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The first ICSID case against Guinea is dismissed for lack of jurisdiction

In a decision dated December 21, 2015, a tribunal at the International Centre for Settlement of Investment Disputes (ICSID) ruled that it lacked jurisdiction to hear a case brought by Société civile immobilière de Gaëta (Gaëta) against Guinea under the Guinean Investment Code.

Having built the Cité des Chemins de Fer (the Cité) in Conakry, Gaëta alleged expropriation of its investment and a violation of fair and equitable treatment (FET) by Guinea. Gaëta sought compensation of around US$90 million. The tribunal, however, concluded that Gaëta had not succeeded in proving that it was a foreign investor within the meaning of the Investment Code. Moreover, Gaëta did not establish that it had made a protected investment within the meaning of the Investment Code and article 25 of the ICSID Convention.

Background

Gaëta is a company registered with the French Commercial Register. It is managed by its managing director, Mr. Guido Santullo. Gaëta made its investment in Guinea in 1997 through a construction lease agreement. The project comprised the construction of several buildings for commercial, administrative and banking purposes on the site of the Cité. The lease, planned to have a life of 60 years, also provided Gaëta a right to rent the buildings. The contract also provided significant exemptions on customs duties, taxes and fees as well as on state fees.

Following conclusion of the contract, Gaëta had turned to another company, Séricom Guinée, for the planning, development and construction work. Mr. Guido Santullo is the majority shareholder of this company. After the completion of work in 1999, the buildings were leased to third parties. A second company controlled by Mr. Guido Santullo, SCI Cité des Chemins de Fer, provided security and maintenance services for the premises in the Cité and billed the tenants for its services.

By STEFANIE SCHACHERE

Source:Investment Treaty News

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