1016-00002 · Dunmore Energy Holdings · Arbitration Pleadings

dormancy-renewal-letter-icsid-june-2024.docx DOCUMENT Litigation

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June 12, 2024

By email and courier

Calderwood & Harkness LLP 55 Bishopsgate London EC2N 3AH United Kingdom

Harcastle Fenton LLP 12 Essex Street London WC2R 3AA United Kingdom

The Secretary-General International Centre for Settlement of Investment Disputes (ICSID) 1818 H Street, N.W. Washington, D.C. 20433 United States of America

Re: ICSID Case No. ARB/22/11 — *Dunmore Energy Holdings Ltd. v. Republic of Valderia* — Joint Request for Continuation of Suspension of Proceedings (Fourth Renewal)

Dear Madam Secretary-General,

1. Introduction

The undersigned counsel write jointly on behalf of the Claimant, Dunmore Energy Holdings Ltd. ("DEH"), a Cayman Islands exempted company with its principal administrative offices in London, and the Respondent, the Republic of Valderia, respectively. Calderwood & Harkness LLP acts as lead international counsel for DEH, and Harcastle Fenton LLP acts as lead international counsel for the Republic of Valderia, in the above-referenced proceedings.

This letter concerns ICSID Case No. ARB/22/11, which was registered by the Secretary-General on April 8, 2022, following the filing of DEH's Request for Arbitration on March 15, 2022. The proceedings were initiated pursuant to Article 36 of the Convention on the Settlement of Investment Disputes between States and Nationals of Other States, opened for signature on March 18, 1965, and entered into force on October 14, 1966 (the "ICSID Convention").

The purpose of this joint letter is to respectfully request a further continuation of the suspension of proceedings in ICSID Case No. ARB/22/11, in accordance with the parties' mutual agreement, for the reasons set out below. This request constitutes the fourth renewal of the suspension originally granted in June 2022.

2. Procedural History of Suspension Requests

By way of background, the parties wish to place on record the procedural history of the suspension of proceedings in this case, so as to provide the Secretary-General and the ICSID Secretariat with a complete and consolidated account of the prior joint requests and the corresponding confirmations received.

On June 17, 2022, approximately two months following registration of the case, the parties submitted a joint letter to the Secretary-General requesting the suspension of proceedings in ICSID Case No. ARB/22/11. That initial request was made on the basis that state-to-state diplomatic consultations between the United Kingdom of Great Britain and Northern Ireland and the Republic of Valderia had been initiated with respect to the investment dispute underlying the arbitration, and that the parties considered it appropriate and in the interests of procedural economy to hold the arbitral proceedings in abeyance pending the outcome of those consultations. The Secretary-General duly granted the initial request for suspension.

Since that time, the parties have jointly sought, and the Secretary-General has granted, three successive renewals of the suspension, as follows:

(a) First Renewal: By joint letter dated December 15, 2022, the parties requested the continuation of the suspension of proceedings. The Secretary-General confirmed the continuation of the suspension.

(b) Second Renewal: By joint letter dated June 14, 2023, the parties requested a further continuation of the suspension of proceedings. The Secretary-General confirmed the continuation of the suspension.

(c) Third Renewal: By joint letter dated December 13, 2023, the parties requested yet a further continuation of the suspension of proceedings. The Secretary-General confirmed the continuation of the suspension.

This present joint letter constitutes the parties' fourth request for renewal of the suspension of proceedings. Each of the prior renewal requests has been submitted on a jointly agreed basis and has been granted by the Secretary-General without objection. The parties are grateful to the Secretary-General and the ICSID Secretariat for their continued accommodation of the parties' joint position regarding the suspension.

3. Basis for Continued Suspension — Ongoing Diplomatic Consultations

The parties confirm that the state-to-state diplomatic consultations that formed the basis for the original request for suspension, and for each subsequent renewal thereof, remain ongoing as of the date of this letter.

