Mexico City, September 29 (EL UNIVERSAL) – Mexico has announced its triumph in an international arbitration case at the International Centre for Settlement of Investment Disputes (ICSID) against Doups Holdings, a company involved in a parking meter project in Mexico City (CDMX).
The dispute stemmed from a concession granted in 2017 by the CDMX Secretariat of Mobility to Doups Holdings for a 10-year period, extendable for another similar term. Doups Holdings claimed that in 2018, after significant investment, the concession was revoked. Following this, in 2000, the company sent a letter to the then-government of Andrés Manuel López Obrador and the federal Secretary of Economy, Graciela Márquez, notifying its intention to initiate a commercial dispute. The formal presentation of the dispute occurred in 2022, with Doups Holdings claiming 600 million pesos under the then-North American Free Trade Agreement (NAFTA).
ICSID Dismisses Doups Holdings’ Claim
In a statement, the Secretariat of Economy reported that ICSID dismissed the company’s claim because “Mexico argued that the claim presented serious deficiencies, specifically regarding the formation of the subsidiary company that allegedly suffered the damages; the nationality and control of said subsidiary; and procedural requirements for accessing arbitration.”
The Mexican defense successfully demonstrated that “Doups’ claims had serious deficiencies that prevented the Arbitral Tribunal from resolving the dispute in light of NAFTA.” Last September, the arbitral tribunal ruled in favor of Mexico, determining that it lacked jurisdiction to hear the claims presented by Doups, dismissing the arbitration in its entirety.
Reasons for Dismissal and Financial Implications
The Secretariat further stated that ICSID “concluded that Doups had agreed to be considered Mexican with respect to its investment, failed to prove control of Pagomet, could not claim its losses as its own, and failed to comply with indispensable requirements set forth in NAFTA prior to initiating an arbitration.” Furthermore, Doups was ordered to pay Mexico more than one million dollars in expenses and costs.
The case was handled by the Directorate General of International Trade Legal Consultancy of the Undersecretariat of Foreign Trade, which also contracted the law firm Pillsbury Winthrop Shaw Pittman.
