Foley Hoag Secures Victory for Peru and Dismissal of Claims by Bacilio Amorrortu

August 25, 2022

Under the representation of Foley Hoag LLP, Peru has secured an early dismissal of the claims brought by former Peruvian and current U.S. citizen Bacilio Amorrortu under the U.S.-Peru Trade Promotion Agreement (USPTPA). Claimant was seeking a compensation of over $90 million.

A majority of the three-member tribunal at the Permanent Court of Arbitration hearing the case has sided with Peru and upheld one of its objections to the tribunal’s jurisdiction. Peru argued that it did not consent to arbitrate the dispute because Mr. Amorrortu’s waiver of its right to initiate or continue any related proceeding before other fora did not comply with the requirements set out Article 10.18(2)(b) of the USPTPA.

In its Partial Award on Jurisdiction dated August 5, 2022, the Tribunal unanimously agreed with Peru that the Claimant’s waiver was conditional, and, as such, did not comply with the requirements of the USPTPA. A majority of the Tribunal further agreed with Peru that the submission of a compliant waiver is not a condition for the admissibility of claims, but a precondition for the very existence of the State’s consent to arbitrate. According to the majority, the USPTPA language is “unequivocal” that the submission of a valid waiver is a “precondition to a State’s consent to arbitration,” and that an invalid waiver deprives any arbitral tribunal of jurisdiction ab initio due to the lack of an arbitration agreement. As the majority states in its Partial Award, “the arbitration agreement in question here was never concluded, because a specifically negotiated condition was never met,” and the tribunal “has no power to direct a party to cure a defect in that agreement, in order – retrospectively – to endow itself with jurisdiction.”

Foley Hoag is currently representing Peru in five other investment arbitrations before the International Center for Dispute Settlement, as well as Peru-owned Perupetro in an ICC commercial arbitration.

Foley Hoag attorney Ken Figueroa, who led the team representing Peru, said this was an important victory for the State: “We are honored to have represented Peru in this arbitration and obtained this win over claims manifestly outside the jurisdiction of the tribunal. We look forward to defending the interests of Peru in the other international arbitrations in which we act for the Republic.”

The Foley Hoag team representing Peru also included Ofilio Mayorga, Alberto Wray, Gisela Paris, José García Rebolledo, Juan Pablo Hugues, Eva Treves, Karim M’ziani, Paulina Alvarado, and Nancy Lopez.