新加坡上诉法院维持原判

PCA对争议不具管辖权，撤销仲裁裁决

一、前言

      新加坡上诉法院驳回了南非投资方对新加坡高等法院决定撤销常设仲裁院（Permanent Court of Arbitration, PCA）仲裁裁决的判决的上诉。法院认为，PCA不因莱索托曾参与解散通过多边条约建立的争端解决机制，而当然对针对其的投资索赔拥有管辖权。判决原文请见：

https://www.supremecourt.gov.sg/news/supreme-court-judgments/page/3

本案主要有以下三个相关要点：

首先，如果投资方声称依据投资协定中的仲裁条款而将争议提交仲裁，但争议却不属于该条款的范围，仲裁庭做出的裁决视为超出其仲裁范围或不在其仲裁范围，在此情况下，拥有管辖权的法院有权依据《联合国国家贸易委员会国家商事仲裁示范法》（UNCITRAL Model Law on International Commercial Arbitration, Model Law）（以下简称“《示范法》”）撤销该仲裁裁决。

其次，为了具有提交投资仲裁的资格，涉案资产必须除了符合投资协定中“投资”定义外，还须同时与东道国的领土具有关联性。为满足领土关联性的要求，投资须在东道国境内进行。由于各国通常不具有域外管辖权，投资方如果想对在东道国内进行的投资寻求保护，需首先诉诸于国内法律。

最后，投资通常不仅仅局限于单一的权利，例如开发投资商的主要权利；相反会包含有系列的权利，包括寻求救济和维护主要权利的次级权利。

二、案情梳理

1988年，作为本案第一上诉人，同时也是莱索托登记注册公司的Swissbourgh Diamond Mines（Pty）Limited（以下简称“Swiss bourgh”），获得莱索托五个地区的勘探和采矿租约（以下简称“采矿租约”）。作为莱索托登记注册公司第五至第九上诉人（以下简称“受托人”），他们与Swiss bourgh公司并登记了采矿租约分租许可证协议，并负责经营Swiss bourgh各地区钻石开采业务。1991年至1995年，莱索托采取了各种措施，据称这些措施阻碍了Swiss bourgh公司根据采矿租约行使采矿权，造成其利润损失。

2009年6月，上诉人向南共体法庭对莱索托提起诉讼，要求莱索托赔偿损失，理由是莱索托错误地征用采矿租约，违反了南共体条约规定的义务。然而，在2010年8月至2015年8月期间，南共体有关理事机构一致采取一系列行动，致使南共体法庭无法正常运作，从而使上诉人无法继续在南共体法庭的起诉。此外，相关主管机构亦未提供任何其他法院来继续审理和裁定南共体法庭的未决案件。

2012年6月，上诉人向PCA提出仲裁申请，主张莱索托违反了《南共体条约》、《法庭议定书》和《投资议定书》规定的各项义务，参与解散南共体法庭事务，却没有为南共体未决案件提供其他替代法院。莱索托对PCA的管辖权提出质疑。于2016年10月20日，PCA裁定上诉人胜诉，认为其有权审理本案，且莱索托违反了各项投资协定规定的义务，并指示当事方应组成一个新的仲裁庭，审理上诉人的赔偿请求，并命令莱索托承担上诉人在仲裁中的费用。莱索托随后向仲裁地的新加坡高等法院提出撤销仲裁裁决申请。

2017年4月4日，新加坡高等法院对本案作出判决，裁定撤销PCA仲裁裁决。理由在于PCA对当事人之间的争议缺乏管辖权。上诉人对该判决向新加坡上诉法院提出上诉，主张新加坡高等法院对于仲裁裁决撤销申请不具有管辖权，PCA具有受理双方投资争议的管辖权，故本案的争议应由当事人双方新组成的仲裁庭审理。

