Summary

Source: icsid.worldbank.org

PROCEDURAL HISTORY

1. On 30 September 2024, ExxonMobil Petroleum & Chemical BV ("EMPC" or the "Claimant") filed its Request for Arbitration against the Kingdom of the Netherlands (the "Netherlands" or the "Respondent") arguing that the Respondent has breached its obligations under international law and Article 10(1) of the Energy Charter Treaty (ECT).1 Accordingly, EMPC requested the institution of arbitration proceedings against the Netherlands in accordance with Article 26 of the ECT and Article 36 of the Convention on the Settlement of Investment Disputes between States and Nationals of Other States (the "ICSID Convention"). For the purposes of these proceedings, both ExxonMobil Petroleum & Chemical BV and the Kingdom of the Netherlands will be referred to collectively as (the "Parties").

2. On 21 October 2024, the ICSID registered the Request for Arbitration under ICSID ...

10. This Decision sets out the Tribunal's analysis and order on the Claimant's Request for Bifurcation. It addresses the procedural background, summarizes the Parties' respective submissions, outlines the applicable legal framework, and sets forth the Tribunal's reasoning and conclusions, culminating in the dispositive order. The Tribunal sets out the Parties' respective requests for relief in Section II and summarizes their positions in Section III of this Procedural Order. The Tribunal's analysis and decision are presented in Sections IV and V, respectively.

THE PARTIES' REQUEST FOR RELIEF

11. EMPC's request for relief is as follows:

"[...] EMPC respectfully requests that the Tribunal ORDER that the proceedings will be bifurcated in two phases, one to address questions of liability and determination of the unlawful elements of the Netherlands' Payment Demands, together with guidance from the Tribunal where practicable on principles of quantum, and a separate phase to address questions of quantum."

12. The Netherlands's request for relief is as follows:

"In light of the foregoing, and without prejudice to the Netherlands' right to apply for a bifurcation on issues of admissibility and jurisdiction after review of EMPC's Memorial, the Netherlands requests the Tribunal to order that the proceedings will for the time being be bifurcated in two phases: one to address questions of liability, and a separate phase (if necessary) to address questions of quantum."

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TRIBUNAL'S DISCUSSION

75. The Tribunal has carefully reviewed and considered the Parties' submissions on the Claimant's Request for Bifurcation, together with the accompanying factual exhibits and legal authorities relied upon. At this juncture, the Tribunal addresses solely the Claimant's Request. In doing so, the Tribunal emphasizes that its determination is confined strictly to procedural matters. The Tribunal's determination does not involve, nor should it be understood as involving, any findings on the merits of the dispute or on the substantive issues raised by the Parties.

76. The Tribunal further observes that the Parties, and in particular the Claimant, have submitted an extensive factual background in support of their positions. While the Tribunal acknowledges the relevance of such background to the broader dispute, it reiterates that, for the purposes of the present Request, it will only consider those aspects that are directly pertinent to the procedural question of bifurcation. The Tribunal stresses that this approach avoids any premature assessment of contested facts and ensures that its analysis remains within the proper scope of the Request.

77. In its discussion, the Tribunal will therefore focus on the submissions that are material to its analysis of bifurcation under ICSID Arbitration Rule 42. The fact that certain arguments or factual details are not expressly or specifically addressed in this section does not mean that they have been disregarded. Rather, the Tribunal confirms that all submissions have been considered, but only those relevant to the procedural determination are discussed in detail.

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ORDER

91. For the foregoing reasons, the Tribunal orders that the proceedings shall be bifurcated in two phases; the first phase shall address questions of liability, including the determination of any unlawful elements of the Netherlands' Payment Demands, and - depending on the outcome of the first phase - a subsequent phase shall encompass all damages issues including principles, assessment and calculation of quantum.

92. This Order is issued without prejudice to any jurisdictional and admissibility objections that are yet to be briefed and considered.

93. The Procedural Timetable originally adopted as Annex B to Procedural Order No. 1 is hereby revised as set out in Annex A to this Order and shall govern the subsequent phase of the proceeding.

For and on behalf of the Tribunal,

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Footnotes omitted