International arbitration

Publication | April 2012


We began 2012 by reinforcing our position as one of the top energy and mining legal practices in the world when Macleod Dixon joined Norton Rose Group on 1 January. This is in addition to our other key strengths: financial institutions; transport; technology and innovation; and pharmaceuticals and life sciences. With Macleod Dixon we are joined by more than 260 lawyers and have established a presence in Venezuela, Colombia and Kazakhstan in Central Asia, some of the most significant natural resources markets in the world. We also enhanced our resources in Canada and Russia.

Our teams in these markets bring considerable experience in international arbitration. So we have asked Ramon J Alvins, Elisabeth Eljuri and Gustavo Mata, some of our new colleagues in Caracas, Venezuela, to explore the conundrum in the disparity between the Venezuelan Constitution’s commitment to international and domestic arbitration and the state’s recent denunciation of the ICSID Convention.

We also outline the changes introduced in the recently revised ICC Rules of Arbitration. And we take a look at P.R.I.M.E. Finance, the new arbitration institution for disputes concerning complex financial products, and its chances of addressing a number of perceived failings with existing dispute resolution mechanisms in this area.

Pierre Bienvenu
Global practice leader - international arbitration
Norton Rose Group
Joseph Tirado
Head of international arbitration
Norton Rose LLP

Legal update

Venezuela withdraws from ICSID

The Venezuelan government denounced the ICSID Convention on 24 January 2012 and stated in a press release that, in future, all public interest contracts will be subject to the jurisdiction of Venezuelan national courts. In accordance with Article 71 of the ICSID Convention, the notice will take effect six months after the date on which it was given, so it will be effective in July 2012.

2012 ICC rules now in force

The new ICC rules came into force on 1 January 2012. See our article in this newsletter on the key changes.

Enforcing arbitral awards in Germany

In a recent decision (BGH NJW 2011, 1290), the German Supreme Court confirmed that a party may challenge an award in the country of enforcement without initiating set aside proceedings in the jurisdiction where the award was made. This is in line with the UK Supreme Court decision in Dallah Real Estate and Tourism Holding Company v The Ministry of Religious Affairs, Government of Pakistan [2010] UKSC 46 and with practice in many New York Convention states.

Enforcing arbitral awards in Austria

In a recent Supreme Court decision (OGH, decision 3Ob65/11x), a very strict interpretation of the award authentication requirements resulted in a foreign award being denied enforcement. The applicant had submitted a legalised copy of the arbitral award, endorsed with written confirmation by the sole arbitrator, that the copy was a true and complete copy of the original. Although the authenticity of the award was not in dispute, it was held that an arbitrator could not authenticate his own award and that a certified copy issued by the ICC Secretary General was required. The case underlines the importance of strict compliance with procedural requirements at the enforcement stage in some jurisdictions.

International arbitration in Venezuela

By Ramón J Alvins, Elisabeth Eljuri and Gustavo Mata

International and domestic arbitration is described in the Veneuzuelan Constitution as part of the state’s justice system. Yet Venezuela’s denunciation of the ICSID Convention highlights contradictions in practice within its legal system.

Article 258 of the Venezuelan Constitution goes so far as to establish that the law in Venezuela shall promote arbitration. The Constitutional Chamber of the Supreme Tribunal has interpreted this provision as imposing an obligation not only on the legislator, but also on the judiciary, stating that the latter should “promote, as much as possible, the use of means of alternative dispute resolution, and adopt all measures necessary to promote and recognise their effective operation”.

Venezuela has also ratified several international conventions on the territorial effectiveness and enforcement of arbitration agreements and arbitral awards, including the New York Convention, and it has adopted a Commercial Arbitration Law, known as the CAL.

Whilst at first glance Venezuela appears to be arbitration friendly, it is difficult to determine which disputes may be submitted to arbitration, and it can be quite arduous to enforce an award made by an international arbitral tribunal against Venezuela. Moreover, Venezuela’s recent denunciation of the ICSID Convention has left some foreign investors wondering how to obtain reparation from the Venezuelan state in the event of a future dispute.