2018年11月27日，新加坡上诉法院对本案作出终审判决，维持原判，认定PCA不具有审理此案的管辖权，撤销其所做出的仲裁裁决。

三、新加坡上诉法院的裁判要点

（一）新加坡高等法院有权受理此案

根据《示范法》第34(2)(a)（iii）条，如若仲裁裁决的内容不属于或超出仲裁协议的范围，法院有权受理撤销该仲裁裁决的申请。本案中，莱索托对PCA是否具有审理当事人争议的管辖权提出质疑，PCA仲裁地在新加坡，当然有权向新加坡法院提出申请撤销PCA仲裁裁决。另一方面，当一国签订约定将投资争端提交仲裁的投资协定时，它事实上提出单方面的仲裁要约，并且如果投资方接受了该要约，则可以自行仲裁并根据该要约的条款提出索赔。如果投资方声称依据投资协定中的仲裁条款而将争议提交仲裁，但其后发现争议不在该仲裁条款的范围之内，法院则有权以此为由撤销仲裁庭作出的裁决。而本案当事人莱索托只表示愿意为解决南部非洲发展共同体部分审理的要求提供一个替代争端解决法院，并未作出任何正式的单方面声明或不容反悔的陈述，表示接受PCA审理其与上诉人之间的争议。故新加坡高等法院有权受理仲裁当事人一方莱索托要求撤销PCA仲裁裁决的申请。

（二）PCA对争议不具有管辖权

本案中，PCA要受理投资争议案件，需满足《附件1》第28（1）条规定的三个要件：(a) 必须属于“投资”； (b) 该项投资必须被东道国“承认”； (c)必须存在“涉及（莱索托）对（该项）承认的投资义务”的争端。这些术语必须根据《投资议定书》的目标和宗旨来解释，其主要目标是通过促进和保护在南共体成员国的投资来增加南共体区域内的投资流动。

首先，涉案事项符合第1（2）条中关于“投资”的规定。为符合该条件，需与东道国具有领土关联性，才有资格成为“投资”。为了满足领土关联性的要求，投资必须在东道国境内进行或位于东道国境内。当主张东道国违反投资协定规定的义务时，应首先查明受到侵犯的具体权利，并考虑该权利是否与东道国具有必要的领土关联性，从而确定东道国依据国际法应当承担的义务。就《附件1》第28（1）条而言，“采矿租约”符合第1（2）条中“投资”的定义，即“生产性和证券投资资产”，因为它们完全属于第1（2）条中“投资”定义(e)项的范围，属于“寻找、培育、开采或开发自然资源的许可证”。同时，采矿租约还满足了领土关联性的要求，因为它们包含有根据莱索托国内法就位于莱索托领土内的财产设定和赋予的权利的内容。

其次，该项投资被东道国莱索托承认。本案中，采矿租约满足了第28（1）条和第1（2）条的要求，即必须根据莱索托的法律“承认”投资，因为有充分证据表明莱索托接受采矿租约。即使后来发现采矿租约在技术上无效，这也不能意味着不存在有效的许可。

最后，本案并不存在“涉及莱索托对该项被承认投资义务”的争端。将争端提交南共体法庭的权利（“提交权”）不属于采矿租约的权利范围，因为它与莱索托没有必要的领土联系。而只能在国际法层面上存在；且该项权利的保证行使不是莱索托所能控制的，因为它完全取决于是否存在和维持一个经南部非洲共同体成员国同意而根据国际法建立的机制。根据《南共体条约》第35条和第36条规定，只要南共体四分之三的成员国通过履行这一决议，或修正《南共体条约》以取得类似结果，南共体法庭随时可以解散。据此，莱索托不可能单独否决或阻止南共体其他成员国同意通过任何此类决议。所以，提交权不是莱索托可以单方面保障的权利，不属于莱索托的执法管辖权范围。

