KINGSTON, Jamaica, CMC – Jamaican business mogul Michael Lee-Chin has been awarded more than US$43 million in an investment dispute with the Dominican Republic.
Lee-Chin obtained a Final Award from a UNCITRAL Arbitral Tribunal in the case that involved issues of first impression under the Caricom-DR Free Trade Agreement (Treaty).
Lee-Chin had brought the claim against the Dominican Republic under the Treaty about his interest in Lajun Corporation SA. This Dominican company held a long-term concession contract to manage a landfill in Santo Domingo.
The concession was managed by Lee-Chin’s son, Adrian Christopher Lee-Chin, who served as Lajun’s general manager.
In 2017, the Dominican Republic took military control of the landfill and brought local actions to nullify and terminate the concession based on an alleged environmental emergency.
Lee-Chin initiated investment arbitration against the Dominican Republic because he alleged the state’s multiple violations of the Treaty, which included various arbitrary acts intended to force him to operate the landfill without receiving a fair tipping fee.
After more than five years of arbitral proceedings, multiple rounds of substantive briefs (jurisdictional and merits), two document production phases, a two-day jurisdictional hearing, a six-day final hearing on the merits, and significant post-hearing briefings, the Arbitral Tribunal issued its Final Award in favor of Lee-Chin.
In the Final Award, the Tribunal found that the Dominican Republic violated its obligations under the Treaty regarding expropriation and fair and equitable treatment and breached the Treaty’s umbrella clause. In reparation for these violations, the Arbitral Tribunal ordered the Dominican Republic to pay Lee-Chin over US$43.59 million, plus interest.
Agreeing with the arguments made by Lee-Chin, the Tribunal rejected all remaining jurisdictional objections filed by the Dominican Republic. It held that “the termination of the Concession Agreement was part of a larger effort by the State to eject Claimant from the operation of the investment.”
The Tribunal further found that “no pattern of reasonableness or plausible justifications may be discerned in [the Dominican Republic’s] changing attitudes throughout the investment.”
Consequently, the Arbitral Tribunal concluded that the Dominican Republic “must compensate Claimant for the damages it caused as a result of violating its obligations under the terms of the Treaty.”
After reviewing the Final Award, Lee-Chin said he “was very pleased with the result and was finally vindicated.”
He added that he “expects the Dominican Republic to immediately satisfy the Final Award and evidence to the investor community, including all Jamaican investors, that the Dominican Republic once found liable honors its international obligations.”
and then 