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International Arbitration Forum

Imeks Insaat Makina Elektrik Konstrüksiyon Sanayi Limited Sirketi v. Turkmenistan

Case summary

At a glance

Parties
İmeks İnşaat Makina Elektrik Konstrüksiyon Sanayi Limited Şirketi (Turkey) v. Turkmenistan
Case no.
ICSID Case No. ARB/21/23
Forum and rules
ICSID Convention; ICSID Arbitration Rules 2006
Tribunal
Sir Christopher Greenwood (President), Prof. Stephan Schill, Prof. Rolf Knieper (challenged; replaced Mr. Gabriel Bottini, who resigned)
Sector
Construction
Outcome
Decision of 31 October 2023: the two unchallenged arbitrators upheld the Claimant's proposal to disqualify Prof. Knieper because he was serving at the same time as an expert for Turkmenistan in two pending disputes. The Claimant's other two grounds were rejected.
Amount
No amounts decided. Costs of the disqualification proposal were reserved.

The dispute

İmeks, a Turkish construction company, brought an ICSID claim against Turkmenistan. It alleges that Turkmenistan destroyed its investment in 2009–2010, after a Cabinet of Ministers meeting in May 2009. Mr. Gabriel Bottini resigned as arbitrator, and Turkmenistan then appointed Prof. Rolf Knieper. On appointment, Prof. Knieper disclosed that he had helped draft Turkmenistan's Civil Code. He also disclosed that he was acting as an expert for the Turkmen side in two pending cases, Chemix v. Turkmenistan before the Dutch courts and Turkmenhimiya v. Belgorkhimprom under the SCC Rules, with the same counsel as in this arbitration. İmeks sought his disqualification under Article 57 of the ICSID Convention on three grounds: the concurrent expert work, his personal connections to Turkmen officials, and his public statements praising the Turkmen government and former President Berdimuhamedov. Turkmenistan answered that the expert work was unrelated and essentially concluded, and that his contacts and statements were casual and general.

Key holdings

  1. Test: the challenging party must show that a reasonable third party would find an evident or obvious appearance of lack of impartiality or independence. 'Manifest' refers to how clear the result of the analysis is, not to how easy the analysis is. The test can be reached after extensive argumentation. ¶¶ 74–76
  2. Soft-law instruments give useful guidance but are not binding here. These are the UNCITRAL Arbitration Rules, the IBA Guidelines and the UNCITRAL Code of Conduct for Arbitrators in International Investment Dispute Resolution. The decision rests solely on Article 57 of the ICSID Convention. ¶ 77
  3. Prof. Knieper's concurrent appointment as expert for a party in pending disputes in itself creates an appearance of a manifest lack of independence and impartiality. The fact that the Respondent's counsel instructs him in both disputes compounds it. The Unchallenged Arbitrators found no actual bias and accepted that he acts as an independent expert. The nature of the expert work, any actual dependence and the size of his fees are irrelevant. Article 4(1) of the UNCITRAL Code of Conduct reflects the growing perception that this kind of double-hatting is improper. ¶¶ 79–85
  4. The personal-connections ground was rejected. His contacts with Mr. Meredov and Mr. Hallyýew were not shown to be more than casual. Neither official was shown to have been involved in the measures complained of, which distinguishes Big Sky v. Kazakhstan. ¶¶ 86–90
  5. The public-statements ground was rejected. His praise of Turkmenistan's legal reforms and of former President Berdimuhamedov was very general. It did not concern arbitration or the treatment of foreign investors, and it is not comparable to the statements at issue in Perenco v. Ecuador. ¶¶ 91–94
  6. Costs: the Unchallenged Arbitrators left open whether they have power to award costs in a disqualification decision. They reserved costs for a later stage and directed the Parties to keep a record of their costs. ¶¶ 97–99

Procedural history

  1. 16 April 2021Request for arbitration received by ICSID. It was registered on 5 May 2021.
  2. 21 March 2022Tribunal constituted: Sir Christopher Greenwood (President, appointed by the Chairman of the Administrative Council), Prof. Stephan Schill and Mr. Gabriel Bottini.
  3. 21 March 2023Tribunal decided Turkmenistan's application for security for costs.
  4. 5 June 2023Mr. Bottini resigned. The proceeding was suspended on 7 June 2023.
  5. 21 July 2023Turkmenistan appointed Prof. Rolf Knieper. The Tribunal was reconstituted on 24 July 2023.
  6. 8 August 2023İmeks proposed Prof. Knieper's disqualification, and the proceeding was suspended.
  7. 31 October 2023Decision of the Unchallenged Arbitrators upholding the disqualification proposal.

Tribunal, counsel and experts

Decided by
  • Christopher Greenwood President — appointed by the institution (appointed by the Chairman of the ICSID Administrative Council)
  • Stephan W. Schill Co-arbitrator — appointed by the claimant
  • Gabriel Bottini Co-arbitrator — appointed by the respondent (resigned 5 June 2023)
  • Rolf Knieper Co-arbitrator — appointed by the respondent (replaced Mr. Bottini on 21 July 2023; disqualified 31 October 2023)
For the respondent
Squire Patton Boggs

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Keywords

Summary generated with AI from the published documents — refer to the award for the authoritative text.

Case ID
ICSID Case No. ARB/21/23
Country
Economic sector
Treaty
Turkey - Turkmenistan BIT (1992)
Section