with nationality requirements to qualify as foreign investor

First tribunal’s findings on claimant’s qualification as ‘investor’ fail to meet triple-identity test, and thus do not amount to res judicata

Tribunal finds support in other awards that saw no grounds for ‘fallback options’ after Venezuela’s withdrawal from ICSID Convention

Consent to ICSID Additional Facility Rules arbitration was intended to apply only until Venezuela ratified the ICSID Convention

Parties’ reference to prevailing treaty language is not a mere suggestion, but a binding indication

In light of clear textual elements, tribunal excludes that “unconditional consent” to ICSID arbitration can transfer to ICSID AF arbitration

Background: Second arbitration sees notable procedural developments, including order on security for costs

While Mexico prevailed, the state’s procedural misconduct should be taken into account in apportioning costs

NAFTA’s Article 1116 does not allow claims for reflective losses

All remaining claimants qualify as investors, even if they disposed of their share before filing the case or held them indirectly

The centre of gravity of both claimants’ activities points toward their dominant and effective nationalities being Mexican, as illustrated by their roles at the highest echelons of the state’s political and business life

Dominant and effective nationality test applies under NAFTA, as confirmed by agreement of all three NAFTA states

While NAFTA considers permanent residents as nationals, it provides no particular rule on claims by dual nationals

Other treaties and precedents have limited value in steering the tribunal’s interpretation

Assessment of the evidence on allegations of corruption cannot be reduced to a single standard, but “compelling and particularized evidence” is needed

Background: Mexican bankruptcy proceedings follow cancellation of oil rig leasing contracts and prompt NAFTA claim

UNCITRAL tribunal issues procedural orders on NAFTA Article 1128 and a request for exclusion of a witness statement by a government employee

Tribunal declines to order interest on costs, finding that this claim was submitted belatedly

Tribunal examines in detail if the respondent’s costs are within reason, and awards Panama 2/3 of its reasonable costs

Expropriation claim is rejected; even if duty to pay compensation qualified as condition of lawfulness for regulatory takings, this condition would be fulfilled

Claimant’s calculation of damages was unconvincing

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