Procedural Background

Procedural Order No. 21 addresses an application by the Respondent, the Russian Federation, to reopen the jurisdictional phase of the arbitration. Following the Tribunal’s issuance of a Partial Award on jurisdiction and liability, the Hague Court of Appeal rendered a judgment partially setting aside that Partial Award. Relying on this judgment, the Respondent requested that the Tribunal suspend the ongoing quantum phase, reopen the jurisdictional proceedings, and issue a new award on jurisdiction.

Parties' Positions

The Respondent argued that the Hague Court of Appeal’s judgment effectively annulled the Tribunal’s general declaration of jurisdiction. Invoking Article 1065(1)(a) of the Dutch Code of Civil Procedure, the Respondent contended that the Tribunal was obligated to assess jurisdiction afresh, specifically regarding the temporal limitations of Article 12 of the applicable bilateral investment treaty (BIT), which restricts protection to investments made on or after January 1, 1992.

The Claimants opposed the application, asserting that the Hague Court of Appeal merely took a cautious approach to clarify that the Tribunal's jurisdiction did not extend to pre-1992 investments—a limitation the Tribunal had already explicitly recognized in Procedural Order No. 8. The Claimants further submitted expert legal evidence indicating that under Dutch law, a setting-aside court renders a final de novo decision on jurisdiction, thereby precluding the Tribunal from revisiting the issue.

Tribunal's Analysis

The Tribunal majority rejected the Respondent’s interpretation of the Hague Court of Appeal’s judgment. The Tribunal observed that the partial set-aside was explicitly limited to ensuring certainty that jurisdiction did not encompass pre-1992 investments. The Tribunal emphasized that it had already acknowledged this temporal limitation in Procedural Order No. 8, a fact previously conceded by the Respondent in its own pleadings. Consequently, the Tribunal concluded that the Dutch court did not invalidate its authority to adjudicate claims concerning post-1992 investments or to proceed with the quantum phase. Furthermore, relying on the Claimants' uncontroverted expert evidence on Dutch civil procedure, the Tribunal found it lacked the authority to conduct a further jurisdictional hearing.

In a concurring opinion, Professor Maja Stanivuković agreed that reopening the jurisdictional phase was unnecessary and that the temporal eligibility of specific investments could be efficiently determined during the quantum phase. However, she disagreed with the majority’s characterization that the Partial Award had fully disposed of the Article 12 jurisdictional objections, noting that the factual determination of when specific investments were made remained an unresolved jurisdictional issue properly deferred to the final award.

Decision

The Tribunal dismissed the Russian Federation’s application for a re-hearing of its jurisdictional objections. The dismissal was issued without prejudice to the Respondent’s right to address the impact of the Article 12 temporal limitations during the Tribunal's determination of the proper quantum of compensation.