Specifically, consultations between the United Kingdom Foreign, Commonwealth & Development Office ("FCDO") and the Ministry of Foreign Affairs of the Republic of Valderia, conducted under the authority of His Excellency Ambassador Diego Fuentes Castillo, continue to take place at regular intervals. These diplomatic consultations were initiated in early 2022, prior to the filing of the Request for Arbitration, and have continued without interruption throughout the period during which the proceedings have been suspended.

The diplomatic consultations arise from, and are directed at, the investment dispute concerning the expropriation by the Republic of Valderia of Concession No. HYD-2012-047 (Bloque Orinoco Sur) in the Valderian Orinoco Basin. Concession No. HYD-2012-047 was originally awarded to DEH's wholly owned Valderian subsidiary pursuant to a competitive tender process administered by the Valderian Ministry of Energy and Natural Resources. The expropriation of the concession, and the measures alleged to give rise to it, form the core subject matter of the claims advanced by DEH in ICSID Case No. ARB/22/11.

The dispute arises under the Agreement Between the Government of the United Kingdom of Great Britain and Northern Ireland and the Government of the Republic of Valderia for the Promotion and Protection of Investments, which was signed on May 22, 2006, and entered into force on November 1, 2006 (the "UK-Valderia BIT"). The Claimant's claims in this arbitration are brought under, inter alia, Articles 2, 3, 4, 5, and 8 of the UK-Valderia BIT, and the diplomatic consultations between the two Contracting States address issues of treaty interpretation and application that are directly relevant to the matters in dispute.

Both parties have been informed by their respective governments that the diplomatic consultations have continued to progress in a constructive manner, and that the participating officials on both sides remain engaged in substantive dialogue regarding the investment dispute and the broader questions of treaty compliance and investor protection that it raises. While the parties are not in a position to disclose the specific details of the diplomatic discussions — which are conducted on a confidential, government-to-government basis — they are satisfied that meaningful engagement continues and that the consultations have not reached an impasse.

In the considered view of both parties, a continuation of the suspension of proceedings remains appropriate and conducive to the possibility of a diplomatic resolution of the dispute, or, at a minimum, a narrowing of the issues that would need to be addressed in any future arbitral proceedings. The parties further believe that the reactivation of the arbitral proceedings at this time would not serve the interests of procedural economy, would generate unnecessary costs and burdens for the parties and for the Centre, and would risk interfering with the ongoing diplomatic efforts aimed at achieving an amicable settlement. The parties are mindful that the ICSID Convention and the ICSID system encourage the resolution of investment disputes through negotiation and settlement where possible, and the continued suspension is consistent with that objective.

4. Status of Tribunal Constitution

The parties wish to confirm that the Tribunal in ICSID Case No. ARB/22/11 has not yet been constituted. At the time the proceedings were suspended in June 2022, the constitution of the Tribunal was at an early stage. Specifically:

(a) The Claimant had nominated Professor Ingrid Svensson, a Swedish national and Professor of International Investment Law at the University of Uppsala, as its party-appointed arbitrator, in accordance with Article 37(2)(b) of the ICSID Convention.

(b) The Respondent had not yet nominated an arbitrator, in light of the suspension of proceedings that had been agreed between the parties and confirmed by the Secretary-General in June 2022.

(c) No presiding arbitrator has been appointed, and no steps have been taken toward the selection of a presiding arbitrator.

The parties acknowledge and understand that the constitution of the Tribunal remains in abeyance during the period of the suspension, and that no steps toward constitution are expected or required to be taken during the suspension period. In the event that the proceedings are reactivated, the parties anticipate that the Respondent will proceed to nominate its party-appointed arbitrator, and that the parties will thereafter agree upon or seek the appointment of a presiding arbitrator, in accordance with the applicable provisions of the ICSID Convention and the ICSID Arbitration Rules.

5. Joint Consent and Reservation of Rights

Both parties hereby confirm their joint and mutual consent to the continuation of the suspension of proceedings in ICSID Case No. ARB/22/11. This consent is freely given and reflects the considered judgment of each party, in consultation with its respective counsel, that the continued suspension is in the best interests of both parties and of the efficient administration of the proceedings.

