1. ICSID CASES
INVOLVING
CARICOM STATES
Dr Chantal Ononaiwu
Trade Policy & Legal Specialist
Caribbean Regional Negotiating Machinery
OAS/CRNM/CARICOM WORKSHOP
“NEGOTIATING CARICOM INVESTMENT AGREEMENTS:
STATE OF PLAY AND WAY FORWARD”
GRENADA REX RESORT HOTEL, GRENADA, 22-25 JUNE 2009

2. Introduction
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Five CARICOM Member States have been involved in
disputes brought to ICSID:
Grenada (2)
Guyana (1)
Jamaica (3)
St Kitts & Nevis (1)
Trinidad & Tobago (2)
Most of these cases were brought pursuant to ISDS
clauses in contracts.
Only two were initiated under ISDS provisions in BITs.

3. Contract-
Contract-based Cases
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Grenada
• WRB Enterprises & Grenada Private Power Ltd v
Grenada
• RSM Production Corporation v Grenada
Jamaica
• Alcoa Minerals of Jamaica Inc v Jamaica
• Kaiser Bauxite Co v Jamaica
• Reynolds Jamaica Mines Ltd & Reynolds Metals Co v
Jamaica

4. Contract-
Contract-based Cases
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St Kitts & Nevis
• Cable Television of Nevis & Cable Television of Nevis
Holdings v Federation of St Kitts & Nevis
Trinidad & Tobago
• Tesoro Petroleum Corporation v Trinidad & Tobago

5. Treaty-
Treaty-based Cases
5
Guyana
• Booker plc v Guyana
Trinidad & Tobago
• FW Oil Interests v Trinidad & Tobago

6. Subject Matter of Disputes
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Oil and gas
exploration and Bauxite mining
exploitation
Privatization of
Cable TV charges
electricity enterprise
Debt arising from nationalisation

7. GRENADA’S DISPUTES
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8. WRB Enterprises & Grenada Private Power Ltd
v Grenada
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• In 1994, the government agreed to sell to WRB Enterprises (a
US company) a 50% stake in the island’s electricity company,
GRENLEC.
• The successor government refused to approve the privatization,
claiming the deal was unfair.
• In 1997, the government threatened to re-nationalize the
company by buying out WRB. However, WRB was unwilling to
renegotiate.
• WRB brought the dispute for arbitration before ICSID in 1997.
• The government later accepted the privatization and the parties
agreed to a settlement.

9. RSM Corporation v Grenada
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• In 1996, RSM (a US company) and Grenada entered into an
agreement for the exploration, and potential extraction, of oil
and gas deposits in a designated area off Grenada, Petite
Martinique and Carriacou.
• RSM contracted to apply, within 90 days of signature of the
agreement, for an exploration license, which Grenada had to
award.
• Under the contract, RSM could invoke force majeure to
excuse performance of the agreement and delay the 90-day
period for applying for the license. There was no time
limit to the period of force majeure.
• Force majeure covered Grenada’s maritime boundary dispute
with Venezuela and Trinidad & Tobago.
• RSM was required to take ‘all reasonable steps’ to remove the
cause of the force majeure.

10. RSM Corporation v Grenada
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• Fourteen days after the agreement was signed, RSM
invoked the force majeure clause, which allowed it to
suspend the 90-day period for the next 8 years.
• During this 8-year period, RSM’s CEO participated in
Grenada’s maritime boundary negotiations with
Venezuela and Trinidad & Tobago.
• Unilaterally, he attempted to negotiate with Venezuela and
commenced a lawsuit against Venezuela’s state oil
company.
• He authorized false maps that favoured T&T, pursued
unilateral proceedings against T&T before ICSID and
ITLOS and wrote a threatening letter to the Prime Minister
of T&T.

11. RSM Corporation v Grenada
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• In January 2004, RSM notified its revocation of force
majeure and applied for a licence in April 2004.
• Grenada refused to grant the licence and terminated
the agreement in July 2005.
• In 2005, RSM initiated ICSID arbitration proceedings
pursuant to the arbitration clause in the agreement.
• RSM sought a declaration that the 1996 agreement was
still in force and Grenada must grant it a licence. In the
alternative, it sought damages.

12. RSM Corporation v Grenada
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• Grenada alleged breach of contract and counterclaimed
for illegal misrepresentation under Grenadian law,
entitling termination of the agreement and damages.
• It claimed that RSM’s actions in relation to T&T and
Venezuela amounted to a breach of its obligation
regarding removal of force majeure.
• Grenada also claimed that it was misled to believe that
RSM was able to carry out exploration and development,
as well as the expertise to assist with maritime boundary
delimitations.

