30 thoughts on “Swiss Court Rules Israel Owes Iran $1.1-Billion from Oil Dispute – Tikun Olam תיקון עולם إصلاح العالم
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  1. Fascinating. Be interesting to see if the international legal system’a system for recovery of judgments works “as advertised” or, instead, can be defeated by political power considerations.

    Please help us follow this story.

  2. I’m not an expert on such matters, but arbitration, especially international arbitration is generally a creature of contract, in other words, in the typical case, both sides would have conceded in the original agreement, that in the event of a dispute concerning the agreement, they will submit to binding arbitration. Typically the contract will spell out the arbitration rules, arbitrators, neutral forum (e.g. Switzerland, London, Hong Kong, etc.). Now, here is a key point, Iran, Israel, and just about every other country in the world are signatories to the New York convention, otherwise known as The Convention on the Recognition and Enforcement of Foreign Arbitral Award (http://www.newyorkconvention.org/contracting-states/list-of-contracting-states). Basically, any New York Convention contracting state is obligated to recognize any arbitral award granted in another signatory state as binding in that country. So, for example, Iran could, theoretically, go to an Israeli court and seek its $1.1B (or an American, German, UK, court etc.). My point here is not to suggest that they would be ballsy enough to do so, but that assuming there is no defect in the arbitration proceeding or (more typically) the arbitration agreement itself, Iran’s options in collecting would seem to be limited only by those countries in which there are Israeli assets. While I am not familiar with the matter, there are a few avenues in challenging the award, but again, these tend to go back to the original arbitration agreement itself. My guess is that Iran is pretty familiar with this process, as there were likely lots of broken agreements post-revolution.

    1. @ LibTex76: Thanks, you sound better informed than I on these matters. I was seeking such background information from someone more experienced than I on international law. Contrary to Melman, I see no reason why Iran shouldn’t or wouldn’t go after Israeli assets wherever they are. How about the embassy in DC? That should get Israel’s attention.

      1. Hmmmm, I can think of $3billion of ready cash that flows into Israeli government coffers each and every year.

        It would be poetic justice indeed if the Iranians made a move to syphon $1.1 billion of that as compensation.

        And, hey, it’s still only represents four month’s worth of lollies, all courtesy of Uncle Sugar Bags

  3. Israel violated sanctions to do business with Iran, stole a partnership deal and sold the oil …the litany never ends because there are no consequences for Israel. The complainant can barely get the complaint into the media, no surprise here either. Of course, the US facilitates this lawlessness.

  4. A few things to clarify:

    1. At the time the contract refers to, trading with the Shah violated no international sanction. Iran itself was violating OPEC “boycott America” rules from fall 1973 to the Shah’s fall in 1979.

    2. As noted above, parties to a contract bind themselves to arbitration as part of the original contracts or in separate documents referring to those contracts. Swiss arbitration comes in two varieties — a “Swiss rules” option more or less run by the Swiss Chambers of Commerce under Swiss law, and the International Chambers of Commerce (ICC but not to be confused with the UN’s International Criminal Court) Court of Arbitration, also run in Switzerland but under international arbitration rules. I think decisions in both are subject to the New York Convention. There is also an Arbitration Court of International Justice whose decisions are apparently not enforceable through the NY Convention. Doubt if it was involved.

    3. There is little reason to believe the arbitration panel (Swiss or International rules) does not have jurisdiction. every contract specifies how disputes are to be resolved. It is doubtful that either Iran or Israel would consent to court resolution in the other’s national court system. It is also doubtful that any of the third-party national court systems that do accept jurisdiction for cases entirely outside their borders would be as suitable as Switzerland arbitration. If some of the financing for this pipeline and port system in Israel had been done in, say, London or NY, courts in those countries might have been given jurisdiction under any loan arrangement. But I think Iran itself financed the deal.

    It highlights an interesting issue. There is no UN-based international court for general civil claims. At a time when the difficulties enforcing environmental or labor standards in international trade agreements have been highlighted by the trans-Pacific trade agreement, that lack is especially glaring.

