In the following case, the Second Circuit harmonizes the ICSID Convention and its enabling statutes, 22 U.S.C. Section 1650a, with the Foreign Sovereign Immunities Act (FSIA), 28 U.S.C. Sections 1330, 1391(f), 1441(d), 1602-1611.
Between 1962 and 1965, the World Bank spearheaded the development of the ICSID Convention, a multilateral treaty aimed at encouraging and facilitating private foreign investment in developing countries. The Convention established an international organization, the International Centre for Settlement of Investment Disputes, based in Washington, D.C. (the "Centre" or "ICSID"). Under ICSID, arbitration panels may be convened to adjudicate disputes between international investors and host governments in "Contracting States" (countries who have adopted the ICSID Convention). The Centre convenes arbitral tribunals upon request by either a member state or a national of a member state. At the conclusion of a proceeding, the panels issue written awards that address "every question submitted to the Tribunal," and "state the reasons upon which [the award] is based." ICSID Convention Art. 48. Note that Article 53 of the Convention provides that a party dissatisfied with an award may challenge it on various grounds, but may do so only through proceedings at the Centre and not collaterally in the courts of member states. The Convention envisions that participating sovereign states retain their sovereign immunity.
In August 1966, after ratifying the Convention, Congress adopted legislation to implement it. The Sovereign Immunities Act of 1976 (FSIA), Pub. L. 94-583, 90 Stat. 2891 (1976), governs the jurisdiction of United States courts over actions against foreign sovereigns. The FSIA provides that, "[s]ubject to existing international agreements to which the United States is a party," foreign sovereigns "shall be immune from the jurisdiction of the courts of the United States and of the States" except as provided by one of the FSIA's exceptions to jurisdictional immunity. Federal courts, when presented with requests to enter federal judgments upon ICSID awards against foreign sovereigns, have adopted various approaches to "recognition" and "enforcement" of ICSID awards. There are two distinct approaches. The first approach permits entry of judgment on an ICSID award through an ex parte proceedings like the one at issue here. The district courts adopting this approach interpret the Convention and Section 1650a to require some sort of summary procedure to recognize the ICSID award, and generally look to state law for the appropriate procedure. The second approach requires award-creditors to pursue a plenary action in compliance with the FSIA's personal jurisdiction, service, and venue requirements in order to enforce an ICSID award.
Here, the parties do not dispute the basic facts giving rise to the ICSID panel award. During the 1990s, Mobil (acting through subsidiaries) invested in two oil development ventures in Venezuela involving the government that went sour. On October 9, 2014, after lengthy arbitral proceedings in which both Mobil and Venezuela participated, a panel of ICSID arbitrators issued a unanimous award in Mobil's favor. The day after the ICSID panel announced the Award, Mobil filed an ex parte petition in the Southern District of New...