• Search

GAR 100 - 12th Edition

Freshfields Bruckhaus Deringer

05 April 2019

After a 12-year battle the firm brought home a record-breaking US$8.7 billion award for ConocoPhillips against Venezuela – along with other victories against PDVSA and Ecuador

People in Who's Who Legal 16
People in Future Leaders 21
Pending cases as counsel 158
Value of pending counsel work US$153 billion
Treaty cases 44
Third-party funded cases 11
Current arbitrator appointments 19 (12 as chair or sole)
Lawyers sitting as arbitrator 16

Freshfields Bruckhaus Deringer topped every edition of the GAR 30 between 2008 and 2014 and more recently has remained among the top two or three firms in the ranking.

Its success stems partly from having been among the first to enter the field. Back in the late 1970s, two of the firm’s London partners, Alan Redfern and Martin Hunter, found themselves representing Kuwait in an arbitration with US company Aminoil over the termination of an oil concession. It remains a leading public international law case.

The experience convinced the two men to pitch the idea that the firm treat international arbitration as a discrete skill set, fenced off from litigation. That in turn led them to propose to Jan Paulsson (a rising star of the Paris arbitration world whom they’d met while working on Aminoil) that he join their project. A London–Paris connection would make sense, they reasoned, as Paris was where the action was.

So before most firms even had one partner that “specialised” in this area, Freshfields had three – in charge of their own stand-alone international arbitration group.

The next 10 years saw strong growth, fuelled by a string of major cases (international arbitration and public international law) and by the gravitational pull of Paulsson’s reputation, which attracted young lawyers from around the world curious to try this new area of law. Freshfields became an unofficial university for international arbitration (ask many of the big names at other practices where they got their start and you’ll hear something like “in Paris, working for Jan”).

So by the late 1990s, the firm had a strong team led by Paulsson in Paris, Nigel Rawding in London and Lucy Reed in New York.

From that time on, a generation of homegrown international arbitration partners emerged. Initially very Paris-centric, the practice began to relocate some of its newer names to the US, the UK, the Middle East and Asia. By 2012, the firm built a network of international arbitration teams dotted around the world.

At this point, Paulsson was well past the Freshfields retirement age. In 2013, it was agreed that the time was right for him to part company from the practice that had developed around him. (He set up his own shop, Three Crowns, where he was joined by his former Freshfields protégés Constantine Partasides QC and Georgios Petrochilos.)

Nigel Blackaby in Washington, DC, replaced Paulsson as global co-chair of the international arbitration group in 2014. He has been with the firm for more than 20 years and has been at the forefront of its Latin America-related work.

Following Reed’s retirement in 2016, Blackaby steered the group alone before Boris Kasolowsky in Frankfurt was named as the other co-chair in 2018. Kasolowsky has also been with the firm for two decades and previously headed its disputes work in Germany, Austria and Central and Eastern Europe.

Noiana Marigo in New York meanwhile took over Blackaby’s role as head of the US practice in 2019.

Sylvia Noury took over from Rawding as head of the London practice in 2018. The London office is also home to Will Thomas, former head of arbitration at Eversheds, who joined in 2016.  

Noah Rubins has taken over from Peter Turner QC as head of the Paris practice. The head of the public international law group, Ben Juratowitch QC, is also based in Paris.

Network

The main locations for the international arbitration team are London, Paris, various German and Austrian offices, New York, Dubai, Hong Kong, Singapore, Tokyo and Washington, DC. There are also people in Madrid, Milan, Moscow, Rome and Amsterdam.

Who uses it?

The client list is a who’s who of states and global corporations. Of late, a lot have been energy companies. One reason for this is gas-pricing arbitrations, a field in which the practice was one of the first to build a name.

Clients (current and past) include Abertis, Alpiq, América Movíl, Anglo American, AstraZeneca, BG Group, Boeing Satellite Systems, BP, China National Offshore Oil Corporation, CMS Energy, ConocoPhillips, Credit Suisse, Crescent Petroleum, Danone Asia, Deutsche Bank, Deutsche Telekom, Dubailand, Electrabel, Eni, EVN, Glencore, Maersk Oil, Marubeni Corporation, Mitsubishi Heavy Industries, MTN Group, National Grid, Repsol, Rurelec, Shell, Siemens, Stans Energy, Tata Group, Techint, Tenaris, Tiffany, Total and Tullow Oil.

The practice also represents governments. Notable states that have instructed it include Cambodia (for the state’s first ICSID matter), Chile, Guatemala, Grenada, Italy, Kenya, Romania, St Lucia, South Africa (on a case relating to black-empowerment policies), South Korea, Tanzania, Turkey and Vietnam.

