Stock states, “ICSID has properly rejected two attempts by Argentina to obstruct the
international treaty arbitration. Argentina remains bound by the Tribunal’s Decision on
Jurisdiction, the Tribunal Majority remains in place, and the case moves forward.”
The Italian Bondholders secured two important victories over Argentina at the World Bank’s
International Centre for Settlement of Investment Disputes (ICSID). ICSID rejected an
arbitrator disqualification challenge that Argentina had filed against two of the three
Tribunal members. ICSID also rejected a challenge that Argentina had filed against the
Tribunal’s Decision on Jurisdiction and Admissibility. Both recent ICSID decisions follow the
4 August 2011 issuance of the Tribunal’s Decision on Jurisdiction in the bondholders’ favor.
Despite Argentina’s attempted obstructions, the case moves forward.
Argentina’s Arbitrator Challenge Is Rejected
On 21 December 2011, the President of the World Bank, acting in his capacity as the
Chairman of the ICSID Administrative Council, issued a decision rejecting in its entirety
Argentina’s 15 September request to disqualify two of the three Tribunal members,
President Pierre Tercier and Claimants’ party-appointed arbitrator Albert Jan van den Berg.
The ICSID Chairman concluded that Argentina’s request did not meet the disqualification
standard set forth under Article 57 of the ICSID Convention. The Italian Claimants’ position
was that the arbitrator challenge was utterly without legal merit.
The ICSID decision rejecting Argentina’s disqualification request was accompanied by a
thorough assessment of the request by the Secretary-General of the Permanent Court of
Arbitration (PCA) in The Hague. At Argentina’s insistence, ICSID had referred the request
to the PCA for review and recommendation. In a reasoned decision, the PCA Secretary-
General concluded, as did the ICSID Chairman, that Argentina’s arbitrator challenge failed
to articulate any valid basis to disqualify either arbitrator. The conclusions reached by
ICSID and the PCA, both preeminent institutions in the field of international arbitration,
confirm the well-established principle under the ICSID Convention that an arbitrator cannot
be disqualified simply because a party disagrees with his decisions.
ICSID and the PCA rejected each of the grounds Argentina articulated for its disqualification
request, and concluded that the request instead reflected Argentina’s dissatisfaction with
the Tribunal’s rulings against it. Further to the decision, President Tercier and Arbitrator
van den Berg retain their positions on the Tribunal.