The Right of Investor to Arbitrate: Can Domestic Laws provide for its Extinguishing in case of Annulment of its relative Award? A Commentary on the ATA v. Jordan ICSID Award of May 18, 2010 (Case Arb/08/2) (in Arabic)

Majallat Attahkim Al Alamiya [World Journal of Arbitration], Vol. 2, Issue 8, October 2010, pp. 543-557.

15 Pages Posted: 31 Jul 2011 Last revised: 2 Mar 2013

See all articles by Nader M. Ibrahim

Nader M. Ibrahim

Qatar University - College of Law

Date Written: May 1, 2010

Abstract

This is a commentary on an ICISD award, issued in favor of a Turkish Company against Jordan on May 18, 2010. The award relates to a FIDIC contract between a Turkish Company (ATA) and a Jordanian Company (APC) to build a dike. At time of contracting in 1998, APC was owned and controlled by Jordan. Due to reasons beyond ATA’s obligations, a section of the dike collapsed, APC consequently activated the FIDIC arbitration, however in 2003, the APC’s claim was dismissed and the ATA’s counter-claim was instead accepted, leading to an award in favor of ATA.

In 2006, the Jordanian Court of Appeal vacated the 2003 FIDIC award, a decision that was confirmed by Jordan’s Court of Cassation in 2007. And, the FIDIC arbitration clause was judicially declared extinguished in application of Article 51, of the Jordanian Arbitration Act No. 31 of 2001, leading to new Jordanian court proceedings, a result that ATA claimed being in violation of international law (namely, the Turkey-Jordan Bilateral Investment Treaty, i.e., the ‘BIT’, and the 1958 New York Convention).

In 2008, ATA claimed being an investor entitled to resort to ICSID against Jordan, based on the BIT. Jordan objected to the jurisdiction of the ICSID Tribunal, for the claim does not fall in the ‘temporal scope’ of the BIT, and which came to effect in 2006, after formation of the FIDIC contract and its disputes, in addition to non-breach of the BIT.

The ICSID tribunal held in 2008 that some of the aspects of the ATA claim falls in the temporal scope of the Turkey-Jordan BIT, namely the investor’s ‘right to arbitrate’, and ruled against Jordan, for its courts applying a provision of law (extinguishing arbitration clause in case of vacated awards) in violation of international law. The commentator analyzes both aspects, and highlights the risk that some Arab countries run when they adopt domestic arbitration laws that deviate from international standards of arbitration.

Note: This commentary does not cover the subsequent ICSID decision on Interpretation and on the Request for Provisional Measures, related to the same case, issued on March 7, 2011.

Keywords: Arbitration clause, vacated award, Turkey-Jordan BIT, temporal application of BIT, ICISD

Suggested Citation

Ibrahim, Nader Mohamed, The Right of Investor to Arbitrate: Can Domestic Laws provide for its Extinguishing in case of Annulment of its relative Award? A Commentary on the ATA v. Jordan ICSID Award of May 18, 2010 (Case Arb/08/2) (in Arabic) (May 1, 2010). Majallat Attahkim Al Alamiya [World Journal of Arbitration], Vol. 2, Issue 8, October 2010, pp. 543-557., Available at SSRN: https://ssrn.com/abstract=1898668

Nader Mohamed Ibrahim (Contact Author)

Qatar University - College of Law ( email )

Doha, 2713
Qatar
+974 3033 1967 (Phone)
+974 4403 5253 (Fax)

HOME PAGE: http://www.qu.edu.qa/

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