另外，《南共体条约》和《南共体法庭议定书》不是投资保护文件，且并不赋予当事人可以诉诸南共体法庭任何可强制执行的权利。尤其根据《南共体条约》第32条，只规定南共体成员国之间关于国家间争端的争端解决机制，《法庭议定书》第14条和第15条只笼统地宣布南共体法庭的管辖权范围，并不构成南共体成员国同意投资者向南共体法庭提交具体投资争端的独立依据。因此，根据《附件1》第28（4）条规定，向南共体提出的索赔要求不属于南共体法庭属时管辖权的范围。

由此可以得出，解散南共体法庭的争端并不属于PCA可受理案件范围，本案并不存在“涉及莱索托对该项被承认投资义务”的争端。因为争议所涉及的东道国义务，必须是莱索托所承担的义务，即保证上诉人能够诉诸南共体法庭，或为提交南共体的诉求建立另一个审理的法院。由于提交权不属于采矿租约的权利范围，而且采矿租约并没有使莱索托承担任何相应的义务保证提交南共体法院的要求将得到审理，因此，本案涉及的争端不属于第28（1）条规定的范围，所以PCA对本案不具有管辖权。

（三）上诉人并未穷尽国内司法救济途径

最后，根据《南共体条约》《附件1》第28（1）条和第15条，明确要求当事人在将投资争端提交国际仲裁之前应穷尽当地补救办法。法院认为，不存在证据表明，由于棘手的案件积压或缺乏司法独立性，莱索托的法院对本案不能进行有效的救济。因此，在莱索托仍可能存在其他合理且有效的救济途径，上诉人理由不成立。

【判决摘要】

Case Summaries

Swissbourgh Diamond Mines (Pty) Ltd and others v Kingdom of Lesotho [2018] SGCA 81

SUPREME COURT OF SINGAPORE

27 November 2018

Case Summary

Swissbourgh Diamond Mines (Pty) Ltd and others v Kingdom of Lesotho [2018] SGCA 81 

Civil Appeal No 149 of 2017

_____________________________________________________________________

Decision of the Court of Appeal (delivered by Chief Justice Sundaresh Menon)

CoA dismisses appeal by South African investors against HC decision to set aside PCA arbitration award; PCA tribunal had no jurisdiction to hear their investment treaty claim against Lesotho for participating in the disbanding of a dispute resolution body established by multilateral treaty

Pertinent and significant points of the judgment

·      Where an investor purports to rely on the arbitration clause contained in an investment treaty to refer a dispute to arbitration but the dispute is found to fall outside the scope of that clause, the award issued by the arbitral tribunal should be considered to deal with matters not contemplated by or not falling within the arbitration agreement, such that the court would have the jurisdiction to set aside the award pursuant to Art 34(2)(a)(iii) of the UNCITRAL Model Law on International Commercial Arbitration: at [79] and [80].

·      To qualify as an investment to be submitted to arbitration, an asset must both satisfy the definition of an “investment” provided in the investment treaty and have a territorial nexus with the host State. To satisfy the territorial nexus requirement, the investment must be made or located within the territory of the host State and, if and to the extent it is conceived of as a bundle of rights, those rights must exist and be enforceable under the domestic laws of the host State. Investors can only expect protection in relation to investments that are made within the host State because States generally have no extraterritorial jurisdiction and cannot purport to protect rights or property located outside their borders: at [98], [99] and [102].

·      An investment is generally not limited to a single right, such as the primary right to exploit the investment; instead, it generally encompasses a bundle of rights which also includes the secondary right to seek remedies and to vindicate the primary right: at [120].

Background

1 This was an appeal brought by the first to ninth appellants (collectively, “the Appellants”) against the decision of the High Court judge (“the Judge”) to grant an application (“the Setting Aside Application”) brought by the Kingdom of Lesotho (“the Kingdom”) to set aside a partial final award on jurisdiction and merits (“the Award”). The Award was issued by an ad hoc international arbitration tribunal constituted under the auspices of the Permanent Court of Arbitration (“the PCA”) and seated in Singapore (“the PCA Tribunal”). The Appellants had commenced arbitration proceedings (“the PCA Arbitration”), pursuant to Art 28 of Annex 1 to the Protocol on Finance and Investment of the Southern African Development Community (“the Investment Protocol”), against the Kingdom, which is a member of an intergovernmental socio-economic organisation known as the Southern African Development Community (“the SADC”).