Lately it’s also acted for state entities including Brazil’s national oil and gas company Petrobras and Oman’s State General Reserve Fund.

Track record

Freshfields certainly has an illustrious record that began during the Paulsson era. A few of its greatest hits are:

  • the Megafon dispute, in which Freshfields turned around an initial loss in a Russian telecoms “war” into a much bigger victory, leading to the unseating of a Russian minister amid corruption allegations;
  • multiple wins for investors against Argentina in the wake of its financial crisis;
  • acting in the first investment treaty claim by a Japanese investor (Nomura v Czech Republic), obtaining a US$236 million settlement for the client;
  • the World Duty Free case at ICSID, in which Freshfields absolved Kenya from liability despite evidence that the country’s then president had received a bribe; and
  • defending Turkey in three ICSID claims under the Energy Charter Treaty worth a combined US$17 billion, including one that resulted in a US$25 million costs award for the client.

More recently the team has:

  • won a series of investment treaty awards against Venezuela, including US$1.4 billion for distressed Canadian mining company Crystallex, US$1.2 billion for Rusoro Mining, US$338 million for steel pipe producer Tenaris, and US$98 million for British meat producer Vestey;
  • helped Repsol settle its YPF expropriation claim against Argentina for US$5 billion;
  • obtained a US$2 billion award for ExxonMobil and Shell in a dispute with the Nigerian National Petroleum Corporation;
  • won awards worth a combined US$1.5 billion against Egypt and its state entities in cases relating to the termination of gas supplies to Israel after the Arab Spring;
  • secured a US$1.98 billion LCIA award for the UAE’s Crescent Petroleum and Dana Gas, leading to a settlement with the Kurdistan regional government of Iraq over two gas fields;
  • negotiated a US$337 million settlement for ConocoPhillips in a dispute with Ecuador over a 99% levy on windfall profits;
  • defeated a US$300 million claim against Cambodia, winning the state over US$5 million in costs;
  • successfully defended St Lucia from a US$200 million ICSID claim; and
  • won the only investment treaty matter ever heard by the US Supreme Court (BG v Argentina).

Recent events

The practice has continued to achieve remarkable results, particularly in Latin America-related work. After a fraught 12-year ICSID proceeding, the firm (together with Three Crowns) obtained a stunning US$8.7 billion award for Conoco in 2019 over the expropriation of three oil projects by Venezuela. It is thought to be the largest ICSID award ever rendered. Freshfields is now helping Conoco to enforce the award in the US courts.

The year before, Freshfields also helped Conoco obtain a US$2 billion ICC award against Venezuela’s national oil and gas company PDVSA in relation to two of the same projects. After Conoco targeted PDVSA’s operations in the Dutch Caribbean with attachment measures, the state entity agreed in August 2018 to settle the award and paid a first instalment of US$345 million in cash and commodities soon after.

After helping Tenaris win two ICSID awards worth a combined US$338 million, Freshfields successfully defended them against an annulment bid by Venezuela. The firm also obtained a US$42 million award for a European polymer producer against the state and persuaded an ICSID committee to lift a stay of enforcement of the award.

Not every case against Venezuela panned out, however. In 2019, client Anglo American saw its US$400 million ICSID claim against the state dismissed. The case concerned assets relating to a nickel project.

Freshfields continues to advise in a number of other matters against Venezuela, including a billion-dollar treaty claim brought by Spanish-Venezuelan dual nationals over the expropriation of their food distribution business, and a pair of smaller claims by other members of the same family. The firm is also acting for a Peruvian entrepreneur in an ICSID claim against the state concerning the seizure of his telecoms company.

Away from its Venezuela work, the firm secured a US$515 million award for a former subsidiary of Brazil’s Petrobras and its partners against Ecuador in a dispute over the early termination of production-sharing contracts. The case was heard at the Permanent Court of Arbitration in The Hague.

It achieved some good settlements for clients against Argentina. It helped France’s Total receive a payout of US$210 million in bonds after defeating the state’s attempt to annul an ICSID award reportedly worth more than US$300 million. It also helped Spanish construction company Abertis to settle a US$1.2 billion ICSID claim against Argentina relating to two toll highways near Buenos Aires.

Chinese state-owned client Beijing Urban Construction also settled an ICSID claim against Yemen over a project to build a new airport terminal in Sana’a in 2018, following a jurisdictional ruling in the company’s favour.

