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GAR 100 - 10th Edition

Pérez Alati Grondona Benites Arntsen & Martínez de Hoz

06 March 2017

The Buenos Aires firm continues to get great results at ICSID

People in Who’s Who Legal 1
Pending cases as counsel 5
Value of pending counsel work US$2.8 billion
Treaty cases 2

One of Argentina’s largest law firms, Pérez Alati was among the first in the country to gain experience in investment treaty work: in the late 1990s, it defended the Argentine government in the first Vivendi water concession case (one of the few ICSID cases against Argentina that don’t relate to its 2001–2002 financial crisis).

Since that crisis, the firm is more commonly seen acting against its home government. It has become one of the first ports of call for aggrieved investors in the areas of oil and gas, power, reinsurance and sovereign debt. The firm often works alongside international firms such as King & Spalding, White & Case, Jones Day and Vinson & Elkins.

The practice revolves around José Alfredo Martínez de Hoz Jr, who is also known as an energy lawyer. He is a member of the ICC Court and sits as an arbitrator. Partner Guillermo Quiñoa focuses on commercial arbitration.

Who uses it?

It serves a number of international energy companies for both investment and commercial matters, with big names including BP, ExxonMobil, Occidental, Pan American Energy, CMS Energy, Repsol, Sinopec, Total and Endesa.

Despite its reputation for assisting investors against Argentina, it has also advised Argentine state oil and gas operator YPF in a billion-dollar dispute over gas exports (see ‘Recent Events’).

Chevron has also turned to the firm in connection with its efforts to resist global enforcement of a US$9 billion Ecuadorean court judgment relating to environmental pollution in the Amazon.

Track record

The firm’s ICSID results are impressive. As co-counsel with White & Case, Pérez Alati represented 60,000 Italian investors in defaulted Argentine sovereign bonds in a groundbreaking US$2.5 billion investment treaty claim against Argentina – described as ICSID’s first “mass claim”.

The case cleared the jurisdictional stage in 2011, with a landmark decision holding that sovereign bonds do benefit from treaty protection even if acquired on the secondary market; and that additional consent from the state wasn’t required to allow multiparty proceedings. A new centre-right government in Argentina under President Mauricio Macri ultimately settled the case before it reached a final award – making a cash payment of US$1.35 billion to the claimants in 2016.

Another successful ICSID case saw the firm pair up with King & Spalding to represent US energy company El Paso. The client obtained a US$73 million award against Argentina in 2011, which survived an annulment proceeding three years later. In 2016, the Macri government settled the award at a 25% discount with a payout of bonds to a Delaware entity that had acquired the rights to the award.   

Recent events

In another co-counsel collaboration – this time with Vinson & Elkins – the firm helped ExxonMobil obtain a US$220 million ICSID award against Argentina in February 2016. The award is now subject to annulment proceedings.

A long-running case for client YPF saw further developments in 2016, with the state oil and gas operator agreeing to pay US$60 million to a unit of US energy group AES to satisfy an ICC award worth more than three times that amount. In return, AES has abandoned efforts to enforce the award in the US courts.

Pérez Alati had already persuaded a Buenos Aires appeal court to overturn the award, which also required YPF to pay US$319 million to Argentine gas transportation company TGM. The dispute, which relates to the curtailment of gas exports to Brazil in the wake of Argentina’s 2004 energy crisis, had originally seen claims of around US$1.4 billion brought against YPF. Pérez Alati was instructed back when YPF was still majority owned by Spain’s Repsol but stayed on the case even after the company was nationalised in 2012.

Client comment

In-house Endesa lawyer José María Fesser tells GAR: “Pérez Alati has a huge reputation in Argentina and their lawyers offer solid knowledge, especially about the Argentine energy sector, commercial law, regulation and labour law. They’ve had our confidence for many years.” Another client, Diego Alvarez-Blanco of Ultrapetrol Group, commends the group’s “excellence, level of detail and value for money”.