2 The Appellants’ complaint in the PCA Arbitration was that the Kingdom had contributed to or facilitated the shutting down (or “shuttering”) of another tribunal (“the SADC Tribunal”), which is a dispute resolution body established pursuant to the Treaty of the Southern African Development Community (“the SADC Treaty”) read with the Protocol on Tribunal in the Southern African Development Community (“the Tribunal Protocol”), without providing for an alternative forum to determine disputes referred to the SADC Tribunal. This in turn caused a pending claim brought by the Appellants against the Kingdom (“the SADC Claim”) to remain unheard. The PCA Tribunal found in favour of the Appellants, and ordered the parties to constitute a new tribunal to hear the part-heard SADC Claim. The Kingdom then commenced the Setting Aside Application, which the Judge granted (“the Judgment”).

The material facts

3 The first appellant, Swissbourgh Diamond Mines (Pty) Limited (“Swissbourgh”) is a Lesotho-incorporated company that is owned by the second to fourth appellants (ie, Mr Josias Van Zyl, and the representatives of the Josias Van Zyl Family Trust and the Burmilla Trust). In 1988, Swissbourgh was granted prospecting and mining leases (“the Mining Leases”) in five regions in the Kingdom. The fifth to ninth appellants (collectively, “the Tributees”) are Lesotho-incorporated companies which entered into and registered licensing agreements with Swissbourgh for the sub-lease of the Mining Leases, and served as operating companies responsible for the diamond mining operations in various areas in the Kingdom.

4 Subsequently, between 1991 and 1995, the Kingdom implemented various measures which allegedly hindered Swissbourgh from exercising its mining rights under the Mining Leases, resulting in losses of profit (“the Expropriation Dispute”).

5  In June 2009, the Appellants commenced proceedings against the Kingdom before the SADC Tribunal, claiming damages against the Kingdom on the ground that the Kingdom had allegedly breached its obligations under the SADC Treaty by wrongfully expropriating the Mining Leases (ie, the SADC Claim). However, between August 2010 and August 2015, the relevant governing organs of the SADC unanimously undertook a series of steps that left the SADC Tribunal unable to operate or function, which thus made it impossible for the Appellants to prosecute the SADC Claim. Also, no alternative forum was provided to hear and determine any of the pending claims before the SADC Tribunal (“the Shuttering Dispute”).

6 In June 2012, the Appellants commenced the PCA Arbitration against the Kingdom, alleging that the Kingdom had breached various obligations under the SADC Treaty, the Tribunal Protocol and the Investment Protocol by participating in the shuttering of the SADC Tribunal without providing an alternative means for the SADC Claim to be determined. The Kingdom challenged the jurisdiction of the PCA Tribunal. The PCA Tribunal found in favour of the Appellants, holding that it had jurisdiction to hear and determine the claim, and that the Kingdom had indeed breached its obligations under the various treaties. The PCA Tribunal granted relief by directing the parties to constitute a new tribunal to hear the Appellants’ expropriation claim, and ordered the Kingdom to pay the Appellants’ costs in the arbitration.

7 The Kingdom then filed the Setting Aside Application. The Judge allowed the application, and set aside the Award in its entirety on the ground that the PCA Tribunal lacked jurisdiction over the parties’ dispute. The Appellants appealed against the Judgment, submitting that the court had no jurisdiction to hear the Setting Aside Application, the PCA Tribunal did indeed have jurisdiction to render the Award, and the Appellants should be entitled to have the Expropriation Dispute heard by a new tribunal to be established by the parties. Conversely, the Kingdom submitted that the court did indeed have the jurisdiction to hear the Setting Aside Application, and that the Award had correctly been set aside by the Judge given the Appellants’ failure to satisfy the jurisdictional requirements under Art 28(1).

