(Factory at Chorzów, Merits, PCIJ, Series A, No. This case is one of the more than forty arbitrations against Argentina related to measures taken during its financial crisis in 2001–2002, although the financial crisis was more peripheral to the facts of this case than it was to most of the others. For these reasons, the expropriation was unlawful (para. The Contract had a six-year term, automatically renewable for two further three-year terms, with parties agreeing to give notice of intent not to renew only if the purpose of the Contract had been fully met. Two weeks later, the Contract was terminated by decree under the terms of the 2000 Emergency Law. The International Arbitration Society established the Arbitration Database in May 2008. In a meeting in December 2000, the President of Argentina promised Siemens to issue the decree approving the Contract Restatement Proposal by the end of the month; however, in March 2001, the Minister of the Interior claimed to have been unaware of the Contract Restatement Proposal. Argentina prohibited SITS from introducing any modification to the system to correct this problem. 2010-9) Expand / Collapse All Applicable IIA. [7] Article 36, “Compensation,” is based on the judgment of the Permanent Court of International Justice in the Factory at Chorzów case, which held: The essential principle contained in the actual notion of an illegal act—a principle which seems to be established by international practice and in particular by the decisions of arbitral tribunals—is reparation must, so far as possible, wipe out all the consequences of the illegal act and reestablish the situation which would, in all probability, have existed if that act had not been committed. (function(i,s,o,g,r,a,m){i['GoogleAnalyticsObject']=r;i[r]=i[r]||function(){ Important from the host state perspective, the award in Siemens v. Argentina clarified that not every breach of a contract is capable of being considered a potential expropriation, but rather only those interferences made through the use of the host state’s “superior governmental power.” Finally, although the award itself did not address investor corruption, the events in its aftermath support the growing view that investors should not be entitled to protection under a BIT when they have themselves acted unlawfully with respect to their investment. Siemens A.G. v. The Argentine Republic ICSID Case No. For one, it concludes that an investor can use a BIT’s most favoured nation (MFN) clause to get access to a more favourable dispute resolution clause in another BIT to which the host state is party. //-->