The arbitrability of disputes

Submitting a specific dispute to arbitration, domestic or international, is contingent on an analysis of the arbitrability of the dispute. This is no easy task in Venezuela, where an intricate web of legal norms,including Supreme Court decisions, must be untangled in order to resolve the question.

In some instances the law expressly prohibits resort to arbitration. These instances, in which the Venezuelan courts have exclusive jurisdiction, include disputes concerning in rem rights over immovable property located in Venezuelan territory, crimes and misdemeanors, or family matters such as divorce. However, there is still an intense debate concerning the arbitrability of ‘public interest contracts’. This question deserves separate analysis.

“There is still an intense debate concerning the arbitrability of public interest contracts”

Article 151 of the Constitution establishes that:

All public interest contracts, if appropriate in accordance with their nature, shall be deemed to include, even if not expressly stated, a clause according to which all questions and controversies arising out of such contracts and which may not be resolved amicably shall be decided by the competent courts of the Republic, in accordance with its laws, and under no circumstance or motive may give rise to foreign claims.

Whether this provision grants Venezuela absolute immunity from the jurisdiction of foreign courts and/or from arbitral proceedings has been the subject of considerable debate by Venezuelan courts and legal scholars.

Public interest contracts are those to which the public administration, acting in the exercise of its powers, is a party. In accordance with Article 151, whenever the nature of such contracts allows for the exclusive jurisdiction clause to be inserted, it is deemed to be included. Therefore, the question of whether or not the disputes arising out of a specific public interest contract may be submitted to arbitration must be decided on a case by case basis, by conducting a thorough analysis of the nature of the contract. This was confirmed by the Supreme Court in a 2008 constitutional interpretation which concluded that Article 151 establishes a system of partial immunity from the jurisdiction of foreign courts or arbitral tribunals.

Investment arbitration

Venezuela follows Argentina as the Latin American state with the highest number of ICSID cases against it, the vast majority of which were filed in the past five years.

On January 25, 2012, Venezuela denounced the ICSID Convention. This came as no surprise to investors or to the international community at large, given that Venezuelan officials had publicly announced their intention to withdraw from ICSID jurisdiction.

The Venezuelan government argued that, as part of its constitutional mandate, it had no choice but to denounce the ICSID Convention because Article 151 of the Constitution invalidates any consent to ICSID jurisdiction under the ICSID Convention. The current position of the Venezuelan government appears to contradict the partial immunity from jurisdiction system that the Supreme Court established in its 2008 interpretative decision.

In accordance with Article 71 of the ICSID Convention, Venezuela’s notice will take effect six months after the date of notice. While this may suggest that affected investors have six months to bring any claim, before the consequences of denunciation take effect, under Article 72 of the ICSID Convention, investors protected by bilateral investment treaties (BITs) may be able to file ICSID claims after the denunciation has taken effect.

There is extensive debate about the proper interpretation of Articles 71 and 72 of the ICSID Convention; there are essentially three positions on this topic. Some consider that mutual consent to arbitrate has to be given prior to the denunciation of the Convention; otherwise, a dispute cannot fall within ICSID jurisdiction.

Others take an intermediate position, under which investors would be allowed to accept the consent given by a state in a BIT until the denunciation of the Convention becomes effective, that is to say, within the six-month period established in Article 71.

A less strict approach is adopted by those who argue that Article 72 encompasses all unilateral offers of consent contained in BITs, which remain in force even after the denunciation of the Convention. This would allow investors to commence ICSID proceedings even after the denunciation takes effect.

None of these pronouncements has been tested, although their correctness may be confirmed by an ICSID tribunal in a claim brought after Bolivia’s denunciation of the ICSID Convention had taken effect.

