Lao Holdings NV v Government of the Lao People's Democratic Republic

JurisdictionSingapore
CourtHigh Court (Singapore)
JudgeQuentin Loh JAD,Sir Vivian Ramsey IJ,Douglas Jones IJ
Judgment Date10 September 2021
Docket NumberOriginating Summonses Nos 5 and 6 of 2020

[2021] SGHC(I) 10

Singapore International Commercial Court

Quentin Loh JAD, Sir Vivian Ramsey IJ and Douglas Jones IJ

Originating Summonses Nos 5 and 6 of 2020

Lao Holdings NV
and
Government of the Lao People's Democratic Republic and another matter

Lin Weiqi Wendy, Chong Wan Yee Monica (Zhang Wanyu), Ling Jia Yu (Lin Jiayu) andHo Yi Jie (WongPartnership LLP) for the plaintiffs;

Cavinder Bull SC, Lim Gerui, Tan Yuan Kheng (Chen Yuanqing), Lim Qiu Yi ReginaandTan Sih Si (Chen Shisi) (Drew & Napier LLC) for the defendant.

Case(s) referred to

AAY v AAZ [2011] 1 SLR 1093 (refd)

ABB AG v Hochtief Airport GmbH [2006] 2 Lloyd's Rep 1 (refd)

AJU v AJT [2011] 4 SLR 739 (folld)

AKN v ALC [2015] 3 SLR 488 (refd)

AMZ v AXX [2016] 1 SLR 549 (folld)

ANC Holdings Pte Ltd v Bina Puri Holdings Bhd [2013] 3 SLR 666 (refd)

ASG v ASH [2016] 5 SLR 54 (refd)

Atkins Ltd v The Secretary of State for Transport [2013] EWHC 139 (TCC) (refd)

Bariven SA v Wells Ultimate Service LLC ECLI:NL:GHDHA:2019:2677 (refd)

Belokon v Kyrgyzstan RG No 15/01650 (21 February 2017) (Paris Court of Appeals) (refd)

BLC v BLB [2014] 4 SLR 79 (refd)

CBP v CBS [2020] SGHC 23 (refd)

Chai Cher Watt v SDL Technologies Pte Ltd [2012] 1 SLR 152 (folld)

China Machine New Energy Corp v Jaguar Energy Guatemala LLC [2020] 1 SLR 695 (folld)

Coal & Oil Co LLC v GHCL Ltd [2015] 3 SLR 154 (refd)

CRW Joint Operation v PT Perusahaan Gas Negara (Persero) TBK [2011] 4 SLR 305 (refd)

EFT Holdings, Inc v Marinteknik Shipbuilders (S) Pte Ltd [2014] 1 SLR 860 (folld)

GD Midea Air Conditioning Equipment Co Ltd v Tornado Consumer Goods Ltd [2018] 4 SLR 271 (distd)

Government of the Lao People's Democratic Republic v Sanum Investments Ltd [2015] 2 SLR 322 (refd)

Gustav F W Hamester GmbH & Co KG v Republic of Ghana ICSID Case No ARB/07/24 (refd)

Inceysa Vallisoletana SL v Republic of El Salvador ICSID Case No ARB/03/26 (refd)

JVL Agro Industries Ltd v Agritrade International Pte Ltd [2016] 4 SLR 768 (refd)

L W Infrastructure Pte Ltd v Lim Chin San Contractors Pte Ltd [2013] 1 SLR 125 (folld)

Lao Holdings NV v Lao People's Democratic Republic ICSID Case No ARB(AF)/16/2 (refd)

Metal-Tech Ltd v Uzbekistan ICSID Case No ARB/10/3 (refd)

Motor Oil Hellas (Corinth) Refineries SA v Shipping Corporation of India (The Kanchenjunga) [1990] 1 Lloyd's Rep 391 (folld)

MS First Capital Insurance Ltd v Smart Automobile Pte Ltd [2020] SGHC 256 (refd)

Oxley Consortium Pte Ltd v Geetex Enterprises Singapore (Pte) Ltd [2020] SGHC 235 (refd)