13. RSM Corporation v Grenada
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• In 2006, while the ICSID arbitration proceedings were
pending, RSM filed a complaint in a New York court against
a Grenadian Senator and three other persons, raising issues
of corruption against them and claiming over US$500
million in damages.
• The arbitration tribunal made several procedural orders in
relation to the New York legal proceedings. Ultimately, the
tribunal was satisfied that the Senator’s testimony before it
was not adversely affected by those proceedings.

14. RSM Corporation v Grenada
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• The arbitration rendered its award in 2009, dismissing
RSM’s substantive claims.
• The 1996 agreement had either lapsed in March 2004 when the
90-day period expired, or was lawfully terminated by Grenada
in 2005.
• Grenada’s counterclaim was also rejected.
• RSM’s breach of its obligation regarding removal of force
majeure did not entitle termination of the agreement and
Grenada did not prove loss entitling damages.
• Some of the alleged misrepresentations were not made and,
where the CEO had made misrepresentations, they were not
fraudulent.
• The parties were ordered to bear their own legal costs and split
the costs of arbitration.

15. GUYANA’S DISPUTE
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16. Booker plc v Guyana
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• In 1976, Guyana nationalized a UK company’s
investments in the Guyanese sugar industry.
• A long-term compensation plan was agreed.
• Payment installments were interrupted in the 1980s
while the government considered re-privatization of the
sugar industry.
• When the government decided against this, negotiations
over payment of the remaining debt resumed.
• After unsuccessful negotiations, Booker plc invoked the
UK-Guyana BIT to launch arbitration with ICSID.

17. Booker plc v Guyana
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• An arbitration ruling requiring Guyana to pay Booker plc
could have jeopardized the country’s efforts to qualify
for the IMF’s Highly Indebted Poor Countries
programme.
• Following negative press coverage and demonstrations in
the UK, Booker plc’s parent firm abandoned the claim
and the proceedings were discontinued.

18. JAMAICA’S DISPUTES
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19. Alcoa Minerals, Kaiser Bauxite, Reynolds
Jamaica Mines v Jamaica
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The Government of Jamaica entered into agreements
with several US bauxite companies to construct an
alumina refining plant in return for a 25-year bauxite
mining concession.
The agreements contained a “no further tax” clause,
under which Jamaica undertook to impose only those
taxes and royalties specified in the agreement.
The agreements also provided for the submission of
disputes arising under them to ICSID.

20. Alcoa Minerals, Kaiser Bauxite, Reynolds
Jamaica Mines v Jamaica
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In 1974, the Government decided to renegotiate aspects of
the agreements in order to secure greater national control
over bauxite reserves and to derive a higher level of
revenues from the sector.
In May 1974, Jamaica introduced the Bauxite (Production
Levy) Act, which imposed a new tax on bauxite mining.
Shortly before enacting the statute, Jamaica filed a
notification with ICSID, pursuant to Article 25(4) of the
Convention, to exclude disputes arising out of an
investment relating to minerals or other natural resources.

21. Alcoa Minerals, Kaiser Bauxite, Reynolds
Jamaica Mines v Jamaica
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Three of the bauxite companies initiated separate
arbitration proceedings before ICSID, seeking the return
of the monies paid pursuant to the Act.
Jamaica refused to appoint an arbitrator and failed to
appear at the first meeting of the arbitration tribunal.
The tribunal decided to deal with its jurisdiction as a
preliminary point in order to determine whether:
the disputes fell within the subject-matter jurisdiction of
ICSID; and
Jamaica’s notification of withdrawal affected the prior
consent to arbitration.

22. Alcoa Minerals, Kaiser Bauxite, Reynolds
Jamaica Mines v Jamaica
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The tribunal held that the disputes were within the
jurisdiction of ICSID.
The case concerned a legal dispute arising directly out of
an investment
Jamaica is a Contracting State under the Convention and
the companies were nationals of the US, another
Contracting State
The companies and Jamaica consented in writing to
submit the dispute to ICSID.

23. Alcoa Minerals, Kaiser Bauxite, Reynolds
Jamaica Mines v Jamaica
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It found also that Jamaica could not withdraw its consent
to the arbitration given in the agreements.
Its notification to ICSID could only operate in respect of
potential future investors.
“[A]ny other interpretation would...deprive the Convention of
any practical value for Contracting States and investors”
The parties eventually reached a settlement and the
proceedings were discontinued in 1977.

