Chevron wins $700 million Ecuadorian claim
Chevron Corp. has won a $700 million claim against Ecuador from an international arbitration tribunal in The Hague.
By OGJ editors
HOUSTON, Mar. 31 -- Chevron Corp. has won a $700 million claim against Ecuador from an international arbitration tribunal in The Hague.
The tribunal said Ecuador violated the US-Ecuador Bilateral Investment Treaty by failing to provide effective means of asserting claims and enforcing rights.
In a case that went to arbitration in 2006, Chevron had argued that Ecuador’s courts violated international law through delays in ruling on commercial disputes during the 1990s between Texaco Petroleum Co., now a Chevron subsidiary, and the government.
The $700 million award covers principal damages and interest as of Dec. 22, 2006, and is subject to adjustment for taxes, compound interest, and costs.
The case is separate from Chevron’s international arbitration filing last year against the Ecuadorian government in a long-running environmental dispute in which the government seeks damages exceeding $27 billion (OGJ Oct. 5, 2009, Newsletter).
Responding to the new ruling, Chevron echoed criticism it has made about Ecuadorian courts in the environmental dispute.
“We have maintained for some time that Ecuador’s courts are failing to administer justice when it comes to Chevron and its affiliates, and an international tribunal has now agreed,” said Hewitt Pate, the company’s general counsel and a vice-president. “We hope this ruling will help move Ecuador towards proper treatment of foreign investors and respect for the rule of law.”