At the same time, and for the avoidance of any doubt, each party expressly reserves all of its rights, claims, defenses, arguments, and entitlements under the ICSID Convention, the UK-Valderia BIT, applicable rules and principles of international law (including customary international law), and the ICSID Arbitration Rules, without prejudice and without limitation. This reservation of rights includes, but is not limited to, each party's right to raise any jurisdictional objection, to advance any claim or counterclaim, to assert any defense (whether procedural or substantive), and to rely on any evidence or legal authority, in any future proceedings in this case or otherwise.

Neither party waives, nor shall be deemed to have waived, any right, procedural or substantive, by reason of its agreement to this suspension or to any prior suspension of proceedings. The parties further confirm that no inference adverse to either party shall be drawn from the fact of the suspension, from the duration of the suspension, or from any party's conduct during the suspension period, including with respect to the ongoing diplomatic consultations.

6. Proposed Next Review Date

The parties jointly propose that the next review date for the suspension of proceedings be set for December 12, 2024, which is approximately six months from the date of this letter and consistent with the approximately six-month review intervals that have been observed in each of the prior renewal cycles.

The parties undertake that, at or before the proposed next review date of December 12, 2024, they will take one of the following steps:

(a) submit a further joint request for continuation of the suspension of proceedings, in the event that the diplomatic consultations remain ongoing and the parties jointly consider a further suspension to be appropriate;

(b) notify the Secretary-General of an agreement between the parties to reactivate the proceedings in ICSID Case No. ARB/22/11, and provide any necessary information regarding the resumption of the constitution of the Tribunal and the establishment of a procedural timetable; or

(c) provide such other notification as may be appropriate regarding the status of the case, including, without limitation, notification of a settlement, a discontinuance, or any other development material to the administration of the proceedings.

The parties are committed to keeping the Secretary-General and the ICSID Secretariat informed of any material developments between now and the proposed next review date, and will not hesitate to write to the Secretary-General on an ad hoc basis should circumstances so require.

7. Request for Confirmation

In light of the foregoing, the parties respectfully request that the Secretary-General confirm receipt of this joint letter and the continuation of the suspension of proceedings in ICSID Case No. ARB/22/11 through the proposed next review date of December 12, 2024, or such other date as the Secretary-General may consider appropriate.

The parties remain available at the Secretary-General's convenience to provide any further information, clarification, or documentation that the ICSID Secretariat may require in connection with this request or with the administration of the case more generally. Communications may be directed to either or both of the undersigned counsel at the addresses indicated below.

8. Closing

The parties wish to express their sincere respect and gratitude to the Secretary-General and to the staff of the ICSID Secretariat for their continued patience, professionalism, and accommodation in connection with the administration of this matter. The parties are mindful of the administrative burden that repeated suspension requests may place upon the Secretariat, and they appreciate the Centre's facilitation of the parties' efforts to explore a diplomatic resolution of the dispute.

We remain, Madam Secretary-General, with the highest esteem and respect,

Respectfully submitted,

For and on behalf of the Claimant, Dunmore Energy Holdings Ltd.

________________________________________

Vivienne St. Claire Partner Calderwood & Harkness LLP 55 Bishopsgate London EC2N 3AH United Kingdom Tel: +44 (0)20 7946 0123

Email: v.stclaire@calderwoodharkness.com

For and on behalf of the Respondent, the Republic of Valderia

________________________________________

Charles Winterbottom QC Partner Harcastle Fenton LLP 12 Essex Street London WC2R 3AA United Kingdom Tel: +44 (0)20 7420 8800

Email: c.winterbottom@harcastlefenton.com

cc:

Priya Nandakumar, Chief Executive Officer, Dunmore Energy Holdings Ltd., 27 Curzon Street, London W1J 5HT, United Kingdom

Dr. Renata Villamizar Ochoa, Attorney General, Republic of Valderia

Dr. Alejandro Bernal Quiroga, Ortega & Bernal, Abogados, Avenida de la Constitución 310, Edificio República, Puerto Valdés, Valderia (Respondent's local counsel)

Dr. Gabriel Castaño Herrera, Castaño Herrera & Asociados, Calle Bolívar 742, Torre Empresarial, Piso 8, Puerto Valdés, Valderia (Claimant's local Valderian counsel)

