Summary

DECISION ON BIFURCATION

Arbitral Tribunal
Ms. Jean Kalicki (Tribunal President)
Professor Donald M. McRae
Professor Brigitte Stern

TABLE OF CONTENTS

I. INTRODUCTION
II. RELEVANT PROCEDURAL HISTORY
A. Commencement of the Arbitration and Constitution of the Tribunal
B. Adoption of the Rules of Procedure and Procedural Timetable
C. Submission of Azerbaijan's Statement of Claim
D. Written Submissions on Bifurcation
III. PARTIES' POSITIONS
A. Requests for Relief
B. Applicable Standard
(a) Armenia's Position
(b) Azerbaijan's Position
C. Armenia's Objections to Jurisdiction and/or Admissibility and Application of the Standard
1. Armenia's Objections
2. The Parties' General Observations on Bifurcation of Armenia's Objections
(a) Armenia's Position
(b) Azerbaijan's Position
3. Armenia's Article 18 Objections
(a) Armenia's Position on the Bifurcation of its Article 18 Objections
(b) Azerbaijan's Position on the Bifurcation of the Article 18 Objections
4. Armenia's Article 7 Objections
(a) Armenia's Position on the Bifurcation of its Article 7 Objections
(b) Azerbaijan's Position on the Bifurcation of the Article 7 Objections
5. Armenia's Temporal Objections
(a) Armenia's Position on the Bifurcation of its Temporal Objections
(b) Azerbaijan's Position on the Bifurcation of the Temporal Objections
6. Armenia's Essential Security Exception Objection
(a) Armenia's Position on the Bifurcation of its Essential Security Exception Objection
(b) Azerbaijan's Position on the Bifurcation of the Essential Security Exception Objection
7. Armenia's Attribution Objection
(a) Armenia's Position on the Bifurcation of its Attribution Objection
(b) Azerbaijan's Position on the Bifurcation of the Attribution Objection
IV. TRIBUNAL'S ANALYSIS
A. Considerations Relevant to Bifurcation
B. The Suitability for Bifurcation of Armenia's Various Objections
C. Summary and Procedural Implications
V. ORDER

I. INTRODUCTION

1. The parties to these proceedings are the Republic of Azerbaijan ("Azerbaijan") and the Republic of Armenia ("Armenia") (together, the "Parties").

2. According to Azerbaijan, a dispute has arisen between the Parties under the Energy Charter Treaty (the "ECT" or the "Treaty"). In its Notice of Arbitration dated 27 February 2023 ("Notice of Arbitration"), Azerbaijan alleges, among other things, that Armenia has breached its obligations under Article 18 and Article 7 of the ECT.1

3. Armenia has indicated that it has objections to the Tribunal's jurisdiction and to the admissibility of Azerbaijan's claims. By way of its Request for Bifurcation submitted on 23 December 2024 ("Request for Bifurcation"), Armenia requested that the Tribunal bifurcate the proceedings in order to determine these objections in a preliminary phase. Azerbaijan opposes that request. This Decision determines the issue.

...

V. ORDER

96. For the reasons stated above, the Tribunal:

(a) grants Armenia's Request for Bifurcation with respect to the first Article 18 Objection and first, second and third Article 7 Objections;

(b) joins the remainder of Armenia's Objections to the merits;

(c) decides that the proceedings will continue according to the schedule set out in Scenario A of the amended Procedural Timetable, unless hereafter adjusted following consultation with the Parties; and

(d) reserves its decision with respect to the costs of the Request for Bifurcation.

On behalf of the Tribunal

...