Although the arbitration award of August 30 in favor of the oil company Chevron, which obliges the State to pay a compensation not yet determined, put the PRD in a bind, in its Directorate of International Affairs still awaits, in addition, another eight arbitration resolutions of investment and seven commercial; and seven trials in the Court of Justice of the Andean Community and fourteen in several countries. In total, 17 claimants claim Ecuador a payment of $ 13,357.9 million, with data cut to September 20.
A case that is striking is the so-called Petroecuador Panama, in which there is a demand for the sum of $ 11,450 million, representing 85.7% of the total claims with a predetermined amount. This trial was filed in Panama in April last year Efrén Moreira against the state oil company.
At the time, the Panamanian justice even ordered the seizure of the company’s cash, but such a measure was never executed because it argued that false documents were used in the process. The litigation is open.
The second highest demand is from oil company Perenco, which demands an indemnity of $ 1,572 million. It is followed by the cases ‘Hermanos Ortega’ ($ 191 million) and ‘APM-Hutchinson’ ($ 177.5 million). The rest requests amounts of less than $ 70 million.
According to the Attorney General’s Office, there are also 19 cases in which there is no specific amount, since these values must be set by arbitration forums and courts abroad.
Among them are, for example, the demand of Gente Oil (which challenges a report from the Comptroller’s Office that detects irregularities) and another from the Isaias brothers.
This newspaper requested an interview with the prosecutor, Íñigo Salvador, but it was not granted. In statements to newspaper El Comercio, the official said that between 2005 and 2018 the State has allocated $ 318 million for its defense.
The oil expert Augusto Tandazo argues that “the same thing you want to save by removing the subsidies is what is going to hire external lawyers by the Attorney General.”
For former minister Fernando Santos, “it’s incredible that a fortune has been spent to finally lose all important cases.”
A lawyer from one of the plaintiffs companies, who requested the reservation, explained to this newspaper that when controversies arise in which the State does not cede or discuss arbitrations and judgments abroad, “without being perfect”, they grant more legal guarantees and independence to investors.
In the Chevron III case, the Attorney General’s Office has announced that it will request the interpretation and then the nullity of the award.
In the rest, it will evaluate the hiring of lawyers abroad and will open spaces to negotiate with the plaintiffs before a ruling is reached that could be unappealable.
In as much, the controversies have put to the government of Lenin Moreno under the pressure of several embassies that watch over the interests of their companies or natural persons that are in dispute with the country.
On May 16, 2017, one week before the end of his term, Rafael Correa annulled the bilateral investment treaties (BITs) that protect foreign investors with specific clauses.
However, according to another plaintiff lawyer, the issue is much more complex than it seems, because, on the one hand, in most BITs that decision only takes effect one year later (May 2018), while for the other, some have a clause that allows companies to protect their investors for another ten or more years. An example: BITs with the USA and the United Kingdom.
The government of Lenin Moreno has insisted that it will honor its international obligations. However, due to the high amounts involved, the award in favor of Chevron ignited alerts about disputes with foreign companies and individuals that are in the hands of the State Attorney General’s Office.
In May 2017, Rafael Correa denounced (terminated) the bilateral investment treaties with the United States, the United Kingdom, the Netherlands, Canada, Germany, Switzerland, Sweden, France, Spain, China, Italy, Chile, Venezuela, Argentina, Peru and Bolivia.
In February of this year, the then Foreign Minister, María Fernanda Espinosa, announced that -in order to attract foreign investment- the Government had designed a proposal of “bilateral investment agreements (CBI)” to replace the treaties that were denounced by Correa. However, those documents are still a project under discussion.
Of the fifteen arbitrations in force, seven are commercial and eight of investment the latter are based on the breach of the BIT by the Ecuadorian State. (I)