Tuesday 21st of November 2017 | Spanish | English

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STATE ATTORNEY GENERAL WILL APPEAL THE DECISION OF THE DISTRICT COURT IN THE HAGUE IN THE CHEVRON III CASE

The State Attorney General, Dr. Diego García Carrión, announced that Ecuador would appeal the decision of the Court in The Hague that dismissed the annulment petition submitted by the State of Ecuador against a series of arbitration awards issued by the Tribunal assigned to try the claim brought by Chevron Corporation and Texaco Petroleum Company against Ecuador. Chevron had claimed alleged judicial fraud in the lawsuit that ordered the oil company to provide compensation to redress the contamination caused throughout Texaco’s operation in the country.

The State Attorney General highlighted the patent error made by Dutch judges when they rejected solid arguments, including the prohibition on a retroactive application of an International Treaty or to a allow a State to interfere with judicial decisions against its own legal framework.

Ecuador filed the annulment petitions against the jurisdiction, partial and interim awards pursuant to which the Tribunal decided that it was competent to try the case, in spite of the absence of investment at the time of the BIT’s entry into force, and other awards that ordered Ecuador to adopt actions preventing enforcement of the environmental suit’s judgment. The Arbitration Tribunal has yet to decide on the merits of Chevron’s claim. This decision now pends and is being tried in different proceedings.

Ecuador’s arguments focuses on the obvious lack of jurisdiction of the Tribunal that determined it was competent to try the arbitration claim under the Bilateral Treaty signed with the United States – the only instrument that could grant jurisdiction to the Tribunal –entered into force in 1997, i.e., five years after Texaco abandoned Ecuador.

The awards also threaten Ecuador’s public order, because they order the Ecuadorian government itself to disregard a judgment that was validly issued by the courts, precluding thereby any analysis on the legality of this judgment by exercised by Ecuadorian courts. Therefore, the State of Ecuador’s defense had explained to the Tribunal that it was impossible to abide by arbitration awards, because doing so would violated its public order.

In turn, the State Attorney General rejected Chevron’s statements regarding this decision. He rejects that they highlight the purported legitimacy of arbitration awards, despite that the parties have had not exhausted the instances of review before Dutch Courts and wrongly announced a victory in the final award, to be issued in the ongoing arbitration case.

He notes that the arbitration tribunal, in its most recent decision, had denied Chevron’s arguments because, in March 2015, the Tribunal had already declared the absence of any impediment to submission of the Lago Agrio litigants’ environmental claim against the company. This implies that the Arbitration Tribunal was carefully reviewing Ecuador’s arguments prior to ruling, and Chevron could not attribute any success to itself.