The French company Eutelsat lost a SATMEX case against Mexico under the Mexico-France BIT.

In a statement, the Ministry of Economy reported that on September 15, an international court decided to dismiss a claim greater than 120 million dollars presented by Eutelsat.

The case was established in accordance with the Arbitration Rules (Additional Mechanism) of the International Center for Settlement of Investment Disputes (ICSID).

The award condemns the investors to pay Mexico for expenses derived from the defense in the arbitration headed by the Ministry of Economy.

SATMEX and Eutelsat

In 2014, the company acquired 100% of the share capital of the company SATMEX and thus became the owner of the concessions that were granted to SATMEX to occupy geostationary orbital positions in Mexico.

Eutelsat claimed alleged arbitrary acts of the SCT, given that it had refused to reduce the Satellite Capacity Reserved to the State (CSRE) expressly contained in its concession titles related to free satellite capacity in favor of the Mexican State.

Eutelsat alleged that Mexico affected its legitimate investment expectations, did not grant it fair and equitable treatment; and treated it in a discriminatory manner compared to the treatment accorded to other companies in the sector.

The arbitral tribunal dismissed these claims. In addition, it ordered Eutelsat to pay proportional costs and expenses of the arbitration.

The General Directorate of Legal Consultancy for International Trade, belonging to the Undersecretariat of Foreign Trade, coordinated the defense of the Mexican State in this arbitration proceeding, administered by ICSID, an agency of the World Bank.

The court determined that Mexico did not breach its obligations under the Mexico-France BIT and dismissed the claims on the merits. Therefore, the Court ordered Eutelsat to pay a proportional part of Mexico’s legal fees and expenses, as well as to cover part of the costs of the arbitration.