Originally from the Journal of Damages in International Arbitration

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The Parties
UAB E Energia (Lithuania) (the “Claimant”), Republic of Latvia (the “Respondent”)

Sector
Public services; operation of a district heating system

Applicable Treaty
Bilateral Investment Treaty between Lithuania and Latvia

Members of the Tribunal
Paolo Michele Patocchi (President), Samuel Wordsworth (Claimant’s appointee), and August Reinisch (appointed by ICSID for Latvia)

I.  BACKGROUND

The dispute centred around Latvia’s termination of a 30-year lease agreement entered into between UAB and local energy regulator, AS Rēzeknes Siltumtiki (the “Regulator”), a company wholly owned by the Rēzekne municipality (the “Municipality”).