The Government of Costa Rica was notified by the International Center for Settlement of Investment Disputes (ICSID) of the decision by the Arbitration Court in relation to the David Richard Aven et al c. Costa Rica (known as “Las Olas”). This arbitration was presented by a group of US investors in the year 2014 due to the Government shutting their real estate project down.  The claimants cited the Dominican Republic-Central America-United States (CAFTA-DR) Free Trade Agreement.

The claimant alleged arbitrary ( Legal) actions by the Costa Rican Government in relation to the suspension of environmental viability permits of a tourist project of 39 hectares located in Esterillos Beach, which resulted in the project coming to a halt. The reason for the suspension of the project by the government authorities was the identification of several wetlands and forest located in the lands being developed and which had supposedly been affected by the claimants development.

The decision was decided in favor of Costa Rica in its totality. The ICSID rejected the claims stated by the US investors with a valuing their losses at US$103.5 million. In the same act, the ICSID ordered claimants to pay the Government of Costa Rica US $1,090,905.10 for the expenses incurred during the legal process.

In the resolution of the Arbitration Court the arguments presented by the defense of the Costa Rican Government stating that in effect the wetlands and forests exist in the site were accepted. The Court was clear in saying that “certainly the works done by the claimants affected the wetlands and, therefore, required the reaction adopted by the Costa Rican Government in conformity with national laws which are consistent with international law. In addition, the actions taken by the defendant are not arbitrary nor breach DR-CAFTA obligations.”

“This resolution confirms that our country is committed to the rule of law, respectful of the rights of nationals and foreigners, (and) maintaining the environmental standards that have always characterized us nationally and internationally,” said Foreign Trade Minister Dyala Jimenez.

The minister added that the resolution confirms the quality of the country as a recipient of investments, honoring the international trade commitments that provide clear rules with foreign partners.

The decision of the Arbitration Court will be firm in three calendar months after its notification, during this term any of the parties can present an annulment request.