Summary

Source: icsid.worldbank.org

CHAPTER 1: INTRODUCTION

1. Norway hereby submits its Rejoinder on Annulment, in accordance with the procedural timetable as amended on 30 June 2025.

2. The Applicants have applied to annul the Award of 22 December 2023, the possible grounds for which are exhaustively set out in Article 52 of the ICSID Convention.

However, most of the Applicants' 22 annulment grounds are an attempt to re-argue points that were raised and decided before the Tribunal. The Applicants' Reply Memorial ("Reply") does nothing to overcome this fundamental hurdle; indeed, its approach of simply restating points, rather than engaging with the substance of Norway's argument, only serves to amplify this issue.

3. The Applicants' annulment application should be considered against the following background:

(a) The underlying arbitration of this matter was an attempt to attack Norway's sovereign rights as a coastal State under the UN Convention on the Law of the Sea ("UNCLOS"), dressed up as an investment dispute;

(b) Before the Tribunal, it was not disputed that the Russian continental shelf in the Barents Sea contained a higher density of snow crab than the Norwegian continental shelf (Award, para. 82). At the time when the Applicants began harvesting snow crab on the Russian continental shelf, the same activity on the Norwegian continental shelf was still mostly unregulated. When it became clear that the activity could be commercially viable, Norway introduced regulations on the harvesting of snow crab in its maritime areas. A prohibition on harvesting within 200 nautical miles was adopted on 19 December 2014 and entered into force on 1 January 2015. Later, in December 2015, the prohibition was extended to the Norwegian continental shelf beyond 200 nautical miles.

(c) The Applicants were not affected by these regulations, because the vast majority of their snow crab harvesting activity took place on the Russian continental shelf (Award, paras. 106 and 266-267). As such, their activities continued unabated until September 2016, when the Russian Federation introduced a ban on non- Russian vessels harvesting snow crab on the Russian continental shelf in the Loop Hole. At that time, the Applicants' harvesting activities came to an abrupt halt;

(d) It was then, and only then, that the Applicants started taking interest in harvesting snow crab on the Norwegian continental shelf. However, Norway had for some time restricted that activity;

(e) The Norwegian regulations were challenged by the Applicants or their associates in Norwegian courts, both through criminal and civil proceedings.

Both sets of proceedings were taken all the way through the Norwegian court system, where the penal case was finally decided by the Supreme Court as a grand chamber in 2019 and the civil case by the Supreme Court in plenary in 2023. In both cases, they were unsuccessful at every level of the Norwegian judicial system;

(f) Rather than accepting the fact that Norway had used its right to regulate and take control of a marine resource over which it has sovereign rights under UNCLOS, the Applicants chose to challenge Norway's use of its sovereign rights through the current investment dispute;

(g) The Tribunal found that Norway had committed no breach of the Agreement of 16 June 1992 between the Government of the Kingdom of Norway and the Government of the Republic of Latvia on the Mutual Promotion and Protection of Investments (the "BIT"). The Tribunal also found that the Applicants' claim that Norway `conspired with' or `incited' the Russian Federation to restrict the Applicants' access to the Russian continental shelf, was inadmissible.

4. In Norway's view, this was--and remains--a straightforward case. The problem with the Applicants' business model was that it was premised on harvesting snow crab in the absence of any prohibition, rather than with the express permission of the state entitled under UNCLOS to regulate access. As Mr Levanidov said as early as August 2013: "sooner or later there will be introduced quotas".1 Once the resource was regulated, they had no legal access to it. The blame for the failure of their business venture is not to be laid at Norway's door. As the Tribunal found at Award paragraph 543:

The Claimants have argued that Norway acted in order to exclude the EU vessels harvesting snow crab on its continental shelf and reserve the resource for its own fishing industry, but that is exactly what [UNCLOS] Article 77 provides for. There is nothing extraneous or improper in Norway acting in this way. Nor is there anything wrong with it using its sovereign rights as a bargaining chip with the EU which has done the same in relation to marine resources in the continental shelves and EEZs of its Member States.

5. However, throughout both the underlying Arbitration, and in this annulment application, the Applicants have pursued a systematic strategy of expanding and attempting to complicate the case. The Applicants' wide-ranging document production requests in the underlying arbitration were largely accepted by Norway. The vast majority of the disclosed documents were irrelevant, and none supported the Applicants' alleged Russo-Norwegian conspiracy. Norway was awarded its costs, having spent significant public resources defending the claim. The Applicants have not paid them.

