Olin Holdings Ltd. v. State of Libya

The Paris Court of Appeal dismissed an application to set aside a partial award on jurisdiction in an investor-state arbitration, based on alleged non-compliance with the relevant bilateral investment treaty’s fork-in-the-road provision. The Court held that compliance with the provision went to admissibility, not jurisdiction, and was therefore outside the Court’s purview. The Court also held that it was not bound by the arbitral tribunal’s characterisation of the question as one that goes to jurisdiction, as opposed to admissibility.

Original decision: Cour d'appel de Paris

The partial award on jurisdiction, as well as other related decisions, are available on Jus Mundi.

1 July 2025
Paris Court of Appeal
RG no. 22/20898

Division 5 – Chamber 16

Text of the decision

Heading

FRENCH REPUBLIC
IN THE NAME OF THE FRENCH PEOPLE
 

PARIS COURT OF APPEAL
 

International Commercial Chamber
 

DIVISION 5 CHAMBER 16
 

JUDGMENT DATED 1 JULY 2025
 

(no. 40/2025, 9 pages)
 

Court file registration number: RG no. 22/20898 – Portalis no. 35L7-V-B7G-CG3DQ
 

Decision submitted to the Court: partial award on jurisdiction rendered in Paris on 28 June 2016, administered by the International Chamber of Commerce (ICC Case No. 20355/MCP) by the arbitral tribunal composed of [I] [G] (arbitrator), [O] [B] (arbitrator) and [C] [W] (presiding arbitrator).
 

APPLICANT:
 

STATE OF LIBYA
 

acting through the Supreme Judicial Council, Disputes Department, International Disputes Division
 

[Address 4] TRIPOLI (LIBYA)
 

Lawyer for procedural purposes (“avocat postulant”): Mr Matthieu BOCCON GIBOD of the SELARL LX PARIS-VERSAILLES-REIMS, a lawyer admitted to the PARIS bar, box: C2477
 

Lawyers making submissions for the Respondents: Mr Olivier LOIZON and Mr Max DE CASTELNAU of AARPI GIDE LOYRETTE NOUEL, lawyers admitted to the PARIS Bar, box: T03 and Ms Loujaine KAHALEH, of CURTIS, MALLET-PREVOST, COLT & MOSLE, a lawyer admitted to the PARIS bar, box: J019
 

RESPONDENT:
 

Company [P] HOLDINGS LIMITED
 

a limited liability company under Cyprus law
 

registered in the Cyprus Business Register under number HE 60464
 

whose registered office is: [Address 1] (CYPRUS)
 

acting through its legal representatives,
 

Lawyer for procedural purposes (“avocat postulant”): Mr Jacques BELLICHACH, a lawyer admitted to the PARIS bar, box: G0334
 

Lawyer making submissions: Mr Rami CHAHINE of AARPI MELTEM AVOCATS, a lawyer admitted to the MARSEILLE bar
 

COMPOSITION OF THE COURT:
 

The case was heard on 28 April 2025, in a hearing open to the public, before a Court composed of:
 

Mr Daniel BARLOW, Chamber Presiding Judge
 

Mr Jacques LE VAILLANT, Judge
 

Ms Joanna GHORAYEB, Judge
 

who have held deliberations regarding it.
 

A report was presented at the hearing by Mr Daniel Barlow in accordance with Article 804 of the Civil Procedure Code.
 

Clerk during the hearing: Ms Najma EL FARISSI
 

JUDGMENT:
 

– issued following a process in which both sides were heard
 

– delivered publicly by making the judgment available at the Court registry, with prior notice to the parties in accordance with the terms of the second paragraph of Article 450 of the French Civil Procedure Code.
 

– signed by Daniel BARLOW, Chamber Presiding Judge and by Najma EL FARISSI, Clerk, to whom the signatory judge provided the original of the decision.
 

* *
 

*
 

I/ FACTS AND PROCEDURAL STEPS
 

1. The matter before the Court is an application to set aside a partial arbitral award rendered at [Location 4] on 28 June 2016, administered by the International Court of Arbitration of the International Chamber of Commerce in a case (no. 20355/MCP) between the [P] Holdings Limited ("[P]"), a company incorporated under the laws of Cyprus, and the State of Libya.
 

2. The dispute underlying this award concerns an expropriation measure taken in 2006 by the Libyan authorities concerning land located in [Location 7] on which [P] had built and operated a dairy and fruit juice factory.
 

3. [P] having challenged this measure before the Libyan courts, the Tripoli Court of Appeal, in its judgment dated 13 April 2010, set aside the expropriation order.
 

4. In a judgment dated 14 February 2014, the Tripoli South Court of First Instance dismissed [P]'s compensation claim based on Libyan law.
 

