CHILE Trends and Developments Contributed by: Julio Pellegrini, Fernando Zuñiga and Bernardo Aylwin, Pellegrini y Rencoret
judicial authority vested with competence when San - tiago is designated as the seat of arbitration – which, to date, have been applied consistently across all annulment proceedings, irrespective of the parties’ nationality. Ecuador: A Common Thread in International Arbitrations Between Foreign Parties Seated in Chile A particularly illustrative manifestation of Chile’s evolv - ing role as a regional arbitral seat is found in a recent series of annulment proceedings before Chilean courts arising out of arbitrations involving the Republic of Ecuador or its state-owned enterprises – especially in the hydrocarbons and energy sectors – or concern - ing facts materially connected to Ecuador. The relevant cases include: • Worley International Services Inc. v Consultora Tecnazul Cía Ltda (Court docket No 6.753-2021, decision dated 30 November 2022); • Empresa Pública de Hidrocarburos del Ecuador EP v Servicios Integrados Pañaturi S.A. (Court docket No 10.750-2022, decision dated 12 May 2023); • Republic of Ecuador v Gente Oil Ecuador PTE. Ltd (Court docket No 12.506-2022, decision dated 18 October 2024); • Empresa Pública Estratégica Corporación Eléctrica del Ecuador CELEC EP v Inter Rao UES and others (Court docket No 13.359-2023, decision dated 1 March 2025); and • Republic of Ecuador v EcuadorTLC (Court dockets No 4319-2023 and 10221-2024, both proceedings pending). Aside from their Ecuadorian nexus, these proceedings are unified by a salient feature: in each case, Chile was expressly designated as the seat of arbitration by vir - tue of an arbitration clause in the respective contracts. Although, to the authors’ knowledge, no official ration - ale has been disclosed by the parties for selecting Chile as the seat, it is reasonable to infer that both sides regarded Chile as a neutral, stable and arbitra - tion-supportive jurisdiction – qualities that rendered it a credible venue for potential challenge proceedings.
All of the underlying contracts were executed sub - sequent to the 2008 Constitution of the Republic of Ecuador, which introduced important constraints and formalities governing international arbitration involv - ing the state. Commenting on the post-constitutional contractual framework, Ecuadorian legal scholarship has acknowledged: “It is a positive development that in the new oil contracts the State is using international arbitration clauses that designate Chile as the seat of arbitration and the Permanent Court of Arbitration in The Hague as the appointing authority,” noting that this model had also been applied in contracts with telecommunications companies controlled by foreign investors (J.M. Marchán, El tratamiento del arbitraje en la nueva constitución ecuatoriana , p. 209, 2015). Consequently, disputes arising from such contracts have led to the issuance of international arbitral awards, the annulment of which was subsequently sought before Chilean courts. These cases posed a unique challenge for the Chilean judiciary: they involved disputes factually rooted in a third country with a complex regulatory oil and gas framework, and in most instances, the party appearing before the Chil - ean courts was the Ecuadorian state itself. Nevertheless, by hearing – and thus far uniformly rejecting – these annulment claims, Chilean courts have reaffirmed their institutional commitment to arbi - tration, upholding the expectations of the contract - ing parties and reinforcing Chile’s growing stature as a reliable seat for international dispute resolution in Latin America. The Court’s Ongoing Consolidation of the Principle of Minimal Judicial Intervention Article 34 of the International Arbitration Act, consist - ent with the UNCITRAL Model Law, narrowly circum - scribes the grounds on which an international arbitral award may be set aside: (i) one of the parties was under some incapacity or the arbitration agreement is not valid; (ii) a party was unable to present its case; (iii) the award deals with a dispute not contemplated in the arbitration agreement or contains decisions on matters beyond the scope of such agreement; (iv) the composition of the arbitral tribunal or the arbitral pro - cedure was not in accordance with the agreement of the parties; (v) the subject matter of the dispute is
134 CHAMBERS.COM
Powered by FlippingBook