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GAR 100 - 12th Edition

Baker McKenzie

05 April 2019

Settled a long-running dispute over a nuclear power plant and picked up new instructions from Armenia and investors in Venezuela

People in Who's Who Legal 11
People in Future Leaders 8
Pending cases as counsel 480
Value of pending counsel work US$70 billion
Treaty cases 19
Third-party funded cases 1
Current arbitrator appointments 81 (30 as chair or sole)
Lawyers sitting as arbitrator 34

In the 1980s and 1990s, Baker McKenzie acted for US companies in a large number of claims against Iran at the Iran–United States Claims Tribunal in The Hague, becoming one of the first US law firms to acquire international arbitration expertise in the days before NAFTA and BIT claims. It went on to advise more than a dozen claimants against Iraq at the United Nations Compensation Commission after the first Gulf War. Since then, the firm has developed a thriving investment treaty arbitration practice alongside its commercial arbitration work.

Michael Morkin in Chicago is the current global head of the international arbitration group.  He succeeded Leng Sun Chan SC, who led the group from 2015 until he left to join Essex Court Chambers Duxton in Singapore in 2018. Prior to that, Grant Hanessian in New York and Günter Pickrahn in Frankfurt co-led the group for six years.

Various members of the firm play an active role in the international arbitration community. Hanessian is an alternate US member of the ICC Court, while CIS disputes head Vladimir Khvalei in Moscow is a vice president of the ICC Court, chair of the Russian Arbitration Association, and former vice chair of the IBA arbitration committee. Khvalei is also a member of the working group behind the recently launched Prague Rules.

Meanwhile Habib Al Mulla in the UAE is chairman of the board of the Dubai International Arbitration Centre. Claudia Benavides chairs the ICC’s arbitration and ADR commission in Colombia, while Joaquim Muniz is director of the Rio de Janeiro Bar and head of its arbitration commission, as well as a director of Rio’s largest arbitration centre. 

Another name to know is Andy Moody in London, an energy disputes specialist who joined from Eversheds in 2016.

Network

Few practices have the same global reach as Baker McKenzie’s network of 78 offices in 46 countries. The firm says it has around 300 practitioners globally with experience of international arbitration, encompassing the main financial and arbitration centres and emerging markets. Collectively, the group is fluent in more than 20 languages, including Haitian, Creole, Kazakh and Vietnamese.

Alongside the traditional centres, the arbitration practice has acquired outposts in Almaty, Caracas, Dubai, Ho Chi Minh City, Istanbul, Kuala Lumpur, Lima, Manila and Mexico City, and it is often the first port of call for clients with cross-border disputes in emerging jurisdictions. The firm’s Latin American network is particularly impressive and appears to be bringing in more investment treaty work.

Who uses it?

Air Liquide, AnsaldoBreda, Bombardier, Czech bank CSOB, Dow Chemical, FedEx, GlaxoSmithKline, Hyundai, Lukoil, KPMG, Marriott, Rio Tinto, Samsung, Shell, Siemens, Sime Darby Engineering, Toshiba, Verizon, VTB Bank, Walmart and 3M have all used the firm. Other clients include the British Olympic Association, FC Barcelona and Texan drilling contractor Weatherford.

The firm has also defended governments including Canada, Armenia, Papua New Guinea, Hungary, Mongolia, Turkey and Uzbekistan as well as state-owned entities such as Mexico’s Pemex, Brazil’s Petrobras, Kazakh gas transportation company KazTransGaz and Kyrgyzstan’s national mining company Kyrgyzaltyn.

Track record

In 2017, Baker McKenzie helped Dutch investor Longreef win US$53 million in an ICSID claim against Venezuela concerning the expropriation of a coffee producer. This involved defeating a jurisdictional challenge relating to Venezuela’s termination of its bilateral investment treaty with the Netherlands.

It successfully advised VTB’s Austrian subsidiary and Malta’s FIMBank as claimants in a dispute with UralSib, a bank bailed out by the Russian state. The firm obtained an award concluding that UralSib’s purported write-off of a subordinated loan debt did not discharge its payment obligations. The firm credits the dispute with having helped to change the policy of Russian banking regulators towards subordinated debt.

Lawyers in the Miami office won a US$18 million award for Australian infrastructure client Cardno after persuading an ICDR tribunal that the client’s Ecuadorean business partners had engaged in a “far-reaching and intricate bribery scheme” to secure government contracts. The award led to criminal complaints against Ecuador’s then vice president and a former energy minister.

It helped Canada defend a NAFTA award against a US court challenge by US company Mesa Power, which had sought to revive a failed US$600 million claim over the renewable energy policies of the Ontario government.

The Toronto office did stellar work for Kyrgyzaltyn in fending off attempts to seize its Canadian assets. Four different creditors of Kyrgyzstan had sought to enforce awards totalling US$166 million by seizing the state entity’s shares in a Canadian mining company. The dispute ended in 2017 with a Canadian Supreme Court ruling dismissing appeals by two of the creditors and ordering the return of funds the state entity had paid into escrow. The dispute has also generated important case law on service requirements when suing foreign states.