Some Venezuelan commentators have argued that Article 22 of the Venezuelan Foreign Investment Law constitutes an open consent by Venezuela to the jurisdiction of ICSID. However, this idea has been rejected by the Supreme Court and three ICSID panels as of the date of this publication.

In light of the current situation, foreign investors should examine carefully the alternatives to ICSID arbitration that their relevant BITs might offer, such as ICSID’s Additional Facilities or arbitration under the UNCITRAL Rules.

Award enforcement

Venezuelan courts seem to have no problem when it comes to enforcing awards rendered in domestic or international arbitrations to which both parties are private entities. However, there is some doubt with respect to the enforcement of an award adverse to the interests of the Venezuelan state.

Under the international conventions ratified by Venezuela, Venezuelan courts shall not enforce an award whenever it is contrary to Venezuelan public policy.

“Venezuelan courts seem to have no problem when it comes to enforcing awards rendered in domestic or international arbitrations to which both parties are private entities”

It has been suggested in certain Supreme Court decisions that any award by an international arbitral tribunal that negatively affects the Venezuelan state would be contrary to public policy. Under this reasoning it seems fairly unlikely, if not impossible, to obtain the enforcement of an arbitral award in which the tribunal has not sided with the Venezuelan government.

Ramon J Alvins and Elisabeth Eljura are partners and Gustavo Mata is an associate in the Caracas office of Norton Rose Canada LLP.

Revised ICC Rules of Arbitration

The International Chamber of Commerce’s revised Rules of Arbitration, which came into force on 1 January 2012, promise more cost-efficient and speedy resolution.

by Joe Tirado, Sherina Petit and Michelle Keen

The 2012 ICC rules clarify a number of issues and codify others not addressed in its 1998 rules. They are the result of lengthy consultations with arbitration practitioners and users and apply to all arbitrations commenced on or after 1 January 2012, unless the parties have agreed to submit their arbitration to the rules in effect on the date of their arbitration agreement (Article 6(1)). A number of material changes have been introduced, including updated provisions on multi-party and multi-contract arbitration, as well as mechanisms to create a faster, more efficient and transparent process:

Provisions to promote speed and cost-efficiency

  • Under the ICC’s 1998 rules, the ICC Court had to give a prima facie decision on the existence of an arbitration agreement (Article 6(2)). Now, the tribunal decides any question of jurisdiction, unless the Secretary General refers the matter to the ICC Court (Article 6(3)).
  • The ICC Court has increased powers to make direct appointments of arbitrators instead of acting on proposals by national committees, thus avoiding appointment delays (Article 13(3) and 13(4)).
  • The tribunal and the parties must “make every effort to conduct the arbitration in an expeditious and cost-effective manner” (Article 22(1)). Where a party fails to do so, the arbitral tribunal may now sanction that party when deciding costs (Article 37(5)).
  • To facilitate case management, the tribunal must convene a case management conference with the parties when drawing up the terms of reference, or as soon as possible after doing so (Article 24(1)). The tribunal is also empowered to adopt appropriate case management measures in consultation with the parties (Article 22(2)). Appendix IV of the new rules and the ICC’s Techniques for Controlling Time and Costs in Arbitration give examples of such measures.

Disputes involving multiple contracts and parties

Dispute resolution is becoming increasingly complex, frequently involving multiple parties and contracts. The 1998 rules did not adequately address this, and the clearer guidance provided in the new rules should be welcomed. Key provisions to note are:

  • Under Article 7, a party may join a third party to the arbitration (without the consent of any other party) simply by filing a request for joinder with the Secretariat, provided that this is done before any arbitrator is appointed or confirmed, unless the parties otherwise agree.
  • Article 8 provides that any party may make any type of claim or counterclaim against any other party to the arbitration prior to the approval of the terms of reference, after which additional claims or counterclaims require the tribunal’s authorisation.
  • claims arising out of or in connection with more than one contract may be made in a single arbitration, provided the arbitration agreements are compatible.
  • Article 10 broadens the more limited consolidation mechanism found in Article 4(6) of the 1998 rules. The ICC Court may now consolidate two or more arbitrations where the parties agree, all of the claims are made under the same arbitration agreement, or the parties are the same and the arbitration agreements are compatible.