June 12, 2024
By email and courier
Calderwood & Harkness LLP 55 Bishopsgate London EC2N 3AH United Kingdom
Harcastle Fenton LLP 12 Essex Street London WC2R 3AA United Kingdom
The Secretary-General International Centre for Settlement of Investment Disputes (ICSID) 1818 H Street, N.W. Washington, D.C. 20433 United States of America
Re: ICSID Case No. ARB/22/11 — *Dunmore Energy Holdings Ltd. v. Republic of Valderia* — Joint Request for Continuation of Suspension of Proceedings (Fourth Renewal)
Dear Madam Secretary-General,
1. Introduction
The undersigned counsel write jointly on behalf of the Claimant, Dunmore Energy Holdings Ltd. ("DEH"), a Cayman Islands exempted company with its principal administrative offices in London, and the Respondent, the Republic of Valderia, respectively. Calderwood & Harkness LLP acts as lead international counsel for DEH, and Harcastle Fenton LLP acts as lead international counsel for the Republic of Valderia, in the above-referenced proceedings.
This letter concerns ICSID Case No. ARB/22/11, which was registered by the Secretary-General on April 8, 2022, following the filing of DEH's Request for Arbitration on March 15, 2022. The proceedings were initiated pursuant to Article 36 of the Convention on the Settlement of Investment Disputes between States and Nationals of Other States, opened for signature on March 18, 1965, and entered into force on October 14, 1966 (the "ICSID Convention").
The purpose of this joint letter is to respectfully request a further continuation of the suspension of proceedings in ICSID Case No. ARB/22/11, in accordance with the parties' mutual agreement, for the reasons set out below. This request constitutes the fourth renewal of the suspension originally granted in June 2022.
2. Procedural History of Suspension Requests
By way of background, the parties wish to place on record the procedural history of the suspension of proceedings in this case, so as to provide the Secretary-General and the ICSID Secretariat with a complete and consolidated account of the prior joint requests and the corresponding confirmations received.
On June 17, 2022, approximately two months following registration of the case, the parties submitted a joint letter to the Secretary-General requesting the suspension of proceedings in ICSID Case No. ARB/22/11. That initial request was made on the basis that state-to-state diplomatic consultations between the United Kingdom of Great Britain and Northern Ireland and the Republic of Valderia had been initiated with respect to the investment dispute underlying the arbitration, and that the parties considered it appropriate and in the interests of procedural economy to hold the arbitral proceedings in abeyance pending the outcome of those consultations. The Secretary-General duly granted the initial request for suspension.
Since that time, the parties have jointly sought, and the Secretary-General has granted, three successive renewals of the suspension, as follows:
(a) First Renewal: By joint letter dated December 15, 2022, the parties requested the continuation of the suspension of proceedings. The Secretary-General confirmed the continuation of the suspension.
(b) Second Renewal: By joint letter dated June 14, 2023, the parties requested a further continuation of the suspension of proceedings. The Secretary-General confirmed the continuation of the suspension.
(c) Third Renewal: By joint letter dated December 13, 2023, the parties requested yet a further continuation of the suspension of proceedings. The Secretary-General confirmed the continuation of the suspension.
This present joint letter constitutes the parties' fourth request for renewal of the suspension of proceedings. Each of the prior renewal requests has been submitted on a jointly agreed basis and has been granted by the Secretary-General without objection. The parties are grateful to the Secretary-General and the ICSID Secretariat for their continued accommodation of the parties' joint position regarding the suspension.
3. Basis for Continued Suspension — Ongoing Diplomatic Consultations
The parties confirm that the state-to-state diplomatic consultations that formed the basis for the original request for suspension, and for each subsequent renewal thereof, remain ongoing as of the date of this letter.
Specifically, consultations between the United Kingdom Foreign, Commonwealth & Development Office ("FCDO") and the Ministry of Foreign Affairs of the Republic of Valderia, conducted under the authority of His Excellency Ambassador Diego Fuentes Castillo, continue to take place at regular intervals. These diplomatic consultations were initiated in early 2022, prior to the filing of the Request for Arbitration, and have continued without interruption throughout the period during which the proceedings have been suspended.
