Originally from World Arbitration And Mediation Review (WAMR)

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THE BATTLE BETWEEN COUNTRIES

AND CORPORATIONS CONTINUES
AND ARGENTINA FALLS AGAIN:
VIVENDI V. ARGENTINA

The dispute in Compañía De Aguas Del Aconquija S.A. and Vivendi
Universal S.A. v. Argentine Republic originally stemmed from the bilateral
investment treaty (BIT) between the Argentine Republic and the French
Republic. On August 29, 2003, Vivendi Universal S.A. (Vivendi) and
Compañía de Aguas del Aconquija (CAA) re-submitted its dispute to the
International Centre for Settlement of Investment Disputes (ICSID) after an
ICSID annulment committee annulled, in part, the Vivendi Award in the
first instance. The claimants aver that they were denied fair and equitable
treatment in connection with a Concession Agreement to provide water and
sewage services to the province of Tucumán in Argentina, and that their
investment was expropriated without just compensation. Vivendi and CAA
claimed that the Argentine Republic was “internationally responsible” for
the acts of the Tucumán authorities and that Argentina “therefore violated
the claimant’s rights under Articles 3 and 5 of the BIT” between France and
Argentina.1

I. BRIEF SUMMARY
Vivendi and CAA brought a claim alleging mistreatment of the French
company by the authorities in the Argentine province of Tucumán. The
claimants argued that soon after taking control of the water and sewage
services, they were “systematically attacked and deprived” of their rights
under the France/Argentina BIT.2 Vivendi and CAA also claimed that the
government used the media and the public stage to create hostility against
them. In addition, claimants alleged that the government forced the
claimants to renegotiate the Concession Agreement and secretly undermined
proposals that could have “ended the crisis and saved the concession from
disaster.”3 These alleged actions eventually led to the termination of the
Concession Agreement. The claimants alleged that they were held
“hostage,” and required to continue service for another ten months. The
claimants argued that these actions violated the fair and equitable standard
under Articles 3 and 5 of the BIT and that Argentina also expropriated the