The firm has done amazing work for Egyptian company East Mediterranean Gas (EMG) and its investors in a set of cases relating to Egypt’s repudiation of a deal to supply gas to Israel following attacks on a pipeline in the wake of the Arab Spring. It has obtained an ICC award worth US$324 million and a Cairo centre award worth US$1.3 billion, with damages awards awaited in two related treaty claims that have already cleared the liability phase. Media reports have recently indicated the dispute has settled, though this has not stopped EMG from applying to enforce the ICC award in the US courts.

There was a victory for Albania in another ICSID case, when a tribunal declined jurisdiction over claims relating to the state’s failure to honour financial instruments issued during its transition from Communism. The BVI claimant was found not to have a protected investment. Freshfields’ Frankfurt and Vienna offices handled the case.

In other matters, it is advising a Singapore affiliate of Israel’s IC Power in a potential US$150 million claim against Peru concerning an investment in the electricity generation sector.

Mining companies Eco Oro and Glencore and Mexico’s América Móvil are using it for ICSID claims against Colombia.

Spain’s Banco Bilbao has retained the firm for a BIT claim against Bolivia over the nationalisation of the country’s pension system. And in another instruction from Kenya, it is defending an US$340 million ICSID claim by WalAm Energy over a geothermal energy licence.

It is also acting for investors in two of the numerous Energy Charter Treaty claims against Spain concerning reforms to the country’s renewable energy sector – bringing claims on behalf of Japanese investor Eurus Energy of the Toyota Group; and Sun-Flower Olmeda. 

Panama-registered aviation holding company Larah has instructed Freshfields as it threatens an investment treaty claim against Uruguay over the renationalisation of an airline. The case reunites the firm with Larah’s owner Tenor Capital Management, the private equity group that funded Crystallex’s ICSID claim against Venezuela.

On the commercial side, Freshfields successfully defended Austrian energy company RAG from an ICC claim brought by Energie Steiermark over a natural gas storage agreement.

It also teamed up with Shearman & Sterling and local counsel in Lahore to help nine power producers win a US$130 million LCIA award against a Pakistani state-owned electricity distributor for failing to comply with an earlier expert determination. The team later obtained an English court injunction to prevent the state entity from challenging the award in the courts of Lahore.

Freshfields’ extensive alliances with international organisations for pro bono work include recently advising the World Bank in preparing a global of study on gender inequality by analysing legislation and policy in four Middle Eastern countries.

Brian King in the New York office retired after 20 years to teach at the New York University School of Law and practise as an independent arbitrator.

Reza Mohtashami QC left the London team to join former colleagues at Three Crowns.

The managing partner of Freshfields’ Paris office, Elie Kleiman, left the firm to join Jones Day in 2018. Paris counsel Shaparak Saleh left to join Teynier Pic as a partner.

Moritz Keller, the German head of the practice in Vienna, joined Clifford Chance in Frankfurt. Gunther Horvath left the Vienna office after 40 years to join the supervisory board at Porsche. Partners Christian Duve in Frankfurt and Hub Harmeling in Amsterdam also left the firm.

Thomas Walsh joined as special counsel in New York from Sullivan & Cromwell while Joaquin Terceño was hired as counsel in Tokyo.

Leilah Bruton, Jonathan Wong, Alexey Yadykin and Natalia Zibibbo were promoted to counsel in London, Hong Kong, Moscow and New York respectively.

Client comment

Jader Yubran of Glencore’s Colombian mining subsidiary Prodeco Group, who is working with Freshfields on a US$350 million ICSID claim against Colombia, says: “The performance of every single member of Freshfields team on this matter has been outstanding and their behaviour has also been remarkable from a personal, professional and academic standpoints.”

He says Blackaby “stands out as a very well-experienced and well-reputed team leader” while partner Caroline Richard and her team have shown “remarkable and astonishing experience” in the handling of the case.

Adrian Woodcock, legal director at Oman’s State General Reserve Fund, engaged Freshfields in a “critical” claim against Bulgaria. He says Boris Kasolowsky and Rob Whitener “remained calm and professional” and the advice was given in a “timely manner keeping the project on track”.

Insight

Reviews

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

Gcr handbook devices 1024 230x67

The Asia-Pacific Arbitration Review 2020

Highlights

DCF: Gold Standard or Fool’s Gold?

Montek Mayal and Alexander Davie

FTI Consulting

Distinction and Connection: Hong Kong and Mainland China, a View from the HKIAC

Sarah Grimmer

Hong Kong International Arbitration Centre