Emergency arbitrator provisions

Where a party needs urgent interim or conservatory measures that cannot await the constitution of the arbitral tribunal, new provisions have been made for an “Emergency Arbitrator” to be appointed (Article 29 and Appendix V).

However, under Article 29(6), note that the emergency arbitrator provisions will not apply where:

  • the arbitration agreement was concluded before 1 January 2012
  • the parties have agreed to opt out of them
  • the parties have agreed to another pre-arbitral procedure that provides for granting conservatory, interim or similar measures (such as the ICC Pre- Arbitral Referee Procedure).

Note also that once an arbitral tribunal has been constituted, it is not bound by the emergency arbitrator’s order, which it may modify, terminate or annul (Article 29(3)). To commence the emergency procedure the claimant must pay US$40,000 on account for the fees of the ICC Court and emergency arbitrator.

General provisions


The tribunal now has express power to make orders concerning the confidentiality of the arbitration proceedings or of any other matters relating to the arbitration (Article 22(3)).

Only ICC Court authorised to administer arbitration under the 2012 ICC Rules

The ICC Court is now the only body authorised to administer arbitrations under the 2012 Rules (Article 1(2)).

Impartial and independent arbitrators

Concerns about a rise in challenges brought against arbitrators alleging lack of independence and impartiality have prompted a clarification and extension of arbitrators’ disclosure obligations when accepting appointments. Arbitrators must now be and remain “impartial and independent” and sign a “statement of acceptance” confirming this (Articles 11(1) and 11(2)).

Model arbitration clause

There is no amendment to the model ICC arbitration clause. However, the ICC has put forward alternative wording to be used where (for any reason) the parties prefer that the Emergency Arbitrator provisions should not apply. The new rules can be found at: International Chamber of Commerce

Joe Tirado is Head of International Arbitration and was chair to the ICC task force reviewing the ICC rules, Sherina Petit is Of Counsel and was secretary to the ICC’s UK task force reviewing at the ICC rules and Michelle Keen is an associate in the London office of Norton Rose LLP.

P.R.I.M.E. Finance – A new arbitration institution for complex financial product disputes

By Michael Godden, Yke Lennartz and Matt Waudby

P.R.I.M.E. Finance is a new ADR service for disputes concerning complex financial products (CFPs). Based in The Hague, it opened for business on 16 January 2012 and looks set to provide some extremely helpful resources.

P.R.I.M.E.’s purpose

P.R.I.M.E. Finance (the Panel of Recognised International Market Experts in Finance) seeks to address a number of perceived failings with dispute resolution mechanisms when it comes to CFP disputes. These include:

  • inconsistency in the way in which courts approach the meaning and effect of standardised market documentation in different jurisdictions.

For example, the English and New York courts have recently adopted different views on the meaning and effect of Section 2(a)(iii) of the ISDA Master Agreement. CFPs trade in a global marketplace and, in many cases, the same documentation (such as the ISDA Master Agreement) is used across the world. For that documentation to have different effects in different jurisdictions can create legal uncertainty and market inefficiency.

  • a perception that in some cases there is insufficient understanding of CFPs among judges, arbitrators and lawyers.

To some, CFPs (derivatives, structured notes and the like) are the ’rocket science’ end of the financial markets where innovation is rapid. There is concern that it may be unrealistic to expect generalist judges or arbitrators to have the understanding to properly resolve certain CFP disputes.

  • existing mechanisms can be too slow in resolving CFP disputes.

CFP markets can move very quickly; prices can change by the second. Here, justice delayed can be very much justice denied.

