Procedural Posture

This document is the Award on Jurisdiction issued on July 8, 2019, in PCA Case No. 2015-12, an arbitration conducted under the 1976 UNCITRAL Arbitration Rules and the 1990 United Kingdom-Argentina Bilateral Investment Treaty (BIT). The dispute arose from Argentina's alleged failure to pay for pre-shipment inspection and auditing services provided by the Claimant, ICS Inspection and Control Services Limited. The Respondent, the Argentine Republic, bifurcated the proceedings by raising preliminary objections to the Tribunal's jurisdiction and the admissibility of the claims.

Jurisdictional Objections and Parties' Positions

Argentina advanced three primary objections. First, it argued that the Tribunal lacked jurisdiction ratione temporis, asserting that the Claimant had assigned its contractual rights to a third-party affiliate (Ostram) and only reacquired them after the challenged measures were implemented, thereby constituting an abuse of process. Second, Argentina contended that the claims were purely contractual in nature and fell outside the Tribunal's jurisdiction ratione materiae, emphasizing that the underlying contract contained an exclusive forum selection clause in favor of Argentine courts. Third, the Respondent argued that the claims were inadmissible due to acquiescence and extinctive prescription, given the passage of time since the alleged breaches.

The Claimant maintained that it retained ownership of the investment as a whole despite the temporary assignment of specific receivables. It further argued that its claims were properly formulated as treaty breaches, invoking the BIT's umbrella clause, fair and equitable treatment (FET) standard, and full protection and security (FPS) provisions, which operate independently of the contract's forum selection clause.

Tribunal's Analysis and Findings

The Tribunal systematically dismissed the Respondent's jurisdictional objections. Regarding jurisdiction ratione temporis, the Tribunal determined that the temporary assignment of specific credits did not deprive the Claimant of its broader investment under the BIT, nor did it constitute an abusive corporate restructuring. Applying the prima facie standard, the Tribunal found that the Claimant had sufficiently pleaded breaches of the BIT's substantive protections, including the umbrella clause, which elevated the alleged contractual breaches to the international plane. The Tribunal further held that the exclusive jurisdiction clause in the underlying contract did not preclude it from exercising jurisdiction over claims founded on the BIT.

Decision

In its dispositive section, the Tribunal affirmed its jurisdiction to hear the Claimant's case under the UK-Argentina BIT. The Tribunal concluded that it was more prudent to join the Respondent's admissibility defenses regarding acquiescence and extinctive prescription to the merits phase of the arbitration, thereby ordering the continuation of the proceedings.