The firm has previously had good results for investors against Kyrgyzstan, helping Kazakh private equity group Visor Capital favourably settle a US$700 million ICSID claim  in 2015 over the country’s second-largest gold deposit.

For Uzbekistan, Baker McKenzie secured a precedent-setting award in 2009 dismissing a wheat trader’s claim at the jurisdictional stage. The firm has also successfully defended Turkey against two treaty claims from Polish investors; and Papua New Guinea in an ICDR arbitration seated in New York.

A team led by Hanessian helped Petrobras obtain a US$200 million award against former Halliburton subsidiary KBR in 2011 in a dispute over faulty oil platforms. The parties settled a year later.

Baker McKenzie brought in a great result for Weatherford in 2014, winning a US$45 million award against Dubai’s Gulf Oil and Gas in an ICC dispute over the development of a gas field in Turkmenistan.

In Prague, Martin Hrodek led a team that obtained an US$85 million ICC award for Czech bank CSOB in 2011 against the Czech Republic. It was one of the first arbitrations to consider the application of state aid laws to a bank bailout.

Recent events

The firm saw an end to a decade-long ICC arbitration worth €6.2 billion in which it had been representing Siemens. The parties agreed a settlement of their dispute over a nuclear power plant in Finland in 2018, with Siemens’ consortium partner Areva paying €450 million to Finnish power company TVO.

There were mixed results in an ICSID claim the firm had been pursuing against Croatia on behalf of Austrian businessman Georg Gavrilović and his sausage company. A tribunal found the state liable for the expropriation of the claimants’ commercial property but only awarded €3.26 million in damages out of the roughly €200 million they had sought.

The Caracas office was instructed by Spanish farming conglomerate Agroinsumos to bring an ICSID claim against Venezuela concenring the expropriation of a food and agricultural business.

Armenia has retained a team in New York to defend against a US$150 million ICSID claim by a Dubai investment company and its American CEO. The case concerns concessions to build and operate strategically important road and rail links to transport oil from Iran.

The firm continues to represent KazTransGas in a US$180 million claim against Georgia under the Energy Charter Treaty; and three Indian clients in a US$40 million treaty claim against Bosnia-Herzegovina relating to an insurance privatisation. Russian construction company Manolium has also retained it for a potential treaty claim against Belarus.

In Dubai, Habib Al Mulla successfully defended one of Sime Darby Engineering, part of one of Malaysia’s largest conglomerates, against a DIAC claim by an Abu Dhabi company. A tribunal rejected claims that the client breached an agency agreement by refusing to participate in certain energy projects in the United Arab Emirates. In other DIAC proceedings, Al Mulla has been defending a collapsed Dubai private equity group in a claim by low-cost airline Air Arabia.

There were a number of people moves in 2018.Besides Leng Sun Chan SC’s move to chambers in Singapore, the head of the California arbitration practice, Maria Chedid, left for her old firm, Arnold & Porter. The former head of Baker McKenzie’s Madrid office, José María Alonso, left to set up an independent practice, while partner Charlotte Bijlani in Dubai moved to Watson Farley & Williams.

Partner Luis O’Naghten, a key figure in the group’s Latin America work, left the Miami office in early 2019 for Hughes Hubbard & Reed; while partner Teddy Baldwin in the DC office moved to Steptoe & Johnson around the same time.

There were also lateral hires at the partner level in 2018. Former Hogan Lovells counsel Andrew Mackenzie joined in Dubai as head of arbitration for the UAE. Construction disputes specialist Janice Tay arrived in Kuala Lumpur from Skrine; Honghuan Liu in Beijing joined from Jun He; and Francesco Maruffi in Milan from Simmons & Simmons. 

In 2018, Baker McKenzie also promoted new partners Luca Beffa in Geneva, Nicolai Behr in Munich, Cristina Mejia in Bogota, Tjen Wee Wong in Singapore, Anton Mikel in Riyadh, and Ahmed Shafey in Toronto. 

Client comment

A client in an arbitration with an African state describes the firm as a “fantastic asset in managing a very complex difficult situation” also noting the “richness of the multicultural composition of their team” permitting them “to widen the approach to the case”. She describes Paris-based partner Eric Borysewicz as a “fantastic lawyer” and a “superb team leader”. 

“Their dedication to the case is what we appreciate the most,” says Laura Anguera Armengol, director of legal services at football team FC Barcelona, which used the firm for an arbitration worth almost €40 million. She also praises “their dedication to the preparation of the witnesses and the hearing”.

Michael McNicholas, general counsel at Visor, says the firm was “very responsive” in its work on the Kyrgyzstan case mentioned above. They gave “solid legal advice” and “put together a strong cross-border litigation team”, he adds.

Insight

Reviews

Regional analysis from arbitrators around the globe, focussing on key developments in specific industry areas and jurisdictions.

Meaar reviews banner 1024 300 230x67

The Middle Eastern and African Arbitration Review 2019

Highlights

CRCICA Overview

Ismail Selim and Dalia Hussein

The Cairo Regional Centre for International Commercial Arbitration (CRCICA)

DIFC-LCIA Arbitration Overview

Alec Emmerson

DIFC Arbitration Institute (DAI)

Robert Stephen, Matthew Harley and Katy Hacking

DIFC-LCIA Arbitration Centre