The court’s decision

8 The appeal was dismissed. To this end, the court held that: (a) it did have jurisdiction to hear the Setting Aside Application and to set aside the Award under Art 34(2)(a)(iii) of the UNCITRAL Model Law on International Commercial Arbitration (“the Model Law”); (b) the Kingdom was not bound by the doctrines of estoppel or formal unilateral declaration to accept the PCA Tribunal’s jurisdiction in these proceedings; and (c) the Award should be set aside because the PCA Tribunal had no jurisdiction to hear and determine the claim referred by the Appellants, and the Appellants might not have exhausted their local remedies: at [59] and [227].

9 The court had jurisdiction to hear the Setting Aside Application pursuant to Art 34(2)(a)(iii) of the Model Law, which states that an award may be set aside if it “deals with a dispute not contemplated by or not falling within the terms of the submission to arbitration”, even though the Kingdom was contesting the very existence of the PCA Tribunal’s jurisdiction to hear and determine the claim referred to it. Article 34(2)(a)(iii) covers situations where the award deals with matters not contemplated by or not falling within the arbitration agreement, and not merely situations where the award decides issues outside the scope of the parties’ submissions in the arbitration. When a State enters into an investment treaty that provides for the submission of disputes to arbitration, it effectively makes a unilateral offer to arbitrate, and binds itself to arbitrate a claim brought under and in accordance with the terms of this offer if an investor accepts the offer by initiating arbitration proceedings in accordance with those terms. Hence, where an investor purports to rely on the arbitration clause contained in an investment treaty to refer a dispute to arbitration, but the dispute is found to fall outside the scope of that clause, the court would have the jurisdiction to set aside the award issued by the tribunal on this ground: at [71], [72],[75], [79] and [80].

10 The Kingdom was not bound to accept the PCA Tribunal’s jurisdiction. The Kingdom did not make any formal unilateral declaration expressing any intention to accept the PCA Tribunal’s jurisdiction or make any representation to that effect which it is estopped from resiling from. The Kingdom had only expressed its willingness to offer an alternative dispute resolution forum for the resolution of the part-heard SADC Claim: at [85], [88] and [91].

11 Article 28(1) of Annex 1 sets out the requirements which have to be satisfied for the PCA Tribunal to assume jurisdiction over the claim, and thus serves as the yardstick against which the Appellants’ purported acceptance of the Kingdom’s consent to arbitration is to be measured. It contains at least three key jurisdictional requirements: (a) there must be an “investment”; (b) the investment must have been “admitted”; and (c) there must be a dispute which “concern[s] an obligation of the [Kingdom] in relation to [that] admitted investment”. These terms must be interpreted in the light of the object and purpose of the Investment Protocol, a cardinal objective of which is to increase the flow of investment into the SADC region by promoting and protecting investments in the SADC Member States: at [92] to [94].

12 To qualify as an “investment” for the purposes of Art 28(1) of Annex 1, an asset must both satisfy the definition of an “investment” found in Art 1(2) and have a territorial nexus with the host State. To satisfy the territorial nexus requirement, the investment must be made or located within the territory of the host State and, if and to the extent it is conceived of as a bundle of rights, those rights must exist and be enforceable under the domestic laws of the host State. This requirement is supported by not only the provisions of Annex 1, but also general principles of international investment law. Investors can only expect to enjoy guarantees of certain standards of treatment or protection in relation to investments that are made within the host State because States generally have no extraterritorial jurisdiction and cannot purport to protect rights or property located outside their borders. When making an investment, investors acquire property and/or rights that exist or are conferred as a matter of the host State’s domestic law. The extent and scope of those rights are also to be determined as a matter of domestic law. As a matter of international law, the host State undertakes certain obligations and may be liable if those domestic law rights within its jurisdiction are violated. When it is alleged that the host State has violated its obligations under the investment treaty, it may be necessary to identify the particular right that has been violated and consider whether that right has the requisite territorial nexus with the host State so as to implicate the obligations of the host State that arise as a matter of international law: at [93], [98] to [103] and [109].