  5. Is it possible that NOT ONE PERSON in the Israeli government had NEVER read Exodus 20:15 –
    “Thou shalt not steal.”

    NOW, that the cat is out of the bag, my question; HOW MUCH of this $1.1 BILLION will be extracted from the U.S. taxpayers?????????????????

  6. I think diplomatic property is off limits in these kinds of economic disputes — they are technically the territory of the guest country.

    My understanding is also that if an arbitration award or judgment cannot be paid immediately due to some practical reason — sanctions or whatever — it must be paid into an escrow account. Arbitrators usually have the right (at least under international rules, maybe not under Swiss rules) to specify time, location and kind of payment (not just the amount). Will be interesting to see the full award document.

  7. Two words – “Frozen Assets”.

    Stealing??? As Richard ‘revealed’ here (https://www.richardsilverstein.com/2015/04/20/idf-censor-seeks-possible-phantom-leaker/) there is an account with Iran name on it, waiting for a friendly government to be return to.

    Only a suicidal maniac will transfer a huge payment to an entity wishing to destroy it. (Noone can argue Iran doesn’t wish to destroy the entity called Israel in its current zionist form).

    1. @ Tankist: On the contrary, there is an account which Israel has used surreptitiously for God knows what purpose. No one knows how much is in this account, but it certainly isn’t $1.1-billion. If you ever write again that Iran “wishes to destroy Israel” you will be banned, as this is a lie.

      1. You distort my sentence (as expected). Do you dispute Iran wishes to destroy the current Zionist entity?

        1. @Tankist: I don’t distort anything. You said Iran wishes to destroy Israel. It doesn’t. Even if you change the terms and say it wishes to destroy the “Zionist entity,: that isn’t strictly true. It wishes that Israel’s current political structure (you can call that “Zionist” though I wouldn’t) would be transformed. In other words it supports a one state solution, something even Reuven Rivlin supports. So if you wish to say that Iran agrees with Rivlin on Israel’s future, that’s fair. And no Iranian leader has ever said Iran would be the party which did this. They only said they wished it would happen.

          1. And again you misquote my sentence and do Hula-Hups to make it sound bad.

            As for your comment about Rivlin, I doubt he has much in common with Iranian vision. A core part would be ‘the right to return’ which will eliminate the Jewish majority in no time. For Iran that is the essence of the whole process, for Rivlin- well, he would never agree to it.

          2. @Tankist: And you know Rivlin’s views on ROR because… ? Oh that’s right, you don’t.

            I’d venture to say that if Rivlin & Rouhani were placed alone in a room r a few fays they could solve the Israel-Iran conflict along with the Israel-Palestine conflict.

          3. The logic in your sentence is so wrong I don’t know where to start.
            The equivalent would be to say Obama, Iran and Sadam Hussein want the same thing in Iraq – ‘to get out the American soldiers’. While this is true, does it tell the full story. Not even a tiny part of it. Did someone say PROPAGANDA?????

  8. If I were Israel, I’d argue that the arbitration award is a nullity because Iran and Israel are currently in an ‘international armed conflict’ viz-a-viz the Iranian proxy known as Hezbollah, this, because Iran plays a role in organizing, coordinating or planning the military actions of the military group [Hezbollah], in addition to financing, training and equipping or providing operational support to Hezbollah.

    1. Israel could argue the point and probably has, but again, the money would go to escrow until hostilities cease, if Israel could show a firm link. Hezbollah would exist without Iranian help I would think.

      1. Best scenario ever. Israel pays out the one billion, but directly to the Iranian people, bypassing the monstrous, incompetent, kleptocratic mullahs. Hand the monies over directly to social welfare programs, charitable donations, clinics, environmental study programs, etc.