  • the difficulties in enforcing domestic court judgments in many foreign jurisdictions. This deficiency has gained significance as CFPs have become more widely traded with emerging market counterparties. In some circumstances this has tempered banks’ traditional preference for court based resolution in favour of arbitration (and thus the benefits of the New York Convention).

What P.R.I.M.E. offers

P.R.I.M.E. seeks to fulfil its aims by providing:

  • a new arbitral institution offering a panel of specialist arbitrators and new rules.

P.R.I.M.E.’s impressive panel, from which parties will select their arbitrators, seeks to provide both financial market and dispute resolution expertise.

Its current panel includes judges, central bankers, regulators, lawyers, academics and market participants.

In January 2012 P.R.I.M.E. published the first version of its rules, modelled on the UNCITRAL rules, with certain adjustments. For example:

  • they are institutionalised with P.R.I.M.E. as the arbitration institute. Generally, arbitrators are to be appointed from P.R.I.M.E.’s list only.
  • they provide for three types of expedited proceedings, including: (i) expedited proceedings leading to an award on the merits under which the parties may agree with the tribunal to shorten timelines; (ii) emergency proceedings to consider applications for interim measures; and (iii) referee arbitral proceedings (for which the place of arbitration must be in Holland).

P.R.I.M.E. hopes to achieve its objective of speed through these fast track mechanisms (as well as via the generally greater finality of arbitral awards compared to court judgments).

  • P.R.I.M.E.’s rules also provide that it may publish its awards anonymously, providing that the parties do not object within one month of receipt of the decision. This is to create greater consistency in decision making.

P.R.I.M.E. expects to revise its rules within a year to cover:

  • the provision of a mediation service and the ability to provide expert opinions.
  • the provision of education and outreach services.

This will include CFP training to jurists globally, an online database of all significant CFP judgments and law reform activities. This may prove valuable in emerging markets.

The future?

P.R.I.M.E. has lofty ambitions and laudable objectives. As a new institution, however, it will inevitably face significant challenges. The extent to which it is able to meet them will shape its ability to achieve its goals. These challenges may include:

  • striking the right balance in marrying finance expertise with dispute resolution experience.
  • ensuring that experts (many of whom are leading figures in their professions) are available and that P.R.I.M.E. tribunals can be rapidly constituted.
  • the extent to which it can resolve CFP disputes appropriately via the use of expedited proceedings, when sophisticated products are involved and parties are reluctant to agree to such procedures.
  • Achieving global consistency in the absence of a system of binding precedent, and when its tribunals will be required to apply the governing law chosen by the parties to each dispute (when different governing laws may adopt inconsistent approaches).
  • the degree to which parties (particularly losing parties) will be willing for P.R.I.M.E. to publish its awards.

These challenges notwithstanding P.R.I.M.E. is an exciting development which should help those involved in CFP disputes.

Michael Godden is a partner and Matt Waudby is Of Counsel in the London office and Yke Lennartz is a partner in the Amsterdam office of Norton Rose LLP.



In the 2012 editions of Chambers Asia-Pacific and Chambers Global, two of the leading international legal services directories, we are ranked as top tier for “Dispute Resolution (International Firms): India” and Dispute Resolution: India – Experts Based Abroad respectively. This follows our recent ranking by the Global Arbitration Review as one of the world’s top 20 law firms.

Bahrain Dispute Resolution Law Firm of the Year

Our Bahrain office was awarded Bahrain Dispute Resolution Law Firm of the Year by Acquisition International magazine in October.

Launch of the new ICC Rules

We hosted the UK launch of the revised ICC Rules of Arbitration at our London office in November. The event was very well received with over 100 attendees.

Arbitration roundtable event in Dubai

In October, our Dubai office hosted an arbitration roundtable event for key clients to coincide with the annual conference in Dubai.

The event focused on global trends in international arbitration. At the annual IBA conference, Pierre Bienvenu, Joe Tirado and Martin Valasek presented papers.