5. [P] brought an arbitration on 3 July 2014 pursuant to Article 9 of the Agreement on the promotion and the reciprocal protection of investments between the Government of the Republic of Cyprus and the Great Socialist People's Libyan Arab Jamahiriya of 30 June 2004 (the "BIT").
 

6. In a partial award dated 28 June 2016, the arbitral tribunal ruled that it had jurisdiction. It stated:
 

“Based on the above, the Tribunal finds, determines and rules as follows :
 

a) The claimant is considered an 'Investor' under the BIT.
 

b) Clause 9.2 of the BIT does not constitute a 'fork-in-the-road' clause.
 

c) The Claimant meets the requirements of Article 9 of the BIT.
 

d) Any further objection by the Respondent of the Claimant's claims in relation to the decisions handed down by Libyan courts is joined in the merits.
 

e) The respondent's claim for damages resulting from the alleged fraudulent and abusive nature of this arbitration is dismissed.
 

f) The Apportionment of Costs is deferred until the Final Award."
 

[Translator's note: the decision includes a translation into French of the above]
 

7. In its final award dated 25 May 2018, it further held:
 

"551. Based on the foregoing, having carefully reviewed all the written and oral submissions made by the Parties in respect of the dispute between them as detailed in this Final Award, the Arbitral Tribunal hereby declares that :
 

a) The Respondent has breached:
 

1. Its obligations under Article 2(2) of the Cyprus-Libya BIT not to impair by unreasonable or discriminatory measures the management, maintenance, use, enjoyment, expansion, or sale of [P]'s investments; and to extend fair and equitable treatment to [P]'s investments ;
 

2. Its obligation under Article 3 of the Cyprus-Libya BIT to treat [P]'s investments no less favourably than it treats the investments of Libyan nationals; and
 

3. Its obligations under Article 7 of the Cyprus-Libya BIT not to expropriate [P]'s investments, directly or indirectly, except for a public interest, in accordance with due process of law, on a non-discriminatory basis, and against payment of prompt, adequate, and effective compensation.
 

b) The Respondent's Counterclaim is dismissed.
 

552. Based on the above, the Arbitral Tribunal orders that the Respondent pay the Claimant:
 

a) The amount of EUR 18,225,000 as compensation for the losses suffered by [P] as a result of Libya's breaches of the Cyprus-Libya BIT ;
 

b) The amount of USD 773,000 in respect of the ICC costs of arbitration, including the amount awarded to the Claimant in the Partial Award on Costs ;
 

c) The amount of EUR 1,069,687.7 representing seventy-five percent (75 %) of the Claimant's legal costs and expenses ;
 

d) [Location 5] interests on all of the foregoing amounts at the commercial rate of five percent (5%) per annum as applicable in Cyprus, from the date of signature of this Final Award until full payment.
 

553. The Arbitral Tribunal rejects all other requests, claims or counterclaims submitted by the Parties."
 

[Translator's note: the decision includes a translation into French of the above]
 

8. On 9 December 2022, Libya applied to this Court to set aside these two arbitral awards, registered under case numbers RG 22/20898 and 22/20899.
 

9. In orders dated 23 November 2023, the case management judge ruled that these applications are admissible and dismissed all of [P]'s requests.

Summary of the dispute

10. In its judgment of 14 May 2024, the court upheld the order regarding the application brought in respect of the final award (RG 22/20899), which was the only order referred to the full panel.
 

11. The pre-merits-hearing phase was ordered closed on 1 April 2025 and an oral hearing took place on 28 April 2025, during which the parties' counsel made oral submissions.
 

II/ PARTIES' SUBMISSIONS AND RELIEF REQUESTED
 

12. Pursuant to Article 1520 of the Civil Procedure Code, Libya requested in its final submissions served electronically on 7 March 2025 that the Court:
 

- SET ASIDE the partial award on jurisdiction rendered in Paris on 28 June 2016, administered by the International Chamber of Commerce (ICC Case No. 20355/MCP) by the arbitral tribunal composed of [I] [G] (arbitrator), [O] [B] (arbitrator) and [C] [W] (presiding arbitrator)
 

- ORDER [P] Holdings Limited to pay the State of Libya EUR 100,000 pursuant to Article 700 of the Civil Procedure Code, together with full costs.
 

13. Pursuant to Article 1520 of the Civil Procedure Code, [P] requested in its final submissions served electronically on 28 March 2025 that the Court:
 

- DISMISS the set-aside application brought by the State of Libya against the arbitral award rendered on 28 June 2016 in ICC case No. 20355/MCP;
 

- DISMISS in full the State of Libya’s claims, applications and all further or contrary submissions;
 

- ORDER the State of Libya to pay [P] HOLDINGS LIMITED EUR 100,000 pursuant to Article 700 of the Civil Procedure Code;
 

- ORDER the State of Libya to pay full costs, payable directly to Mr Jacques BELLICHACH, pursuant to Article 699 of the Civil Procedure Code.
 

