In the case under review, an arbitral tribunal had awarded the claimant/creditor certain sums of money through an award rendered under the Convention on the Settlement of Investment Disputes between States and Nationals of Other States of March 18, 1965 (the ICSID Convention). The claimant/creditor sought to enforce the ICSID Convention award against the foreign state in Switzerland and requested that several assets of the foreign state located in Switzerland, including bank accounts, real estate, trademarks and patents, be seized under a Swiss attachment order pursuant to article 271 of the Swiss Debt Enforcement and Bankruptcy Act (the DEBA).
In this context, the Swiss Federal Supreme Court confirmed that the creditor does not need to obtain a separate exequatur decision prior to seeking an attachment in Switzerland based on an ICSID Convention award and that it is sufficient for the creditor to show on a prima facie basis that the ICSID Convention award will be recognized and enforced. As to the latter, the Swiss Federal Supreme Court noted that article 54(1) ICSID Convention requires each contracting state to recognize as binding any award rendered under the ICSID Convention and enforce in its territory the financial obligations imposed therein as if it were a final judgment of one of its own domestic courts. Pursuant to article 54(2) ICSID Convention, the interested party need only submit a copy of the award certified by the Secretary General of ICSID in order to obtain recognition and enforcement of the award in the territory of a contracting state. The Supreme Court therefore held that under article 54(1) and (2) ICSID Convention, only an examination of the authenticity of the ICSID Convention award can take place prior to enforcement, but no review of the award, not even a public policy review. In order to obtain an attachment based on an ICSID Convention award, it is thus sufficient for the creditor to show on a prima facie basis that the award is an authentic ICSID Convention award.
With regard to the attachment of assets of a foreign state, the Federal Supreme Court reiterated its case law, according to which such attachment requires, firstly, that the foreign state did not act in a sovereign manner («iure imperii») in the legal relationship underlying the attachment claim, but as a holder of private rights («iure gestionis»). Secondly, an enforcement measure against a foreign state, even in cases of private-law actions, presupposes that the legal relationship in question has a sufficient link to Swiss territory. In its decision, the Federal Supreme Court examined in detail whether the requirement of a sufficient link to Swiss territory also applies in the case of an enforcement of ICSID Convention awards which contracting states are obliged to treat as domestic decisions for the purpose of enforcement. The Federal Supreme Court concluded that such requirement applies also in case of ICSID Convention awards. It held that the requirement of a Swiss nexus does not violate article 54 ICSID Convention and referred to doctrine, according to which the requirement of a Swiss nexus is in line with the contracting states&#8217; right to apply their own law on state immunity from execution (article 55 ICSID Convention). According to case law, a Swiss nexus exists in particular if the legal relationship for which the attachment is sought was established in Switzerland or if it is to be fulfilled here or if the foreign state has at least performed certain acts in Switzerland, thus establishing a place of performance in Switzerland. However, it is not sufficient that assets of the foreign state are located in Switzerland or that the claim was awarded by an arbitral tribunal with its seat in Switzerland. The same was found to apply to the fact that Switzerland as signatory of the ICSID Convention is obliged to treat the ICSID award as a Swiss decision for the purpose of enforcement.

