Espíritu Santo Holdings v. Mexico, Addendum to Claimant's the Memorial on the Merits

28 Jan 2022
Espíritu Santo Holdings, LP and L1bre Holding, LLC v. United Mexican States (I), ICSID Case No. ARB/20/13
Document provided by: Investor-State LawGuide
Document Summary: 

This document is an addendum to a Claim Memorial, filed by Claimant L1bre Holding, LLC in a consolidated ICSID arbitration against the United Mexican States (ICSID Case Nos. ARB/20/13 and ARB/21/55). The submission supplements and incorporates by reference the Claim Memorial previously filed by co-claimant Espíritu Santo Holdings, LP. The primary purpose of the addendum is to establish the Tribunal's jurisdiction over L1bre Holding's specific claims and to articulate its basis for damages. L1bre Holding asserts that all jurisdictional requirements under the NAFTA, the USMCA's legacy investment provisions (Annex 14-C), and the ICSID Convention have been satisfied. It posits that it is a protected investor of the United States with a qualifying "legacy investment" in Mexico, namely its ownership of the Mexican enterprise Servicios Digitales Lusad S. de R.L. de C.V. ("Lusad"). The Claimant confirms it has met procedural prerequisites, including consenting to arbitration, waiving the right to pursue domestic proceedings, and filing its claims within the prescribed limitation periods. On the merits, L1bre Holding alleges that Mexico's measures, particularly the indefinite suspension of a concession granted to Lusad, constitute breaches of NAFTA Articles 1102 (National Treatment), 1105 (Minimum Standard of Treatment), and 1110 (Expropriation). The Claimant advances two distinct claims for damages: one for its own losses as an investor under NAFTA Article 1116, and a second on behalf of its subsidiary, Lusad, for losses sustained by the enterprise, pursuant to NAFTA Article 1117. For quantum, L1bre Holding adopts the valuation methodology and findings of the expert report by Howard Rosen of Secretariat Advisors, which was submitted with the original Claim Memorial. It claims damages of not less than USD $2.802 billion (reflecting interest as of 17 September 2021) for its direct losses under Article 1116. For its claim on behalf of Lusad under Article 1117, it claims a pre-withholding tax enterprise value of USD $1.869 billion, plus pre- and post-award interest. The Claimants collectively seek a declaration of Mexico's treaty breaches, an award of damages, full reimbursement of costs, and an order that the award be net of all Mexican taxes.