The United States district court of Columbia has dismissed Pakistan’s motion for a stay regarding the enforcement of the $6 billion fine awarded in favor of Tethyan Copper Company (TCC).
In 2019, the International Centre for Settlement of Investment Disputes (ICSID) made a $6 billion award against Pakistan’s government. The award was made in response to a long-running dispute between Pakistan and Tethyan Copper Company, an Australian mining firm.Â
TCC had petitioned the United States district court of Columbia after ICSID’s ruling for an order confirming the award and entering judgement in the amounts mentioned. This case then deteriorated into a series of successive stays.Â
Pakistan appealed the award to the International Centre for Settlement of Investment Disputes (ICSID), requesting that it be annulled or modified in its entirety. All of these actions resulted in automatic interim stays of execution, which the district court of Columbia applied to these cases. Those stays, however, have all come to an end.Â
Pakistan then requested the Court to delay the proceedings or, in the alternative, to dismiss the case outright, two years after TCC filed its lawsuit and more than a decade after TCC began arbitration. The Court dismissed both these motions because Pakistan had not demonstrated its claim to a stay and D.C. circuit law demands respect to ICSID arbitrability judgments.
The reason why Pakistan has been spending millions of dollars in litigation and getting the courts to delay or to annul the award given the repercussions it would have on the national coffers. The ruling at the American court essentially means that TCC now has the legal grounds to seize assets of the government in order to settle the fine imposed on Pakistan by ICSID.Â
Pakistan appealed to the International Centre for the Settlement of Investment Disputes (ICSID) in November 2019 to have the award annulled. That application caused a provisional stay of enforcement, as required by ICSID regulations. The district court of Columbia also put a hold on its own proceedings as well.
Additionally Pakistan’s motion to dismiss the case has also been denied. Pakistan’s arbitrability claim regarding the dismissal of the case is not admissible under the FSIA, the court said. Even if it were, precedent from the D.C. circuit dictates that the court defer to the tribunal’s decision on arbitrability. Pakistan consented to arbitrate, according to the tribunal. Pakistan also acknowledges that the ICSID convention is an international accord, the court noted.Â
Moreover due to these factors, the court rejected Pakistan’s move to delay or dismiss TCC petition. Pakistan is obliged to adhere to and comply with the award, which is final. The award’s “pecuniary duties” will also be enforced by the court.Â
Nice Article written by asadUllah Kamran on US court reject pakistan request to stay Reko diq,
Nice information shared
Our being a signatory to ICSID does not benefit us in any way that I can see.
It is another whip we have put in the hands of the US to beat us with.
In how many cases has the government applied to the ICSID in the past to get redress, with a decision in it’s favour?
The government has few bi-lateral treaties ratified with countries to protect our investors there. Thid is partly because we do not have many Pakistanis who openly invest abroad, and partly as countries where this is needed most for our invesrors’ protection are aware of the ramifications, and delay concluding and ratifying a BIT. Without this ICSID cannot be approached.
It is not as if this extra guarantee has brought investors flocking to our shores!
We should re-examine the benefit to us historically, and future trends of our likely investment abroad, then decide our continuing as a signatory accordingly.