The British multinational company HSBC denounces an “excessively unusual and unreasonable delay” by the Constitutional Chamber to resolve a judicial process initiated in 2009.
The delay of a judicial response by the Constitutional Chamber in a judicial case could expose the country to an international claim before the International Center for Settlement of Investment Disputes (ICSID) of no less than $ 49 million.
The British multinational bank HSBC, in its Latin American Holding (HLAH), through its legal representatives, sent on December 17, 2020 a letter addressed to the President of the Republic, the Attorney General of the Republic and the President of the Court Supreme Court in which they notify about a “controversy” that arises from a judicial process with the Salvadoran company Ingeniero José Antonio Salaverría y Compañía (IJASAL) in which the bank affirms that they have found “unusual and unreasonable delays” on the part of the Constitutional Chamber of the Supreme Court of Justice.
In the notification, the bank reminds the authorities that in 1999 the country signed an Agreement for the promotion and reciprocal protection of investments with the Government of the United Kingdom of Great Britain and Northern Ireland, abbreviated with the acronym APPRI UK-El Salvador.
READ ALSO: Constitutional Chamber reiterates to Bukele that it cannot shut down the country’s economy
“El Salvador explicitly assumed the international obligation to accord a fair and equitable treatment in its territory to investors from the United Kingdom, including the obligation to protect them against all arbitrary and discriminatory treatment,” the document states.
“The conduct of certain courts in El Salvador in this matter, including its highest judicial authority, constitutes a denial of justice to HLAH and constitutes an inequitable, unfair, arbitrary and discriminatory treatment by El Salvador. The violation of these international obligations means that El Salvador will have to compensate HLAH with public funds for the losses caused as a result of its conduct, ”the document states.
In the letter, the Bank notifies the authorities about this controversy and advises them that if it is not resolved within a period of three months from the date of issuance of the letter, the bank will initiate a process before the International Center for Settlement of Differences Regarding Investments (ICSID) “without further notice”.
“HLAH hopes that the Constitutional Chamber of the Supreme Court will soon resolve the appeal that is pending before it related to the controversy in such a way that it is not necessary to resort to ICSID. If the controversy is not resolved satisfactorily, HLAH will initiate the corresponding arbitration ”, he warns.
According to a chronological summary made by the bank, HSBC entered into a loan contract in July 2007 with the company Ingeniero José Antonio Salaverría y Compañía, of Variable Capital. The loan was for $ 2.1 million.
In June and October 2008 HSBC El Salvador sued IJASAL to collect the outstanding debt.
But later IJASAL sued HSBC claiming that the judicial procedure was in violation of a new agreement. With this he requested that HSBC be ordered to pay the sum of $ 22.7 million in damages and prejudices.
The process reached the Civil Chamber, which ruled in favor of IJASAL, ordering the payment of $ 49.3 million.
According to the summary of its complaint, in the process followed in the First Commercial Court, HSBC did not have the right to participate in the acquittal of positions.
The bank points out that in view of the violations of its fundamental rights, it filed an appeal for protection before the Constitutional Chamber to request that the resolution of the Civil Chamber be reversed.
“The Chamber takes between four and eight months to decide on the admissibility of these remedies,” states the legal firm that, however, the Chamber already has a 17-month delay without ruling on the admissibility of the amparo.
And on the other hand, the execution process has proceeded very quickly. “The First Commercial Court, responsible for the execution, issued a seizure act in just two months,” he says.
The Constitutional Chamber has not yet reported whether it has already admitted the process that the international financial entity claims has been stopped.