The diplomatic consultations arise from, and are directed at, the investment dispute concerning the expropriation by the Republic of Valderia of Concession No. HYD-2012-047 (Bloque Orinoco Sur) in the Valderian Orinoco Basin. Concession No. HYD-2012-047 was originally awarded to DEH's wholly owned Valderian subsidiary pursuant to a competitive tender process administered by the Valderian Ministry of Energy and Natural Resources. The expropriation of the concession, and the measures alleged to give rise to it, form the core subject matter of the claims advanced by DEH in ICSID Case No. ARB/22/11.
The dispute arises under the Agreement Between the Government of the United Kingdom of Great Britain and Northern Ireland and the Government of the Republic of Valderia for the Promotion and Protection of Investments, which was signed on May 22, 2006, and entered into force on November 1, 2006 (the "UK-Valderia BIT"). The Claimant's claims in this arbitration are brought under, inter alia, Articles 2, 3, 4, 5, and 8 of the UK-Valderia BIT, and the diplomatic consultations between the two Contracting States address issues of treaty interpretation and application that are directly relevant to the matters in dispute.
Both parties have been informed by their respective governments that the diplomatic consultations have continued to progress in a constructive manner, and that the participating officials on both sides remain engaged in substantive dialogue regarding the investment dispute and the broader questions of treaty compliance and investor protection that it raises. While the parties are not in a position to disclose the specific details of the diplomatic discussions — which are conducted on a confidential, government-to-government basis — they are satisfied that meaningful engagement continues and that the consultations have not reached an impasse.
In the considered view of both parties, a continuation of the suspension of proceedings remains appropriate and conducive to the possibility of a diplomatic resolution of the dispute, or, at a minimum, a narrowing of the issues that would need to be addressed in any future arbitral proceedings. The parties further believe that the reactivation of the arbitral proceedings at this time would not serve the interests of procedural economy, would generate unnecessary costs and burdens for the parties and for the Centre, and would risk interfering with the ongoing diplomatic efforts aimed at achieving an amicable settlement. The parties are mindful that the ICSID Convention and the ICSID system encourage the resolution of investment disputes through negotiation and settlement where possible, and the continued suspension is consistent with that objective.
4. Status of Tribunal Constitution
The parties wish to confirm that the Tribunal in ICSID Case No. ARB/22/11 has not yet been constituted. At the time the proceedings were suspended in June 2022, the constitution of the Tribunal was at an early stage. Specifically:
(a) The Claimant had nominated Professor Ingrid Svensson, a Swedish national and Professor of International Investment Law at the University of Uppsala, as its party-appointed arbitrator, in accordance with Article 37(2)(b) of the ICSID Convention.
(b) The Respondent had not yet nominated an arbitrator, in light of the suspension of proceedings that had been agreed between the parties and confirmed by the Secretary-General in June 2022.
(c) No presiding arbitrator has been appointed, and no steps have been taken toward the selection of a presiding arbitrator.
The parties acknowledge and understand that the constitution of the Tribunal remains in abeyance during the period of the suspension, and that no steps toward constitution are expected or required to be taken during the suspension period. In the event that the proceedings are reactivated, the parties anticipate that the Respondent will proceed to nominate its party-appointed arbitrator, and that the parties will thereafter agree upon or seek the appointment of a presiding arbitrator, in accordance with the applicable provisions of the ICSID Convention and the ICSID Arbitration Rules.
5. Joint Consent and Reservation of Rights
Both parties hereby confirm their joint and mutual consent to the continuation of the suspension of proceedings in ICSID Case No. ARB/22/11. This consent is freely given and reflects the considered judgment of each party, in consultation with its respective counsel, that the continued suspension is in the best interests of both parties and of the efficient administration of the proceedings.