    1. Oh Lawdy, the Times of Isrsel, the king of fake journalism has dredged up yet another piece of garbage!

      Not to mention that the Iranian referred to an Israeli attack on Hezbollah–that is, sovereign Lebanese territory. To which Iran might respond in defense of Lebanon & Hezbollah. You left that little bit out.

        1. @Richard

          “Not to mention that the Iranian referred to an Israeli attack on Hezbollah–that is, sovereign Lebanese territory. ”

          Richard. The Iranian didn’t say anything about an attack on Hezbollah, or sovereign Lebanon.

          “Iran, with the help of Hezbollah and its friends, is capable of destroying Tel Aviv and Haifa in case of military aggression on the part of the Zionists,”


          1. @ Walter: Because he mentioned Hezbollah’s rockets being launched against Israel, I assumed me referred to an attack on Lebanon. But it appears he was saying they would be used if Israel attacked Iran, not Lebanon.

            Here is precisely what he said:

            A senior Iranian military official Thursday warned that any Israeli attack would unleash a firestorm of missiles

            Any Israeli FIRST-STRIKE would elicit a response from Iran. Iran has every right to respond to such an attack by Israel in kind. I’m afraid the war crime in this case won’t be Iran’s, but Israel’s for its first strike against Iran.

            Personally, I think they’re all rattling sabers against each other. Israel isn’t going to attack Iran, at least not directly. It will, however attack Lebanon. Of that I have little doubt. Then those rockets & missles will be launched against Israel unfortunately.

          2. The Iranian said that any attack, on Iran, would be met with a Hezbollah (80,000 missile?) response. This is the very definition of war by proxy.

          3. The U.S. supplying much of Israel’s lethal weaponry for each of its wars makes Israel a U.S. proxy. So welcome to a nasty world of Israel & America’s creation.

          4. walter: “The Iranian said that any attack, on Iran, would be met with a Hezbollah (80,000 missile?) response. This is the very definition of war by proxy.”

            Err, no. That’s “war by ally”.

            There is even a Latin phrase for it: “casus foederis”

            A war by proxy would be a situation whereby, say, the South Lebanon Army is pitted against Hezbollah, with both those forces acting as substitutes (proxies) for Israel and Iran i.e. “war by proxy”.

            But since Israel abandoned the SLA in 2000 (“loyalty” not being a Zionist strong-point) then that fight didn’t even take place: the SLA simply capitulated.

  9. So now you are an advocate for the mad mullahs in Iran. Honestly, Richard, you need to get out of that basement and get some fresh air. Why don’t you take a vacation? It would do you good.

  10. After Fidel Castro had ousted the Batista government his government began to nationalize businesses of foreign owners. I understood then that such nationalizations are legal under international laws and that the expropriator is obliged to remunerate the owners for the value of property taken. If I remember correctly the following happened. The Castro government argued that the value of the business was what that business had claimed it to be in its tax returns which was obviously wildly low. It then offered payment in Cuban currency. US owners refused and demanded higher values and payment in dollars. They were backed by our government which eventually slapped sanctions on Cuba.
    The Israeli response has been far more extreme than that of Fidel. Has the time come to slap sanctions on Israel?

    1. There are plenty of reasons to put international pressure on Israel, and Iran has already suffered sanctions (for both good and bad reasons), but Fidel’s nationalizations had nothing to do with the sanctions. Countries stealing private property always use the “tax undervaluation” argument. But property owners (as Iran just did in the dispute over nationalization) have recourse to national and sometimes international courts and arbitration panels, which usually don’t consider the “tax/undervaluation” argument valid. To use a personal example, our small NYC apartment is in a 15-unit brownstone coop valued, in total for property tax purposes, under $300,000. My apartment, the smallest in the building, can be sold for almost that much. Does the low valuation mean the city could buy us out for a valid public purpose and pay a total of $300,000 for 15 apartments? Of course not. It is just a quirk in the NYC tax code. All property in the city is under-assessed. If it were all assessed at fair market value (as in most cities and states), the tax rate would go down and on average everyone would still pay the same tax.

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