6. Having lost entirely, the Applicants' strategy has continued in the annulment phase.

7. First, the Applicants' grounds for annulment are wide-ranging, and argue in effect that each and every part of the Award with which they disagree is annullable. There is very little effort made to tie the 22 pleaded grounds to the actual grounds for annulment set out in Article 52 of the ICSID Convention. Several of the Applicants' grounds simply amount to an appeal from the findings of the Tribunal. Although these arguments are labelled as either a "failure to state reasons" or a "manifest excess of powers", the reality is that they are not.

(a) There was no impediment whatsoever to the Applicants setting out their full case exactly as they chose in their extensive written pleadings and at the hearing before the Tribunal;

(b) If Norway chose not to respond to certain points made by the Applicants because it regarded them as incoherent or hopeless, or to respond only in general terms, it did so at its own risk and without any consequential restriction on the Applicants;

(c) The Tribunal heard and determined the Applicants' arguments. The Applicants simply disagree with the outcome, as they did when Norway legally changed its regulations, and as they did when the Norwegian Supreme Court (twice) ruled against SIA North Star.

8. Norway attaches, as an Appendix to this Rejoinder, a table identifying the main places where the Applicants' grounds in the present annulment proceeding have already been argued by the parties, and considered and dismissed by the Tribunal.

9. Secondly, despite the expectation expressed by the ad hoc Committee in Procedural Order No. 1, paragraph 15.3 "that the parties will refer primarily to the evidentiary record from the arbitration proceeding and [the ad hoc Committee] does not expect to receive new evidence" the annulment proceeding has included two extensive rounds of document production, and whilst the Applicants attempt to make much of the disclosed document, they add nothing substantive to the debate.

10. Thirdly, the Applicants have attempted to turn up the heat by attacking Norway's behaviour in the arbitration, which they label as "fundamentally improper". These allegations are serious, and have for that reason been treated by Norway with the gravity they warrant. But they have no factual foundation.

11. As to the Applicants' allegations that Norway "intentionally" sought to hire external counsel in the knowledge of an alleged conflict of interest, they have failed to identify a single document or piece of information obtained improperly by Norway:

(a) Mindful of the ad hoc Committee's encouragement in Procedural Order No. 3 paragraph 76 to "to provide as much factual detail as possible in its Counter- Memorial on all third-party engagements discussed in this Order", Norway provided a detailed background in its Counter-Memorial of 22 April 2025 at §4.A on this issue. In addition, it disclosed at the Applicants' request more than 40 documents relating to its hiring of external counsel, which have been added to the record;

(b) The Applicants now seem to accept that Norway neither sought nor obtained any such confidential information. Certainly, that is what the document production shows. In response, though, the Applicants have repeated and even reinforced their speculative and groundless allegations in their Reply at §IV.C;

12. Further, the allegation that Norway "simply lied to the Tribunal" to obtain bifurcation of damages (Reply, para. 324) seems to be based on a single line description of an item in Norway's costs submissions2. To prove that the allegation was entirely misconceived, Norway sought and obtained the ad hoc Committee's permission to submit the document referred to in those costs submissions.3 As is evident from that document, Norway did not lie to or mislead the Tribunal. Such a serious allegation should not have been made without the proper evidential foundations. Rather than accepting that the documentary evidence does not support their case, the Applicants have continued their attack on Norway, culminating in the request to cross-examine Norway's agents about their alleged lack of independence from the State on whose behalf they are authorised to speak.

13. The Applicants' Reply is mostly a verbatim repetition of their Memorial of 21 January 2025, with very few additions, amendments or deletions. The Applicants' submission of their `tracked changes' Reply makes this clear and also demonstrates the fact that the Applicants have largely failed to engage with or respond to the points made by Norway in its Counter-Memorial, or the further documents disclosed by Norway. Several of the tracked changes are typographical amendments or inconsequential formatting changes, for example moving the positions of footnotes in the text.

14. Save as otherwise stated herein:

(a) Defined terms from the Parties' previous submissions are adopted;

(b) References to paragraphs and footnotes in the Applicants' Reply are to the clean version, not the tracked changes version; and

(c) Each and every allegation in the Applicants' Reply is denied, except where otherwise provided in this Rejoinder or in Norway's Counter-Memorial.

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CHAPTER 6: CONCLUSION & PRAYER FOR RELIEF

92. For the reasons stated in the Counter-Memorial on Annulment of 22 April 2025 and in this Rejoinder, the Respondent respectfully requests the ad hoc Committee:

(a) To dismiss the annulment application in its entirety;

(b) To order the Applicants to pay the Respondent its costs, professional fees, expenses and disbursements, inclusive of interest; and

(c) To order such further or other relief as the ad hoc Committee deems appropriate.

26 August 2025
Respectfully submitted on behalf of the Kingdom of Norway

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