13 The Mining Leases, the shares in Swissbourgh and the Tributees held by Mr Van Zyl and the representatives of both the JVZF Trust and the Burmilla Trust, as well as the resources expended in pursuing the exploitation of the Mining Leases (collectively, “the Mining Leases”) qualified as an investment for the purposes of Art 28(1) of Annex 1. They satisfied the definition of an “investment” under Art 1(2) as “productive and portfolio investment assets”, as they fell squarely within para (e) of the definition of “investment” in Art 1(2), which refers to “licences to search for, cultivate, extract or exploit natural resources”. The Mining Leases also fulfiled the territorial nexus requirement as they consisted of rights created and conferred under the domestic laws of the Kingdom in respect of property situated within the Kingdom’s territory: at [111(a)]and [112] to [114].

14 The Judge erred by assuming that the Mining Leases could not have been the relevant investment just because the claim in the PCA Arbitration had been brought in respect of the Shuttering Dispute. The Mining Leases can in principle comprise a multitude of rights. An investment is generally not limited to a single right, such as the primary right to exploit the investment; instead, it generally encompasses a bundle of rights which also includes the secondary right to seek remedies and to vindicate the primary right. A dispute submitted to investment arbitration might concern the breach of a secondary rather than a primary right, provided that secondary right is part of the investment the host State has undertaken to protect and has the requisite territorial nexus with the host State. A secondary right need not accrue to the investor at precisely the same time as the acquisition of the investment for that secondary right to be protected under the investment treaty: at [120],[128] and [131].

15 The right to refer a dispute to the SADC Tribunal (“the right to refer”) did not fall within the Mining Leases’ bundle of rights because it did not have the requisite territorial nexus with the Kingdom. It could only exist on the international law plane and its assurance was not a matter within the Kingdom’s control as it was entirely dependent on the existence and maintenance of a mechanism established under international law by the consent of the SADC Member States. Pursuant to Arts 35 and 36 of the SADC Treaty, the SADC Tribunal could have been dissolved at any time as long as three-quarters of all SADC Member States were to adopt a resolution implementing such a decision or amend the SADC Treaty to achieve a similar outcome. It would have been impossible for the Kingdom, acting alone, to have vetoed or prevented any such resolution which the rest of the SADC Member States had all agreed to pass. The right to refer was therefore not a right that could be guaranteed by the Kingdom acting unilaterally, and fell outside its enforcement jurisdiction: at [135], [139] and [142].

16 In any event, the right to refer could not fall within the Mining Leases’ bundle of rights because it did not even exist at the time the SADC Claim was brought. The SADC Treaty and the Tribunal Protocol are not investment protection instruments, and do not confer upon the Appellants any enforceable right of access to the SADC Tribunal. In particular, Art 32 of the SADC Treaty only provides for a dispute resolution mechanism between SADC Member States in respect of inter-State disputes, and Arts 14 and 15 of the Tribunal Protocol only declare the scope of the SADC Tribunal’s jurisdiction in general terms and do not constitute an independent basis of consent by the SADC Member States to the submission of particular investment disputes by investors to the SADC Tribunal. The entry of force of the Investment Protocol in 2010 did not change this conclusion as the Expropriation Dispute had arisen long before the Investment Protocol entered into force, thus the SADC Claim would have fallen outside the SADC Tribunal’s jurisdiction ratione temporis under Art 28(4) of Annex 1: at [146], [152], [154] and [158].