Pacific Recreation Pte Ltd v S Y Technology Inc [2008] 2 SLR(R) 491; [2008] 2 SLR 491 (refd)

PT Asuransi Jasa Indonesia (Persero) v Dexia Bank SA [2007] 1 SLR(R) 597; [2007] 1 SLR 597 (refd)

PT First Media TBK v Astro Nusantara International BV [2014] 1 SLR 372 (folld)

Quarella SpA v Scelta Marble Australia Pty Ltd [2012] 4 SLR 1057 (folld)

Sanum Investments Ltd v Government of the Lao People's Democratic Republic [2016] 5 SLR 536 (refd)

Sanum Investments Ltd v Lao People's Democratic Republic ICSID Case No ADHOC/17/1 (refd)

Sanum Investments Ltd v ST Group Co, Ltd [2020] 3 SLR 225 (refd)

Sembcorp Marine Ltd v PPL Holdings Pte Ltd [2013] 4 SLR 193 (refd)

Soh Beng Tee & Co Pte Ltd v Fairmount Development Pte Ltd [2007] 3 SLR(R) 86; [2007] 3 SLR 86 (folld)

Soleimany v Soleimany [1999] QB 785 (refd)

ST Group Co Ltd v Sanum Investments Ltd [2020] 1 SLR 1 (refd)

Sui Southern Gas Co Ltd v Habibullah Coastal Power Co (Pte) Ltd [2010] 3 SLR 1 (refd)

Tjong Very Sumito v Antig Investments Pte Ltd [2009] 4 SLR(R) 732; [2009] 4 SLR 732 (refd)

TMM Division Maritima SA de CV v Pacific Richfield Marine Pte Ltd [2013] 4 SLR 972 (refd)

Triulzi Cesare SRL v Xinyi Group (Glass) Co Ltd [2015] 1 SLR 114 (folld)

Tuitiongenius Pte Ltd v Toh Yew Keat [2021] 1 SLR 231 (refd)

Vivendi v Argentina ICSID Case No ARB(AF)/12/6 (refd)

Webber v Seltzer [2005] Can LII 3209 (refd)

Westacre Investments Inc v Jugoimport-SPDR Holding Co Ltd [1999] QB 740, HC (Eng) (refd)

Westacre Investments Inc v Jugoimport-SPDR Holding Co Ltd [2000] QB 288, CA (Eng) (refd)

World Duty Free Co Ltd v Republic of Kenya ICSID Case No ARB/00/7 (refd)

Y.E.S. F&B Group Pte Ltd v Soup Restaurant Singapore Pte Ltd [2015] 5 SLR 1187 (refd)

Zermalt Holdings SA v Nu-Life Upholstery Repairs Ltd [1985] 2 EGLR 14 (refd)

Zurich Insurance (Singapore) Pte Ltd v B-Gold Interior Design & Construction Pte Ltd [2008] 3 SLR(R) 1029; [2008] 3 SLR 1029 (refd)

Legislation referred to

International Arbitration Act (Cap 143A, 2002 Rev Ed) ss 3(1), 10, 10(3), 19B, 19B(1), 24, 24(b)

Arbitration — Award — Recourse against award —Setting aside —Arbitral tribunal considering allegations relating to three projects that were not submitted to it —Whether arbitral tribunal acted in excess of jurisdiction —Article 34(2)(a)(iii) UNCITRAL Model Law on International Commercial Arbitration

Arbitration — Award — Recourse against award —Setting aside —Arbitral tribunals admitting additional evidence relating to bribery, corruption and fraud in revived proceedings —Whether arbitral procedure was not in accordance with agreement of parties —Article 34(2)(a)(iv) UNCITRAL Model Law on International Commercial Arbitration

Arbitration — Award — Recourse against award —Setting aside —Arbitral tribunals admitting additional evidence relating to bribery, corruption and fraud in revived proceedings —Whether arbitral tribunals acted in excess of jurisdiction —Article 34(2)(a)(iii) UNCITRAL Model Law on International Commercial Arbitration

Arbitration — Award — Recourse against award —Setting aside —Whether parties provided with proper opportunity to present their cases —Section 24(b) International Arbitration Act (Cap 143A, 2002 Rev Ed) —Article 34(2)(a)(iii) UNCITRAL Model Law on International Commercial Arbitration