24. Alcoa Minerals, Kaiser Bauxite, Reynolds
Jamaica Mines v Jamaica
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Further challenges to the bauxite levy were made in
other fora.
In 1976, Revere Jamaica Ltd initiated a constitutional
challenge to the Bauxite (Production Levy) Act before
the Supreme Court of Jamaica.
The Supreme Court found that an undertaking to bind the
Government as to future taxation was invalid and created
no valid contractual right in favour of Revere.

25. Alcoa Minerals, Kaiser Bauxite, Reynolds Jamaica
Mines v Jamaica
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In 1976, Revere Copper & Brass instituted a claim under the
expropriation provision of a guaranty contract with the
Overseas Private Investment Corporation (OPIC), before
the American Arbitration Association.
The arbitration tribunal found an expropriation under the
terms of the contract. The Government’s introduction of the
levy directly prevented Revere from exercising effective
control over the use or disposition of its property.
Revere was awarded approximately US$1.1 million plus
interest of 6% p.a.

26. ST KITTS & NEVIS’ DISPUTE
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27. Cable TV Nevis & Cable TV Nevis Holdings v St
Kitts & Nevis
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• In 1986, two US-owned companies entered into an
agreement with the Nevis Island Administration (NIA)
granting them a cable TV franchise.
• The agreement contained an ICSID arbitration clause.
• The companies instituted arbitration proceedings
against the Federation of St Kitts & Nevis in respect of
a dispute related to charges for cable TV services in
Nevis.
• The Federation objected to ICSID’s jurisdiction in the
matter.

28. Cable TV Nevis & Cable TV Nevis Holdings v St
Kitts & Nevis
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Article 25, ICSID Convention:
(1) The jurisdiction of the Centre shall extend to any legal
dispute arising directly out of an investment, between a
Contracting State (or any constituent subdivision or
agency of a Contracting State designated to the
Centre by that State) and a national of another
Contracting State, which the parties to the dispute
consent in writing to submit to the Centre…
(3) Consent by a constituent subdivision or agency of a
Contracting State shall require the approval of that State
unless that State notifies the Centre that no such approval is
required.

29. Cable TV Nevis & Cable TV Nevis Holdings v St
Kitts & Nevis
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• The Tribunal declined jurisdiction over the dispute.
• NIA, and not the Federation, was the party to the
agreement containing consent to ICSID jurisdiction.
• The Constitution of St Kitts & Nevis established Nevis as
a constituent subdivision of the Federation.
• The NIA had not been designated to ICSID as a
constituent subdivision under Article 25(1) of the ICSID
Convention.
• The Federation had not notified ICSID, pursuant to
Article 25(3), that its approval of NIA’s consent to ICSID
jurisdiction was not required.

30. TRINIDAD & TOBAGO’S DISPUTES
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31. Tesoro Petroleum Corporation v
Trinidad & Tobago
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• In 1968, Tesoro and the Government of Trinidad and
Tobago entered into a joint venture to purchase and develop
oil fields.
• After the first 5 years of operation of the joint company,
dividends could be declared.
• From 1981, relations between the Government and Tesoro
became strained.
• The Government refused to approve the declaration of
dividends for 1981 and 1982.
• In 1982, Tesoro decided to sell its shares in the joint venture
and the parties entered into negotiations over the
Government’s possible purchase of the shares.

32. Tesoro Petroleum Corporation v
Trinidad & Tobago
32
• In 1983, Tesoro initiated conciliation proceedings before
ICSID, seeking damages for the Government’s alleged
breach of its obligation to support the payment of
dividends for the two years.
• In light of the Conciliator’s recommendations, the parties
agreed in 1985 to settle the matter through payment of
dividends to the shareholders for the period 1981-1985.
• The case has been cited as a good example of how
conciliation proceedings may help the parties settle their
differences at relatively small cost of time and money.

33. FW Oil Interests v Trinidad & Tobago
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FW Oil (a US firm) claimed that, in 2000, it was
awarded a contract to develop oil and gas fields
located off Trinidad’s south-west coast, but the
contract was revoked several months later.
In 2001, FW Oil instituted ICSID arbitration
proceedings under the US-Trinidad & Tobago BIT.
It alleged that Trinidad & Tobago had breached the
contract, the laws of Trinidad & Tobago and the BIT,
and claimed compensation for its lost profits and
wasted costs.

34. FW Oil Interests v Trinidad & Tobago
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The Trinidad & Tobago press reported that FW Oil
had alleged that it was the victim of corruption by
officials by state enterprises and a former
Government Minister.
The arbitration tribunal rendered its award in 2006,
finding that FW Oil had not established that it had
an “investment” as defined under the terms of the
BIT.

35. THANK YOU
chantal.ononaiwu@crnm.org
www.crnm.org
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