Ping An, one of China’s biggest insurance companies has begun arbitration proceedings against the Belgian state on the basis of the bilateral investment treaty (BIT) signed between Belgium and China. The Treaty provides, inter alia, for bilateral protection of investments by nationals of one country in the other country. As with other BIT’s, in the event of a dispute, at the option of the investor, the matter is submitted to arbitration under the rules of the International Centre for the Settlement of Investment Disputes (ICSID), an international arbitration body set up by the World Bank based in Washington.
The case relates to the insurance company’s investment stake of 5% in Fortis, which, when originally made in 2007, was worth US$ 3.8 billion. The company suffered losses estimated at some US $ 2 billion, when Fortis collapsed in 2008-2009 and had to be bailed out by the Belgian government. In return, the government acquired shares in Fortis Bank, part of which, against the wish of Ping An, it subsequently sold to BNP Paribas.
The case is a first in two respects: it is the first time that a PRC investor has had recourse to arbitration under the ICSID rules and it is also the first international investment case in which Belgium is cited as a defendant.
The Arbitral Tribunal has recently been constituted and the case will now proceed. The Chairman of the Arbitral Tribunal is Lord Collins, a former Justice of the UK Supreme Court and the two co-arbitrators are Mr David Williams, QC , New Zealand national, and Mr Philippe Sands, QC, a dual French-British national.
The arbitration proceedings are not public.