Facts

The plaintiffs were Lao Holdings NV (“LH”), a company incorporated in the Netherlands, and its wholly-owned subsidiary, Sanum Investments Ltd (“Sanum”), a company incorporated in Macau. The plaintiffs had partnered with a Laotian conglomerate, ST Group Co Ltd (“ST Group”) and its related entities and individuals to conduct business in Laos. The plaintiffs invested in projects including: (a) the Savan Vegas Hotel and Casino Complex (“Savan Vegas”), which was built and operated successfully; (b) the Paksong Vegas Hotel and Casino Complex (“Paksong Vegas”), which was never developed; and (c) various slot clubs, including the “Lao Bao Club”, the “Ferry Terminal Club”, the “Thanaleng Club”, the “Paksan Club”, and the “Thakhaek Club” (which was planned for but not developed).

In August 2012, LH commenced arbitration proceedings against the Government of the Lao People's Democratic Republic (“GOL”) under the auspices of the International Centre for Settlement of Investment Disputes (the “ICSID Arbitration”). Sanum also commenced arbitration proceedings against GOL under the auspices of the Permanent Court of Arbitration (the “PCA Arbitration”, collectively, the “BIT Arbitrations”). The tribunal in the ICSID Arbitration (the “ICSID Tribunal”) and the tribunal in the PCA Arbitration (the “PCA Tribunal”, collectively, the “BIT Tribunals”) shared common party-appointed arbitrators, albeit with different presiding arbitrators.

Just prior to the commencement of the merits hearings in the BIT Arbitrations in June 2014, the parties concluded a deed of settlement (the “Settlement Deed”) together with a “Side Letter” dated 18 June 2014. The BIT Arbitrations were suspended by consent. The Settlement Deed allowed the plaintiffs to revive the BIT Arbitrations in the event that GOL was in material breach of certain provisions in the Settlement Deed. Further, it provided in section 34 that if the BIT Arbitrations were revived, neither the plaintiffs nor GOL were permitted to “add any new claims or evidence to the arbitration nor seek any additional reliefs not already sought in the proceedings”.

In December 2017, pursuant to applications by the plaintiffs, the BIT Tribunals found that there was a material breach of the Settlement Deed and ordered the BIT Arbitrations to be revived.

On 15 May 2018, GOL filed an application to introduce additional evidence (“GOL's Application to Admit Additional Evidence”). The BIT Tribunals ruled on GOL's Application to Admit Additional Evidence in PCA Procedural Order No 9 (“PCA PO 9”) and ICSID Procedural Order Procedural Order No 11 (“ICSID PO 11”), finding that the tribunals retained the residual discretion (despite section 34 of the Settlement Deed) to admit evidence. The BIT Tribunals admitted: (a) the award rendered in a separate arbitration between the plaintiffs and ST Group; (b) documentary evidence and sworn testimony relevant to GOL's defences relating to allegations of bribery, corruption and fraud; and (c) an accounting report (the “BDO Report”) in so far as it dealt with GOL's allegations of bribery and corruption (collectively, the “Bribery/Fraud Allegations Material”).

On 16 July 2018, the plaintiffs submitted a request to introduce their own additional evidence to rebut GOL's additional evidence, including an expert report (the “Kurlantzick Report”). While the BIT Tribunals admitted other pieces of additional evidence, the Kurlantzick Report was not admitted.

On 10 August 2018, GOL made a further application to introduce, inter alia, the witness statement of Mr Angus Roderick Noble (“Mr Noble”) which related to the offer that Mr Noble's company, MaxGaming Consulting Services Ltd (Macau) (“MaxGaming”) had purportedly made to purchase Savan Vegas for US$220m pursuant to the settlement between the parties, and which had been submitted in another arbitration between the plaintiffs and GOL. The BIT Tribunals granted this application.

After hearing parties, the final awards were rendered in the ICSID Arbitration (the “ICSID Award”) and the PCA Arbitration (the “PCA Award”) on 6 August 2019, in which the BIT Tribunals dismissed all of the plaintiffs' claims and...

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