Telefónica S.A. v. United Mexican States

Case summary

At a glance

Parties: Telefónica S.A. (Spain) v. United Mexican States
Case no.: ICSID Case No. ARB(AF)/12/4
Forum and rules: ICSID Additional Facility; Additional Facility Rules in force since 10 April 2006; place of arbitration Washington D.C.
Treaty: Spain–Mexico Agreement for the Promotion and Reciprocal Protection of Investments (APPRI) of 4 April 2008
Tribunal: Eduardo Zuleta Jaramillo (President), Horacio Grigera Naón, Ricardo Ramírez Hernández
Sector: Mobile telecommunications; interconnection rates
Outcome: Procedural Order No. 1 (8 July 2013) restricted the disclosure of hearing transcripts, party documents and correspondence; Ricardo Ramírez Hernández dissented on confidentiality. The published texts do not show the merits.
Amount: Each party was asked for an advance payment of USD 150,000 to ICSID.

The dispute

Telefónica S.A., a Spanish company with mobile telephony concessions in Mexico, started an Additional Facility arbitration against Mexico under the 2008 Spain–Mexico APPRI. According to Mexico, the dispute concerned interconnection rates authorised by COFETEL and the SCT. The published documents deal only with procedure. The parties agreed on most of the rules for the proceeding but disagreed on confidentiality. Telefónica wanted everything except the award kept confidential, because its filings would contain sensitive market, cost and network data. Mexico wanted filings and orders made public, with protected information redacted, relying on the NAFTA Free Trade Commission's Note of Interpretation and on Mexico's Federal Transparency Law.

Key holdings

The APPRI, the ICSID Convention and the Additional Facility Rules contain no general rule of confidentiality or of publicity binding the parties. Article XVI(4) of the APPRI requires only that the final award be public. PO1 ¶¶ 20–21, 24–27
The NAFTA Note of Interpretation does not apply, by analogy or otherwise. Article XV of the APPRI fixes the applicable law, and Spain is not a party to NAFTA (VCLT Articles 26 and 34). Mexico's Federal Transparency Law also does not apply. PO1 ¶¶ 22–23
The Tribunal rejected both parties' proposed clauses. It acted under Articles 27 and 35 of the Additional Facility Rules and sought to protect the integrity of the proceeding and confidential information, while allowing Mexico to inform the public. PO1 ¶¶ 28–32
The parties may not disclose to third parties the hearing transcripts or minutes, the documents and pleadings they file, or the procedural correspondence. They may ask the Tribunal, with justification, to lift or change these limits in specific cases. Disclosing the Tribunal's orders and decisions needs the Tribunal's prior authorisation, except for the award and this order. The parties may discuss general aspects of the case in public, provided they do not aggravate the dispute or get around the order. PO1 ¶ 42
Ricardo Ramírez Hernández dissented. In his view the majority created an unjustified presumption of confidentiality that reflected only the Claimant's position. It also failed to analyse Mexico's redaction mechanism or to require proof of a reasonable risk that disclosure would aggravate the dispute. Dissent ¶¶ 3–14

Procedural history

7 September 2011Notice of Intent (text not included in the documents provided).
9 March 2012Telefónica files its Request for Arbitration and asks for approval of access to the Additional Facility.
21 June 2012The ICSID Secretary-General approves access to the Additional Facility and registers the case.
6 December 2012Tribunal constituted, with members appointed by agreement of the parties.
14 May 2013First Session held by telephone conference, including oral argument on confidentiality.
8 July 2013Procedural Order No. 1 dispatched to the parties, with its decision on confidentiality.
8 July 2013Dissenting opinion of Ricardo Ramírez Hernández on confidentiality.
20 February 2018Order of Discontinuance (text not included in the documents provided).