At the same time, and for the avoidance of any doubt, each party expressly reserves all of its rights, claims, defenses, arguments, and entitlements under the ICSID Convention, the UK-Valderia BIT, applicable rules and principles of international law (including customary international law), and the ICSID Arbitration Rules, without prejudice and without limitation. This reservation of rights includes, but is not limited to, each party's right to raise any jurisdictional objection, to advance any claim or counterclaim, to assert any defense (whether procedural or substantive), and to rely on any evidence or legal authority, in any future proceedings in this case or otherwise.
Neither party waives, nor shall be deemed to have waived, any right, procedural or substantive, by reason of its agreement to this suspension or to any prior suspension of proceedings. The parties further confirm that no inference adverse to either party shall be drawn from the fact of the suspension, from the duration of the suspension, or from any party's conduct during the suspension period, including with respect to the ongoing diplomatic consultations.
6. Proposed Next Review Date
The parties jointly propose that the next review date for the suspension of proceedings be set for December 12, 2024, which is approximately six months from the date of this letter and consistent with the approximately six-month review intervals that have been observed in each of the prior renewal cycles.
The parties undertake that, at or before the proposed next review date of December 12, 2024, they will take one of the following steps:
(a) submit a further joint request for continuation of the suspension of proceedings, in the event that the diplomatic consultations remain ongoing and the parties jointly consider a further suspension to be appropriate;
(b) notify the Secretary-General of an agreement between the parties to reactivate the proceedings in ICSID Case No. ARB/22/11, and provide any necessary information regarding the resumption of the constitution of the Tribunal and the establishment of a procedural timetable; or
(c) provide such other notification as may be appropriate regarding the status of the case, including, without limitation, notification of a settlement, a discontinuance, or any other development material to the administration of the proceedings.
The parties are committed to keeping the Secretary-General and the ICSID Secretariat informed of any material developments between now and the proposed next review date, and will not hesitate to write to the Secretary-General on an ad hoc basis should circumstances so require.
7. Request for Confirmation
In light of the foregoing, the parties respectfully request that the Secretary-General confirm receipt of this joint letter and the continuation of the suspension of proceedings in ICSID Case No. ARB/22/11 through the proposed next review date of December 12, 2024, or such other date as the Secretary-General may consider appropriate.
The parties remain available at the Secretary-General's convenience to provide any further information, clarification, or documentation that the ICSID Secretariat may require in connection with this request or with the administration of the case more generally. Communications may be directed to either or both of the undersigned counsel at the addresses indicated below.
8. Closing
The parties wish to express their sincere respect and gratitude to the Secretary-General and to the staff of the ICSID Secretariat for their continued patience, professionalism, and accommodation in connection with the administration of this matter. The parties are mindful of the administrative burden that repeated suspension requests may place upon the Secretariat, and they appreciate the Centre's facilitation of the parties' efforts to explore a diplomatic resolution of the dispute.
We remain, Madam Secretary-General, with the highest esteem and respect,
Respectfully submitted,
For and on behalf of the Claimant, Dunmore Energy Holdings Ltd.
________________________________________
Vivienne St. Claire Partner Calderwood & Harkness LLP 55 Bishopsgate London EC2N 3AH United Kingdom Tel: +44 (0)20 7946 0123
Email: v.stclaire@calderwoodharkness.com
For and on behalf of the Respondent, the Republic of Valderia
________________________________________
Charles Winterbottom QC Partner Harcastle Fenton LLP 12 Essex Street London WC2R 3AA United Kingdom Tel: +44 (0)20 7420 8800
Email: c.winterbottom@harcastlefenton.com
cc:
Priya Nandakumar, Chief Executive Officer, Dunmore Energy Holdings Ltd., 27 Curzon Street, London W1J 5HT, United Kingdom
Dr. Renata Villamizar Ochoa, Attorney General, Republic of Valderia
Dr. Alejandro Bernal Quiroga, Ortega & Bernal, Abogados, Avenida de la Constitución 310, Edificio República, Puerto Valdés, Valderia (Respondent's local counsel)
Dr. Gabriel Castaño Herrera, Castaño Herrera & Asociados, Calle Bolívar 742, Torre Empresarial, Piso 8, Puerto Valdés, Valderia (Claimant's local Valderian counsel)

June 12, 2024

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