Bacilio Amorrortu USA v The Republic of Peru - PCA Case No 2020-11 - Final Award on Costs - 25 October 2022
Country
Year
2022
Summary
FINAL AWARD ON COSTS
The Arbitral Tribunal
Hon. Ian Binnie, CC, KC (Presiding Arbitrator)
Prof. Bernard Hanotiau
Mr. Toby Landau, KC
TABLE OF CONTENTS
INTRODUCTION
The Parties
Background
PROCEDURAL HISTORY
COSTS OF ARBITRATION
The Claimant's Position
The Respondent's Position
The Tribunal's Analysis
1. Relevant Provisions
2. Allocation of the Costs of Arbitration
3. Quantification of the Costs of Arbitration
DECISION
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BACKGROUND
5. The present Award is the second and final award in a dispute concerning the Respondent's alleged frustration of the Claimant's legitimate expectations to obtain a contract to perform oil drilling and extraction operations in oil Blocks III and IV of the Talara Basin, in the Province of Talara, Piura Region, Peru.
6. On February 13, 2020, the Claimant commenced these arbitral proceedings by serving upon the Respondent a Notice of Arbitration (the "Notice of Arbitration") pursuant to Chapter 10 of the United States-Peru Trade Promotion Agreement, ratified by Peru in June 2006, signed by the United States on December 14, 2007, and entered into force on February 1, 2009 (the "USPTPA" or the "Treaty") and Article 3 of the Arbitration Rules of the United Nations Commission on International Trade Law, as revised in (the "UNCITRAL Rules").
7. On August 5, 2022, the Tribunal issued a Partial Award on Jurisdiction (the "Partial Award") in which it decided as preliminary questions two objections raised by the Respondent: (i) the Respondent's objection under Article 10.20.4 of the Treaty ("Objection 1"); and (ii) the Respondent's objection that Mr. Amorrortu did not submit a valid waiver as required under Article 10.18.2(b) of the Treaty ("Objection 4"). The Tribunal there dismissed Objection 11 and upheld, by majority, Objection 4
8. The dispositive part of the Partial Award reads as follows:
For the reasons outlined above, the Tribunal by majority: (i) finds that the Claimant has failed to comply with the requirement of Article10.18.2(b)
of the USPTPA by not providing a compliant waiver within the deadline specified in Article 10.16.4 of the USPTPA;
(ii) finds that the Claimant has failed to establish the requirements for the Respondent's consent to arbitrate under the USPTPA;
(iii) rejects the Claimant's request for leave to amend his Notice of Arbitration in order to attempt to cure his defective waiver;
(iv) dismisses the Claimant's claims for lack of jurisdiction; and
(v) reserves the issue of costs pending receipt of the submissions from the Parties, after which the Tribunal will render a Final Award
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DECISION
46. For the reasons outlined above, the Tribunal:
(i) declares that the Claimant shall bear two-thirds of the costs claimed by the Respondent in connection with these proceedings;
(ii) accordingly, orders the Claimant to reimburse USD 1,029,080.18 to the Respondent towards its costs in this arbitration, together with annually-compounded interest at the rate of 1 % above the 6-month LIBOR commercial lending rate for US dollars and, if this Award has not been fully satisfied by the Claimant as of the date of discontinuance of publication of LIBOR rates, interest will continue to accumulate at 1% above the rate last published prior to discontinuance of publication of LIBOR;
(iii) directs the Parties to indicate no later than Wednesday, November 9, 2022 whether they wish to designate any information contained in this Final Award on Costs as confidential or protected information in accordance with the UNCITRAL Transparency Rules and Article 10.21 of the Treaty prior to the publication of this Final Award, for which purpose the Tribunal shall remain constituted; and
(iv) dismisses all other requests for relief.
October 25,
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