Latham Achieves Second Consecutive Victory for the Republic of Colombia in Major International Environmental Dispute

Latham & Watkins has secured a second consecutive win for the Republic of Colombia at the World Bank’s International Centre for Settlement of Investment Disputes (ICSID), in connection with the client’s enactment of a ban on mining in the páramos, a rare and extremely fragile ecosystem in the Colombian Andes. Latham’s international arbitration team defeated a US$180 million claim brought by Montauk Metals Inc., a Canadian junior mining company, under the Canada-Colombia Free Trade Agreement (FTA), in which Montauk contended that the mining ban destroyed its large-scale gold mining project and as a result violated the FTA's expropriation clause and the customary international law minimum standard of treatment.

Following comprehensive briefings and a three-day merits hearing at the World Bank in Washington, D.C. in June 2022, the Tribunal delivered a unanimous final award on June 7, 2024, dismissing all of Montauk's claims. The Tribunal affirmed Latham's interpretation of the FTA and international law, acknowledging the critical role of páramos in environmental conservation and the fight against climate change. The Tribunal ruled that Colombia's mining ban, enacted through various legislative, administrative, and judicial actions, was a legitimate, non-discriminatory exercise of its power to regulate in the public interest, including the protection of the environment, and did not breach the FTA or international law.

The Latham team was led by International Arbitration Practice partners Fernando Mantilla-Serrano in Paris, and Samuel Pape in London, with associates Diego Romero and Matías Zambrano in Paris.

This result comes at the heels of the ICSID award in the Red Eagle arbitration, where the same Latham team achieved a complete victory for Colombia in a US$130 million claim relating to the same measures. Together, the Red Eagle and Montauk decisions affirm the right of sovereigns under international law to enact regulations in the public interest, particularly regarding the protection of the environment. These awards are genuine landmark rulings that will shape international investment law in the years to come, and further solidify Latham's leading position in international arbitration, public international law, and ESG-related disputes.