 Leading Decision on Enforcement of ICSID Convention Awards

On March 21, 2022, Member States of the International Center for Settlement of Investment Disputes (ICSID) approved amendments to ICSID&#8217;s rules for resolving disputes between foreign investors and host States. The amended rules come into effect on July 1, 2022.
The goal of the amendment was to draw on the lessons learnt from the over 700 ICSID proceedings conducted to date and to modernize, simplify and streamline the proceedings. Some important amendments to the ICSID Arbitration Rules address concerns relating to efficiency, costs of proceedings, greater transparency and security for costs.
The amended arbitration rules provide for greater transparency in the conduct and outcome of the proceedings through new provisions on the publication of documents and the presence of observers at the hearing. As per the amended rules, absent a clear objection within 60 days, parties will be deemed to have consented to the publication of the award. Likewise, tribunals may permit third parties, including the non-disputing treaty party, to make submissions in the proceedings. An additional feature addressing transparency includes disclosure obligations concerning third party funders that apply throughout the proceedings. Parties must now disclose the names and addresses of entities and persons from whom they are receiving funding, and if the funder is a judicial person, then the parties must also disclose who controls the funder.
The amendment also aims at reducing the environmental footprint of ICSID proceedings through the greater use of technology and less paper-intensive procedures. Under the new rules, all filings will be electronic, unless there are special reasons to maintain paper filings.
In order to streamline proceedings and make them more efficient, the amendment has introduced specific timelines for different phases of the proceedings, the most noteworthy being that awards will henceforth have to be rendered no later than 240 days after the last submission. Special procedures have also been introduced for applications to dismiss claims for a manifest lack of legal merit, bifurcation, preliminary objections and provisional measures. New provisions on expedited procedures provide that the parties to an arbitration can, at any time, consent to an expedited arbitration procedure, unless they have opted out. In the case of expedited proceedings, the award must be rendered 120 days after the hearing. The amendment also introduces a requirement that tribunals convene case management conferences at the outset to narrow the issues in dispute.
The amended rules also purport to change the current ICSID practice of requiring each party to bear their own costs by specifically stating the factors that the tribunal must take into consideration when making cost decisions. These include (a) the outcome of the proceeding or any part of it; (b) the conduct of the parties during the proceeding; (c) the complexity of the issues; and (d) the reasonableness of the costs claimed. A new provision on security for costs lays down the procedure and the factors that tribunals must consider when deciding on whether to award security for costs.
Furthermore, access to ICSID arbitration and conciliation has been broadened by granting access to the ICSID Additional Facility Rules in cases where both the claimant and the respondent state are not ICSID Contracting States or nationals of a Contracting State. Under the amended Additional Facility Rules, Regional Economic Integration Organizations, such as the European Union, may also be party to the proceedings.
New rules on mediation and fact-finding have also been added, which may be used as stand-alone procedures or in combination with arbitration proceedings.

ICSID adopts new rules and regulations

Arbitration

Corporate / M&A

Real Estate

Alpiq_bw

Alpiq and Bouygues Construction initiated <a href="https://www.alpiq.com/alpiq-group/media-relations/media-releases/media-release-detail/bouygues-construction-expands-its-arbitration-claim-against-alpiq" target="_blank" rel="noopener">arbitration proceedings</a> against each other in 2019 to resolve their disputes regarding the post-closing purchase price adjustment and alleged breaches of representations and warranties, with a total amount in dispute of approximately CHF 320 m. The matter was placed before a Swiss arbitral tribunal constituted under the Swiss Rules of International Arbitration comprising Prof. Sébastien Besson (Chairperson), Dr. Roberto Dallafior and Dr. Urs Weber-Stecher. It involved the analysis of complex accounting and valuation issues. On December 22, 2020, Alpiq announced that the parties had reached a <a href="https://www.alpiq.com/alpiq-group/media-relations/media-releases/media-release-detail/arbitration-proceedings-settled" target="_blank" rel="noopener">settlement</a> under which Alpiq agreed to refund CHF 54.5 m to Bouygues Construction.
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Homburger&#8217;s arbitration team was led by partner Mariella Orelli and included counsel Kirstin Dodge, associates Bénédict Thomann, Dilber Devitre, Okan Uzun, Pietro Meineri and junior associate Magdalena Stock (all Arbitration). Homburger&#8217;s arbitration team was assisted by Homburger&#8217;s Corporate M&amp;A partners Hansjürg Appenzeller and Daniel Häusermann and Real Estate partner Stefan Gäumann, as well as expert teams from BDO London led by Nick Andrews and David Mitchell. On the clients&#8217; side the matter was dealt with by Peter Schib, Head Group Legal, and Martin Schindler, Head Corporate M&amp;A and Infrastructure.

Homburger successfully represented Alpiq in arbitration proceedings arising from Alpiq's sale of its Engineering Services Business to Bouygues Construction in 2018

She is a member of several below-40 arbitration groups and is admitted to practice law in France.

Dilber
Devitre

Bar Registration

Homburger successfully represented Alpiq in arbitration proceedings arising from Alpiq's sale of its Engineering Services Business to Bouygues Construction in 2018

Leading Decision on Enforcement of ICSID Convention Awards

ICSID adopts new rules and regulations

Investment Treaty Arbitration 2022: Switzerland

Investor-State Arbitration 2022

Investor-State Arbitration 2021

Join the Team

Dilber Devitre

Career

Languages

Bar Registration

Teams

DilberDevitre

Bar Registration

Homburger successfully represented Alpiq in arbitration proceedings arising from Alpiq's sale of its Engineering Services Business to Bouygues Construction in 2018

Leading Decision on Enforcement of ICSID Convention Awards

ICSID adopts new rules and regulations

Investment Treaty Arbitration 2022: Switzerland

Investor-State Arbitration 2022

Investor-State Arbitration 2021

Join the Team

Dilber Devitre

Career

Languages

Bar Registration

Teams

Dilber
Devitre