Doups Holdings LLC v. United Mexican States

Case summary

At a glance

Parties: Doups Holdings LLC (United States) v. United Mexican States
Case no.: ICSID Case No. ARB/22/24
Forum and rules: ICSID Convention arbitration; ICSID Arbitration Rules in force from 1 July 2022, as modified by NAFTA Chapter 11, Section B; place of proceeding Washington, D.C.; language Spanish
Treaty: NAFTA Chapter 11 (Articles 1103, 1105, 1110, 1116, 1117), invoked through Annex 14-C of the USMCA (T-MEC)
Tribunal: Alexis Mourre (President), Stanimir A. Alexandrov, Marcelo G. Kohen
Sector: Parking meters; municipal concessions; mobile payment
Outcome: Pending. The published documents are procedural. The Tribunal bifurcated the case and is hearing six of Mexico's seven jurisdictional objections in a preliminary phase, with a jurisdiction hearing scheduled for 9–10 March 2026.

The dispute

Doups Holdings LLC is a limited liability company organised under California law. It held shares in Soluciones Pagomet CDMX, S.A.P.I. de C.V. (formerly Taximedia Soluciones Digitales), to which Mexico City's Mobility Secretariat (Semovi) granted two concessions in 2018 to install and operate parking meters in certain zones of Mexico City. The concessions were revoked on 20 January 2020. Doups claims, on its own behalf (NAFTA Article 1116) and on behalf of Pagomet (Article 1117), breaches of most-favoured-nation treatment (Article 1103), the minimum standard of treatment (Article 1105) and the expropriation provision (Article 1110). Through the MFN clause it also seeks to rely on the umbrella clause of the Mexico–Switzerland BIT. Mexico raised seven preliminary objections: no 'investment' under Article 25 of the ICSID Convention; no 'existing investment' on 1 July 2020 under USMCA Annex 14-C; no jurisdiction over indirect (reflective) loss under Article 1116; a late Pagomet waiver under Article 1121(2); no ownership or control of Pagomet on the relevant dates; Mexican nationality of the claimant and a foreigner-exclusion clause in Pagomet's by-laws; and no import of an umbrella clause through Article 1103.

Key holdings

Bifurcation granted. The Tribunal will decide the second to seventh objections in a preliminary phase. The first objection, on whether there is an investment under the Salini criteria, is joined to the merits because it would require reviewing the same evidence as the merits. Procedural Order No. 3, ¶¶ 61–69
Under ICSID Rule 44(2) there is no presumption for or against bifurcation. Where several preliminary objections are related, they must be assessed together, including the chance that a combination of them succeeds. The Tribunal found on a prima facie basis that bifurcation could end the case or significantly narrow the issues left for a second phase. Procedural Order No. 3, ¶¶ 50–59
The Annex 14-C 'existing investment' objection, the Article 1116 indirect-loss objection, the Article 1121(2) waiver objection, the control objection, the nationality objection and the MFN/umbrella-clause objection all turn mainly on treaty interpretation or on facts distinct from the merits. They can therefore be bifurcated without duplicating argument and evidence. Costs of the decision are reserved. Procedural Order No. 3, ¶¶ 63–68
Marcelo Kohen concurred in a separate declaration. He stressed that jurisdictional objections go to consent, which is needed to discuss the merits as well as to decide them. In his view, efficiency gains cannot justify making a party argue the merits before jurisdiction is decided. Procedural Order No. 3, Declaration of Marcelo Kohen, ¶¶ 1–3
Document production, claimant's requests. Mexico must conduct reasonable searches across the government bodies involved in the negotiations and produce travaux préparatoires on USMCA Annex 14-C ('existing investment') and on NAFTA Articles 1116, 1117, 1121(2), 1103, 201 and 1139. The Tribunal recorded Mexico's agreement to search for records of meetings with Semovi officials. Request 12 was rejected because the documents responded to Pagomet's or Doups' own information requests and should be in the claimant's possession. Procedural Order No. 4, Annex I, Requests 1–12
Document production, Mexico's requests. Doups must produce corporate records of Doups, Ixchel Holdings, Testudo and Pagomet that show decisions on actions taken on Doups' behalf, using best efforts for non-party entities. It must also produce records of the individual's ties to Mexico relevant to nationality, internal documents from January 2019 to July 2020 on the decision to increase its stake in Pagomet, and documents on the credit agreement (C-112). Requests for financial statements were rejected as relating to quantum. Other broad requests were rejected for lack of specificity or as speculative. Production was due by 12 September 2025. Procedural Order No. 4, ¶¶ 10–12; Annex II, Requests 1–16