17 Even though a part-heard arbitration claim can in principle qualify as a stand-alone investment, the SADC Claim did not. The SADC Claim satisfied the Art 1(2) definition of an “investment” as it had economic value and fell within the ambit of a “productive and portfolio investment assets”, and more specifically, was a legal claim for a monetary remedy under para (c) of the definition of “investment” in Art 1(2). It might in principle also be considered a continuation or transformation of the original investment, which are the Mining Leases. However, the SADC Claim could not qualify as an investment because it failed the territorial nexus requirement. It only existed as a matter of international rather than domestic law, and fell outside the Kingdom’s enforcement jurisdiction and could not be a protected investment under the relevant treaties. The putative transformation of the Mining Leases into the SADC Claim was distinguishable from that found in other cases where the claimants’ original investments were replaced by the crystallisation of a domestic law right that fell within the investment’s bundle of rights. In contrast, the SADC Claim only existed as a matter of international law and lay beyond the Kingdom’s enforcement jurisdiction for the same reasons as the right to refer: at [162] to [164] and [172] to [175].

18 Having found that neither the right to refer nor the SADC Claim qualified either as investments or as inherent parts of a qualifying investment, this left the Mining Leases (without the right to refer or the SADC Claim in the constituent bundle of rights) as the only viable qualifying investment under Art 28 of Annex 1. The Mining Leases satisfied the requirement under Art 28(1) and Art 1(2) that an investment must be “admitted” in accordance with the Kingdom’s laws, as there was ample evidence of the Kingdom’s acceptance of the Mining Leases. Even if the Mining Leases were later found to be technically invalid, this would not mean that there was no valid admission: at [176], [177] and [179].

19 There was no qualifying dispute “concerning an obligation of the [Kingdom] in relation to [the Appellants’] admitted investment”, which was the Mining Leases, as required under Art 28(1) of Annex 1. The Shuttering Dispute could not be the qualifying dispute because it was, in essence, about whether the Appellants had a right to have the SADC Claim heard by the SADC Tribunal. The correlative obligation to that right must be one owed by the Kingdom to guarantee the Appellants’ access to the SADC Tribunal or to establish an alternative forum for the SADC Claim to be heard. Because the right to refer did not fall within the Mining Leases’ bundle of rights, and the Mining Leases did not give rise to any corresponding obligation on the part of the Kingdom to guarantee that the SADC Claim would be heard, there was no obligation in relation to the Mining Leases which the Shuttering Dispute was concerned with, and therefore that dispute logically could not fall within the terms of Art 28(1). The Expropriation Dispute, on the other hand, fell outside of the PCA Tribunal’s jurisdiction ratione temporis. As there was no qualifying dispute which could fall within Art 28 and the scope of the Kingdom’s consent to arbitration before the PCA Tribunal, the PCA Tribunal lacked jurisdiction to hear and determine the Appellants’ claim: at [182] to [184].

20 Article 28(1) of Annex 1 and Art 15 of the SADC Treaty expressly require the Appellants to have exhausted all local remedies before submitting a dispute to international arbitration. The initial burden is on the Appellants to show that there are no reasonably available local remedies or where local remedies provide no reasonable possibility of effective redress. The Appellants’ argument that the Mining Leases are invalid would defeat the Kingdom’s objection on exhaustion of local remedies as they would not have suffered any wrong to be remedied, but this would in turn destroy their whole claim for investment protection. Accordingly, the court had to proceed with the exhaustion analysis on the basis that the Appellants did have a valid investment and rights in domestic law capable of protection. It would be premature to infer from the dearth of existing precedents alone that an Aquilian action, a claim in the law of delict for pure economic loss resulting from the wrongful conduct of the State, would not be reasonably available. There was no evidence that there is no possibility of effective redress in the Kingdom’s courts on the basis of intractable case backlog or a lack of judicial independence. There might therefore be a reasonably available and effective remedy in the way of an Aquilian action and this too would have foreclosed the Appellants’ claim and warranted a dismissal of the appeal in any event: at [207], [213], [219] to [222], [224] and [226].

This summary is provided to assist in the understanding of the Court’s judgment. It is not intended to be a substitute for the reasons of the Court. All numbers in bold font and square brackets refer to the corresponding paragraph numbers in the Court’s judgment.

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