On 22 December 2023 the Aribitral Tribunal (ICSID Convention) rendered its Award in Peteris Pildegovics and SIA North Star v. Kingdom of Norway (ICSID Case No. ARB/20/11). The dispute arose “out of measures taken by the Respondent regarding the alleged restriction of the fishing of snow crab in certain zones over which Norway exercises certain sovereign rights, which allegedly undermined the Claimants’ investments in snow crab fishing, resulting in a loss to their investment” (Award, para. 5). Findings, among others, include:
In the present case, the Tribunal is not entitled to rule on the dispute between the different parties to the Svalbard Treaty on whether or not Article 2 of that Treaty requires Norway to allow nationals of the other States parties access to hunting and fishing resources on the continental shelf around Svalbard (para. 295; see further paras 582-585).
Since the Claimants are claiming only for alleged breaches of the BIT [Latvia – Norway BIT (1992)], it is the BIT which the Tribunal must apply. In doing so, it can consider — if it is necessary to do so — the other treaties invoked [Svalbard Treaty, UNCLOS and the NEAFC Convention], as well as other rules of international law. However, whether a provision of one of those treaties is relevant to the determination of whether Norway has breached a provision of the BIT is not a matter on which it is safe to generalise; that question must be considered in the context of the specific facts and allegation raised (para. 448).
The Tribunal agrees with Norway that whether the snow crab is a sedentary species is a matter of law, namely whether it falls within the definition in Article 77(4) [UNCLOS], and that no designation is required (para. 489).
First, while the Tribunal is not called upon to decide whether or not the snow crab is a sedentary species within the UNCLOS definition, Norway’s conclusion that it is a sedentary species cannot be regarded as an outlier…Secondly, such scientific assessment as has been shown to the Tribunal tends to support the conclusion that, at the harvestable stage, snow crab “are unable to move except in constant physical contact with the seabed” (paras 480-481).
The duty to act in good faith in the exercise of a State’s power is expressly provided for in Article 300 of UNCLOS…The Tribunal does not accept that Norway’s treatment of the status of snow crab was arbitrary or that it demonstrated a lack of good faith…Nor can Norway be faulted for the procedure which it followed…That leaves the question whether, once Norway had concluded that snow crab is sedentary, its action in imposing a ban on taking snow crab in the Norwegian sector of the Loop Hole was arbitrary or amounted to a lack of good faith within the meaning of Article 300 of UNCLOS or customary international law. The Tribunal does not accept that that was the case (paras 534-539).
[T]he Tribunal accepts that a State which uses a power that it possesses for an extraneous, improper purpose may be considered to have acted arbitrarily and in abusive or bad faith manner… It is essential, however, to be clear what is the purpose of the power which the State is accused of exercising improperly. In the case of the powers of the coastal State over the resources of the continental shelf, Articles 77(1) and (2) of UNCLOS make clear that those rights are conferred for the purpose of enabling the coastal State to enjoy the benefit of the resources of the continental shelf…The Claimants have argued that Norway acted in order to exclude the EU vessels harvesting snow crab on its continental shelf and reserve the resource for its own fishing industry, but that is exactly what Article 77 provides for. There is nothing extraneous or improper in Norway acting in this way. Nor is there anything wrong with it using its sovereign rights as a bargaining chip with the EU which has done the same in relation to marine resources in the continental shelves and EEZs of its Member States (paras 541-543).
Peteris Pildegovics and SIA North Star v. Kingdom of Norway, Award of 22 December 2023
De Maribus 