Judgment of Svea Court of Appeal, 30 May 2005, Case No. T 9059-03

Summary: The claimant in an investor-state arbitration challenged the arbitral award under Section 36 of the Swedish Arbitration Act, which provides that the Court may amend an award where the arbitrators concluded the proceedings without ruling on the issues submitted to them for resolution. The claimant had filed for arbitration seeking compensation from the Czech Republic under a bilateral investment treaty. The arbitral tribunal had dismissed the case, stating that the claimant had not made an “investment” as defined by the treaty, and that he therefore was not entitled to compensation. The claimant argued before the Court that the arbitral tribunal had made this determination in the context of determining whether it had jurisdiction over the dispute, and that the case had been “dismissed” rather than decided on its merits. Therefore, claimant stated, the Court could review and amend the award under Section 36. The respondent argued that Section 36 did not apply because the arbitral tribunal had decided, on the merits, that the claimant had not made an investment as defined by the treaty. The Court of Appeal found that the arbitral tribunal had decided on the merits that the claimant had not made an investment. Although the arbitral tribunal had “dismissed” certain parts of the case, those were so closely connected to the issue of whether the claimant had made an investment – an issue decided on the merits – that the award could not be challenged under Section 36.