14. The Court refers to these submissions for a full statement of the grounds raised by the parties, in accordance with Article 455 of the Civil Procedure Code.
 

III/ REVIEW OF THE CLAIMS
 

A. Setting aside the award
 

III.A.1 The parties' positions
 

15. Libya relies on a single ground for set-aside arising from the arbitral tribunal's lack of jurisdiction. It submits that:
 

- [P] did not accept the offer of arbitration provided for in the BIT since it had submitted its claim for compensation to the Libyan courts before referring the matter to the arbitral tribunal;
 

- Article 9(2) of the BIT contains a fork-in-the-road provision, failure to comply with which constitutes grounds for setting aside arbitral awards pursuant to Article 1520 of the Civil Procedure Code, as established by the jurisprudence of the Paris Court of Appeal and the Court of Cassation;
 

- the investor's election to proceed before the arbitral tribunal pursuant to such a provision is a condition precedent to the State's consent, and thus the provision affects the arbitral tribunal's jurisdiction and not the admissibility of the claim;
 

- the interpretation of Article 9(2) of the BIT in light of the principles set out in the [Location 8] Convention on the Law of Treaties leads to the conclusion that it contains a fork-in-the-road clause that creates an irrevocable election;
 

- interpreting the Treaty in light of the same principles as "any relevant rules of international law applicable" leads to the same conclusion;
 

- the disputes that [P] brought before the Libyan courts and the arbitral tribunal are identical.
 

16. [P] replies as follows:
 

- Libya's complaint does not fall within the grounds for setting aside an award, since it does not relate to the arbitral tribunal's jurisdiction, as it does not challenge [P]'s status as an investor (jurisdiction ratione personae), the fact that the plant constitutes an investment within the meaning of the BIT (jurisdiction ratione materiae), or the date on which the dispute arose (jurisdiction ratione temporis);
 

- an investor's election to proceed before a forum having jurisdiction affects its standing to bring proceedings and is therefore an admissibility objection;
 

- Libya's arguments seek to have the court adopt a broad interpretation of the concept of jurisdiction by incorporating a "ratione voluntatis" jurisdiction criterion that would encompass all conditions, reservations or limitations included by signatory states in the dispute settlement clause of a BIT;
 

- Article 9(2) of the BIT is not a fork-in-the-road provision, since it offers the investor an election, without any indication that such election is irrevocable;
 

- the arbitral tribunal's decision not to characterise Article 9(2) as a fork-in-the-road provision does not violate any principle of international law;
 

- in any event, the disputes that [P] brought before the Libyan courts and the arbitral tribunal are not identical.
 

III.B.2 The Court's analysis
 

17. Article 1520(1) of the Civil Procedure Code provides for set-aside where the arbitral tribunal has wrongly found that it has or does not have jurisdiction.
 

18. In applying this provision, the court hearing the set-aside application must review the arbitral tribunal's jurisdictional decision, whether it found that it had jurisdiction or not, by considering all the legal and factual elements relevant to determining the scope of the arbitration agreement.
 

19. In transnational investment protection matters, the State's consent to arbitration arises from the standing offer to arbitrate set out in a treaty, which is made to a category of investors described in the treaty, for the settlement of disputes relating to investments defined in the treaty.
 

20. The review of the arbitral tribunal's jurisdictional decision does not extend to any review of the merits of the award. The court hearing the set-aside application need not rule on the admissibility of claims or their merits.
 

21. In this case, the arbitral tribunal's jurisdiction was based on the Agreement on the promotion and the reciprocal protection of investments between the Government of the Republic of Cyprus and the Great Socialist People's Libyan Arab Jamahiriya of 30 June 2004, which provides as follows in Article 9, under the heading "Settlement of Disputes between one of the Contracting Parties and Investors of the Other Party":
 

"1. Disputes that may arise between one of the Contracting Parties and an investor of the other Contracting Party with regard to an investment in the sense of the present Agreement shall be notified in writing, including a detailed information, by the investor to the former Contracting Party. As far as possible, the parties concerned shall endeavour to settle these disputes amicably.
 

2. If it is not possible to settle the dispute in this way within six months from the date of the written notification, it shall be submitted, at the choice of the investor concerned to:
 

(a) the competent court of the Contracting Party in whose territory the investment was made; or
 

(b) the Arbitral Tribunal of the International Chamber of Commerce in Paris; or
 

(c) the [Address 2] (ICSID) established by the Convention of 18 March 1965 on the Settlement of Investment Disputes
between States and Nationals of Other States; or
 

(d) the Arbitration Institute of the Arbitral Tribunal of the Chamber of Commerce in Stockholm."
 

