Venezuelan businessman José Alejandro Hernández Contreras has filed before the International Centre for Settlement of Investment Disputes (ICSIDI) a new request for the institution under the ICSID Additional Facility of arbitration proceedings against Costa Rica. It follows the suspension decision made in March this year and the prior approval of the General Secretary of the ICSID.

Under the ICSID Additional Facility, a claim can be submitted to arbitration when a party or investor, but not both, is part of the ICSID Convention.

The tribunal of the previous arbitration proceedings, initiated before ICSID in August 2020, and formed by the Chilean Felipe Bulnes (presiding arbitrator by the agreement of the parties); the American Carlos F. Concepción as co-arbitrator nominated by the claimant; and the Mexican Hugo Perezcano as co-arbitrator nominated by the defendant, registered the discontinuance of the proceeding pursuant to Article 50 of the ICSID Arbitration (Additional Facility) Rules:

“Discontinuance at the Request of a Party

If a party requests the discontinuance of the proceeding, the Tribunal, or the Secretary-General if the Tribunal has not yet been constituted, shall, in an order, fix a time limit within which the other party may state whether it opposes the discontinuance. If no objection is made in writing within the time limit, the Tribunal, or if appropriate, the Secretary-General, shall in an order take note of the discontinuance of the proceeding.”

The origin of the arbitration proceeding

The arbitration, between Alejandro Hernández Contreras and Costa Rica, arose out of the non-renewal by the Costa Rican Institute of Electricity (ICE) of a contract with the claimant’s telecommunications company, V-NET. The businessman claims $25 million.

The conflict arises out of alleged irregularities made by ICE in relation to the telecommunication contract (KOLBI Telecommunications Operator) entered into with V-NET Communications, whose majority shareholder and controller is Alejandro Hernández Contreras.

Alejandro Hernández Contreras is represented by ReedSmith.

The Republic of Costa Rica is represented by a team from the Foreign Affairs Ministry.

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