Victory for Pakistan in the BVI: Cameron Miles successfully resists enforcement of a US$6 billion ICSID award in the long-running Tethyan Copper Company case
Cameron Miles (led by Vernon Flynn QC, together with Lucas Bastin, Angeline Welsh and Mubarak Waseem), instructed by Ogier, has successfully resisted BVI enforcement of the US$6 billion ICSID Award handed down by the tribunal in Tethyan Copper Company Pty Limited v Islamic Republic of Pakistan, on behalf of Pakistan.
In December 2020, Tethyan obtained ex parte orders against the Pakistan and other respondents – including Pakistan’s national airline, Pakistan International Airways Corporation (PIA) – granting recognition and enforcement the Award in the BVI, granting provisional charging order over the shares of certain BVI companies owned by PIA for the benefit of Tethyan and imposing a receiver over those companies.
Following a substantive return date hearing on 26–29 April 2021, the BVI Commercial Court on 25 May 2021 set aside all orders obtained by Tethyan on the basis of (inter alia) Tethyan’s failure to give full and frank disclosure to the Court as to the scope of Pakistan’s immunity under the State Immunity Act 1978 – following the judgment of Mr Justice Teare in Gold Reserve Inc v Bolivarian Republic of Venezuela. The receivership has been discharged with immediate effect, and the discharge of the other orders is scheduled to take effect on 4 June 2021.
The case was the first in the BVI dealing with recognition and enforcement of ICSID Awards, the procedural requirements for service on a foreign state under the Eastern Caribbean CPR following the English Court decision in General Dynamics v Libya and the circumstances in which state-owned corporations can be assimilated to the state to meet the state’s obligations under an arbitration award. It has been described in media reports as “historic legal victory” for Pakistan.
Judgment was handed down orally. A written judgment is in the process of being prepared.