22. The terms “investment” and “investor” are defined as follows in Article 1 of the BIT:
 

"a) "Investment":  every kind of assets invested, in connection with economic activities by an investor of one Contracting Party in the territory of the other Contracting Party
in accordance with the laws and regulations of the latter and in particular, although not exclusively, the following:
 

(a) Movable and immovable property and any other property rights such as mortgages, liens, pledges, leases and similar rights.
 

(b) Shares in companies, stocks and debentures of a company or any other form of participation in a company or business enterprise.
 

(c) Claims to money or to any performance under contract having economic value and associated with an investment.
 

(d) Intellectual property rights, technical processes, know-how and goodwill, including copyrights, patents, and rights of inventions, signs, secrets and business names, designs and manufacturing procedures and technical knowledge.
 

(e) Any rights conferred by law or by virtue of a contract, including concessions to search for, cultivate, extract or exploit natural resources.
 

Investments made in the territory of one Contracting Party by any legal entity of that same Contracting Party which is actually owned or controlled by investors of the other
Contracting Party shall likewise be considered as investments of investors of the latter Contracting Party if they have been made in accordance with the laws and regulations of the former Contracting Party.
 

Any change in the form of the assets that are invested or reinvested does not affect their character as investments."
 

b) "'Investor' with regard to either Contracting Party:
 

-- Any natural person having the citizenship of that Contracting party in accordance with its law;
 

-- Any legal person constituted or incorporated in compliance with the law of that Contracting Party and having their seat in the territory of the same Contracting Party;  

who, in compliance with this Agreement, are making investments in the territory of the other Contracting Party."
 

23. The Court notes that the State of Libya does not dispute the arbitral tribunal's jurisdiction based on the existence of an investment and [P]'s status as an investor within the meaning of Article 1 of the BIT.
 

24. Nothing submitted into the record allows the Court to conclude that the requirements attaching to the definitions set out in that Article of the concepts of “investor of a Contracting Party” and “investment”, to which the offer to arbitrate set out in Article 9 necessarily refers, are not met. This is especially the case since the State of Libya has not challenged the nationality of the investor before this Court, even though it was at issue before the arbitral tribunal, and the assets claimed by [P] clearly fall within the scope of Article 1(a), which is particularly broad.
 

25. Therefore, it follows that, by its nature and its subject matter, the dispute between the parties falls within the scope of the offer to arbitrate set out in Article 9 of the BIT.
 

26. The parties disagree as to whether [P] could bring an arbitration proceeding under the BIT after having brought claims against the State of Libya before Libyan courts.
 

27. Where the investor and the Contracting State have not settled the dispute amicably, Article 9(2) provides different options "at the choice of the investor", which allow the investor to submit the dispute before the competent court of the State in whose territory the investment
was made "or" before arbitral fora listed.
 

28. The parties disagree on the characterisation of this provision, which establishes the procedural conditions for implementing the State's consent to arbitrate. But in any event, this provision is relevant to determining whether the claims are admissible, not to the arbitral tribunal's jurisdiction. It is therefore not subject to review by the Court hearing the set-aside application.
 

29. The State of Libya submits that Article 9(2) should be interpreted as providing for different, mutually exclusive options, such that submitting a claim to state courts would preclude any subsequent arbitration claim. Even if this interpretation were accepted, any decision to proceed before such courts would thus preclude the claim from being submitted to the arbitral tribunal, and therefore would render the request for arbitration inadmissible. In this regard, the Court is not bound by the characterisation that the arbitral tribunal used in analysing the objection before it.
 

30. The only ground for set-aside raised by the Libyan State is therefore without merit and must be dismissed, and thus the set-aside application must be dismissed.
 

B. Costs
 

31. The State of Libya shall pay costs, pursuant to Article 696 of the Civil Procedure Code. Its claims for costs under Article 700 of that Code are dismissed.
 

32. It shall also pay to [P] EUR 100,000 pursuant to the same Article.
 

IV/ OPERATIVE PROVISION
 

Operative provision

For these reasons, the Court:
 

1) Dismisses the set-aside application brought by the State of Libya against the arbitral award rendered on 28 June 2016 in ICC case No. 20355/MCP;
 

2) Dismisses the State of Libya's claims in full;
 

3) Recalls that, pursuant to Article 1527 of the Civil Procedure Code, dismissing the set-aside application has the effect of recognising the arbitral award;
 

4) Orders the State of Libya to pay costs, of which Mr Jacques Bellichach may collect directly those he has advanced without having been paid, in accordance with Article 699 of the Civil Procedure Code;
 

5) Orders the State of Libya to pay [P] Holdings Limited one hundred thousand euros (EUR 100,000) pursuant to Article 700 of the Civil Procedure Code.
 

THE CLERK, THE PRESIDING JUDGE,