Orla Mining Ltd. v. Republic of Panama

Case summary

At a glance

Parties: Orla Mining Ltd. (Canada) v. Republic of Panama
Case no.: ICSID Case No. ARB/24/27
Forum and rules: ICSID Convention arbitration; ICSID Arbitration Rules 2022; place of proceeding Washington, D.C.
Treaty: Free Trade Agreement between Canada and the Republic of Panama (signed 14 May 2010, in force 1 April 2013), Chapter Nine (Investment)
Tribunal: Mr. Yves Derains (President), Prof. Dr. Horacio A. Grigera Naón, Mr. Ignacio Torterola
Sector: Mining; mineral concessions
Outcome: Pending. The published documents are procedural: the challenge to the President was rejected (24 September 2025) and Panama's request for bifurcation was dismissed (7 January 2026). No award has been published.

The dispute

Orla Mining Ltd., a Canadian company, held mining investments in Panama through its wholly owned subsidiaries Minera Cerro Quema S.A. (MCQSA) and Aurum Exploration Inc. On 27 November 2023, after the passage of Law 407 of 3 November 2023, Panama's Ministry of Commerce and Industry (MICI) issued Resolutions 82 and 83 (Aurum) and 95, 96 and 97 (MCQSA). These refused extensions of the concession contracts, declared the concessions expired and declared the areas mineral reserve areas. Orla also complained of Panama's conduct over the years, including delays in approving the environmental impact study (EsIA), the failure to sign a pre-approved copper concession agreement, and the Ministry of Labor's refusal to authorise layoffs. Under the Canada–Panama FTA it claims direct expropriation (Article 9.11), indirect expropriation (Annex 9.11), breach of the minimum standard of treatment (Article 9.06), breach of national treatment (Article 9.04), and breach of MFN treatment (Article 9.05), the last relied on to import fair and equitable treatment and an umbrella clause from the UK–Panama FTA. Panama raised five preliminary objections: denial of benefits, lack of jurisdiction over the Aurum claims, the Annex II reservation to MFN, the three-year limitation period, and the contractual nature of the claims.

Key holdings

The proposal to disqualify the President, Yves Derains, was rejected. The grounds based on his long professional relationship with Panama's counsel Eduardo Silva Romero, on past cross-appointments, and on Panama's hiring of Silva Romero after the Tribunal was constituted were filed out of time. Time ran from 9 May 2025, when Wordstone was announced as Panama's counsel, so these grounds were inadmissible under Rule 22. Only the ground based on the 3 July 2025 disclosure was timely. Decision on Disqualification ¶¶ 41, 105–106
On the merits of the challenge, shared membership of the ICC Institute of World Business Law, Silva Romero's editing of the Liber Amicorum in Derains' honour, and earlier cases in which both took part (old, concluded, or with Derains as president or co-arbitrator) raise no reasonable doubt about Derains' impartiality and independence. Failure to disclose is not in itself a ground for disqualification. The appointment of Silva Romero as arbitrator by Derains' firm in NICO v. Bahrain (ICSID Case No. ARB/22/34) also raises no such doubt: Derains has had no equity in Derains & Gharavi since 1 January 2025, and Silva Romero cannot decide that case alone. Costs were deferred. Decision on Disqualification ¶¶ 63, 75, 85–90, 96–98, 108, 111
Panama's request for bifurcation was admissible. The Parties had agreed a non-bifurcated calendar at the first session, but that agreement was not a waiver of the right to seek bifurcation under Rules 42 and 44. A respondent cannot know the consequences of such a waiver before it receives the claimant's memorial. The merits phase was suspended under Rule 44(1)(c). PO3 ¶¶ 14–17
Bifurcation of the preliminary objections was refused. The denial-of-benefits objection (Article 9.15(2)) would dispose of the whole case and is separate from the merits. The question whether a State may deny benefits after the arbitration has begun is open in the case law. But Panama had not shown prima facie that Orla lacks substantial business activities in Canada: Orla has its head office in Vancouver, 27 employees in Canada, and 14 of its 18 directors and officers are based in Canada. The limitation objection is too intertwined with the merits. The Aurum, MFN/Annex II and contract-claim objections would dispose of only a limited part of the dispute, even taken together. PO5 ¶¶ 62–75, 83–84, 92–93, 109–110, 118–122
Separating liability from quantum was also refused. Such a split is justified only if the tribunal is satisfied prima facie that the claim is more likely to fail than succeed, and the two are not so intertwined as to make bifurcation impractical. Neither condition was met. Costs were reserved. PO5 ¶¶ 131–137
Orla's request to publish its own pleadings in the disqualification proceeding was denied. The Parties had agreed under Article 9.30(1) of the FTA, as recorded in paragraph 11 of PO2, that ICSID would not publish written submissions. That treaty-based agreement leaves no room for ICSID Rule 64(2). PO6 ¶¶ 13–16
Where the admissibility of a bifurcation request is contested, Rule 44(1)(c) suspends the merits only once the request is declared admissible. The suspension therefore ran from 24 June 2025, not from the filing of the request on 12 May 2025. The Counter-Memorial deadline of 9 February 2026 was confirmed, but extended by 30 days to 11 March 2026 because of the confusion this had caused. PO7 ¶¶ 21, 25–26