Ahmed Diaa Eldin Ali Mohamed Hussein v. Arab Republic of Egypt

At a glance

Parties

Dr. Ahmed Diaa Eldin Ali Mohamed Hussein (dual US–Egyptian national) v. the Arab Republic of Egypt

Forum and rules

UNCITRAL Arbitration Rules (2010); the claimant proposed ICSID administration in Washington, D.C.

Treaty

U.S.–Egypt BIT (Article III(1), expropriation; Article VII, dispute settlement)

Sector

Paper and cardboard manufacturing

Outcome

Only the Notice of Arbitration (3 February 2021) is published. The published documents do not show the outcome.

Amount

Claimed: the lost value of the investment in SIMO, no less than approximately USD 20,000,000 (its 1997 value), plus payments for delay, interest, fees and costs.

The dispute

Dr. Ahmed Diaa Eldin Ali Mohamed Hussein holds both US and Egyptian nationality. Starting in 1997, he bought more than 70% of the shares of SIMO, an Egyptian paper and cardboard manufacturer, on the Egyptian Stock Exchange, on behalf of himself and his family. He says the investment was worth about USD 20,000,000. In March 1999, the Chairman of the Companies Regulatory Authority appointed a trustee to manage SIMO and dissolved its board. In 2006, Egyptian courts cancelled that decision and ordered the company returned to its shareholders. In 2014, however, the Administrative Court ordered SIMO returned to the State because of alleged defects in the sale, including an undervalued share price. The Prime Minister then issued a decree directing the Minister of Finance to provide funds for the shareholders' rights, but the claimant says the decree was never carried out. By letter of 8 September 2020, the Government told the claimant that it was not competent to decide his complaint. The claimant says no compensation was ever paid and that this is an expropriation in breach of Article III(1) of the U.S.–Egypt BIT.

Key holdings

1. No decision has been published. The Notice claims that Egypt expropriated SIMO in March 1999 without compensation, and that its refusal to pay, set out in the letter of 8 September 2020, breaches Article III(1) of the U.S.–Egypt BIT. Notice ¶¶ 3, 10–17
2. The claimant invoked Article VII(1)–(3) of the BIT and the UNCITRAL Rules. He proposed a sole arbitrator, English as the language of the arbitration, and ICSID administration in Washington, D.C. Notice ¶¶ 18–22
3. The relief sought was: a declaration of jurisdiction and of breach; compensation of no less than approximately USD 20,000,000 (the 1997 value of the investment) plus payments for delay; pre- and post-judgment interest; and all arbitration costs. Notice ¶¶ 23–25

Procedural history

1. March 1999The Chairman of the Companies Regulatory Authority appoints a trustee for SIMO and dissolves its board.
2. 2006Egyptian courts cancel the 1999 decision and order SIMO returned to its shareholders. A 2007 decision of the General Authority for Investment & Free Zones confirms the judgment.
3. 2014The Administrative Court orders SIMO returned to the State. The Prime Minister issues a decree implementing the order.
4. 8 September 2020The Egyptian Government informs the claimant that it is not competent to decide his complaint.
5. 3 February 2021The claimant serves the Notice of Arbitration under the UNCITRAL Rules.
6. 20 April 2022The Notice is filed as an exhibit in court case 1:22-cv-02592-JSR. It later appears in the appendix in Case 22-1506, dated 13 September 2022.

Tribunal, counsel and experts

For the claimant

Nixon Peabody LLP

For the respondent

Egyptian State Lawsuits Authority

Run a conflict check on these names →

Keywords

• U.S.–Egypt BIT
• expropriation
• compensation for expropriation
• fair market value
• SIMO
• paper manufacturing
• dual nationality
• UNCITRAL Rules 2010
• Companies Regulatory Authority
• trustee appointment
• Egyptian Stock Exchange
• sole arbitrator
• notice of arbitration
• payments for delay

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