Originally from the Journal of Damages in International Arbitration

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The Parties
Koch Mineral SÁRL (“KOMSA”) and Koch Nitrogen International SÁRL (“KNI”) (the “Claimants”), the Bolivarian Republic of Venezuela (the “Respondent”)

Sector
Ammonia and urea production

Applicable Treaty
Bilateral Investment Treaty between the Swiss Confederation and the Republic of Venezuela

Members of the Tribunal
V. V. Veeder (President), Hon. Marc Lalonde (Claimants’ appointee), and Zachary Douglas (Respondent’s appointee)

I.  BACKGROUND

In 1998, Claimants, together with Pequiven International Petrochemical Sales Limited (“Pequiven”), Snamprogettu Netherlands BV and Polar Uno CA (collectively, the “Owners”) entered into a Joint Investors Agreement (“JIA”), providing for the incorporation and capitalization of four Venezuelan companies for the purpose of owning, constructing and operating two ammonia and two urea plants to be located in the Venezuelan State of Anzoátegui (the “FertiNitro Project”).