Originally from Journal of Damages in International Arbitration

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I.  INTRODUCTION

On December 8, 2016, an arbitral tribunal composed of Professor Andreas Bucher (President), Professor Pedro J. Martinez-Fraga, and Professor Campbell McLachlan QC issued an award in ICSID Case No. ARB/07/26, Urbaser S.A. and Consorcio de Aguas Bilbao Bizkaia, Bilbao Biskaia Ur Partzuergoa v. The Argentine Republic.  The Tribunal awarded a declaration that the Argentine Republic had breached Article IV(1) of the BIT in not affording fair and equitable treatment to the Claimants. However, the Tribunal dismissed all of the Claimant’s other claims for breaches of the BIT as well as the Claimants’ claim for damages. With respect to the Respondent’s Counterclaim alleging that the Claimants had violated their obligations under international law to the human right to water by failing to invest in the concession, the Tribunal found that it had jurisdiction to determine the Counterclaim. However, the Tribunal dismissed the Counterclaim on its merits.

II.  FACTUAL BACKGROUND

Claimants Urbaser S.A. (“Urbaser”) and Consorcio de Aguas Bilbao Bizkaia, Bilbao Biskaia Ur Partzuergoa (“CABB”) were Spanish shareholders in Aguas Del Gran Buenos Aires S.A. (“AGBA”), the concessionaire for water and sewerage services to be provided in the Province of Greater Buenos Aires.

In early 2000 by way of a concession agreement (the “Concession Contract”), the concession was granted to AGBA. The work to be achieved under the Concession Contract included recovering payment from illegal users of the water and sewage network, reconditioning the existing network to allow for the provision of services to those parts of the population who were equipped or located to non-working connections and to expand the network into districts where no service was available because of the lack of any equipment.