Investment arbitration under the Energy Charter Treaty: the novel case of Plama Consortium Limited v. Republic of Bulgaria - Chapter 2 - Energy Dispute Resolution: Investment Protection, Transit and the Energy Charter Treaty
Jonathan C. Hamilton is a Partner in the global law firm of White & Case LLP and a leading authority on international dispute resolution and investment related to the energy sector. Based in Washington, DC, Mr. Hamilton commenced his career in the Firm’s New York office, spent several years in the Mexico City office and worked for a stint with a major firm in Lima, Peru. He has particular experience in Latin America and emerging markets and is the editor of Latin Arbitration Law.
Petr Polásek is a member of the White & Case LLP International Arbitration Group in Washington, DC. He focuses on foreign investment disputes under international treaties and investment contracts and on commercial arbitration matters.
Sylvia Tonova is an associate in the Washington, DC office of White & Case LLP and practices with the International Arbitration Group. She concentrates her practice on the representation of sovereign States and private clients in investment treaty and commercial arbitration matters. Ms. Tonova was part of the team that represented the Republic of Bulgaria in Plama Consortium Limited v. Republic of Bulgaria (ICSID Case No. ARB/03/24), the first case to reach a resolution on the merits under the Energy Charter Treaty before the International Centre for Settlement of Investment Disputes (ICSID).
The Energy Charter Treaty (the “ECT”) is a unique multilateral treaty for the promotion of international cooperation and the protection of foreign investments in the energy sector.1 The ECT, ratified by almost 50 States, provides foreign investors in the energy sector certain protections and recourse to international arbitration.2 The ECT provides for the resolution of investor-State disputes before the International Centre for Settlement of Investment Disputes (“ICSID”), an institution affiliated with the World Bank, or via other dispute mechanisms.
The first ECT case to reach a resolution on the merits before ICSID was Plama Consortium Limited v. Republic of Bulgaria.3 The Plama Award made waves in the legal community with its wide-ranging discussion of the ECT and related issues. A survey of international arbitration practitioners named it Best Award of 2008 and Most Surprising Award of 2008.4 The Award addresses many significant issues relating to international investment law and the interpretation of the ECT, including the consequences of an investment not having been made in accordance with law, the denial of advantages under the ECT, and the scope of the ECT's substantie protections.