This section highlights excerpts of relevant press releases and brief comments on our views regarding such.
“Guaido’s Counsel intend to void the arbitration with ConocoPhillips”
The General Attorney appointed by the National Assembly, José Ignacio Hernández, is seeking to void arbitration award of USD 8,7 billion to ConocoPhillips since the method used to determine that amount was allegedly erroneous.
“PDVSA’s Venezuelan fleet operator seeks to arrest three tankers”
Bernhard Schulte Shipmanagement (BSM) has taken actions to legally arrest three of PDVSA’s tankers: Arita in Singapore, Río Arauca and El Parnaso in Portugal; in order to collect a debt for services rendered to the state-owned company. BSM redelivered 4 vessels to PDVSA and had plans to redeliver another nine in June.
“Citgo Petroleum Negotiates with Aruba for Refinery Contract”
Citgo Petroleum Corp stated it is in conversations with the government of Aruba to operate its refinery in the future, which has been inactive since 2012. However, the First Minister of Aruba Evelyn WeverCroes, informed that the government foresees “three possible scenarios for the refinery: (i) continue working with the oil company, (ii) negotiate the end of the contract, or (iii) use the site for a different activity.”
“Citgo Gets U.S. Subpoena Related to Venezuela Bribery Probe”
Citgo Petroleum Corp received a subpoena from the U.S Department of Justice from an investigation about bribery in Venezuela. The subpoena is related to accusations against individuals that have continued for years, and involve bribery plans with PDVSA to obtain contracts with the state-owned company. However, CITGO did not identify the reason for the subpoena, but has committed to cooperate with the investigation.
“Russia Squeezing Embattled Venezuela for TaxFree Gas Expansion”
Rosneft PJSC, Russia’s state-controlled oil company, is entering into the natural gas market in Venezuela through concessions granted to produce and export gas from the Patao and Mejillones fields. The parties signed an accord which guarantees Rosneft tax breaks to develop such activities and a “fair market price in the event of expropriation”. According to Russian media, Rosneft owns the entire project and could export all the gas from both deposits.
II. CASE LAW
This section comments on relevant case law during the corresponding quarter and our brief comments to it
Decision by the Constitutional Chamber of the Supreme Court of Justice dated May 23, 2019 in the matter of the State of Emergency requested by Nicolas Maduro
Under Decree N° 3.844 dated May 9 2019, Maduro declared a State of Emergency and Economic Hazard in all the National Territory for 60 days extendable for 60 more. Such Decree was subject to the review of the Constitutional Chamber for it to be declared within constitutional rules. The provisions of the Decree awarded the Maduro with full powers to undertake extraordinary, exceptional and necessary measures to preserve internal order and security, to guarantee the population with free use of their rights and uninterrupted access to goods and services. In addition, the Supreme Court of Justice declared void and non-existent any action or statement from the National Assembly, which disapproves this Decree.
Decision by the Political and Administrative Chamber of the Supreme Court of Justice dated May 21, 2019 in the matter Mantenimiento Casalbeach, C.A. v. The Bolivarian Republic of Venezuela represented by the National Antidrug Office (ONA)
The Chamber accepts the possibility of moral damages to companies and entities within its jurisdiction. In order to establish the liability and the amount to be granted under this concept there are three prongs to consider:
- The reputation of the company before the incident.
- The impact of the transgression in the company’s market.
- Any other reason that may link the compensation requested to the transgression suffered by the plaintiff.