Russia as a Place for Arbitration: Pros and Cons – ICC Russia

In December we co-sponsored the International Chamber of Commerce’s conference in Russia: Russia as a Place for Arbitration: Pros and Cons. Moscow partner Yaroslav Klimov gave a presentation on the arbitrability of corporate disputes.

International Bar Association

Montréal partner Stephen Drymer has been appointed to the executive of the IBA Arbitration Committee and as editor of the IBA Arbitration News. Joe Tirado in London has been appointed as Secretary to the Mediation Committee.

ICC conference in Prague

Martin Valasek moderated a panel discussion on party autonomy vs authority of the arbitral tribunal at this conference in October. He was also co-Chair and moderator at the Young ICC conference in Prague.


Pierre Bienvenu, Norton Rose Canada LLP
Global practice leader – international arbitration
Tel +1 514 847 4452

Joe Tirado, Norton Rose LLP
Head of international arbitration
Tel +44 (0)20 7444 2433


Norton Rose Australia

Rob Buchanan

Ernest van Buuren


Norton Rose (Middle East) LLP

Adam Vause


Norton Rose LLP

Michael Jürgen Werner


Norton Rose OR LLP

Stephen L. Drymer

Martin J. Valasek


Norton Rose LLP

Jim James


Norton Rose Colombia S.A.S.

Ramon Alvins

Czech Republic

Norton Rose v.o.s., advokátni kancelář

Pavlína Beránková


Norton Rose LLP

Barthélemy Cousin


Norton Rose LLP

Patricia Nacimiento


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Marie Kelly

Hong Kong

Norton Rose Hong Kong

Camille Jojo


Norton Rose Studio Legale

Cecilia Buresti


Norton Rose (Kazakhstan) Limited

Yerzhan Kumerov


Norton Rose LLP

Yke Lennartz


Norton Rose Piotr Strawa and Partners LP

Malgorzata Patocka-Zbikowska


Norton Rose (Central Europe) LLP

Yaroslav Klimov


Norton Rose (Asia) LLP

Guy Spooner

South Africa

Norton Rose South Africa (incorporated
as Deneys Reitz Inc.)

Michael Hart


Norton Rose (Thailand) Limited

Somboon Kitiyansub


Norton Rose (Middle East) LLP

Patrick Bourke

United Kingdom

Norton Rose LLP

Joe Tirado


Despacho de Abogados miembros de Norton Rose, S.C.

Ramon Alvins

Focus on Latin America

Ramón J Alvins is the managing partner of our Caracas office. He has participated in arbitration procedures both in Venezuela and abroad. He served as a judge pro tem of the Commercial and Civil Court of Justice in First Instance of the judicial district of the Caracas Metropolitan area between 1999 and 2002. With a strong background in insurance litigation, Ramón specialises in litigation and arbitration. He also has vast experience in corporate and civil law relating to real estate and family law and in commercial and civil law as well as labour and administrative law.

Elisabeth Eljuri is one of Latin America’s leading energy practitioners, who does both transactional as well as dispute work. She has been counsel in a number of major international arbitrations related to Latin America, and mainly Venezuela. She has also been independent expert in multiple international proceedings and is listed as arbitrator in the local chapter of the ICC in Venezuela (the CCCAC) and CEDCA, the two leading arbitration centers. An interview with Elisabeth follows.

I am a lawyer because...

I was fascinated by the law (my grandfather was a lawyer) and was too young to know better when I chose what to do with the rest of my life.

What gives you greatest satisfaction, professionally?

Winning a major new client file which is challenging and rewarding.

And personally?

Watching my young children, Nicolas and Emma, growing healthy and happy.

How do you spend the weekends?

Planning activities for my children when I am not travelling. Golfing when I can as well (we have good weather year-round).

If you weren’t a lawyer, what would you be doing?

I would be involved in a career in public service (in the right country, at the right time).

What’s on your iPod?

About 8000 songs, a lot of them Latin or in Spanish as well, and my kids favourite movies.

What is your biggest vice?