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The Tinoco Arbitration - Case Presentation

The Tinoco Arbitration - Case Presentation

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Published by Khairul Idzwan
A handout made for my classmates for the purpose of case presentation [the Tinoco Arbitration] during the subject of Public International Law.
A handout made for my classmates for the purpose of case presentation [the Tinoco Arbitration] during the subject of Public International Law.

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Published by: Khairul Idzwan on Feb 27, 2009
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05/07/2013

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The Tinoco Arbitration(1932-1934) 2
 Annual Digest of Public International Law
Cases 34
1
Background:
o
1917 - Government of Costa Rica [President Alfredo Gonzales] overthrown byFederico Tinoco.
o
Tinoco assumed power & established new constitution
o
During his tenure, he:
Granted certain concession to search for oil to a British company
Passed legislation issuing certain new currencies, and British banks [in thecourse of business] became holders of much of this currency
o
1919 - Tinoco retired, left the country – Government fall.
o
Old constitution restored and elections were held.
o
August 22, 1922, restored government passed Acts nullifying the currency laws ithad made
o
Consequence: Invalidated all transactions involved
o
 The restored government is a signatory of the treaty of arbitration.
The Claim:
o
Brought by Great Britain on behalf of two British Corporations:
Royal Bank of Canada
Central Costa Rica Petroleum Company
o
Royal Bank of Canada claimed:
Banco Internacional of Costa Rica and the Government of Costa Rica areindebted to it proven by the holding of 998 1000 colones bills
o
Central Costa Rica Petroleum Company [CCRPC] claimed:
It owns the rights to explore and exploit petroleum reserves in Costa Rica
 This is based on a grant issued by Tinoco
1
At page 176 and 379.
 
The Defense:
o
Great Britain:
On behalf of its nationals, legislation passed invalid
Restored g’ment should recognize the concessions given to CCRPC and thevalidity of Tinoco’s currency held by the Royal Bank of Canada
During the period in question, the Tinoco Government had been the defacto and de jure government
2
Supported by the fact that the government was not opposed in anysignificant manner
 Thus giving the government legitimacy
All its acts were valid and its successor has no right to repudiate[annul]them
o
Costa Rica:
Objected. Claimed that any acts carried out by the government were voidbecause the Tinoco regime violated the Costa Rican constitution.
Because Great Britain did not recognize the Tinoco Government aslegitimate, it cannot then turn around and claim agreements with anillegitimate government as binding.
Held:
o
Rejected Costa Rica arguments
o
While the failure on the part of Great Britain to recognize Tinoco governmentwas evidence to be taken into account in deciding on the status of thatgovernment, it was not decisive as the status of the government had to bedetermined in the light of all evidence
o
In fact, the Tinoco g’ment had been a
de facto
g’ment during the period of itsexistence
2
 
UK always refused to recognize the Tinoco g’ment as either
de facto
or
de jure
government. H/ever, theystill claim at thearbitration proceedings that the Tinoco g’ment was in fact a
de facto
and
de jure
government.

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