In its judgment of 21 April 2023 (ECLI:NL:HR:2023:636), the Dutch Supreme Court confirmed that Dutch arbitration law, provides no ground for annulment of arbitral awards, including international investment treaty awards, in which the tribunal denies jurisdiction. Awards on jurisdiction are only eligible for annulment if the tribunal has accepted jurisdiction despite the absence of a valid arbitration agreement.

The claimants in the UNCITRAL arbitration, the family Garcia-Armas, had put forward a claim against the Republic of Venezuela under the Spain – Venezuela bilateral investment treaty (BIT) for damages as a result of alleged unlawful expropriation. All claimants have both the Venezuelan and Spanish nationality.

In its Award on Jurisdiction, the tribunal ruled on the issue of dual citizenship in light of the definition of “investor” under the BIT. It concluded that parties with a dual nationality, like the Garcias, do not fall within the definition of “investor” in the BIT.  Therefore, the tribunal did not accept jurisdiction.

Subsequently, the family commenced annulment proceedings before the Court of Appeal in the Hague, which refused to annul the Award on Jurisdiction, citing the absence of a ground for annulment in the Dutch arbitration law of 2015 in case a tribunal refuses jurisdiction. In that way, Dutch arbitration law follows the UNCITRAL Model Law (2006), which provides that only awards in which the tribunal accepted jurisdiction can be annulled because of a lack of an arbitration agreement.

Several other European countries, such as France and Switzerland, have deviated from this practice and have accepted the annulment of arbitral awards containing a negative decision on jurisdiction. The discussion before the Dutch Supreme Court took place in light of these developments outside of the Dutch jurisdiction. With the confirmation of the Supreme Court of the Court of Appeal’s judgment, it has been reconfirmed that, despite developments in other jurisdictions, the Netherlands still maintains the rule that negative jurisdiction awards are not eligible for annulment.